Documentos de Académico
Documentos de Profesional
Documentos de Cultura
R E P O R T
2 0 1 4
01
CONTENTS
2-8
Corporate Information
10
Financial Highlights
11
Directors' Profile
12 - 14
15 - 16
17 - 18
19 - 27
28
29 - 32
33
34 - 35
Directors' Report
36 - 39
Statement by Directors
40
Statutory Declaration
40
41 - 42
43
44
45 - 46
47 - 48
49 - 107
Supplementary Information
108
109
Analysis of Shareholdings
110 - 111
Proxy Form
Enclosed
02
To receive the Audited Financial Statements for the year ended 31 May 2014 together with the Reports
of the Directors and Auditors thereon.
Resolution 1
2.
To approve the declaration of a first and final single tier dividend of 6% for the financial year ended
31 May 2014.
Resolution 2
3.
To re-elect the following Directors who are retiring in accordance with Article 87 of the Companys
Articles of Association and are offering themselves for re-election:
(a)
Wong Thai Sun; and
(b)
Hwang Siew Peng
4.
Resolution 3
Resolution 4
To pass the following resolution pursuant to Section 129 of the Companies Act, 1965 as ordinary
resolution:
THAT Dato Ahmad Hassan bin Osman who is over the age of seventy years and retiring in accordance
with Section 129 of the Companies Act, 1965, be hereby re-appointed as Director of the Company and
to hold office until the conclusion of the next Annual General Meeting.
Resolution 5
5.
To approve the payment of directors fees of Ringgit Malaysia Two Hundred Thirty Nine Thousand and
Six Hundred (RM239,600) only for the year ended 31 May 2014.
Resolution 6
6.
To re-appoint Messrs. Ernst & Young as Auditors of the Company for the ensuing year and to authorise
the Directors to fix their remuneration.
Resolution 7
AS SPECIAL BUSINESS:7.
To consider and if thought fit, to pass the following resolutions with or without modification: 7.1
ORDINARY RESOLUTION:
AUTHORITY TO ISSUE AND ALLOT SHARES PURSUANT TO SECTION 132D OF THE
COMPANIES ACT, 1965
THAT, subject to Section 132D of the Companies Act, 1965 (Act), the Articles of Association
of the Company, other applicable laws, guidelines, rules and regulations and approvals of
the relevant governmental and/or regulatory authorities, the Directors be and are hereby
empowered to issue and allot shares in the Company, at any time to any person(s) other than a
Director or major shareholder of the Company or person connected with any Director or major
shareholder of the Company and upon such terms and conditions and for such purposes as
the Directors may, in their absolute discretion deem fit, provided that the aggregate number of
shares issued pursuant to this resolution does not exceed ten per centum (10%) of the issued
and paid-up share capital of the Company (excluding treasury shares) for the time being AND
THAT the Directors be and are also empowered to obtain the approval for the listing of and
quotation for the additional shares so issued on Bursa Malaysia Securities Berhad;
AND FURTHER THAT such authority shall commence immediately upon the passing of this
resolution and continue to be in force until the conclusion of the next Annual General Meeting
of the Company.
7.2
ORDINARY RESOLUTION:
PROPOSED RENEWAL AND NEW SHAREHOLDERS MANDATE FOR RECURRENT
RELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE INVOLVING
DATO HWANG THEAN LONG, DATIN CHEAH GAIK HUANG, HWANG SIEW PENG,
SUIWAH HOLDINGS SDN BHD AND SUIWAH SUPERMARKET SENDIRIAN BERHAD
Resolution 8
03
Resolution 9
THAT such approval unless revoked or varied by the Company in general meeting shall continue
to be in full force and effect until:
(i)
the conclusion of the next Annual General Meeting ("AGM") of the Company following
the general meeting at which this mandate was passed, at which time it will lapse,
unless by a resolution passed at the general meeting whereby the authority is renewed;
or
(ii)
the expiration of the period within which the next AGM of the Company after the date
it is required to be held pursuant to Section 143(1) of the Companies Act, 1965 ("the
Act") (but shall not extend to such extension as may be allowed pursuant to Section
143(2) of the Act); or
(iii)
ORDINARY RESOLUTION:
PROPOSED RENEWAL OF SHAREHOLDERS MANDATE FOR RECURRENT RELATED
PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE INVOLVING DATUK
HAJI RADZALI BIN HASSAN AND HOZONE SDN BHD
THAT approval be and is hereby given to the Companys subsidiaries to enter into and give
effect to the recurrent related party transactions of a revenue or trading nature involving Datuk
Haji Radzali bin Hassan and person connected to him, namely Hozone Sdn Bhd (hereinafter
referred to as "Interested Persons") as specified in Section 2.3 under Part A of the Circular
dated 24 October 2014, and falling within the ambit of Part E, Paragraph 10.09 of Chapter
10 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad which are
necessary for the day-to-day operations and undertaken in the ordinary course of business
of the Company, on terms not more favourable to Interested Persons than those generally
available to the public and not detrimental to minority shareholders of the Company;
THAT such approval unless revoked or varied by the Company in general meeting shall continue
to be in full force and effect until:
(i)
the conclusion of the next Annual General Meeting ("AGM") of the Company following
the general meeting at which this mandate was passed, at which time it will lapse,
unless by a resolution passed at the general meeting whereby the authority is renewed;
or
(ii)
the expiration of the period within which the next AGM of the Company after the date
it is required to be held pursuant to Section 143(1) of the Companies Act, 1965 ("the
Act") (but must not extend to such extension as may be allowed pursuant to Section
143(2) of the Act); or
(iii)
Resolution 10
04
ORDINARY RESOLUTION:
PROPOSED RENEWAL OF SHAREHOLDERS MANDATE FOR RECURRENT RELATED
PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE INVOLVING A DIRECTOR
OF THE COMPANYS SUBSIDIARY, NAMELY LOOI TIK MIOW
THAT approval be and is hereby given to the Companys subsidiaries to enter into and give
effect to the recurrent related party transactions of a revenue or trading nature involving a
Director of the Companys subsidiary, namely Looi Tik Miow (hereinafter referred to as
"Interested Director") as specified in Section 2.3 under Part A of the Circular dated 24 October
2014, and falling within the ambit of Part E, Paragraph 10.09 of Chapter 10 of the Main Market
Listing Requirements of Bursa Malaysia Securities Berhad, which are necessary for the dayto-day operations and undertaken in the ordinary course of business of the Company, on terms
not more favourable to Interested Director than those generally available to the public and not
detrimental to minority shareholders of the Company;
Resolution 11
THAT such approval unless revoked or varied by the Company in general meeting shall continue
to be in full force and effect until:
(i)
the conclusion of the next Annual General Meeting ("AGM") of the Company following
the general meeting at which this mandate was passed, at which time it will lapse,
unless by a resolution passed at the general meeting whereby the authority is renewed;
or
(ii)
the expiration of the period within which the next AGM of the Company after the date
it is required to be held pursuant to Section 143(1) of the Companies Act, 1965 ("the
Act") (but must not extend to such extension as may be allowed pursuant to Section
143(2) of the Act); or
(iii)
ORDINARY RESOLUTION:
PROPOSED RENEWAL OF SHAREHOLDERS MANDATE FOR RECURRENT RELATED
PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE INVOLVING A DIRECTOR
OF THE COMPANYS SUBSIDIARY, NAMELY LEONG KONG MENG
THAT approval be and is hereby given to the Companys subsidiaries to enter into and give
effect to the recurrent related party transactions of a revenue or trading nature involving a
Director of the Companys subsidiary, namely Leong Kong Meng (hereinafter referred to as
"Interested Director") as specified in Section 2.3 under Part A of the Circular dated 24 October
2014, and falling within the ambit of Part E, Paragraph 10.09 of Chapter 10 of the Main Market
Listing Requirements of Bursa Malaysia Securities Berhad, which are necessary for the dayto-day operations and undertaken in the ordinary course of business of the Company, on terms
not more favourable to Interested Director than those generally available to the public and not
detrimental to minority shareholders of the Company;
THAT such approval unless revoked or varied by the Company in general meeting shall continue
to be in full force and effect until:
(i)
the conclusion of the next Annual General Meeting ("AGM") of the Company following
the general meeting at which this mandate was passed, at which time it will lapse,
unless by a resolution passed at the general meeting whereby the authority is renewed;
or
(ii)
the expiration of the period within which the next AGM of the Company after the date
it is required to be held pursuant to Section 143(1) of the Companies Act, 1965 ("the
Act") (but must not extend to such extension as may be allowed pursuant to Section
143(2) of the Act); or
(iii)
Resolution 12
05
ORDINARY RESOLUTION:
PROPOSED RENEWAL OF AUTHORITY FOR THE COMPANY TO PURCHASE ITS OWN
SHARES OF UP TO 10% OF ITS ISSUED AND PAID-UP ORDINARY SHARE CAPITAL
("PROPOSED RENEWAL OF SHARE BUY-BACK MANDATE")
THAT subject to the Companies Act, 1965 ("the Act"), the provisions of the Companys
Memorandum and Articles of Association, Main Market Listing Requirements of Bursa Malaysia
Securities Berhad ("Bursa Securities") and all other applicable laws, guidelines, rules and
regulations, the Directors of the Company be and is hereby authorised, to the fullest extent
permitted by law, to purchase such amount of ordinary shares of RM1.00 each in the Company
("SCB Shares") from time to time through Bursa Securities upon such terms and conditions as
the Directors may deem fit and expedient in the interest of the Company provided that:(i)
the aggregate number of SCB Shares which may be purchased or held by the Company
shall not exceed ten per centum (10%) of the total issued and paid-up ordinary share
capital for the time being of the Company, subject to a restriction that the Company
continues to maintain a shareholding spread that is in compliance with the Main Market
Listing Requirements of Bursa Securities after the share purchase;
(ii)
the maximum fund to be allocated by the Company for the purpose of purchasing the
SCB Shares under the Proposed Renewal of Share Buy-Back Mandate shall not exceed
the retained profits and/or the share premium account of the Company for the time being;
Resolution 13
(iii) the authority hereby given shall commence immediately upon passing of this ordinary
resolution and shall continue to be in force until:(a) the conclusion of the next Annual General Meeting ("AGM") of the Company
following the forthcoming AGM, at which time the authority will lapse unless renewed
by ordinary resolution passed at the general meeting, the authority is renewed, either
unconditionally or subject to conditions; or
(b) the expiration of the period within which the next AGM of the Company after the date
it is required by law to be held; or
(c) revoked or varied by ordinary resolution passed by the shareholders of the Company
in a general meeting,
whichever occurs first; but not so as to prejudice the completion of purchase(s) by the
Company of the SCB Shares before the aforesaid expiry date and, made in any event,
in accordance with the provisions of the guidelines issued by Bursa Securities and any
prevailing laws, rules, regulations, orders, guidelines and requirements issued by any
relevant authorities; and
(iv) upon completion of the purchase(s) of the SCB Shares by the Company, authority
be and is hereby given to the Directors of the Company to decide at their absolute
discretion to either to cancel the SCB Shares so purchased and/or to retain the SCB
Shares so purchased as treasury shares which may be distributed as shares dividends
to shareholders and if retained as treasury shares, may resell the treasury shares on
Bursa Securities and/or subsequently cancelled, or to retain part of the SCB Shares so
purchased as treasury shares and cancel the remainder in the manner as prescribed by
the Act, rules, regulations and orders made pursuant to the Act and the requirements of
the Bursa Securities and any other relevant authority for the time being in force;
AND THAT authority be and is hereby unconditionally and generally given to the Directors of the
Company to take all such steps as are necessary or expedient to implement, finalise, complete
or to effect the Proposed Renewal of Share Buy-Back Mandate with full powers to assent to
any conditions, modifications, resolutions, variations and/or amendments (if any) as may be
imposed by the relevant authorities and to do all such acts and things as the said Directors may
deem fit and expedient in the best interest of the Company to give effect to and to complete the
purchase of the SCB Shares.
7.7
ORDINARY RESOLUTION:
MANDATE FOR Y.B. SENATOR DATO HAJI SUHAIMI BIN ABDULLAH WHO HAS
SERVED AS AN INDEPENDENT NON-EXECUTIVE DIRECTOR OF THE COMPANY FOR
A CUMULATIVE TERM OF MORE THAN NINE (9) YEARS, TO CONTINUE TO ACT AS AN
INDEPENDENT NON-EXECUTIVE DIRECTOR OF THE COMPANY
THAT approval be and is hereby given to Y.B. Senator Dato Haji Suhaimi bin Abdullah, who
has served as an Independent Non-Executive Director of the Company for a cumulative term
of more than nine (9) years, to continue to act as an Independent Non-Executive Director
of the Company in compliance with the recommendation of Malaysian Code on Corporate
Governance 2012.
Resolution 14
06
ORDINARY RESOLUTION:
MANDATE FOR DATO AHMAD HASSAN BIN OSMAN WHO HAS SERVED AS AN
INDEPENDENT NON-EXECUTIVE DIRECTOR OF THE COMPANY FOR A CUMULATIVE
TERM OF MORE THAN NINE (9) YEARS, TO CONTINUE TO ACT AS AN INDEPENDENT
NON-EXECUTIVE DIRECTOR OF THE COMPANY
THAT approval be and is hereby given to Dato Ahmad Hassan bin Osman, who has served
as an Independent Non-Executive Director of the Company for a cumulative term of more than
nine (9) years, to continue to act as an Independent Non-Executive Director of the Company
in compliance with the recommendation of Malaysian Code on Corporate Governance 2012.
7.9
Resolution 15
ORDINARY RESOLUTION:
MANDATE FOR MR. JEN SHEK VOON WHO HAS SERVED AS AN INDEPENDENT NONEXECUTIVE DIRECTOR OF THE COMPANY FOR A CUMULATIVE TERM OF MORE
THAN NINE (9) YEARS, TO CONTINUE TO ACT AS AN INDEPENDENT NON-EXECUTIVE
DIRECTOR OF THE COMPANY
THAT approval be and is hereby given to Mr. Jen Shek Voon, who has served as an Independent
Non-Executive Director of the Company for a cumulative term of more than nine (9) years, to
continue to act as an Independent Non-Executive Director of the Company in compliance with
the recommendation of Malaysian Code on Corporate Governance 2012.
Resolution 16
Resolution 17
Shares transferred to the Depositors Securities Account before 4.00 p.m. on 4 December 2014 in respect of ordinary
transfers; and
(b)
Shares bought on the Bursa Malaysia Securities Berhad on a cum entitlement basis according to the Rules of the
Bursa Malaysia Securities Berhad.
07
Resolution No. 8 - Authority to issue and allot shares pursuant to Section 132D of the Companies Act, 1965
The proposed Resolution No. 8 is to seek a renewal of general mandate obtained from its shareholders of the Company
at the last Annual General Meeting (AGM) held on 28 November 2013 (hereinafter referred to as the Previous
Mandate) and which will lapse at the conclusion of the 21st AGM to be held on 17 November 2014.
As at the date this Notice, the Previous Mandate granted by the shareholders had not been utilised and hence, no
proceed was raised therefrom.
The general mandate if passed, will provide flexibility for the Company and empower the Directors of the Company to
issue and allot ordinary shares in the capital of the Company for any fund raising activities, including but not limited to
placing of shares, working capital and/or funding of strategic development of the Group. The renewal of the General
Mandate is sought to provide flexibility and to avoid any delay arising from and cost in convening a general meeting
to obtain approval from its shareholders for such issuance of shares up to an amount not exceeding in total 10% of
the issued and paid-up share capital of the Company, as the Directors consider appropriate in the best interest of the
Company. This General Mandate, unless revoked or varied by the Company in a general meeting, will expire at the
conclusion of next AGM of the Company.
(ii)
Resolution Nos. 9 to 12 - Proposed Renewal and New Shareholders Mandate for the recurrent related party transactions
of a revenue or trading nature (Proposed RRPT Mandate)
The proposed adoption of Resolution Nos. 9 to 12, if passed, will enable the Company and/or its subsidiaries to enter
into the recurrent transactions involving the interest of the Related Parties which are of a revenue or trading nature and
necessary for the Groups day to day operations subject to the transactions being carried out in the ordinary cause of
business on terms not more favorable than those generally available to the public and are not detriment to the minority
shareholders of the Company.
For further information, please refer to the Part A of the Circular/Statement to Shareholders dated 24 October 2014,
which is dispatched together with the Companys Annual Report 2014.
(iii)
(iv)
Resolution No. 14 - Mandate for Y.B. Senator Dato Haji Suhaimi bin Abdullah who has served as an Independent
Non-Executive Director of the Company for a cumulative term of more than nine (9) years, to continue to act as an
Independent Non-Executive Director of the Company
Both the Nomination Committee and the Board have assessed the independence of Y.B. Senator Dato Haji Suhaimi
bin Abdullah, who has served as an Independent Non-Executive Director of the Company for a cumulative term of
more than nine (9) years, and recommended him to continue to serve as an Independent Non-Executive Director of the
Company based on the following justifications:(a) He continues to fulfill the definition of independence as set out in Malaysian Code on Corporate Governance 2012
and Main Market Listing Requirements of Bursa Securities;
(b) His existing tenure in office (despite of more than 9 years) does not impair his independence;
(c) He remains objective and independent in expressing his view and in participating in deliberation and decision
making of the Board and Board Committee(s); and
(d) He continues to demonstrate conduct and behaviour that are essential indicators of independence.
08
Resolution No. 15 - Mandate for Dato Ahmad Hassan bin Osman who has served as an Independent Non-Executive
Director of the Company for a cumulative term of more than nine (9) years, to continue to act as an Independent NonExecutive Director of the Company
Both the Nomination Committee and the Board have assessed the independence of Dato Ahmad Hassan bin Osman,
who has served as an Independent Non-Executive Director of the Company for a cumulative term of more than nine (9)
years, and recommended him to continue to serve as an Independent Non-Executive Director of the Company based
on the following justifications:(a) He continues to fulfill the definition of independence as set out in Malaysian Code on Corporate Governance 2012
and Main Market Listing Requirements of Bursa Securities;
(b) His existing tenure in office (despite of more than 9 years) does not impair his independence;
(c) He remains objective and independent in expressing his view and in participating in deliberation and decision
making of the Board and Board Committee(s); and
(d) He continues to demonstrate conduct and behaviour that are essential indicators of independence.
(vi)
Resolution No. 16 - Mandate for Mr. Jen Shek Voon who has served as an Independent Non-Executive Director of
the Company for a cumulative term of more than nine (9) years, to continue to act as an Independent Non-Executive
Director of the Company
Both the Nomination Committee and the Board have assessed the independence of Mr. Jen Shek Voon, who has
served as an Independent Non-Executive Director of the Company for a cumulative term of more than nine (9) years,
and recommended him to continue to serve as an Independent Non-Executive Director of the Company based on the
following justifications:(a) He continues to fulfill the definition of independence as set out in Malaysian Code on Corporate Governance 2012
and Main Market Listing Requirements of Bursa Securities;
(b) His existing tenure in office (despite of more than 9 years) does not impair his independence;
(c) He remains objective and independent in expressing his view and in participating in deliberation and decision
making of the Board and Board Committee(s); and
(d) He continues to demonstrate conduct and behaviour that are essential indicators of independence.
(vii)
Resolution No. 17 - Mandate for Mr. Wong Thai Sun who has served as an Independent Non-Executive Director of
the Company for a cumulative term of more than nine (9) years, to continue to act as an Independent Non-Executive
Director of the Company
Both the Nomination Committee and the Board have assessed the independence of Mr. Wong Thai Sun, who has
served as an Independent Non-Executive Director of the Company for a cumulative term of more than nine (9) years,
and recommended him to continue to serve as an Independent Non-Executive Director of the Company based on the
following justifications:(a) He continues to fulfill the definition of independence as set out in Malaysian Code on Corporate Governance 2012
and Main Market Listing Requirements of Bursa Securities;
(b) His existing tenure in office (despite of more than 9 years) does not impair his independence;
(c) He remains objective and independent in expressing his view and in participating in deliberation and decision
making of the Board and Board Committee(s); and
(d) He continues to demonstrate conduct and behaviour that are essential indicators of independence.
Notes:
1.
In respect of deposited securities, only members whose names appear in the Record of Depositors on 10 November
2014 (General Meeting Record of Depositors) shall be eligible to attend, speak and vote at the Meeting.
2.
A member entitled to attend and vote at the Meeting is entitled to appoint two (2) or more proxies to attend and vote in
his or her stead. Where a member appoints two (2) proxies, the appointments shall be invalid unless he or she specifies
the proportions of his or her shareholdings to be represented by each proxy.
3.
A proxy may but does not need to be a member. There shall be no restriction as to the qualification of the proxy and
the provision of Section 149 (1)(a), (b) and (c) of the Companies Act, 1965 shall not apply to the Company. A proxy
appointed to attend and vote at the Meeting shall have the same rights as the member to speak at the Meeting.
4.
The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in
writing or, if the appointor is a corporation, either under its seal or under the hand of an officer or attorney duly authorised.
5.
Where a member of the Company is an exempt authorised nominee as defined under Securities Industry (Central
Depositories) Act 1991 which holds ordinary shares in the Company for multiple beneficial owners in one securities
account (omnibus account), there is no limit to the number of proxies which the exempt authorised nominee may
appoint in respect of each omnibus account it holds.
6.
The instrument appointing a proxy and the power of attorney or other authority if any, under which it is signed or a
notarially certified copy of the power or authority shall be deposited at the registered office of the Company at No. 1-201 SUNTECH @ Penang Cybercity, Lintang Mayang Pasir 3, 11950 Bayan Baru, Penang not less than forty-eight (48)
hours before the time for holding the meeting or any adjournment thereof.
09
STATEMENT ACCOMPANYING THE NOTICE OF ANNUAL GENERAL MEETING
(Pursuant to Paragraph 8.27(2) of the Main Market Listing Requirements of Bursa Securities)
As at date of this notice, there are no individuals who are standing for election as Directors (excluding the above Directors who
are standing for re-election or re-appointment) at this forthcoming 21st Annual General Meeting.
10
CORPORATE INFORMATION
BOARD OF DIRECTORS
DATO HWANG THEAN LONG - Managing Director
DATIN CHEAH GAIK HUANG - Executive Director
MS. HWANG SIEW PENG - Executive Director
DATUK HAJI RADZALI BIN HASSAN - Non-Independent Non-Executive Director
Y.B. SENATOR DATO HAJI MOHD SUHAIMI BIN ABDULLAH - Independent Non-Executive Director
DATO AHMAD HASSAN BIN OSMAN - Independent Non-Executive Director
MR. WONG THAI SUN - Independent Non-Executive Director
MR. JEN SHEK VOON - Independent Non-Executive Director
AUDIT COMMITTEE
Y.B. SENATOR DATO HAJI MOHD SUHAIMI BIN ABDULLAH - Chairman
DATO AHMAD HASSAN BIN OSMAN - Member
MR. WONG THAI SUN - Member
MR. JEN SHEK VOON - Member
NOMINATION COMMITTEE
DATO AHMAD HASSAN BIN OSMAN - Chairman
Y.B. SENATOR DATO HAJI MOHD SUHAIMI BIN ABDULLAH - Member
MR. WONG THAI SUN - Member
REMUNERATION COMMITTEE
DATO AHMAD HASSAN BIN OSMAN - Chairman
Y.B. SENATOR DATO HAJI MOHD SUHAIMI BIN ABDULLAH - Member
MR. WONG THAI SUN - Member
COMPANY SECRETARY
THUM SOOK FUN (MIA 24701)
REGISTERED OFFICE
No. 1-20-1 SUNTECH @ Penang Cybercity, Lintang Mayang Pasir 3, 11950 Bayan Baru, Penang, Malaysia.
Tel. No. : +604-6437387
Fax No. : +604-6437389
Web Page : http://www.suiwah.com.my
SHARE REGISTRAR
SECURITIES SERVICES (HOLDINGS) SDN BHD
Suite 18.05, MWE Plaza, No. 8, Lebuh Farquhar, 10200 Penang, Malaysia.
Tel. No. : +604-2631966
Fax No. : +604-2628544
AUDITORS
ERNST & YOUNG (AF0039)
Chartered Accountants
21st Floor, MWE Plaza, No. 8, Lebuh Farquhar, 10200 Penang, Malaysia.
ADVOCATES & SOLICITORS
GHAZI & LIM
NG SEE KEE & LEONG
WONG-CHOOI & MOHD. NOR
ROWENA YAM, KHOO & ASSOCIATES
PRINCIPAL BANKERS
OCBC BANK (MALAYSIA) BERHAD
MALAYAN BANKING BERHAD
STOCK EXCHANGE LISTING
Main Market of Bursa Malaysia Securities Berhad
Stock Code
: 9865
Stock Name
: SUIWAH
11
FINANCIAL HIGHLIGHTS
2011
RM000
2012
RM000
2013
RM000
2014
RM000
422,263
381,010
372,335
378,165
18,973
12,622
19,187
14,845
Paid up Capital
61,000
61,000
61,000
61,000
118,234
119,917
129,922
144,210
Revenue
Reserves
Revenue
RM'000
430,000
RM'000
25,000
420,000
20,000
410,000
400,000
350,000
340,000
14,845
19,187
18,973
5,000
12,622
360,000
378,165
10,000
372,335
370,000
381,010
380,000
15,000
422,263
390,000
0
2011
2012
2013
2014
2011
Year
2012
2013
2014
Year
Reserves
Paid-up Capital
RM'000
70,000
RM'000
160,000
60,000
140,000
120,000
50,000
40,000
10,000
2011
2012
129,922
60,000
119,917
20,000
80,000
118,234
61,000
61,000
61,000
61,000
30,000
144,210
100,000
40,000
20,000
0
0
2011
2012
Year
2013
2014
Year
2013
2014
12
DIRECTORS PROFILE
DATO HWANG THEAN LONG - Managing Director
Aged 65, Malaysian
Dato' Hwang Thean Long was appointed to the Board on 10 December 1992. He is presently the Managing Director of the
Company and also acting as director of the subsidiary companies namely Crimson Omega Sdn Bhd, PT Sunshine Amanjaya
Indonesia, Qdos Holdings Bhd, Qdos Marketing Sdn Bhd, Sunshine (Labuan) Private Limited, Sunshine Supermarket &
Departmental Store Sdn Bhd and Sunshine Wholesale Mart Sdn Bhd.
He has more than 43 years of experience in business industry especially supermarket retailing. He started his career with
a mini market when he joined his father, the late Mr. Hwang Siong Wah, the founder of the well-known Swee Wah general
merchant at Ayer Itam, Penang in 1970. After taking over the Swee Wah general merchant, he has expanded the business
by opening additional outlets, which comprise of Sunshine Square, Sunshine Farlim Shopping Mall, Suiwah Ayer Itam and
Sunshine Lip Sin. His current directorship in other public company includes Penang Commercial and Industrial Development
Berhad.
He is also a major shareholder of the Company by virtue of his interests held through Suiwah Holdings Sdn Bhd and Suiwah
Supermarket Sendirian Berhad in the Company. He is the spouse of Datin Cheah Gaik Huang, an Executive Director of the
Company and the father of Ms. Hwang Siew Peng who is also an Executive Director of the Company.
Dato' Hwang Thean Long attended all the five (5) Board Meetings held during the financial year ended 31 May 2014.
Y.B. SENATOR DATO HAJI MOHD SUHAIMI BIN ABDULLAH - Independent Non-Executive Director
Aged 56, Malaysian
Y.B. Senator Dato' Haji Mohd Suhaimi Bin Abdullah was appointed to the Board on 10 December 1992. He is presently the
Chairman of the Audit Committee and a member of the Nomination and Remuneration Committee of the Company. He is also
a director of the subsidiary companies namely Crimson Omega Sdn Bhd and Qdos Holdings Bhd.
He graduated from Havering Technical College, London in 1981 with Diploma in Business Studies. Subsequently, he obtained
a professional qualification in the Chartered Institute of Transport from School of Transport, University of London in 1985 and
is a member of the Chartered Institute of Transport since 1989. From 1982 to 1984, while he was completing his studies, he
was engaged as a secretary with the Majlis Pelajar-Pelajar Malaysia in London, UK. There, he managed the administrative
and communicative matters between Ministries of Malaysia, which have contact with the Malaysian Students Societies Council
in the UK and Ireland.
From 1984 to 1985, he was employed as a Marketing Executive in Mafeta Travel Agency Limited, London, UK where he
managed the sales and marketing of air tickets for Malaysia and Far East countries. From 1985 to 1987, the Foundation of
Mara Education engaged him as an Assistant Secretary II, where he handled the administrative matters of the foundation.
Also in 1986, he joined Angkatan Seniman Abad XX Sdn Bhd as an Executive Director. He was in charged of all administrative
and financial matters for the company, which produced feature films and sitcoms for local media. Then in 1987, he joined
YPM Realities Sdn Bhd as a General Manager and subsequently joined Yayasan Bumiputera Pulau Pinang Berhad also as
a General Manager in 1991. He was in charge of the overall management and day-to-day operations of the companies. He
currently is the Managing Director and Chief Executive Officer of Silver Ridge Holdings Bhd.
Y.B. Senator Dato' Haji Mohd Suhaimi Bin Abdullah attended four (4) of the five (5) Board Meetings held during the financial
year ended 31 May 2014.
13
14
Save for the family relationship as disclosed above, none of the above Directors have any family relationship with
other Directors and/or major shareholders of the Company. None of the above Directors have any conflict of interest
with the Company or any conviction for any offences other than traffic offences within the past ten (10) years.
15
MANAGING DIRECTORS STATEMENT
On behalf of the Board of Directors, I have the pleasure to present to you the Annual Report of Suiwah Corporation Bhd. (the
Company) and its group of companies (the Group) for the financial year ended 31 May 2014.
FINANCIAL OVERVIEW
During the financial year ended 31 May 2014 (FY2014), the Groups revenue stood at RM378.17 million which constitutes a
1.57% increase over last years revenue of RM372.33 million, mainly contributed by its retail segment which recorded higher
revenue for FY2014 in conjunction with the opening of new retail outlet during the year.
However, the Groups profit before tax decreased by 22.67% from RM19.19 million recorded in previous financial year to
RM14.84 million for FY2014. The decrease was mainly due to higher operating expenses incurred for the retail segment in
conjunction with the opening of the new retail outlet during the year and for the manufacturing segment, it was due amortization
of intangible assets, patent license fair value adjustment and unrealized forex loss incurred during the year.
After providing for taxation, the Groups earnings per share improved from 24.23 sen in previous financial year to 30.99 sen
for FY2014.
The Companys shareholders funds have improved from RM99.49 million as at 31 May 2013 to RM108.12 million as at 31
May 2014. The total Groups bank short term borrowings stood at RM6.67 million as at 31 May 2014 compared with RM13.41
million as at 31 May 2013.
DIVIDEND
The Company had declared and paid a first and final dividend of 8% less 25% taxation amounting to RM3.44 million for the
FY2013.
After reviewing the Group performance for FY2014, the Board of Directors is pleased to recommend a first and final single tier
dividend of 6% for the FY2014. The proposed final dividend will be tabled for the shareholders approval at the forthcoming
Twenty-first Annual General Meeting to be held on 17 November 2014.
OPERATIONS REVIEW
Retail Segment
Managing a group of retail stores is much more sophisticated endeavor than it sometimes appeared. The business is very
much people driven which is the basis for the Group to move the business forward. A smiling face communicates a very
positive and strong support to the retail segment and the Group will embark on providing top notch training in sales, customer
service, product/service knowledge and operating procedures to further enhance its retail business performance.
In addition, the retail segment will also be concentrating on multi-channel retailing for seamless approach to enhancing
consumer experience through specialized strategy software and technological devices. Consumers nowadays are very much
in control of the supply chain; hence multi-channel retailing is a revolution for the retail segment to be more consumers centric.
Manufacturing Segment
The Groups manufacturing segment recorded higher profit for FY2014, mainly due to improved operational efficiency and
higher technology content in the products and services to its increasing number of customers.
Lean management and driving towards enhanced technological capabilities continues to be the main drivers to value-add the
manufacturing segment. We foresee strong growth prospect in flexible printed circuits and IC substrate industry, with the rising
popularity of phablets and the emergence of Internet of Things (IoT).
Property Investment and Development Segment
The Groups property investment and development segment recorded a satisfactory performance for FY2014 as compared to
the previous financial year.
The Group is in the process of developing the Sunshine Tower project on a 9-acres land in Farlim, Penang. Sunshine Tower
is set to be the next happening leisure and entertainment venue in the northern region.
16
17
STATEMENT ON CORPORATE SOCIAL RESPONSIBILITY (CSR)
As much as we are fair and just in all our business practices, we also maintained an unwavering commitment towards the
community and environment. In year 2014, the Group carried out many corporate social responsibility activities and few are
worth to be highlighted as follows:
PC Recycling Program
On 8 September 2013, Sunshine launched a PC Recycling Program, a joint effort with Dell Asia Pacific Sdn Bhd, Penang
Municipal Council and IRM Industries Sdn Bhd in reducing e-wastes which are hazardous to the environment. A total of
2,379 kg of used computers and accessories were collected from 80 participants in this 4 hours event held at Sunshine
Square Bayan Baru.
18
STATEMENT ON CORPORATE SOCIAL RESPONSIBILITY (CSR)
(CONTD.)
19
The following paragraphs describe how the Group has applied the Principles of the Code and how the Board has complied with
the recommendations set out in the Code for the financial year ended 31 May 2014.
Principle 1 - Establish Clear Roles and Responsibilities
1.1
Board should establish clear functions reserved for Board and those to delegated to Management
The Board has been entrusted with the overall responsibility for the overall governance, strategic direction and
overseeing the investments of the Group.
The Board retains full and effective control of the Group and assumes responsibility for determining the Groups
strategies and direction, shareholders and investors relationship, approval of annual and quarterly financial results,
acquisition and disposal, major capital expenditure as well as reviewing the adequacy and integrity of the Groups
system of internal controls.
1.2
Board should establish clear roles and responsibilities in discharging its fiduciary and leadership functions
Currently, the position of the Chairman of the Company is vacant subsequent to the demise of the late Tun Dato Seri
Utama Dr. Lim Chong Eu. In this respect, the Board will elect among themselves to chair its meeting. The Chairman
of the Board Meeting is primarily responsible for orderly conduct of a Board Meeting whilst the Managing Director
is responsible for the day-to-day business operations and implementation of Board policies and decisions. Hence,
there is a clear division of responsibility between the Chairman and Managing Director to ensure there is a balance
of power and authority. None of the members of the Board has unfettered powers of decision.
The Board comprises of the Managing Director, two (2) Executive Directors, one (1) Non-Independent Non-Executive
Director and four (4) Independent and Non-Executive Directors, all of whom bring to the Group a broad and valuable
range of experience. There was a strong independent element on the Board as 50% of its Board members comprises
of Independent and Non-Executive Directors.
The presence of Independent and Non-Executive Directors in the Board provides objectivity and they are of the
caliber necessary to carry sufficient weight in Board decisions. The role of the Independent and Non-Executive
Directors is particularly important in ensuring that the strategies proposed by the management are fully discussed
and examined, and takes into account the long-term interests, not only of the shareholders, but also of employees,
customers, suppliers, and the many communities in which the Group conducts business.
The Group Managing Director is responsible for the day to day management of the business and operations of the
Company and Group. He is supported by a management team to ensure the operations are carried out smoothly.
The Board meets regularly at least four (4) times a year. At the end of every quarter, the Groups financial statements
and results are tabled and deliberated by the Board. During the Board Meeting, the Board reviews the operation and
performance of the Group and any other strategic issues that may affect the Groups business.
20
Formalise ethical standards through a code of conduct and ensure its compliance
The Board has in place a code of ethics for the Directors. The code includes amongst of others the respect for the
individual, create a culture of open and honest communication, set tone at the top, uphold the law, avoid conflict of
interest, set metrics and report results accurately.
The Board conducted themselves in an ethical manner while executing their duties and functions, and complied with
the Companys Code of Ethics recommended by the Companies Commission of Malaysia.
In addition to the Company Directors Code of Ethics established by Companies Commission of Malaysia, both
Directors and employees are required to uphold the highest integrity in discharging their duties and in dealings with
various stakeholders such as shareholders, customers, fellow employees and regulators.
1.4
1.5
1.6
1.7
21
Establish a Nominating Committee (NC) which should comprise exclusively Non-Executive Directors, a
majority of whom must be independent
The NC of the Company was established on 29 April 2002. The NC comprises three (3) Non-Executive Directors,
majority of who are Independent Non-Executive Directors as follows:
Chairman
Dato Ahmad Hassan Bin Osman (Independent Non-Executive Director)
Members
Y.B. Senator Dato Haji Mohd Suhaimi Bin Abdullah (Independent Non-Executive Director)
Mr. Wong Thai Sun (Independent Non-Executive Director)
The NC had convened one meeting during the financial year 2014.
2.2
NC should develop, maintain and review criteria for recruitment process and annual assessment of Directors
The NC is empowered to bring to the Board, recommendations as to the appointment of any new Director or to fill
board vacancies as and when they arise in making its recommendation, the NC will consider the required mix of skills,
knowledge, expertise, experience and other qualities, including core competencies which should bring to the Board.
The duties and functions of the NC are as follows: (i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
(ix)
(x)
(xi)
(xii)
To review the structure, size and composition (including skills, knowledge and experience) required of the
Board compared to its current position and make recommendations to the Board with regard to any changes.
To give full consideration to succession planning for directors in the course of its works, taking into account
the challenges and opportunities facing the company, and what skills and expertise are therefore needed on
the Board in the future.
To review and recommend to the Board, candidates to fill board vacancies as and when they arise.
To prepare a description of the role and capabilities required for a particular appointment with thorough
evaluation and considerations of the following criteria: skills, knowledge, expertise and experience;
competencies, commitment, contribution and performance;
professionalism;
integrity; and
the case of candidates for the position of Independent Non-Executive Directors, the Committee shall
also evaluate the candidates ability to discharge such responsibilities/function as are expected from
Independent Non-Executive Directors.
To review and recommend the re-appointment of any Non-Executive Director at the conclusion of their term
office having given due regard to their performance and ability to continue to contribute to the Board in the
light of the knowledge, skills and experience required.
To ensure the Board composition meets the needs of the Company.
To develop, maintain and review the criteria to be used in the recruitment process and annual assessment
of Directors.
To review and recommend to the Board, candidates to fill the seats on Board committees.
To assist the Board to annually review its required mix of skills and experience and other qualities including
core competencies, which Non-Executive Directors should bring to the Board.
To assess the effectiveness of the Board as a whole and Committees of the Board and assess the
contribution of each individual Director, including the Independent Non-Executive Directors, as well as the
Chief Executive Officer.
To review and recommend the re-appointment and re-election of Directors of the Company for shareholders
approval.
To facilitate Board induction and training programmes.
The Board was of the view that the performance appraisal and assessment on the Board is not applicable to the
Group as all the Board are already subject to the retirement by rotation at least once in every three (3) years but
eligible for re-election by the shareholders at the Annual General Meeting (AGM) of the Company. The assessment
of Boards performance shall be dependent on the shareholders review before they decide to vote for or against the
re-election of the retiring Directors at the AGM.
While the Board recognizes the initiatives by the government to enlarge the womens representation at boardroom,
the Board composition comprise of two (2) female Directors out of the eight (8) Directors.
During the financial year 2014, the NC conducted an assessment of the Directors who are subject to retirement at the
forthcoming AGM in accordance with the provisions of the Articles of Association of the Company and the relevant
provisions of the Companies Act, 1965.
22
Board should establish formal and transparent remuneration policies and procedures to attract and retain
Directors
The Remuneration Committee of the Company comprises a majority of non-executive directors and its composition
is as follows:Chairman
Dato Ahmad Hassan Bin Osman (Independent Non-Executive Director)
Members
Y.B. Senator Dato Haji Mohd Suhaimi Bin Abdullah (Independent Non-Executive Director)
Mr. Wong Thai Sun (Independent Non-Executive Director)
The Remuneration Committee is primarily responsible for recommending the policy and framework of directors
remuneration, including the terms and remuneration of the executive directors, to the Board in order to align with the
business strategy and long term objectives of the Company. The remuneration of directors is determined at levels
which enable the Company to attract and retain Directors with the relevant experience and expertise to govern the
Group effectively.
During the financial year 2014, the Remuneration Committee had performed its duty to assess annually the
remuneration package of its Executive Directors and proposed the remuneration of Executive Directors to the Board
for consideration.
In the case of Executive Directors, the remuneration comprises salary, allowances and bonus. The fees payable to
Non-Executive Directors are approved by shareholders at each AGM. All Directors are also paid allowance for each
meeting they attend.
The details of the Directors remuneration for the financial year ended 31 May 2014 are as follows:
Company
Category of Remuneration
Directors Fees
Salaries, Bonus and Other Emoluments
Meeting Allowance
Total
Group
Executive
Directors
NonExecutive
Directors
Executive
Directors
NonExecutive
Directors
(RM)
(RM)
(RM)
(RM)
174,600
65,000
177,600
74,000
462,276
18,000
50,000
18,000
50,000
192,600
115,000
657,876
124,000
The number of Directors whose remuneration falls into each successive band of RM50,000 is as follows:
Range of Remuneration
Number of Directors
Executive Directors
Non-Executive Directors
Below RM50,000
RM50,001- RM100,000
RM100,001- RM150,000
RM300,001- RM350,000
Above RM350,000
Total
23
3.2
Tenure of Independent Director should not exceed cumulative term of nien (9) years. Upon completion of
tenure, Independent Director can continue serving but as Non-Executive Director
One of the recommendation of the Code states that the tenure of an Independent Director should be capped at nine
(9) years, either be a consecutive service of nine (9) years or a cumulative service of nine (9) years with intervals.
Upon completion of the nine (9) years tenure in office, an Independent Director may continue to serve on the company
subject to the re-designation as a Non-Independent Director.
Currently, the following Independent Directors, who have served the Company as Independent Non-Executive
Directors for a cumulative term more than nine (9) years are: (i)
Y.B. Senator Dato Haji Mohd Suhaimi Bin Abdullah
(ii)
Dato Ahmad Hassan Bin Osman
(iii)
Mr. Wong Thai Sun
(iv)
Mr. Jen Shek Voon
However, the NC and the Board have assessed the independence of Y.B. Senator Dato Haji Mohd Suhaimi Bin
Abdullah, Dato Ahmad Hassan Bin Osman, Mr. Wong Thai Sun and Mr. Jen Shek Voon are satisfied with the skills,
contribution and independent judgment that the said independent Directors bring to the Board and was of the view
that the said Independent Directors remain objective and independent in expressing their views and in participating
in deliberations and decision making of the Board and Board Committees. The length of their service on the Board
does not in any way interfere with their exercise of independent judgment and ability to act in the best interests of the
Company.
As all the members of NC have acted as Independent Directors for the tenure in office for more than a cumulative
term of nine (9) years and in line with Recommendation 3.2 of MCCG 2012, the Board (save for Y.B. Senator Dato
Haji Mohd Suhaimi Bin Abdullah, Dato Ahmad Hassan Bin Osman, Mr. Wong Thai Sun and Mr. Jen Shek Voon
who have abstained themselves from deliberation and forming the opinion on the subject matter) recommends and
supports them to continue to act as an Independent Non-Executive Directors of the Company. The relevant motion
on the subject matter will be presented to the shareholders for consideration at the forthcoming AGM.
3.3
Must justify and seek shareholders approval in retaining Independent Directors (serving more than 9 years)
This was explained in the foregoing section.
3.4
3.5
The Board must comprise majority Independent Directors if the Chairman is not an Independent Director
It is recommended that the Board must comprise a majority of Independent Directors where the position of the
Chairman is not an Independent Director. The Board currently comprises all Non-Executive Directors, of whom
four (4) out of eight (8) directors are Independent Non-Executive Directors. The Board therefore has a strong
independence element in its composition as there is a balance of membership in the Board thus ensuring that no
individual dominates the decision making process and the results thereof.
24
Board should set expectations on time commitment for its members and protocols for accepting new
directorships
The Board is satisfied with the level of time commitment given by the Directors towards fulfilling their roles and
responsibilities as Directors of the Company.
The Board would have at least four (4) regular scheduled meetings annually, with additional meetings convened as
and when necessary.
A total of five (5) Board meetings were held in financial year ended 31 May 2014. The following is the record of
attendance by the Board members during the financial year:Name of Directors
% of Attendance
100
100
100
80
100
100
100
60
Executive Directors
In the intervals between Board meetings, for exceptional matters requiring urgent Board decisions, the Board
decisions are obtained via circular resolutions to which sufficient information required is attached to facilitate the
Board in making informed decisions.
4.2
Board should ensure members have access to appropriate continuing education programme
All Directors have attended the Mandatory Accreditation Programme (MAP) as required by Bursa Malaysia Securities
Berhad (Bursa Securities) on all directors of listed companies.
The Directors are also encouraged to attend the relevant training courses deemed necessary so as to keep abreast
with the changes on guidelines issued by the relevant authorities as well as the latest developments in the market
place, which can complement their services to the Group. The Directors are also updated by the Company Secretary
on any changes to legal and governance requirements of the Group.
The Directors will continue to undergo other relevant training programmes from time to time to enhance their skills
and knowledge where relevant. The training programmes attended by the individual Directors during the financial
year ended 31 May 2014 are as follows:
Title of the seminars, workshops or courses attended
Y.B. Senator Dato Haji Mohd Suhaimi Bin Abdullah
Enhanced Understanding of Risk Management and Internal Control
Workshop
Emotional Intelligence in Action
Dato Ahmad Hassan Bin Osman
Enhanced Understanding of Risk Management and Internal Control
Workshop
International Seminar on Development and Finance in Jeddah,
Saudi Arabia
Transformational Leadership in Malaysia
Mode of Training
No. of hours /
days spent
Workshop
8 hours
Seminar
16 hours
Workshop
8 hours
Seminar
7 days
Seminar
16 hours
25
Mode of Training
No. of hours /
days spent
Workshop
8 hours
Classroom
Classroom
KPDNKK Seminar
MITI Seminar
3 days
3 days
8 hours
8 hours
Seminar
Seminar
Seminar
LHDNMMEF Seminar
Seminar
16 hours
8 hours
8 hours
8 hours
Workshop
8 hours
Study Tour
Seminar &
Conference
Forum
16 hours
3 days
16 hours
8 hours
Messrs. Jen Shek Voon and Wong Thai Sun have completed the Continuing Professional Education requirements for
their respective accounting professional bodies for which they are members of. In addition to the above and during the
financial year 2014, the Directors were updated on the amendments to the Listing Requirements of Bursa Securities.
Save as disclosed above, the other Directors have not attended any trainings during the financial year under review,
due to their respective tight traveling schedules and busy/heavy work commitments. Nevertheless, they are kept
abreast with new statutory or regulatory development and various operational issues facing the changing business
environment within the Group.
Principle 5: Uphold integrity in financial reporting
5.1
Audit Committee should ensure financial statements comply with applicable financial reporting standards
The Board acknowledges their responsibility to ensure that the financial statements of the Company and the Group
are prepared in accordance with the provisions of the Companies Act, 1965 and approved accounting standards in
Malaysia so as to give a true and fair view of the state of affairs and the result of the Company and of the Group.
5.2
Audit Committee should have policies and procedures to assess suitability and independence of External
Auditors
A transparent and appropriate relationship with the External Auditors to enable them to independently report to
shareholders in accordance with statutory and professional requirement is established through the Audit Committee.
The role of the Audit Committee members and their relationship with the External Auditors may be found in the Audit
Committee Report in the Annual Report.
The Audit Committee has obtained a written assurance from the external auditors confirming that they were, and
has been, independent throughout the conduct of the audit engagement in accordance with the terms of all relevant
professional and regulatory requirements.
The Audit Committee is satisfied with the competence and independence of the external auditors and had
recommended the re-appointment of the external auditors to the Directors at the Annual General Meeting.
The Audit Committee also met with the External Auditors twice during the financial year ended 2014 without the
presence of Management and Executive Directors in compliance with the best practices of the Code.
26
6.2
Board should establish an internal audit function which reports directly to Audit Committee
It is the responsibility of the Board to maintain sound system of internal controls to safeguard shareholders investment.
The Internal Audit function of the Group has been outsourced to a professional firm who is assisting the Audit
Committee in discharging its duties and responsibilities. The role of the Internal Audit is to provide the Audit Committee
with independent assessment for adequate, efficient and effective internal control system to ensure compliance
with policies and procedures. The Internal Audit function is also involved in risk management, risk evaluation and
recommendation of control activities to manage such identified risk. The attainment of such objectives involves the
following activities being carried out by the Internal Auditors:
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
(ix)
Reviewing and appraising the soundness, adequacy and application of accounting, financial and other
controls and promoting effective control in the Company and the Group at reasonable cost.
Ascertaining the extent to whom the Groups and the Companys assets are accounted for and safeguarded
from losses of all kinds.
Attending stock counts of merchandise.
Appraising the reliability and usefulness of information developed within the Group and the Company for
management reporting purposes.
Carrying out audit work and to liaise with the external auditors to maximise the use of resources and for
effective coverage of audit risks.
Recommending improvement to the existing systems of controls.
Carrying out investigations and special reviews requested by management and/or the Audit Committee of
the Company.
Continuously identifying opportunity for improvement in the operations of business processes of the
Company and the Group.
Discuss with management action taken to improve the system of internal control.
The Internal Auditors attended the meetings and reported directly to the Audit Committee on the internal audit reports
during the financial year. The Internal Auditors tabled their audit findings on inventory management and procurement
and risk assessment 2014 to the Audit Committee.
The total costs of the internal audit function in respect of the financial year ended 31 May 2014 was RM23,800 only.
Principle 7: Ensure timely and high quality disclosure
7.1
27
8.2
8.3
Board should promote effective communication and proactive engagements with shareholders
In maintaining the commitment to effective communication with shareholders, the Group adopts the practice
of comprehensive, timely and continuing disclosures of information to its shareholders as well as to the general
investing public. The practice of disclosure of information is not just established to comply with the requirements of
the Listing Requirements. It also adopts the recommendations of the Code with regard to strengthening engagement
and communication with shareholders. Where possible and applicable, the Group also provides additional disclosure
of information on a voluntary basis. The Group believes that consistently maintaining a high level of disclosure and
extensive communication with its shareholders is vital to shareholders and investors to make informed investment
decisions.
The Annual Report is the main channel of communication between the Company and its stakeholders. The Annual
Report communicates comprehensive information of the financial results and activities undertaken by the Group.
As a listed issuer, the contents and disclosure requirements of the annual report are also governed by the Listing
Requirements.
Another key avenue of communication with its shareholders is the Companys AGM, which provides a useful forum
for shareholders to engage directly with the Companys Directors. At each AGM, the Directors of the Company would
be present at the meetings to answer any questions that the shareholders may ask. The Chairman of the meeting
provided time for the shareholders to ask questions for each agenda in the notice of the AGM. The External Auditors
were also present at the AGM to answer any questions that the shareholders may ask. The shareholders were also
able to meet with the Directors after the meeting while they mingled with the shareholders, proxies and corporate
representatives.
Compliance Statement
The Board is satisfied that in financial year 2014, save for the above relevant explanations, the Company is in compliance with
principles and recommendations of the Code.
This statement is made in accordance with the resolution of the Board dated 22 September 2014.
28
29
The Audit Committee was established by the Board of Directors (the Board) of the Company on 21 June 1995.
(ii)
The Board shall ensure that the composition and functions of the Audit Committee comply as far as possible with the
Bursa Malaysia Securities Berhads (Bursa Securities) Main Market Listing Requirements (Listing Requirements)
as well as other regulatory requirements.
Objectives
The principal objectives of the Audit Committee are to assist the Board in discharging its statutory duties and responsibilities
relating to accounting and financial reporting practices of the Company and its subsidiaries. In addition, the Audit Committee
shall:
(i)
evaluate the quality of the audits performed by the Internal and External Auditors;
(ii)
provide assurance that the financial information presented by Management is relevant, reliable and timely;
(iii)
oversee compliance with laws and regulations and observance of a proper code of conduct; and
(iv)
determine the quality, adequacy and effectiveness of the Groups control environments and quality of the audits.
Membership
The Audit Committee shall be appointed by the Board from amongst its Directors which fulfill the following requirements:
(i)
The Audit Committee must be composed of no fewer than three (3) members;
(ii)
All the Audit Committee members must be Non-Executive Directors, with a majority of members must be independent.
No alternate Director is to be appointed as a member of the Audit Committee.
(iii)
The Chairman of the Audit Committee shall be appointed among the members of the Audit Committee who shall be an
Independent Director. In the absence of the Audit Committee Chairman and/or an appointed deputy, the remaining Audit
Committee members present shall elect one of themselves to chair the Audit Committee meeting.
Mr. Wong Thai Sun is a member of the MIA and the Certified Public Accountants, Australia. Mr. Jen Shek Voon is a practicing
member of the Institute of Certified Public Accountants, Singapore and a member of Information System Audit and Control
Association, British Computer Society, a member of Institute of Internal Auditors and MIA.
30
The Audit Committee shall meet at least four (4) times a year, with due notice of issues to be discussed, and shall
record its conclusions in discharging its duties and responsibilities and at such times as and when necessary.
(ii)
A quorum for the Audit Committee meeting shall consist of a majority of Independent Non-Executive Directors and
shall not be less than two (2). For the purpose of this provision, any Audit Committee members who is able (directly
or by telephone communication) to speak and shall be entitled to vote or be counted in quorum accordingly.
(iii)
Upon the request of the External Auditors, the Chairman of the Audit Committee shall convene a meeting of the Audit
Committee to consider any matter the External Auditors believe should be brought to the attention of the Directors or
Shareholders.
(iv)
Notice of Audit Committee meetings shall be given to all the Audit Committee members unless the Audit Committee
waives such requirement.
(v)
The Finance Manager, the Head of Internal Audit and representatives of the External Auditors shall normally attend
meetings. Other Board members and employees may attend meetings upon the invitation of the Audit Committee.
However, the Audit Committee shall meet with the External Auditors, the Internal Auditors or both, without other Board
members and Management present whenever deemed necessary.
(vi)
Questions arising at any meeting of the Audit Committee shall be decided by a majority of votes of the members
present, and in the case of equality of votes, the Chairman of the Audit Committee shall have a second or casting
vote.
(vii)
During the financial year ended 31 May 2014, five (5) Audit Committee meetings were held. Details of attendance of each Audit
Committee member were as follows:No. of the Audit Committee
Meetings Attended
% of Attendance
100
100
100
100
Name of Directors
Authority
The Audit Committee shall, in accordance with a procedure to be determined by the Board and at the expense of the Company,
(i)
have explicit authority to investigate any matter within its terms of reference, the resources to do so, and full access
to information. All employees shall be directed to co-operate as requested by members of the Audit Committee.
(ii)
have full and unlimited/unrestricted access to all information and documents/resources which are required to perform
its duties as well as to the Internal and External Auditors and Senior Management of the Company and Group.
(iii)
obtain independent professional or other advice and to invite outsiders with relevant experience to attend, if necessary.
(iv)
have direct communication channels with the External Auditors and person(s) carrying out the internal audit function
or activity.
Where the Audit Committee is of the view that the matter reported by it to the Board has not been satisfactorily resolved
resulting in a breach of the Listing Requirements, the Audit Committee shall promptly report such matter to Bursa Securities.
31
(ii)
to discuss with the External Auditors before the audit commences the nature and scope of the audit, ensure coordination where more than one (1) audit firm is involved;
(iii)
to review with the External Auditors their evaluation of the system of internal controls and their audit report;
(iv)
to review the Companys quarterly/financial report and annual financial statements before submission to the Board,
focusing particularly on:
(a)
the consistency of and any changes to the accounting policies and practices;
(b)
major judgemental areas;
(c)
significant adjustments resulting from the audit;
(d)
the going concern assumption; and
(e)
compliance with accounting standards and other legal and regulatory bodies requirements.
(v)
to review any related party transactions and conflict of interest situation that may arise within the Company or the
Group, including any transaction, procedure or course of conduct that raises questions of management integrity;
(vi)
to discuss problems and reservations arising from the interim and final Audits, and any matter the auditor may wish
to discuss (in the absence of Management, where necessary);
(vii)
(viii)
(ix)
to verify the allocation of options pursuant to the Employees Share Option Scheme (ESOS) in compliance with the
criteria as stipulated in the by-law of ESOS of the Company, if any;
(x)
to review the cost effectiveness, independence and objectivity of the External Auditors and recommend for the
appointment/re-appointment of the External Auditors, the audit fee and any questions of resignation or dismissal
of the External Auditors to the Board, to be put to Shareholders for approval at the general meeting in relation to
appointment, re-appointment and dismissal of the Companys External Auditors;
(xi)
to establish policies governing the circumstances under which the contract in relation to the provision of non-audit
services can be entered into by the Group with its External Auditors and procedures that need to be adhered;
(xii)
to review the adequacy and effectiveness of risk management and internal control systems instituted within the
Group;
(xiii)
to report its findings on the financial and management performance, and other material matters to the Board;
(xiv)
to consider the major findings of internal investigations and Managements response; and
(xv)
to consider other functions as may be agreed to by the Audit Committee and the Board of Directors.
32
Review of the quarterly unaudited consolidated financial statements before recommending them for the Boards
approval;
Review of the annual consolidated financial statements of the Group and to discuss issues with the External Auditors
before submission to the Board for approval;
Review the accounting issues arising from the updates of the new developments on accounting standards issued by
Malaysian Accounting Standard Board;
Review of the related party transactions of the Company and its subsidiaries;
Review the internal audit reports, which highlighted the audit issues, recommendation and managements response;
Review of the External Auditors management letter and Managements response; and
Review the External Auditors scope of work and plans for the year.
Reviewing and appraising the soundness, adequacy and application of accounting, financial and other controls and
promoting effective control in the Company and the Group at reasonable cost.
Ascertaining the extent to whom the Groups and the Companys assets are accounted for and safeguarded from
losses of all kinds.
Attending stock counts of merchandise.
Appraising the reliability and usefulness of information developed within the Group and the Company for management
reporting purposes.
Carrying out audit work and to liaise with the External Auditors to maximise the use of resources and for effective
coverage of audit risks.
Recommending improvement to the existing systems of controls.
Carrying out investigations and special reviews requested by the Management and/or the Audit Committee of the
Company.
Continuously identifying opportunity for improvement in the operations of business processes of the Company and
the Group.
Discuss with management action taken to improve the system of internal control.
This statement is made in accordance with the resolution of the Board dated 22 September 2014.
33
The Board is required to prepare audited financial statements which give a true and fair view of the state of affairs of the Group
and the Company at the end of each financial year and of their results and their cash flows for that year then ended.
In preparing the financial statements for the year ended 31 May 2014, the Board considers that:
(i)
(ii)
the Group and the Company have used appropriate accounting policies and have consistently applied them;
(iii)
(iv)
the financial statements were prepared on the going concern basis as the Board has a reasonable expectation, having
made enquiries, that the Group and the Company have adequate resources to continue in operational existence for
the foreseeable future.
The Board is responsible for ensuring that the Group and the Company maintain accounting records which disclose with
reasonable accuracy the financial position of the Group and the Company, and which enable them to ensure that the financial
statements comply with the Companies Act, 1965.
The Board has general responsibilities for taking such steps that are reasonably available to them to safeguard the assets of
the Group, and to prevent and detect fraud and other irregularities.
This statement is made in accordance with the resolution of the Board dated 22 September 2014.
34
OTHER INFORMATION
REQUIRED BY THE MAIN MARKET LISTING REQUIREMENTS OF BURSA MALAYSIA SECURITIES BERHAD
Utilisation of Proceeds
No proceeds were raised by the Company from any corporate exercise during the financial year and no new shares being
issued by the Company during the financial year based on the general mandate granted by the shareholders pursuant to
Section 132D of the Companies Act, 1965 at the last Annual General Meeting of the Company.
Share Buy-back
During the financial year ended 31 May 2014, the details of its ordinary shares of RM1.00 each (SCB Shares) bought back
by the Company are as follows:
Buy Back Price Per
SCB Share
(RM)
Lowest
Highest
August 2013
1.81
1.81
1.81
12,000
21,720.00
January 2014
1.93
1.93
1.93
3,000
5,790.00
15,000
27,510.00
Monthly Breakdown
Total:
Total Cost*
(RM)
35
OTHER INFORMATION
REQUIRED BY THE MAIN MARKET LISTING REQUIREMENTS OF BURSA MALAYSIA SECURITIES BERHAD (CONTD.)
Nature of Transaction
SHSB
Suiwah Supermarket
Sendirian Berhad (SSSB)
Dato Hwang Thean Long
Datin Cheah Gaik Huang
Ms. Hwang Siew Peng
RM269,810
SHSB
SSSB
Dato Hwang Thean Long
Datin Cheah Gaik Huang
Ms. Hwang Siew Peng
RM48,000
SHSB
SSSB
Dato Hwang Thean Long
Datin Cheah Gaik Huang
Ms. Hwang Siew Peng
RM24,000
RM336
10
SHSB
SSSB
Dato Hwang Thean Long
Datin Cheah Gaik Huang
Ms. Hwang Siew Peng
Mr. Leong Kong Meng
RM949,576
11
SHSB
SSSB
Dato Hwang Thean Long
Datin Cheah Gaik Huang
Ms. Hwang Siew Peng
Mr. Leong Kong Meng
RM2,032
12
SHSB
SSSB
Dato Hwang Thean Long
Datin Cheah Gaik Huang
Ms. Hwang Siew Peng
RM26,765
13
SHSB
SSSB
Dato Hwang Thean Long
Datin Cheah Gaik Huang
Ms. Hwang Siew Peng
RM10,800
RM1,943,316
36
DIRECTORS REPORT
The directors have pleasure in presenting their report together with the audited financial statements of the Group and of the
Company for the financial year ended 31 May 2014.
Principal activities
The principal activities of the Company are investment holding, provision of management services and letting of property.
The principal activities of the subsidiaries, joint venture and associate are described in Notes 17, 18 and 19 to the financial
statements.
There have been no significant changes in the nature of the principal activities during the financial year.
Results
Group
RM
Company
RM
17,900,713
12,101,610
17,763,907
136,806
17,900,713
12,101,610
12,101,610
There were no material transfers to or from reserves or provisions during the financial year other than as disclosed in the
financial statements.
In the opinion of the directors, the results of the operations of the Group and of the Company during the financial year were
not substantially affected by any item, transaction or event of a material and unusual nature other than as disclosed in the
financial statements.
Dividend
The amount of dividend paid by the Company since 31 May 2013 was as follows:
RM
3,439,329
At the forthcoming Annual General Meeting, a first and final single tier dividend of 6% in respect of the current financial year
ended 31 May 2014, on 57,314,448 ordinary shares (the number of outstanding ordinary shares in issue of the Company as
at 31 May 2014 after the set off with 3,685,800 ordinary shares bought back by the Company and held as treasury shares
subsequent to year end) amounting to RM3,438,867 (6 sen net per share) will be proposed for shareholders' approval. The
financial statements for the current financial year do not reflect this proposed dividend. Such dividends when approved by the
shareholders will be accounted for in equity as an appropriation of retained earnings in the financial year ending 31 May 2015.
Directors
The names of the directors of the Company in office since the date of the last report and at the date of this report are:
Dato' Hwang Thean Long
Y.B. Senator Dato' Haji Mohd Suhaimi bin Abdullah *
Dato' Ahmad Hassan bin Osman *
Datin Cheah Gaik Huang
Hwang Siew Peng
Wong Thai Sun *
Jen Shek Voon ^
Datuk Haji Radzali bin Hassan
*
^
37
The Company
Direct interest
Dato' Hwang Thean Long
Dato' Haji Mohd Suhaimi bin Abdullah
Datin Cheah Gaik Huang
Indirect interest
Dato' Hwang Thean Long *
Hwang Siew Peng **
Datuk Haji Radzali bin Hassan ***
31 May
2014
4,445,381
417,125
26,400
4,445,381
417,125
26,400
10,959,105
15,430,886
12,117,948
10,959,105
15,430,886
12,117,948
26,400
15,404,486
26,400
15,404,486
Indirect interest
Interest of Spouse/Children of the Directors ^
Dato Hwang Thean Long
Datin Cheah Gaik Huang
*
By virtue of his interests in shares of Suiwah Holdings Sdn. Bhd. and Suiwah Supermarket Sendirian Berhad, both
companies incorporated in Malaysia, Dato' Hwang Thean Long is deemed to have an interest in the shares of the
Company and all its subsidiaries to the extent both these companies have interests.
**
By virtue of the interests of her parents, Dato' Hwang Thean Long and Datin Cheah Gaik Huang, Hwang Siew Peng
is deemed to have an interest in the shares of the Company and all its subsidiaries to the extent her parents have
interests.
***
By virtue of his interest in shares of Hozone Sdn. Bhd. ("Hozone"), a company incorporated in Malaysia, Datuk Haji
Radzali bin Hassan is deemed to have an interest in the shares of the Company, and all its subsidiaries to the extent
Hozone has an interest.
Disclosure pursuant to Section 134 (12) (c) of the Companies Act 1965
None of the other directors in office at the end of the financial year had any interest in shares in the Company or its related
corporations and share options of the Company during the financial year.
38
(b)
Before the statements of comprehensive income and statements of financial position of the Group and of the Company
were made out, the directors took reasonable steps:
(i)
to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of
provision for doubtful debts and satisfied themselves that all known bad debts had been written off and that
no provision for doubtful debts was necessary in the financial statements of the Group. The directors were
also satisfied that there were no known bad debts and that adequate provision for doubtful debts has been
made in the financial statements of the Company; and
(ii)
to ensure that any current assets which were unlikely to realise their values as shown in the accounting
records in the ordinary course of business had been written down to an amount which they might be expected
so to realise.
At the date of this report, the directors are not aware of any circumstances which would render:
(i)
the amount written off for bad debts inadequate to any substantial extent or it necessary to make any provision
for doubtful debts in the financial statements of the Group nor they are aware of any circumstances which
would render it necessary to write off any bad debts or the amount of the provision for doubtful debts in the
financial statements of the Company inadequate to any substantial extent; and
(ii)
the values attributed to the current assets in the financial statements of the Group and of the Company
misleading.
(c)
At the date of this report, the directors are not aware of any circumstances which have arisen which would render
adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or
inappropriate.
(d)
At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this report
or financial statements of the Group and of the Company which would render any amount stated in the financial
statements misleading.
(e)
(f)
(i)
any charge on the assets of the Group and of the Company which have arisen since the end of the financial
year which secures the liabilities of any other person; or
(ii)
any contingent liability of the Group and of the Company which have arisen since the end of the financial year.
no contingent or other liability has become enforceable or is likely to become enforceable within the period
of twelve months after the end of the financial year which will or may affect the ability of the Group or of the
Company to meet their obligations when they fall due; and
(ii)
no item, transaction or event of a material and unusual nature has arisen in the interval between the end of
the financial year and the date of this report which is likely to affect substantially the results of the operations
of the Group or of the Company for the financial year in which this report is made.
39
40
STATEMENT BY DIRECTORS
We, Dato' Hwang Thean Long and Wong Thai Sun, being two of the directors of Suiwah Corporation Bhd., do hereby
state that, in the opinion of the directors, the accompanying financial statements set out on pages 43 to 107 are drawn
up in accordance with Malaysian Financial Reporting Standards, International Financial Reporting Standards and the
requirements of the Companies Act 1965 in Malaysia so as to give a true and fair view of the financial position of the
Group and of the Company as at 31 May 2014 and of their financial performance and cash flows for the year then ended.
The information set out in Note 46 to the financial statements on page 108 have been prepared in accordance with the
Guidance on Special Matter No.1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure
Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants.
Signed on behalf of the Board in accordance with a resolution of the directors dated 26 September 2014.
STATUTORY DECLARATION
I, Dato' Hwang Thean Long, being the director primarily responsible for the financial management of Suiwah Corporation Bhd.,
do solemnly and sincerely declare that the accompanying financial statements set out on pages 43 to 108 are in my opinion
correct, and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the
Statutory Declarations Act 1960.
Subscribed and solemnly declared by the
abovenamed Dato' Hwang Thean Long
at Georgetown in the state of Penang
on 26 September 2014
Before me,
MOK CHENG YOON
PJK
NO. P140
Commissioner for Oaths
41
We are satisfied that the financial statements of the subsidiaries that have been consolidated with the financial statements
of the Company are in form and content appropriate and proper for the purposes of the preparation of the consolidated
financial statements and we have received satisfactory information and explanations required by us for those purposes.
(d) The auditors reports on the financial statements of the subsidiaries were not subject to any qualification and did not
include any comment required to be made under Section 174(3) of the Act.
Other Reporting Responsibilities
The supplementary information set out in Note 46 on page 108 is disclosed to meet the requirement of Bursa Malaysia
Securities Berhad. The directors are responsible for the preparation of the supplementary information in accordance with
Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure
Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants ("MIA
Guidance") and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared,
in all material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.
42
Other Matters
This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the 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.
43
Note
Revenue
Other operating income
Changes in inventories of merchandise, finished
goods and work-in-progress
Raw materials and consumable goods used
Inventories purchased
Cost of inventory property
Employee benefits expense
Inventories written down/off
Reversal of inventories written down
Amortisation of intangible asset
Amortisation of land use rights
Commission
Depreciation of:
- property, plant and equipment
- investment property
Net loss on financial assets at
fair value through profit or loss
Reversal/(Impairment loss) on
investment in a subsidiary
Promotional expenses
Property, plant and equipment written off
Operating leases - minimum lease payment for:
- land and buildings
- equipment and machinery
Subcontract charges
Upkeep and maintenance
Utilities
Other operating expenses
Operating profit
Finance costs
Share of profit/(loss) in a joint venture
Profit before tax
Income tax benefit/(expense)
Profit net of tax
4
5
22
6
16
15
13
14
17
8
9
10
11
Group
2014
RM
2013
RM
Company
2014
RM
6,547,320
7,917,588
2013
RM
378,165,018
2,744,203
372,334,550
1,891,639
878,834
(28,963,877)
(261,512,839)
(2,834,809)
(25,402,214)
157,494
(374,070)
(215,266)
(1,403,018)
6,151,223
(30,099,756)
(263,009,754)
(22,968,308)
(553,092)
(215,266)
(1,380,393)
(193,110)
-
(192,600)
-
(10,496,176)
-
(9,851,927)
-
(972)
(473,171)
(1,106)
(473,171)
(170,859)
(25,338)
(5,216,191)
(46,967)
(4,489,626)
(185,753)
342,276
-
(3,472,493)
(42,000)
(4,905,718)
(4,590,964)
(9,873,083)
(6,465,488)
15,959,517
(1,172,674)
57,768
14,844,611
3,056,102
17,900,713
(2,326,378)
(102,000)
(5,882,726)
(4,451,348)
(8,474,771)
(6,997,400)
19,363,576
(172,005)
(4,627)
19,186,944
(5,490,184)
13,696,760
(37,344)
(443,660)
(1,602)
(521,492)
13,616,837
13,616,837
(1,515,227)
12,101,610
13,735,220
331,351
(28,334)
(1,547)
(5,673,635)
7,696,178
7,696,178
(1,660,071)
6,036,107
17,863,369
13,253,100
12,101,610
6,036,107
17,763,907
136,806
17,900,713
13,890,365
(193,605)
13,696,760
12,101,610
12,101,610
6,036,107
6,036,107
17,726,563
136,806
17,863,369
13,446,705
(193,605)
13,253,100
12,101,610
12,101,610
6,036,107
6,036,107
30.99
24.23
The accompanying accounting policies and explanatory information form an integral part of the financial statements.
44
Assets
Non-current assets
Property, plant and equipment
Investment property
Land use rights
Intangible asset
Investments in subsidiaries
Investment in a joint venture
Investment in an associate
Investment securities
Goodwill on consolidation
Current assets
Inventory property
Inventories
Trade and other receivables
Other current assets
Tax recoverable
Loan receivables
Short term investments
Cash and bank balances
Note
Group
2014
RM
2013
RM
Company
2014
RM
2013
RM
13
14
15
16
17
18
19
20
21
131,662,728
41,143
6,531,830
12,068,371
3,114
4,665,045
154,972,231
115,731,758
256,409
6,905,900
12,068,577
3,114
4,665,045
139,630,803
3,135
23,500,291
68,298,619
91,802,045
4,107
23,973,462
59,256,344
83,233,913
22
23
24
25
23,525,714
33,736,041
21,591,575
505,849
4,275,057
84,236
24,309,096
27,844,565
135,872,133
290,844,364
26,166,480
33,511,211
24,205,914
398,315
675,660
28,730
13,698,835
32,199,611
130,884,756
270,515,559
34,991,436
14,932
3,213,822
38,220,190
130,022,235
36,273,636
14,932
4,008,160
40,296,728
123,530,641
29
29
29
30
31
61,000,248
(5,374,381)
13,934,711
(2,912,370)
133,187,216
199,835,424
875,834
200,711,258
61,000,248
(5,346,718)
13,934,711
(2,875,026)
118,862,638
185,575,853
807,232
186,383,085
61,000,248
(5,374,381)
13,934,711
38,564,257
108,124,835
108,124,835
32
33
36
34
114,583
11,370,090
6,299,262
1,703,446
19,487,381
164,583
1,480,354
6,064,296
2,621,026
10,330,259
35
32
33
36
37
256,517
50,000
6,659,164
61,196,999
1,712,534
770,511
70,645,725
90,133,106
290,844,364
256,517
50,000
13,411,210
56,468,627
1,316,804
2,299,057
73,802,215
84,132,474
270,515,559
21,838,164
59,236
21,897,400
21,897,400
130,022,235
23,837,928
202,496
24,040,424
24,040,424
123,530,641
26
27
28
Total assets
Equity and liabilities
Equity attributable to equity holders of the Company
Share capital
Treasury shares
Share premium
Other reserves
Retained earnings
Non-controlling interests
Total equity
Non-current liabilities
Government grant
Borrowings
Trade and other payables
Deferred tax
Current liabilities
Provision for liabilities
Government grant
Borrowings
Trade and other payables
Deferred revenue
Tax payable
Total liabilities
Total equity and liabilities
61,000,248
(5,346,718)
13,934,711
29,901,976
99,490,217
99,490,217
The accompanying accounting policies and explanatory information form an integral part of the financial statements.
61,000,248
At 31 May 2014
61,000,248
At 1 June 2013
61,000,248
At 31 May 2013
(5,374,381)
(27,663)
(5,346,718)
(5,346,718)
(29,820)
(5,316,898)
RM
RM
61,000,248
shares
capital
At 1 June 2012
Group
Treasury
Share
13,934,711
13,934,711
13,934,711
13,934,711
RM
premium
Share
Non-distributable
(2,912,370)
(37,344)
(2,875,026)
(2,875,026)
(443,660)
(2,431,366)
RM
reserves
Other
133,187,216
(3,439,329)
17,763,907
118,862,638
118,862,638
(3,441,189)
13,890,365
108,413,462
RM
earnings
Retained
Distributable
199,835,424
(27,663)
(3,439,329)
17,726,563
185,575,853
185,575,853
(29,820)
(3,441,189)
13,446,705
175,600,157
RM
Total
Non-
875,834
(68,204)
136,806
807,232
807,232
(193,605)
1,000,837
RM
interests
controlling
200,711,258
(27,663)
(3,507,533)
17,863,369
186,383,085
186,383,085
(29,820)
(3,441,189)
13,253,100
176,600,994
RM
equity
Total
45
46
Non-distributable
Distributable
Share
Treasury
Share
Other
Retained
Total
capital
shares
premium
reserves
earnings
equity
RM
RM
RM
RM
RM
RM
13,934,711
27,307,058
96,925,119
Company
At 1 June 2012
61,000,248
(5,316,898)
6,036,107
6,036,107
(3,441,189)
(3,441,189)
(29,820)
At 31 May 2013
61,000,248
(5,346,718)
13,934,711
29,901,976
99,490,217
At 1 June 2013
61,000,248
(5,346,718)
13,934,711
29,901,976
99,490,217
12,101,610
12,101,610
(3,439,329)
(3,439,329)
(27,663)
61,000,248
(5,374,381)
13,934,711
38,564,257
At 31 May 2014
(29,820)
(27,663)
108,124,835
The accompanying accounting policies and explanatory information form an integral part of the financial statements.
47
Group
Note
Company
2014
2013
2014
2013
RM
RM
RM
RM
14,844,611
19,186,944
13,616,837
7,696,178
Operating activities
Profit before tax
Adjustments for:
- Amortisation of:
- government grant
(50,000)
(50,000)
15
215,266
215,266
- intangible assets
16
374,070
34,317
466,265
Depreciation of:
- property, plant and equipment
13
10,496,176
9,851,927
972
1,106
- investment property
14
473,171
473,171
Finance costs
1,172,674
Interest income
(835,610)
172,005
(595,610)
(4,830,636)
(84,409)
(11,838,536)
(71,191)
553,092
170,859
25,338
(157,494)
17
(342,276)
28,334
(42,114)
46,967
185,753
5,183,179
(7,833,179)
(260,160)
(172,744)
213,646
(57,768)
4,627
30,229,253
1,000,480
1,212,081
3,305,298
4,372,738
26,039,210
2,640,766
Decrease in receivables
2,697,260
(107,534)
(67,336)
4,963,338
(198,123)
(2,006)
6,620,053
16,005
(29,611)
395,730
38,952
36,561,434
44,366,165
1,016,485
1,182,470
Interest paid
(1,172,674)
Interest received
835,610
(172,005)
595,610
84,409
71,191
Tax paid
(2,989,422)
(4,795,548)
(458,488)
(282,441)
33,234,948
39,994,222
642,406
971,220
48
Group
Note
Company
2014
2013
2014
2013
RM
RM
RM
RM
(39,230)
243,227
19,000
Investing activities
Increase in deposits pledged to banks
(10,738)
(933)
(10,781,120)
(9,882,227)
316,727
16
13
3,630,636
10,571,402
(6,905,900)
(26,748,726)
(28,862,248)
(37,224,790)
(45,427,378)
3,630,636
10,571,402
(915,546)
Financing activities
Proceeds from/(Repayment of) term loan, net
10,696,012
(68,204)
12
(3,439,329)
(3,441,189)
(3,439,329)
(3,441,189)
29
(27,663)
(29,820)
(27,663)
(29,820)
9,115,380
(29,665,541)
1,583,767
1,742,398
8,744,583
(2,644,157)
(5,067,380)
(12,406,978)
4,754,741
(8,077,313)
(794,338)
(864,356)
(10,715,768)
20,729,572
20,631
195,072
22,225,522
30,107,763
4,008,160
4,872,516
27,000,894
22,225,522
3,213,822
4,008,160
28
The accompanying accounting policies and explanatory information form an integral part of the financial statements.
49
1.
Corporate information
The Company is a public limited liability company, incorporated and domiciled in Malaysia and listed on the Main
Market of Bursa Malaysia Securities Berhad ("Bursa Malaysia"). The registered office of the Company is located at
No. 1-20-1 SUNTECH @ Penang Cybercity, Lintang Mayang Pasir 3, 11950 Bayan Baru, Penang.
The principal activities of the Company are investment holding, provision of management services and letting of
property. The principal activities of the subsidiaries, joint venture and associate are described in Notes 17, 18 and 19.
There have been no significant changes in the nature of the principal activities during the financial year.
2.
2.1
Basis of preparation
The financial statements of the Group and of the Company have been prepared in accordance with Malaysian
Financial Reporting Standards ("MFRS"), International Financial Reporting Standards ("IFRS") and the requirements
of the Companies Act 1965 in Malaysia.
The financial statements have been prepared on a historical cost basis except those disclosed below in the accounting
policies.
The financial statements are presented in Ringgit Malaysia ("RM").
2.2
Description
Amendments to MFRS 101: Presentation of Items of Other
Comprehensive Income
MFRS 3: Business Combinations (IFRS 3: Business Combinations
issued by IASB in March 2004)
MFRS 10: Consolidated Financial Statements
MFRS 11: Joint Arrangements
MFRS 12: Disclosure of interests in Other Entities
MFRS 13: Fair Value Measurement
MFRS 119: Employee Benefits (IAS 19 as amended by IASB in June 2011)
MFRS 127: Separate Financial Statements (IAS 27 as amended
by IASB in May 2011)
MFRS 127: Consolidated and Separate Financial Statements
(IAS 27 as revised by IASB in December 2003)
MFRS 128: Investment in Associate and Joint Ventures (IAS 28 as
amended by IASB in May 2011)
IC Interpretation 20: Stripping Costs in the Production Phase of
a Surface Mine
Amendments to MFRS 1: Government Loans
Annual Improvements 2009-2011 Cycle
Amendments to MFRS 7: Disclosures Offsetting Financial Assets
and Financial Liabilities
Amendments to MFRS 10, MFRS 11 and MFRS 12: Consolidated
Financial Statements, Joint Arrangements and Disclosure of Interests
in Other Entities: Transition Guidance
Effective for
financial periods
beginning on or after
1 July 2012
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
1 January 2013
50
2.
2.2
(ii)
the investor has exposure, or rights, to variable returns from its involvement with the investee, and
(iii)
the investor has ability to use its power over the investee to affect the amount of the investor's returns.
Under MFRS 127 Consolidated and Separate Financial Statements, control was defined as the power to govern the
financial and operating policies of an entity so as to obtain benefits from its activities.
MFRS 10 includes detailed guidance to explain when an investor that owns less than 50 per cent of the voting shares
in an investee has control over the investee. MFRS 10 requires the investor to take into account all relevant facts
and circumstances, particularly the size of the investors holding of voting rights relative to the size and dispersion of
holdings of the other vote holders.
The application of MFRS 10 has no impact on the Groups and the Companys financial position or financial
performance.
MFRS 11 Joint Arrangements
MFRS 11 replaces MFRS 131 Interests in Joint Ventures and IC Interpretation 113 Jointly-Controlled Entities Nonmonetary Contributions by Venturers.
The classification of joint arrangements under MFRS 11 is determined based on the rights and obligations of the
parties to the joint arrangements by considering the structure, the legal form, the contractual terms agreed by the
parties to the arrangement and when relevant, other facts and circumstances. Under MFRS 11, joint arrangements
are classified as either joint operations or joint ventures.
A joint operation is a joint arrangement whereby the parties that have joint control of the arrangement have rights
to the assets, and obligations for the liabilities, relating to the arrangement. A joint venture is a joint arrangement
whereby the parties that have joint control of the arrangement have rights to the net assets of the arrangement.
MFRS 11 removes the option to account for jointly controlled entities (JCE) using proportionate consolidation.
Instead, JCE that meet the definition of a joint venture must be accounted for using the equity method. This standard
has no material impact on the Group's financial position or performance.
MFRS 12 Disclosures of Interests in Other Entities
MFRS 12 includes all disclosure requirements for interests in subsidiaries, joint arrangements, associates and
structured entities. A number of new disclosures are required. This standard affects disclosures only and has no
impact on the Groups financial position or performance.
51
2.
2.2
2.3
1 January 2014
1 January 2014
1 January 2014
1 January 2014
1 January 2014
1 July 2014
1 July 2014
52
2.
2.3
Description
Annual improvements to MFRSs 2011 - 2013 cycle
Amendments to MFRS 11: Accounting for Acquisitions of
Interests in Joint Operations
Amendments to MFRS 116 and MFRS 138: Clarification of
Acceptable Methods of Depreciation and Amortisation
Amendments to MFRS 116 and MFRS 141: Agriculture:Bearer Plants
MFRS 14 Regulatory Deferral Accounts
MFRS 15 Revenue from Contracts with Customers
MFRS 9 Financial Instruments (IFRS 9 issued by IASB in November 2009)
MFRS 9 Financial Instruments (IFRS 9 issued by IASB in October 2010)
MFRS 9 Financial Instruments: Hedge Accounting and
amendments to MFRS 9, MFRS 7 and MFRS 139
Effective for
financial periods
beginning on or after
1 July 2014
1 January 2016
1 January 2016
1 January 2016
1 January 2016
1 January 2017
To be announced
To be announced
To be announced
The directors expect that the adoption of the standards and interpretations will have no material impact on the financial
statements in the period of initial application except as discussed below:
MFRS 9 Financial Instruments
MFRS 9 reflects the first phase of work on the replacement of MFRS 139 and applies to classification and measurement
of financial assets and financial liabilities as defined in MFRS 139. The standard was initially effective for annual
periods beginning on or after 1 January 2013, but Amendments to MFRS 9: Mandatory Effective Date of MFRS 9 and
Transition Disclosures, issued in March 2012, moved the mandatory effective date to 1 January 2015. Subsequently,
on 14 February 2014, it was announced that the new effective date will be decided when the project is closer to
completion. The adoption of the first phase of MFRS 9 will have an effect on the classification and measurement of
the Groups financial assets, but will not have an impact on classification and measurements of the Groups financial
liabilities. The Group will quantify the effect in conjunction with the other phases, when the final standard including all
phases is issued.
2.4
Basis of consolidation
The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at
the reporting date. The financial statements of the subsidiaries used in the preparation of the consolidated financial
statements are prepared for the same reporting date as the Company. Consistent accounting policies are applied to
like transactions and events in similar circumstances.
The Company controls an investee if and only if the Company has all the following:
(i)
Power over the investee (i.e existing rights that give it the current ability to direct the relevant activities of the
investee);
(ii)
Exposure, or rights, to variable returns from its investment with the investee; and
(iii)
The ability to use its power over the investee to affect its returns.
When the Company has less than a majority of the voting rights of an investee, the Company considers the following
in assessing whether or not the Companys voting rights in an investee are sufficient to give it power over the investee:
(i)
The size of the Companys holding of voting rights relative to the size and dispersion of holdings of the other
vote holders;
(ii)
Potential voting rights held by the Company, other vote holders or other parties;
53
2.
2.4
(iv)
Any additional facts and circumstances that indicate that the Company has, or does not have, the current
ability to direct the relevant activities at the time that decisions need to be made, including voting patterns at
previous shareholders meetings.
Subsidiaries are consolidated when the Company obtains control over the subsidiary and ceases when the Company
loses control of the subsidiary. All intra-group balances, income and expenses and unrealised gains and losses
resulting from intra-group transactions are eliminated in full.
Losses within a subsidiary are attributed to the non-controlling interests even if that results in a deficit balance.
Changes in the Groups ownership interests in subsidiaries that do not result in the Group losing control over the
subsidiaries are accounted for as equity transactions. The carrying amounts of the Groups interests and the noncontrolling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. The resulting
difference is recognised directly in equity and attributed to owners of the Company.
When the Group loses control of a subsidiary, a gain or loss calculated as the difference between (i) the aggregate
of the fair value of the consideration received and the fair value of any retained interest and (ii) the previous carrying
amount of the assets and liabilities of the subsidiary and any non-controlling interest, is recognised in profit or loss.
The subsidiarys cumulative gain or loss which has been recognised in other comprehensive income and accumulated
in equity are reclassified to profit or loss or where applicable, transferred directly to retained earnings. The fair value of
any investment retained in the former subsidiary at the date control is lost is regarded as the cost on initial recognition
of the investment.
2.5
54
2.
2.6
Subsidiaries
A subsidiary is an entity over which the Company has all the following:
(i)
Power over the investee (i.e existing rights that give it the current ability to direct the relevant activities of the
investee);
(ii)
Exposure, or rights, to variable returns from its investment with the investee; and
(iii)
The ability to use its power over the investee to affect its returns.
In the Companys separate financial statements, investments in subsidiaries are accounted for at cost less any
accumulated impairment losses. On disposal of such investments, the difference between net disposal proceeds and
their carrying amounts is included in profit or loss.
2.7
55
2.
2.8
Intangible assets
(a)
Goodwill
Goodwill is initially measured at cost. Following initial recognition, goodwill is measured at cost less any
accumulated impairment losses.
For the purpose of impairment testing, goodwill acquired is allocated, from the acquisition date, to each of the
Groups cash-generating units that are expected to benefit from the synergies of the combination.
The cash-generating unit to which goodwill has been allocated is tested for impairment annually and
whenever there is an indication that the cash-generating unit may be impaired, by comparing the carrying
amount of the cash-generating unit, including the allocated goodwill, with the recoverable amount of the
cash-generating unit. Where the recoverable amount of the cash-generating unit is less than the carrying
amount, an impairment loss is recognised in the profit or loss. Impairment losses recognised for goodwill are
not reversed in subsequent periods.
Where goodwill forms part of a cash-generating unit and part of the operation within that cash-generating
unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount
of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in this
circumstance is measured based on the relative fair values of the operations disposed of and the portion of
the cash-generating unit retained.
Goodwill and fair value adjustments arising on the acquisition of foreign operation on or after 1 January 2006
are treated as assets and liabilities of the foreign operations and are recorded in the functional currency
of the foreign operations and translated in accordance with the accounting policy set out in Note 2.26.
Goodwill and fair value adjustments which arose on acquisitions of foreign operation before 1 January 2006
are deemed to be assets and liabilities of the Company and are recorded in RM at the rates prevailing at the
date of acquisition.
(b)
56
2.
2.9
5% - 6%
1.27%
2% - 18%
10% - 20%
10% - 20%
20% - 33.3%
10% - 20%
Capital work-in-progress are not depreciated as these assets are not yet available for use.
The carrying values of property, plant and equipment are reviewed for impairment when events or changes in
circumstances indicate that the carrying value may not be recoverable.
The residual value, useful life and depreciation method are reviewed at each financial year-end, and adjusted
prospectively, if appropriate.
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are
expected from its use or disposal. Any gain or loss on derecognition of the asset is included in profit or loss in the year
the asset is derecognised.
2.10
Investment properties
Investment properties are measured at cost model which is to measure investment properties at cost less accumulated
depreciation and any accumulated impairment losses.
Depreciation is computed on a straight-line basis over the estimated useful lives of the assets as follows:
Buildings
1% - 2%
A property interest under an operating lease is classified and accounted for as an investment property on a propertyby-property basis when the Group holds it to earn rentals or for capital appreciation or both. Any such property interest
under an operating lease classified as an investment property is carried at fair value.
Investment properties are derecognised when either they have been disposed of or when the investment property is
permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gain or loss on the
retirement or disposal of an investment property is recognised in profit or loss in the year of retirement or disposal.
Transfers are made to or from investment property only when there is a change in use.
2.11
Inventory property
Property acquired or being constructed for sale in the ordinary course of business, rather than to be held for rental
or capital appreciation, is held as inventory property and is measured at the lower of cost and net realisable value.
Net realisable value is the estimated selling price in the ordinary course of the business, based on market prices at
the reporting date and discounted for the time value of money if material, less costs to completion and the estimated
costs of sale.
The cost of inventory property recognised in profit or loss on disposal is determined with reference to the specific costs
incurred on the property sold and an allocation of any non-specific costs based on the relative size of the property
sold.
57
2.
2.12
2.13
Financial assets
Financial assets are recognised in the statements of financial position when, and only when, the Group and the
Company become a party to the contractual provisions of the financial instrument.
When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not
at fair value through profit or loss, directly attributable transaction costs.
The Group and the Company determine the classification of their financial assets at initial recognition, and the categories
include financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments and
available-for-sale financial assets.
(a)
58
2.
2.13
(c)
Held-to-maturity investments
Financial assets with fixed or determinable payments and fixed maturity are classified as held-to-maturity
when the Group has the positive intention and ability to hold the investment to maturity.
Subsequent to initial recognition, held-to-maturity investments are measured at amortised cost using the
effective interest method. Gains and losses are recognised in profit or loss when the held-to-maturity
investments are derecognised or impaired, and through the amortisation process.
Held-to-maturity investments are classified as non-current assets, except for those having maturity within 12
months after the reporting date which are classified as current.
(d)
A financial asset is derecognised when the contractual right to receive cash flows from the asset has expired. On
derecognition of a financial asset in its entirety, the difference between the carrying amount and the sum of the
consideration received and any cumulative gain or loss that had been recognised in other comprehensive income is
recognised in profit or loss.
Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the
period generally established by regulation or convention in the marketplace concerned. All regular way purchases
and sales of financial assets are recognised or derecognised on the trade date i.e., the date that the Group and the
Company commit to purchase or sell the asset.
59
2.
2.14
Trade and other receivables and other financial assets carried at amortised cost
To determine whether there is objective evidence that an impairment loss on financial assets has been
incurred, the Group and the Company consider factors such as the probability of insolvency or significant
financial difficulties of the debtor and default or significant delay in payments. For certain categories of
financial assets, such as trade receivables, assets that are assessed not to be impaired individually are
subsequently assessed for impairment on a collective basis based on similar risk characteristics. Objective
evidence of impairment for a portfolio of receivables could include the Groups and the Company's past
experience of collecting payments, an increase in the number of delayed payments in the portfolio past the
average credit period and observable changes in national or local economic conditions that correlate with
default on receivables.
If any such evidence exists, the amount of impairment loss is measured as the difference between the assets
carrying amount and the present value of estimated future cash flows discounted at the financial assets
original effective interest rate. The impairment loss is recognised in profit or loss.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets
with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance
account. When a trade receivable becomes uncollectible, it is written off against the allowance account.
If in a subsequent period, the amount of the impairment loss decreases and the decrease can be related
objectively to an event occurring after the impairment was recognised, the previously recognised impairment
loss is reversed to the extent that the carrying amount of the asset does not exceed its amortised cost at the
reversal date. The amount of reversal is recognised in profit or loss.
(b)
2.15
Financial liabilities
Financial liabilities are classified according to the substance of the contractual arrangements entered into and the
definitions of a financial liability.
Financial liabilities, within the scope of MFRS 139, are recognised in the statements of financial position when, and only
when, the Group and the Company become a party to the contractual provisions of the financial instrument. Financial
liabilities are classified as either financial liabilities at fair value through profit or loss or other financial liabilities.
(a)
60
2.
2.15
A financial liability is derecognised when the obligation under the liability is extinguished. When an existing financial
liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability
are substantially modified, such an exchange or modification is treated as a derecognition of the original liability and
the recognition of a new liability, and the difference in the respective carrying amounts is recognised in profit or loss.
2.16
Quoted (unadjusted) market prices in active markets for identical assets or liabilities;
Level 2 :
Valuation techniques for which the lowest level input that is significant to the fair value measurement
is directly or indirectly observable;
Level 3 :
Valuation techniques for which the lowest level input that is significant to the fair value measurement
is unobservable.
61
2.
2.16
2.17
Income taxes
i.
Current tax
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or
substantively enacted by the reporting date.
Current taxes are recognised in profit or loss except to the extent that the tax relates to items recognised
outside profit or loss, either in other comprehensive income or directly in equity.
ii.
Deferred tax
Deferred tax is provided using the liability method on temporary differences at the reporting date between the
tax bases of assets and liabilities and their carrying amounts for financial reporting purposes.
Deferred tax liabilities are recognised for all temporary differences, except:
-
where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability
in a transaction that is not a business combination and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss; and
62
2.
2.17
where the deferred tax asset relating to the deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time
of the transaction, affects neither the accounting profit nor taxable profit or loss; and
The carrying amount of deferred tax assets is reviewed at each reporting date and reduced to the extent
that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred
tax asset to be utilised. Unrecognised deferred tax assets are reassessed at each reporting date and are
recognised to the extent that it has become probable that future taxable profit will allow the deferred tax
assets to be utilised.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when
the asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or
substantively enacted at the reporting date.
Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred tax
items are recognised in correlation to the underlying transaction either in other comprehensive income or directly
in equity and deferred tax arising from a business combination is adjusted against goodwill on acquisition.
Deferred tax assets and deferred tax liabilities are offset, if a legally enforceable right exists to set off current
tax assets against current tax liabilities and the deferred taxes relate to the same taxable entity and the same
taxation authority.
2.18
2.19
Treasury shares
When shares of the Company, that have not been cancelled, recognised as equity are reacquired, the amount of
consideration paid is recognised directly in equity. Reacquired shares are classified as treasury shares and presented
as a deduction from total equity. No gain or loss is recognised in profit or loss on the purchase, sale, issue or
cancellation of treasury shares. When treasury shares are reissued by resale, the difference between the sales
consideration and the carrying amount is recognised in equity.
2.20
63
2.
2.21
Inventories
Inventories are stated at the lower of cost and net realisable value.
Cost of inventories of merchandise held for resale is determined using the weighted average method.
Cost of manufactured goods is determined using the first in, first out method. The cost of raw materials comprises
costs of purchase. The cost of finished goods and work-in-progress comprise costs of raw materials, direct labour,
other direct costs and appropriate proportions of manufacturing overheads based on normal operating capacity.
The cost of properties held for sale comprises cost associated with the acquisition of land, direct costs and appropriate
proportions of common costs. Cost is determined on a specific identification basis.
Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs necessary
to make the sale.
2.22
Leases
i.
As lessee
Finance leases, which transfer to the Group substantially all the risks and rewards incidental to ownership of
the leased item, are capitalised at the inception of the lease at the fair value of the leased asset or, if lower,
at the present value of the minimum lease payments. Any initial direct costs are also added to the amount
capitalised. Lease payments are apportioned between the finance charges and reduction of the lease liability
so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are
charged to profit or loss. Contingent rents, if any, are charged as expenses in the periods in which they are
incurred.
Leased assets are depreciated over the estimated useful life of the asset. However, if there is no reasonable
certainty that the Group will obtain ownership by the end of the lease term, the asset is depreciated over the
shorter of the estimated useful life and the lease term.
Operating lease payments are recognised as an expense in profit or loss on a straight-line basis over the
lease term. The aggregate benefit of incentives provided by the lessor is recognised as a reduction of rental
expense over the lease term on a straight-line basis.
ii.
As lessor
Leases where the Group and the Company retain substantially all the risks and rewards of ownership of the
asset are classified as operating leases. Initial direct costs incurred in negotiating an operating lease are
added to the carrying amount of the leased asset and recognised over the lease term on the same bases as
rental income. The accounting policy for rental income is set out in Note 2.27 (v).
2.23
Borrowings costs
Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly attributable to the acquisition,
construction or production of that asset. Capitalisation of borrowing costs commences when the activities to prepare
the asset for its intended use or sale are in progress and the expenditures and borrowing costs are incurred. Borrowing
costs are capitalised until the assets are substantially completed for their intended use or sale.
All other borrowing costs are recognised in profit or loss in the period they are incurred. Borrowing costs consist of
interest and other costs that the Group and the Company incurred in connection with the borrowing of funds.
2.24
Provisions
Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event,
it is probable that an outflow of economic resources will be required to settle the obligation and the amount of the
obligation can be estimated reliably.
Provisions are reviewed at each reporting date and adjusted to reflect the current best estimate. If it is no longer
probable that an outflow of economic resources will be required to settle the obligation, the provision is reversed. If
the effect of the time value of money is material, provisions are discounted using a current pre tax rate that reflects,
where appropriate, the risks specific to the liability. When discounting is used, the increase in the provision due to the
passage of time is recognised as a finance cost.
64
2.
2.25
Employee benefits
i.
ii.
2.26
Foreign currencies
i.
ii.
iii.
Foreign operations
The results and financial position of foreign operations that have a functional currency different from the
presentation currency of the consolidated financial statements are translated into RM as follows:
-
Assets and liabilities for each statement of financial position presented are translated at the closing
rate prevailing at the reporting date;
Income and expenses for each statement of comprehensive income are translated at average
exchange rates for the year, which approximate the exchange rates at the dates of the transactions;
and
All resulting exchange differences are taken to the foreign currency translation reserve within equity.
65
2.
2.26
2.27
Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the
revenue can be reliably measured. The following specific recognition criteria must also be met before revenue is
recognised:
i.
Sale of goods
Revenue is recognised net of sales taxes and upon transfer of significant risks and rewards of ownership
to the buyer. Revenue is not recognised to the extent where there are significant uncertainties regarding
recovery of the consideration due, associated costs or the possible return of goods.
ii.
iii.
Dividend income
Dividend income is recognised when the Group's right to receive payment is established.
iv.
Management fees
Management fees are recognised when services are rendered.
v.
Rental income
Rental income is recognised on a straight-line basis over the term of the lease. The aggregate cost of
incentives provided to lessees is recognised as a reduction of rental income over the lease term on a straightline basis.
vi.
Interest income
Interest income is recognised on an accrual basis using the effective interest method.
vii.
2.28
Government grant
Government grant is recognised at its fair value where there is reasonable assurance that the grant will be received
and all conditions attached will be met. Where the grant relates to an asset, the fair value is recognised as deferred
capital grant in the statements of financial position and is amortised to the statements of comprehensive income over
the expected useful life of the relevant asset by equal annual instalments.
Grant contributed towards the acquisition of plant and equipment is deducted from the cost of those assets.
66
2.
2.29
2.30
Segment reporting
For management purposes, the Group is organised into operating segments based on their products and services
which are independently managed by the respective segment managers responsible for the performance of the
respective segments under their charge. The segment managers report directly to the management of the Company
who regularly review the segment results in order to allocate resources to the segments and to assess the segment
performance. Additional disclosures on each of these segments are shown in Note 43, including the factors used to
identify the reportable segments and the measurement basis of segment information.
2.31
Contingencies
A contingent liability or asset is a possible obligation or asset that arises from past events and whose existence will
be confirmed only by the occurrence or non-occurrence of uncertain future event(s) not wholly within the control of
the Group and of the Company.
Contingent liabilities and assets are not recognised in the statements of financial position of the Group and of the
Company.
2.32
67
3.
3.1
Classification of property
The Group has developed certain criteria based on MFRS 140: Investment Property in making judgement
whether a property qualifies as an investment property. Investment property is a property held to earn rentals
or for capital appreciation or both.
The Company has leased out its building to a subsidiary as a supermarket and departmental store and
accordingly the building is classified as investment property in the Company's financial statements. The
building is classified as property, plant and equipment in the Group's financial statements as it is held for use
in the supply of goods and services.
Property that is held for sale in the ordinary course of business is classified as inventory property.
ii.
3.2
Impairment of goodwill
The Group determines whether goodwill are impaired at least on an annual basis. This requires an estimation
of the value-in-use of the cash-generating units ("CGU") to which goodwill are allocated. Estimating a valuein-use amount requires management to make an estimate of the expected future cash flows from the CGU
and also to choose a suitable discount rate in order to calculate the present value of those cash flows. The
carrying amount of the goodwill as at 31 May 2014 of the Group was RM4,665,045 (2013: RM4,665,045) is
disclosed in Note 21.
ii.
iii.
68
3.
3.2
v.
Deferred revenue
The Group allocates the consideration received from the sale of goods to the goods sold and the points
issued under its loyalty programme. The consideration allocated to the points issued is measured at their fair
value.
The carrying amount of deferred revenue allocated to the award credits at the reporting date was RM1,712,534
(2013: RM1,316,804) is disclosed in Note 37.
vi.
4.
Revenue
Sales of goods
Proceeds from the sale of inventory property
Sales of completed properties
Loan interest income
Rental income from:
- investment property
- operating leases, other than those relating to
investment property
Management fees from subsidiaries
Gross dividends from subsidiaries
Group
2014
RM
2013
RM
Company
2014
RM
2013
RM
368,698,511
3,590,160
354,100
5,600
367,859,428
249,000
5,360
1,656,684
1,656,684
5,516,647
378,165,018
4,220,762
372,334,550
60,000
4,830,636
6,547,320
240,000
11,838,536
13,735,220
69
5.
6.
7.
Directors' remuneration
Non-executive:
Other emoluments
Fees
Group
2013
RM
2014
RM
Company
2013
RM
407,785
50,000
-
310,684
50,000
50,000
42,114
6,808
835,610
1,401,886
2,744,203
7,466
20,839
595,610
857,040
1,891,639
84,409
7,833,179
7,917,588
71,191
260,160
331,351
Group
2014
RM
20,919,332
1,309,982
200,721
1,476,442
1,495,737
25,402,214
Group
2014
RM
2013
RM
18,609,646
1,341,395
197,498
1,435,162
1,384,607
22,968,308
2013
RM
Company
2014
RM
192,600
510
193,110
Company
2014
RM
2013
RM
192,600
192,600
2013
RM
395,706
177,600
52,500
32,070
657,876
379,564
177,600
45,000
30,180
632,344
18,000
174,600
192,600
18,000
174,600
192,600
50,000
74,000
124,000
50,000
74,000
124,000
50,000
65,000
115,000
50,000
65,000
115,000
70
7.
Group
2014
RM
2013
RM
Company
2014
RM
2013
RM
Directors of subsidiaries
Executive:
Salaries and other emoluments
Fees
Bonus
Contributions to defined contribution plan
482,206
9,000
93,684
67,216
652,106
580,022
9,000
47,952
72,077
709,051
150,000
150,000
1,583,982
22,952
1,615,395
28,294
307,600
-
307,600
-
1,606,934
1,643,689
307,600
307,600
1,309,982
1,341,395
192,600
192,600
274,000
1,583,982
22,952
274,000
1,615,395
28,294
115,000
307,600
-
115,000
307,600
-
1,606,934
1,643,689
307,600
307,600
Non-executive:
Fees
Analysis:
Total executive directors' remuneration (Note 6)
Total non-executive directors' remuneration
(Note 8)
Total directors' remuneration
Estimated money value of benefits-in-kind
Total directors remuneration including
benefits-in-kind
The executive directors remuneration of the Group amounting to RM1,309,982 (2013: RM1,341,395) are paid to the
present directors of the Group.
The number of directors of the Company whose total remuneration during the year fell within the following bands is
analysed below:
Executive directors:
RM50,001 - RM100,000
RM100,001 - RM150,000
RM300,001 - RM350,000
Non-executive directors:
Below RM50,000
Number of directors
2014
2013
2
1
2
1
71
8.
Auditors' remuneration:
- statutory audit
- current year
- underprovision in
prior years
- other services
Allowance for impairment of doubtful debts
(Note 24(b))
Bad debts written off
Foreign exchange (gains)/losses:
- realised
- unrealised
Non-executive directors' remuneration (Note 7)
- present directors
9.
Group
2014
RM
2013
RM
153,170
25,000
25,000
5,000
17,000
5,000
34,317
466,265
5,183,179
-
(975,401)
(172,744)
(172,422)
213,646
274,000
274,000
115,000
115,000
Finance costs
2013
RM
153,832
Group
2014
RM
Interest expense:
Bankers' acceptances
Bank overdrafts
Term loans
Unwinding of discount on non-current payable
10.
Company
2014
RM
2013
RM
100,007
285,203
476,163
311,301
1,172,674
Group
2014
RM
2013
RM
131,057
27,071
13,877
172,005
Company
2014
RM
2013
RM
4,651,694
(6,790,216)
(2,138,522)
6,666,641
(4,401)
6,662,240
1,517,567
(2,340)
1,515,227
1,669,630
(9,559)
1,660,071
(682,825)
(234,755)
(917,580)
(3,056,102)
(971,560)
(200,496)
(1,172,056)
5,490,184
1,515,227
1,660,071
Domestic income tax is calculated at the Malaysian statutory tax rate of 25% (2013: 25%) of the estimated assessable
profit for the year.
Taxation of other jurisdictions is calculated at the rates prevailing in the respective jurisdiction.
72
10.
2013
RM
14,844,611
19,186,944
3,711,153
1,773,006
(1,764,281)
(8,374)
257,365
(6,790,216)
(234,755)
(3,056,102)
4,796,736
(1,996)
1,351,529
(333,476)
(406,117)
288,405
(4,401)
(200,496)
5,490,184
13,616,837
7,696,178
3,404,209
164,881
(2,051,523)
(2,340)
1,515,227
1,924,045
1,503,126
(1,757,541)
(9,559)
1,660,071
Group
Company
Group
(i)
A subsidiary has on 18 January 2010 obtained approval from Malaysian Industrial Development Authority
("MIDA"), subject to certain conditions being complied with, 100% tax exemption on its statutory income on
"Fine Resolution Interconnect Flexible Printed Circuit Boards" (Pitch < 3mm) for a period of 5 years from
the "Production Date". The subsidiary has subsequently applied to MIDA to vary one of its conditions and
its application has been approved by MIDA. The subsidiary has in turn submitted an application to fix its
"Production Date" to the Ministry of International Trade and Industry ("MITI").
On 23 July 2013, MITI has approved the subsidiary's application and fixed 1 June 2009 as the "Production
Date" of the subsidiary where 100% of its statutory income on "Fine Resolution Interconnect Flexible Printed
Circuit Boards" (Pitch < 3mm) is tax exempted for a period of 5 years from 1 June 2009 to 31 May 2014.
During the current year, the subsidiary has re-submitted the revised corporate tax return to the tax authority
for year of assessments 2010, 2011, 2012 and 2013. Accordingly, the tax paid in prior years in respect of
these years of assessment amounting to approximately RM6,800,000 have been reversed as overprovision
in prior year and recorded as tax recoverable as at 31 May 2014.
73
11.
12.
17,763,907
57,319,148
30.99
30.99
2013
RM
13,890,365
57,334,148
24.23
24.23
Dividend
Amount
2014
RM
2013
RM
3,441,189
6.00
3,439,329
3.44
3,439,329
3,441,189
3.44
6.00
At the forthcoming Annual General Meeting, a first and final single tier dividend of 6% in respect of the current financial
year ended 31 May 2014, on 57,314,448 ordinary shares (the number of outstanding ordinary shares in issue of the
Company as at 31 May 2014 after the set off with 3,685,800 ordinary shares bought back by the Company and held
as treasury shares subsequent to year end) amounting to RM3,438,867 (6 sen net per share) will be proposed for
shareholders' approval. The financial statements for the current financial year do not reflect this proposed dividend.
Such dividends when approved by the shareholders will be accounted for in equity as an appropriation of retained
earnings in the financial year ending 31 May 2015.
13.
Accumulated depreciation
At 1 June 2013
Depreciation charge for
the year
Reclassifications
Disposals
Write off
At 31 May 2014
Cost
At 1 June 2013
Additions
Reclassifications
Disposals
Write off
At 31 May 2014
2014
Group
5,523,768
13,212
28,492
63,848
999,835
2,313,308
15,280
1,030,570
4,521,690
5,552,260
Long-term
leasehold
apartment
RM
935,987
3,313,143
3,313,143
Short-term
leasehold
land
RM
69,515,100
3,469,393
76,954
23,699,595
20,153,248
59,368,975
155,038
33,690,682
93,214,695
Buildings
RM
17,380,074
5,008,001
(17,172)
(1,326,794)
(5,360,023)
47,917,637
49,613,625
63,104,649
1,215,268
7,986,191
(1,601,407)
(5,406,990)
65,297,711
Plant and
machinery
RM
3,421,862
1,519,639
(59,782)
(3,135,833)
14,594,224
16,270,200
19,477,253
1,552,037
122,628
(3,135,832)
18,016,086
Office
equipment,
renovation,
furniture
and fittings
RM
469,141
212,545
(6,369)
5,150,717
4,944,541
5,237,725
198,413
190,090
(6,370)
5,619,858
Computers
RM
751,434
209,538
2,380,023
2,170,485
3,131,457
3,131,457
Motor
vehicles
RM
32,288,041
1,096,591
1,096,591
56,267,943
23,627,970
(46,511,281)
33,384,632
Capital
work-inprogress
RM
131,662,728
10,496,176
(1,326,794)
(8,502,225)
95,867,114
95,199,957
210,931,715
26,748,726
(1,601,407)
(8,549,192)
227,529,842
Total
RM
74
ANNUAL REPORT 2014
13.
Accumulated depreciation
At 1 June 2012
Depreciation charge for
the year
Write off
Exchange differences
At 31 May 2013
Cost
At 1 June 2012
Additions
Reclassifications
Disposals
Write off
Exchange differences
At 31 May 2013
2013
Group
1,015,290
13,099
15,280
63,856
935,987
2,377,156
2,181
1,030,570
1,030,570
Long-term
leasehold
apartment
RM
872,131
3,313,143
3,313,143
Short-term
leasehold
land
RM
39,215,727
3,099,272
20,153,248
17,053,976
59,316,986
51,989
59,368,975
Buildings
RM
13,491,024
4,018,346
(14,479,498)
49,613,625
60,074,777
76,591,190
495,258
633,096
(14,614,895)
63,104,649
Plant and
machinery
RM
3,207,053
2,182,324
(1,303,127)
643
16,270,200
15,390,360
20,445,993
283,954
65,000
(1,318,435)
741
19,477,253
Office
equipment,
renovation,
furniture
and fittings
RM
293,184
271,413
(40,303)
4,944,541
4,713,431
5,283,425
29,650
(75,350)
5,237,725
Computers
RM
960,972
203,617
(130,555)
2,170,485
2,097,423
2,948,318
313,695
(130,556)
3,131,457
Motor
vehicles
RM
55,171,352
1,096,591
1,096,591
29,297,337
27,687,702
(698,096)
(19,000)
56,267,943
Capital
work-inprogress
RM
115,731,758
9,851,927
(15,953,483)
643
95,199,957
101,300,870
198,226,962
28,862,248
(19,000)
(16,139,236)
741
210,931,715
Total
RM
75
76
13.
Plant and
machinery
RM
Office
equipment,
renovation,
furniture
and fittings
RM
Computers
RM
Motor
vehicles
RM
Total
RM
Cost
At 1 June 2013/At 31 May 2014
1,443,263
18,292
26,003
535,017
2,022,575
Accumulated depreciation
At 1 June 2013
Depreciation charge for the year
At 31 May 2014
1,441,171
342
1,441,513
18,291
18,291
23,990
630
24,620
535,016
535,016
2,018,468
972
2,019,440
1,750
1,383
3,135
Cost
At 1 June 2012/At 31 May 2013
1,443,263
18,292
26,003
535,017
2,022,575
Accumulated depreciation
At 1 June 2012
Depreciation charge for the year
At 31 May 2013
1,440,695
476
1,441,171
18,291
18,291
23,360
630
23,990
535,016
535,016
2,017,362
1,106
2,018,468
2,092
2,013
4,107
Company
2014
a motor vehicle of the Company with net carrying amount of RM1 (2013: RM1) which is registered
under the name of an employee of the subsidiary in trust for the Company;
(ii)
motor vehicles of a subsidiary with net carrying amount of RM47,173 (2013: RM65,309) which are
registered under the name of a director of the Company, i.e. Dato' Hwang Thean Long in trust for
the said subsidiary;
(iii)
leasehold land of a subsidiary included under capital work-in-progress with a net carrying amount
of RM16,273,409 (2013: RM16,273,409) pledged to a bank to secure bank borrowings as disclosed
in Note 33; and
(iv)
land and building of a subsidiary with a net carrying amount of RM4,521,690 and RM33,123,704
respectively, pledged to a bank to secure bank borrowings as disclosed in Note 33; and
(v)
fully depreciated property, plant and equipment which are still in use with the following costs:
Group
2014
RM
Buildings
Plant and machinery
Office equipment, renovation,
furniture and fittings
Computers
Motor vehicles
2013
RM
Company
2014
RM
2013
RM
938,648
24,241,679
938,648
23,828,544
1,440,273
1,438,512
5,922,352
4,566,212
1,470,050
37,138,941
8,942,112
4,037,880
1,426,417
39,173,601
18,290
21,803
535,017
2,015,383
18,290
21,803
535,017
2,013,622
77
13.
14.
The short term leasehold land has an unexpired lease of 35 years (2013: 36 years).
(c)
The long term leasehold land included under capital work-in-progress has an unexpired lease of 90 years
(2013: 91 years).
(d)
The long term leasehold apartment has an unexpired lease of 76 years (2013: 77 years).
(e)
Included in the buildings of the Group are buildings erected on land leased from statutory bodies with a net
carrying amount of RM2,160,285 (2013: RM4,208,483).
Investment property
Company
2014
RM
2013
RM
29,078,033
29,078,033
5,104,571
473,171
5,577,742
4,631,400
473,171
5,104,571
23,500,291
23,973,462
Company
The investment property of the Company has an open market value of approximately RM25,800,000 (2013:
RM25,800,000) and is leased to a subsidiary as a supermarket and departmental store.
The title deed of the investment property is registered under the name of a corporate shareholder of the Company,
i.e. Suiwah Holdings Sdn. Bhd., a company in which a director of the Company, i.e. Dato' Hwang Thean Long has a
substantial interest. The strata title of the building is in the process of being transferred to the Company.
Direct operating expenses incurred by the Company on the investment property during the financial year amounted
to RM652,357 (2013: RM652,355).
15.
Group
2014
RM
256,409
(215,266)
41,143
2013
RM
471,675
(215,266)
256,409
78
16.
Intangible asset
Group
2014
RM
Patent license
Cost:
At 1 June 2013 / 2012
Additions
At 31 May 2014 / 2013
Accumulated amortisation:
At 1 June 2013 / 2012
Amortisation during the year
At 31 May 2014 / 2013
Net carrying amount:
At 31 May 2014 / 2013
17.
2013
RM
6,905,900
6,905,900
6,905,900
6,905,900
374,070
374,070
6,531,830
6,905,900
Investments in subsidiaries
Company
2014
RM
69,260,773
(962,154)
68,298,619
2013
RM
60,560,774
(1,304,430)
59,256,344
Impairment assessment
As at 31 May 2014, the Company carried out a review of the recoverable amount of its investments in subsidiaries. A
reversal of impairment loss of RM342,276 has been recognised in profit or loss, increasing the net carrying amount of
the investment in Great Support Sdn. Bhd. to its recoverable amount as at 31 May 2014.
(a)
Name of subsidiaries
% of ownership interest
held by the Group
2014
2013
Principal activities
Incorporated in Malaysia
Sunshine Wholesale Mart Sdn. Bhd.
100
100
100
100
100
100
Investment holding
100
100
100
100
Property investment
100
100
Supply of electricity
79
17.
Name of subsidiaries
% of ownership interest
held by the Group
2014
2013
Principal activities
75
75
Property development
100
100
Property development
100
100
Property development
100
100
100
100
Dormant
100
100
Investment holding
51
51
100
100
100
100
100
100
100
100
100
100
100
100
Incorporated in Indonesia
PT. Sunshine Amanjaya Indonesia (ii)
Incorporated in India
Qdos Flexcircuits (India)
Private Limited (i)
(i)
(ii)
The Company has a 99% equity interest in the subsidiary and the remaining 1% equity interest is held by a
wholly owned subsidiary, Sunshine Amanjaya Sdn. Bhd.
(iii)
The Company has a 50% equity interest in the subsidiary and the remaining 1% equity interest is held by a
wholly owned subsidiary, Sunshine Wholesale Mart Sdn. Bhd.
80
17.
Summarised financial information of Great Support Sdn. Bhd. which has non-controlling interests that is
material to the Group is set out below. The summarised financial information presented below is the amount
before inter-company elimination. The non-controlling interests in respect of Sunshine Amanjaya Pte Ltd is
not material to the Group.
(i)
(ii)
2013
RM
Non-current assets
Current assets
Total assets
3,180,511
3,180,511
2,834,809
2,834,809
68,907
3,111,604
21,790
2,813,019
2,333,703
777,901
2,109,764
703,255
2014
RM
2013
RM
3,590,160
568,585
130,895
426,439
142,146
98,171
32,724
68,204
2014
RM
2013
RM
Revenue
Profit for the year, representing total
comprehensive income for the year
Profit for the year, representing total
comprehensive income for the year
attributable to:
- owners of the Company
- non controlling interests
Dividend paid to non controlling interests
(iii)
3,422,452
35,732
(277,673)
3,180,511
3,180,511
(3,893)
3,893
-
81
18.
15,063,373
12,344
(3,007,346)
12,068,371
2013
RM
15,063,373
(45,424)
(2,949,372)
12,068,577
During the year ended 31 May 2011, the Groups subsidiaries, Qdos Flexicircuits Sdn. Bhd. and Qdos Flexicircuit
(India) Private Limited have entered into a Shareholders' Agreement with M.J Shantharam, Valdel Real Estate Pvt. Ltd
and Exora Technologies Private Limited (Exora) to subscribe up to 22,500,000 new shares of Rupees 10 each in
Exora, representing 49% of the equity interest in Exora, for a total cash consideration of approximately RM15 million.
As at 31 May 2014, the Groups subsidiaries have in total subscribed for 22,151,893 shares of Rupees 10 each in
Exora, representing 49% of the equity interest in Exora for a total cash consideration of RM15,063,373.
The Group has 49% of the voting rights of its joint arrangement. Under the contractual arrangement, unanimous
consent is required from all parties to the agreement for all relevant activities.
The joint arrangement is structured via separate entity and provides the Group with the rights to the net assets of the
entity under the arrangement. Therefore, this entity is classified as a joint venture of the Group.
(a)
% of ownership
interest held
by the Group
2014
2013
Nature of relationship
Accounting
model
applied
49
49
Equity
method
82
18.
Summarised financial information of Exora is set out as below. The summarised information represents the
amounts in the MFRS financial statements of the joint venture and not the Group's share of those amounts.
(i)
2013
RM
2,720
2,733
Total assets
1,633,608
2,606,241
24,450,644
7,336,664
36,027,157
36,029,877
227,361
18,282,273
7,360,785
25,870,419
25,873,152
Current liabilities
Short term borrowings
Trade payables
Other current liabilities
Total liabilities
Net assets
11,479,870
245
32,933
11,513,048
24,516,829
1,357,051
246
55
1,357,352
24,515,800
2014
RM
2013
RM
Assets
Non-current assets
Current
Trade receivables
Cash and cash equivalents
Short term loans and advances
Other current assets
(ii)
Other income
Administration expenses
Finance cost
Other expenses
Profit before tax
Tax expense
Profit after tax, representing total comprehensive income
(c)
179,908
(11,062)
(24)
(205)
168,617
(50,723)
117,894
(8,952)
(6)
(484)
(9,442)
(9,442)
Reconciliation of the summarised financial information presented above to the carrying amount of the Groups
interest in joint venture:
2014
RM
Net assets at 1 June 2013 / 2012
Profit/(Loss) for the year
Exchange difference
Net assets at 31 May 2014 / 2013
Interest in joint venture
Goodwill
Carrying value of Groups interest in joint ventures
24,515,800
117,894
(116,865)
24,516,829
49%
55,125
12,068,371
2013
RM
25,304,670
(9,442)
(779,428)
24,515,800
49%
55,835
12,068,577
83
19.
Investment in an associate
Group
2014
RM
1,631,726
1,631,726
(1,513,625)
(118,101)
-
Company
2014
RM
2013
RM
1,631,726
1,631,726
(1,513,625)
(118,101)
-
1,631,726
(1,631,726)
-
2013
RM
1,631,726
(1,631,726)
-
Impairment assessment
The Company has carried out a review of the recoverable amount of its investment in associate due to its net liability
position. The review has led to the retention of the impairment loss of RM1,631,726 recognised in profit or loss in the
prior year, reducing the net carrying amount of the investment to nil.
(a)
Name of associate
% of ownership
interest held
by the Group
2014
2013
Accounting
model
applied
Nature of relationship
Incorporated in India
Valdel Oil and Gas Private
Limited ("VOG")
(b)
25
25
Carrying on business
connected with oil and
natural gas. The Company
has remained dormant
during the year.
Equity
method
Summarised financial information of VOG is set out below. The summarised financial information represents
the amounts in the MFRS financial statements of the associate and not the Groups share of those amounts.
(i)
Non-current assets
Current assets
Total assets
Non-current liabilities
Current liabilities
Total liabilities
Net liabilities
(ii)
2014
RM
2013
RM
5,211,741
306,391
5,518,132
5,382,920
403,300
5,786,220
9,874
6,698,193
6,708,067
(1,189,935)
9,874
6,615,544
6,625,418
(839,198)
2013
RM
550,009
(304,216)
428,611
(338,353)
(304,216)
547,716
84
20.
Investment securities
Non-current
Available-for-sale financial assets
- Equity instruments (quoted in Malaysia)
-Equity instruments (quoted outside Malaysia)
Market value
21.
Goodwill on consolidation
At 31 May
Group
2014
RM
2013
RM
2,841
273
3,114
2,841
273
3,114
6,216
3,888
Group
2014
RM
2013
RM
4,665,045
4,665,045
Allocation of goodwill
Goodwill has been allocated to the Group's cash-generating units ("CGU") identified according to the business
segment and relates to the manufacturing and designing of flexible printed circuits boards as follows:
Manufacturing
(b)
2014
RM
2013
RM
4,665,045
4,665,045
(ii)
Growth rate
The weighted average growth rate used is consistent with the long term average growth rate for the
relevant industry. The forecasted growth rate used to extrapolate cash flows beyond the five-year
period is 3.6% (2013: 3.9%).
(iii)
Discount rate
The discount rate used is on a basis that reflects specific risks relating to the relevant business
segment. The pre-tax discount rate applied to the cash flow projections is 9.6% (2013: 10%)
85
21.
22.
Inventory property
Group
2014
At 1 June 2013
Costs incurred during the year
Disposals
At 31 May 2014
Freehold
land
RM
Leasehold
land
RM
Development
costs
RM
7,305,719
(2,834,809)
4,470,910
12,417,091
12,417,091
6,443,670
194,043
6,637,713
26,166,480
194,043
(2,834,809)
23,525,714
7,305,719
7,305,719
12,417,091
12,417,091
6,245,547
198,123
6,443,670
25,968,357
198,123
26,166,480
Total
RM
2013
At 1 June 2012
Costs incurred during the year
At 31 May 2013
Included in freehold land is a Malay reserve freehold land with a carrying value of RM Nil (2013: RM2,834,809).
The long term leasehold land is pledged to a bank to secure bank borrowings as disclosed in Note 33 and has an
unexpired lease of 90 years (2013: 91 years).
23.
Inventories
At cost:
Merchandise held for resale
Raw materials
Work-in-progress
Finished goods
Properties held for sale
Spare parts
Group
2014
RM
2013
RM
21,047,243
4,630,669
2,664,016
617,256
4,328,413
448,444
33,736,041
20,619,755
4,518,819
2,206,200
436,670
4,569,693
368,802
32,719,939
33,736,041
791,272
33,511,211
The cost of inventories recognised as an expense during the year amounted to RM289,597,882 (2013: RM286,958,287).
The reversal of write-down of inventories amounting to RM157,494 (2013: RM Nil) was made during the year when
the related inventories were sold above their carrying amounts.
86
24.
Trade receivables
Third parties
Allowance for impairment
Trade receivables, net
Group
2014
RM
2013
RM
Company
2014
RM
2013
RM
17,756,403
17,756,403
22,306,783
22,306,783
1,378,260
179,176
-
1,838,260
8,733,639
586
5,730,989
27,693,517
3,773
4,721
5,436,370
24,382,812
1,314
32,834
759,273
1,933,869
56,664
1,085,366
3,835,172
3,835,172
21,591,575
84,236
27,844,565
49,520,376
864,803
594,019
24,750
415,559
1,899,131
1,899,131
24,205,914
28,730
32,199,611
56,434,255
1,000
34,991,436
34,991,436
34,991,436
3,213,822
38,205,258
1,000
3,680,000
44,106,815
(7,833,179)
36,273,636
36,273,636
4,008,160
40,281,796
Other receivables
Due from subsidiaries:
- Magirex Sdn. Bhd.
- Sunshine Amanjaya Sdn. Bhd.
- PT. Sunshine Amanjaya Indonesia
- Sunshine Supermarket & Departmental Store
Sdn. Bhd.
- Sunshine Wholesale Mart Sdn. Bhd.
- Sunshine (Labuan) Private Limited
- Sunshine Amanjaya Pte. Ltd.
Deposits for:
- Rental
- Others
Rental income receivable
Sundry receivables
Dividend receivable from Qdos Holdings Bhd.
Allowance for impairment
Other receivables, net
Total trade and other receivables
Add: Loan receivables (Note 26)
Add: Cash and bank balances (Note 28)
Total loans and receivables
(a)
Trade receivables
The Group's primary exposure to credit risk arises through the trade receivables of its manufacturing
subsidiaries. The Group's trading terms with its customers are mainly on credit, except for new customers,
where payment in advance is normally required. The normal credit periods range from 30 to 75 days (2013:
30 to 75 days). Other credit terms are assessed and approved on a case-by-case basis. The Group seeks to
maintain strict control over its outstanding receivables and has a credit control department to minimise credit
risk. Overdue balances are reviewed regularly by senior management.
At 31 May 2014, the Group has significant exposure to a group of customers, which constitutes approximately
45% (2013: 74%) of the trade receivables as at year end.
87
24.
2014
RM
2013
RM
9,664,823
9,708,475
3,790,705
2,025,912
711,837
428,679
1,134,447
8,091,580
17,756,403
5,066,389
3,416,217
2,889,262
39,030
1,187,410
12,598,308
22,306,783
Trade receivables:
- nominal amounts
Allowance for impairment
Group
2014
RM
-
2013
RM
-
2013
RM
157,729
(157,729)
-
88
24.
34,991,436
34,991,436
2013
RM
44,106,815
(7,833,179)
36,273,636
7,833,179
(7,833,179)
-
2013
RM
2,910,160
5,183,179
(260,160)
7,833,179
25.
Prepayments
26.
Loan receivables
Group
2014
RM
505,849
2013
RM
398,315
Company
2014
RM
14,932
Group
2014
RM
78,466
5,770
84,236
2013
RM
14,932
2013
RM
26,000
2,730
28,730
The advances are made by a subsidiary, Sunshine Wholesale Mart Sdn. Bhd. whose principal activities include that
of money lending under the Moneylenders Act 1951. The advances bear interest rates of 12% to 18% (2013: 12% to
18%) per annum.
89
27.
Group
2014
RM
2013
RM
17,036,600
7,272,496
24,309,096
9,509,662
4,189,173
13,698,835
17,036,600
9,509,662
Other information on financial risks of short term investments is disclosed in Note 41.
28.
Group
2014
RM
Company
2014
RM
2013
RM
2013
RM
23,892,895
31,367,611
3,213,822
4,008,160
2,400,000
1,551,670
27,844,565
832,000
32,199,611
3,213,822
4,008,160
Included in cash at banks of the Group are amounts of RM2,331,480 (2013: RM2,285,371) held pursuant to Section
7A of the Housing Development (Control and Licensing) Act 1966 and are restricted from use in other operations.
Deposits with licensed banks of the Group amounting to RM430,808 (2013: RM420,070) have been pledged to banks
as collaterals for bank facilities and bankers' guarantees obtained.
Deposits with licensed banks of the Group amounting to RM207,962 (2013: RM136,755) are held in trust by a director.
The range of interest rates earned per annum and the maturities period during the financial year for short term
placements and fixed deposits were as follows:
2014
Interest rates
Maturity period
2013
Other information on financial risks of cash and cash equivalents is disclosed in Note 41.
For the purposes of the statements of cash flows, cash and cash equivalents comprise the following as at the reporting
date:
Group
2014
RM
Deposits with licensed banks
Less: Fixed deposits pledged to banks
Fixed deposits (more than 90 days)
Add: Cash on hand and at banks
Less: Bank overdraft (Note 33)
Cash and cash equivalents
3,951,670
(430,808)
(412,863)
3,107,999
23,892,895
27,000,894
2013
RM
832,000
(420,070)
(411,930)
31,367,611
(9,142,089)
22,225,522
Company
2014
RM
3,213,822
3,213,822
2013
RM
4,008,160
4,008,160
90
29.
Share
capital
(issued and
fully paid)
RM
Amount
Treasury
shares
RM
Share
premium
RM
At 1 June 2012
Purchase of treasury shares
At 31 May 2013
61,000,248
61,000,248
(3,646,100)
(20,000)
(3,666,100)
61,000,248
61,000,248
(5,316,898)
(29,820)
(5,346,718)
13,934,711
13,934,711
At 1 June 2013
Purchase of treasury shares
At 31 May 2014
61,000,248
61,000,248
(3,666,100)
(15,000)
(3,681,100)
61,000,248
61,000,248
(5,346,718)
(27,663)
(5,374,381)
13,934,711
13,934,711
Authorised:
At 1 June and 31 May
Number of ordinary
shares of RM1 each
2014
2013
100,000,000
100,000,000
Amount
2014
RM
100,000,000
2013
RM
100,000,000
There is no movement in issued and fully paid/ authorised share capital during the year.
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one
vote per share at meetings of the Company. All ordinary shares rank equally with regard to the Company's residual
assets.
(a)
Treasury shares
The shareholders of the Company, by an ordinary resolution passed in a general meeting held on 28 November
2013, renewed their approval for the Company's plan to buy back its own ordinary shares. The directors of
the Company are committed to enhancing the value of the Company for its shareholders and believe that the
share buy back plan can be applied in the best interests of the Company and its shareholders.
During the financial year, the Company bought back 15,000 (2013: 20,000) of its issued and fully paid
ordinary shares from the open market at an average price of RM1.84 (2013: RM1.49) per share. The total
consideration paid for the share buy back was RM27,663 (2013: RM29,820), consisting of consideration
paid amounting to RM27,510 (2013: RM29,650) and transaction costs of RM153 (2013: RM170). The shares
bought back are being held as treasury shares in accordance with Section 67A of the Companies Act 1965.
Of the total 61,000,248 (2013: 61,000,248) issued and fully paid ordinary shares as at 31 May 2013,
3,681,100 (2013: 3,666,100) are held as treasury shares by the Company. As at 31 May 2014, the number
of outstanding ordinary shares in issue after the set off is therefore 57,319,148 (2013: 57,334,148) ordinary
shares of RM1 each.
Subsequent to year end, the Company bought back 4,700 of its issued ordinary shares from the open market
at an average price of RM2.90 per share. The total consideration paid for the share buy back was RM13,705,
consisting of consideration paid amounting to RM13,630 and transaction costs of RM75. The share buy back
transactions were financed by internally generated funds.
91
30.
Group
At 1 June 2013 / 2012
Foreign currency translation
At 31 May 2014 / 2013
Foreign currency
translation reserve
2014
2013
RM
RM
(2,875,026)
(37,344)
(2,912,370)
(2,431,366)
(443,660)
(2,875,026)
Group
Other reserve of the Group represents foreign currency translation reserve. The foreign currency translation reserve
is used to record exchange differences arising from the translation of the financial statements of foreign operations
whose functional currencies are different from that of the Group's presentation currency. It is also used to record the
exchange differences arising from monetary items which form part of the Group's net investment in foreign operations,
where the monetary item is denominated in either the functional currency of the reporting entity or the foreign operation.
31.
Retained earnings
Prior to the year of assessment 2008, Malaysian companies adopted the full imputation system. In accordance with
the Finance Act 2007 which was gazetted on 28 December 2007, companies shall not be entitled to deduct tax on
dividend paid, credited or distributed to its shareholders, and such dividends will be exempted from tax in the hands of
the shareholders ("single tier system"). However, there is a transitional period of six years, expiring on 31 December
2013, to allow companies to pay franked dividends to their shareholders under limited circumstances. Companies
also have an irrevocable option to disregard the revised 108 balance and pay dividends under the single tier system.
The change in the tax legislation also provides for the 108 balance to be locked-in as at 31 December 2007 in
accordance with Section 39 of the Finance Act 2007.
The Company did not elect for the irrevocable option to disregard the 108 balance. Accordingly, during the transitional
period, the Company may utilise the credit in the 108 balance to distribute cash dividend payments to ordinary
shareholders as defined under the Finance Act 2007. As at 31 May 2013, the Company has sufficient tax credit in
the revised 108 balance to pay franked dividends amounting to RM20,043,024 out of its retained earnings. Any 108
balance which has not been utilised as at 31 December 2013 is disregarded. Thereafter, the Company may distribute
dividends out of its entire retained earnings under the single tier system.
As at 31 May 2014, the Company has tax exempt profits available for distribution of approximately RM226,897 (2013:
RM226,897), subject to the agreement of the Inland Revenue Board.
32.
Government grant
Group
2014
RM
2013
RM
Cost:
At 1 June 2013 / 31 May 2014
400,000
400,000
Accumulated amortisation:
At 1 June 2013 / 2012
Amortisation during the year (Note 5)
At 31 May 2014/ 2013
185,417
50,000
235,417
135,417
50,000
185,417
50,000
114,583
164,583
50,000
164,583
214,583
Government grant relates to grant received for the acquisition of plant and equipment for development activities
undertaken by a subsidiary of the Group to promote technology advancement. There are no unfulfilled conditions or
contingencies attached to the grant.
92
33.
Borrowings
Group
2014
RM
2013
RM
4,921,016
1,738,148
6,659,164
9,142,089
3,337,249
931,872
13,411,210
11,370,090
1,480,354
4,921,016
13,108,238
18,029,254
9,142,089
3,337,249
2,412,226
14,891,564
6,659,164
2,154,922
2,809,779
6,405,389
18,029,254
13,411,210
1,480,354
14,891,564
(ii)
a first legal charge over the leasehold land of a subsidiary included under capital work-in-progress and
inventory property with a carrying amount of RM16,273,409 (2013: RM16,273,409) and RM12,417,091
(2013: RM12,417,091) respectively as disclosed in Note 13 and Note 22.
(iii)
a first party first fixed charge over a piece of land and building of a subsidiary with a carrying amount of
RM4,521,690 and RM33,123,704 respectively as disclosed in Note 13.
Bank overdrafts are denominated in RM and bear interest rate at Nil (2013: 7.5%) per annum.
The bankers' acceptances bore interest rates at the reporting date ranging from 3.73% to 3.92% (2013: 3.70% to
3.75%) per annum.
The term loans of the Group are repayable over:
(i)
seventy eight (78) equal monthly instalments of RM87,217 commencing 1 September 2009. The term
loan bore interest rates at the reporting date ranging from 4.5% to 6.6% (2013: 4.5% to 6.3%) per annum.
Subsequent to year end, the Group has fully settled the term loan. Further details are disclosed in Note 44.
(ii)
hundred and fourty three (143) equal monthly instalments of RM111,590 commencing 4 January 2014. The
last instalment may vary to ensure full settlement of the term loan.The term loan bore a profit rate of 5.1%
(2013: Nil) per annum at the reporting date.
93
34.
Deferred tax
Group
2014
RM
2013
RM
2,621,026
(917,580)
1,703,446
3,793,082
(1,172,056)
2,621,026
1,703,446
1,703,446
2,621,026
2,621,026
The components and movements of deferred tax liabilities and assets during the financial year prior to offsetting are
as follows:
Deferred tax liabilities of the Group
Property,
plant and
equipment
RM
Revaluation
surplus *
RM
Others
RM
Total
RM
At 1 June 2013
Recognised in profit or loss
At 31 May 2014
2,181,650
(758,270)
1,423,380
1,090,752
(29,604)
1,061,148
102,873
3,954
106,827
3,375,275
(783,920)
2,591,355
At 1 June 2012
Recognised in profit or loss
At 31 May 2013
2,925,345
(743,695)
2,181,650
1,133,021
(42,269)
1,090,752
295,852
(192,979)
102,873
4,354,218
(978,943)
3,375,275
Others
RM
Total
RM
At 1 June 2013
Recognised in profit or loss
At 31 May 2014
(489,374)
(54,155)
(543,529)
(264,875)
(79,505)
(344,380)
(754,249)
(133,660)
(887,909)
At 1 June 2012
Recognised in profit or loss
At 31 May 2013
(450,679)
(38,695)
(489,374)
(110,457)
(154,418)
(264,875)
(561,136)
(193,113)
(754,249)
Revaluation surplus relates to revaluation of property, plant and equipment in prior years. Upon transition to
MFRS, the Group elected to measure all its property, plant and equipment using cost model. Accordingly, the
revaluation surplus was transferred to retained earnings on date of transition to MFRS.
Deferred tax assets have not been recognised in respect of the following items:
Group
2014
RM
Unused tax losses
Unabsorbed capital allowances
Other deductible temporary differences
5,743,510
2,095,138
23,838
7,862,486
2013
RM
5,757,824
1,240,073
23,954
7,021,851
94
34.
35.
Group
2014
RM
2013
RM
256,517
256,517
270,285
(13,768)
256,517
This represents provision for liquidated damages in respect of the development projects undertaken by a subsidiary.
The provision is recognised for expected liquidated damages claims based on the terms of the applicable sale and
purchase agreements.
36.
Current
Trade payables
Third parties
Related party *
Other payables
Due to subsidiaries:
- Crimson Omega Sdn. Bhd.
- Aljano Sdn. Bhd.
- Silver Resort Sdn. Bhd.
- PT Sunshine Amanjaya Indonesia
Due to tooling suppliers
Deposits received
Rental deposits
Accruals
Other payables
Non-current
Other payable
Total trade and other payables
Add: Borrowings (Note 33)
Total financial liabilities
carried at amortised cost
*
Group
2014
RM
2013
RM
Company
2014
RM
2013
RM
49,015,481
30,443
49,045,924
46,465,134
37,399
46,502,533
112,109
4,500
1,540,379
4,141,005
6,353,082
12,151,075
61,196,999
110,912
5,500
998,944
4,523,333
4,327,405
9,966,094
56,468,627
20,099,627
1,189,349
58,427
144,006
285,105
61,650
21,838,164
21,838,164
22,840,749
627,407
39,021
269,101
61,650
23,837,928
23,837,928
6,299,262
6,064,296
67,496,261
18,029,254
62,532,923
14,891,564
21,838,164
-
23,837,928
-
85,525,515
77,424,487
21,838,164
23,837,928
The related party is Zephyr (Penang) Sdn. Bhd., a company in which a director of a subsidiary, Qdos Holdings
Bhd., i.e. Looi Tik Miow, has an interest.
95
36.
Trade payables
Trade payables are non-interest bearing and the normal trade credit terms granted to the Group range from
30 to 90 days (2013: 30 to 90 days).
(b)
Other payables
Included in current and non-current payables of the Group is RM503,941 (2013: RM224,604) and RM6,299,262
(2013: RM6,064,296) respectively for the acquisition of intangible assets. The amount is payable by way
of instalments in the aggregate sum of USD3,000,000 either upon the achievement of certain cumulative
targeted sales quantity or by instalments ranging between USD200,000 to USD400,000 over a period of 10
years by 31 December 2022, whichever is earlier. The gross payable is recognised based on the net present
value discounted at a rate of 4.95% per annum.
(c)
37.
Deferred revenue
The Group operates a loyalty programme which allows customers to accumulate points when they purchase products
in the Groups stores. The points can be redeemed for free or for discounted goods from the Groups stores.
Deferred revenue represents consideration received from the sale of goods that is allocated to the points issued under
the loyalty programme that are expected to be redeemed but are still outstanding as at the reporting date.
At 31 May 2014, the estimated liability for unredeemed points amounted to RM1,712,534 (2013: RM1,316,804):
Group
2014
RM
At 1 June 2013 / 2012
Recognised in profit or loss (net)
At 31 May 2014 / 2013
1,316,804
395,730
1,712,534
2013
RM
1,277,852
38,952
1,316,804
96
38.
Commitments
(a)
Capital commitments
Group
2014
RM
Capital expenditure:
Approved and contracted for:
- Land and building
- Machineries
(b)
10,997,000
528,000
2013
RM
11,656,000
-
(c)
3,622,977
4,110,413
288,408
8,021,798
2013
RM
3,434,700
1,126,178
802,011
5,362,890
2,182,235
1,930,227
1,656,684
1,656,684
468,365
2,650,600
129,500
2,059,727
1,656,684
1,656,684
97
39.
Group
Rental paid/payable to:
- Suiwah Holdings Sdn. Bhd., a corporate shareholder
- Suiwah Supermarket Sdn. Bhd., a company in which
a director of the Company, i.e. Dato Hwang Thean
Long has an interest
- a director of the Company, i.e. Dato Hwang Thean
Long
- Meridian Chance Sdn. Bhd., a company connected
with a director of the Company, i.e. Dato Hwang
Thean Long by virtue of his family relationship
Purchases of merchandise from Zephyr (Penang)
Sdn. Bhd., a company in which Looi Tik Miow, a director
of a subsidiary, Qdos Holdings Bhd., has an interest
2014
RM
2013
RM
2,284,806
2,284,806
21,164
11,800
48,000
48,000
24,000
24,000
269,810
155,947
4,830,636
60,000
1,656,684
8,700,000
11,838,536
240,000
1,656,684
-
500,000
(2,500,000)
2,706,657
460,000
(350,000)
2,459
28,113
(144,592)
6,331,960
(21,133,742)
21,219,470
(440,000)
(515,061)
(258,846)
19,610
8,937
23,638
-
Company
Gross dividends from subsidiaries
Management fees from subsidiaries
Rental income from a subsidiary
Additional investment in subsidiary
Advances (from)/to or repayment (to)/from subsidiaries, net:
- Sunshine Supermarket & Departmental Store Sdn. Bhd.
- Crimson Omega Sdn. Bhd.
- Sunshine Wholesale Mart Sdn. Bhd.
- Magirex Sdn. Bhd.
- Aljano Sdn. Bhd.
- Sunshine (Labuan) Private Limited
- Sunshine Amanjaya Sdn. Bhd.
- Sunshine Amanjaya Pte Ltd
- Silver Resort Sdn. Bhd.
- PT Sunshine Amanjaya Indonesia
Datin Cheah Gaik Huang and Hwang Siew Peng are also deemed interested in the transactions in which
Dato Hwang Thean Long has an interest by virtue of their family relationships.
Information regarding outstanding balances arising from related party transactions as at 31 May 2014 are
disclosed in Notes 24 and 36.
98
39.
1,564,874
108,754
1,673,628
1,590,758
111,497
1,702,255
307,600
307,600
307,600
307,600
1,583,982
2013
RM
1,615,395
Company
2014
RM
307,600
2013
RM
307,600
Fair value of financial instruments by classes that are carried at fair value
The following table shows an analysis of financial instruments carried at fair value by level of fair value
hierarchy :
2014
Financial assets
Investment securities
Quoted equity instruments (Note 20)
Short term investments
- Quoted unit trust funds (Note 27)
- Unquoted investments (Note 27)
Level 1
RM
Level 2
RM
Level 3
RM
Total
RM
3,114
3,114
17,036,600
-
7,272,496
17,036,600
7,272,496
3,114
3,114
9,509,662
-
4,189,173
9,509,662
4,189,173
2013
Financial assets
Investment securities
Quoted equity instruments (Note 20)
Short term investments
- Quoted unit trust funds (Note 27)
- Unquoted investments (Note 27)
Fair value hierarchy
The Group and the Company classify fair value measurement using a fair value hierarchy that reflects the
significance of the inputs used in making the measurement. The fair value hierarchy has the following levels:
Level 1 : Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 : Inputs other than quoted prices included within Level 1 that are observable for the asset or liability,
either directly (i.e., as prices) or indirectly (i.e., derived from prices).
Level 3 : Inputs for the assets and liability that are not based on observable market data (unobservable
inputs).
99
40.
Fair value of financial instruments by classes that are not carried at fair value and whose carrying
amounts are reasonable approximation of fair value
The following are classes of financial instruments that are not carried at fair value and whose carrying
amounts are reasonable approximation of fair value:
Note
Trade and other receivables
Loan receivables
Bank borrowings (current)
Bank borrowings (non-current)
Trade and other payables (current)
Trade and other payable (non-current)
24
26
33
33
36
36
The carrying amounts of these financial assets and liabilities are reasonable approximation of fair values,
either due to their short-term nature or that they are floating rate instruments that are re-priced to market
interest rates on or near the reporting date.
The carrying amounts of the bank borrowings are reasonable approximations of fair values due to the
insignificant impact of discounting.
The fair values of bank borrowings are estimated by discounting expected future cash flows at market
incremental lending rate for similar types of lending, borrowing or leasing arrangements at the reporting date.
41.
100
41.
(c)
(198,834)
198,834
858,071
(858,071)
Liquidity risk
Liquidity risk is the risk that the Group or the Company will encounter difficulty in meeting financial obligations
due to shortage of funds. The Groups and the Companys exposure to liquidity risk arises primarily from
mismatches of the maturities of financial assets and liabilities. The Groups and the Companys objective is
to maintain a balance between continuity of funding and flexibility through the use of stand-by credit facilities.
The Group and the Company manage their debt maturity profile, operating cash flows and the availability
of funding so as to ensure that all refinancing, repayment and funding needs are met. As part of its overall
liquidity management, the Group and the Company maintain sufficient levels of cash or cash convertible
investments to meet their working capital requirements. In addition, the Group and the Company strive to
maintain available banking facilities of a reasonable level to its overall debt position. Furthermore, the Group
and the Company are able to raise funds from both capital markets and financial institutions and balance
its portfolio with combination of a mixture of short and long term fundings so as to achieve overall cost
effectiveness.
101
41.
Group
Financial liabilities:
Trade payables
Other payables
Borrowings
Total undiscounted financial
liabilities
2014
One to
five years
RM
Over
five years
RM
Total
RM
49,045,924
12,290,134
7,237,892
4,501,000
7,202,630
3,536,500
7,359,041
49,045,924
20,327,634
21,799,563
68,573,950
11,703,630
10,895,541
91,173,121
346,755
21,491,409
346,755
21,491,409
21,838,164
21,838,164
2013
One to
five years
RM
Over
five years
RM
Total
RM
46,502,533
10,123,186
13,525,942
3,637,800
1,545,312
4,547,250
-
46,502,533
18,308,236
15,071,254
70,151,661
5,183,112
4,547,250
79,882,023
330,751
23,507,177
330,751
23,507,177
23,837,928
23,837,928
On demand or
within one year
RM
Company
Financial liabilities:
Other payables
Amounts due to subsidiaries
Total undiscounted financial
liabilities
Group
Financial liabilities:
Trade payables
Other payables
Borrowings
Total undiscounted financial
liabilities
On demand or
within one year
RM
Company
Financial liabilities:
Other payables
Amounts due to subsidiaries
Total undiscounted financial
liabilities
102
41.
Credit risk
Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default
on its obligations. The Groups and the Companys exposure to credit risk arises primarily from trade and other
receivables. For other financial assets (including investment securities, cash and bank balances and derivatives),
the Group and the Company minimise credit risk by dealing exclusively with high credit rating counterparties.
The Groups objective is to seek continual revenue growth while minimising losses incurred due to increased
credit risk exposure. The Group trades only with recognised and creditworthy third parties. It is the Groups
policy that all customers who wish to trade on credit terms are subject to credit verification procedures. In
addition, receivable balances are monitored on an ongoing basis with the result that the Groups exposure to
bad debts is not significant.
For transactions that do not occur in the country of the relevant operating unit, the Group does not offer credit
terms without the approval.
i.
The carrying amount of each class of financial assets recognised in the statements of
financial position.
(b)
Information regarding credit enhancements for trade and other receivables are disclosed in Note 24.
ii.
By country:
Within Malaysia
Germany
Switzerland
Singapore
Other countries
Total
iii.
2014
RM
12,428,456
890,306
34,664
1,987,164
2,415,813
17,756,403
%
70
5
11
14
100
2013
RM
17,052,605
1,277,345
316,150
2,505,158
1,155,525
22,306,783
%
77
6
1
11
5
100
iv.
103
41.
42.
Capital management
The primary objective of the Groups capital management is to ensure that it maintains a strong credit rating and
healthy capital ratios in order to support its business and maximise shareholder value.
The Group manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To
maintain or adjust the capital structure, the Group may adjust the dividend payment to shareholders, return capital to
shareholders or issue new shares. No changes were made in the objectives, policies or processes during the years
ended 31 May 2014 and 31 May 2013.
The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Group
includes within net debt, borrowings, trade and other payables, less short term investments and cash and bank
balances. Capital includes equity attributable to the owners of the parent.
Group
2014
RM
Note
Borrowings
Trade and other payables
Less: - short term investments
- cash and bank balances
Net debt
33
36
27
28
18,029,254
67,496,261
(24,309,096)
(27,844,565)
33,371,854
14,891,564
62,532,923
(13,698,835)
(32,199,611)
31,526,041
199,835,424
185,575,853
233,207,278
217,101,894
14%
15%
Gearing ratio
43.
2013
RM
Segment information
For management purposes, the Group is organized into business units based on their products and services, and
there are four reportable operating segments as follows:
(i)
(ii)
(iii)
(iv)
Trading
The directors are of the opinion that all inter-segment transactions have been entered into in the normal course of
business and have been established on terms and conditions that are not materially different from those obtained in
transaction with unrelated parties.
There are minimal inter-segment sales within the Group.
104
Trading
Eliminations Consolidated
RM
RM
RM
RM
RM
RM
306,075,503
65,214,393
6,655,437
219,685
378,165,018
227,208
3,377,088
(3,604,296)
306,302,711
65,214,393
10,032,525
219,685
(3,604,296)
378,165,018
10,203,031
6,244,924
(1,467,227)
143,179
15,123,907
137,437
608,905
835,610
Results
Segment results
Interest income
89,268
Finance costs
(1,172,674)
57,768
14,844,611
3,056,102
17,900,713
Assets
Segment assets
Investment in a joint venture
85,310,160
100,239,250
86,021,792
2,929,733
274,500,935
12,068,371
12,068,371
Unallocated assets
4,275,058
Total assets
290,844,364
Liabilities
Segment liabilities
52,342,254
13,872,891
1,306,813
2,107,939
69,629,897
Unallocated liabilities
20,503,209
Total liabilities
90,133,106
16,728,343
9,633,402
254,301
132,680
26,748,726
374,070
215,266
589,336
3,019,664
3,915,329
3,511,115
50,068
10,496,176
46,057
(173,906)
(347)
(128,196)
105
Trading
Eliminations Consolidated
RM
RM
RM
RM
RM
RM
297,210,139
72,125,986
2,998,425
372,334,550
193,742
3,394,588
(3,588,330)
297,403,881
72,125,986
6,393,013
(3,588,330)
372,334,550
11,679,649
10,353,656
(2,297,047)
182,207
363,713
Results
Segment results
Interest income
51,031
(968,292)
-
(1,341)
Finance costs
18,767,966
595,610
(172,005)
(4,627)
19,186,944
(5,490,184)
13,696,760
Assets
Segment assets
Investment in a joint venture
107,160,411
96,491,890
51,456,397
2,662,624
257,771,322
12,068,577
12,068,577
Unallocated assets
675,660
Total assets
270,515,559
Liabilities
Segment liabilities
47,801,777
13,335,302
1,163,054
2,020,694
64,320,827
Unallocated liabilities
19,811,647
Total liabilities
84,132,474
27,572,833
1,237,426
51,989
28,862,248
215,266
215,266
2,364,382
3,960,419
3,484,706
42,420
9,851,927
241,412
712,977
58,501
381,204
1,394,094
106
43.
Geographical segments
The Group operates locally except for the manufacturing segment which has a wholly owned subsidiary in
India. All of the Group's manufacturing activities are conducted in Malaysia while the overseas subsidiary is
principally engaged in the design of flexible printed circuit boards.
The following table provides an analysis of the Group's revenue, segment assets and capital expenditure by
geographical segment:
2014
Total revenue from external
customers
Segment assets
Capital expenditure
Malaysia
RM
Singapore,
India,
Philippines,
Sri Lanka,
Vietnam and
Thailand
RM
Korea,
Hong Kong,
Taiwan and
Japan
RM
United
States of
America,
Europe
and
New Zealand
RM
357,204,166
268,051,815
26,748,726
3,035,237
6,449,120
-
1,725,780
-
16,199,835
-
378,165,018
274,500,935
26,748,726
355,255,055
251,177,566
28,862,248
2,615,286
6,593,756
-
1,687,555
-
12,776,654
-
372,334,550
257,771,322
28,862,248
Consolidated
RM
2013
Total revenue from external
customers
Segment assets
Capital expenditure
44.
Subsequent events
There were no material events subsequent to the end of the year except as follows:
(i)
On 1 July 2014, a subsidiary, Qdos Interconnect Sdn. Bhd. has obtained approval from Malaysian Industrial
Development Authority (MIDA) for the following incentives subject to certain conditions being complied with:
(a)
100% tax exemption on its statutory income on Molded Interconnect Substrate (MIS). The
subsidiary has yet to submit an application to the Ministry of International Trade and Industry to fix
its Production Date;
(b)
matching research and development grant of 50% up to a maximum of RM3,146,200 for 3 years
from year 2014;
(c)
matching training grant of 50% up to a maximum of RM142,000 for 3 years from year 2014;
(d)
matching modenisation grant of 50% to purchase Auto Vertical 3 in 1 copper platting machine up to
a maximum of RM1,211,000 for 3 years from year 2014.
(ii)
On 8 August 2014, a subsidiary, Crimson Omega Sdn. Bhd. has fully settled its term loan amounting to
RM1,485,042.
(iii)
On 15 August 2014, a subsidiary, Qdos Flexcircuits (India) Private Limited (Qdos India) has increased its
authorized share capital from Rs. 100,000,000 to Rs. 150,000,000 divided into 15,000,000 equity shares of
Rs. 10 each ranking pari passu with the existing equity shares of Qdos India.
107
44.
45.
On 15 August 2014, a subsidiary, Qdos Flexcircuits Sdn. Bhd. has increased its investment in its subsidiary,
Qdos Flexcircuit (India) Private Limited ("Qdos India") for an amount of USD2,000,000 in order for Qdos India
to subscribe 12,000,000 equity shares of the face value of Rs.10 each in Exora Technologies Private Limited
("Exora") by way of issuance of rights issue. Exora will utilise part of the investment monies to acquire 5,000
equity shares in the capital of Unival Willows Estate Pvt. Ltd. ("Unival Willows") from Unitech Holdings Private
Limited.
(v)
On 18 August 2014, the board of directors of a subsidiary, Qdos Flexcircuits Sdn. Bhd., has approved the
purchase of a property known as Unit 225A, Bridgewater Lane, Milpitas, California 95035, United States of
America for a cash consideration of USD623,415.
(vi)
On 27 August 2014, a subsidiary, Sunshine Supermarket & Departmental Store Sdn Bhd, has drawn down
a cash line facility-i Bai-Bithaman Ajil which has a limit of RM8,000,000 and bears profit rate of 6.00% per
annum and is repayable over 60 months. It is secured by:
(a)
a fixed charged over a freehold land and building known as 1, Persiaran Dagangan, Pusat Bandar
Bertam Perdana, 13200 Kepala Batas; and
(b)
a corporate guarantee from the Company for all monies due and owing under the facilities.
108
SUPPLEMENTARY INFORMATION
46.
2013
RM
Company
2014
RM
2013
RM
157,491,254
100,468
157,591,722
134,701,741
(1,239,217)
133,462,524
38,564,257
38,564,257
29,901,976
29,901,976
12,344
(45,424)
(1,513,625)
(118,101)
131,785,374
(12,922,736)
118,862,638
38,564,257
38,564,257
29,901,976
29,901,976
(1,513,625)
(118,101)
155,972,340
(22,785,124)
133,187,216
109
Land Area /
Built Up Area
Tenure
Age Of
Building
Net Book
Value
(RM)
Location
Description
33,000 sq ft &
34,584 sq ft
99 years
leasehold
expiring
2090
21 years
23,500,291
Leasehold land
with a warehouse
and 3 storey office
block
61,237 sq ft &
37,600 sq ft
60 years
leasehold
expiring
2050
22 years
4,213,283
Freehold land
501,376 sq ft
Freehold
land
Not
Applicable
4,470,910
Leasehold land
392,434 sq ft /
126,325 sq ft
99 years
leashold
expiring
2104
Not
Applicable
21,833,932
Leasehold land
with double
storey factory
building
87,806 sq ft &
87,000 sq ft
60 years
leasehold
expiring
2049
14 years
8,830,674
Condominium
2,281 sq ft
99 years
leashold
expiring
2090
13 years
1,002,078
67,972 sq ft &
91,035 sq ft
9 years
leasehold
expiring
2017
6 years
194,791
Leasehold land
with a warehouse
64,400 sq ft
16 years
leasehold
expiring
2023
4 year
1,965,494
1, Persiaran Dagangan,
Pusat Bandar Bertam Perdana,
13200 Kepala Batas,
Penang
727,229 sq ft
Freehold
land
Not
Applicable
37,589,630
110
ANALYSIS OF SHAREHOLDINGS
AS AT 8 OCTOBER 2014
Class of Shares
Voting Rights
No. of Shares
2,272
200,096
3,988,712
6,334,843
17,187,506
29,601,019
57,314,448
%
0.00
0.35
6.96
11.05
29.99
51.65
100.00
# This represents the total issued and paid up capital of RM61,000,248, comprising of 61,000,248 Shares after deducting
3,685,800 Shares retained by the Company (or SCB) as treasury shares.
30 Largest Securities Account Holders
(without aggregating the securities from different securities accounts belonging to the same person)
No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
Name
HOZONE SDN.BHD.
SUIWAH HOLDINGS SDN. BHD.
DAUNPURI SDN. BHD.
SUIWAH HOLDINGS SDN. BHD.
DATO HWANG THEAN LONG
WONG THAN KIM
DATO HWANG THEAN LONG
HLB NOMINEES (TEMPATAN) SDN BHD
(PLEDGED SECURITIES ACCOUNT FOR LIM CHAI BENG)
LENA LEONG OY LIN
LOOI TIK MIOW
HO SAM FONG
LIM KENG HONG
UNG PENG JOO
LEONG KOK TAI
TEO KWEE HOCK
KENANGA NOMINEES (TEMPATAN) SDN BHD
(PLEDGED SECURITIES ACCOUNT FOR Y.B. SENATOR DATO HAJI MOHD SUHAIMI
BIN ABDULLAH)
BARBARA ELIZABETH NG
JF APEX NOMINEES (TEMPATAN) SDN BHD
(PLEDGED SECURITIES ACCOUNT FOR TEO SIEW LAI)
LENA LEONG OY LIN
CHAN SENG CHEONG
TAWAKAR ENTERPRISE SDN. BHD.
CIMSEC NOMINEES (TEMPATAN) SDN BHD
(PLEDGED SECURITIES ACCOUNT FOR IRENE YEOH POH IM)
CH'NG BOON CHONG
LEE ENG HOCK & CO. SENDIRIAN BERHAD
KANG KHOON SENG
YEAP SHIEW LAN
ALLIANCEGROUP NOMINEES (TEMPATAN) SDN BHD
(PLEDGED SECURITIES ACCOUNT FOR OOI CHIN HOCK)
DATO POH BIN SENG
YEO KHEE HUAT
INTER-PACIFIC EQUITY NOMINEES (TEMPATAN) SDN BHD
(HO SOO TAK)
No. of
Shares held
12,117,948
7,591,200
6,595,171
3,296,700
2,296,881
2,207,380
2,148,500
2,000,000
% #
21.14
13.24
11.51
5.75
4.01
3.85
3.75
3.49
1,428,600
668,300
597,000
546,600
464,400
459,600
430,800
417,125
2.49
1.17
1.04
0.95
0.81
0.80
0.75
0.73
364,800
300,000
0.64
0.52
288,700
230,820
200,000
193,000
0.50
0.40
0.35
0.34
192,700
190,000
180,000
180,000
172400
0.34
0.33
0.31
0.31
0.30
172,000
168,380
163,800
0.30
0.29
0.29
111
ANALYSIS OF SHAREHOLDINGS
AS AT 8 OCTOBER 2014 (CONTD.)
Note
(i)
(ii)
(iii)
(iv)
Notes :
(i)
Deemed interested through his shareholdings in SHSB and SSSB by virtue of Section 6A of the Act and the shareholdings
of his wife, Datin Cheah Gaik Huang in SCB.
(ii)
Deemed interested through the shareholdings of her husband, Dato' Hwang Thean Long in SCB.
(iii)
Deemed interested through his shareholdings in Hozone Sdn Bhd pursuant to Section 6A of the Act.
(iv)
Deemed interested through the shareholdings of her parents, Dato' Hwang Thean Long and Datin Cheah Gaik Huang
in SCB.
112
113
PROXY FORM
No. of Shares held
I/We ___________________________________________________________________________________________________________
(FULL NAME IN CAPITAL LETTERS)
of _____________________________________________________________________________________________________________
(FULL ADDRESS)
For
Against
(Please indicate with an X in the appropriate box against each Resolution how you wish your proxy to vote. If no instruction is given, the
proxy will vote or abstain at his/her discretion).
* Strike out whichever not applicable.
Signed this day of 2014.
Signature of Shareholder/Common Seal
Notes:
1. In respect of deposited securities, only members whose names appear in the Record of Depositors on 10 November 2014 (General Meeting Record of
Depositors) shall be eligible to attend, speak and vote at the Meeting.
2. A member entitled to attend and vote at the Meeting is entitled to appoint two (2) or more proxies to attend and vote in his or her stead. Where a member
appoints two (2) proxies, the appointments shall be invalid unless he or she specifies the proportions of his or her shareholdings to be represented by each
proxy.
3. A proxy may but does not need to be a member. There shall be no restriction as to the qualification of the proxy and the provision of Section 149 (1)(a), (b)
and (c) of the Companies Act, 1965 shall not apply to the Company. A proxy appointed to attend and vote at the Meeting shall have the same rights as the
member to speak at the Meeting.
4. The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing or, if the appointor is a
corporation, either under its seal or under the hand of an officer or attorney duly authorised.
5. Where a member of the Company is an exempt authorised nominee as defined under Securities Industry (Central Depositories) Act 1991 which holds ordinary
shares in the Company for multiple beneficial owners in one securities account (omnibus account), there is no limit to the number of proxies which the
exempt authorised nominee may appoint in respect of each omnibus account it holds.
6. The instrument appointing a proxy and the power of attorney or other authority if any, under which it is signed or a notarially certified copy of the power or
authority shall be deposited at the registered office of the Company at No. 1-20-1 SUNTECH @ Penang Cybercity, Lintang Mayang Pasir 3, 11950 Bayan
Baru, Penang not less than forty-eight (48) hours before the time for holding the meeting or any adjournment thereof.
7. Any alteration in this form must be initialed.
stamp
No. 1-20-1, SUNTECH @ Penang Cybercity, Lintang Mayang Pasir 3, 11950 Bayan Baru, Penang, Malaysia .
Tel: 604-643 7387 Fax: 604-643 7389 www.suiwah.com.my | www.sunshineonline.com.my