ATLAN HOLDINGS BHD report/documents/ATLAN...List of Properties 137 Notice of Annual General Meeting...

Correspondence address :

16th Floor, Menara Atlan 161B, Jalan Ampang 50450 Kuala Lumpur

Tel : 603 2179 2000 Fax : 603 2179 2390

www.atlan.com.my

annual report

2012laporan tahunan

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Table of ContentsCorporate Information 2

Corporate Structure 3

Directors’ Profile 4

Financial Highlights 7

Chairman Statement 8

Statement on Corporate Governance 14

Additional Compliance Information 19

Audit Committee Report 21

Statement on Internal Control 25

Corporate Social Responsibility 27

Financial Statements 29

Analysis of Shareholdings 134

List of Properties 137

Notice of Annual General Meeting 141

Appendix I 143

Form of Proxy

2

ATLAN HOLDINGS BHD (173250-W) I annual report 2012

Corporate Information

BOARD OF DIRECTORS

Dato’ Sri Adam Sani Bin Abdullah Tengku Abdul Rahman Ibni Sultan HajiChairman Ahmad Shah Al-Mustain Billah, DK II, SSAPNon-Executive Director Independent Non-Executive Director

Ong Bok Siong Dato’ Shagul Hamid Bin K.R. Williams @ AbdullahGroup Managing Director Independent Non-Executive Director

Lee Sze Siang Mohd Sharif Bin Hj YusofExecutive Director Independent Non-Executive Director

Dato’ Woo Hon Kong Jeneral Dato’ Sri Abdullah Bin Ahmad @Non-Executive Director Dollah Bin Amad (B) Independent Non-Executive Director

AUDIT COMMITTEE

Mohd Sharif Bin Hj Yusof (Chairman)Dato’ Shagul Hamid Bin K.R. Williams @ AbdullahJeneral Dato’ Sri Abdullah Bin Ahmad @ Dollah Bin Amad (B)

REMUNERATION COMMITTEE

Dato’ Sri Adam Sani Bin Abdullah (Chairman)Jeneral Dato’ Sri Abdullah Bin Ahmad @ Dollah Bin Amad (B)Dato’ Shagul Hamid Bin K.R. Williams @ Abdullah

NOMINATION COMMITTEE

Dato’ Sri Adam Sani Bin Abdullah (Chairman)Tengku Abdul Rahman Ibni Sultan Haji Ahmad Shah Al-Mustain Billah, DK II, SSAPDato’ Shagul Hamid Bin K.R. Williams @ Abdullah

COMPANY SECRETARIES

Chua Siew Chuan (MAICSA 0777689)Thum Sook Fun (MAICSA 7025619)

REGISTERED OFFICE

Level 4, Wisma Atlan, 8 Persiaran Kampung Jawa11900 Bayan Lepas, Penang, MalaysiaTel: 604 – 641 3200Fax: 604 – 641 3303

INVESTOR RELATIONS

Ong Bok Siong16th Floor, Menara Atlan, 161B Jalan Ampang50450 Kuala Lumpur, MalaysiaTel: 603 – 2179 2000Fax: 603 – 2179 2390Email: [email protected]

CORRESPONDENCE ADDRESS

16th Floor, Menara Atlan, 161B Jalan Ampang50450 Kuala Lumpur, MalaysiaTel: 603 – 2179 2000Fax: 603 – 2179 2390 Web: http://www.atlan.com.my

SHARE REGISTRAR

Symphony Share Registrars Sdn Bhd (378993-D)Level 6, Symphony HousePusat Dagangan Dana 1Jalan PJU 1A/46, 47301 Petaling JayaSelangor, MalaysiaTel: 603 – 7841 8000Fax: 603 – 7841 8151 / 8152

PRINCIPAL BANKERS

Affin Bank BerhadBank Islam Malaysia BerhadBank Kerjasama Rakyat Malaysia BerhadRHB Bank Berhad

AUDITORS

Ernst & Young21st Floor, MWE Plaza8 Lebuh Farquhar10200 PenangMalaysiaTel: 604 – 263 0033 Fax: 604 – 263 0099

STOCK EXCHANGE LISTING

Main Market of Bursa Malaysia Securities BerhadStock Name: AtlanStock Code: 7048Stock Sector: Industrial ProductsListing Date: 15 January 1996

3

Corporate Structureas at 13 June 2012

50%

50%

38.06%Naluri Corporation Berhad

57.67%100%

28%United Filter Sdn. Bhd.

69%100%

70%

19%

81%100%

100%

100%

100%

100%

100%

100%

100%

100%

100%1%

100%

100%

100%

100%

100%

100%

99%100%

100%

51%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

Principal Assets Pte. Ltd.

Arah Induk Sdn. Bhd.

Seven Wonders Of The World Sdn. Bhd.

Atlan Orient Sdn. Bhd.

Darul Metro Sdn. Bhd.

Atlan Capital Sdn. Bhd.

MHS Land Sdn. Bhd.

UVI Advance Technology Sdn. Bhd.

United Vehicles Industries Sdn. Bhd. Kadar Prisma Sdn. Bhd.

Fleet Car Hire & Tours Sdn. Bhd.

Atlan Assets Sdn. Bhd.

Belia Karisma Sdn. Bhd.

United Industries Sdn. Bhd.100%

100%

100%

100%

100%

DFZ Capital Berhad

Selasih Ekslusif Sdn. Bhd.

Winner Prompt Sdn. Bhd.

Emas Kerajang Sdn. Bhd.

Front Top (M) Sdn. Bhd.

Seruntun Maju Sdn. Bhd.

Binamold Sdn. Bhd.

DFZ Asia Sdn. Bhd.

Tenggara Senandung Sdn. Bhd.

Orchard Boulevard Sdn. Bhd.

DFZ Tours & Travel Sdn. Bhd.

Media Zone Sdn. Bhd.

DFZ Duty Free (Langkawi) Sdn. Bhd.

First Influx Sdn. Bhd.

Jelita Duty Free Supplies Sdn. Bhd.

Zon Emporium Sdn. Bhd.

DFZ (M) Sdn. Bhd.

Wealthouse Sdn. Bhd.

Jasa Duty Free Sdn. Bhd.

DFZ Duty Free Supplies Sdn. Bhd.

Melaka Duty Free Sdn. Bhd.

Cergasjaya Sdn. Bhd.

DFZ Emporium Sdn. Bhd.

DFZ Trading Sdn. Bhd.

TRIM Capital Management (M) Sdn. Bhd.

International Aviation Consultants Sdn. Bhd.

Timeless Image Sdn. Bhd.

Blossom Time Sdn. Bhd.

Ocean Pride Sdn. Bhd.

Radiant Ranch Sdn. Bhd.

Scandinavian Avionics (Malaysia) Sdn. Bhd.

Zon Hospitality Services Sdn. Bhd.

Tegapasti Sdn. Bhd.

RZ Equities Sdn. Bhd.

Naluri Properties Sdn. Bhd.

United Industries Holdings Sdn. Bhd.

Trifiniti Networks Sdn. Bhd.

Atlan Management Sdn. Bhd.

Atlan Development Sdn. Bhd.

Duty Free International Limited

Atlan Technology Sdn. Bhd.

Naluri International Limited

United Sanoh Industries Sdn. Bhd.

Danco Marketing Sdn. Bhd.

Freighter Industries (M) Sdn. Bhd.

UEW Plastic Industries Sdn. Bhd.

PT DFZ Indon

Cergasjaya Properties Sdn. Bhd.

Black Forest Golf And Country Club Sdn. Bhd.

Gold Vale Development Sdn. Bhd.

Kelana Megah Sdn. Bhd.

Tropika Ferringhi Management Sdn. Bhd.

Gardenia Success Sdn. Bhd.

100%

100%

100%

100%

100%

100%

100%

100%

100%

51%

81.15%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

25%

100%

100%

Atlan Properties Sdn. Bhd.

4


Directors’ Profile

DATO’ SRI ADAM SANI BIN ABDULLAHChairmanNon-Executive Director

DATO’ SRI ADAM SANI BIN ABDULLAH, a Malaysian, age 56, was appointed as Chairman of the Company on 16 June 2000.

Dato’ Sri Adam is a self-made entrepreneur for more than 30 years. He received his primary education in Malaysia and secondary education in the United Kingdom.

Dato’ Sri Adam also serves as Chairman of the Remuneration and Nomination Committees of the Company. He is also the Executive Chairman of Naluri Corporation Berhad and Non-Executive Chairman of Duty Free International Limited, a company listed on the Catalist Board of the Singapore Exchange Securities Trading Limited.

Dato’ Sri Adam does not have any family relationship with any director and other major shareholder save for Mr. Sebastian Paul Lim Chin Foo, a substantial shareholder of the Company, who is the son of Dato’ Sri Adam.

Dato’ Sri Adam has no conflict of interests with the Company.

ONG BOK SIONGGroup Managing Director

ONG BOK SIONG, a Malaysian, age 53, was appointed as Executive Director of the Company on 26 August 2010 and subsequently re-designated as Group Managing Director on 30 April 2012.

He holds a Bachelor of Laws degree from the University of London, United Kingdom, Bachelor of Science degree in Building Economics and Quantity Surveying (first class honours) from the Heriot-Watt University, Scotland, United Kingdom and Diploma in Building Technology from Tunku Abdul Rahman College. He also holds professional membership with various professional bodies.

He started his career in the construction and property industry since 1983 and had been involved in mega construction and property development projects. He was the Chief Executive Officer and Executive Director of Meda Inc. Berhad and Group Chief Executive Officer of Andaman Consolidated Sdn Bhd Group before joining Atlan Holdings Bhd. Group.

He does not have any family relationship with any director and/or major shareholder of the Company and has no conflict of interests with the Company.

LEE SZE SIANGExecutive Director

LEE SZE SIANG, a Malaysian, age 41, was appointed as Executive Director of the Company on 16 June 2000. He was re-designated to Non-Executive Director on 27 December 2004 and subsequently re-designated as Executive Director of the Company on 8 October 2008.

He holds a professional qualification from the Australian Society of Certified Practicing Accountants. He is also a member of the Malaysian Institute of Accountants. Previously, he was with KPMG, a firm of public accountants.

He is a Director of Naluri Corporation Berhad and Executive Director (Finance and Corporate Services) of Duty Free International Limited, a company listed on the Catalist Board of the Singapore Exchange Securities Trading Limited.

Lee Sze Siang does not have any family relationship with any director and/or major shareholder of the Company and has no conflict of interests with the Company.

5

Directors’ Profile (cont’d)

TENGKU ABDUL RAHMAN IBNI SULTAN HAJI AHMAD SHAH AL-MUSTAIN BILLAH, DK II, SSAPIndependent Non-Executive Director

TENGKU ABDUL RAHMAD IBNI SULTAN HAJI AHMAD SHAH AL-MUSTAIN BILLAH, a Malaysian, age 52, was appointed as an Independent Non-Executive Director of the Company on 9 October 2000.

He was educated at Harrow College, United Kingdom in Business Administration. He was a Director on the Board of Public Bank Berhad from 1983 to March 2011. He also served as a Director for Public Islamic Bank Berhad and Public Investment Bank Berhad till March 2011.

Tengku Abdul Rahman also serves as a member of the Nomination Committee of the Company.


DATO’ SHAGUL HAMID BIN K.R. WILLIAMS @ ABDULLAHIndependent Non-Executive Director

DATO’ SHAGUL HAMID BIN K.R. WILLIAMS @ ABDULLAH, a Malaysian, age 63, was appointed as an Independent Non-Executive Director of the Company on 30 December 2004.

He holds B.A. (Hons), 2nd Lower, Degree in English Studies, University of Malaya (1973). He joined the Pensions Division of Public Services Department as Assistant Director in 1973 and was subsequently promoted and has held various positions in the Public Sector. His last held position as a full-time public servant was as Head of Languages Division in the National Institute of Public Administration Kuala Lumpur (INTAN) in 1997. However, he had been back several times in the Public Sector, to hold several contract positions.

Dato’ Shagul serves as a member of the Audit and Nomination Committees of the Company. He does not have any family relationship with any director and/or major shareholder of the Company and has no conflict of interests with the Company.

JENERAL DATO’ SRI ABDULLAH BIN AHMAD @ DOLLAH BIN AMAD (B)Independent Non-Executive Director

JENERAL DATO’ SRI ABDULLAH BIN AHMAD @ DOLLAH BIN AMAD (B), a Malaysian, age 63, was appointed as an Independent Non-Executive Director of the Company on 26 January 2011.

He is graduated from Royal Air Force Staff College in Bracknell, United Kingdom in 1982. He holds Master Degree in International Relations and Strategic Studies from University of Lancaster, United Kingdom in 1986. He joined the Royal Malaysian Air Force (“RMAF”) in 1968 as a cadet officer and had served the RMAF for 36 years before retiring as the Chief of RMAF in 2004 with last rank as General.

He serves as a member of the Audit and Remuneration Committees of the Company.


6


DATO’ WOO HON KONGNon-Executive Director

DATO’ WOO HON KONG, a Malaysian, age 47, was appointed as Non-Executive Director of the Company on 24 April 2002. He was re-designated to the Executive Director position on 5 July 2002 and subsequently re-designated as Non-Executive Director of the Company on 30 October 2008.

He holds a Bachelor of Laws degree from the University of Canterbury, New Zealand. He started his career in 1988 as a legal assistant and joined a mid size legal firm as a partner in 1989 until 1994. He subsequently oversees the management and financial matters of companies involved in real estate and equities market locally and overseas prior to joining Atlan Group.

Dato’ Woo does not hold directorship in any other public companies in Malaysia. He does not have any family relationship with any director and/or major shareholder of the Company and has no conflict of interests with the Company.

MOHD SHARIF BIN HJ YUSOFIndependent Non-Executive Director

MOHD SHARIF BIN HJ YUSOF, a Malaysian, age 73, was appointed as an Independent Non-Executive Director of the Company on 23 January 2009.

He is a Fellow Member of the Institute of Chartered Accountants, England and Wales, an Associate Member of the Malaysian Institute of Accountants and a Member of the Malaysian Institute of Certified Public Accountants. He has had more than 20 years experience in the government and financial sectors, serving the Selangor State Government, Bumiputra Merchant Bankers Berhad (now known as CIMB Bank Berhad) and thereafter British American Life & General Insurance Co Bhd (now known as Manulife Insurance (Malaysia) Berhad) where he held the position of Senior Vice President, Finance/Company Secretary at the time he retired.

He serves as Chairman of the Audit Committee of the Company.

He currently sits on the board of Ireka Corporation Berhad, Axis Reit Managers Berhad and AYS Ventures Bhd.


Directors’ Profile (cont’d)

7

Financial Highlights

Financial year ended FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

RM'000 RM'000 RM'000 RM'000 RM'000

Revenue 110,155 650,062 702,231 744,789 722,040

Profit before tax 4,636 59,997 116,841 73,700 158,298

Profit net of tax 3,585 44,322 105,469 50,265 128,232

Paid-up capital 210,008 235,400 253,650 253,650 253,650

Total equity 230,409 355,239 396,153 411,671 480,727

Net Assets per share (RM) 1.10 1.32 1.38 1.26 1.52

Earnings per share (sen) 2 19 40 12 46

Dividend per share (sen) - 7 15 17 14

Revenue Growth

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Profit Net of Tax

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

Earnings Per Share (Sen)

Dividend Per Share (Sen)

FY 2008 FY 2009 FY 2010 FY 2011 FY 2012

3.6

44.3

105.5

50.3

128.2

-

20

40

60

80

100

120

140

RM'000

650.1 702.2

744.8 722.0

100

200

300

400

500

600

700

800

RM'000

-

100 1.8

19.4

39.8

12.1

45.6

-5

10 15 20 25 30 35 40 45 50

15.0

17.0

14.016

18

-

7.0

-

2

4

6

8

10

12

14

16

110.2

8


Chairman Statement

FINANCIAL PERFORMANCE

During FY2012, Atlan and its subsidiaries (“Atlan Group”) generated revenue of RM722.0 million from its operations, which is 3.1% lower than the revenue in previous financial year of RM744.8 million.

The lower revenue in FY2012 is mainly due to the after effects of the tsunami in Japan in March 2011 and the prolonged flood in Thailand in October 2011 which caused disruptions to the supply chain in the automobile industry and, as such had affected the operations and revenue of the Automotive segment of the Atlan Group. The prolonged flood in Thailand also affected the revenue of the Duty free segment as the performance of the duty free outlets located in the northern region of Peninsular Malaysia was adversely affected by the lower tourist traffic at the Malaysia-Thailand border.

The lower revenue for FY2012 has affected the profits from the Duty free segment and Automotive segment, but the Atlan Group has for FY2012 achieved a profit after taxation of RM128.2 million which is significantly higher than the profit after taxation in the previous financial year of RM50.3 million. The higher profit in FY2012 is mainly due to the one-off net gain of RM83.0 million from the disposal of land in Atlan’s wholly owned-subsidiaries, Blossom Time Sdn. Bhd. and Radiant Ranch Sdn. Bhd., which was completed in May 2011.

CORPORATE DEVELOPMENTS AND OUTLOOK

FY2012 is an eventful year for Atlan Group. Fresh off the restructuring of DFZ Capital Berhad and Darul Metro Sdn. Bhd. (“DMSB”) into Duty Free International Limited (“DFI”), a public listed company in Singapore, which was completed in January 2011, Atlan Group faced challenges and obstacles in its operations from the natural disaster in Japan in March 2011, which affected its Automotive segment. Before the financial year ended, another natural disaster, this time in Thailand, affected both Duty free segment and Automotive segment of the Atlan Group.

However, Atlan Group managed to maintain its position in its Duty free segment and Automotive segment and generate respectable revenue for FY2012 with the hard work and dedication from its workforce. It also achieved a better profit for the financial year by seizing the opportunity to align its property development assets.

After a challenging year, Atlan Group is looking forward to FY2013 with cautious optimism despite the weak global and regional economic outlook, from the recovery of the tourist traffic at Malaysia-Thailand border and supply chains of the automotive industry. The occupancy for Menara Atlan at Jalan Ampang remains respectable amidst the increased supply of office space in the locality due to the competitive rates offered by Menara Atlan.

Atlan Group started the current financial year with a significant corporate exercise involving the subsidiaries in DFI Group (namely DMSB and Kelana Megah Sdn. Bhd. (“KMSB”)) and also Atlan Technology Sdn. Bhd. (“ATSB”), a wholly-owned subsidiary of Atlan. On 10

Bismillahir Rahmanir RahimAssalamu Alaikum wa Rahmatullahi wa Barakatuh

On behalf of the Board of Directors, it is my great pleasure to present the Annual Report and Financial Statements of Atlan Holdings Bhd. (“Atlan”) for the financial year ended 29 February 2012 (“FY2012”).

9

Chairman Statement (cont’d)

April 2012, DMSB and KMSB entered into conditional sale and purchase agreements with Pesaka Ikhlas (M) Sdn. Bhd. (“Pesaka”), for the disposal of DFI Group’s legal and beneficial interests over six land parcels located in The Zon Johor Bahru at Stulang Laut, Johor Bahru for RM325.00 million and for the disposal of an intended lease interest in one land parcel at Stulang Laut, Johor Bahru for RM27.99 million, respectively. On the same day, ATSB also entered into a conditional sale and purchase agreement with Pesaka for the disposal of legal and beneficial interests in one land parcel at Stulang Laut, Johor Bahru for RM32.01 million.

Pesaka is a wholly-owned subsidiary of Berjaya Times Square Sdn. Bhd., which in turn is a wholly-owned subsidiary of Berjaya Assets Berhad, a company listed on the Bursa Malaysia Securities Berhad.

Upon completion of the proposed disposals mentioned above, Atlan Group will continue to have a presence in The Zon Johor Bahru, as Selasih Ekslusif Sdn. Bhd., a subsidiary of DFI, will commence a 25-year tenancy over certain premises within the duty free zone, with complete and exclusive right over the entire supply chain associated to the import, supply and sale of liquor, spirits, beer, chocolate, tobacco products, perfumery and cosmetics within the duty free zone.

The abovementioned proposed disposals will enhance the financial position of Atlan Group and thereby creating a strong platform for Atlan Group to undertake further endeavours.

TREASURY SHARES

In FY2012, Atlan purchased with internally generated funds, 1,000 ordinary shares for a total consideration of RM4,000 (inclusive transaction cost). As at 29 February 2012, Atlan held 1,649,649 shares as treasury shares.

Subsequent to FY2012, Atlan had resold 1,649,600 treasury shares on the Bursa Malaysia Securities Berhad for a total consideration of RM6.6 million. The remaining 49 treasury shares were cancelled on 11 May 2012. After the resale and cancellation of the treasury shares, the Company no longer holds any treasury shares.

ACKNOWLEDGEMENT

I am pleased to welcome Mr. Ong Bok Siong as the Managing Director of Atlan, with effect from 30 April 2012. Mr. Ong brings with him extensive and diverse knowledge and experience and I am sure under his leadership, the Atlan Group will be able to attain a new level of achievement.

On behalf of the Board, I would like to express my utmost appreciation to the Government and its officers for constantly providing us invaluable advice and assistance.

I would like to thank all our shareholders, bankers, customers, suppliers, business partners, management and staffs for their continued support, not forgetting my fellow Directors; I appreciate their active participation.

On my part, I remain your humble and obedient servant and pledge to continue my commitment and diligence to the Atlan Group.

Thank you.Wasallamu Alaikum wa Rahmatullahi wa Barakatuh

Adam Sani Bin AbdullahChairman22 June 2012

10


Penyata Pengerusi

Bismillahir Rahmanir RahimAssalamu Alaikum wa Rahmatullahi wa Barakatuh

Bagi Pihak Lembaga Pengarah, saya dengan sukacitanya membentangkan Laporan Tahunan dan Penyata Kewangan Atlan Holdings Bhd (“Atlan”) bagi tahun kewangan berakhir 29 Februari 2012 (“tahun kewangan 2012”).

PRESTASI KEWANGAN

Pada tahun kewangan yang dikaji, Atlan dan anak-anak syarikatnya (“Kumpulan Atlan”) telah memperolehi pendapatan sebanyak RM722.0 juta dari operasi-operasinya, yang mana telah menurun sebanyak 3.1% berbanding dengan pendapatan untuk tahun kewangan sebelumnya iaitu RM744.8 juta.

Penurunan pendapatan dalam tahun kewangan 2012 adalah disebabkan oleh kesan tsunami yang berlaku di Jepun pada bulan Mac 2011 dan banjir yang berterusan di Thailand pada bulan Oktober 2011 yang mana telah menyebabkan kemusnahan kepada rangkaian bekalan dalam industri otomobil dan ini telah memberi kesan kepada operasi dan pendapatan untuk segmen Otomobil Kumpulan Atlan. Banjir yang berterusan di Thailand juga memberi kesan kepada pendapatan dalam segmen Bebas Cukai kerana prestasi kedai-kedai bebas cukai yang terletak di utara Semenanjung Malaysia telah teruk terjejas akibat lalu lintas pelancong yang menurun di sempadan Malaysia-Thailand.

Penurunan pendapatan untuk tahun kewangan 2012 telah memberikan kesan kepada keuntungan dari segmen Bebas Cukai dan segmen Otomotif, tetapi secara keseluruhan, Kumpulan Atlan mencapai keuntungan selepas cukai sebanyak RM128.2 juta yang mana ini adalah lebih tinggi berbanding dengan keuntungan selepas cukai untuk tahun sebelumnya iaitu sebanyak RM50.3 juta. Peningkatan keuntungan ini adalah disebabkan oleh keuntungan dari penjualan tanah anak-anak syarikat Atlan, iaitu Blossom Time Sdn. Bhd. dan Radiant Ranch Sdn. Bhd., berjumlah RM83.0 juta yang telah disempurnakan pada bulan Mei 2011.

PERKEMBANGAN SYARIKAT DAN TINJAUAN PERNIAGAAN

Tahun kewangan 2012 adalah tahun yang penuh dengan peristiwa untuk Kumpulan Atlan. Bermula dengan pengstrukturan DFZ Capital Berhad dan Darul Metro Sdn. Bhd. (“DMSB”) ke dalam Duty Free International Limited (“DFI”), sebuah syarikat awam tersenarai di Singapura, yang telah disempurnakan pada bulan Januari 2011 yang lalu, Kumpulan Atlan menghadapi cabaran dan halangan dalam operasi-operasinya kesan dari malapetaka yang menimpa Jepun pada Mac 2011, yang telah memberi kesan yang teruk kepada segmen Otomotif. Sebelum tahun kewangan berakhir, malapetaka lain yang berlaku di Thailand, yang memberi kesan kepada kedua-dua segmen Bebas Cukai dan segmen Otomotif Kumpulan Atlan.

Walaubagaimanapun, Kumpulan Atlan berjaya mengekalkan kedudukannya di segmen Bebas Cukai dan segmen Otomotif dan menjana pendapatan yang memberangsangkan untuk tahun kewangan 2012 dengan kerja kuat dan dedikasi dari tenaga kerjanya. Ia juga berjaya mencapai keuntungan yang lebih baik untuk tahun kewangan ini dengan mengambil peluang menyusun pembangunan hartanahnya.

Selepas tahun yang mencabar ini, Kumpulan Atlan menyambut tahun kewangan 2013 dengan sikap optimis dan berhati-hati biarpun dengan kelemahan global dan tinjauan ekonomi serantau, dari pemulihan lalu lintas pelancong di sempadan Malaysia-Thailand dan rangkaian bekalan industri otomotif. Jumlah ruang penyewaan di Menara Atlan di Jalan Ampang kekal di tahap membanggakan meskipun dengan penambahan ruang pejabat di sekitar, dan ini adalah kerana kadar kompetitif yang ditawarkan oleh Menara Atlan.

11

Penyata Pengerusi (samb)

Kumpulan Atlan memulakan tahun kewangan semasa dengan perlaksanaan prosedur korporat penting yang melibatkan anak-anak syarikat Kumpulan DFI (iaitu DMSB dan Kelana Megah Sdn. Bhd. (“KMSB”)) dan juga Atlan Technology Sdn. Bhd. (“ATSB”), anak syarikat milik penuh Atlan. Pada 10 April 2012, DMSB dan KMSB telah memeterai perjanjian jual beli bersyarat dengan Pesaka Ikhlas (M) Sdn. Bhd. (“Pesaka”), untuk penjualan hak dan kepentingan Kumpulan DFI ke atas 6 bidang tanah yang terletak di The Zon Johor Bahru di Stulang Laut, Johor Bahru untuk imbalan tunai sebanyak RM325.0 juta dan penjualan kepentingan cadangan pajakan ke atas satu bidang tanah di Stulang Laut, Johor Bahru sebanyak RM27.99 juta. Pada hari yang sama, ATSB juga memeterai satu perjanjian jual beli bersyarat dengan Pesaka untuk penjualan hak dan kepentingan ke atas satu bidang tanah di Stulang Laut, Johor Bahru untuk imbalan tunai sebanyak RM32.01 juta.

Pesaka ialah anak syarikat milik penuh Berjaya Times Square Sdn. Bhd. (“BTS”), yang mana BTS adalah anak syarikat milik penuh Berjaya Assets Berhad, sebuah syarikat tersenarai di Bursa Malaysia Securities Berhad.

Apabila sempurnanya cadangan-cadangan penjualan seperti yang di atas, Kumpulan Atlan masih mempunyai hak di The Zon Johor Bahru kerana Selasih Ekslusif Sdn. Bhd., anak syarikat DFI, akan memulakan satu penyewaan selama 25 tahun ke atas beberapa premis di zon bebas cukai, dengan hak ekslusif ke atas keseluruh rangkaian bekalan yang bersangkutan dengan import, membekal dan menjual minuman beralkohol, coklat, keluaran tembakau, minyak wangi dan kosmetik di dalam zon bebas cukai.

Cadangan-cadangan perlupusan di atas akan menguatkan kedudukan kewangan Kumpulan Atlan dan seterusnya membentuk satu platform yang kukuh untuk terus melaksanakan usaha-usaha di masa hadapan.

SAHAM PERBENDAHARAAN

Dalam tahun kewangan 2012, Atlan telah membeli balik 1,000 saham biasa berjumlah RM4,000 (termasuk kos) yang dibiayai oleh dana dalaman. Setakat 29 Februari 2012, Atlan telah memegang 1,649,649 saham sebagai saham perbendaharaan.

Selepas tahun kewangan 2012, Atlan telah menjual balik 1,649,600 saham perbendaharaan di Bursa Malaysia Securities Berhad berjumlah RM6.6 juta. Baki sebanyak 49 saham perbendaharaan telah dibatalkan pada 11 Mei 2012. Selepas penjualan semula dan pembatalan saham perbendaharaan ini, Atlan tidak lagi memegang apa-apa saham perbendaharaan.

UCAPAN TERIMA KASIH

Saya mengalu-alukan kedatangan Encik Ong Bok Siong selaku Pengarah Urusan Atlan, berkuatkuasa pada 30 April 2012. Encik Ong membawa bersamanya pelbagai pengalaman dan pengetahuan yang mendalam dan saya pasti di bawah pimpinan beliau, Kumpulan Atlan akan berjaya memperolehi satu tahap pencapaian yang baru.

Bagi pihak Lembaga Pengarah, saya ingin mengucapkan penghargaan kepada pihak Kerajaan dan para pengawainya di atas nasihat yang berharga dan bantuan yang berterusan.

Saya juga ingin mengucapkan terima kasih kepada para pemegang saham, bank-bank, para pelanggan yang dihormati, para pembekal, rakan kongsi perniagaan, pengurusan dan kakitangan kami di atas sokongan yang berterusan, dan tidak lupa juga kepada rakan-rakan ahli Lembaga Pengarah, saya sangat menghargai penyertaan aktif mereka.

Bagi diri saya, saya dengan rendah diri berjanji untuk sedia berkhidmat meneruskan komitmen saya kepada Kumpulan Atlan.

Terima kasih.Wasallamu Alaikum wa Rahmatullahi wa Barakatuh

Adam Sani Bin AbdullahPengerusi22 Jun 2012

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董事主席献词

我很荣幸代表董事会，提呈益联控股有限公司（“Atlan Holdings Bhd.”）截至 2012年2 月29 日财政年（“2012财政年”）的年度报告和财务报表。

财务表现

于2012财政年，益联控股有限公司（“益联”）及其附属公司（“益联集团”）的营业额达7亿2千200万令吉，比起上一个财政年所取得的7亿4千480万令吉营业额减少3.1%。

2012财政年的营业额较低，主要是因为2011年3月在日本发生的海啸和2011年10月在泰国发生的大水灾所造成的汽车行业供应链中断，以致影响益联集团汽车业业务的运营和营业额。泰国的大水灾也导致马泰边境游客流量减少，致使位于马来西亚半岛北部免税业务营业额下降。

虽然2012财政年的较低营业额影响了免税业务和汽车业业务的利润，但是益联集团2012财政年却取得1亿2千820万令吉的税后利润，明显高于上一个财政年的5千30万令吉税后利润。2012财政年较高的税后利润，主要来自于益联的两家全资子公司，即Blossom Time私人有限公司和Radiant Ranch私人有限公司于2011年5月出售土地后所取得的8千300万令吉一次性的净利润。

企业活动和展望

2012财政年是益联集团充满大事的一年。刚于2011年1月完成重组DFZ资本有限公司（“DFZ”）和Darul Metro私人有限公司（“DMSB”），通过Duty Free International Limited（“ DFI”）于新加坡交易所上市，益联集团的运营即需面对挑战和困难。于2011年3月发生在日本的自然灾难影响了汽车业业务，而于本财务年结束前发生在泰国的另一场自然灾难，同时候影响了免税业务和汽车业业务。

然而，通过员工们的辛勤工作和奉献，益联集团依然保持其免税业务和汽车业业务的市场地位，为2012财政年带来可观的营业额。同时，把握住机遇调整其房地产资产，也让本财政年取得更好的利润。

经过充满挑战的一年后，鉴于马泰边界的游客流量和汽车行业供应链逐渐地恢复，虽然面对着全球与区域经济衰弱的趋势，益联集团对2013财政年的业务展望保持谨慎乐观。而位于吉隆坡安邦路的益联大楼，在当地办公楼供应增加的情况下，凭着其具竞争性价格，继续取得良好的租用率。

益联集团于今年初启动一项重大的企业活动，涉及全资子公司益联科技私人有限公司（“益联科技”）以及DFI集团两家全资子公司DMSB和Kelana Megah私人有限公司（“KMSB”）。于2012年4月10日，DMSB 和KMSB与Pesaka Ikhlas (M) 私人有限公司（“Pesaka”）签署了附带条件买卖协议，出售DFI集团位于柔佛新山适都浪海滨免税区内的6块土地的法律及利益权，总值3亿2千5百万令吉及位于新山适都浪海滨的1块土地将拥有的租赁权，总值2千7百99万令吉。在同一天，益联科技也和Pesaka签署了附带条件的买卖协议，出售位于新山适都浪海滨的1块土地的法律及利益权，总值3千2百1万令吉。

Pesaka是成功时代广场私人有限公司的全资子公司，而成功时代广场私人有限公司则是于马来西亚证券交易所上市的成功资产有限公司Berjaya Assets Berhad的全资子公司。

上述的出售建议完成后，益联集团将继续活跃于新山免税区，将透过DFI集团的全资子公司Selasih Ekslusif私人有限公司租用新山免税区内的特定单位长达25年，在该区独家经营进口、供应和销售洋酒，烈酒，啤酒，巧克力，烟草产品，香水和化妆品。

上述的出售建议将增强益联集团的财务实力，赋予集团一个更强大稳固的平台，让益联可以继续开展业务。

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主席献词(继续)

库存股

于2012财政年，益联以内部资金回购1千股普通股，总代价4千令吉（含交易费）。截至2012年2月29日，益联持有1百64万9千649股库存股。

2012财政年之后，益联在马来西亚证券交易所出售1百64万9千600股库存股，总值6百60万令吉。余下的49股库存股于2012年5月11日已被吊销。出售和吊销库存股后，不再持有任何库存股。

致谢

我欢迎王穆享先生于2012年4月30日成为益联的董事经理。我相信凭藉王先生的丰富的知识和广泛的经验，将会带领益联集团取得更大的成就。

我谨此代表董事会向政府及其官员所给予的宝贵咨询和协助，致予最深切的谢意。

我要感谢所有股东，银行家，客户，供应商，生意伙伴，管理层及员工们所给予的支持。

而我，作为您的谦恭的仆人，承诺持续全力以赴为益联集团尽力。

谢谢。

Adam Sani Bin Abdullah董事主席2012年6月22日

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The Board of Directors (“Board”) of Atlan Holdings Bhd. recognises the importance of practising high standards of corporate governance throughout the Group as a fundamental part of discharging its responsibilities to protect and enhance shareholders’ value and the financial performance of the Group.

The following statements outline the main corporate governance practices of the Group which were in place throughout the financial year.

STATEMENT OF COMPLIANCE

Board of Directors

An effective Board leads and controls the Company and the Group. The Board has the overall responsibility for Corporate Governance, establishing goals, strategies and direction, reviewing the Group’s performance and critical business issues and ultimately the enhancement of long term shareholders’ value.

Board Responsibility

The responsibilities of the Board of the Company are as follows:-

i) Reviewing and adopting strategic plans for the Company which will enhance the future growth of the Company;ii) Overseeing the conduct of the Company’s businesses to evaluate whether the businesses are being properly

managed;iii) Identifying principal risks of the business and ensuring the implementation of appropriate systems to manage

these risks; andiv) Reviewing the adequacy and integrity of the Company’s internal control systems and management information

systems.

Board Balance

The Board currently has eight members, comprising the Non-Executive Chairman, Group Managing Director, an Executive Director, a Non-Executive Director and four Independent Non-Executive Directors.

There is a clear division of responsibility between the Non-Executive Chairman and Group Managing Director to ensure there is a balance of power and authority. The Chairman is primarily responsible for orderly conduct and working of the Board whilst the Group Managing Director is responsible for the day-to-day business operations and implementation of Board policies and decisions.

All major matters issues are referred to the Board for consideration and approval. The roles and contributions of Independent Directors also provide an element of objectivity and independent judgement to the Board.

The Board composition complies with the requirement of the Malaysian Code on Corporate Governance and paragraph 15.02 of the Listing Requirements of Bursa Malaysia Securities Berhad. The Board is satisfied that its present composition fairly reflects the interest of minority shareholders in the Company.

Board Meetings

The Board meets at least four (4) times a year at quarterly intervals. Additional meetings are convened as and when necessary. The Chairman is responsible for setting the agenda for Board meetings in consultation with the Executive Directors. Any Board member may recommend the inclusion of items into the agenda.

Statement on Corporate Governance

15

For the financial year ended 29 February 2012, the Board held nine (9) meetings. The attendance record of each Director during their tenure of office in the financial year then ended is as follows:-

Directors Attendance

1. Dato’ Sri Adam Sani Bin Abdullah 9/92. Tengku Abdul Rahman Ibni Sultan Haji Ahmad Shah Al-Mustain Billah, DK II, SSAP 7/93. Dato’ Shagul Hamid Bin K.R. Williams @ Abdullah 9/94. Jeneral Dato’ Sri Abdullah Bin Ahmad @ Dollah Bin Amad (B) 9/95. Dato’ Woo Hon Kong 9/96. Mohd Sharif Bin Hj Yusof 9/97. Ong Bok Siong 9/98. Lee Sze Siang 9/9

Supply of information

All directors have full and timely access to information through the Board papers distributed in a timely manner prior to the Board meetings. The Board papers provide, among others, periodic financial information, annual budget, operational and corporate issues, investment proposals and management proposals that require Board’s approval. Senior management staff may be invited to attend Board meetings to provide the Board detailed explanations and clarifications on certain matters that are tabled by them to the Board.

All directors have access to all information within the Company, services and advice of the Company Secretaries and external professional advice at the Company’s expense, if necessary.

Appointment and Re-election of Directors

In accordance with the Articles of Association of the Company, one-third of the directors shall retire from office at every annual general meeting but shall be eligible for re-election. Directors appointed during the year by the Board shall hold office until the next annual general meeting and shall then be eligible for re-election.

A retiring director is eligible for re-election. The election of each director is voted separately. To assist shareholders in their decision, sufficient information such as personal profile, meeting attendance and the shareholdings of each Director standing for re-election, are furnished in the Annual Report.

Pursuant to Section 129(2) of the Companies Act, 1965, a Director who is over the age of seventy (70) years shall retire at every annual general meeting and shall be eligible for re-appointment to hold office until the next annual general meeting.

Directors’ Training

The Directors are mindful that they should receive appropriate continuous training to further enhance their skills and knowledge. Accordingly, the Company organises trainings at least once every two (2) years for the Board to ensure they are kept up-to-date on relevant developments.

Some of the seminars and briefings attended by the directors during the financial year to broaden their perspectives and to keep abreast with the changes on the guidelines issued by the relevant authorities as well as the latest developments in the market place were as follows:-

• LawGoverningDirectorsInaNutshell:MalaysiaCompaniesAct1965(Act125)• DischargingtheAuditCommittee&InternalAuditFunctioninCompliancewithRiskManagementBestPractices• 2012BudgetProposalsTaxChangesandItsImpactonBusiness

Statement on Corporate Governance (cont’d)

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Board Committees

The Board has appointed other Board Committees, which operate within clearly defined terms of reference. Standing committees of the Board include the Audit Committee, the Nomination Committee and Remuneration Committee.

(A) Audit Committee The Audit Committee’s role and functions are set out on pages 21 to 24 of this Annual Report.

(B) Nomination Committee

The Nomination Committee of the Company comprises exclusively non-executive directors, a majority of whom are independent directors. Its composition is as follows:-

Position Name Directorship

Chairman Dato’ Sri Adam Sani Bin Abdullah Chairman/Non-Executive Director

Member Tengku Abdul Rahman Ibni Sultan Haji Independent Non-Executive Director Ahmad Shah Al-Mustain Billah, DK II, SSAP

Member Dato’ Shagul Hamid Bin K.R. Williams @ Abdullah Independent Non-Executive Director

The duties and functions of the Nomination Committee are as follows:-

• IdentifyandrecommendnewnomineesfortheBoardandBoardCommittees;• AssesstheperformanceofthedirectorsoftheCompanyonanon-goingbasis;and• AnnualreviewoftheBoardstructure,sizeandcomposition.

The appointment of new directors is the responsibility of the full Board after consideration of the recommendation by the Nomination Committee.

In making this recommendation, the Committee will consider the required mix of skills and experience and other qualities, including core competencies which directors of the Company should bring to the Board.

(C) Remuneration Committee

The Remuneration Committee, comprising mainly non-executive directors, is made up of the following directors:-


Chairman Dato’ Sri Adam Sani Bin Abdullah Chairman/Non-Executive Director

Member Dato’ Shagul Hamid Bin K.R. Williams @ Abdullah Independent Non-Executive Director

Member Jeneral Dato’ Sri Abdullah Bin Ahmad @ Dollah Independent Non-Executive Director Bin Amad (B)

The 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.

Directors’ Remuneration

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. The Remuneration Committee proposes the remuneration of executive directors to the Board. The remuneration of non-executive directors is determined by the Board.

Directors’ fees payable to non-executive directors are subject to shareholders’ approval at the Annual General Meeting.


17

Directors’ remuneration for services rendered to the Group for financial year ended 29 February 2012 is as follows:-

i. Directors’ Remuneration

AllowancesIn RM’000 and Fees Salaries Total

Executive Directors- Company – – –- Subsidiaries – 1,579 1,579

Non-Executive Directors- Company 150 – 150- Subsidiaries 72 – 72

Total 222 1,579 1,801

ii. Range of Remuneration

Executive Directors Non-Executive Directors

RM50,000 and below – 6 RM750,001 to RM800,000 1 – RM800,001 to RM850,000 1 –

SHAREHOLDERS

Communication with Shareholders

The Company continues to recognise the importance of transparency and accountability to its shareholders and investors. The Board always ensures that the shareholders are informed of the financial performance and major corporate activities of the Company. Such information is communicated to shareholders and investors through various disclosures and announcements to Bursa Malaysia Securities Berhad, including the quarterly financial results, annual reports and where appropriate, circulars and press releases.

Apart from the mandatory announcements through the Bursa Malaysia Securities Berhad, the Company also maintains a website www.atlan.com.my to which shareholders and investors can have access to information on the operations and business activities of the Group.

Investor relations activities such as meetings with fund managers and analysts and interviews by the press are held at appropriate time to explain the Group’s strategy, performance and major developments.

Annual General Meeting

The Annual General Meeting is the principal forum for dialogue with shareholders. At such Annual General Meeting, the Board encourages shareholders to participate in the questions and answers session. The members of the Board are available to respond to questions from shareholders.

Any item of special business included in the notice of meeting will be accompanied by a full explanation of the effects of the resolution to facilitate full understanding and evaluation of the issues involved.

Extraordinary General Meeting

Apart from the Annual General Meeting, the Board will convene Extraordinary General Meetings on matters that require shareholders approval. Appropriate notices of meeting as well as circulars will be issued and dispatched to shareholders for their evaluation and consideration.


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ACCOUNTABILITY AND AUDIT

Financial Reporting

The Board aims to present a balanced, clear and meaningful assessment of the Group’s financial positions and prospects in all their reports to the shareholders and regulatory authorities.

The Audit Committee assists the Board to ensure that all annual and quarterly financial reports are prepared in accordance with the applicable approved accounting standards in Malaysia and the provisions of the Companies Act, 1965.

Statement of Directors’ Responsibility in respect of the Audited Financial Statements

The directors are required by the Companies Act, 1965 to prepare financial statements which give a true and fair view of the state of affairs of the Group and of the Company at the end of each financial year and of their results and cash flows for the financial year then ended.

In preparing the financial statements, the directors have:-

• Adoptedappropriateaccountingpoliciesandappliedthemconsistently;• Madejudgementsandestimatesthatarereasonable;• Ensuredthatapplicableaccountingstandardshavebeencompliedwith;and• Appliedthegoingconcernbasis.

The directors are responsible for ensuring that the Company and the Group keep proper accounting records, which disclose with reasonable accuracy on the financial position of the Company and of the Group, and which enable them to ensure that the financial statements comply with the provisions of the Companies Act, 1965.

The directors are also responsible for taking reasonable steps to safeguard the assets of the Company and to prevent and detect other irregularities.

Internal Controls

It is responsibility of the Board to maintain sound systems of internal controls to safeguard shareholders investment.

As the systems of internal controls are designed to mitigate rather than eliminate the likelihood of errors or fraud, these systems can only provide a reasonable assurance against material misstatement or loss.

In order to maintain sound systems of internal controls, the Board has established an internal audit function, which is completely independent from all operations to monitor and review the effectiveness of the internal controls within the organisation.

Relationship with external auditors

The Group’s independent external auditors play an important role in enhancing the reliability of the Group’s financial statements and giving assurance of that reliability to the users of these financial statements.

The role of the Audit Committee in relation to the external auditors is described in the Audit Committee Report of this Annual Report. The Group has always maintained a transparent relationship with its auditors in seeking professional advice and ensuring compliance with applicable approved accounting standards in Malaysia.


19

Additional Compliance Information

The information set out below is disclosed in compliance with the Listing Requirements of Bursa Malaysia Securities Berhad:-

1. Utilisation of Proceeds

During the financial year ended 29 February 2012, the Company did not raise any funds through any corporate proposal/shareholders’ mandate under Section 132D of the Companies Act, 1965.

2. Share Buy-Back

During the financial year ended 29 February 2012, the Company repurchased 1,000 of its issued ordinary shares of RM1.00 each from the open market.

However, the shareholders’ mandate for the Share Buy-Back had expired at the conclusion of the last Annual General Meeting held on 28 July 2011. The Company did not purchase any shares from the open market since then.

The details of the shares bought back by the Company are as follows:-

No. of shares purchased Purchase Price Per Share and retained Lowest Highest Average TotalMonth as treasury share Price Price Price* Consideration* RM RM RM RM

May 2011 1,000 3.35 3.35 3.35 3,395.00

1,000 3,395.00

* Inclusive of transaction cost

The information on the shares repurchased by the Company amounting to 1,000 shares during the financial year is presented under Note 28 to the Financial Statements.

As at 29 February 2012, the numbers of treasury shares held by the Company were 1,649,649 after taking into account of the aforesaid shares bought back by the Company, and no treasury shares were resold or cancelled during the financial year.

3. Options or Convertible Securities

No options, warrant or convertible securities were exercised during the financial year.

4. Depository Receipt Programme

The Company did not sponsor any depository receipt programme during the year.

5. Sanctions and/or Penalties

There were no sanctions or penalties imposed on the Company and its subsidiaries, directors or management by the relevant regulatory bodies during the financial year.

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6. Non-Audit Fees

Non-audit fees paid to external auditors by the Company and by the Group for the financial year ended 29 February 2012 amounted to RM120,000 and RM212,000 respectively.

7. Variation in Results

There is no material variance between the audited results and the unaudited results previously announced.

There was no profit forecast announced during the financial year.

8. Profit Guarantee

There was no profit guarantee given by the Company during the financial year.

9. Material Contracts Involving Directors’ and Major Shareholders’ Interests

There were no material contracts entered into by the Company and its subsidiaries involving directors’ and major shareholders’ interests, either still subsisting at the end of the financial year or entered into since the previous financial year end.

10. Recurrent related party transactions of a revenue nature

There were no recurrent related party transactions of a revenue nature entered into during the financial year ended 29 February 2012.

Additional Compliance Information (cont’d)

21

Audit Committee Report

The Audit Committee comprises the following members:-


Chairman Mohd Sharif Bin Hj Yusof Independent Non-Executive Director

Member Dato’ Shagul Hamid Bin K.R Williams @ Abdullah Independent Non-Executive Director

Member Jeneral Dato’ Sri Abdullah Bin Ahmad @ Dollah Independent Non-Executive Director Bin Amad (B)

ATTENDANCE

The Audit Committee met five (5) times during the financial year ended 29 February 2012. Details of the attendance of the Committee members holding office during the financial year are as follows:-

Members Attendance

Mohd Sharif Bin Hj Yusof 5/5Dato’ Shagul Hamid Bin K.R. Williams @ Abdullah 5/5Jeneral Dato’ Sri Abdullah Bin Ahmad @ Dollah Bin Amad (B) 5/5

SUMMARY OF THE TERMS OF REFERENCE OF THE AUDIT COMMITTEE

1. Primary Purposes

1.1 Assist the Board in discharging its statutory duties and responsibilities relating to accounting and reporting practices of the Company and each of its subsidiaries.

1.2 Evaluate the quality of the audits conducted by the internal and external auditors.

1.3 Provide reasonable assurance that the financial information presented by management is relevant, reliable and timely.

1.4 Oversee compliance with laws and regulation and observance of a proper code of conduct.

1.5 Determine the adequacy of the Company’s control environment.

2. Composition

2.1 The Committee shall be appointed by the Board from amongst their number and shall be no fewer than three (3) non-executive members, the majority of whom shall be independent directors as defined in the Listing Requirements of Bursa Malaysia Securities Berhad (“Listing Requirements”).

2.2 The members of the Committee must include at least one (1) member of the Audit Committee who:-

(i) is a member of Malaysian Institute of Accountants; or(ii) must have at least 3 years’ working experience and:-

a) passed the examinations specified in Part I of the 1st Schedule of the Accountants Act, 1967; orb) a member of one of the associations of accountants specified in Part II of the 1st Schedule of

the Accountants Act, 1967; or(iii) fulfils such other requirements as prescribed or approved by Bursa Securities.

2.3 The Board must ensure that no alternate director is appointed as a member of the Committee.

2.4 The members of the Committee shall elect a Chairman from amongst their number who shall be an independent director.

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3. Authority

The Committee shall in accordance with the procedure determined by the Board and at the cost of the Company:-

(i) have authority to investigate any matter within its terms of reference;(ii) have the resources which are required to perform its duties;(iii) have full and unrestricted access to any information pertaining to the Company and its subsidiaries;(iv) have direct communication channels with the external auditors and person(s) carrying out the internal

audit function or activity;(v) be able to obtain independent professional or other advice and to secure the attendance of outsiders with

relevant experience and expertise if it considers necessary; and(vi) be able to convene meeting with the external and internal auditors or both and exclude the directors and

employees, whenever deemed necessary.

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 Committee shall promptly report such matter to Bursa Malaysia Securities Berhad.

4. Functions and Duties

The Board must ensure the Committee discharges the following functions, amongst others:-

4.1 To consider the appointment of the external auditors, the audit fee and any questions of resignation or dismissal and whether there is any reason (supported by grounds) to believe that the external auditors are not suitable for re-appointment.

4.2 To review with the external auditors:-• theirauditplans;• itsevaluationofthesystemsofinternalcontrols;• itsauditreports;• theassistancegivenbytheemployeesoftheCompanyanditssubsidiariestotheexternalauditors;and• theexternalauditors’managementletterandthemanagement’sresponsethereto.

4.3 To recommend the nomination of a person or persons as the external auditors.

4.4 To do the following in relation to the internal audit functions:-

• ensuretheinternalauditfunctionisindependentoftheactivitiesitauditsandtheheadofinternalaudit reports directly to the Audit Committee. The head of internal audit will be responsible for the regular review and/or appraisal of the effectiveness of the risk management, internal control and governance processes within the Company and its subsidiaries;

• reviewtheadequacyofthescope,functionscompetencyandresourcesoftheinternalauditfunctionsand that it has all the necessary authority to carry out its work;

• reviewtheinternalauditprogrammeandtheresultsoftheinternalauditprocessorinvestigationundertaken;

• toconsiderthemajorfindingsandwhetherornotappropriateactionistakenontherecommendationsof the internal audit function and management’s response thereto;

• reviewanyappraisalorassessmentoftheperformanceofmembersoftheinternalauditfunction;• toconsidertheappointmentorresignationofseniorstaffmembersoftheinternalauditfunction,take

cognisance of resignation of internal audit staff members (for in-house internal audit function) or the internal audit service provider (for out-sourced internal audit function) and provide the resigning staff member or the internal audit service provider an opportunity to submit his/her reasons for resigning, if necessary; and

• tosupport,asdeemnecessary,theinternalauditactivities.

Audit Committee Report (cont’d)

23

4.5 To review the quarterly results and year end financial statements, prior to the approval by the Board of Directors, focusing particularly on:-

• anychangesinorimplementationofmajoraccountingpoliciesandpractices;• significantadjustmentsarisingfromtheauditandanyothersignificantandunusualevents;• compliancewithaccountingstandardsandotherlegalrequirements;and• anyrelatedpartytransactionandconflictofinterestsituationthatmayarisewithintheCompany

or the Group including any transaction, procedure or course of conduct that raises questions of the management’s integrity.

4.6 To consider and examine any other matters as defined by the Board of Directors from time to time.

5. Meetings

5.1 To form a quorum in respect of a meeting of the Committee, the majority of members present must be independent directors.

5.2 The Committee shall meet at least four (4) times a year.

5.3 The external auditors may request a meeting if they consider that one is necessary and the Chairman of the Committee shall convene a meeting of the Committee to consider any matters the external auditors believe should be brought to the attention of the Directors or shareholders.

5.4 The external auditors have the right to appear and be heard at any meeting of the Committee.

5.5 The Committee may invite any Board member of any member of the senior management or any relevant employee within the Company or the Group whom the Committee thinks fit to attend its meetings to assist in resolving and clarifying matters raised in audit reports.

5.6 The internal auditors shall be in attendance at meetings of the Committee to present and discuss the audit reports of findings and the recommendations relating thereto and to follow up on decisions made at these meetings.

6. Secretary

6.1 The Company Secretary shall be the Secretary of Audit Committee.

6.2 The Secretary shall cause minutes to be duly entered in the books for the purpose of all resolutions and proceeding of all meetings of the Audit Committee. Such minutes shall be signed by the Chairman of the meeting at which the proceedings were held or by the Chairman of the next succeeding meeting.

6.3 The Secretary shall circulate the minutes of meeting of the Committee to all members of the Board.

SUMMARY OF ACTIVITIES OF THE AUDIT COMMITTEE

The activities of the Audit Committee for the financial year are as follows:-

• reviewanddiscussthere-appointmentoftheexternalauditorsoftheCompanybeforetablingtotheshareholdersfor approval at the Annual General Meeting.

• reviewanddiscusstheexternalauditors’natureandscopeoftheauditplan,systemofinternalcontrolreview,audit report and any significant audit findings encountered;

• reviewanddiscussthebudgetfortheyear;


24


• reviewthequarterlyandannualfinancialstatementspriortorecommendingthemtotheBoardforapprovalandensure that it is prepared in accordance with the applicable approved accounting standards and the provisions of the Companies Act, 1965;

• reviewanyrelatedpartytransactionsthatmayarisewithintheGrouportheCompany;

• reviewtheadequacyofthescope,functionsandresourcesoftheinternalauditfunctionandtheinternalauditplan; and

• reviewthescopeoftheinternalauditprogramme,theinternalauditfindings,recommendationsandcorrectiveactions taken.

SUMMARY OF ACTIVITIES OF THE INTERNAL AUDIT FUNCTION

The internal audit function is independent of the auditable areas in the organisation and reports to the Audit Committee. The responsibilities include reviewing the adequacy of the system of internal controls and evaluating the various financial and operational risks faced by the organisation.

The internal audit activities are specified in the annual audit plan, which is submitted to the Audit Committee for approval. Internal audit reports with findings and recommendations are forwarded to the Audit Committee for their review.

For the financial year under review, the total costs incurred by the Group for maintaining the internal audit functions are RM1,120,000.


25

Statement on Internal Control

Preamble

Pursuant to paragraph 15.26(b) of the Bursa Malaysia Securities Berhad’s Listing Requirements, the Board is required to include in its Annual Report a statement on the state of internal control of the Group. In making this statement on Internal Control, it is essential to address the Principles and Best Practices in the Malaysian Code on Corporate Governance, which relate to internal control.

Responsibility

The Board acknowledges its stewardship responsibility for maintaining a sound system of internal control and for reviewing its adequacy and integrity to safeguard shareholders’ investment and the Group’s assets.

However, it should be noted that such system is designed to manage rather than eliminate the risk of failure to achieve business objectives and can only provide reasonable and not absolute assurance against material misstatement loss and fraud. For the purpose of this statement, the associated company is not dealt with as part of the Group.

Internal Control Systems

The embedded control system is designed to facilitate achievement of the Group’s business objectives. It comprises the underlying control environment, control process, communication and monitoring systems.

The organisational structure has well-defined responsibility, delegation of authority, segregation of duties and information flow. Committees made up predominantly of non-executive directors, such as Audit, Nomination and Remuneration Committees, provide the essential support to the Board. The Audit Committee convenes regularly to meet their strategic business agenda, thus ensuring that the Board properly apprised and maintains effective supervision over the entire operations.

Well-documented Group-wide policies, procedures and standards have been established, periodically reviewed and updated in accordance with changes in the operating environment.

In addition, the Group has in place comprehensive budgeting process for all operating units with periodical monitoring of performance so that major variances are followed-up and management action taken.

The functional limits of authority for revenue and capital expenditure for all operating units serve to facilitate the approval process whilst keeping potential exposure in check.

Detailed justification and approval process for major projects and acquisitions are imposed to ensure congruence with Company’s strategic objectives.

The Group’s computerised information systems are streamlined to ensure compliance with hardware and software regulations and guidelines for system integrity, effectiveness and efficiency.

Independent appraisals by internal and external auditors ensure ongoing compliance with policies, procedures, standards and legislations whilst assessing the effectiveness of the Group’s systems of financial, compliance and operational controls.

Risk Management

Besides primary ownership over effectiveness of the Group’s internal control system, the Board recognises its responsibility over the principal risks of various aspects of the Group’s business. For long-term viability of the Group, it is crucial to achieve a critical balance between risks incurred and potential returns.

To facilitate risk analysis, key risks and control affecting the Group are identified, prioritised, evaluated and measured for the impact on the Group’s business objectives. The various risk profiles will then be regularly consolidated, reported and presented to the Audit Committee for its review.

26


Internal Audit Function

An Internal Audit function supports the Audit Committee, and by extension, the Board, by providing reasonable independent assurance on the effectiveness of the Group’s systems of internal control.

In particular, Internal Audit appraises and contributes towards improving the Group’s risk management and control systems and reports to the Audit Committee on a quarterly basis.

The internal audit work plan, which reflects the risk profile of the Group’s major business sectors is routinely reviewed and approved by the Audit Committee. The scope of the Internal Audit function covers the audit of all business units and operations.

Internal Control Issues

Management maintains an ongoing commitment to strengthen the Group’s control environment and processes.

The external auditors have reviewed the Statement on Internal Control as required by paragraph 15.23 of the Listing Requirements of Bursa Malaysia Securities Berhad. Their review was performed in accordance with Recommended Practice Guide 5 issued by the Malaysian Institute of Accountants.

Statement on Internal Control (cont’d)

27

Corporate Social Responsibility

Corporate Social Responsibility (“CSR”) is often perceived or described as one or more of the following: corporate, citizenship, ethical and transparent business values, environmental sustainability or corporate philanthropy. Increasingly, CSR is seen as the combination of all of these and with clear emphasis on the word “responsibility”.

The Board acknowledges the importance of CSR and views CSR as an extension of the Group’s efforts in fostering a strong corporate governance culture. Working towards CSR enables the Group to co-exist with the community and the environment while building a sound business. CSR also enables the Group to be recognised by the community as a responsible corporate citizen that helps to make sustainable growth a reality.

Community

The Group plays its role as socially responsible corporate citizen in the community through various activities held with the aim of caring for wellbeing of the society at large. The Group continues to support education and welfare in the local communities.

During the year, the Group had contributed donations to various worthy societies and institutions through the non-profit organisation, Yayasan Harmoni, whereby contributions were made to welfare homes for single mothers, orphans and the less fortunate. Amongst others, the Group contributed to Kasih Foundation for the purchase of medical equipment and other related supplies. The Group also contributed to the relief efforts for the floods which affected certain community in the country.

The Group, had through its subsidiary, Kelana Megah Sdn. Bhd. played host to the Miss Tourism International 2011 whereby through this event, donations had been made to a few charity homes and school for special needs children and the disabled through Yayasan Harmoni.

The Group believes that education is a perquisite for harmonious functioning of any society. Accordingly, the Group has contributed through Yayasan Harmoni, to schools for the welfare of less fortunate students as well as building funds for school facilities. The Group also continued to contribute to Sumbangan Bantuan Persekolahan, an internally set up Group Fund, to assist qualified employees, who have school-going children, with expenses for the new school year.

Workplace

The Group is committed in its social responsibilities at the workplace via compliance and respect to Human Rights which includes employment of staff under fair and equitable terms as well as offering equal opportunity for career advancement based on performance. Continuous learning and development programmes were carried out throughout the year to equip the staff with relevant skills, knowledge and experience which would enhance the individual staff’s competency and eventually add value to the Group. Upward mobility of staff is encouraged and staff welfare is closely monitored to avoid any violation of Labour or Human Rights.

In addition, health and safety awareness programs and sports activities were held to encourage employees to lead a health lifestyle. The Group also organised annual dinners and festive celebrations for its employees.

Environment

During the year the Group, in particular The Zon Johor Bahru, promoted clean and green environment by organising event, such as “Gotong Royong” wherein staffs from all rank and file participated in the event, as well as launched a Go Green Campaign, and participated in the Earth Hour. The Group also undertook several initiatives preserving the environment including upgrading its information technology infrastructure on its move to paperless environment, reducing the usage of papers via electronic communication and recycling paper.

28


Marketplace

The Group ensures that its operations are in line with the best practices guidelines set in Malaysian Code on Corporate Governance. All activities are conducted at arms length and do not favour any single party.

Conclusion

The Group will continue to support and encourage all our employees and businesses to find ways to help their communities. The Group’s initiatives in supporting CSR are an ongoing commitment towards creation of a competitive nation, yet a moral, ethical, caring and economically just society.

Corporate Social Responsibility (cont’d)

Financial Statements

Directors’ Report 30

Statement by Directors 34

Statutory Declaration 34

Independent Auditors’ Report 35

Income Statements 37

Statements of Comprehensive Income 38

Statements of Financial Position 39

Statements of Changes In Equity 42

Statements of Cash Flows 45

Notes to the Financial Statements 48

Supplementary Information 133


30

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 29 February 2012.

PRINCIPAL ACTIVITIES

The principal activities of the Company are investment holding and the provision of management, financial, technical and other ancillary services.

The principal activities of the subsidiaries are set out in Note 19 to the financial statements.

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

RESULTS

Group Company RM’000 RM’000 Profit net of tax 128,232 49,165

Profit attributable to: Owners of the parent 114,813 49,165Non-controlling interests 13,419 –

128,232 49,165

There were no material transfers to or from reserves or provisions during the financial year, other than as disclosed in the statement of changes in equity and notes to 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 the gain on disposal of land held for property development in respect of the Group as disclosed in Note 5 to the financial statements.

DIVIDEND

The amounts of dividends paid by the Company since 28 February 2011 were as follows:

RM’000In respect of the financial year ended 28 February 2011:

Fourth interim dividend (single-tier) of 5%, on 252,002,000 ordinary shares, declared on 14 March 2011 and paid on 13 April 2011 12,600 In respect of the financial year ended 29 February 2012:

First interim dividend (single-tier) of 4%, on 252,001,000 ordinary shares, declared on 13 October 2011 and paid on 22 November 2011 10,080

Special interim dividend (single-tier) of 10%, on 252,001,000 ordinary shares, declared on 9 February 2012 and paid on 23 March 2012 25,200

The directors do not recommend the payment of any final dividend in respect of the financial year ended 29 February 2012.

Directors’ Report

31

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’ Sri Adam Sani Bin AbdullahTengku Abdul Rahman Ibni Sultan Haji Ahmad Shah Al-Mustain Billah, DK II, SSAPDato’ Shagul Hamid Bin K.R. Williams @ AbdullahJeneral Dato’ Sri Abdullah Bin Ahmad @ Dollah Bin Amad (B)Dato’ Woo Hon KongMohd Sharif Bin Hj YusofOng Bok Siong Lee Sze Siang

DIRECTORS’ BENEFITS

Neither at the end of the financial year, nor at any time during that year, did there subsist any arrangement to which the Company was a party, whereby the directors might acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.

Since the end of the previous financial year, no director has received or become entitled to receive a benefit (other than benefits included in the aggregate amount of emoluments received or due and receivable by the directors or the fixed salary of a full-time employee of the Company as shown in Note 7 to the financial statements) by reason of a contract made by the Company or a related corporation with any director or with a firm of which he is a member, or with a company in which he has a substantial financial interest except as disclosed in Note 39 to the financial statements.

DIRECTORS’ INTERESTS

According to the register of directors’ shareholdings, the interests of directors in office at the end of the financial year in shares in the Company and its related corporations during the financial year were as follows:

Number of ordinary shares of RM1 each 1 March 29 February 2011 Acquired Sold 2012The Company Direct interestOrdinary shares of the Company

Dato’ Sri Adam Sani Bin Abdullah 1,764,061 – 1,700,000 64,061Dato’ Woo Hon Kong 11,036,135 – 3,000,000 8,036,135

Deemed interestOrdinary shares of the Company

Dato’ Sri Adam Sani Bin Abdullah* 78,520,340 48,734,813 – 127,255,153Dato’ Woo Hon Kong 44,034,813 – 44,034,813 –

* Denotes deemed interest through shares held in ultimate holding company, Distinct Continent Sdn. Bhd., by virtue of Section 6A of the Companies Act, 1965.

Dato’ Sri Adam Sani Bin Abdullah by virtue of his interest in shares in Distinct Continent Sdn. Bhd. is deemed interested in the shares in the Company and its related corporations to the extent Distinct Continent Sdn. Bhd. has an interest.

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 during the financial year.

Directors’ Report (cont’d)


32

TREASURY SHARES

During the financial year, the Company repurchased 1,000 of its issued ordinary shares from the open market at an average price of RM3.35 per share. The total consideration paid for the repurchase including transaction costs was RM4,000. The shares repurchased are being held as treasury shares in accordance with Section 67A of the Companies Act, 1965.

As at 29 February 2012, the Company held as treasury shares a total of 1,649,649 of its 253,650,000 issued ordinary shares. Such treasury shares are held at a carrying amount of RM4,815,000 and further relevant details are disclosed in Note 28 to the financial statements.

OTHER STATUTORY INFORMATION

(a) Before the income statements, 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 allowance for impairment and satisfied themselves that all known bad debts had been written off and that adequate allowance had been made for impairment; 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.

(b) 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 or the amount of the allowance for impairment in the financial statements of the Group and 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) At the date of this report, there does not exist:

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

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

(f) In the opinion of the directors:

(i) 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.


33

SIGNIFICANT AND SUBSEqUENT EVENTS

Details of significant and subsequent events are disclosed in Note 46 to the financial statements.

AUDITORS

The auditors, Ernst & Young, have expressed their willingness to continue in office.

Signed on behalf of the Board in accordance with a resolution of the directors dated 15 June 2012.

Ong Bok Siong Lee Sze Siang



34

We, Ong Bok Siong and Lee Sze Siang, being two of the directors of Atlan Holdings Bhd., do hereby state that, in the opinion of the directors, the accompanying financial statements set out on pages 37 to 132 are drawn up in accordance with Financial Reporting Standards and 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 29 February 2012 and of their financial performance and cash flows for the year then ended.

The information set out in Note 47 on page 133 to the financial statements 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 15 June 2012.

Ong Bok Siong Lee Sze Siang

Statutory DeclarationPursuant to Section 169(16) of the Companies Act, 1965

I, Lee Sze Siang, being the director primarily responsible for the financial management of Atlan Holdings Bhd., do solemnly and sincerely declare that the accompanying financial statements set out on pages 37 to 133 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 Lee Sze Siangat Kuala Lumpur in the Federal Territoryon 15 June 2012. Lee Sze Siang

Before me,

Mohan A. S. ManiamNo. W521Commissioner for Oaths

Statement by DirectorsPursuant to Section 169(15) of the Companies Act, 1965

35

REPORT ON THE FINANCIAL STATEMENTS

We have audited the financial statements of Atlan Holdings Bhd, which comprise the statements of financial position as at 29 February 2012 of the Group and of the Company, and income statement, the statements of comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the Company for the year then ended, and a summary of significant accounting policies and other explanatory notes, as set out on pages 37 to 132.

Directors’ responsibility for the financial statements

The directors of the Company are responsible for the preparation of financial statements that give a true and fair view in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia, and for such internal control as the directors determine are necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditors’ responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on our judgement, including the assessment of risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the entity’s preparation of financial statements that give a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and 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 29 February 2012 and of their financial performance and cash flows for the year then ended.

REPORT ON OTHER LEGAL AND REGULATORY REqUIREMENTS

In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following:

(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act.

(b) We have considered the financial statements and the auditors’ reports of all the subsidiaries of which we have not acted as auditors, which are indicated in Note 19 to the financial statements, being financial statements that have been included in the consolidated financial statements.

(c) 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.

Independent Auditors’ Reportto the shareholders of Atlan Holdings Bhd.


36

OTHER REPORTING RESPONSIBILITIES

The supplementary information set out in Note 47 on page 133 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’s Main Market 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.

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.

Ernst & Young Lim Foo Chew AF: 0039 No. 1748/01/14(J)Chartered Accountants Chartered Accountant

Penang, Malaysia15 June 2012

Independent Auditors’ Report (cont’d)to the shareholders of Atlan Holdings Bhd.

37

Income StatementsFor the year ended 29 February 2012

Group Company Note 2012 2011 2012 2011 Restated RM’000 RM’000 RM’000 RM’000

Revenue 4 722,040 744,789 85,407 48,555 Other income 5 122,317 74,614 64 581,003 Raw materials and consumables used (491,922) (495,885) – – Changes in finished goods 22,656 3,096 – – Property development costs (2,790) (155) – – Employee benefits expense 6 (67,615) (69,085) (157) (367)Depreciation and amortisation (23,484) (24,280) (8) (13)Other operating expenses 8 (106,449) (137,328) (24,185) (51,898)

Operating profit 174,753 95,766 61,121 577,280 Share of results of an associate 22 (28) – – Finance costs 9 (16,477) (22,038) (10,913) (15,513)

Profit before tax 158,298 73,700 50,208 561,767 Income tax expense 10 (30,066) (23,435) (1,043) (8,113)

Profit net of tax 128,232 50,265 49,165 553,654

Profit attributable to:Owners of the parent 114,813 30,182 49,165 553,654 Non-controlling interests 13,419 20,083 – – 128,232 50,265 49,165 553,654

Basic earnings per share attributable to owners of the parent (sen per share) 11 45.56 12.11

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


38

Group Company 2012 2011 2012 2011 Restated RM’000 RM’000 RM’000 RM’000

Profit net of tax 128,232 50,265 49,165 553,654 Foreign currency translation 5 10 – –

Total comprehensive income for the year 128,237 50,275 49,165 553,654

Total comprehensive income attributable to:Owners of the parent 114,818 30,192 49,165 553,654 Non-controlling interests 13,419 20,083 – –

128,237 50,275 49,165 553,654

Statements of Comprehensive IncomeFor the year ended 29 February 2012


39

Group Note 2012 2011 2010 Restated Restated RM’000 RM’000 RM’000 Assets

Non-current assetsProperty, plant and equipment 13 326,690 393,661 399,738Land held for property development 14 305 42,952 77,711Investment properties 15 65,118 68,929 71,648Land use rights 16 20,869 21,371 21,332Biological assets 17 2,759 2,617 2,168Goodwill 18 28,462 28,462 28,462Investment in associate 20 459 437 465Other investments 21 150 150 162Other receivables 22 63 253 473Deferred tax assets 23 6,646 6,353 6,708 451,521 565,185 608,867

Current assets Inventories 24 192,410 131,173 126,901Trade and other receivables 22 51,618 52,004 53,478Prepayments 6,266 4,299 8,000Tax recoverable 5,141 3,681 4,720Marketable securities 25 1,425 3,987 3,840Cash and bank balances 26 118,256 136,805 115,082

375,116 331,949 312,021Assets classified as held for sale 27 67,201 42,198 – 442,317 374,147 312,021

Total assets 893,838 939,332 920,888

Statements of Financial PositionAs at 29 February 2012


40

Group Note 2012 2011 2010 Restated Restated RM’000 RM’000 RM’000

Equity and liabilities

Current liabilitiesTrade and other payables 35 130,184 125,537 141,006Derivative liabilities 36 95 8 –Provisions 37 17,101 17,539 46,391Employee benefits 32 164 152 162Dividends payable 26,483 – 16,619Tax payable 4,075 3,668 3,433Borrowings 33 103,178 126,161 63,681

281,280 273,065 271,292

Net current assets 161,037 101,082 40,729 Non-current liabilitiesEmployee benefits 32 3,238 2,988 2,674Deferred tax liabilities 23 8,956 9,150 8,151Borrowings 33 119,637 242,458 242,618

131,831 254,596 253,443

Total liabilities 413,111 527,661 524,735

Net assets 480,727 411,671 396,153

Equity attributable to owners of the parentShare capital 28 253,650 253,650 253,650Share premium 28 101,059 101,059 136,047Treasury shares 28 (4,815) (4,811) (35,230)Currency translation reserve (217) (222) (232)Other reserve 30 (22,580) (19,944) (7,782)Retained earnings/(Accumulated losses) 55,341 (11,592) (12,282)

382,438 318,140 334,171Non-controlling interests 98,289 93,531 61,982

Total equity 480,727 411,671 396,153

Total equity and liabilities 893,838 939,332 920,888

Statements of Financial Position (cont’d)As at 29 February 2012

41

Statements of Financial Position (cont’d)As at 29 February 2012

Company Note 2012 2011 Restated RM’000 RM’000Assets

Non-current assetsProperty, plant and equipment 13 6 14 Investment in subsidiaries 19 1,212,066 1,216,637 Investment in associate 20 437 437 1,212,509 1,217,088

Current assets Other receivables 22 168,775 274,820 Prepayments 64 64Tax recoverable 2,481 2,451 Dividends receivable 5,430 –Marketable securities 25 1,408 3,970 Cash and bank balances 26 39,148 6,683 217,306 287,988

Total assets 1,429,815 1,505,076

Equity and liabilities

Current liabilitiesOther payables 35 431,221 433,394 Provisions 37 4,000 4,000 Dividends payable 25,200 –Tax payable 436 –Borrowings 33 5 8,005 460,862 445,399 Net current liabilities (243,556) (157,411)

Non-current liability Borrowings 33 118,013 210,018 Total liabilities 578,875 655,417

Net assets 850,940 849,659

Equity attributable to owners of the parentShare capital 28 253,650 253,650 Share premium 28 101,059 101,059 Treasury shares 28 (4,815) (4,811)Retained earnings 31 501,046 499,761 Total equity 850,940 849,659

Total equity and liabilities 1,429,815 1,505,076



42

Attributable to owners of the parent Non-distributable Equity attributable Retained to owners earnings/ of the Currency (Accu- Non- Equity, parent, Share Share Treasury translation Other mulated controlling Note total total capital premium shares reserve reserve losses) interests 2012 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Group

Opening balance at 1 March 2011 411,671 318,140 253,650 101,059 (4,811) (222) (19,944) (11,592) 93,531

Total comprehensive income 128,237 114,818 – – – 5 – 114,813 13,419 Transactions with owners Purchase of treasury shares 28 (4) (4) – – (4) – – – –Acquisition of non-controlling interests 46(b) (3,217) – – – – – – – (3,217)Dilution of equity interest in subsidiaries 30 7 (2,636) – – – – (2,636) – 2,643Dividends on ordinary shares 12 (47,880) (47,880) – – – – – (47,880) –Dividends paid by a subsidiary (8,087) – – – – – – – (8,087)

Total transactions with owners (59,181) (50,520) – – (4) – (2,636) (47,880) (8,661) Closing balance at 29 February 2012 480,727 382,438 253,650 101,059 (4,815) (217) (22,580) 55,341 98,289

Statements of Changes in EquityFor the year ended 29 February 2012

43

Attributable to owners of the parent Non-distributable Equity attributable to owners of the Currency Accu- Non- Equity, parent, Share Share Treasury translation Other mulated controlling Note total total capital premium shares reserve reserve losses interests 2011 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Group

Opening balance at 1 March 2010 396,153 334,171 253,650 136,047 (35,230) (232) (7,782) (12,282) 61,982Effects of adopting FRS 139 150 150 – – – – – 150 –

396,303 334,321 253,650 136,047 (35,230) (232) (7,782) (12,132) 61,982

Total comprehensive income 50,275 30,192 – – – 10 – 30,182 20,083

Transactions with owners Purchase of treasury shares 28 (4,569) (4,569) – – (4,569) – – – –Treasury shares distributed as dividends 28 – – – (34,988) 34,988 – – – –Acquisition of a subsidiary 29,229 18,917 – – – – 18,917 – 10,312Acquisition of non-controlling interests (26,263) – – – – – – – (26,263)Dilution of equity interest in subsidiaries 30 – (31,079) – – – – (31,079) – 31,079 Issuance of warrants to advisers 29 4,303 – – – – – – – 4,303 Dividends on ordinary shares 12 (29,642) (29,642) – – – – – (29,642) –Dividends paid by a subsidiary (7,965) – – – – – – – (7,965)

Total transactions with owners (34,907) (46,373) – (34,988) 30,419 – (12,162) (29,642) 11,466

Closing balance at 28 February 2011 411,671 318,140 253,650 101,059 (4,811) (222) (19,944) (11,592) 93,531

Statements of Changes in Equity (cont’d)For the year ended 29 February 2012


44

Non-distributable Equity, Share Share Treasury Retained Note total capital premium shares earnings RM’000 RM’000 RM’000 RM’000 RM’000 Company

Opening balance at 1 March 2011 (as previously stated) 800,875 253,650 101,059 (4,811) 450,977Prior year adjustment 45 48,784 – – – 48,784

Opening balance at 1 March 2011 (restated) 849,659 253,650 101,059 (4,811) 499,761Total comprehensive income 49,165 – – – 49,165Transactions with owners Purchase of treasury shares 28 (4) – – (4) –Dividends on ordinary shares 12 (47,880) – – – (47,880)

Total transactions with owners (47,884) – – (4) (47,880)

Closing balance at 29 February 2012 850,940 253,650 101,059 (4,815) 501,046

Opening balance at 1 March 2010 330,216 253,650 136,047 (35,230) (24,251)

Total comprehensive income (restated) 553,654 – – – 553,654Transactions with owners Purchase of treasury shares 28 (4,569) – – (4,569) –Treasury shares distributed as dividends 28 – – (34,988) 34,988 –Dividends on ordinary shares 12 (29,642) – – – (29,642)

Total transactions with owners (34,211) – (34,988) 30,419 (29,642)

Closing balance at 28 February 2011 849,659 253,650 101,059 (4,811) 499,761


Statements of Changes in Equity (cont’d)For the year ended 29 February 2012

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Statements of Cash FlowsFor the year ended 29 February 2012


Operating activities

Profit before tax 158,298 73,700 50,208 561,767

Adjustments for:Amortisation of biological assets 66 – – –Amortisation of land use rights 649 702 – –Amortisation of other investments – 12 – –Bad debts written off 32 69 – –Changes in fair value of marketable securities 2,576 (237) 2,576 (237)Cost of acquisition and reorganisation – 40,496 – –Depreciation 22,835 23,578 8 13 Dividend income (1) (44) (78,025) (31,416)Employee benefits 527 419 – –Gain on disposal of land held for property development (100,695) – – –Gain on disposal of land use rights – (1,530) – –Gain on disposal of property, plant and equipment (270) (15,814) – –Gain on disposal of subsidiaries – – – (553,077)Impairment loss on investment in subsidiaries – – 14,441 –Impairment loss on property, plant and equipment 3,736 – – –Impairment loss on receivables 523 209 4,114 46,369 Interest expense 16,477 22,038 10,913 15,513 Interest income (2,507) (1,794) (7,382) (16,839)Inventories written back (1,253) (1,638) – –Inventories written down 335 758 – –Inventories written off 262 275 – –Loss on disposal of property, plant and equipment 218 – – –Property, plant and equipment written off 519 161 – –Reversal of impairment loss on land use rights (147) (767) – –Reversal of impairment loss on property, plant and equipment (683) (3,333) – –Reversal of impairment loss on receivables (3) (103) – (38)

Balance carried forward 101,494 137,157 (3,147) 22,055


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Group Company 2012 2011 2012 2011 Restated Note RM’000 RM’000 RM’000 RM’000

Operating activities (cont’d.)

Balance brought forward 101,494 137,157 (3,147) 22,055Reversal of provisions – (27,635) – (27,635)Share of results of an associate (22) 28 – –Unrealised (gain)/loss on foreign exchange - net (667) (1,127) (14) 90

Operating cash flows before changes in working capital 100,805 108,423 (3,161) (5,490)

Changes in working capital: Increase in inventories (24,788) (3,667) – – (Increase)/decrease in receivables (1,943) 5,686 – (64) Increase/(decrease) in payables 4,926 (22,497) (2,485) 2,066

Cash generated from/(used in) operations 79,000 87,945 (5,646) (3,488) Tax paid (31,606) (20,796) (637) (703)Employee benefits paid (265) (115) – –

Net cash flows generated from/ (used in) operating activities 47,129 67,034 (6,283) (4,191)

Investing activities

Acquisition of biological assets (208) (449) – –Acquisition of investment properties (42) (1,069) – –Acquisition of property, plant and equipment (12,974) (10,885) – –Acquisition of subsidiaries 19(b) – 89 – (14,933)Dividend received 1 33 72,595 32,547 Interest received 2,507 1,794 7,382 16,839 Payment of development costs (4,450) (7,439) – –Proceeds from disposal of land held for property development 145,000 – – –Proceeds from disposal of land use rights – 1,556 – –Proceeds from disposal of property, plant and equipment 415 20,003 – –Proceeds from disposal of subsidiaries – – – 24,801

Net cash flows generated from investing activities 130,249 3,633 79,977 59,254

Statements of Cash Flows (cont’d)For the year ended 29 February 2012

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Group Company 2012 2011 2012 2011 Restated Note RM’000 RM’000 RM’000 RM’000

Financing activities

Acquisition of non-controlling interests 46(b) (3,217) (26,263) – –Repayment from/(advances to) subsidiaries – – 92,343 (1,167)Dividends paid to non-controlling interests of a subsidiary (6,804) (10,753) – –Dividend paid to ordinary shareholders of the Company (22,680) (43,473) (22,680) (43,473)Interest paid (16,447) (22,152) (10,883) (15,627)Proceeds from borrowings 60,281 106,152 – –Repayment of borrowings (204,000) (47,831) (100,000) –Repayment of obligations under finance leases (1,745) (1,052) (5) (4)Repurchase of shares (4) (4,569) (4) (4,569)

Net cash flows used in financing activities (194,616) (49,941) (41,229) (64,840) Net (decrease)/increase in cash and cash equivalents (17,238) 20,726 32,465 (9,777)Effect of foreign exchange translation 5 10 – –Cash and cash equivalents at beginning of financial year 133,457 112,721 6,683 16,460

Cash and cash equivalents at end of financial year 26 116,224 133,457 39,148 6,683


Statements of Cash Flows (cont’d)For the year ended 29 February 2012


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1. CORPORATE INFORMATION

Atlan Holdings Bhd. (“the Company”) is a public limited liability company incorporated and domiciled in Malaysia, and is listed on the Bursa Malaysia Securities Berhad. The registered office of the Company is located at Level 4, Wisma Atlan, 8 Persiaran Kampung Jawa, 11900 Bayan Lepas, Penang.

The immediate and ultimate holding company is Distinct Continent Sdn. Bhd., a private limited liability company incorporated in Malaysia.

The principal activities of the Company are investment holding and the provision of management, financial, technical and other ancillary services.

The principal activities of the subsidiaries are set out in Note 19.

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

The financial statements for the year ended 29 February 2012 were authorised for issue in accordance with a resolution of the directors on 15 June 2012.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

2.1 Basis of preparation

The financial statements of the Group and of the Company have been prepared in accordance with Financial Reporting Standards (“FRS”) and the Companies Act, 1965 in Malaysia. At the beginning of the current financial year, the Group and the Company adopted new and revised FRS which are mandatory for financial periods beginning on or after 1 March 2011 as described fully in Note 2.2.

The financial statements have been prepared on the historical cost basis except as disclosed in the accounting policies below.

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

2.2 Changes in accounting policies

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

On 1 March 2011, the Group and the Company adopted the following applicable new and amended FRS and IC Interpretations mandatory for annual financial periods beginning on or after 1 March 2011.

Effective for annual periods beginning onDescription or after FRS 1 First-time Adoption of Financial Reporting Standards 1 July 2010Amendments to FRS 2 Share-based Payment 1 July 2010FRS 3 Business Combinations 1 July 2010Amendments to FRS 5 Non-current Assets Held for Sale and Discontinued Operations 1 July 2010Amendments to FRS 127 Consolidated and Separate Financial Statements 1 July 2010Amendments to FRS 138 Intangible Assets 1 July 2010Amendments to IC Interpretation 9 Reassessment of Embedded Derivatives 1 July 2010IC Interpretation 12 Service Concession Arrangements 1 July 2010IC Interpretation 16 Hedges of a Net Investment in a Foreign Operation 1 July 2010IC Interpretation 17 Distributions of Non-cash Assets to Owners 1 July 2010

Notes to the Financial Statements– 29 February 2012

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

2.2 Changes in accounting policies (cont’d.)

Effective for annual periods beginning onDescription or after

Amendments to FRS 132: Classification of Rights Issues 1 March 2010IC Interpretation 18 Transfers of Assets from Customers 1 January 2011Amendments to FRS 7: Improving Disclosures about Financial Instruments 1 January 2011Amendments to FRS 1: Limited Exemptions for First-time Adopters 1 January 2011Amendments to FRS 1: Additional Exemptions for First-time Adopters 1 January 2011IC Interpretation 4 Determining Whether an Arrangement contains a Lease 1 January 2011Improvements to FRS issued in 2010 1 January 2011

Adoption of the above standards and interpretations did not have any effect on the financial performance and position of the Group and of the Company except for those discussed below:

Revised FRS 3 Business Combinations and Amendments to FRS 127 Consolidated and Separate Financial Statements

The revised standards are effective for annual periods beginning on or after 1 July 2010. The revised FRS 3 introduces a number of changes in accounting for business combinations occurring after 1 July 2010. These changes impact the amount of goodwill recognised, the reported results in the period that an acquisition occurs, and future reported results.

The revised FRS 3 continues to apply the acquisition method to business combinations but with some significant changes. All payments to purchase a business are recorded at fair value at the acquisition date, with contingent payments classified as debt subsequently remeasured through the statement of comprehensive income. There is a choice on an acquisition-by-acquisition basis to measure the non-controlling interest in the acquiree either at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets. All acquisition-related costs are expensed.

The amendments to FRS 127 require that a change in the ownership interest of a subsidiary (without loss of control) is accounted for as an equity transaction. Therefore, such transactions will no longer give rise to goodwill, nor will they give rise to a gain or loss. Furthermore, the amended standard changes the accounting for losses incurred by the subsidiary as well as the loss of control of a subsidiary.

Amendments to FRS 7: Improving Disclosures about Financial Instruments

The amended standard requires enhanced disclosure about fair value measurement and liquidity risk. Fair value measurements related to items recorded at fair value are to be disclosed by source of inputs using a three level fair value hierarchy (Level 1, Level 2 and Level 3), by class, for all financial instruments recognised at fair value. A reconciliation between the beginning and ending balance for Level 3 fair value measurements is required. Any significant transfers between levels of the fair value hierarchy and the reasons for those transfers need to be disclosed. The amendments also clarify the requirements for liquidity risk disclosures with respect to derivative transactions and assets used for liquidity management. The fair value measurement disclosures are presented in Note 40. The liquidity risk disclosures are not significantly impacted by the amendments and are presented in Note 41(b).

Amendments to FRS 5 Non-current Assets Held for Sale and Discontinued Operations

The amendments to FRS 5 requires that when a subsidiary is held for sale, all its assets and liabilities shall be classified as held for sale under FRS 5, even when the Group will retain a non-controlling interest in the subsidiary after the sale.

Notes to the Financial Statements (cont’d)– 29 February 2012


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2.3 Standards issued but not yet effective

Malaysian Financial Reporting Standards

On 19 November 2011, the Malaysian Accounting Standards Board (“MASB”) issued a new MASB approved accounting framework, the Malaysian Financial Reporting Standards (“MFRS Framework”).

The MFRS Framework is to be applied by all Entities Other Than Private Entities for annual periods beginning on or after 1 January 2012, with the exception of entities that are within the scope of MFRS 141 Agriculture (“MFRS 141”) and IC Interpretation 15 Agreements for Construction of Real Estate (“IC 15”), including its parent, significant investor and venturer.

The Group will be required to prepare financial statements using the MFRS Framework in its first MFRS financial statements for the year ending 28 February 2013. In presenting its first MFRS financial statements, the Group will be required to restate the comparative financial statements to amounts reflecting the application of MFRS Framework. The majority of the adjustments required on transition will be made, retrospectively, against opening retained earnings.

The Group has not completed its assessment of the financial effects of the differences between Financial Reporting Standards and accounting standards under the MFRS Framework. Accordingly, the consolidated financial performance and financial position as disclosed in these financial statements for the year ended 29 February 2012 could be different if prepared under the MFRS Framework.

The Group considers that it is achieving its scheduled milestones and expects to be in a position to fully comply with the requirements of the MFRS Framework for the financial year ending 28 February 2013.

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.

All intra-group balances, income and expenses and unrealised gains and losses resulting from intra-group transactions are eliminated in full.

Acquisitions of subsidiaries are accounted for by applying the acquisition method. Identifiable assets acquired and liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Acquisition-related costs are recognised as expenses in the periods in which the costs are incurred and the services are received.

In business combinations achieved in stages, previously held equity interests in the acquiree are re-measured to fair value at the acquisition date and any corresponding gain or loss is recognised in profit or loss.

The Group elects for each individual business combination, whether non-controlling interest in the acquiree (if any) is recognised on the acquisition date at fair value, or at the non-controlling interest’s proportionate share of the acquiree net identifiable assets.

Any excess of the sum of the fair value of the consideration transferred in the business combination, the amount of non-controlling interest in the acquiree (if any), and the fair value of the Group’s previously held equity interest in the acquiree (if any), over the net fair value of the acquiree’s identifiable assets and liabilities is recorded as goodwill in the statement of financial position. The accounting policy for goodwill is set out in Note 2.9. In instances where the latter amount exceeds the former, the excess is recognised as a gain on bargain purchase in profit or loss on the acquisition date.

Subsidiaries are consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases.

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2.5 Transactions with non-controlling interests

Non-controlling interest represents the equity in subsidiaries not attributable, directly or indirectly, to owners of the Company, and is presented separately in the consolidated statement of comprehensive income and within equity in the consolidated statement of financial position, separately from equity attributable to owners of the Company.

Changes in the Company owners’ ownership interest in a subsidiary that do not result in a loss of control are accounted for as equity transactions. In such circumstances, the carrying amounts of the controlling and non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiary. Any difference between the amount by which the non-controlling interest is adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to owners of the parent.

2.6 Foreign currency

(a) Functional and presentation currency

The individual financial statements of each entity in the Group are measured using the currency of the primary economic environment in which the entity operates (“the functional currency”). The consolidated financial statements are presented in Ringgit Malaysia (“RM”), which is also the Company’s functional currency.

(b) Foreign currency transactions

Transactions in foreign currencies are measured in the respective functional currencies of the Company and its subsidiaries and are recorded on initial recognition in the functional currencies at exchange rates approximating those ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated at the rate of exchange ruling at the reporting date. Non-monetary items denominated in foreign currencies that are measured at historical cost are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items denominated in foreign currencies measured at fair value are translated using the exchange rates at the date when the fair value was determined.

Exchange differences arising on the settlement of monetary items or on translating monetary items at the reporting date are recognised in profit or loss except for exchange differences arising on monetary items that form part of the Group’s net investment in foreign operations, which are recognised initially in other comprehensive income and accumulated under foreign currency translation reserve in equity. The foreign currency translation reserve is reclassified from equity to profit or loss of the Group on disposal of the foreign operation.

Exchange differences arising on the translation of non-monetary items carried at fair value are included in profit or loss for the period except for the differences arising on the translation of non-monetary items in respect of which gains and losses are recognised directly in equity. Exchange differences arising from such non-monetary items are also recognised directly in equity.

(c) Foreign operations

The assets and liabilities of foreign operations are translated into RM at the rate of exchange ruling at the reporting date and income and expenses are translated at exchange rates at the dates of the transactions. The exchange differences arising on the translation are taken directly to other comprehensive income. On disposal of a foreign operation, the cumulative amount recognised in other comprehensive income and accumulated in equity under foreign currency translation reserve relating to that particular foreign operation is recognised in the profit or loss.

Goodwill and fair value adjustments arising on the acquisition of foreign operations are treated as assets and liabilities of the foreign operations and are recorded in the functional currency of the foreign operations and translated at the closing rate at the reporting date.


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2.7 Property, plant and equipment

All items of property, plant and equipment are initially recorded at cost. The cost of an item of property, plant and equipment is recognised as an asset if, and only if, it is probable that future economic benefits associated with the item will flow to the Group and to the Company and the cost of the item can be measured reliably.

Subsequent to recognition, property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses, if any. When significant parts of property, plant and equipment are required to be replaced in intervals, the Group recognises such parts as individual assets with specific useful lives and depreciation, respectively. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in profit or loss as incurred.

The Group has availed itself to the transitional provisions when the Malaysian Accounting Standards Board first issued FRS1162004 which allow certain properties to be carried at their 1992 valuation less depreciation. Accordingly, these valuations have not been updated.

Freehold land is stated at cost less accumulated impairment losses, if any. Freehold land has an unlimited useful life and therefore is not depreciated. Depreciation is computed on a straight-line basis over the estimated useful lives of the assets as follows:

Buildings over 29 to 50 yearsLeasehold land over 99 yearsGolf course over 60 yearsMotor vehicles 20%Office equipment, furniture and fittings 5% - 33.3%Plant and machinery 10% - 33.3%Other assets 5% - 20%

Buildings situated on leased land are amortised over the unexpired term of leases.

Capital work-in-progress is 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 the profit or loss in the year the asset is derecognised.

2.8 Investment properties

Investment properties are initially measured at cost, including transaction costs. Subsequent to initial recognition, investment properties are carried at cost less accumulated depreciation and impairment losses, if any.

Investment properties are depreciated over the period of the lease of 36.5 to 99 years.

Investment properties are derecognised when either they have been disposed off 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.

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2.9 Goodwill

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

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

The cash-generating unit to which goodwill has been allocated is tested for impairment annually and whenever there is an indication that the cash-generating unit may be impaired. Impairment is determined for goodwill by assessing the recoverable amount of each cash-generating unit (or group of cash-generating units) to which the goodwill relates. 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 off, the goodwill associated with the operation disposed off is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed off in this circumstance is measured based on the relative fair values of the operations disposed off and the portion of the cash-generating unit retained.

2.10 Land use rights

Land use rights are initially measured at cost. Following initial recognition, land use rights are measured at cost less accumulated amortisation and accumulated impairment losses, if any. The land use rights are amortised on a straight-line basis over the respective lease terms of 6 to 43 years.

2.11 Impairment of non-financial assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when an annual impairment assessment for an asset is required, the Group makes an estimate of the asset’s recoverable amount.

An asset’s recoverable amount is the higher of an asset’s fair value less costs to sell and its value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units (“CGU”)).

In assessing value in use, the estimated future cash flows expected to be generated by the asset are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Where the carrying amount of an asset exceeds its recoverable amount, the asset is written down to its recoverable amount. Impairment losses recognised in respect of a CGU or groups of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to those units or groups of units and then, to reduce the carrying amount of the other assets in the unit or groups of units on a pro-rata basis.

Impairment losses are recognised in profit or loss.

An assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increase cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised previously. Such reversal is recognised in profit or loss.


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2.12 Subsidiaries

A subsidiary is an entity over which the Group has the power to govern the financial and operating policies so as to obtain benefits from its activities.

In the Company’s separate financial statements, investments in subsidiaries are accounted for at cost less impairment losses.

2.13 Associates

An associate is an entity, not being a subsidiary or a joint venture, in which the Group has significant influence. An associate is equity accounted for from the date the Group obtains significant influence until the date the Group ceases to have significant influence over the associate.

The Group’s investments in associates are accounted for using the equity method. Under the equity method, the investment in associates is measured in the statement of financial position at cost plus post-acquisition changes in the Group’s share of net assets of the associates. Goodwill relating to associates is included in the carrying amount of the investment. Any excess of the Group’s share of the net fair value of the associate’s identifiable assets, liabilities and contingent liabilities over the cost of the investment is excluded from the carrying amount of the investment and is instead included as income in the determination of the Group’s share of the associate’s profit or loss for the period in which the investment is acquired.

When the Group’s share of losses in an associate equals or exceeds its interest in the associate, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss on the Group’s investment in its associates. The Group determines at each reporting date whether there is any objective evidence that the investment in the associate is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount in profit or loss.

The most recent available audited financial statements of the associate is used by the Group in applying the equity method. Where the dates of the audited financial statements used are not coterminous with those of the Group, the share of results is arrived at from the last audited financial statements available and management financial statements to the end of the accounting period. Uniform accounting policies are adopted for like transactions and events in similar circumstances.

In the Company’s separate financial statements, investments in associates are stated at cost less impairment losses, if any. On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is included in profit or loss.

2.14 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.

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2.14 Financial assets (cont’d.)

(a) Financial assets at fair value through profit or loss

Financial assets are classified as financial assets at fair value through profit or loss if they are held for trading or are designated as such upon initial recognition. Financial assets held for trading are derivatives (including separated embedded derivatives) or financial assets acquired principally for the purpose of selling in the near term.

Subsequent to initial recognition, financial assets at fair value through profit or loss are measured at fair value. Any gains or losses arising from changes in fair value are recognised in profit or loss. Net gains or net losses on financial assets at fair value through profit or loss do not include exchange differences, interest and dividend income. Exchange differences, interest and dividend income on financial assets at fair value through profit or loss are recognised separately in profit or loss as part of other losses or other income.

Financial assets at fair value through profit or loss could be presented as current or non-current. Financial assets that are held primarily for trading purposes are presented as current whereas financial assets that are not held primarily for trading purposes are presented as current or non-current based on the settlement date.

(b) Loans and receivables

Financial assets with fixed or determinable payments that are not quoted in an active market are classified as loans and receivables.

Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired, and through the amortisation process.

Loans and receivables are classified as current assets, except for those having maturity dates later than 12 months after the reporting date which are classified as non-current.

(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) Available-for-sale financial assets

Available-for-sale financial assets are financial assets that are designated as available for sale or are not classified in any of the three preceding categories.


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2.14 Financial assets (cont’d.)

(d) Available-for-sale financial assets (cont’d.)

After initial recognition, available-for-sale financial assets are measured at fair value. Any gains or losses from changes in fair value of the financial assets are recognised in other comprehensive income, except that impairment losses, foreign exchange gains and losses on monetary instruments and interest calculated using the effective interest method are recognised in profit or loss. The cumulative gain or loss previously recognised in other comprehensive income is reclassified from equity to profit or loss as a reclassification adjustment when the financial asset is derecognised. Interest income calculated using the effective interest method is recognised in profit or loss. Dividends on an available-for-sale equity instrument are recognised in profit or loss when the Group’s and the Company’s right to receive payment is established.

Investments in equity instruments whose fair value cannot be reliably measured are measured at cost less impairment loss, if any.

Available-for-sale financial assets are classified as non-current assets unless they are expected to be realised within 12 months after the reporting date.

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.

2.15 Impairment of financial assets

The Group and the Company assess at each reporting date whether there is any objective evidence that a financial asset is impaired.

(a) 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 Group’s 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 asset’s carrying amount and the present value of estimated future cash flows discounted at the financial asset’s 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.

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2.15 Impairment of financial assets (cont’d.)

(a) Trade and other receivables and other financial assets carried at amortised cost (cont’d.)

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) Unquoted equity securities carried at cost

If there is objective evidence (such as significant adverse changes in the business environment where the issuer operates, probability of insolvency or significant financial difficulties of the issuer) that an impairment loss on financial assets carried at cost has been incurred, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the current market rate of return for a similar financial asset. Such impairment losses are not reversed in subsequent periods.

(c) Available-for-sale financial assets

Significant or prolonged decline in fair value below cost, significant financial difficulties of the issuer or obligor, and the disappearance of an active trading market are considerations to determine whether there is objective evidence that investment securities classified as available-for-sale financial assets are impaired.

If an available-for-sale financial asset is impaired, an amount comprising the difference between its cost (net of any principal payment and amortisation) and its current fair value, less any impairment loss previously recognised in profit or loss, is transferred from equity to profit or loss.

Impairment losses on available-for-sale equity investments are not reversed in profit or loss in the subsequent periods. Increase in fair value, if any, subsequent to impairment loss is recognised in other comprehensive income. For available-for-sale debt investments, impairment losses are subsequently reversed in profit or loss if an increase in the fair value of the investment can be objectively related to an event occurring after the recognition of the impairment loss in profit or loss.

2.16 Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and on hand, demand deposits, and short-term, highly liquid investments that are readily convertible to known amount of cash and which are subject to an insignificant risk of changes in value. These also include bank overdrafts that form an integral part of the Group’s cash management.

2.17 Land held for property development and property development costs

(i) Land held for property development

Land held for property development consists of land where no development activities have been carried out or where development activities are not expected to be completed within the normal operating cycle. Such land is classified within non-current assets and is stated at cost less accumulated impairment losses, if any.

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


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2.17 Land held for property development and property development costs (cont’d.)

(ii) Property development costs

Property development costs comprise all costs that are directly attributable to development activities or that can be allocated on a reasonable basis to such activities.

When the financial outcome of a development activity can be reliably estimated, property development revenue and expenses are recognised in profit or loss by using the stage of completion method. The stage of completion is determined by the proportion that property development costs incurred for work performed to date bear to the estimated total property development costs.

Where the financial outcome of a development activity cannot be reliably estimated, property development revenue is recognised only to the extent of property development costs incurred that is probable will be recoverable, and property development costs on properties sold are recognised as an expense in the period in which they are incurred.

Any expected loss on a development project, including costs to be incurred over the defects liability period, is recognised as an expense immediately.

Property development costs not recognised as an expense are recognised as an asset, which is measured at the lower of cost and net realisable value.

The excess of revenue recognised in the profit or loss over billings to purchasers is classified as accrued billings within trade receivables and the excess of billings to purchasers over revenue recognised in profit or loss is classified as progress billings within trade payables.

2.18 Inventories

Inventories are stated at the lower of cost and net realisable value.

Costs incurred in bringing the inventories to their present location and condition are accounted for on a first-in first-out basis, and comprise costs of purchase.

The costs of finished goods and work-in-progress comprise cost of materials and direct labour and a proportion of manufacturing overheads based on normal operating capacity. These costs are assigned on a first-in first-out basis.

The cost of completed development properties comprises cost associated with the acquisition of land, direct costs and appropriate proportions of common costs.

Where necessary, allowance is provided for damaged, obsolete and slow moving items to adjust the carrying value of inventories to the lower of cost and net realisable value.

Net realisable value is the estimated selling price in the ordinary course of business less estimated costs of completion and the estimated costs necessary to make the sale.

2.19 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.

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2.20 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 FRS 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) Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss include financial liabilities held for trading and financial liabilities designated upon initial recognition as at fair value through profit or loss.

Financial liabilities held for trading include derivatives entered into by the Group and by the Company that do not meet the hedge accounting criteria. Derivative liabilities are initially measured at fair value and subsequently stated at fair value, with any resultant gains or losses recognised in profit or loss. Net gains or losses on derivatives include exchange differences.

The Group and the Company have not designated any financial liabilities as at fair value through profit or loss.

(b) Other financial liabilities

The Group’s and the Company’s other financial liabilities include trade payables, other payables and loans and borrowings.

Trade and other payables are recognised initially at fair value plus directly attributable transaction

costs and subsequently measured at amortised cost using the effective interest method.

Loans and borrowings are recognised initially at fair value, net of transaction costs incurred, and subsequently measured at amortised cost using the effective interest method. Borrowings are classified as current liabilities unless the group has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

For other financial liabilities, gains and losses are recognised in profit or loss when the liabilities are derecognised, and through the amortisation process.

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.

2.21 Financial guarantee contracts

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimburse the holder for a loss it incurs because a specified debtor fails to make payment when due.

Financial guarantee contracts are recognised initially as a liability at fair value, net of transaction costs. Subsequent to initial recognition, financial guarantee contracts are recognised as income in profit or loss over the period of the guarantee. If the debtors fails to make payment relating to financial guarantee contract when it is due and the Group, as the issuer, is required to reimburse the holder for the associated loss, the liability is measured at the higher of the best estimate of the expenditure required to settle the present obligation at the reporting and the amount initially recognised less cumulative amortisation.


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2.22 Borrowing costs

Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly attributable to the acquisition, construction or production of that asset. 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.

2.23 Employee benefits

(a) Defined contribution plans

The Group participates in the national pension schemes as defined by the laws of the countries in which it has operations. The Malaysian companies in the Group make contributions to the Employee Provident Fund in Malaysia, while the Singaporean company in the Group makes contributions to the Central Provident Fund scheme in Singapore; both of which are defined contribution pension schemes. Contributions to defined contribution pension schemes are recognised as an expense in the period in which the related service is performed.

(b) Defined benefit plans

The Group operates an unfunded, defined benefit plan for its eligible employees. The Group’s net obligation in respect of defined benefit plan is calculated by estimating the amount of future benefit that employees have earned in return for their services in the current and prior periods and that benefit is discounted to determine the present value. The discount rate is the market yield at the balance sheet date on high quality corporate bonds or government bonds. The calculation is performed by an actuary using the projected unit credit method.

When the benefits of a plan are improved, the portion of the increased benefit relating to past services by employees is recognised as an expense in profit or loss on a straight line basis over the average period until the benefits become vested. To the extent that the benefits vest immediately, the expense is recognised immediately in profit or loss.

In calculating the Group’s obligation in respect of a plan, to the extent that any cumulative unrecognised actuarial gain or loss exceeds ten percent of the present value of the defined benefit obligation, that portion is recognised in profit or loss over the expected average remaining working lives of the employees participating in the plan. Otherwise, the actuarial gain or loss is not recognised.

Where the calculation results in a benefit to the Group, the recognised asset is limited to the net total of any unrecognised actuarial losses and past service costs and the present value of any future refunds from the plan or reductions in future contributions to the plan.

The amount recognised in statements of financial position represents the present value of the defined benefit obligation adjusted for unrecognised actuarial gains and losses and unrecognised past service costs.

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2.24 Leases

(a) As lessee

Finance leases, which transfer to the Group and to the Company 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 and the Company 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.

(b) As lessor

Leases where the Group retains 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 2.26(h).

2.25 Discontinued operation

A component of the Group is classified as a “discontinued operation” when the criteria to be classified as held for sale have been met or it has been disposed off and such a component represents a separate major line of business or geographical area of operations or is part of a single coordinated major line of business or geographical area of operations. A component is deemed to be held for sale if its carrying amounts will be recovered principally through a sale transaction rather than through continuing use.

Upon classification as held for sale, non-current assets and disposal groups are not depreciated and are measured at the lower of carrying amount and fair value less costs to sell. Any differences are recognised in profit or loss.

2.26 Revenue

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and to the Company and the revenue can be reliably measured. Revenue is measured at the fair value of consideration received or receivable.

(a) Sale of goods

Revenue from sale of goods is recognised upon the transfer of significant risks and rewards of ownership of the goods to the customer. 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.

(b) Dividend income

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


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2.26 Revenue (cont’d.)

(c) Ferry terminal operations

Revenue from ferry terminal operations is recognised on an accrual basis.

(d) Sale of high speed diesel Sale of high speed diesel is recognised on an accrual basis.

(e) Rental of hotel rooms and other services

Revenue from rental of hotel rooms and other related services are recognised on an accrual basis.

(f) Management income

Management income is received from a third party operator who manages golf course of a subsidiary. The income is recognised on an accrual basis.

(g) Interest income

Interest income is recognised using the effective interest method.

(h) Rental, parking and related services

Rental income is recognised on a straight-line basis over the rental tenancy agreements or over the term of the lease. The aggregate costs of incentives provided to lessees are recognised as a reduction of rental income over the lease term on a straight-line basis.

Parking and related services are recognised net of discounts as and when the services are rendered. (i) Sale of food and beverage

Sale of food and beverage are recognised as and when the services are performed.

(j) Sales of properties

Revenue relating to sale of completed properties is recognised net of discounts upon the transfer of risks and rewards. Revenue from properties under development is accounted for by the stage of completion method as described in Note 2.17(ii).

(k) Income from tour, travel and recreational activities

Income from tour, travel and recreational activities is recognised as and when the services are rendered.

(l) Sale of palm oil

Revenue from sale of palm oil is recognised when significant risks and rewards of ownership of goods are transferred to the customer.

(m) Management fees Management fees are recognised on an accrual basis.

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2.27 Income taxes

(a) 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.

(b) 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

- in respect of taxable temporary differences associated with investments in subsidiaries and associates, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised except:

- 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

- in respect of deductible temporary differences associated with investments in subsidiaries and associates, deferred tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilised.

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.


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2.27 Income taxes (cont’d.)

(b) Deferred tax (cont’d.)

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.

(c) Sales tax

Revenues, expenses and assets are recognised net of the amount of sales tax except:

- Where the sales tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case the sales tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and

- Receivables and payables that are stated with the amount of sales tax included.

The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the statements of financial position.

2.28 Biological assets

Biological assets comprise oil palm planting expenditure. Expenditure incurred on new planting and the upkeep of trees to maturity is recognised under plantation development expenditure, while replanting expenditure is charged to profit or loss in the year in which the expenditure is incurred. A portion of the direct overheads, which include general and administrative expenses, is similarly recognised under biological assets until such time when the plantation attains maturity. Plantation development expenditure is amortised over 25 years, the expected useful life of oil palm trees. Amortisation commences upon maturity of the new plantings.

2.29 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.

2.30 Share capital and share issuance expenses

An equity instrument is any contract that evidences a residual interest in the assets of the Group and of the Company after deducting all of its liabilities. Ordinary shares are equity instruments.

Ordinary shares are recorded at the proceeds received, net of directly attributable incremental transaction costs. Ordinary shares are classified as equity. Dividends on ordinary shares are recognised in equity in the period in which they are declared.

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2.31 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.

2.32 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.

Contingent liabilities and assets are not recognised in the statements of financial position of the Group and of the Company.

3. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES

The preparation of the Group’s financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure of contingent liabilities at the reporting date. However, uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustment to the carrying amount of the asset or liability affected in the future.

3.1 Judgements made in applying accounting policies

In the process of applying the Group’s accounting policies, management has made the following judgements, apart from those involving estimations, which have the most significant effect on the amounts recognised in the financial statements:

(a) Classification between investment properties and property, plant and equipment, and between investment properties and land held for property development

The Group has developed certain criteria based on FRS 140 in making judgement whether a property qualified as an investment property. Investment property is a property held to earn rentals or for capital appreciation or both.

Some properties comprise a portion that is held to earn rentals or for capital appreciation and another portion that is held for use in the production or supply of goods or services or for administrative purposes. If these portions could be sold separately (or leased out separately under a finance lease), the Group would account for the portions separately. If the portions could not be sold separately, the property is an investment property only if an insignificant portion is held for use in the production or supply of goods or services or for administrative purposes. Judgement is made on an individual property basis to determine whether ancillary services are so significant that a property does not qualify as investment property.

One of the buildings of the Group is being substantially let out to earn rental income. Accordingly, this property is classified as investment property.

A certain piece of long term leasehold land of the Group, previously disclosed as land held for property development, has been identified as being held for capital appreciation. Accordingly, this property is reclassified as investment property from prior year’s classification of land held for property development.


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3. SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES (CONT’D.)

3.1 Judgements made in applying accounting policies (cont’d.)

(a) Classification between investment properties and property, plant and equipment, and between investment properties and land held for property development (cont’d.)

The following comparatives have been restated in the statements of financial position:

As previously As stated Adjustment restated RM’000 RM’000 RM’000

As at 28 February 2011Land held for property development 58,086 (15,134) 42,952Investment properties 53,795 15,134 68,929 As at 28 February 2010Land held for property development 93,032 (15,321) 77,711Investment properties 56,327 15,321 71,648

The following reclassifications were made to the consolidated income statements of prior year to be consistent with current year presentation arising from the above change:

As previously As stated Adjustment restated RM’000 RM’000 RM’000 As at 28 February 2011 Impairment loss on land held for property development 187 (187) –Depreciation 23,391 187 23,578

The above reclassifications do not have any impact on the net profit of prior year.

(b) Impairment of financial assets

The Group follows the guidance of FRS 139 in determining when a financial asset is considered impaired. This determination requires significant judgement. The Group evaluates, among other factors, the duration and extent to which the fair value of a financial asset is less than its cost; and the financial health of and the near-term business outlook of the issuer of the instrument, including factors such as industry performance, changes in technology and operational and financing cash flows.

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3.2 Key sources of estimation uncertainty

The key assumptions concerning the future and other key sources of estimation uncertainty at the reporting date that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below.

(a) Impairment of goodwill

Goodwill is tested for impairment annually and at other times when such indicators exist. This requires an estimation of the value in use of the cash-generating units to which goodwill is allocated.

When value in use calculations are undertaken, management must estimate the expected future cash flows from the asset or cash-generating unit and choose a suitable discount rate in order to calculate the present value of those cash flows. Further details of the carrying value, the key assumptions applied in the impairment assessment of goodwill and sensitivity analysis to changes in the assumptions are given in Note 18. The carrying amount of the Group’s goodwill is disclosed in Note 18.

(b) Impairment of receivables

The Group and the Company assess at each reporting date whether there is any objective evidence that a financial asset is impaired. To determine whether there is objective evidence of impairment, 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.

Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. The carrying amount of the Group’s and the Company’s receivables at the reporting date is disclosed in Note 22.

Where there is objective of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. The carrying amount of the Group’s and of the Company’s loans and receivables at the reporting date is disclosed in Note 22.

(c) Retirement benefit obligations

The Group has contracted an actuaries to determine the Group’s obligations in respect of the defined benefit plan of the Group. The estimate of the obligations is dependent on the assumptions of the discount rate, future salary increases and price inflation. Any change in these assumptions will affect the estimates.

(d) Provisions

The provisions are determined based on the management’s best estimates after considering the probable outflow of resources embodying economic benefits will be required to settle the obligation.

(e) Useful lives of plant and equipment

The cost of plant and equipment is depreciated on a straight-line basis over the plant and equipment’s estimated useful lives. Management estimates the useful lives of these plant and equipment (excludes freehold land, leasehold land, golf course and buildings) to be within 1 to 10 years. The carrying amount of the Group’s plant and equipment at 29 February 2012 was RM36,994,000 (2011: RM35,080,000). Changes in the expected level of usage and technological developments could impact the economic useful lives and the residual values of these assets, therefore future depreciation charges could be revised.


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3.2 Key sources of estimation uncertainty (cont’d.)

(f) Deferred tax assets

Deferred tax assets are recognised for all unused tax losses and unabsorbed capital allowances to the extent that it is probable that taxable profit will be available against which the losses and capital allowances can be utilised. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of future taxable profits together with future tax planning strategies.

The carrying amount of recognised and unrecognised tax losses and capital allowances of the Group is disclosed in Note 23.

4. REVENUE

Group Company 2012 2011 2012 2011 RM’000 RM’000 RM’000 RM’000

Sale of goods 629,645 662,314 – –Gross dividends: - subsidiaries – – 78,025 31,372 - quoted investment in Malaysia 1 – – – - others – 44 – 44 Ferry terminal operations 8,266 6,773 – –Sale of high speed diesel 10,479 8,052 – –Rental of hotel rooms and other services 28,627 25,923 – –Management fee charged to a subsidiary – – – 300 Management income 540 – – –Interest income: - subsidiaries – – 6,792 16,527 - fixed deposits 2,507 1,794 590 312 Rental, parking and related services 25,386 25,654 – –Sale of food and beverage 12,089 13,037 – –Sale of properties 4,252 165 – –Tour, travel and recreational activities – 1,033 – –Sale of palm oil 248 – – – 722,040 744,789 85,407 48,555

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5. OTHER INCOME

Included in other income are as follows:


Changes in fair value of marketable securities – 237 – 237 Gain on disposal of land held for property development 100,695 – – –Gain on disposal of land use rights – 1,530 – –Gain on disposal of property, plant and equipment 270 15,814 – –Gain on disposal of subsidiaries – – – 553,077 Gain on foreign exchange: - unrealised 667 1,217 14 – - realised 3,002 5,488 – –Incentive income 8,536 10,964 – –Inventories written back* 1,253 1,638 – –Rental income: - advertisement space 3,492 3,551 – – - property, plant and equipment and land use rights 1,489 1,234 – – - others 186 200 – –Reversal of impairment loss on land use rights 147 767 – –Reversal of impairment loss on property, plant and equipment 683 3,333 – –Reversal of impairment loss on receivables: - third parties 3 103 – – - subsidiaries – – – 38 Reversal of provisions (Note 37) – 27,635 – 27,635

* The write back of inventories was made when the related inventories were sold above their carrying amounts.

6. EMPLOYEE BENEFITS EXPENSE


Wages and salaries 57,202 57,783 150 302 Social security contribution 638 668 – –Contribution to defined contribution plan 6,198 6,055 – 28 Increase in liability for defined benefit plan (Note 32(d)) 527 419 – –Other benefits 3,050 4,160 7 37 67,615 69,085 157 367

Included in employee benefits expense of the Group and of the Company are executive directors’ remuneration amounting to RM1,579,000 (2011: RM1,056,000) and RM Nil (2011: RM258,000) respectively.


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7. DIRECTORS’ REMUNERATION

The details of remuneration receivable by directors of the Company during the year are as follows:


Executive:Salaries and other emoluments 1,411 943 – 230 Defined contribution plan 168 113 – 28

Total executive directors’ remuneration (excluding benefits-in-kind) (Note 6) 1,579 1,056 – 258 Estimated money value of benefits-in-kind – 7 – 4

Total executive directors’ remuneration (including benefits-in-kind) 1,579 1,063 – 262

Non-executive:Other emoluments – 18 – –Fees 222 108 150 72

Total non-executive directors’ remuneration (excluding benefits-in-kind) 222 126 150 72Estimated money value of benefits-in-kind – 22 – 22

Total non-executive directors’ remuneration (including benefits-in-kind) 222 148 150 94

Total directors’ remuneration 1,801 1,211 150 356

The number of directors of the Company whose total remuneration during the financial year fell within the following bands is analysed below:

Number of directors 2012 2011

Executive directors: RM250,001 - RM300,000 – 1 RM300,001 - RM350,000 – 1 RM450,001 - RM500,000 – 1 RM750,001 - RM800,000 1 – RM800,001 - RM850,000 1 –Non-executive directors: Below RM50,000 6 7

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8. OTHER OPERATING EXPENSES

Included in other operating expenses are as follows:


Amortisation of biological assets 66 – – –Amortisation of other investments – 12 – –Auditor’s remuneration: - statutory audit 1,137 897 64 58 Bad debts written off 32 69 – –Changes in fair value of marketable securities 2,576 – 2,576 –Cost of acquisition and reorganisation (Note 19(b)) – 40,496 – –Impairment loss on investment in subsidiaries – – 14,441 –Impairment loss on property, plant and equipment 3,736 – – –Impairment loss on receivables: - third parties 523 209 – – - subsidiaries – – 4,114 46,369 Inventories written down 335 758 – –Inventories written off 262 275 – –Lease of land 216 216 – –Legal and professional fees 6,336 8,970 1,042 2,049 Loss on disposal of property, plant and equipment 218 – – –Loss on foreign exchange: - unrealised – 90 – 90 Management fee charged by a subsidiary – – 540 240 Property, plant and equipment written off 519 161 – –Rental expense 17,897 15,851 – –

9. FINANCE COSTS


Interest expense on:- bankers’ acceptance 551 390 – –- bank overdrafts 204 386 – –- obligations under finance leases 214 141 2 2 - USD trade loans 193 – – –- term loans 15,310 21,110 10,911 15,511 - others 5 11 – –

Total finance costs 16,477 22,038 10,913 15,513


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10. INCOME TAX EXPENSE

Major components of income tax expense

The major components of income tax expense for the financial years ended 29/28 February are as follows:


Current income tax- Malaysian income tax 30,615 21,058 1,073 7,563 - (Over)/under provision in respect of previous years (62) 1,023 (30) 550

30,553 22,081 1,043 8,113

Deferred income tax (Note 23)- Origination and reversal of temporary differences (516) 42 – –- Under provision in respect of previous years 29 1,312 – –

(487) 1,354 – –

Income tax expense recognised in profit or loss 30,066 23,435 1,043 8,113

Reconciliation between tax expense and accounting profit

Domestic current income tax is calculated at the Malaysian statutory tax rate of 25% (2011: 25%) of the estimated assessable profit for the year.

The reconciliation between tax expense and the product of accounting profit multiplied by the applicable corporate tax rate for the financial years ended 29/28 February are as follows:


Profit before tax 158,298 73,700 50,208 561,767

Taxation at statutory rate 39,575 18,425 12,552 140,442Effect of different tax rates in other country 367 446 – –Effect of expenses not deductible for tax purposes 13,154 10,553 8,027 12,278Effect of income not subject to taxation (9,597) (12,331) (19,506) (145,152)Utilisation of previously unrecognised deferred tax assets (15,044) (2,832) – (5)Deferred tax assets not recognised during the year 1,644 6,839 – –Under provision of deferred tax in previous years 29 1,312 – –(Over)/under provision of income tax in respect of previous years (62) 1,023 (30) 550

Income tax expense recognised in profit and loss 30,066 23,435 1,043 8,113

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11. EARNINGS PER SHARE

Basic earnings per share amounts are calculated by dividing profit for the year, net of tax, attributable to owners of the parent by the weighted average number of ordinary shares outstanding during the financial year.

The Company does not have any diluted earnings per share.

The following reflect the profit and share data used in the computation of basic earnings per share for the years ended 29/28 February:

Group 2012 2011 RM’000 RM’000

Profit net of tax 128,232 50,265 Non-controlling interests (13,419) (20,083)

Profit attributable to owners of the parent 114,813 30,182

Number Number of shares of shares ‘000 ‘000

Weighted average number of ordinary shares for basic earnings per share computation* 252,001 249,237

* The weighted average number of shares takes into account the weighted average effect of changes in treasury shares transactions during the year.

Group 2012 2011

Sen per Sen per share share Basic earnings per share attributable to owners of the parent 45.56 12.11

There have been no transactions involving ordinary shares or potential ordinary shares since the reporting date and before the completion of these financial statements, except as disclosed in Note 28.


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12. DIVIDENDS

Group and Company 2012 2011 RM’000 RM’000

Recognised during the financial year:

Dividends on ordinary shares:In respect of the financial year ended 28 February 2011:- First interim single tier dividend of 5% – 12,001- Second interim single tier dividend of 5% – 12,601- Third interim tax exempt dividend of 2% – 5,040- Fourth interim single tier dividend of 5% 12,600 –

In respect of the financial year ended 29 February 2012:- First interim single tier dividend of 4% 10,080 –- Special interim single tier dividend of 10% 25,200 –

47,880 29,642

In prior year, the Company declared 12,000,474 treasury shares as share dividends on the basis of one treasury

share for every existing twenty ordinary shares of RM1 each to shareholders of the Company.

13. PROPERTY, PLANT AND EqUIPMENT

Office Capital equipment, Land and Golf work-in- Motor furniture Plant and Other buildings* course progress vehicles and fittings machinery assets Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Group At 29 February 2012

CostAt 1 March 2011 498,307 44,648 1,933 9,527 59,978 135,680 1,409 751,482 Additions 1,504 – 6,615 1,673 1,525 2,631 2 13,950Disposals (2) – (22) (1,317) (5) (759) – (2,105)Write-offs (151) – (383) (8) (93) (1,580) – (2,215)Reclassification 73 – (1,670) – (6) 1,603 – –Transfer to assets classified as held for sale (Note 27) (63,372) – – – – – – (63,372)

At 29 February 2012 436,359 44,648 6,473 9,875 61,399 137,575 1,411 697,740

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13. PROPERTY, PLANT AND EqUIPMENT (CONT’D.)

Office Capital equipment, Land and Golf work-in- Motor furniture Plant and Other buildings* course progress vehicles and fittings machinery assets Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Accumulated depreciation and impairment lossesAt 1 March 2011 167,348 17,026 – 7,171 44,337 120,818 1,121 357,821Depreciation charge for the year 8,708 588 – 857 3,352 5,403 74 18,982Impairment loss reversed^ (70) (613) – – – – – (683)Disposals (2) – – (1,240) – (500) – (1,742)Write-offs (42) – – (8) (85) (1,561) – (1,696)Impairment loss 3,736 – – – – – – 3,736Reclassification – – – – (7) 7 – –Transfer to assets classified as held for sale (Note 27) (5,368) – – – – – – (5,368)

At 29 February 2012 174,310 17,001 – 6,780 47,597 124,167 1,195 371,050

Analysed as: Accumulated depreciation 67,171 7,963 – 6,780 47,567 124,035 1,195 254,711Accumulated impairment losses 107,139 9,038 – – 30 132 – 116,339

174,310 17,001 – 6,780 47,597 124,167 1,195 371,050

Net carrying amount 262,049 27,647 6,473 3,095 13,802 13,408 216 326,690

Group

At 28 February 2011

CostAt 1 March 2010 502,686 44,648 14,160 8,418 57,945 143,358 2,794 774,009Additions 1,456 – 6,285 1,804 3,588 1,743 73 14,949Disposals (17,922) – (415) (695) (592) (16,718) – (36,342)Write-offs (189) – – – (426) (289) (12) (916)Acquisition of subsidiaries (Note 19(b)) – – – – 7 – – 7 Reclassification 12,501 – (18,097) – (544) 7,586 (1,446) –Adjustment# (225) – – – – – – (225)

At 28 February 2011 498,307 44,648 1,933 9,527 59,978 135,680 1,409 751,482


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Office Capital equipment, Land and Golf work-in- Motor furniture Plant and Other buildings* course progress vehicles and fittings machinery assets Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Accumulated depreciation and impairment lossesAt 1 March 2010 173,274 19,473 – 7,155 41,501 131,029 1,839 374,271Depreciation charge for the year 9,049 524 – 695 4,208 5,163 151 19,790Impairment loss reversed^ (362) (2,971) – – – – – (3,333)Disposals (14,482) – – (678) (566) (16,427) – (32,153)Write-offs (152) – – – (374) (220) (9) (755)Acquisition of subsidiaries (Note 19(b)) – – – – 1 – – 1 Reclassification 21 – – (1) (433) 1,273 (860) –

At 28 February 2011 167,348 17,026 – 7,171 44,337 120,818 1,121 357,821

Analysed as:Accumulated depreciation 60,139 7,375 – 7,171 44,307 119,728 1,121 239,841 Accumulated impairment losses 107,209 9,651 – – 30 1,090 – 117,980

167,348 17,026 – 7,171 44,337 120,818 1,121 357,821

Net carrying amount 330,959 27,622 1,933 2,356 15,641 14,862 288 393,661

* Land and buildings

Long term leasehold Freehold Buildings land land Total RM’000 RM’000 RM’000 RM’000 Group

At 29 February 2012

CostAt 1 March 2011 387,691 30,463 80,153 498,307Additions 1,504 – – 1,504Disposals (2) – – (2)Write-offs (151) – – (151)Reclassification 73 – – 73Transfer to assets classified as held for sale (Note 27) (5,322) – (58,050) (63,372)

At 29 February 2012 383,793 30,463 22,103 436,359

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* Land and buildings (cont’d.)

Long term leasehold Freehold Buildings land land Total RM’000 RM’000 RM’000 RM’000

Accumulated depreciation and impairment lossesAt 1 March 2011 159,719 4,260 3,369 167,348Depreciation charge for the year 8,346 362 – 8,708Impairment loss reversed^ (70) – – (70)Disposals (2) – – (2)Write-offs (42) – – (42)Impairment loss – – 3,736 3,736Transfer to assets classified as held for sale (Note 27) (1,632) – (3,736) (5,368)

At 29 February 2012 166,319 4,622 3,369 174,310

Analysed as: Accumulated depreciation 65,050 2,121 – 67,171Accumulated impairment losses 101,269 2,501 3,369 107,139

166,319 4,622 3,369 174,310

Net carrying amount 217,474 25,841 18,734 262,049

Group

At 28 February 2011

CostAt 1 March 2010 388,038 30,463 84,185 502,686Additions 1,456 – – 1,456Disposals (13,890) – (4,032) (17,922)Write-offs (189) – – (189)Reclassification 12,501 – – 12,501Adjustment# (225) – – (225)

At 28 February 2011 387,691 30,463 80,153 498,307


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* Land and buildings (cont’d.)

Long term leasehold Freehold Buildings land land Total RM’000 RM’000 RM’000 RM’000

Accumulated depreciation and impairment lossesAt 1 March 2010 165,424 3,889 3,961 173,274Depreciation charge for the year 8,678 371 – 9,049Impairment loss reversed^ (362) – – (362)Disposals (13,890) – (592) (14,482)Write-offs (152) – – (152)Reclassification 21 – – 21

At 28 February 2011 159,719 4,260 3,369 167,348

Analysed as: Accumulated depreciation 58,380 1,759 – 60,139Accumulated impairment losses 101,339 2,501 3,369 107,209 159,719 4,260 3,369 167,348

Net carrying amount 227,972 26,203 76,784 330,959

Office equipment, furniture Motor and fittings vehicles Total Company RM’000 RM’000 RM’000

At 29 February 2012

CostAt 1 March 2011 and 29 February 2012 73 467 540

Accumulated depreciationAt 1 March 2011 62 464 526 Depreciation charge for the year 5 3 8

At 29 February 2012 67 467 534

Net carrying amount 6 – 6

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Office equipment, furniture Motor and fittings vehicles Total Company RM’000 RM’000 RM’000

At 28 February 2011

CostAt 1 March 2010 and 28 February 2011 73 467 540

Accumulated depreciationAt 1 March 2010 58 455 513 Depreciation charge for the year 4 9 13

At 28 February 2011 62 464 526

Net carrying amount 11 3 14

^ reversal of impairment loss has been made to increase the carrying value of the golf course to its estimated recoverable amount based on indicative valuations provided by an independent firm of valuers.

# relates to subsequent discounts given by a supplier.

(a) During the financial year, the Group acquired property, plant and equipment with an aggregate cost of RM976,000 (2011: RM4,064,000) by means of finance leases. The cashflow on acquisition of property, plant and equipment amounted to RM12,974,000 (2011: RM10,885,000).

The carrying amount of property, plant and equipment held under finance leases as at reporting date are as follows:


Motor vehicles 2,120 1,740 – 3 Plant and machinery 2,083 2,648 – – 4,203 4,388 – 3


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(b) The net carrying amounts of property, plant and equipment pledged as securities for borrowings (Note 33) are as follows:

Group 2012 2011 RM’000 RM’000

Freehold land 20,786 56,385 Leasehold land 1,639 1,671 Buildings 56,975 69,494 79,400 127,550

As at 29 February 2012, the property, plant and equipment with net carrying amounts of RM5,427,000 included above was classified as assets held for sale (Note 27(d)) and the charges are in the midst of being discharged by the bank.

(c) Included in the plant and machinery of the Group are staff costs capitalised amounting to RM328,000 (2011: RM556,000).

14. LAND HELD FOR PROPERTY DEVELOPMENT

Freehold Development land costs Total Group RM’000 RM’000 RM’000

At 29 February 2012

CostAt 1 March 2011 14,127 32,359 46,486 Additions – 4,450 4,450Disposals – (2,107) (2,107)Transfer to inventories (1,091) (34,702) (35,793)Transfer to assets classified as held for sale (Note 27) (9,197) – (9,197)

At 29 February 2012 3,839 – 3,839

Accumulated impairment losses At 1 March 2011 and 29 February 2012 3,534 – 3,534 Net carrying amount 305 – 305

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14. LAND HELD FOR PROPERTY DEVELOPMENT (CONT’D.)

Freehold Development land costs Total Group RM’000 RM’000 RM’000

At 28 February 2011

Cost At 1 March 2010 41,530 39,715 81,245 Additions – 7,439 7,439 Transfer to assets classified as held for sale (Note 27) (27,403) (14,795) (42,198)

At 28 February 2011 14,127 32,359 46,486

Accumulated impairment lossesAt 1 March 2010 and 28 February 2011 3,534 – 3,534

Net carrying amount 10,593 32,359 42,952

In the prior year, the freehold land under development with carrying value of RM17,296,000 has been pledged as security for borrowings (Note 33).

15. INVESTMENT PROPERTIES

Group 2012 2011 RM’000 RM’000

CostAt beginning of the year 143,497 142,683 Additions 42 1,069 Write-off – (255)

At end of the year 143,539 143,497

Accumulated depreciation and impairment lossesAt beginning of the year 74,568 71,035 Depreciation charge for the year 3,853 3,788 Write-off – (255)


Net carrying amount 65,118 68,929

Fair value 121,156 103,760

Direct operating expenses arising from investment properties included in income statement 4,879 4,094


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15. INVESTMENT PROPERTIES (CONT’D.)

The fair value of the investment properties as at 29 February 2012 was based on a valuation by an independent qualified valuer. Valuation was based on current prices in an active market for certain properties and where appropriate, the investment method reflecting receipt of contractual rentals, expected future market rentals, current market yields, void periods and maintenance requirements and approximate capitalisation rates is used.

Investment properties with net carrying amount of RM49,547,000 (2011: RM53,162,000) is situated on a land owned by a third party with whom the Group has an operating lease arrangement as disclosed in Note 38(b).

Investment properties with a net carrying amount of RM49,547,000 (2011: RM53,162,000) are pledged as securities for borrowings (Note 33).

16. LAND USE RIGHTS

Group 2012 2011 RM’000 RM’000

CostAt beginning of the year 30,572 30,620 Disposals – (48)


Accumulated amortisation and impairment losses At beginning of the year 9,201 9,288Amortisation for the year (Note 8) 649 702 Disposals – (22)Reversal of impairment losses (Note 5) (147) (767)


Analysed as: Accumulated amortisation 8,517 7,868Accumulated impairment losses 1,186 1,333

9,703 9,201

Net carrying amount 20,869 21,371

Amount to be amortised: - Not later than 1 year 649 702 - Later than 1 year but not later than 5 years 2,596 2,808 - Later than 5 years 17,624 17,861 20,869 21,371

In the prior year, the net carrying amount of land use rights pledged as securities for borrowings was RM12,251,000.

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17. BIOLOGICAL ASSETS

Group 2012 2011 RM’000 RM’000

CostAt beginning of the year 2,617 2,168 Additions 208 449 Amortisation for the year (Note 8) (66) –


During the current financial year, the biological assets have reached maturity, hence the cost is amortised over 25 years, the expected useful life of oil palm trees.

18. GOODWILL

Group 2012 2011 RM’000 RM’000

CostAt beginning and end of the year 28,462 28,462

Impairment tests for goodwill

Allocation of goodwill

Goodwill has been allocated to the Group’s cash-generating unit (“CGU”) identified according to business segment as follows:

Group 2012 2011 RM’000 RM’000

Trading of duty free goods and non-dutiable merchandise 27,408 27,408 Property and hospitality 1,054 1,054 28,462 28,462

Key assumptions used in value-in-use calculations

The recoverable amount of the CGU is determined based on value-in-use calculations using cash flow projections based on financial forecasts with key assumptions approved by management covering a 5-year period with a growth rate of approximately 5%. The forecasted growth rate used to extrapolate cash flow beyond the 5-year period is 1% (2011: 1%).


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18. GOODWILL (CONT’D.)

Key assumptions used in value-in-use calculations (cont’d.)

Key assumptions and management’s approach to determine the values assigned to each key assumption are as follows:

(i) Budgeted gross margin

The basis used to determine the value assigned to the budgeted gross margin is the average gross margin achieved in the year immediately before the budgeted year, increased for expected effiency improvements. The budgeted gross margin for trading of duty free goods and non-dutiable merchandise segment are in the range of 11% to 27% (2011: 11% to 27%) whereas for property and hospitality segment, it is 41% to 73% (2011: 40% to 69%).

(ii) Selling price

The selling price used to calculate the cash inflows from operations was determined after taking into consideration price trends of the industries in which the CGUs are exposed to. Value assigned are consistent with the external sources of information.

(iii) Discount rate

The discount rate applied to the cash flow projections of 8.0% (2011: 7.1%) is based on the weighted average cost of capital of a subsidiary, Duty Free International Limited.

Sensitivity to changes in assumptions

With regard to the assessment of value-in-use of all CGUs, the management believes that any reasonable change in any of the above key assumptions would not cause the carrying value of the CGUs to materially exceed their recoverable amounts.

19. INVESTMENT IN SUBSIDIARIES

Company 2012 2011 RM’000 RM’000

Quoted equity instruments, at cost Outside Malaysia 784,367 784,367 Unquoted shares, at cost 447,492 437,622 1,231,859 1,221,989 Less: Accumulated impairment losses (19,793) (5,352)

1,212,066 1,216,637

Market value of quoted equity instruments: Outside Malaysia 514,840 796,564

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19. INVESTMENT IN SUBSIDIARIES (CONT’D.)

(a) Details of the subsidiaries, which were incorporated in Malaysia (unless otherwise indicated), as at 29 February 2012, are as follows:

Proportion ofName of Company ownership interest 2012 2011 Principal activities % %

Arah Induk Sdn. Bhd. 100 100 Dormant Atlan Properties Sdn. Bhd. 100 100 Investment holding Atlan Technology Sdn. Bhd. 100 100 Dormant Atlan Orient Sdn. Bhd. 100 100 Dormant

Principal Assets Pte. Ltd. 100 100 Dormant (Incorporated in Federal Territory of Labuan) *

Seven Wonders Of The World 100 100 Dormant Sdn. Bhd. Naluri Corporation Berhad 58 58 Investment holding Naluri Properties Sdn. Bhd. 100 100 Property investment, general construction and apartment hotel business Duty Free International Limited 81 81 Investment holding (“DFI”) (Incorporated in Singapore) +^ United Industries Holdings Sdn. Bhd. 100 100 Investment holding MHS Land Sdn. Bhd. 51 51 Investment holding Zon Hospitality Services Sdn. Bhd. 100 100 Provision of hospitality management and related services Blossom Time Sdn. Bhd. 100 100 Property development Timeless Image Sdn. Bhd. 100 100 Investment holding International Aviation Consultants 100 100 Dormant Sdn. Bhd. RZ Equities Sdn. Bhd. 100 100 Dormant Trifiniti Networks Sdn. Bhd. 100 100 Dormant Atlan Assets Sdn. Bhd. 100 100 Dormant

Atlan Management Sdn. Bhd. 100 100 Providing various administration, advisory, management, planning, functions and assistance to its holding company and related companies


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(a) Details of the subsidiaries, which were incorporated in Malaysia (unless otherwise indicated), as at 29 February 2012, are as follows: (cont’d.)

Proportion of Name of Company ownership interest 2012 2011 Principal activities % %

Atlan Development Sdn. Bhd. 100 100 Dormant

Atlan Capital Sdn. Bhd. 100 100 Dormant

Ocean Pride Sdn. Bhd. 100 100 Dormant

Tegapasti Sdn. Bhd. 100 100 Dormant Belia Karisma Sdn. Bhd. 100 100 Dormant Radiant Ranch Sdn. Bhd. 100 100 Dormant Gardenia Success Sdn. Bhd. 100 – Dormant Tropika Ferringhi Management 100 – Dormant Sdn. Bhd.

Held through Atlan Properties Sdn. Bhd.

Naluri Corporation Berhad 38 38 Investment holding

Held through Belia Karisma Sdn. Bhd.

Naluri International Limited 50 50 Investment holding (Incorporated in Hong Kong) #

Held through Atlan Assets Sdn. Bhd. Naluri International Limited 50 50 Investment holding (Incorporated in Hong Kong) #

Held through MHS Land Sdn. Bhd. Gardenia Success Sdn. Bhd. – 51 Dormant

Held through Naluri International Limited

TRIM Capital Management (M) Sdn. Bhd. 100 100 Dormant

87





Held through DFI DFZ Capital Berhad (“DFZ”) 81 80 Investment holding

Darul Metro Sdn. Bhd. 81 81 Letting out properties

Held through DFZ

DFZ Trading Sdn. Bhd. 81 80 Investment holding and management services

Orchard Boulevard Sdn. Bhd. 81 80 Investment holding and resort development Selasih Ekslusif Sdn. Bhd. 81 80 Retailer of duty free merchandise and operation of a supermarket and department store

Winner Prompt Sdn. Bhd. 81 80 Licensed distributor and wholesaler of duty free merchandise

DFZ Asia Sdn. Bhd. 81 80 Investment holding Emas Kerajang Sdn. Bhd. 81 80 Retailer of duty free and non-dutiable merchandise Seruntun Maju Sdn. Bhd. 81 80 Retailer of duty free and non-dutiable merchandise Binamold Sdn. Bhd. 81 80 Property investment Tenggara Senandung Sdn. Bhd. 81 80 Operator of ferry terminal, car park and trading of high speed diesel

Held through DFZ Trading Sdn. Bhd. DFZ Duty Free Supplies Sdn. Bhd. 81 80 Wholesaler and distributor of duty free and non-dutiable merchandise

Cergasjaya Sdn. Bhd. 81 80 Wholesaler and retailer of duty free and non-dutiable merchandise

Jelita Duty Free Supplies Sdn. Bhd. 81 80 Wholesaler and distributor of duty free and non-dutiable merchandise


88





Held through DFZ Trading Sdn. Bhd. (cont’d.)

Jasa Duty Free Sdn. Bhd. 81 80 Retailer of duty free and non-dutiable merchandise

DFZ (M) Sdn. Bhd. 81 80 Retailer of duty free and non-dutiable merchandise

DFZ Emporium Sdn. Bhd. 81 80 Retailer of duty free and non-dutiable merchandise

DFZ Duty Free (Langkawi) 81 80 Retailer of duty free and Sdn. Bhd. non-dutiable merchandise

Wealthouse Sdn. Bhd. 81 80 Retailer of duty free and non-dutiable merchandise

Melaka Duty Free Sdn. Bhd. 41 41 Retailer of duty free and non-dutiable merchandise

Zon Emporium Sdn. Bhd. 81 80 Retailer of duty free and non-dutiable merchandise

Media Zone Sdn. Bhd. 81 80 Advertising, promotion activities and investment holding

DFZ Tours & Travel Sdn. Bhd. 81 80 Investment holding, tours and travel activities

First Influx Sdn. Bhd. 81 80 Licensed distributor and wholesaler of duty free merchandise

Held through Orchard Boulevard Sdn. Bhd.

Gold Vale Development Sdn. Bhd. 81 80 Property investment

Black Forest Golf And Country 81 80 Golf and country club operator and Club Sdn. Bhd. a wholesaler and retailer of duty free and non-dutiable merchandise

Cergasjaya Properties Sdn. Bhd. 81 80 Resort development, properties management and cultivation of oil palm Kelana Megah Sdn. Bhd. 81 80 Resort development and operating of duty free complex and hotel

89





Held through Emas Kerajang Sdn. Bhd. Front Top (M) Sdn. Bhd. 81 80 Dormant Held through DFZ Tours & Travel Sdn. Bhd. Fleet Car Hire & Tours Sdn. Bhd. 81 80 Dormant Held through DFZ Emporium Sdn. Bhd. PT DFZ Indon 80 79 Dormant (Incorporated in Republic of Indonesia) # Held through DFZ Asia Sdn. Bhd. PT DFZ Indon 1 1 Dormant (Incorporated in Republic of Indonesia) #

Held through United Industries Holdings Sdn. Bhd. United Industries Sdn. Bhd. 100 100 Manufacturing and marketing of exhaust systems and other automotive component parts

United Vehicles Industries Sdn. Bhd. 81 81 Manufacturing and marketing of fuel tanks, other automotive component parts and wheelbarrows

United Sanoh Industries Sdn. Bhd. 70 70 Manufacturing and distribution of brake, fuel and clutch tubings and other automotive component parts

United Filter Sdn. Bhd. 28 28 Manufacturing and marketing of automotive and industrial filters and filter housing

Held through United Industries Sdn. Bhd.

UEW Plastic Industries Sdn. Bhd. 100 100 Dormant Freighter Industries (M) Sdn. Bhd. 100 100 Dormant


90





Held through United Industries Sdn. Bhd. (cont’d.)

Danco Marketing Sdn. Bhd. 100 100 Selling and distribution of exhaust systems, filters, other automotive replacement parts and wheelbarrows

United Filter Sdn. Bhd. 69 69 Manufacturing and marketing of automotive and industrial filters and filter housing

United Vehicles Industries Sdn. Bhd. 19 19 Manufacturing and marketing of fuel tanks, other automotive component parts and wheelbarrows

Held through United Vehicles Industries Sdn. Bhd.

Kadar Prisma Sdn. Bhd. 100 100 Property investment (Dormant)

UVI Advance Technology Sdn. Bhd. 100 100 Manufacturing of plastic fuel tanks

* Based on unaudited financial statements+ A corporation listed on Singapore Stock Exchange (“SGX-ST”)^ Audited by member firm of Ernst & Young Global in Singapore# Audited by a firm other than Ernst & Young

(b) Acquisition of subsidiaries

In prior year, the Company acquired DFI as part of a reorganisation initiative.

In the prior year, the acquired subsidiary has contributed the following results to the Group:

2011 RM’000

Revenue 57 Loss for the year (7,988)

91



(b) Acquisition of subsidiaries (cont’d.)

In the prior year, the identifiable assets and liabilities arising from the acquisition were as follows:

2011 Fair value/ Carrying amount RM’000

Property, plant and equipment (Note 13) 6 Trade and other receivables 316 Cash and cash equivalents 89

411 Trade and other payables (7,374)

Net identifiable liabilities (6,963)

Fair value of net liabilities (6,701)Non-controlling interests (262)

(6,963)Deemed cost of acquisition (29,230)

Cost of acquisition and reorganisation (36,193)

Analysis of cost of acquisition and reorganisation charged to income statement

2011 RM’000 Cost of acquisition and reorganisation 36,193 Cost of issuance of warrants to external investors 4,303 40,496

Total cash inflow for acquisition is as follows:

2011 RM’000

Cash and cash equivalent in subsidiary acquired 89

There is no cash inflow or outflow for acquisition of DFI, other than the cash and cash equivalents acquired.


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20. INVESTMENT IN ASSOCIATE


Unquoted shares in Malaysia, at cost 437 437 437 437 Shares of post acquisition results 22 – – –

459 437 437 437

Represented by:Share of net assets of associate 459 437 437 437

The share of post acquisition results of the associate is based on the share of results, which is arrived at from the last audited financial statements available and management financial statements drawn up to the same reporting date of the Company.

The particulars of the associate, which is incorporated in Malaysia, are as follows:

Proportion of Name of Company ownership interest

2012 2011 Principal activities % %

Scandinavian Avionics (Malaysia) 25 25 Sale of aviation related electrical Sdn. Bhd. # instruments and the provision of avionics support services

# Audited by a firm other than Ernst & Young

The summarised financial information of the associate, not adjusted for the proportion of ownership interest held by the Group, is as follows:

Group 2012 2011 RM’000 RM’000

Assets and liabilities Total assets 2,961 2,579 Total liabilities 1,125 831

Results Revenue 6,492 4,262 Profit/(loss) for the year 88 (112)

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21. OTHER INVESTMENTS

Group 2012 2011 RM’000 RM’000

Unquoted shares at cost - in Malaysia 21 21 - outside Malaysia 3,688 3,688

3,709 3,709 Less: Accumulated impairment losses (3,688) (3,688)

21 21 Corporate golf club and vacation club memberships 141 141 Less: Accumulated amortisation (12) (12)

150 150

22. TRADE AND OTHER RECEIVABLES


CurrentTrade receivablesThird parties 36,290 39,393 – –Less: Allowance for impairment (595) (3,151) – – 35,695 36,242 – –

Other receivablesDue from subsidiaries – – 335,606 437,537 Less: Allowance for impairment – – (166,834) (162,720)

– – 168,772 274,817

Deposits 3,187 3,021 3 3Advances to contractors 3,000 6,884 – –Staff loans 128 198 – –Due from stakeholders 660 – – –Sundry receivables 9,943 8,593 – –

16,918 18,696 3 3 Less: Allowance for impairment (995) (2,934) – –

Other receivables, net 15,923 15,762 3 3

Total current trade and other receivables, net 51,618 52,004 168,775 274,820

Non-currentOther receivablesStaff loans 63 253 – –


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22. TRADE AND OTHER RECEIVABLES (CONT’D.)


Total trade and other receivables (current and non-current) 51,681 52,257 168,775 274,820Add: Cash and bank balances (Note 26) 118,256 136,805 39,148 6,683

Total loans and receivables 169,937 189,062 207,923 281,503

Trade receivables

Trade receivables are non-interest bearing and are generally on 14 to 120 days’ (2011: 14 to 120 days’) terms. Other credit terms are assessed and approved on a case-by-case basis. Trade receivables are recognised at their original invoice amounts which represent their fair values on initial recognition.

Related party balances

The amounts owing from subsidiaries are unsecured and are recoverable on demand. The interest bearing and non-interest bearing amounts are as follows:

Company 2012 2011 RM’000 RM’000

Interest bearing 117,335 187,357Non-interest bearing 51,437 87,460

Total 168,772 274,817

The effective interest is 5.0% (2011: 5.0%) per annum.

Advances to contractors Advances to contractors are non-interest bearing and are for on-going construction projects of a subsidiary.

Subsequent to the financial year end, these advances were settled.

Staff loans

Staff loans are unsecured and bear interest at 2.0% (2011: 2.0%) per annum. Non-current amounts have an average maturity of 1.2 years (2011: 2.2 years).

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Ageing analysis of trade receivables

The ageing analysis of the Group’s trade receivables is as follows:

Group 2012 2011 RM’000 RM’000

Neither past due nor impaired 27,177 26,863

1 to 30 days past due not impaired 2,343 7,172 31 to 60 days past due not impaired 2,214 1,800 61 to 90 days past due not impaired 2,015 109 91 to 120 days past due not impaired 1,785 196 More than 120 days past due not impaired 161 102 8,518 9,379Impaired 595 3,151

36,290 39,393

Receivables that are neither past due nor impaired

Trade and other receivables that are neither past due nor impaired are creditworthy debtors with good payment records with the Group.

None of the Group’s trade receivables that are neither past due nor impaired have been renegotiated during the financial year.

Trade receivables that are impaired

The Group’s trade receivables that are impaired at the reporting date and the movement of the allowance accounts used to record the impairment are as follows:

Group 2012 2011 RM’000 RM’000

Individually impairedTrade receivables - nominal amounts 595 3,151 Less: Allowance for impairment (595) (3,151)

– –

Movement in allowance accounts: Group 2012 2011 RM’000 RM’000

At beginning of the year 3,151 7,145 Charge for the year 54 173 Written off (2,607) (3,960)Reversal of impairment losses (3) (103)Reclassification to other receivables – (104)

At end of the year 595 3,151


96



Trade receivables that are impaired (cont’d.)

Trade receivables that are individually determined to be impaired at the balance sheet date relate to debtors that are in legal dispute or financial difficulties, and have defaulted on payments. These receivables are not secured by any collateral or credit enhancements.

Other receivables that are impaired

Other receivables that are impaired at the reporting date and the movement of the allowance accounts used to record the impairment are as follows:

Company 2012 2011 Restated RM’000 RM’000

Individually impairedDue from subsidiaries - nominal amounts 282,115 307,953 Less: Allowance for impairment (166,834) (162,720)

115,281 145,233

Group 2012 2011 RM’000 RM’000

Individually impairedSundry receivables - nominal amounts 995 2,934 Less: Allowance for impairment (995) (2,934)

– –

Movement in allowance accounts:


At beginning of the year 2,934 10,849 162,720 116,389 Charge for the year 469 36 4,114 46,369 Reversal of impairment losses – – – (38)Written off (2,408) (8,055) – –Reclassification from trade receivables – 104 – –

At end of the year 995 2,934 166,834 162,720

Sundry receivables that are individually determined to be impaired at the balance sheet date relate to debtors that are in legal dispute or financial difficulties, and have defaulted on payments. These receivables are not secured by any collateral or credit enhancements.

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23. DEFERRED TAX

Group 2012 2011 RM’000 RM’000

At beginning of the year 2,797 1,443 Recognised in profit or loss (Note 10) (487) 1,354 At end of the year 2,310 2,797

Presented after appropriate offsetting as follows:

Deferred tax assets (6,646) (6,353)Deferred tax liabilities 8,956 9,150 2,310 2,797

The components and movements of deferred tax liabilities and assets during the year prior to offsetting are as

follows:

Deferred tax liabilities of the Group:

Property, plant and Revaluation equipment surplus Total RM’000 RM’000 RM’000

At 1 March 2010 1,320 7,729 9,049 Recognised in income statement 1,059 (217) 842 At 28 February 2011 and 1 March 2011 2,379 7,512 9,891 Recognised in income statement 4 (186) (182)

At 29 February 2012 2,383 7,326 9,709

Deferred tax assets of the Group:

Unutilised tax losses and unabsorbed capital allowances Others Total RM’000 RM’000 RM’000 At 1 March 2010 (6,249) (1,357) (7,606)Recognised in income statement 427 85 512 At 28 February 2011 and 1 March 2011 (5,822) (1,272) (7,094)Recognised in income statement (24) (281) (305)

At 29 February 2012 (5,846) (1,553) (7,399)


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23. DEFERRED TAX (CONT’D.)

Deferred tax assets have not been recognised in respect of the following items:


Unabsorbed capital allowances 46,670 53,461 818 818 Unabsorbed reinvestment allowances 10,912 9,073 – –Unutilised tax losses 234,954 279,122 – –Other deductible temporary differences 40,747 45,229 – –

333,283 386,885 818 818

Deferred tax assets have not been recognised in respect of these items as they may not be used to offset taxable profits of other subsidiaries in the Group and they have been risen in subsidiaries that have insufficient profits to fully utilise these unabsorbed capital allowances, unabsorbed reinvestment allowances, unutilised tax losses and other deductible temporary differences in the foreseeable future.

The deferred tax assets attributable to unabsorbed capital allowances, unabsorbed reinvestment allowances, unutilised tax losses and other deductible temporary differences are available for offsetting against future taxable profits subject to no substantial change in shareholdings under the Income Tax Act, 1967 and guidelines issued by the tax authority.

24. INVENTORIES

Group 2012 2011 RM’000 RM’000

Cost Food and beverages 558 692 Raw materials 12,778 10,566Work in progress 3,912 3,122 Trading goods 137,823 113,594 Finished goods 2,405 1,667 Completed development properties 34,564 1,180 Consumables 370 352 192,410 131,173

During the year, the amount of inventories recognised as an expense in the income statement was RM472,056,000 (2011: RM492,944,000).

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25. MARKETABLE SECURITIES

Group 2012 2011

Market value Market value Carrying of quoted Carrying of quoted amount investments amount investments RM’000 RM’000 RM’000 RM’000

Held for trading investmentsEquity instruments - quoted in Malaysia 17 33 17 33 - quoted outside Malaysia 1,408 1,408 3,970 3,970 Total marketable securities 1,425 1,441 3,987 4,003

Company 2012 2011

Market value Market value Carrying of quoted Carrying of quoted amount investments amount investments RM’000 RM’000 RM’000 RM’000

Held for trading investmentsEquity instruments - quoted outside Malaysia 1,408 1,408 3,970 3,970 Total marketable securities 1,408 1,408 3,970 3,970

Changes in fair value

During the financial year, the Group and the Company have recognised changes in fair value amounting to RM2,576,000 (2011: RM237,000) in regard to the equity instruments quoted outside Malaysia as there was a decrease (2011: increase) in the fair value of these investments.

26. CASH AND BANK BALANCES


Cash on hand and at banks 16,375 44,694 276 483 Deposits with licensed banks 101,881 92,111 38,872 6,200

118,256 136,805 39,148 6,683

Cash at banks earns interest at floating rates based on daily bank deposit rates. Deposits with licensed banks are made for varying periods of between one day and fifteen months depending on the immediate cash requirements of the Group and of the Company, and earn interest at the respective deposit rates. The effective interest rates for the Group and the Company were 1.65% to 3.40% (2011: 1.65% to 2.66%) per annum and 2.20% to 3.40% (2011: 2.20%) per annum, respectively.

Deposits with licensed banks of the Group amounting to RM10,975,000 (2011: RM11,029,000) are pledged to banks for credit facilities granted to certain subsidiaries as disclosed in Note 33.


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26. CASH AND BANK BALANCES (CONT’D.)

For the purpose of the statements of cash flow, cash and cash equivalents comprise the following as at the reporting date:


Cash on hand and at banks 16,375 44,694 276 483 Deposits with licensed banks 101,881 92,111 38,872 6,200 118,256 136,805 39,148 6,683 Bank overdrafts (Note 33) (2,032) (3,348) – –

Cash and cash equivalents 116,224 133,457 39,148 6,683

27. ASSETS CLASSIFIED AS HELD FOR SALE

Group 2012 2011 RM’000 RM’000

Land held for property development ((a), (b), Note 14) 9,197 42,198Property, plant and equipment ((c), (d), Note 13) 58,004 –

67,201 42,198

(a) On 19 November 2010, Blossom Time Sdn. Bhd. and Radiant Ranch Sdn. Bhd., both wholly-owned subsidiaries of the Company, have entered into two separate conditional Sale and Purchase Agreements with Utara Malaya Realty Sdn. Bhd. for the proposed disposal of lands for a total cash consideration of RM145.0 million. As at 28 February 2011, the proposed disposal has not been completed and the net book value of the lands and its related expenditure was classified as assets held for sale. On 30 May 2011, the above proposed disposal was completed.

(b) On 17 March 2011, the Board of Directors (“Board”) of the Company announced that a wholly-owned subsidiary of the Company, Tegapasti Sdn. Bhd., has entered into a conditional Sale and Purchase Agreement to dispose two pieces of freehold land in Batu Ferringhi, Penang to Glass Bay Sdn. Bhd. for a total cash consideration of RM33.0 million, subject to and upon the terms and conditions in the conditional Sale and Purchase Agreement. As at 29 February 2012, the proposed disposal has not been completed and the net book value of the lands and its related expenditure was classified as assets held for sale.

(c) On 29 September 2011, the Board of the Company announced that a wholly owned subsidiary of the Company, Gardenia Success Sdn. Bhd., has entered into a conditional Sale and Purchase Agreement to dispose off two parcels of freehold vacant commercial development land both located in township of Bandar Sri Sendayan, Daerah Seremban, State of Negeri Sembilan Darul Khusus to BSS Development Sdn. Bhd. for a total cash consideration of RM52.3 million, subject to and upon the terms and conditions in the conditional Sale and Purchase Agreement. As at 29 February 2012, the proposed disposal has not been completed and the net book value of the lands was classified as assets held for sale.

(d) DFZ Duty Free Supplies Sdn. Bhd. (“DSSB”), a wholly-owned subsidiary of DFI, owns two adjoining pieces of lands located in Seberang Perai Tengah, Pulau Pinang, together with a warehouse erected thereon (“DSSB Property”).

In current financial year, management actively marketed the DSSB Property, which is ready for sale in its present condition. As at 29 February 2012, management assessed that the disposal is highly probable and the carrying amount of the said warehouse of RM5.7 million was reclassified to assets held for sale. On 1 March 2012, DSSB entered in a conditional sales and purchase agreement with an external party to dispose the DSSB Property for a cash consideration of RM14.0 million.

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28. SHARE CAPITAL, SHARE PREMIUM AND TREASURY SHARES

Number of ordinary Amount share of RM1 each Total Share Share share capital capital capital (Issued and Treasury (Issued and Share and share Treasury fully paid) shares fully paid) premium premium shares ‘000 ‘000 RM’000 RM’000 RM’000 RM’000Group and Company

At 1 March 2010 253,650 12,331 253,650 136,047 389,697 (35,230)Purchase of treasury shares – 1,318 – – – (4,569)Treasury shares distributed as dividends – (12,000) – (34,988) (34,988) 34,988

At 28 February 2011 and 1 March 2011 253,650 1,649 253,650 101,059 354,709 (4,811)Purchase of treasury shares – 1 – – – (4)

At 29 February 2012 253,650 1,650 253,650 101,059 354,709 (4,815)

Group/Company Number of shares of RM 1 each Amount

2012 2011 2012 2011 ‘000 ‘000 RM’000 RM’000

Authorised:Ordinary shares 900,000 900,000 900,000 900,000 Preference shares 100,000 100,000 100,000 100,000 1,000,000 1,000,000 1,000,000 1,000,000

Share capital

The holders of ordinary shares (except treasury shares) are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share without restrictions and rank equally with regard to the Company residual assets.

Treasury shares

Treasury shares relate to ordinary shares of the Company that are held by the Company. The amount consists of the acquisition costs of treasury shares net of the proceeds received on their subsequent sale or issuance.

The Company acquired 1,000 (2011: 1,318,600) shares in the Company through purchases on the Bursa Malaysia Securities Berhad during the financial year. The total amount paid to acquire the shares was RM4,000 (2011: RM4,569,000) and this was presented as a component within shareholders’ equity.

The directors of the Company are committed to enhancing the value of the Company for its shareholders and

believe that the repurchase plan can be applied in the best interests of the Company and its shareholders. The repurchase transactions were financed by internally generated funds. The shares repurchased are being held as treasury shares.


102


28. SHARE CAPITAL, SHARE PREMIUM AND TREASURY SHARES (CONT’D.)

Treasury shares (cont’d.)

As at 29 February 2012, the Company held as treasury shares a total of 1,649,649 (2011: 1,648,649) of its issued ordinary shares.

In prior year, the Company distributed 12,000,474 treasury shares, amounting to RM34,988,000, as share dividends on the basis of one treasury share for every existing twenty ordinary shares of RM1 each to shareholders of the Company.

Subsequent to the financial year ended 29 February 2012, the Company had resold 1,649,600 treasury shares on the Bursa Malaysia Securities Berhad for a total consideration of RM6,634,000. The remaining 49 treasury shares were cancelled on 11 May 2012. After the resale and cancellation of the treasury shares, the Company no longer holds any treasury shares in its books.

29. ISSUANCE OF WARRANTS

Issuance of warrants relates to the fair value at initial recognition of warrants issued by DFI to advisers pursuant to acquisition and reorganisation exercise and mandatory general offer for DFZ shares. The warrants are exercisable at anytime at SGD0.35 per warrant within five years from date of issuance. As at 29 February 2012, there are 34,976,000 outstanding warrants to non-controlling interests (2011: 34,873,000 warrants).

30. OTHER RESERVE

Group 2012 2011 RM’000 RM’000

At beginning of the year (19,944) (7,782)Acquisition of a subsidiary – 18,917 Dilution of equity interest in subsidiaries (Note 46(b)) (2,636) (31,079)

At end of the year (22,580) (19,944)

Other reserve arises from changes in the Group’s equity interest in subsidiaries.

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 dividends 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 108 balance and opt to 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 has elected for the irrevocable option to disregard the Section 108 balance. The Company may distribute dividends out of its entire retained earnings as at 29 February 2012 under the single tier system.

103


32. EMPLOYEE BENEFITS

Group 2012 2011 RM’000 RM’000

Present value of unabsorbed obligations 3,402 3,140 Recognised liability for defined benefit obligations 3,402 3,140

Analysed as: Non-current Later than 1 year but not later than 2 years 148 136 Later than 2 years but not later than 5 years 858 707 Later than 5 years 2,232 2,145 3,238 2,988

Current 164 152

3,402 3,140

(a) Liability for defined benefit obligations

The Group’s defined benefit plan is unfunded and it provides retirement benefits for employees upon retirement on the account of medical grounds and for employees upon passed away while under employment. The retirement benefits are only applicable to employees who are in the National Union of Transport Equipment and Allied Industries Workers.

Under the plan, eligible employees are entitled to retirement benefits of one, two, three and four weeks’ of last drawn salary based on the length of service upon the retirement age of 55. Eligible employees also have the option to retire at the age of 50.

(b) Movement in the net liability recognised in the balance sheet:

Group 2012 2011 RM’000 RM’000

At beginning of the year 3,140 2,836 Expense recognised in the income statement 527 419 Benefits paid (265) (115)


(c) Expense recognised in the income statement:

Group 2012 2011 RM’000 RM’000

Current service cost 248 264 Interest on obligation 229 224 Reversal – (148)Actuarial losses 50 79

527 419


104


32. EMPLOYEE BENEFITS (CONT’D.)

(d) The expense is recognised in the following line item in the income statement:

Group 2012 2011 RM’000 RM’000

Employee benefits expense (Note 6) 527 419

(e) Principal actuarial assumptions used at the balance sheet date (expressed as weighted averages):

Group 2012 2011

% % Discount rate 6.0 6.0 Future salary increases 6.0 6.0 Price inflation 3.5 3.5

33. BORROWINGS

Group Company 2012 2011 2012 2011 Maturity RM’000 RM’000 RM’000 RM’000

CurrentSecured:Obligations under finance leases 2013 1,548 1,496 5 5 Bankers’ acceptance 2013 9,943 12,645 – –Bank overdrafts On (Note 26) demand 2,032 3,348 – –USD trade loans 2013 10,663 – – –Term loans- syndicated term loans 2012 – 8,000 – 8,000 - loan at discount rate 2013 50,000 50,000 – –- loan at coupon rate 2012 – 24,000 – –- SGD bank loan at SIBOR +0.75% per annum 2013 28,895 26,381 – –- 4% per annum fixed rate bank loan 2012 – 31 – –Interest payable 2013 17 180 – –

103,098 126,081 5 8,005Unsecured:Interest payable 2013 80 80 – – 103,178 126,161 5 8,005

105


33. BORROWINGS (CONT’D.)

Group Company 2012 2011 2012 2011 Maturity RM’000 RM’000 RM’000 RM’000

Non-currentSecured:Obligations under finance 2014 - leases 2017 1,637 2,458 13 18 Term loans- syndicated term loans 2016 118,000 210,000 118,000 210,000- business financing-i loan 2015 – 30,000 – – 119,637 242,458 118,013 210,018

Total borrowings 222,815 368,619 118,018 218,023

Total borrowingsObligations under finance leases (Note 34) 3,185 3,954 18 23 Bankers’ acceptance 9,943 12,645 – –Bank overdrafts 2,032 3,348 – –USD trade loans 10,663 – – –Term loans 196,895 348,412 118,000 218,000

222,718 368,359 118,018 218,023Interest payable 97 260 – –

Total borrowings 222,815 368,619 118,018 218,023

Maturity of borrowings(excluding obligations under finance leases)

Not later than 1 year 101,630 124,665 – 8,000Later than 1 year and not later than 5 years 118,000 240,000 118,000 210,000

219,630 364,665 118,000 218,000

The borrowings are secured by way of:

- fixed charges on certain properties of the Group with a net carrying amount of RM128,947,000 (2011: RM210,259,000);

- deposits with licensed banks amounting to RM10,975,000 (2011: RM11,029,000);- fixed and floating charges over all present and future assets of certain subsidiaries; and- corporate guarantees by the Company and by certain subsidiaries of the Group.

Obligations under finance leases

These obligations are secured by a charge over the leased assets (Note 13). The average discount rate implicit in the leases of the Group and of the Company is 2.87% (2011: 3.04%) per annum and 4.30% (2011: 4.30%) per annum, respectively.


106


33. BORROWINGS (CONT’D.)

Bankers’ acceptance

Bankers’ acceptances are denominated in RM with weighted average effective interest rate of 4.18% (2011: 3.59%) per annum.

Bank overdrafts

Bank overdrafts are denominated in RM, bear interest between BLR + 1.0% per annum and BLR + 1.5% per annum.

USD trade loans

These trade loans are denominated in USD and are due in the next financial year. The average interest rate for the loans ranged from 1.60% to 1.90% per annum.

Syndicated term loans

Syndicated term loans consists of bank facilities from three financial institutions as detailed below:

- Term loan facility at BLR + 1% per annum;

- Ijarah Facility I at BFR +1% per annum;

- Ijarah Facility II at BFR +1% per annum.

The syndicated term loans are secured by certain buildings and investment properties of the Group, and assignment of certain tenancy agreement.

Loan at discount rate

This loan is due in the next financial year. The average discount rate for the loan ranged from 4.30% to 4.60% (2011: 4.60% to 5.55%) per annum.

Loan at coupon rate

This loan was fully repaid on 25 January 2012. The average coupon rate for the loan was 7.90% per annum.

SGD bank loan at SIBOR + 0.75% per annum

This loan is denominated in SGD and is secured by a bank guarantee of SGD12,000,000 and shares of a subsidiary. The repayment of this loan is due on 23 March 2012.

4% per annum fixed rate bank loan

The loan was fully settled and was secured by certain freehold land of the Group.

Business financing-i loan

The loan was fully settled and was secured by certain freehold land of the Group. The profit rate was 6-month cost of funds plus 2.0% per annum.

107


34. OBLIGATIONS UNDER FINANCE LEASES


Future minimum lease payments:Not later than 1 year 1,725 1,689 6 6 Later than 1 year and not later than 5 years 1,680 2,613 14 21

Total future minimum lease payments 3,405 4,302 20 27 Less: Future finance charges (220) (348) (2) (4)

Present value of finance lease liabilities (Note 33) 3,185 3,954 18 23

Analysis of present value of finance lease liabilities:Not later than 1 year 1,548 1,496 5 5 Later than 1 year and not later than 5 years 1,637 2,458 13 18

3,185 3,954 18 23Less: Amount due within 12 months (1,548) (1,496) (5) (5)

Amount due after 12 months 1,637 2,458 13 18

35. TRADE AND OTHER PAYABLES


Trade payablesThird parties 72,392 80,937 – –Retention sums 934 1,588 – –

73,326 82,525 – –

Other payablesDue to subsidiaries – – 430,477 430,195 Sundry payables 14,701 15,834 744 3,069 Accruals 14,141 17,281 – 130 Deposits payable 7,322 6,189 – –Rental payable 3,351 2,627 – –Royalty payable 907 872 – –Deposits received for proposed disposals 16,227 – – –Contribution cost payable 209 209 – –

56,858 43,012 431,221 433,394

Total trade and other payables 130,184 125,537 431,221 433,394 Add: Borrowings (Note 33) 222,815 368,619 118,018 218,023

Total financial liabilities carried at amortised cost 352,999 494,156 549,239 651,417


108


35. TRADE AND OTHER PAYABLES (CONT’D.)

Trade payables

The amounts are non-interest bearing. The credit terms of trade payables normally range from 30 to 120 days (2011: 30 to 120 days).

Related party balances

The amount due to subsidiaries are unsecured, non-interest bearing and are repayable on demand.

Other payables

The amounts are non-interest bearing. Sundry payables are normally settled on an average term of 30 to 120 days (2011: 30 to 120 days).

36. DERIVATIVE LIABILITIES

Contract/ Nominal

Amount Assets Liabilities RM’000 RM’000 RM’000 Group

At 29 February 2012Forward foreign exchange contracts 13,595 – 95

At 28 February 2011Forward foreign exchange contracts 7,644 – 8

The Group uses forward foreign currency contracts to manage some of its transaction exposure. These contracts are not designated as cash flow or fair value hedges and are entered into for periods consistent with currency translation exposure and fair value changes exposure. Such derivatives do not qualify for hedge accounting.

37. PROVISIONS


Provision for litigation 4,000 4,000 4,000 4,000 Provision for guarantees 12,554 12,992 – –Provision for liquidated ascertained damages 547 547 – –

17,101 17,539 4,000 4,000

109


37. PROVISIONS (CONT’D.)

The movement of provision is as follows:

Provision for liquidated Provision for Provision for ascertained litigation guarantees damages Total RM’000 RM’000 RM’000 RM’000Group At 1 March 2010 31,635 14,209 547 46,391Unrealised foreign exchange difference – (1,217) – (1,217)Reversal (Note 5) (27,635) – – (27,635)

At 28 February 2011 and 1 March 2011 4,000 12,992 547 17,539Unrealised foreign exchange difference – (438) – (438)

At 29 February 2012 4,000 12,554 547 17,101

Provision for litigation RM’000Company

At 1 March 2010 31,635Reversal (Note 5) (27,635)

At 28 February 2011 and 29 February 2012 4,000

(a) Provision for litigation

The provision for litigation is in respect of certain on-going litigation cases in the Group and in the Company.

(b) Provision for guarantees

These guarantees are denominated in Deutschemark which are equivalent to Euro 3.1 million in respect of the Group for credit facilities granted by a financial institution to an investment company, ACL Advanced Cargo Logistic GmbH.

(c) Provision for liquidated ascertained damages

Provision for liquidated ascertained damages is in respect of projects undertaken by a subsidiary. The provision is recognised for expected liquidated ascertained damages claims based on the terms of the applicable sale and purchase agreements.


110


38. COMMITMENTS

(a) Capital commitments

Group 2012 2011 RM’000 RM’000

Capital expenditureApproved and contracted for: Property, plant and equipment 17,673 1,148 Approved but not contracted for: Property, plant and equipment 7,360 4,776 25,033 5,924

(b) Non-cancellable operating lease commitments – as lessee

Future minimum rentals payable under non-cancellable operating leases (excluding land use rights) at the reporting date are as follows:

Group 2012 2011 RM’000 RM’000

Not later than 1 year 228 305 Later than 1 year but not later than 5 years 864 876 Later than 5 years 4,608 4,824 5,700 6,005

Operating lease commitments represent rentals payable by the Group for use of land and buildings. Included in operating lease commitments are commitments in respect of a non-cancellable operating lease expiring in 2038 for a piece of property in a subsidiary, Naluri Properties Sdn. Bhd. (“NPSB”). NPSB has an option to renew the lease for another 30 years after the expiry of the lease. Should the lease be renewed, the additional lease payments for the renewal period, which is not included in the above would amount to RM7.2 million.

The remaining leases are negotiated for a term of 2 to 10 years.

111


39. RELATED PARTY DISCLOSURES

(a) Significant transactions

In addition to the related party information disclosed elsewhere in the financial statements, the following significant transactions between the Group, the Company and related parties took place at terms agreed between the parties during the financial year:


Dividend income from subsidiaries – – 78,025 31,372 Donation to Yayasan Harmoni* (4,000) (5,553) (500) (2,600)Interest income from subsidiaries – – 6,792 16,527 Management fee charged to a subsidiary – – – 300 Management fee charged by a subsidiary – – (540) (240)

* Dato’ Sri Adam Sani Bin Abdullah is the founder and executive chairman of Yayasan Harmoni, a non-profitable non-government organisation.

(b) Compensation of key management personnel

The remuneration of certain directors and other members of key management during the year were as follows:

Group 2012 2011 RM’000 RM’000

Short-term employee benefits 5,909 4,508 Defined contribution plan 692 507

6,601 5,015

Included in the remuneration of total key management personnel are:

Group 2012 2011 RM’000 RM’000

Directors’ remuneration 1,579 1,063


112


40. FAIR VALUE OF FINANCIAL INSTRUMENTS

(a) Fair value of financial instruments that are carried at fair value

The following table shows an analysis of the financial instruments carried at fair value by level of fair value hierarchy:

quoted prices in active Significant Significant markets for other un- identical observable observable instruments inputs inputs Total (Level 1) (Level 2) (Level 3)Group RM’000 RM’000 RM’000 RM’000

At 29 February 2012

Financial assets:Marketable securities 1,441 – – 1,441

Financial liabilities:Derivatives- Forward foreign exchange contracts – (95) – (95)

At 28 February 2011


Financial liabilities:Derivatives- Forward foreign exchange contracts – (8) – (8)

Company

At 29 February 2012


At 28 February 2011


113


40. FAIR VALUE OF FINANCIAL INSTRUMENTS (CONT’D.)

(a) Fair value of financial instruments that are carried at fair value (cont’d.) Fair value hierarchy

The Group classifies fair value measurement using a fair value hierarchy that reflects the significance of the inputs used in making the measurements. 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); and

- Level 3 – Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Determination of fair value

Marketable securities (Note 25): Fair value is determined directly by reference to their published market bid price at the reporting date (Level 1).

Derivatives (Note 36): Forward currency contracts are valued using a valuation technique with market observable inputs (Level 2). The most frequently applied valuation techniques include forward pricing models, using present value calculations. The models incorporate various inputs including the credit quality of counterparties, foreign exchange spot and forward rates and interest rate curves.

(b) Fair value of financial instruments by classes that are not carried at fair value and whose carrying amounts are not reasonable approximation of fair value

2012 2011 Carrying Fair Carrying Fair amount value amount value RM’000 RM’000 RM’000 RM’000 Group

Obligations under finance leases (Note 34) 3,405 3,210 4,302 3,819

(c) 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

Other receivables (non-current) 22Trade and other receivables (current) 22Trade and other payables (current) 35Borrowings (non-current) 33Borrowings (current) 33

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.


114


40. FAIR VALUE OF FINANCIAL INSTRUMENTS (CONT’D.)

(c) Fair value of financial instruments by classes that are not carried at fair value and whose carrying amounts are reasonable approximation of fair value (cont’d.)

The carrying amounts of the current portion of borrowings are reasonable approximations of fair values due to the insignificant impact of discounting.

The fair values of current 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.

Amounts due from/(to) related companies, staff loans and fixed rate bank loans

The fair values of these financial instruments are estimated by discounting expected future cash flows at market incremental lending rate for similar types of lending or borrowing at the reporting date.

41. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Group and the Company are exposed to financial risks arising from their operations and the use of financial instruments. The key financial risks include credit risk, liquidity risk, interest rate risk, foreign currency risk and market price risk.

The Board of Directors reviews and agrees policies and procedures for the management of these risks, which are executed by the Group and by the Company. The audit committee provides independent oversight to the effectiveness of the risk management process.

It is, and has been throughout the current and previous financial year, the Group’s policy that no derivatives shall be undertaken except for the use as hedging instruments where appropriate and cost-efficient. The Group and the Company do not apply hedge accounting.

The following sections provide details regarding the Group’s and the Company’s exposure to the above-mentioned financial risks and the objectives, policies and processes for the management of these risks.

(a) Credit risk

Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on its obligations. The Group’s credit risk is primarily attributable to trade receivables.

The credit risk of the Group’s other financial assets, which comprise cash and cash equivalents, arises from default of the counterparty, with a maximum exposure equal to the carrying amount of these financial assets.

The Group’s 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 Group’s 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 Group’s exposure to bad debts is not significant. Since the Group trades only with recognised and creditworthy third parties, there is no requirement for collateral.

The Group does not have any significant exposure to any individual customer or counterparty nor does it have any major concentration of credit risk related to any financial assets.

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41. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONT’D.)

(a) Credit risk (cont’d.)

Exposure to credit risk

At the reporting date, the Group’s and the Company’s maximum exposure to credit risk is represented by: - The carrying amount of each class of financial assets recognised in the statements of financial

position.- Nominal amount of RM62,397,000 (2011: RM72,500,000) relating to corporate guarantees

provided by the Company for banking facilities to certain subsidiaries.

Credit risk concentration profile

The Group determines concentrations of credit risk by monitoring the industry sector profile of its trade receivables on an ongoing basis. The credit risk concentration profile of the Group’s trade receivables at the reporting date are as follows:

Group 2012 2011

RM’000 % of total RM’000 % of total

By industry sectors:Property and hospitality 2,267 6% 2,839 8%Trading of duty free goods and non-dutiable merchandise 11,141 31% 9,028 25%Automotive 22,287 63% 24,375 67% 35,695 100% 36,242 100%

Financial assets that are neither past due nor impaired

Trade and other receivables that are neither past due nor impaired are creditworthy debtors with good payment record with the Group. Cash and cash equivalents and derivatives that are neither past due nor impaired are placed with or entered into with reputable financial institutions or companies with high credit ratings and no history of default.

Financial assets that are either past due or impaired

Information regarding financial assets that are either past due or impaired is disclosed in Note 22.

(b) 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 Group manages its debt maturity profile, operating cash flows and the availability of funding so as to ensure that refinancing, repayment and funding needs are met. As part of its overall liquidity management, the Group maintains sufficient levels of cash or cash convertible investments to meet its working capital requirements. In addition, the Group strives to maintain available banking facilities at a reasonable level to its overall debt position. As far as possible, the Group raises committed funding from both capital markets and financial institutions and balances its portfolio with some short term funding so as to achieve overall cost effectiveness.


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(b) Liquidity risk (cont’d.)

Analysis of financial instruments by remaining contractual maturities

The table below summarises the maturity profile of the Group’s and of the Company’s liabilities at the reporting date based on contractual undiscounted repayment obligations.

2012 On demand or within One to Over five one year five years years Total RM’000 RM’000 RM’000 RM’000Group

Financial liabilities:Trade and other payables 130,184 – – 130,184Borrowings 103,354 151,904 – 255,258Derivatives 95 – – 95

Total undiscounted financial liabilities 233,633 151,904 – 385,537

Company

Financial liabilities:Other payables 431,221 – – 431,221Borrowings 6 150,238 – 150,244


2011

Group

Financial liabilities:Trade and other payables 125,537 – – 125,537 Borrowings 128,682 310,012 – 438,694 Derivatives 8 – – 8


Company

Financial liabilities:Other payables 433,394 – – 433,394 Borrowings 8,614 270,821 – 279,435


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(c) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of the Group’s and of the Company’s financial instruments will fluctuate because of changes in market interest rates.

The Group’s and the Company’s exposure to interest rate risk arises primarily from interest-bearing borrowings. Borrowings at floating rates expose the Group to cash flow interest rate risk. Borrowings obtained at fixed rates expose the Group to fair value interest rate risk.

The Group manages its interest rate exposure by maintaining a mix of fixed and floating rate borrowings.

Sensitivity analysis for interest rate risk

The table below demonstrates the sensitivity to a reasonably possible change in interest rates with all other variables held constant, of the Group’s and of the Company’s profit net of tax (mainly through the impact on interest expense on floating rate loans and borrowings). The assumed movement in the basis points for interest rate sensitivity analysis is based on the currently observable market environment.

Increase/ (decrease) Effect on in basis profit net points of tax Group RM’000

29 February 2012Ringgit Malaysia +10 (104)Singapore Dollar +10 (22)United States Dollar +10 (8) Ringgit Malaysia -10 104Singapore Dollar -10 22United States Dollar -10 8 28 February 2011Ringgit Malaysia +10 (225)Singapore Dollar +10 (20) Ringgit Malaysia -10 225Singapore Dollar -10 20 Company

29 February 2012Ringgit Malaysia +10 (89) Ringgit Malaysia -10 89 28 February 2011Ringgit Malaysia +10 (163) Ringgit Malaysia -10 163


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(d) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

The Group has transactional currency exposures arising from sales or purchases that are denominated in a currency other than the functional currency of the operations to which they relate, primarily United States Dollar (“USD”), Singapore Dollar (“SGD”), Euro Dollar (“EURO”), Thai Baht (“THB”) and Japanese Yen (“JPY”). The foreign currencies in which these transactions are denominated are mainly USD and JPY. Foreign currency exposures in transactional currencies other than functional currencies of the operating entities are kept to an acceptable level.

At balance sheet date, the Group have short term borrowings of RM28,895,000 (2011: RM26,381,000) which are denominated in SGD and RM10,663,000 (2011: RM Nil) which are denominated in USD.

Sensitivity analysis for foreign currency risk

The following table demonstrates the sensitivity of the Group’s profit net of tax to a reasonably possible change in the USD, SGD, EURO, THB and JPY exchange rates against the respective functional currencies of the Group entities, with all other variables held constant.

Group 2012 2011 RM’000 RM’000

USD/RM - strengthened 3% (2011: 3%) (807) (755) - weakened 3% (2011: 3%) 807 755 SGD/RM - strengthened 3% (2011: 3%) (850) (866) - weakened 3% (2011: 3%) 850 866 EURO/RM - strengthened 3% (2011: 3%) (4) (1) - weakened 3% (2011: 3%) 4 1 THB/RM - strengthened 3% (2011: 3%) (98) 2 - weakened 3% (2011: 3%) 98 (2) JPY/RM - strengthened 3% (2011: 3%) – (102) - weakened 3% (2011: 3%) – 102

(e) Market price risk

Market price risk is the risk that the fair value or future cash flows of the Group’s financial instruments will fluctuate because of changes in market prices (other than interest or exchange rates).

The Group does not have exposure to commodity price risk.

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42. CAPITAL MANAGEMENT

The primary objective of the Group’s 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 year under review.

The Group monitors capital using a gearing ratio, which is total external debt divided by total capital.

The Group’s policy is that the gearing ratio shall not be more than 1.5 times.

The Group includes within total external debt, all financial borrowings of the Group. Total external debt due and payable within 12 months consists of bankers’ acceptances, bank overdrafts, interest payable and current portion of obligations under finance leases. Capital includes equity attributable to owners of the parent and non-controlling interests.


Borrowings (non-current) 119,637 242,458 118,013 210,018 Borrowings (current excluding term loans, i.e. due and payable within 12 months) 24,283 17,749 5 5 Borrowings (current - term loans) 78,895 108,412 – 8,000

Total external debt 222,815 368,619 118,018 218,023

Total equity 480,727 411,671 850,940 849,659

Gearing ratio (times) 0.46 0.90 0.14 0.26

43. SEGMENT INFORMATION

(a) Reporting format

The primary segment reporting format is determined to be business segments as the Group’s risks and rates of return are affected predominantly by differences in the products and services. The activities of the Group are carried out mainly in Malaysia and as such, segmental reporting by geographical locations is not presented. The operating businesses are organised and managed separately according to the nature of the products and services provided, with each segment representing a strategic business unit that offers different products and serves different markets.

(b) Business segments

The Group comprises the following main business segments:

(i) Investment holding;

(ii) Property and hospitality;

(iii) Trading of duty free goods and non-dutiable merchandise; and

(iv) Automotive.


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43. SEGMENT INFORMATION (CONT’D.)

(b) Business segments (cont’d.)

Other business segments mainly consist of provision of corporate services, dormant and inactive company, none of each are of a sufficient size to be reported separately.

Management monitors the operating results of its business units separately for the purpose of making decisions about resource allocation and performance assessment. Segment performance is evaluated based on operating profit or loss which, in certain respects as explained in the table below, is measured differently from operating profit or loss in the consolidated financial statements. Group financing (including finance costs) and income taxes are managed on a group basis and are not allocated to operating segments.

(c) Allocation basis and transfer pricing

Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.

The directors are of the opinion that transfer prices between business segments are based on negotiated prices. Segment revenue, expenses and results include transfers between business segments. These transfers are eliminated on consolidation.

Year 2012 Trading of duty free Per Property goods and Adjustments consolidated Investment and non-dutiable and financial holding hospitality merchandise Automotive Others eliminations statements

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Note RM’000

Revenue:External customers 1,927 88,546 506,697 124,848 22 – 722,040Inter-segment 130,580 17,254 671 – 8,340 (156,845) A –

Total revenue 132,507 105,800 507,368 124,848 8,362 (156,845) 722,040

Results:Depreciation (8) (12,717) (4,690) (5,341) (79) – (22,835)Amortisation of land use rights – (649) – – – – (649)Impairment loss on property, plant and equipment – – – – (3,736) – (3,736)Gain on disposal of land held for property development – 72,582 – – 28,113 – 100,695Share of results of an associate – – – – 22 – 22Other non-cash expenses (3,046) (391) (612) (198) – – B (4,247)Segment (loss)/profit (5,153) 80,981 79,055 4,898 9,229 (10,712) C 158,298

Assets:Investment in associate 459 – – – – – 459Additions to non-current assets 2 6,946 2,119 9,310 273 – D 18,650Segment assets 64,052 350,529 282,821 105,950 78,240 12,246 E 893,838

Segment liabilities 61,855 31,895 84,757 29,565 24,008 181,031 F 413,111

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Year 2011 Trading of duty free Per Property goods and Adjustments consolidated Investment and non-dutiable and financial holding hospitality merchandise Automotive Others eliminations statements

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000 Note RM’000

Revenue:External customers 1,230 80,105 521,454 141,957 43 – 744,789 Inter-segment 61,433 16,597 781 – 8,330 (87,141) A –

Total revenue 62,663 96,702 522,235 141,957 8,373 (87,141) 744,789

Results:Depreciation (14) (12,531) (5,015) (4,875) (1,143) – (23,578) Amortisation of land use rights – (702) – – – – (702)Share of results of an associate – – – – (28) – (28)Cost of acquisition and reorganisation (40,496) – – – – – (40,496)Other non-cash income/(expense) 237 (435) (352) (685) – – B (1,235)Segment profit 40,567 7,009 101,708 11,856 1,986 (89,426) C 73,700

Assets:Investment in associate 437 – – – – – 437Additions to non- current assets – 13,712 3,590 6,565 39 – D 23,906Segment assets 49,252 398,168 279,829 104,056 97,556 10,471 E 939,332

Segment liabilities 36,551 25,623 84,394 31,958 14,317 334,818 F 527,661

A Inter-segment revenues are eliminated on consolidation.

B Other material non-cash expenses/(income) consist of the following items as presented in the respective notes to the financial statements:

2012 2011 Note RM’000 RM’000

Bad debts written off 8 32 69 Changes in fair value of marketable securities 8, 5 2,576 (237)Impairment loss on receivables 8 523 209 Inventories written down 8 335 758 Inventories written off 8 262 275 Property, plant and equipment written off 8 519 161 4,247 1,235


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C The following items are deducted from/(added to) segment profit to arrive at “Profit before tax” presented in the consolidated income statement:

2012 2011 RM’000 RM’000

Inter-segment transactions (5,743) 67,360 Share of results of an associate (22) 28 Finance costs 16,477 22,038 10,712 89,426

D Additions to non-current assets consist of:

2012 2011 RM’000 RM’000

Property, plant and equipment 13,950 14,949 Land held for property development 4,450 7,439 Investment properties 42 1,069 Biological assets 208 449

18,650 23,906

E The following items are added to segment assets to arrive at total assets reported in the consolidated statement of financial position:

2012 2011 RM’000 RM’000

Investment in associate 459 437 Deferred tax assets 6,646 6,353 Tax recoverable 5,141 3,681

12,246 10,471

F The following items are added to segment liabilities to arrive at total liabilities reported in the consolidated statement of financial position:

2012 2011 RM’000 RM’000

Deferred tax liabilities 8,956 9,150 Tax payable 4,075 3,668 Borrowings 168,000 322,000

181,031 334,818

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44. MATERIAL LITIGATIONS

(a) Originating Summons by Shahidan Bin Shafie (“Shahidan”)

Shahidan, a shareholder of the Company, had commenced legal proceedings at the High Court against the Company and Atlan Properties Sdn. Bhd. (“APSB”) on 2 April 2004, seeking inter alia that the proposals by the Company relating to the acquisition of shares of Naluri Corporation Berhad (“Naluri”) and the funding structure and bond issuance related thereto, be declared void, and that the Company and APSB be restrained from proceeding with the proposals.

Upon the application by the Company and APSB to strike out the suit, the High Court dismissed the suit with costs on 26 April 2004. Shahidan appealed to the Court of Appeal against the dismissal. The Court of Appeal allowed Shahidan’s appeal and granted leave to Shahidan to amend the Originating Summons. The suit was thereafter remitted back to the High Court to effect the amendments to the Originating Summons and to hear the amended Originating Summons.

The Company and APSB have applied to the High Court to strike out the amended Originating Summons. These applications to strike out came up for hearing on 11 June 2009 and for decision on 31 July 2009. On 31 July 2009, the High Court allowed these applications to strike out, and accordingly, dismissed the suit.

On 13 August 2009, Shahidan filed a notice of appeal to the Court of Appeal against the High Court’s dismissal of the suit. The appeal is fixed for hearing in the Court of Appeal on 26 June 2012.

(b) Writ of Summons and Statement of Claim by Shahidan

Shahidan, a shareholder of Naluri, had commenced legal proceedings at the High Court against the Company and APSB on 26 May 2004, seeking inter alia an order that the Company and APSB jointly and severally make a mandatory take-over offer to all shareholders of Naluri (except Pengurusan Danaharta Nasional Berhad, Danaharta Urus Sdn. Bhd. and Danaharta Managers Sdn. Bhd. (collectively “Danaharta”)) at an offer price of RM1.98 per ordinary share of Naluri, and for damages be assessed.

The Company and APSB had applied to strike out the suit but these applications were dismissed by the Senior Assistant Registrar of the High Court on 8 September 2004. The Company and APSB have appealed to the High Court Judge against the Senior Assistant Registrar’s dismissal of the striking out applications. These appeals against the dismissal of the striking out application were dismissed by the High Court Judge on 11 March 2010 with costs in cause (“Dismissal”). A further appeal against the Dismissal had been filed to the Court of Appeal by APSB on 29 March 2010 and the Company on 8 April 2010, respectively. The appeal is fixed for hearing in the Court of Appeal on 26 June 2012.

Shahidan had written to the High Court Judge on 2 September 2010 for an adjournment of the trial fixed on 11 to 13 October 2010. Trial had proceeded from 28 May 2012 to 30 May 2012. The Court has fixed the matter for decision on 21 June 2012.

Shahidan had also applied to the High Court via an interlocutory application to adduce further evidence at the hearing of the Company’s and APSB’s aforesaid appeal to the High Court Judge. On 1 October 2009, the High Court allowed this application with costs in the said appeal.

(c) Claim by Tan Sri Dato’ Tajudin Ramli (“TSDTR”)

By way of a Defence and Counterclaim dated 29 June 2006, the Company, APSB and Naluri have been made a party to the legal proceedings commenced by Danaharta against TSDTR in the High Court. DFZ Capital Berhad (“DFZ”) was subsequently made a party to the legal proceedings by way of a Re-Amended Defence and Counterclaim dated 30 October 2008.


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44. MATERIAL LITIGATIONS (CONT’D.)

(c) Claim by Tan Sri Dato’ Tajudin Ramli (“TSDTR”) (cont’d.)

TSDTR is seeking from the Company, APSB, Naluri, DFZ and 8 other defendants, jointly and/or severally, inter alia:

(i) various declarations to declare void the Agreement dated 11 August 2003 between Danaharta and APSB in relation to the sale and purchase of Naluri shares from Danaharta; to declare that these defendants have acted ultra vires their respective powers and/or in bad faith by causing APSB and/or Naluri to enter into the said Agreement dated 11 August 2003 and/or the Naluri Scheme (as referred to in the Counterclaim, which includes the Capital Repayment and Naluri Acquisitions) and therefore all transactions entered into between the relevant parties in relation to the Naluri Scheme be also declared void;

(ii) consequential orders as may be necessary to restore all persons to their position prior to the execution and/or purported completion of the aforesaid transactions or agreements and/or to give effect to any other orders sought by TSDTR;

(iii) an account of all dividends and/or other payments received by APSB in relation to its Naluri shares, and order that APSB forthwith pays the same to TSDTR;

(iv) general damages to be assessed.

Further and/or in the alternative, TSDTR is also seeking from the Company, APSB and 11 other defendants, jointly and/or severally, inter alia, damages to be assessed and orders that they make a mandatory take-over offer to all shareholders of Naluri at an offer price of RM1.98 per ordinary share in accordance with the Securities Commission Act, 1993 and the Malaysian Code on Take-Overs and Mergers (“Takeover Code”) and pay to TSDTR the sum of RM613,103,000 pursuant to the mandatory take-over.

TSDTR is also seeking from DFZ and 26 other defendants to the Counterclaim, jointly and/or severally, inter alia the sum of RM6,246,492,000 (being shares in the 10th defendant to the Counterclaim at RM24 per share); general, aggravated and exemplary damages to be assessed; and damages for conspiracy to be assessed.

Further and in addition, TSDTR is also seeking from all the 38 Defendants to the Counterclaim, jointly and severally, inter alia the sum of RM7,214,909,000; damages for conspiracy to be assessed; various declarations in regards to the invalidity of the vestings made in favour of Danaharta and the acts, deeds and agreements, transfers, conveyances, dealings executed by Danaharta and the then Special Administrators of Naluri pursuant to the said vestings in favour of Danaharta, including the return and restoration of all assets and monies transferred or conveyed; damages, including aggravated and exemplary damages to be assessed; and interest and costs.

TSDTR had also applied to the High Court via an interlocutory application for inter alia a mareva injunction order that Naluri, whether by itself or otherwise, be restrained from completing the Proposed Business Transfer and Proposed Capital Repayment (each as described in the Counterclaim) and/or any other similar proposals. On 14 April 2008, the High Court allowed TSDTR’s application for a mareva injunction order. The Company, APSB and Naluri then appealed to the Court of Appeal against the High Court’s grant of the mareva injunction order and these appeals were allowed by the Court of Appeal on 28 April 2008. TSDTR then applied to the Federal Court for leave to appeal to the Federal Court against the decision of the Court of Appeal, but leave to appeal was refused by the Federal Court on 21 January 2009.

TSDTR had also applied to the High Court via an interlocutory application to seek leave to re-amend the Counterclaim. The Senior Assistant Registrar of the High Court allowed this application to re-amend with costs. The Company, APSB and Naluri have appealed to the High Court Judge against the Senior Assistant Registrar’s decision, wherein the Court had on 12 November 2009 allowed the appeal and by reason thereof DFZ is not a party in the Counterclaim.

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(c) Claim by Tan Sri Dato’ Tajudin Ramli (“TSDTR”) (cont’d.)

The Company, APSB, Naluri and DFZ have applied to strike out the suit, wherein the Court had on 7 December 2009 allowed the striking out application with cost to be paid to the Company and Naluri. TSDTR had on 4 January 2010 filed an appeal against the decision granting the striking out the said application. Pursuant to an out of court settlement between TSDTR and Danaharta, TSDTR had on 14 February 2012 withdrew all its appeal including the appeal against the decision granting the Company, APSB and Naluri’s striking out application on 7 December 2009. The Court of Appeal has ordered that TSDTR to pay cost of RM10,000 each to the Company, APSB and Naluri in respect of the withdrawal of the striking out application and cost of RM5,000 to DFZ in respect of the TSDTR’s application to re-amend the Counterclaim.

As a result of the above developments, the matter has come to a close.

(d) Writ of Summons and Statement of Claim by TSDTR

TSDTR had commenced legal proceedings at the High Court against the Company and Naluri on 16 April 2007, seeking from the Company, Naluri and all other 11 defendants, jointly and/or severally, inter alia:

(i) a declaration that the resolutions purportedly passed at the extraordinary general meeting of Naluri dated 8 March 2007 pursuant to Naluri’s circular to shareholders dated 12 February 2007 are void;

(ii) an order that Naluri and/or the Company be restrained from putting into effect any resolutions purportedly passed at the said extraordinary general meeting and/or completing the proposed disposal of the business and the capital repayment of Naluri or any other similar proposals pursuant to the resolutions;

(iii) general, aggravated and exemplary damages to be assessed, and damages for conspiracy, misrepresentation and breach of statutory duty to be assessed;

(iv) all necessary orders as may be required to give effect to the declarations and orders sought and/or as the Court thinks fit.

The Company and Naluri have applied to strike out the suit. These applications to strike out have been granted by the Judge on 28 April 2010. TSDTR had filed an appeal on 17 May 2010 against the decision of the Judge in allowing the striking out application. TSDTR had on 29 July 2010 filed a Notice of Motion to the Court of Appeal to adduce further evidence during the hearing of TSDTR’s appeal against the Judge’s decision in allowing the striking out. The appeal is fixed for hearing in the Court of Appeal on 28 June 2012.

TSDTR had also applied to the High Court via an interlocutory application seeking jointly and/or severally against Naluri and 9 other defendants, inter alia that they be restrained from putting into effect any resolutions purportedly passed at the said extraordinary general meeting and/or completing the proposed disposal of the business and the capital repayment of Naluri or any other similar proposals pursuant to the resolutions, pending completion of the trial of the suit.


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(e) Writ of Summons and Statement of Claim by Adenan Bin Ismail (“Adenan”)

Adenan, a shareholder of Naluri, commenced legal proceedings at the High Court against the Company and APSB on 16 September 2008, following the completion of the corporate exercises by the Company and/or APSB in relation to the Agreement dated 11 August 2003 between Danaharta and APSB for the sale and purchase of Naluri shares from Danaharta. Adenan is seeking against the Company, APSB and 7 other defendants, inter alia:

(i) an order that the Company, APSB and 6 other defendants are persons acting in concert for the purposes of gaining control of Naluri, that the defendants have acquired control of Naluri as at 2 March 2005 or such other date as the Court determines;

(ii) an order that the Company and/or APSB make a take-over offer to all existing shareholders of Naluri to acquire their shares at RM1.98 per share of Naluri and that the Securities Commission directs that the Company and/or APSB effect such take-over offer, and if such take-over is not effected, then the capital repayment and the acquisitions by Naluri as described in the Statement of Claim are rendered void.

The Company’s and APSB’s application to strike out the suit has been allowed by the Court on 20 October 2010. Adenan has filed an appeal against the High Court’s decision. The Court of Appeal has fixed the matter for hearing on 6 February 2012 and 5 March 2012. With the withdrawal of the appeal by Adenan on 5 March 2012, there is no more matter pending between the parties.

(f) Writ of Summons and Statement of Claim by Adenan

Adenan, a shareholder of Naluri, commenced legal proceedings at the High Court against Naluri, the Company and Darul Metro Sdn. Bhd. (“DMSB”) on 19 September 2008, purportedly for the benefit of Naluri. Adenan is seeking against Naluri, the Company, DMSB and 9 other defendants, inter alia:

(i) various declarations as against the Company and DMSB, to declare that they are jointly and severally liable to account to Naluri for the difference between the actual value of Naluri’s assets as described in the Sale of Business Agreement dated 5 January 2007 between Naluri and DMSB and the sum actually paid by the Company or such other sum as the Court thinks fit, and that they are liable to account to Naluri for all benefits gained or derived from the use of Naluri’s assets as described in the said Sale of Business Agreement;

(ii) various orders as against all defendants (except Naluri), to rescind the said Sale of Business Agreement and the Subscription Agreement dated 5 January 2007 between the Company and DMSB; for loss and damage to be assessed; interest and costs.

The applications by Naluri, the Company and DMSB to strike out the suit have been granted by the Court on 18 May 2010. An appeal had been filed by Adenan on 7 June 2010. The Court of Appeal has fixed the matter for hearing of the appeal on 26 June 2012.

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(g) Writ of Summons and Statement of Claim by Malaysian Airline System Berhad and 2 others

Malaysian Airline System Berhad (“MASB”), MAS Golden Holidays Sdn. Bhd. (“MGH”) and MAS Hotels & Boutiques Sdn. Bhd. (“MHB”) had commenced legal proceedings on 26 May 2006 against Naluri and 4 other defendants seeking, inter alia:

(i) various declarations as against Naluri, to declare that Naluri is liable to MASB and/or MGH as a constructive trustee for allegedly assisting in the breach of fiduciary duties and/or obligations by TSDTR and/or knowingly receiving monies paid in breach of TSDTR’s fiduciary duties or obligations, and to declare that Naluri holds on trust for MASB and/or MGH any payment or profit received arising from the said alleged assistance and is liable to pay the same to MASB and/or MGH;

(ii) damages for dishonest assistance and/or knowing receipt, for conspiracy and/or for unlawful interference in the business of MASB and/or MGH.

Naluri had applied to the High Court to strike out the suit. This application to strike out was dismissed with costs on 15 September 2008. Naluri has appealed to the Court of Appeal against the dismissal by the High Court. The appeal had been withdrawn with no order as to costs on 10 May 2012. The High Court has fixed the suit for case management on 22 June 2012.

(h) Winding-up Petition by Shahidan

Shahidan, a shareholder of Naluri, had commenced winding-up proceedings at the High Court against Naluri on 29 February 2008. Shahidan is seeking inter alia that Naluri be wound up by the Court under the provisions of section 218(1)(f) and section 218(1)(i) of the Companies Act, 1965, and that the Official Receiver be appointed as provisional liquidator of Naluri.

Naluri had applied to the High Court, seeking inter alia:

(i) to strike out the suit, or alternatively, that all proceedings under the suit be stayed;

(ii) to restrain Shahidan and/or its solicitors from giving any notice of the winding-up proceedings to any third party; and pending disposal of this application by Naluri or until further order by the High Court, that the suit and all proceedings therein be stayed; and

(iii) to validate the transfer of all shares of Naluri made since the commencement of the winding-up proceedings.

On 24 April 2008, the High Court allowed with costs Naluri’s application to strike out the suit, and validated all transfers of shares of Naluri made since the commencement of the winding-up proceedings. Shahidan has appealed to the Court of Appeal against the said decisions of the High Court. The appeal is fixed for hearing in the Court of Appeal on 27 June 2012.

(i) Arbitration proceedings by Mancon Berhad (“MB”) on behalf of Nilai Barisan Sdn. Bhd. (“NBSB”)

MB, on behalf of NBSB, had commenced arbitration proceedings against Kelana Megah Sdn. Bhd. (“KMSB”) on 24 May 1999 in relation to NBSB’s engagement as a sub-contractor nominated by KMSB for the supply, installation, testing and commissioning of air-conditioning and mechanical ventilation works in the construction of the Johor Bahru Duty Free Complex. The sum claimed by MB is approximately RM2,468,000. KMSB has counter-claimed that it incurred loss/damage in the sum of approximately RM1,909,000 in rectifying defective and/or incomplete works of NBSB.


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(i) Arbitration proceedings by Mancon Berhad (“MB”) on behalf of Nilai Barisan Sdn. Bhd. (“NBSB”) (cont’d.)

KMSB’s solicitors informed the Arbitrator on 21 January 2002 that NBSB had been wound up on 8 August 2000. In view that NBSB had been wound up, parties were not able to resume the arbitration proceedings and the same is currently in abeyance.

KMSB’s solicitors had issued numerous letters to the Arbitrator to seek the Arbitrator’s instructions on the arbitration proceedings and/or instructions that the arbitration proceedings be closed. To date, KMSB has not received any response from the Arbitrator. KMSB’s solicitors had also written to the liquidator of NBSB to request that the liquidator decides either if NBSB wishes to continue with the arbitration proceedings or to withdraw the claims against KMSB. To date, KMSB has not received any response from the liquidator.

(j) Writ of Summons and Statement of Claim by LH Technology Sdn. Bhd. (“LHT”)

LHT had commenced legal proceedings at the High Court against KMSB on 30 December 1999, claiming a sum of RM1,026,000 in relation to LHT’s engagement as a sub-contractor for the design, supply and installation of curtain walling, frameless glass panel, shopfront, balustrading, aluminium and glazing works in the construction of the Johor Bahru Duty Free Complex.

On 26 June 2000, the Senior Assistant Registrar of the High Court allowed LHT’s application for a summary judgment against KMSB. KMSB appealed to the High Court Judge against the said summary judgment, and this appeal was allowed. LHT then appealed to the Court of Appeal against the decision of the High Court Judge.

On 28 July 2008, LHT’s appeal was dismissed with no order as to costs by the Court of Appeal. KMSB’s solicitor has informed the High Court of the said dismissal of the LHT’s appeal, and requested the High Court to fix a mention date for the suit. To-date, the High Court has not fixed any date for this suit.

(k) Writ of Summons and Statement of Claim by Eden Enterprises (M) Berhad (“EEB”)

EEB had commenced legal proceedings at the High Court on 31 January 2004 against DFZ Duty Free (Langkawi) Sdn. Bhd. (“DDFL”) and 2 other defendants in respect of an alleged tort of conspiracy on a long-term lease of twenty-eight (28) years entered into between EEB and DDFL for a duty free outlet and staff living quarters in Langkawi (“premises”).

EEB had also applied to the High Court via an interlocutory application to compel DDFL to quit, vacate and deliver up to EEB the premises. EEB’s application was dismissed by the High Court on 6 December 2005.

EEB then appealed to the Court of Appeal against the said dismissal by the High Court. The Court of Appeal dismissed EEB’s appeal on 27 May 2009.

DDFL had filed an application for an interim injunction to restrain EEB and its subsidiary from exercising self-help to regain vacant possession of the premises and interfering with DDFL’s quiet enjoyment of the same. DDFL also filed another application subsequently for an interim injunction to restrain EEB and its subsidiary from prohibiting and qualifying DDFL’s use of lanes around the premises for access to or egress from the premises.

Consent Order was duly recorded between the parties on 23 November 2010 before the High Court Judge wherein EEB withdraws all claims against DDFL and DDFL withdraws its counterclaim against EEB without any order as to costs (“Consent Order”).

129



(k) Writ of Summons and Statement of Claim by Eden Enterprises (M) Berhad (“EEB”) (cont’d.)

Pursuant to the terms of the Consent Order, the parties had duly appointed their respective valuers to undertake a valuation of the market rate for Lot No. 970, 971, 973, and 1556, Mukim Kedawang, Daerah Langkawi (excluding the staff living quarters) (“Demised Premises”). However, as there is a dispute arising from the Consent Order, DDFL had on 24 May 2011 filed a Writ of Summons and Statement of Claim (“Case”) in the Alor Setar High Court vide Civil Suit No. 22-158-2011, seeking amongst others, for the following declaratory reliefs:

(i) a declaration that paragraph (c) of the Consent Order be declared void for uncertainty;

(ii) a declaration that the valuation dated 3 January 2011 by EEB’s valuer be declared null and void; and

(iii) an order that EEB grant a lease of the Demised Premises occupied by DDFL for a term of three (3) years commencing from 1 January 2011 and thereafter, renewable every three (3) years until 31 March 2024 at the rate of RM1.60 per square feet in accordance with the valuation by DDFL’s valuer.

The Case has been fixed for mention on 25 July 2011.

Subsequent thereto, a Summons In Chambers and an Affidavit In Support had been filed on 26 June 2011 seeking for the following orders:

(i) an interim injunction to restrict and prohibit EEB whether by itself, or through its employees or agents or any of them, from exercising self-help to recover vacant possession of the Demised Premises until the determination or conclusion of the suit; and

(ii) an interim injunction to restrict and prohibit any interference with the peaceful possession, occupation and quiet enjoyment of the Demised Premises until the determination or conclusion of the suit.

(collectively “Application for Injunction”)

On 17 June 2011, EEB had filed a Summons In Chambers together with an Affidavit In Support to strike out DDFL’s Case (“Striking Out Application”).

The court had on 10 July 2011 directed for parties to exchange affidavits in respect of both the Application for Injunction and for the Striking Out Application and has fixed the matter for case management on 18 April 2012.

DDFL had on 7 March 2012 filed a Summons In Chambers together with an Affidavit In Support to amend the State of Claim (“Amendment Application”). The court had on 16 April 2012 allowed the Amendment Application.

Trial had commenced on 22 April 2012 and the court has now fixed the matter for continued trial on 1 and 15 July 2012.


130


45. PRIOR YEAR ADJUSTMENT

In the prior year, the amount due from one of the Company’s subsidiary was over-impaired by RM48,784,000. The effects of the above adjustment on the separate financial statements of the Company were as follows:

At 1 March At 1 March 2011 2011 As previously As stated Adjustment restated RM’000 RM’000 RM’000Company

Income statementOther operating expenses 100,682 (48,784) 51,898Profit net of tax 504,870 48,784 553,654

Statement of financial positionOther receivables 226,036 48,784 274,820

Statement of changes in equityRetained earnings 450,977 48,784 499,761

The above prior year adjustment does not have any effect on the statement of financial position of the Company as at 1 March 2010.

The above prior year adjustment does not have any effect on the consolidated financial statements.

46. SIGNIFICANT AND SUBSEqUENT EVENTS

(a) On 28 November 2006, Maybank Investment Bank Berhad (“Maybank-IB”) announced that the Board of the Company had proposed the acquisition of the entire business undertakings of Naluri including all its assets and liabilities and all the holdings in all its subsidiaries and associated companies for a total purchase consideration of approximately RM435.432 million (or equivalent to RM0.75 per ordinary share of RM1.00 each in Naluri) to be satisfied entirely by cash (“Proposed Acquisition”).

The Proposed Acquisition was approved by the shareholders at the Extraordinary General Meeting (“EGM”) on 2 March 2007 and the Ministry of International Trade and Industry (“MITI”) on 28 March 2007. On 3 July 2008, Maybank-IB, on behalf of the Board of the Company, announced that the completion of the Proposed Acquisition had taken place on the said date.

Upon the completion of the Acquisition, Naluri had proceeded, on 3 March 2010, to file a Petition to the High Court to confirm the Proposed Capital Repayment in order to give effect to the Special Resolution of Naluri passed at the EGM held on 8 March 2007, pursuant to Section 64 of the Companies Act 1965 (“Petition”). An application for dispensation of inquiry as to creditors had also been filed on 8 March 2010 (“Application”). The Court had on 19 March 2010 granted order in terms of the Application.

The Court has fixed the petition for Proposed Capital Repayment for hearing on 1 August 2012.

On 11 August 2011, Maybank-IB, on behalf of the Board of the Company announced that Securities Commission (“SC”) had vide its letter dated 9 August 2011, approved the extension of time of one year from 3 August 2011 to 2 August 2012 for Naluri to complete the Proposed Capital Repayment.

131


46. SIGNIFICANT AND SUBSEqUENT EVENTS (CONT’D.)

(b) In the previous financial year, as disclosed in Note 19(b), the Company acquired Duty Free International Limited (“DFI”) as part of a reorganisation initiative whereby DFZ Capital Berhad (“DFZ”) and Darul Metro Sdn. Bhd. were injected into DFI. This reorganisation initiative was completed on 7 January 2011. Pursuant to this reorganisation initiative and the requirements of Part III of the Malaysian Code on Take-Overs and Mergers, 2010, DFI has an obligation to undertake an unconditional take-over offer (“Offer”) to acquire all the remaining DFZ Shares that are not already held by DFI.

On 8 February 2011, the Offer has been validly accepted by the shareholders of not less than nine-tenths in the nominal value of DFZ Shares. Therefore, DFI invoked the provisions of Section 222 of the Capital Markets & Services Act, 2007 to compulsorily acquire any remaining DFZ Shares (“Compulsory Acquisition”) for which acceptances have not been received if DFI receives valid acceptances of not less than nine-tenths (9/10) in the nominal value of the DFZ Shares.

On 1 March 2011, the Offer was closed, and on 17 March 2011, the entire issued and paid-up share capital of DFZ was removed from the Official List of Bursa Malaysia Securities Berhad. The issuance of the additional DFI Shares before the Offer was closed, resulted in a dilution of equity interests in DFI from 81.23% as at 28 February 2011, to 81.15%.

On 1 April 2011, pursuant to the Compulsory Acquisition, the transfer of the remaining DFZ Shares from the dissenting shareholders to DFI has been affected and the payment for the remaining DFZ Shares not already held by DFI has been dispatched. DFZ became a wholly-owned subsidiary of DFI, upon the completion of the Compulsory Acquisition.

(c) On 10 April 2012, the Board of the Company announced that Atlan Technology Sdn. Bhd. (“ATSB”) has entered into a conditional Sale and Purchase Agreement (“ATSB SPA”) with Pesaka Ikhlas (M) Sdn. Bhd. (“Pesaka”), a subsidiary of Berjaya Assets Berhad, a company listed on the Bursa Malaysia Securities Berhad, to acquire all that parcel of vacant 99-year leasehold land bearing Lot No. PTB 10710 located at Stulang Laut, Johor Bahru, measuring approximately 4.899 acres in area, for a total cash consideration of RM32.01 million (“Proposed ATSB Property Disposal”).

In addition to the ATSB SPA, the subsidiaries of DFI, on the same day, had entered into the following sale and purchase agreements with Pesaka:

(i) The sale of Darul Metro Sdn. Bhd.’s (“DMSB”) legal and beneficial interests over the remaining lease period in six land parcels located in The Zon Johor Bahru at Stulang Laut, Johor Bahru (the “Duty Free Zone”) to Pesaka for a consideration of RM325.00 million (“DMSB Agreement”); and

(ii) The sale of Kelana Megah Sdn. Bhd.’s intended lease interests in the land parcel bearing lot number PTB 20379 to Pesaka for a consideration of RM27.99 million.

Upon completion of DMSB Agreement, Selasih Ekslusif Sdn. Bhd. (“Selasih”), a subsidiary of DFI, will commence a tenancy of eight (8) terms of 3 years each and 1 final period of 1 year, constituting a 25-year tenancy over certain premises within the Duty Free Zone (“Selasih Tenancy Agreement”). Pursuant thereto, Selasih shall also retain completely and exclusively within the Duty Free Zone, the entire supply chain of its duty free business of importing, wholesaling and retailing and goodwill associated thereto in respect of the import, supply and sale within the Duty Free Zone of liquor, spirits, beer, chocolate, tobacco products, perfumery and cosmetics for a period of 25 years from the date of the commencement of the Selasih Tenancy Agreement.

(d) On 6 June 2012, the Board of the Company announced that its subsidiary, United Sanoh Industries Sdn. Bhd. (“USISB”) has entered into a conditional sale and purchase agreement to dispose a piece of freehold industrial land comprising a single storey warehouse with an annexed 3-storey office building and 1 single storey guard house to Vibrant Advanced Products Sdn. Bhd. (“VAPSB”) for a total consideration of RM12.5 million (“Proposed Disposal”).


132


46. SIGNIFICANT AND SUBSEqUENT EVENTS (CONT’D.)

(d) (cont’d.)

Dato’ Wong Kam Fuat is one of the directors of VAPSB and also holds 99.8% equity interest in VAPSB. Dato’ Wong Kam Fuat also is the Managing Director of United Industries Holdings Sdn. Bhd. which in turn is the holding company of USISB.

Dato’ Wong Kam Fuat holds 294,484 ordinary shares of RM1 each in the Company, representing 0.12% of the total issued and paid up share capital in the Company. By virtue of the directorship and shareholdings held by Dato’ Wong Kam Fuat in VAPSB, Dato’ Wong is deemed to have an interest in the Proposed Disposal.

133

Supplementary Information

47. SUPPLEMENTARY INFORMATION

The breakdown of the retained earnings/(accumulated losses) of the Group and of the Company as at 29 February 2012 into realised and unrealised profits is presented in accordance with the directive issued by Bursa Malaysia Securities Berhad dated 25 March 2010 and prepared 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.


Total (accumulated losses)/ retained earnings - realised (44,682) (138,460) 505,046 503,761 - unrealised (25,580) (33,439) (4,000) (4,000)

Total share of retained earnings from associate - realised 21 – – –

(70,241) (171,899) 501,046 499,761Add: Consolidation adjustments 125,582 160,307 – –

Total retained earnings/(accumulated losses) as per financial statements 55,341 (11,592) 501,046 499,761


134

Directors’ Direct and Deemed Interests in the Company and/or its subsidiary companies

According to the Register of Directors’ Shareholdings required to be kept under Section 134 of the Companies Act, 1965 the Directors’ interests in the Company and its subsidiaries are as follows:-

Direct Interest Deemed Interest No. of No. ofName Ordinary Shares % Ordinary Shares %

Dato’ Sri Adam Sani Bin Abdullah 64,061 0.03 127,255,153(c) 50.17

Notes:-

(a) Dato’ Sri Adam Sani Bin Abdullah is deemed to have an interest in the shares of all the subsidiaries by virtue of his interest in shares in the Company.

(b) Other than disclosed above, none of the other Directors had any interest in shares in the Company or its subsidiaries.

(c) Deemed interested through Distinct Continent Sdn. Bhd. and Alpretz Capital Sdn. Bhd.

List of Substantial Shareholders as at 31 May 2012(As shown in the Register of Substantial Shareholders)

Direct Interest Deemed InterestName of No. of No. ofSubstantial Shareholders Ordinary Shares % Ordinary Shares %

Distinct Continent Sdn. Bhd. 83,220,340 32.81 44,034,813(1) 17.36Dato’ Sri Adam Sani Bin Abdullah 64,061 0.03 127,255,153(2) 50.17Sebastian Paul Lim Chin Foo – – 127,255,153(2) 50.17Cipta Nirwana (M) Sdn. Bhd. 15,726,885 6.20 – –Ong Seng Leng – – 15,726,885(3) 6.20Low Boo Peng – – 15,726,885(3) 6.20Seymour Pacific Limited 22,309,638 8.80 – –Dato’ Choo Yeow Ming – – 22,309,638(4) 8.80Dato’ Ong Kar Beau 17,990,043 7.09 – –Berjaya Corporation Berhad 20,600,000 8.12 43,000,000(5) 16.95Tan Sri Dato’ Seri Vincent Tan Chee Yioun – – 63,800,000(6) 25.15

Notes:-

(1) Deemed interested by virtue of Alpretz Capital Sdn. Bhd. being a wholly owned subsidiary of Distinct Continent Sdn Bhd.

(2) Deemed interested through Distinct Continent Sdn. Bhd. and Alpretz Capital Sdn. Bhd. by virtue of Section 6A of the Companies Act 1965

(3) Deemed interested through Cipta Nirwana (M) Sdn. Bhd. by virtue of Section 6A of the Companies Act 1965(4) Deemed interested through Seymour Pacific Limited by virtue of Section 6A of the Companies Act 1965 (5) Deemed interested by virtue of its interest in Inter-Pacific Capital Sdn. Bhd., Berjaya Philippines Inc. and pursuant

to a Conditional Share Purchase Agreement dated 3 May 2012 entered into between Berjaya Corporation Berhad and Cipta Nirwana (M) Sdn. Bhd.

(6) Deemed interested by virtue of his interest in Berjaya Corporation Berhad and its related corporation, Sublime Cartel Sdn. Bhd. and pursuant to a Conditional Share Purchase Agreement dated 3 May 2012 entered into between Berjaya Corporation Berhad and Cipta Nirwana (M) Sdn. Bhd.

Analysis of Shareholdingsas at 31 May 2012

135

Analysis of Shareholdings (cont’d)as at 31 May 2012

Class of Shares : Ordinary Shares of RM1.00 each fully paid

Voting Rights : One (1) vote per RM1.00 share

DISTRIBUTION OF SHAREHOLDINGS AS AT 31 MAY 2012 No. of % of No. of % of IssuedSize of Shareholdings Shareholders Shareholders Shares Share Capital

Less than 100 151 12.88 5,411 0.00100 – 1,000 371 31.66 70,843 0.021,001 – 10,000 420 35.84 1,350,309 0.5310,001 – 100,000 158 13.48 5,137,695 2.02100,001 to less than 5% of issued shares 66 5.63 50,994,432 20.105% and above of issued shares 6 0.51 196,091,719 77.33

TOTAL 1,172 100.00 253,650,409 100.00

THIRTY (30) LARGEST SHAREHOLDERS AS AT 31 MAY 2012

No. of Name of Shareholders Shares Held %

1. ABB Nominee (Tempatan) Sdn. Bhd. 56,337,750 22.21 - Pledged Securities Account for Distinct Continent Sdn. Bhd. (Adam Sani) 2. ABB Nominee (Tempatan) Sdn. Bhd. 22,270,500 8.78 - Pledged Securities Account for Alpretz Capital Sdn. Bhd.

3. Maybank Nominees (Tempatan) Sdn. Bhd. 20,000,000 7.88 - Pledged Securities Account for Berjaya Corporation Berhad

4. HSBC Nominees (Asing) Sdn. Bhd. 14,519,638 5.72 - AA Noms SG for Seymour Pacific Limited

5. OSK Nominees (Tempatan) Sdn. Berhad 13,000,000 5.13 - Bank of China (Malaysia) Berhad Pledged Securities Account for Distinct Continent Sdn. Bhd.

6. A. A. Anthony Nominees (Tempatan) Sdn. Bhd. 9,372,488 3.70 - Pledged Securities Account for Alpretz Capital Sdn. Bhd.

7. A.A. Anthony Nominees (Tempatan) Sdn. Bhd. 9,182,590 3.62 - Pledged Securities Account for Distinct Continent Sdn. Bhd.

8. Cartaban Nominees (Asing) Sdn. Bhd. 8,985,000 3.54 - Exempt an for Credit Agricole (Suisse) SA, Singapore Branch (Trust Account)

9. Al Wakalah Nominees (Tempatan) Sdn. Bhd. 8,563,668 3.38 - Pledged Securities Account for Ong Kar Beau

10. OSK Nominees (Tempatan) Sdn. Berhad 8,087,242 3.19 - Bank of China (Malaysia) Berhad Pledged Securities Account for Cipta Nirwana (M) Sdn. Bhd.

11. Alpretz Capital Sdn. Bhd. 6,391,825 2.52


136

THIRTY (30) LARGEST SHAREHOLDERS AS AT 31 MAY 2012

No. of Name of Shareholders Shares Held %

12. Kenanga Nominees (Tempatan) Sdn. Bhd. 6,000,000 2.37 - Pledged Securities Account for Alpretz Capital Sdn. Bhd.

13. Lembaga Tabung Angkatan Tentera 5,373,033 2.12

14. Kenanga Nominees (Tempatan) Sdn. Bhd. 4,961,250 1.96 - Pledged Securities Account for Ong Kar Beau 15. Distinct Continent Sdn. Bhd. 4,700,000 1.85

16. Kenanga Nominees (Tempatan) Sdn. Bhd. 4,200,000 1.66 - Pledged Securities Account for Cipta Nirwana (M) Sdn. Bhd.

17. A.A. Anthony Nominees (Tempatan) Sdn. Bhd. 4,134,375 1.63 - Pledged Securities Account for Ng Ai Loo

18. OSK Nominees (Tempatan) Sdn. Bhd. 3,465,125 1.37 - Bank of China (Malaysia) Berhad Pledged Securities Account for Ong Kar Beau

19. Al Wakalah Nominees (Tempatan) Sdn. Bhd. 3,439,643 1.36 - Pledged Securities Account for Cipta Nirwana (M) Sdn. Bhd.

20. Maybank Nominees (Tempatan) Sdn. Bhd. 2,943,305 1.16 - Pledged Securities Account for Siow Yoon Keong

21. HLB Nominees (Asing) Sdn. Bhd. 2,414,475 0.95 - Southern Dynamic Consultants Limited (CSD SIN/SDCL)

22. Berjaya Philippines Inc. 1,990,000 0.78

23. CIMSEC Nominees (Asing) Sdn. Bhd. 1,800,000 0.71 - CIMB Bank for Chew Soo Lin (M78022)

24. Muhammad Adib Bin Khalid 1,500,000 0.59

25. A.A. Anthony Nominees (Asing) Sdn. Bhd. 1,465,004 0.58 - Pledged Securities Account for Chew Soo Lin

26. Citigroup Nominees (Tempatan) Sdn. Bhd. 1,428,288 0.56 - UBS AG Singapore for Siow Yoon Keong

27. Syed Sirajuddin Putra Jamalullail 1,349,241 0.53

28. HSBC Nominees (Asing) Sdn. Bhd. 1,306,375 0.52 - AA Noms SG for Zheng Ling 29. Maybank Nominees (Tempatan) Sdn. Bhd. 1,267,875 0.50 - Hadrons Capital Sdn. Bhd. for E-Fos Sdn. Bhd. (290575)

30. Maybank Nominees (Tempatan) Sdn. Bhd. 1,232,155 0.49 - Pledged Securities Account for Stuart Saw Teik Siew

Analysis of Shareholdings (cont’d)as at 31 May 2012

137

Location Description Existing UseTenure/Expiry Date

Age of Building

Approx Areas

Net Book Value

as at 29 February

2012Years Sq Metre RM’mil

1 Lot No. 1, Section 63, Town of Kuala Lumpur, Wilayah Persekutuan

Office building, hotel apartment building and building under construction

Registered office, office block for rent and hotel apartments for letting

Leasehold (60 years - expiring 2038) renewable for a further 30 years

Office building

(27),Hotel

apartment (16)

18,701.20 84.23

2 i) Lot PTB 10707 ii) Lot PTB 20006, PTB 20380 & PTB 20438 & PTD 146378 and PTD 148062, Town of Johor Bahru and Mukim Plentong, Johor Bahru, Johor Darul Takzim

Integrated Commercial Duty Free Complex - Duty Free Zone

Shopping complex, hotel facilities, carpark, hotel, custom and immigration cum office complex, jetty and restaurant and surface car parks

i) Leasehold (99 years - expiring2092)

ii) Leasehold(99 years - expiring 2092)

14 57,354.07 160.74

3 Lot PTB 10710, Town of Johor Bahru and Mukim Plentong, Johor Bahru, Johor Darul Takzim

Vacant land Vacant land Leasehold (99 years - expiring 2092)

N/A 28,884.44 14.95

4 Lot 1071, Mukim 11, Seberang Perai Tengah, Pulau Pinang Darul Mutiara

Double storey private bonded warehouse

Rented out Freehold 17 29,234.00 5.43

5 Lot PT 482 HS(M) 19/1981, Mukim Sungai Laka, Daerah Kubang Pasu, Kedah Darul Aman

Double storey shophouse

Staff quarters Leasehold (99 years - expiring 2080)

25 297.00 0.11

6 Lot 2224 HS(M) 1/1987, PT 1443, Bukit Kayu Hitam, Mukim Sungai Laka, Daerah Kubang Pasu, Kedah Darul Aman

A single storey warehouse annexed to a double storey shopping complex and 30 units of single storey lock-up shops and ancillary building

Duty Free shopping complex and warehouse

Leasehold (30 years – expiring 2017)

24 20,234.00 3.13

List of Propertiesas at 29 February 2012


138


Age of Building

Approx Areas

Net Book Value

as at 29 February


7 Lot 127-142 &169-174, PT 1889-1904 & 1931-1936, HS(M) 135/1989- 150/1989 & 177/1989-182/1989, Bandar Baru Laka Temin, Mukim Sungai Laka, Daerah Kubang Pasu, Kedah Darul Aman

22 units single storey terrace house

Staff quarters Leasehold (99 years - expiring 2088)

19 3,216.00 0.59

8 Lot 475, Seksyen 1, Bandar Batu Ferringhi, Daerah Timur Laut, Pulau Pinang Darul Mutiara

Vacant land Vacant land Freehold N/A 2,346.00 0.31

9 Lot 481,Geran 67421,Mukim 17, Daerah Timur Laut, Pulau Pinang Darul Mutiara

Vacant land Vacant land Freehold N/A 8,974.00 –

10 Lot 3688, 3689 &PT 2209, Bukit Kayu Hitam, Mukim Sungai Laka, Daerah Kubang Pasu, Kedah Darul Aman

Vacant land, part of which is Golf and Country Club

Rented out and partly vacant

Leasehold (60 years - expiring 2053 and 2057)

14 3,127,220.00 37.85

11 Lot 44 Premises No. 42/1/2&3, Kompleks Munshi Abdullah, Jalan Munshi Abdullah, 75100 Melaka Darul Azim

4 & 1/2 storey shophouse

Business and office premises

Leasehold (99 years - expiring 2084)

27 130.00 0.44

12 Lot 970, 971, 973 & 1556, Mukim Kedawang, Daerah Langkawi, Kedah Darul Aman

Shopping complex

Duty Free Complex


17 2,548.00 1.46

List of Properties (cont’d)as at 29 February 2012

139


Age of Building

Approx Areas

Net Book Value

as at 29 February


13 Lot 4720,Mukim Titi Tinggi, 2 Jalan Baru Sadao, 02100 Padang Besar, Perlis Darul Sunnah

Store Store Leasehold (60 years - expiring 2054)

18 1,003.00

11.54

14 Lot 3548,Mukim Titi Tinggi, 2 Jalan Baru Sadao, 02100 Padang Besar, Perlis Darul Sunnah

Warehouse annexed to a single storey shopping complex

Duty Free Complex and warehouse


20 3,545.00

15 Lot 2063, Mukim Titi Tinggi, Padang Besar, 30 Bangunan PKENPs, Jalan Besar, 02100 Padang Besar, Perlis Darul Sunnah

Shop Shop Freehold 25 223.00 0.21

16 Shop Lot Nos 47 & 48,Mukim Titi Tinggi, Padang Besar, 3D & 4D Kompleks Arked Niaga PKENPs, 02100 Padang Besar, Perlis Darul Sunnah

Shop Shop Leasehold (99 years - expiring 2090)

22 58.00 0.25

17 PN 108045,Lot 4858, Mukim Pengkalan Hulu, District of Hulu Perak, Perak Darul Ridzuan

Duty Free Complex

Duty Free Complex


22 10,116.00 8.90

18 Lot No. 4998 & 5017, Mukim Kapar, District of Klang, Selangor Darul Ehsan

Industrial premises

Factories, office and ancillary buildings

Freehold 8 - 27 24,154.64 9.13

19 PT 1644, Town of Hulu Bernam, District of Hulu Selangor, Selangor Darul Ehsan

Vacant industrial land

Vacant land Leasehold (99 years - expiring 2096)

N/A 57,085.00 0.95

20 Lot No. 5080, Mukim Kapar, District of Klang, Selangor Darul Ehsan

Industrial premises

Warehouse and office building

Freehold 15 12,014.09 6.26

21 Lot No PT 54755 & Lot No PT 54753, Mukim Kapar, District of Klang, Selangor Darul Ehsan

Industrial premises

Factory, office and warehouse

Freehold 9 - 34 48,562.22 21.31



140


Age of Building

Approx Areas

Net Book Value

as at 29 February


22 Lot no PT 6731, Kawasan Perindustrian Berat Gurun, Mukim Gurun, District of Kuala Muda, Kedah Darul Aman

Industrial premises

Rented out Leasehold (60 years)

5 43,541.33 2.60

23 Lot 752 & 795 HS(D) 11858, Mukim 17, Bandar Batu Ferringhi, Daerah Timur Laut, Pulau Pinang Darul Mutiara

Double storey semi-detached

Rented out Freehold 11 447.97 0.30

24 Lot 815 HS(D) 11858, Mukim 17, Bandar Batu Ferringhi, Daerah Timur Laut, Pulau Pinang Darul Mutiara

Double storey semi-detached

Rented out Freehold 11 459.03 0.32

25 Lot 303 (Geran 46814) & 340 (Geran 46821) Seksyen 1, Mukim 17, Daerah Timur Laut, Bandar Batu Ferringhi, Daerah Timur Laut, Pulau Pinang Darul Mutiara

Vacant land for development

Vacant land with single storey sales office

Freehold N/A 11,266.63 9.20

26 Lot PT 5607 & 5608, Bandar Sri Sendayan, Daerah Seremban, Negeri Sembilan Darul Khusus

Vacant land Vacant land Freehold N/A 647,497.00 52.30

27 8 Persiaran Kampung Jawa, No Hakmilik 6711,Lot 9891, Mukim 12, Daerah Barat Daya, Pulau Pinang Darul Mutiara

Factory land and building

Business and office premises

Leasehold (60 years expiring 2054)

15 4,355.00

4.70

28 Pajakan Negeri No 3839, Lot no 11618, Mukim 12, Daerah Barat Daya, Pulau Pinang Darul Mutiara

Factory land Business and office premises

Leasehold (60 years expiring 2058)

N/A 1,106.00


141

Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN THAT the Twenty-Third Annual General Meeting of Atlan Holdings Bhd. will be held at the Meeting Room, Wisma Atlan, 8 Persiaran Kampung Jawa, 11900 Bayan Lepas, Penang on Tuesday, 31 July 2012 at 11.30 a.m. for the following purposes:-

AGENDA

1. To receive the Audited Financial Statements for the financial year ended 29 February 2012 together with the Directors’ and Auditors’ Report thereon.

2. To approve the payment of Directors’ fees of RM150,000 for the financial year ended 29 February 2012.

3. To re-elect the following Directors who retire in accordance with Article 78 of the Company’s Articles of Association and being eligible, have offered themselves for re-election:-

a) Tengku Abdul Rahman Ibni Sultan Haji Ahmad Shah Al-Mustain Billah, DK II., SSAP b) Mr. Lee Sze Siang

4. To consider and if thought fit, to pass the following resolution pursuant to Section 129(6) of the Companies Act, 1965 as an ordinary resolution:-

“That En. Mohd Sharif Bin Hj Yusof, retiring in accordance with Section 129 of the Companies Act, 1965, be and is hereby re-appointed as Director of the Company and to hold office until the conclusion of the next Annual General Meeting of the Company.”

5. To re-appoint Messrs Ernst & Young as Auditors of the Company until the conclusion of the next Annual General Meeting and to authorise the Directors to fix their remuneration.

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

a) Ordinary Resolution Authority to issue and allot shares pursuant to Section 132D of the Companies Act,

1965 (“Proposed Authority to issue Shares”)

“THAT subject to Section 132D of the Companies Act, 1965, the Articles of Association of the Company and approvals of the relevant governmental or regulatory authorities, the Directors be and are hereby empowered to issue and allot shares in the capital of the Company, at any time to such persons 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 10% of the issued and paid-up share capital of the Company for the time being and 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 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.”

b) Special Resolution Proposed Amendments to the Articles of Association of the Company (“Proposed

Amendments”)

“THAT the amendments to the Articles of Association of the Company as set out in the Appendix I annexed to the Annual Report 2012 be and are hereby approved and adopted AND THAT the Board of Directors be and is hereby authorised to give effect to the said amendments.”

7. To transact any other business of which due notice shall have been given in accordance with the Companies Act, 1965 and the Company’s Articles of Association.

Resolution 1

Resolution 2

Resolution 3 Resolution 4

Resolution 5

Resolution 6

Resolution 7

Resolution 8


142

By Order of the Board,

CHUA SIEW CHUAN (MAICSA 0777689)THUM SOOK FUN (MAICSA 7025619)Company Secretaries

Date: 6 July 2012

EXPLANATORY NOTES TO SPECIAL BUSINESS

Resolution 7 - Proposed Authority to issue Shares

The proposed Resolution 7 is primarily to give a renewal mandate to the Directors to issue and allot shares at any time to such persons in their absolute discretion without convening a general meeting provided that the aggregate number of shares issued does not exceed 10% of the issued and paid-up share capital of the Company for the time being.

The renewal of the above mandate will provide flexibility to the Company for allotment of shares for any possible fund raising activities, including but not limited to further placing of shares, for the purpose of funding future investment project(s), working capital and / or acquisitions. This authority, unless revoked or varied at a general meeting, will expire at the next Annual General Meeting (“AGM”) of the Company.

As at the date of this Notice, no new shares were issued pursuant to the mandate granted to the Directors at the last AGM held on 28 July 2011 and it will lapse at the conclusion of the Twenty-Third AGM.

Resolution 8 - Proposed Amendments

Proposed adoption of Resolution 8 is to comply with the amendments to the Main Market Listing Requirements of Bursa Malaysia Securities Berhad and to update the Articles of Association of the Company to be consistent with the prevailing laws, guidelines or requirements of the relevant authorities.

Notes:-

1. In respect of deposited securities, only members whose names appear in the Record of Depositors on 25 July 2012 (“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 more than one (1) proxy to attend and vote in his or her stead. Where a member appoints more than one proxy, 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 of the Company and the provisions of Section 149 (1)(b) of the Companies Act, 1965 shall not apply to the Company. Notwithstanding this, a member entitled to attend and vote at the Meeting is entitled to appoint any person as his proxy to attend and vote instead of the member at the Meeting. There shall be no restriction as to the qualification of the proxy. 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 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 must be deposited at the Company’s registered office at Level 4, Wisma Atlan, 8, Persiaran Kampung Jawa, 11900 Bayan Lepas, Penang, not less than 48 hours before the time for holding the meeting or any adjournment thereof.

STATEMENT ACCOMPANYING 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) at this forthcoming Annual General Meeting.

Notice of Annual General Meeting (cont’d)

143

SPECIAL RESOLUTION- Proposed Amendments to the Articles of Association

The Articles of Association of the Company are proposed to be amended in the following manner :

ArticleNo. Existing Article Amended Article

2 WORDS MEANINGS WORDS MEANINGS

Central Depositories Act

New definition

Securities

New definition

-

-

The Secur i t ies Indus t r y (Central Depositories) Act 1991

Debentures, stocks and shares of the Company and includes any righr of option in respect thereof.

Central Depositories Act

Dividend Reinvestment Scheme

Securities

ExemptAuthorisedNominee

-

-

-

-

The Securities Industry (Central Depositories) Act 1991 as amended from time to time and any re-enactment thereof.

Shall have the same meaning given under Paragraph 1.01 of the Listing Requirements.

Shall have the meaning given in Section 2 of the Capital Markets and Services Act, 2007.

Means an authorised nominee defined under the Central Depositories Act, which is exempted from compliance with the provision of subsection 25A(1) of the Central Depositories Act.

72. Instrument appointing proxy to be in writing

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 Seal or under hand of an officer, or attorney duly authorised. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Act shall not apply to the Company. The instrument appointing a proxy shall be deemed to confer authority to more than two proxies to attend at the same meeting. Where a member appoints two or more proxies, he shall specify the proportion of his shareholdings to be represented to each proxy.

Instrument appointing proxy to be in writing

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 Seal or under hand of an officer, or attorney duly authorised. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Act shall not apply to the Company and there shall be no restriction as to the qualification of the proxy. The instrument appointing a proxy shall be deemed to confer authority to more than two proxies to attend at the same meeting. Where a member appoints two or more proxies, he shall specify the proportion of his shareholdings to be represented to each proxy. A proxy appointed to attend and vote at a meeting of the Company shall have the same rights as members to speak at the general meeting.

Appendix I


144

ArticleNo. Existing Article Amended Article

72A Authorised nominee

Where a member of the company is an authorised nominee as defined under the Central Depositories Act, it may appoint at least one proxy in respect of each securities account it holds with ordinary shares of the company standing to the credit of the said securities account.

Exempt authorised nominee

Where a member of the Company is an exempt authorised nominee 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.

140A New Provision Dividend Reinvestment Scheme

Subject to the approval being obtained from the members of the Company and the Listing Requirements, the Company may issue shares pursuant to a Dividend Reinvestment Scheme to all its members who are entitled to dividend in accordance with the provisions of the Act and any rules, regulations and guidelines there under or issued by the Exchange and any other relevant authorities in respect thereof.

[End of Appendix I]

Appendix I (cont’d)

145

✄

I/We ____________________________________________ NRIC No./Company No. ___________________________ (full name in block letters)

of __________________________________________________________________________________________________ (full address)

being a member of ATLAN HOLDINGS BHD (173250-W) hereby appoint _______________________________

________________________________________________ of _________________________________________________

or failing him, ________________________________________ of ___________________________________________or failing *him/her, the Chairman of the meeting as *my/our proxy to vote for *me/us on *my/our behalf at the Twenty-Third Annual General Meeting of the Company to be held at the Meeting Room, Wisma Atlan, 8 Persiaran Kampung Jawa, 11900 Bayan Lepas, Penang on Tuesday, 31 July 2012 at 11.30 a.m. and at any adjournment thereof.

Please indicate your vote by a (X) in the respective box of each resolution. If no specific direction as to voting is given, the proxy will vote or abstain from voting on the resolutions at his/her discretion.

AS ORDINARY BUSINESS: For Against

Resolution 1 To receive the Audited Financial Statements for the financial year ended 29 February 2012 together with the Directors’ and Auditors’ Report thereon.

Resolution 2 To approve the payment of Directors’ fees of RM150,000.

Resolution 3 To re-elect Tengku Abdul Rahman Ibni Sultan Haji Ahmad Shah Al-Mustain Billah, DK II., SSAP as Director of the Company.

Resolution 4 To re-elect Mr. Lee Sze Siang as Director of the Company.

Resolution 5 To re-appoint En. Mohd Sharif Bin Hj Yusof as Director of the Company pursuant to Section 129 of the Companies Act, 1965.

Resolution 6 To re-appoint Messrs Ernst & Young as Auditors of the Company.

AS SPECIAL BUSINESS:

Resolution 7 To approve the Proposed Authority to issue Shares.

Resolution 8 To approve the Proposed Amendments to the Articles of Association.

* Strike out whichever not applicable

As witness *my/our hand(s) this ____________ day of ___________________, 2012.

__________________________________Signature of Shareholder(s)

No. of Shares Held

Notes:-1. In respect of deposited securities, only members whose names appear in the Record of Depositors on 25 July 2012 (“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 more than one (1) proxy to attend and vote in his

or her stead. Where a member appoints more than one proxy, 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 of the Company and the provisions of Section 149 (1)(b) of the Companies Act, 1965 shall not apply to the Company. Notwithstanding this, a member entitled to attend and vote at the Meeting is entitled to appoint any person as his proxy to attend and vote instead of the member at the Meeting. There shall be no restriction as to the qualification of the proxy. 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 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 must be deposited at the Company’s registered office at Level 4, Wisma Atlan, 8, Persiaran Kampung Jawa, 11900 Bayan Lepas, Penang, not less than 48 hours before the time for holding the meeting or any adjournment thereof.

7. Any alteration in this form must be initialed.

FORM OF PROXY

COMMONSEAL

Fold this flap for sealing

Then fold here

1st fold here

THE COMPANY SECRETARIESATLAN HOLDINGS BHD

(Company No.: 173250-W)Level 4, Wisma Atlan

8 Persiaran Kampung Jawa11900 Bayan LepasPenang, Malaysia

AFFIXPOSTAGE

STAMP

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