SBC Corporation Berhad: Annual Report 2003 1400kb

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SBC Corporation Berhad: Annual Report 2003 1400kb

  1. 1. SIAH BROTHERS CORPORATION BERHAD ...Building Homes... ...Building Communities... ...Building Partnerships... ...Building Value... COVER RATIONALE Signifies that we are in a business that involves people, and how well we do will depend a great deal both on our internal alignment as well as alignment to the high goals that we need to set for ourselves; to stand apart from the competition. ANNUAL REPORT 2003 SIAH BROTHERS CORPORATION BERHAD (199310-P) SIAH BROTHERS CORPORATION BERHAD Wisma Siah Brothers, 74A Jalan Pahang 53000 Kuala Lumpur 199310-P Tel: 03-40418118 Fax: 03-40435281 A n n u a l R e p o r t 2 0 0 3
  2. 2. a...InvestmentHolding... ...Investment Holding... ...Turnkey Construction... BATANG KALI ...Planned Communities... Bandar Utama, Batang Kali KOTA KINABALU • The Peak, Signal Hill • Signal Hill Park BATU CAVES Paling’s Products KUALA LUMPUR Taman Mastiara Perlis Kedah Pulau Pinang Kuantan Terengganu KUANTAN Sabah Perak Perkampungan Seri Mahkota Aman Pahang Selangor Negeri Sarawak Sembilan Melaka Johor KLANG Taman Suria Perdamar DAMANSARA Taman Damansara Emas ONGOING PROJECT
  3. 3. CORE PURPOSE To continue to be a pioneering building company, committed to advancing Malaysian living standards through the planning, construction and delivery of worthy buildings and vibrant communities. CORE BELIEFS ...an established tradition of conducting our business to the industry’s highest ethics/practices; ...use of designs and processes that advance standards; ...equipping our people in order to provide lasting value to our customers/stakeholders. Corporate Section Contents Notice Of Annual General Meeting 2 Notice of Dividend Payment 3 Statement Accompanying Notice of Annual General Meeting 3 Annexure A - Letter of Nomination of Auditors 4 Corporate Information 5 Directors’ Profile 6 Corporate Structure 13 Group Financial Highlights 14 Statement Of Directors’ Responsibilities 15 Executive Chairman’s Statement 16 Penyata Pengerusi Eksekutif 20 Statement Of Corporate Governance 24 Statement On Internal Control 30 Audit Committee Report 31 Group Properties 78 Shareholders’ Information 80 TSR Holders’ Information 82 Proxy Form Financial Statements 35-77
  4. 4. Notice Of Annual General Meeting NOTICE IS HEREBY GIVEN that the Thirteenth Annual General Meeting of Siah Brothers Corporation Berhad will be held at the Penthouse, 5th Floor, Wisma Siah Brothers, 74, Jalan Pahang, 53000 Kuala Lumpur on Friday, 26 September 2003 at 11.00 a.m. to transact the following business: AGENDA 1. To receive and adopt the Directors’ Report and the Audited Financial Statements for the year (Resolution 1) ended 31 March 2003 together with the Auditors’ Report thereon. 2. To declare a first and final dividend of 1% less 28% income tax for the year ended (Resolution 2) 31 March 2003. 3. To approve the payment of Directors’ fees. (Resolution 3) 4. To re-appoint the following Directors pursuant to Section 129(6) of the Companies Act, 1965: (a) YBhg. Dato’ Lim Phaik Gan (Resolution 4) (b) Mr. Sia Kwee Mow @ Sia Hok Chai (Resolution 5) 5. To re-elect YBhg. Dato’ Dr. Norraesah Bt. Haji Mohamad as a Director retiring by rotation (Resolution 6) pursuant to Article 77 of the Articles of Association of the Company. 6. To appoint Auditors and to authorise the Directors to fix their remuneration. (Resolution 7) Notice of nomination pursuant to Section 172(11) of the Companies Act, 1965, a copy of which is annexed hereto and marked as “Annexure A”, has been received by the Company from a shareholder, LOM Holdings Sdn. Bhd. for the nomination of M/s. Horwath, who have given their consent to act, as Auditors of the Company and of their intention to propose the following Ordinary Resolution at the meeting: “THAT M/s Horwath be appointed as Auditors of the Company in place of the retiring Auditors, M/s. Horwath Mok & Poon, at a remuneration to be fixed by the Directors and to hold office until the conclusion of the next Annual General Meeting”. 7. As Special Business, to consider and, if thought fit, to pass the following resolutions: (A) ORDINARY RESOLUTION (Resolution 8) AUTHORITY TO DIRECTORS TO ALLOT AND ISSUE SHARES Notice of Annual General Meeting “THAT subject always to the Companies Act, 1965, the Articles of Association of the Company and the approval from the Kuala Lumpur Stock Exchange and other governmental/regulatory bodies, where such approval shall be necessary, the Directors be and are hereby authorised pursuant to Section 132D of the Companies Act, 1965, to allot and issue shares in the Company, at any time and upon such terms and conditions and for such purposes as they may in their absolute discretion deem fit, provided that the aggregate number of shares issued pursuant to this resolution does not exceed ten per cent (10%) of the issued capital of the Company for the time being and that such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company.” (B) SPECIAL RESOLUTION (Resolution 9) APPROVAL FOR PROPOSED CHANGE OF NAME OF THE COMPANY “THAT the change of name of the Company from Siah Brothers Corporation Berhad to SBC Corporation Berhad (effective upon the issuance of the Certificate of Incorporation on Change of Name of Company by the Companies Commission of Malaysia) be and is hereby approved and that all references in the Memorandum and Articles of Association of the Company to the name Siah Brothers Corporation Berhad, wherever the same may appear, shall be substituted with the name SBC Corporation Berhad.” 8. To consider any other business for which due notice shall have been given. 2 Annual Report 2003
  5. 5. Notice Of Dividend Payment NOTICE IS HEREBY GIVEN that subject to the approval of the shareholders at the Thirteenth Annual General Meeting of the Company, the first and final dividend of 1% less 28% income tax for the year ended 31 March 2003 will be paid on 31 October 2003 to Depositors registered in the Record of Depositors on 17 October 2003. A Depositor shall qualify for entitlement only in respect of: a) shares transferred into the Depositor’s Securities Account before 4.00 p.m. on 17 October 2003 in respect of ordinary transfers; and b) shares bought on the Kuala Lumpur Stock Exchange on a cum entitlement basis according to the Rules of the Kuala Lumpur Stock Exchange. NOTES: 1) Proxy: 2) Resolution 8: By Order of the Board A member entitled to attend and vote at the The Company is actively pursuing business Meeting is entitled to appoint a proxy to attend and opportunities in prospective areas so as to vote instead of him. Where a member appoints broaden the operating base and earnings more than one (1) proxy, the appointment shall be potential of the Company. Such expansion plans invalid unless he specifies the proportions of his may require the issue of new shares not holdings to be represented by each proxy. To be exceeding 10 per cent (10%) of the Company’s CHONG FOOK SIN valid, the proxy form duly completed must be issued share capital. With the passing of the deposited at the Registered Office of the resolution by the shareholders of the Company at KAN CHEE JING Company not less than forty-eight (48) hours the forthcoming Annual General Meeting, the Company Secretaries before the time for holding the meeting. If the Directors would avoid delay and cost of convening appointor is a corporation, this form must be further general meetings to approve the issue of executed under its common seal or under the shares for such purposes. hand of its attorney. Kuala Lumpur 3) Resolution 9: 3 September 2003 The proposed change of name from Siah Brothers Corporation Berhad to SBC Corporation Berhad is to better reflect the corporate identity of the Company. Statement Accompanying Notice of Annual General Meeting Statement Accompanying Notice of Annual General Meeting pursuant to paragraph 8.28 (2) of the Listing Requirements of Kuala Lumpur Stock Exchange (1) The following are the Directors standing for re-appointment and re-election at the Thirteenth Annual General Meeting: (a) Re-appointment of the following Directors pursuant to Section 129(6) of the Companies Act, 1965: (i) YBhg. Dato’ Lim Phaik Gan (ii) Mr. Sia Kwee Mow @ Sia Hok Chai (b) Re-election of YBhg. Dato’ Dr. Norraesah Bt. Haji Mohamad as a Director pursuant to Article 77 of the Articles of Association of the Company. (2) Attendance of Directors at Board Meetings held during the financial year ended 31 March 2003 are as follows: Attendance Percentage of Name of Directors at Meetings Attendance (%) Sia Kwee Mow @ Sia Hok Chai 4/4 100 Sia Teong Heng 4/4 100 Mun Chong Shing @ Mun Chong Tian 3/4 75 Dato’ Lim Phaik Gan 2/4 50 Dato’ Dr. Norraesah Bt. Haji Mohamad 2/4 50 Datuk Sim Peng Choon (Resigned on 19 August 2003) 4/4 100 Abdul Rahman Bin A. Shukor (Alternate to Datuk Sim Peng Choon - ceased on 19 August 2003) 2/4 50 Vincent Koh Kok Kee (Resigned on 31 May 2003) 4/4 100 Tan Sri Dato’ Ir. Muhammad Yusuff Bin Haji 1/1 100 Muhammad Yunus (Resigned on 14 August 2002) (3) The Thirteenth Annual General Meeting will be held at the Penthouse, 5th Floor, Wisma Siah Brothers, 74, Jalan Pahang, 53000 Kuala Lumpur on Friday, 26 September 2003 at 11.00 a.m. (4) The profile of Directors standing for re-appointment and re-election as mentioned in paragraph 1 above at the Thirteenth Annual General Meeting are set out in page 6 to 12 of this Annual Report. Siah Brothers Corporation Berhad (199310-P) 3
  6. 6. Annexure A Letter of Nomination of Auditors 8 August 2003 The Board of Directors Siah Brothers Corporation Berhad Wisma Siah Brothers, 74A, Jalan Pahang, 53000 Kuala Lumpur. Dear Sirs, NOMINATION OF AUDITORS Pursuant to Section 172(11) of the Companies Act, 1965, we, being a shareholder of the Company, hereby give notice of nomination of M/s. Horwath as Auditors of the Company in place of the retiring Auditors, M/s. Horwath Mok & Poon, and of our intention to propose the following as an ordinary resolution at the forthcoming Annual General Meeting of Siah Brothers Corporation Berhad: “THAT M/s Horwath be appointed as Auditors of the Company in place of the retiring Auditors, M/s. Horwath Mok & Poon, at a remuneration to be fixed by the Directors and to hold office until the conclusion of the next Annual General Meeting.” Yours truly, LOM HOLDINGS SDN. BHD. Notice of Annual General Meeting Sia Kwee Mow @ Sia Hok Chai Director 4 Annual Report 2003
  7. 7. Corporate Information as at 8 August 2003 Board Of Directors Sia Kwee Mow @ Sia Hok Chai Sia Teong Heng JMN, FFB, FCIOB, FAIB B.Sc. (Eng), M.Sc. Executive Chairman Managing Director Mun Chong Shing @ Mun Chong Tian Dato’ Lim Phaik Gan Non-Executive Director DPMP, DMPN, M.A. (Law), FCI, ARB Independent Non-Executive Director Datuk Sim Peng Choon PJN Dato’ Dr. Norraesah Bt. Haji Mohamad Non-Executive Director DSPN, PhD., B.Sc. (Econ) Independent Non-Executive Director Abdul Rahman Bin A. Shukor B.Sc (Civil & Environmental Eng.), Executive MBA Non-Executive Director (Alternate to Datuk Sim Peng Choon) Audit Committee Solicitors Dato’ Dr. Norraesah Bt. Haji Mohamad Cheang & Ariff DSPN, PhD., B.Sc. (Econ) 39 Court Chairperson & 39, Jalan Yap Kwan Seng Independent Non-Executive Director 50450 Kuala Lumpur Datuk Sim Peng Choon Lim & Yeoh PJN Non-Executive Director 145-M Jalan Maharajalela 50150 Kuala Lumpur Company Secretaries Lee, Perara & Tan Chong Fook Sin 55, Jalan Thambapillai ATII, MCCS, AFA Off Jalan Tun Sambanthan Brickfields Kan Chee Jing 50470 Kuala Lumpur ACIS Principal Bankers Registered Office Affin Merchant Bank Berhad Wisma Siah Brothers Alliance Bank Malaysia Berhad 74A Jalan Pahang Aseambankers Malaysia Berhad 53000 Kuala Lumpur Bangkok Bank Berhad Tel : 03 - 4041 8118 Bumiputra Commerce Bank Berhad Fax : 03 - 4043 5281 Corporate Information United Overseas Bank (Malaysia) Berhad Utama Merchant Bank Berhad Auditors Horwath Mok & Poon Registrars Chartered Accountants Tacs Corporate Services Sdn. Bhd. Level 16 Tower C Unit No. 203, 2nd Floor Megan Phileo Avenue Block C, Damansara Intan 12 Jalan Yap Kwan Seng No. 1, Jalan SS 20/27 50450 Kuala Lumpur 47400 Petaling Jaya Tel : 03 - 7118 2688 Fax : 03 - 7118 2693 Stock Exchange Listing Main Board Kuala Lumpur Stock Exchange Siah Brothers Corporation Berhad (199310-P) 5
  8. 8. Directors’ Profile as at 31 July 2003 SIA KWEE MOW @ SIA HOK CHAI Sia Kwee Mow @ Sia Hok Chai, a Malaysian, aged 70, is the Executive Chairman of Siah Brothers Corporation Berhad (“SBC”). He has been a Director of SBC since its incorporation on 14 June 1990. He has over 49 years of experience in building and civil engineering contracting and not less than 31 years of experience in plastic engineering since the incorporation of Paling Industries Sdn. Bhd. in 1971. He was actively involved in Master Builders Association Malaysia (“MBAM”) and had served in various capacities including the post of President (1988 to 1994). He was elected as the 29th President (1994 to 1996) of the International Federation of Asian and Western Pacific Contractors’ Associations (“IFAWPCA”) during which he led the IFAWPCA delegation to a meeting between the World Bank and International Contractors Association held at Washington D.C. in November 1996. In recognition of his vast experience and knowledge in construction and his contribution to the building construction industry, he was awarded or conferred the following: • Johan Mangku Negara by DYMM Yang DiPertuan Agong in 2001 • Honorary Life President by MBAM in 2001 • Fellowship of the Faculty of Building, United Kingdom in 1981 • Fellowship of the Chartered Institute of Building, United Kingdom as a Chartered Builder in 1979 • Fellowship of the Australian Institute of Building by the Australian Royal Charter of Building in 1982 He was also a previous President of both the Selangor Builders Association and Selangor Chinese Plumbing and Sanitary Association. He also sits on the board of several private limited companies in Malaysia, including several subsidiaries of SBC. His holdings in the securities of SBC are as follows: Direct Interest Indirect Interest Ordinary shares 1,480,800 (a) 19,498,523 (b) Transferable Subscription Rights (“TSR”) 3,078,500 1,746,780 (c) Employees’ Shares Option Scheme 450,000 - (a) 1,480,800 shares are held in bare trust by RHB Capital Nominees (Tempatan) Sdn. Bhd. (b) Deemed interest by virtue of his shareholding in LOM Holdings Sdn. Bhd. (14,317,500 shares) and Evergreen Legacy Sdn. Bhd. (5,181,023 shares). (c) Deemed interest by virtue of his shareholding in Evergreen Legacy Sdn. Bhd. (1,696,580 TSR) and Perfect Consistence Sdn. Bhd. (50,200 TSR). By virtue of his interests in SBC, he is deemed to have interests in the securities of SBC’s subsidiaries to the extent of SBC’s interest in accordance with Section 6A of the Companies Act, 1965. He is the father of Sia Teong Heng, the Managing Director and a major shareholder of SBC. Directors’ Profile He does not have any conflict of interest with SBC except for those transactions disclosed in Note 45 to the financial statements. He has not been convicted of any offence within the past 10 years. He attended all the four Board Meetings held during the last financial year. 6 Annual Report 2003
  9. 9. SIA TEONG HENG Sia Teong Heng, a Malaysian, aged 40, is the Managing Director of Siah Brothers Corporation Berhad (“SBC”). He was appointed as a Director of SBC on 5 February 1991. On 27 November 2001, he resigned as a member of the Audit Committee of SBC. He is a member of the Remuneration Committee of SBC. He graduated in 1985 with a degree in Bachelor of Science in Civil Engineering from Loughborough University, United Kingdom ("UK") and a Master degree in Management Science from Imperial College, University of London, UK in 1986. His career began in investment banking in 1987 with Morgan Grenfell (Asia) Ltd., Singapore. He joined SBC in 1991. Presently, he also sits on the boards of several subsidiaries of SBC. His holdings in the securities of SBC are as follows: Direct Interest Indirect Interest Ordinary shares 334,992 19,498,523 (a) Transferable Subscription Rights (“TSR”) - 1,746,780 (b) Employees’ Shares Option Scheme 350,000 - (a) Deemed interest by virtue of his shareholding in LOM Holdings Sdn. Bhd. (14,317,500 shares) and Evergreen Legacy Sdn. Bhd. (5,181,023 shares). (b) Deemed interest by virtue of his shareholding in Evergreen Legacy Sdn. Bhd. (1,696,580 TSR) and Perfect Consistence Sdn. Bhd. (50,200 TSR). By virtue of his interests in SBC, he is deemed to have interests in the securities of SBC’s subsidiaries to the extent of SBC’s interest in accordance with Section 6A of the Companies Act, 1965. He is a son of Sia Kwee Mow @ Sia Hok Chai, the Executive Chairman and a major shareholder of SBC. He does not have any conflict of interest with SBC except for those transactions disclosed in Note 45 to the financial statements. He has not been convicted of any offence within the past 10 years. He attended all the four Board Meetings held during the last financial year. Directors’ Profile Siah Brothers Corporation Berhad (199310-P) 7
  10. 10. MUN CHONG SHING @ MUN CHONG TIAN Mun Chong Shing @ Mun Chong Tian, a Malaysian, aged 66, was appointed as an Executive Director of Siah Brothers Corporation Berhad ("SBC") on 1 April 1996 when he was employed as General Manager of Paling Industries Sdn. Bhd. (“Paling”) from 1987 and appointed as a Director in 1991 and remained in both positions until his retirement on 31 December 2001. On 31 December 2001, he was redesignated as a Non-Executive Director of SBC. He is a member of the Nomination Committee of SBC. He has received training in Sales Management conducted by the National Productive Centre and the Malaysian Institute of Management and a General Management Programme at the National Productivity Board, Singapore. Prior to his involvement with Paling, he was employed as General Manager in Hume Industries (M) Bhd. where he has had extensive exposure to industrial engineering and management. His holdings in the securities of SBC are as follows: Direct Interest Indirect Interest Ordinary shares 21,782 - Transferable Subscription Rights 12,500 - He does not hold any securities, direct or indirect, in any of SBC’s subsidiaries. He is a brother-in-law to Sia Kwee Mow @ Sia Hok Chai and an uncle to Sia Teong Heng, both are Directors and major shareholders of SBC. He does not have any conflict of interest with SBC. He has not been convicted of any offence within the past 10 years. He attended three of the four Board Meetings held during the last financial year. Directors’ Profile 8 Annual Report 2003
  11. 11. DATO’ LIM PHAIK GAN Dato' Lim Phaik Gan, a Malaysian, aged 83, was appointed as an Independent Non-Executive Director of Siah Brothers Corporation Berhad ("SBC") on 5 February 1991. She is the Senior Independent Non-Executive Director, the Chairperson of the Nomination Committee and a member of the Remuneration Committee of SBC. She is an advocate and solicitor and was called to the Bar of England and the Bar of Malaysia. She obtained a Master of Arts degree in Law from the University of Cambridge, United Kingdom and was in active practice at the Bar of Malaysia from 1954 to 1971 and from 1980 until today. Since 1955, she has had a distinguished career in both the private and public sectors. In 1970, she was a member of the National Economic Consultative Council established when Parliament was suspended as a result of riots in 1969. From 1971 to 1980, she served as the Deputy Permanent Representative of Malaysia to the United Nations and as the Malaysian Ambassador to Yugoslavia, Austria, Belgium and the European Economic Community. She was Malaysia's Permanent Representative to the United Nations Industrial and Development Organisation and International Atomic Energy Agency in Vienna, and served as chairman in various committees. After her retirement from the Malaysian Foreign Service in 1980, she was appointed by the Government as Director of the Kuala Lumpur Regional Centre for Arbitration, an international organisation involved in the conduct and administration of international commercial arbitration for the settlement of disputes arising out of international commercial contracts and joint ventures, in which capacity she served from 1982 to 2000. She is currently a member of the Board of Trustees of the Institute of Strategic and International Studies. She does not hold any securities, direct or indirect, in SBC or any of its subsidiaries. She has no family relationship with any Director and/or major shareholder of SBC. She does not have any conflict of interest with SBC. She has not been convicted of any offence within the past 10 years. She attended two of the four Board Meetings held during the last financial year. Directors’ Profile Siah Brothers Corporation Berhad (199310-P) 9
  12. 12. DATO’ DR. NORRAESAH BT. HAJI MOHAMAD Dato’ Dr. Norraesah bt. Haji Mohamad, a Malaysian, aged 55, was appointed as an Independent Non-Executive Director of Siah Brothers Corporation Berhad ("SBC") on 8 July 1991. She is the Chairperson of the Audit Committee and a member of the Nomination Committee and the Remuneration Committee of SBC. She holds a Doctorate Degree in Economics Science (International Economics and Finance) which she obtained in 1986 from University of Paris 1, Pantheon Sorbonne, France. She has over 30 years of working experience in banking, consultancy and international trade and commerce. She worked with the International Trade Division of the Ministry of Trade and Industry (now known as the Ministry of International Trade and Industry) from 1972 to 1985 and was later transferred to the Finance Division of the Ministry of Finance holding the post of Principal Assistant Secretary dealing with privatisation and debt management. In 1988, she joined ESSO Production Malaysia, Inc. as Communications Manager and subsequently, in 1990, took the position of Managing Director with a consultant firm providing financial advisory services. From 1991 to 1998 she was appointed as the Chief Representative of Credit Lyonnais Bank in Malaysia. She sits on the board of KESM Industries Berhad, Malaysian Oxygen Berhad and several private limited companies. She was awarded the distinction of Darjah Setia Pangkuan Negeri on 13 July 2002 by Tuan Yang Terutama Yang di-Pertua Negeri Pulau Pinang on His Excellency’s 64th Birthday. Her holdings in the securities of SBC are as follows: Direct Interest Indirect Interest Transferable Subscription Rights 4,000 - She does not hold any securities, direct or indirect, in any of SBC’s subsidiaries. She has no family relationship with any Director and/or major shareholder of SBC. She does not have any conflict of interest with SBC. She has not been convicted of any offence within the past 10 years. She attended two of the four Board Meetings held during the last financial year. Directors’ Profile 10 Annual Report 2003
  13. 13. DATUK SIM PENG CHOON Datuk Sim Peng Choon, a Malaysian, aged 71, was appointed as a Non-Executive Director of Siah Brothers Corporation Berhad ("SBC") on 14 May 1993, representing the interest of Permodalan Nasional Berhad. He is a member of the Audit Committee and the Remuneration Committee of SBC. He graduated with a Senior Cambridge Certificate from the Anglo Chinese School in Ipoh, Perak Darul Ridzuan in 1951. He started his career in 1951 with Barlow & Co. Ltd., Kuala Lumpur, an agent for consumer goods as their representative. In 1953 to 1956, he joined Allen & Hansbury Ltd., a manufacturer of vitamin products, antibiotics and surgical instruments as a Medical Representative for Singapore. From 1957 to 1963, he was a Director and Manager of H Rogers & Co. Ltd., Kuala Lumpur. In 1964, he established Polychem (M) Sdn. Bhd. He is also currently the Chairman of N.P. King (HK) Ltd., Hong Kong and N.P. King Pte. Ltd., Singapore, both act as agents for manufacturers of hardware and industrial products. He is also active in several social organisations, acting as the Vice-Chairman of Kwan Inn Teng Foundation of Malaysia since 1980 and a Director and the Deputy Treasurer of Tung Shin Hospital, Kuala Lumpur since 1981 and 1986 respectively. He is a life member of Chee Kim Thong Pugilistic & Health Society in 1964. Presently, he sits on the Board of Cabot Malaysia Sdn. Bhd. and SKF Bearing Industries Malaysia Sdn. Bhd. He was awarded the distinction of Panglima Jasa Negara on 2 June 2001 by the Yang Di-Pertuan Agung on His Majesty’s 75th Birthday. His holdings in the securities of SBC are as follows: Direct Interest Indirect Interest Ordinary shares 10,869 - He does not hold any securities, direct or indirect, in any of SBC’s subsidiaries. He has no family relationship with any Director and/or major shareholder of SBC. He does not have any conflict of interest with SBC. He has not been convicted of any offence within the past 10 years. He attended all the four Board Meetings held during the last financial year. Directors’ Profile Siah Brothers Corporation Berhad (199310-P) 11
  14. 14. ABDUL RAHMAN BIN A. SHUKOR Abdul Rahman bin A. Shukor, a Malaysian, aged 41, was appointed to the Board of Directors of Siah Brothers Corporation Berhad (“SBC”) as a Non-Executive Director alternate to Datuk Sim Peng Choon on 5 February 2001. He graduated in 1985 with a degree in Bachelor of Science in Civil & Environmental Engineering from the University of Wisconsin at Madison, USA. He started his career in 1985 with Machinta Sdn. Bhd. as a Site Engineer, and subsequently joined the Department of Environment (“DOE”) as an Environmental Controller in 1986. Before he left the DOE, he was involved in the Planning Department, specifically on the aspect of Environmental Impact Assessment. In 1992, he joined PNB Equity Resource Corporation Sdn. Bhd., a wholly owned subsidiary company of PNB, as an Assistant Manager in its Venture Capital Business. In 1997, he went to the United States to pursue the Executive Master of Business Administration program from the University of New Haven at Connecticut. At the same time, he has also sat and passed the First and Second of the three levels Examination of the Chartered Financial Analysis ("CFA") Program organised by the Association of Investment Management and Research (“AIMR”), USA. The CFA Program is a distinguished professional chartership for the financial & investment communities in the USA, and have following through the establishment of AIMR charters all around the world. Upon the completion of his studies in 1999, he was assigned as a Manager in the Corporate Services Department of Permodalan Nasional Berhad (“PNB”). Presently, he sits on the Board of GKN Driveshafts (Malaysia) Sdn. Bhd., representing PNB. He does not hold any securities, direct or indirect, in SBC or any of its subsidiaries. He has no family relationship with any Director and/or major shareholder of SBC. He does not have any conflict of interest with SBC. He has not been convicted of any offence within the past 10 years. He attended two of the four Board meetings held during the last financial year. Directors’ Profile 12 Annual Report 2003
  15. 15. Corporate Structure as at 8 August 2003 SIAH BROTHERS CORPORATION BERHAD INVESTMENT HOLDING l Siah Brothers Land Sdn Bhd 100% l Siah Brothers Properties Sdn Bhd 100% l Siah Brothers Industries Sdn Bhd 100% PROPERTY DEVELOPMENT Seri Ampangan Realty Sdn Bhd 100% l Sinaran Naga Sdn Bhd 100% l Mixwell (Malaysia) Sdn Bhd 100% l South-East Best Sdn Bhd 100% l Gracemart Resources Sdn Bhd 100% l Sutrati Development Sdn Bhd 100% l Siah Brothers Development Sdn Bhd 100% l Tiara Development Sdn Bhd 100% l SBC Homes Sdn Bhd 100% l Winsome Ventures Sdn Bhd 100% l SBC Leisure Sdn Bhd 100% l SBC Towers Sdn Bhd 100% l Siah Brothers Project Management Sdn Bhd 100% l Ligamas Sdn Bhd 50% l Sri Berjaya Development Sdn Bhd 33.3% l CONSTRUCTION l Syarikat Siah Brothers Trading Sdn Bhd 100% l Syarikat Siah Brothers Construction Sdn Bhd 100% l Siah Brothers Enterprise Sdn Bhd 100% l Lifeplus - Siah Brothers Trading JV Sdn Bhd 100% PROPERTY INVESTMENT Aureate Construction Sdn Bhd 100% l Corporate Structure Sri Rawang Properties Sdn Bhd 22.2% l MANUFACTURING & TRADING l Paling Industries Sdn Bhd 40% l Liga Canggih Sdn Bhd 40% l Masahmura Sdn Bhd 51% l Masahmura Sales & Service Sdn Bhd 51% l Varich Industries Sdn Bhd 50% PLANTATION & NURSERY Sam & Lau Plantation Sdn Bhd 50% l Siah Brothers Corporation Berhad (199310-P) 13
  16. 16. Group Financial Highlights for the financial year ended 31 March 2003 2003 2002 2001 2000 1999 (Restated) RM’000 RM’000 RM’000 RM’000 RM’000 RESULTS Turnover 69,829 81,645 92,411 114,707 149,669 Profit before taxation 5,149 1,618 1,421 2,555 2,088 Profit after taxation but before minority interests 2,011 1,174 1,071 3,729 3,923 Profit attributable to shareholders 2,011 1,174 1,071 3,729 1,679 ASSETS EMPLOYED Property, plant & equipment 35,813 7,047 7,586 13,090 15,789 Investments and other assets 152,856 141,705 140,323 141,031 165,810 Net current assets 71,634 56,867 58,346 56,393 34,687 Goodwill and deferred expenditure 27,272 10,246 10,246 8,253 8,185 287,575 215,865 216,501 218,767 224,471 FINANCED BY Share capital 82,435 57,302 57,302 57,302 50,469 Share application account - 115,600 - - - Reserves 134,682 42,524 43,087 42,832 40,095 Minority interests - - - - 14,897 Irredeemable Convertible Unsecured Loan Stocks - - 115,600 115,600 115,600 ABBA Bonds 37,827 - - - - Deferred Liabilities 32,631 439 512 3,033 3,410 287,575 215,865 216,501 218,767 224,471 SELECTED RATIOS Net earnings per share (sen) 2.4 1.8 1.6 6.9 3.3 Net tangible assets per share (sen) 242 393 165 169 163 Gross dividend (%) 1.0 - 1.5 1.5 1.0 Profit Before Taxation Assets Employed Turnover Shareholders’ Fund (RM’000) (RM’000) (RM’000) (RM’000) 6 300 200 250 Group Financial Highlights 287,575 5 250 200 217,117 5,149 215,426 150 149,669 224,471 4 200 218,767 216,501 215,865 150 3 150 100 114,707 100 92,411 2,555 2 100 81,645 100,389 100,134 90,564 69,829 2,088 50 50 1,618 1 50 1,421 0 0 0 0 ’03 ’02 ’01 ’00 ’99 ’03 ’02 ’01 ’00 ’99 ’03 ’02 ’01 ’00 ’99 ’03 ’02 ’01 ’00 ’99 14 Annual Report 2003
  17. 17. Statement Of Directors’ Responsibilities In Respect Of The Preparation Of The Financial Statements The Directors are responsible for ensuring that the financial statements of the Group are drawn up in accordance with applicable approved accounting standards in Malaysia and the provisions of the Companies Act, 1965 so as to give a true and fair view of the state of affairs of the Group and the Company as of 31 March 2003 and of the results and cash flows of the Group and Company for the financial year ended on that date. In preparing the financial statements, the Directors have: (a) adopted suitable accounting policies and applied them consistently; (b) made judgements and estimates that are prudent and reasonable; (c) ensured the adoption of applicable approved accounting standards; and (d) used the going concern basis for the preparation of the financial statements. The Directors are responsible for ensuring proper accounting records are kept which disclose with reasonable accuracy at any time the financial position of the Group and the Company and are kept in accordance with the Companies Act, 1965. The Directors are also responsible for taking such steps as are reasonably open to them to safeguard the Group’s assets and to prevent and detect fraud and other irregularities. Statement Of Directors’ Responsibilities Siah Brothers Corporation Berhad (199310-P) 15
  18. 18. Executive Chairman’s Statement On behalf of the Board of Directors, I am pleased to present the Annual Report and Financial Statements of Siah Brothers Corporation Berhad for the financial year ended 31 March 2003. ECONOMIC AND BUSINESS OUTLOOK FINANCIAL PERFORMANCE The local economy posted a GDP growth of 4.2% for Inspite of the interruption of the industry wide the calendar year 2002 and is expected to post at slowdown in labor activity as cited above, the year least a similar figure in the next 12 months. has been a satisfactory one for the group. Group’s pre-tax profit increased by 218% to RM5.15 million During the first half of last year, the general business bringing the shareholders’ funds total to RM217.12 and consumer sentiment had been distinctly bright million as at 31 March 2003. This somewhat bears prior to the year end interruptions of geopolitical testimony to our efforts to raise the group profitability instability, the 2003 global health epidemic as well as both in terms of top line growth as well as quality of the single domestic issue pertaining to the that growth. displacement of the foreign labor. The latter issue which started to affect the entire industry in the latter quarter of 2002, persisted well into the first quarter of 2003 by which time most of the building activities had once again proven its resilience by readjusting and regaining its ordinary pace. After the slew of negative events, the prospects of the building and housing industry are once again looking up. Most significant were the off budget fiscal measures introduced by the government to promote the housing industry in the form of tax breaks and low mortgage rates. With another round of interest rate cuts instituted again, the general consensus is that there has not been a time in recent history that it has been so affordable to own a new home. This clearly bodes well for our group as most of our activities are either directly or indirectly tied to the outlook of the housing and development industries. Executive Chairman’s Statement The Peak Condominium Signal Hill, Kota Kinabalu 4-Storey Shop Office Suites cum Apartments Taman Mastiara, Kuala Lumpur 16 Annual Report 2003
  19. 19. OPERATIONS This year witnessed a concerted thrust towards making the overall operations more efficient; operational processes which support that delivery were significantly ‘retooled’, where a key initiative was the upgrade the framework for operational goals to make it suitable and more focussed. This facilitated better alignment of company goals vis-a-vis peoples’ goals. During the year under review, the following project precincts were delivered/handed over: 1. West Coast: Section 4, Bandar Utama Batang Kali, Selangor and Precinct 4, Mastiara, Kuala Lumpur 2. East Coast: Precinct 3, Perkampungan Seri Mahkota Aman, Kuantan, Pahang Works started on following projects over the similar period: 1. West Coast: Section 1, Taman Suria Pendamar, Klang, Selangor 2. East Coast: Precinct 5, Perkampungan Mahkota Aman, Kuantan, Pahang 3. East Malaysia: Signal Hill Park, Kota Kinabalu, Sabah During the year under review, the following project precincts were delivered/implemented under the turnkey division: 1. Upgrading of Jalan Batu Caves-Simpang Tiga, Batu Caves, Selangor 2. Turnkey construction of high grade homes at Taman Damansara Emas, Kota Damansara, Selangor Our manufacturing associate in Paling Industries Sdn Bhd (“Paling”) in collaboration with Brussels based Etex Group (a world leader in plastic piping systems) entered into its second fiscal year of operations as partnership. For both these fiscal years since 31 March 2001, Paling’s turnover and pre-tax profits posted RM30 million and RM3 million respectively. Through the year, Paling has continue to invest in human resource training as well as tools refinement enabling the raising of productivity levels and production yields. We are already seeing the benefits of technology transfer as well as tools and raw materials being sourced at very competitive rates by leveraging on the bargaining strength of the Etex Group. Moving forward, we expect improvements in the production capability of Paling to continue and we should soon see an increase in export revenue by way of additional product lines and sales to the Etex network internationally. Executive Chairman’s Statement Section 4 Bandar Utama Batang Kali, Selangor Taman Suria Pendamar, Klang Siah Brothers Corporation Berhad (199310-P) 17
  20. 20. CORPORATE DEVELOPMENT During the financial year, the Company issued RM61,961,250 nominal value Al-Bai Bithaman Ajil Bonds (“ABBA Bonds”) comprising RM49,569,000 nominal value Primary Bonds and ten (10) equal tranches Secondary Bonds with RM12,392,250 nominal value. The Primary Bonds are redeemable at maturity. Each Primary Bond is supported by ten (10) Secondary Bonds which are redeemable in semi-annual installments commencing six (6) months from the date of first issue of the Secondary Bonds. The ABBA Bonds were placed out to a licensed financial institution via a private placement. The tenure of the ABBA Single Storey Terrace Houses Bonds is five (5) years from the date of issue. Perkampungan Seri Mahkota Aman, Kuantan The profit margin on the ABBA Bonds is at a fixed percentage of 5% per annum, payable in arrears on a semi-annual basis represented by the Secondary Bonds. The ABBA Bonds are issued based on a 10% per annum yield to maturity. BOARDROOM CHANGE At the Boardroom level, you see the departure of Mr Vincent Koh Kok Kee whom I take this opportunity to express our appreciation to him for his invaluable contribution to the Group during his term in office. FUTURE OUTLOOK Shoplots As we continue to garner company wide Perkampungan Seri Mahkota Aman, Kuantan commitment to delivering on the high Executive Chairman’s Statement expectations of the group, we hold the view that, whilst still on the recovery path, the local business sentiment is fast improving. Barring ‘external shocks’, we feel that the environment should stabilize to a point where there should be vast opportunities for us as a turnkey solutions provider to achieving an all round improvement in performance. Road Upgrading Jalan Batu Caves-Simpang Tiga, Batu Caves, Selangor 18 Annual Report 2003
  21. 21. DIVIDEND The Board recommends a first and final dividend of 1% per ordinary share less 28% tax for the financial year ended 31 March 2003. Subject to the shareholders’ approval at the forthcoming Annual General Meeting of the Company, the payment of the dividend will be made to the shareholders on a date to be announced later. APPRECIATION Our employees are instrumental to the Group and Turnkey Construction of Double Storey Terrace Houses we would like to thank them for their continued Taman Damansara Emas, Kota Damansara, Selangor hard work and commitment during the past year. The Group continues to approach 2004 with similar confidence and belief in the Group and the ability of its dedicated workforce. As always, we remain grateful to our shareholders, customers, joint venture partners, business associates, bankers and government authorities for their confidence, understanding and support for the Siah Brothers Corporation Group. I am confident that with the continuing support of all parties, the Group will be able to overcome any crisis faced. In all, the Group remains committed to meeting the challenges of the coming year and to constantly aspire to be recognized as a prominent builder of homes and buildings via superior delivery by our people and strong partnership with our clients. Thank you. Paling’s Products Executive Chairman’s Statement Sia Kwee Mow @ Sia Hok Chai JMN, FFB, FCIOB, FAIB Executive Chairman 8 August 2003 Paling’s Products Siah Brothers Corporation Berhad (199310-P) 19
  22. 22. Penyata Pengerusi Eksekutif Saya bagi pihak Lembaga Pengarah dengan sukacitanya membentangkan Laporan Tahunan dan Penyata Kewangan Siah Brothers Corporation Berhad bagi tahun kewangan berakhir 31 Mac 2003. TINJAUAN EKONOMI DAN PERNIAGAAN PRESTASI KEWANGAN Ekonomi negara telah mencatatkan Keluaran Dalam Walaupun masalah aktiviti buruh sepertimana yang Negara Kasar (KDNK) sebanyak 4.2% pada telah disebutkan di atas telah menjejaskan keadaan tahun 2002 dan dijangka akan terus mencatatkan industri ini, namun tahun ini Kumpulan telah sekurang-kurangnya angka yang sama dalam membentangkan keputusan yang amat memuaskan. 12 bulan yang akan datang. Keuntungan sebelum cukai Kumpulan telah meningkat sebanyak 218 % kepada RM5.15 juta dan Sentimen konsumer dan perniagaan telah sekaligus menaikkan dana pemegang saham menunjukkan prestasi yang amat baik sebelum kepada RM217.12 juta pada 31 Mac 2003. Prestasi pertengahan tahun kedua iaitu sebelum timbulnya ini telah membuktikan nekad kami untuk ketidakstabilan geopolitik, jangkitan wabak penyakit meningkatkan keuntungan Kumpulan dari segi yang menular seluruh dunia serta isu-isu domestik pertumbuhan perolehan dan kualiti pertumbuhannya. berkaitan dengan kekurangan buruh asing. Isu domestik tersebut telah mulai menjejaskan keadaan seluruh industri ini pada suku akhir tahun 2002 malah berlarutan sehingga suku pertama tahun 2003. Namun pada ketika ini kebanyakan aktiviti dalam sektor pembinaan telah sekali lagi membuktikan daya keteguhan dengan penyesuaian aktiviti kembali ke kedudukan yang asal. Prospek sektor pembinaan dan sektor perumahan telah bertambah baik selepas mengharungi peristiwa-peristiwa negatif tersebut. Isu paling signifikan adalah rangsangan ekonomi melalui penilaian pelepasan belanjawan fiskal yang diperkenalkan oleh pihak kerajaan dalam usaha untuk mempromosikan industri perumahan melalui galakan cukai serta sumber kewangan yang murah. Malahan, kemampuan untuk memiliki rumah baru kini telah menjadi mudah dengan penurunan kadar faedah pinjaman rumah. Keadaan baik yang tidak pernah sesekali berlaku dalam sejarah negara ini telah memberi kesan yang positif kepada Kumpulan memandangkan kebanyakan aktiviti kami adalah berkaitan rapat dengan prospek sektor Penyata Pengerusi Eksekutif pembangunan dan perumahan. Kolam Renang di The Peak Kondominium Signal Hill, Kota Kinabalu Kedai Pejabat Berserta Pangsapuri 4 Tingkat Taman Mastiara, Kuala Lumpur 20 Annual Report 2003
  23. 23. OPERASI Tahun ini memperlihatkan hasrat serta kerjasama dari semua pihak untuk menghasilkan mutu operasi yang lebih cekap secara keseluruhan; proses-proses kerja yang menyumbangkan hasil tersebut telah diperbaiki, di mana inisiatif utama adalah peningkatan rangkaian kerja organisasi demi matlamat operasi untuk menjadikannya lebih sesuai dan berfokus. Usaha ini juga telah menyelaraskan tumpuan organisasi dengan matlamat masyarakat umum. Dalam tahun bawah tinjauan, Kumpulan telah berjaya menyiapkan dan menyerahkan projek-projek berikut kepada para pembeli rumah: 1. Pantai Barat: Seksyen 4, Bandar Utama Batang Kali, Selangor dan Precinct 4, Mastiara, Kuala Lumpur 2. Pantai Timur: Precinct 3, Perkampungan Seri Mahkota Aman, Kuantan, Pahang Dalam tahun yang sama, projek-projek berikut telah dimulakan kerja: 1. Pantai Barat: Seksyen 1, Taman Suria Pendamar, Klang, Selangor 2. Pantai Timur: Precinct 5, Perkampungan Mahkota Aman, Kuantan, Pahang 3. Malaysia Timur: Signal Hill Park, Kota Kinabalu, Sabah Dalam tahun bawah tinjauan, projek-projek lingkungan berikut telah disiapkan/dilaksanakan bagi bahagian ‘turnkey’: 1. Menaik-taraf Jalan Batu Caves-Simpang Tiga, Batu Caves, Selangor 2. Pembinaan ‘turnkey’ rumah gred tinggi di Taman Damansara Emas, Kota Damansara, Selangor Usahasama antara syarikat bersekutu, Paling Industries Sdn Bhd (“Paling”) dengan rakan kongsinya, Kumpulan Etex dari Brussels (pengilang terbesar di dunia dalam sistem paip plastik) telah memasuki tahun fiskal yang kedua. Dalam kedua-dua tahun fiskal semenjak 31 Mac 2001, Paling telah meraihkan perolehan sebanyak RM30 juta dan keuntungan sebelum cukai sebanyak RM3 juta. Sepanjang tahun ini, Paling telah terus melabur dalam latihan sumber manusia serta ke atas penyempurnaan peralatan kerja untuk meningkatkan lagi tahap produktiviti dan hasil pengeluaran. Kami telah menikmati kelebihan pemindahan teknologi serta perolehan peralatan dan bahan-bahan mentah pada harga yang kompetitif melalui daya rundingan Kumpulan Etex. Menjangkau masa depan, kami menjangka pertumbuhan yang berterusan dalam pengeluaran Paling dan pendapatan eksport melalui pertambahan jenis produk dan hasil jualan kepada rangkaian sedunia Etex. Penyata Pengerusi Eksekutif Seksyen 4 Bandar Utama Batang Kali, Selangor Taman Suria Pendamar, Klang Siah Brothers Corporation Berhad (199310-P) 21
  24. 24. PERKEMBANGAN KORPORAT Dalam tahun kewangan ini, Syarikat telah menerbitkan RM61,961,250 nilai nominal Bon Al-Bai Bithaman Ajil (Bon ABBA) yang terdiri daripada RM49,569,000 nilai nominal Bon Pertama dan sepuluh (10) gugusan sama Bon Kedua pada nilai nominal RM12,392, 250. Bon Pertama boleh ditebus kembali selepas tamat tempoh matang. Setiap Bon Pertama disokong oleh Bon Kedua yang dapat diperolehi semula selepas pembiayaan ansuran tempoh setengah tahun yang bermula enam bulan dari terbitan pertama Bon Kedua. Bon ABBA ditempatkan di sebuah institusi Rumah Teres Satu Tingkat kewangan berlesen menerusi suatu Perkampungan Seri Mahkota Aman, Kuantan penempatan persendirian. Tempoh pemegangan Bon ini adalah lima (5) tahun dari tarikh ia diterbitkan. Keuntungan Bon ABBA telah ditetapkan pada kadar 5% setahun, akan dibayar secara ansuran dalam tempoh setengah tahun yang diwakili oleh Bon Kedua. Bon ABBA diterbitkan pada kadar 10% setahun hingga tempoh matang. PERUBAHAN LEMBAGA PENGARAH Pada peringkat Lembaga Pengarah, saya mengambil kesempatan ini untuk melafazkan penghargaan kami kepada Encik Vincent Koh Kok Kee atas sumbangan beliau kepada Kumpulan ini sepanjang penggal beliau sebagai pengarah Syarikat. Lot Kedai Perkampungan Seri Mahkota Aman, Kuantan TINJAUAN MASA DEPAN Dengan terus melaksanakan tanggungjawab Penyata Pengerusi Eksekutif dan kewajipan semua pihak demi mencapai matlamat Kumpulan ini, kami bersependapat bahawa sentimen perniagaan yang kini masih dalam tahap pemulihan akan bertambah baik. Walaupun terdapat gangguan luaran, kami yakin bahawa keadaan persekitaran akan menjadi lebih stabil hingga ke suatu tahap yang akan mendatangkan peluang kepada kami untuk meningkatkan lagi prestasi Syarikat secara keseluruhannya. Projek Menaik-taraf Jalan Jalan Batu Caves-Simpang Tiga, Batu Caves, Selangor 22 Annual Report 2003
  25. 25. DIVIDEN Lembaga Pengarah telah mencadangkan pembayaran dividen tahunan sebanyak 1% sesaham tolak cukai 28% bagi tahun kewangan berakhir 31 Mac 2003, tertakluk kepada persetujuan para pemegang saham pada Mesyuarat Agung Tahunan akan datang. Tarikh pembayaran dividen ini akan diumumkan kelak. PENGHARGAAN Kakitangan kami adalah instrumental kepada Pembinaan Turnkey Rumah Teres Dua Tingkat Kumpulan dan kami ingin melafazkan ucapan Taman Damansara Emas, Kota Damansara, Selangor terima kasih kepada mereka atas usaha berterusan dan amanat kukuh mereka pada tahun yang lalu. Kumpulan ini akan menghadapi tahun 2004 dengan keyakinan dan percaya akan kebolehan para pekerjanya yang berdedikasi. Seperti biasa, kami juga ingin menyatakan penghargaan kami kepada para pemegang saham, rakan-rakan perkongsian, rakan-rakan perniagaan, ahli-ahli bank dan juga pihak berkuasa kerajaan atas keyakinan, persefahaman dan sokongan mereka terhadap Kumpulan Siah Brothers Corporation. Saya yakin dengan adanya sokongan berterusan daripada semua pihak, Kumpulan ini akan berupaya mengatasi sebarang rintangan yang dihadapi. Justeru itu, Kumpulan ini bertekad untuk menghadapi sebarang cabaran pada tahun yang akan datang dan terus bernekad untuk menjadi pembina perumahan dan bangunan yang terulung Produk Keluaran Paling melalui kewibawaan para pekerja kami serta talian usahasama dan hubungan yang rapat dengan para pelanggan kami. Penyata Pengerusi Eksekutif Sekian, terima kasih. Sia Kwee Mow @ Sia Hok Chai JMN, FFB, FCIOB, FAIB Pengerusi Eksekutif 8 Ogos 2003 Produk Keluaran Paling Siah Brothers Corporation Berhad (199310-P) 23
  26. 26. Statement Of Corporate Governance as at 8 August 2003 The Board of Directors of Siah Brothers Corporation Berhad appreciates and is committed to the maintenance of high standards of corporate governance by implementing the principles and best practices set out in Part 1 and 2 of the Malaysian Code of Corporate Governance (“Code”). Set out in the ensuing paragraphs are descriptions of how the Group has applied the principles and best practices of the Code during the financial year and the extent of compliance with best practices of the Code. BOARD OF DIRECTORS Composition and Balance As at the date of this statement, the Board consists of 7 members, comprising 2 independent non-executive Directors, 3 non-executive Directors and 2 executive Directors. With this Board composition, the Company complies with paragraph 15.02 of the Listing Requirements of the Kuala Lumpur Stock Exchange where at least 2 Directors or 1/3 of the Board, whichever is higher, are independent Directors. The Board comprises Directors from different professional backgrounds and collectively bring with them depth and diversity in experience and expertise to the Group’s operations. The Executive Directors are responsible for implementing policies of the Board, overseeing the Group’s operations and developing the Group’s business strategies. The role of the Independent Non-Executive Directors is to provide independent view, advice and judgement to ensure a balanced and unbiased decision making process. The Board is of the opinion that its current membership fairly reflects the investment of minority shareholders in the Company and represents the required mix of skills and experience required to discharge the Board’s duties and responsibilities. Furthermore, no individual Director or group of Directors can dominate the Board’s decision making. The profiles of the members of the Board are set out in this Annual Report under the section named Directors’ Profile. Duties and Responsibilities The Board of Siah Brothers Corporation Berhad is primarily responsible for: • Reviewing and adopting a strategic plan for the Group; Statement Of Corporate Governance • Overseeing the conduct of the Company’s business to evaluate whether the business is being properly managed; • Identify principal risk and ensure the implementation of appropriate systems to manage these risks; • Succession planning, including appointing, training, fixing the compensation of and where appropriate, replacing senior management; • Developing and implementing an investor relations program or shareholder communications policy for the Company; • Reviewing the adequacy and the integrity of the Company’s internal control systems and management information systems, including systems for compliance with applicable laws, regulations, rules, directives and guidelines. The roles of the Managing Director and Chairman are clearly distinct to ensure that there is a balance of power and authority. The Chairman is primarily responsible for the working of the Board, its membership and participation of the members at the Board meetings. The Managing Director is responsible for the daily management of the Group’s business operations and implementation of policies and strategies adopted by the Board. On 27 August 2002, the Board appointed Dato’ Lim Phaik Gan as the Senior Independent Non-Executive Director to whom concerns may be conveyed. Board Meetings Normally, the Board meets at least 4 times in a financial year with additional meetings convened to deliberate on urgent and significant matters where decisions need to be taken between the scheduled Board meetings. During the financial year ended 31 March 2003, the Board met 4 times where it deliberated on and considered matters relating to the Group’s financial performance, significant investments, corporate development, strategic issues and business plan. Details of each Director’s attendance of Board meetings are set out as follows: 24 Annual Report 2003
  27. 27. Board Meetings (cont’d) No. of Name of Director Designation meetings attended Sia Kwee Mow @ Sia Hok Chai Executive Chairman 4/4 Sia Teong Heng Managing Director 4/4 Mun Chong Shing @ Mun Chong Tian Non-Executive Director 3/4 Dato’ Lim Phaik Gan Independent Non-Executive Director 2/4 Dato’ Dr. Norraesah Bt. Haji Mohamad Independent Non-Executive Director 2/4 Datuk Sim Peng Choon Non-Executive Director 4/4 Abdul Rahman Bin A. Shukor Non-Executive Director 2/4 (Alternate to Datuk Sim Peng Choon) Vincent Koh Kok Kee Independent Non-Executive Director 4/4 (Resigned on 31 May 2003) Tan Sri Dato’ Ir. Muhammad Yusuff Independent Non-Executive Director 1/1 Bin Haji Muhammad Yunus (Resigned on 14 August 2002) All Directors receive documents on matters requiring their consideration prior to and in advance of each meeting. These documents are comprehensive and include qualitative and quantitative information to enable the Board members to make an informed decision. Senior management is invited to attend these meetings to explain and clarify matters being tabled. All proceedings of the Board meetings are minuted by the Company Secretary. There is a formal schedule of matters reserved specifically for Board’s decisions, these include approval of key policies, significant acquisitions and disposals of assets, significant investments and approval of budgets and corporate plans. To assist in the discharge of their responsibilities and duties, all Directors have access to the advice and services of the Company Secretary. If required, the Directors may engage independent professionals at the Group’s expense, in the furtherance of their duties. Statement Of Corporate Governance Re-election and Re-appointment of Directors In accordance with the Company’s Articles of Association, one third of the Directors shall retire from office and be eligible for re-election at the annual general meeting. Furthermore, each Director shall retire from office at least once in every three years. Directors who are of or over the age of seventy years shall also retire from office and be eligible for re-appointment at the annual general meeting pursuant to Section 129(6) of the Companies Act, 1965. Directors’ Training All members of the Board have attended the Mandatory Accrediation Programme conducted by the Research Institute of Investment Analysis Malaysia. The Board will ensure that all its members attend such training programs as prescribed by the Kuala Lumpur Stock Exchange. For new Directors, a familiarisation program will be conducted for them. This includes a presentation of the Group’s operations by senior management and visits to the existing project sites. Board Committees Apart from the Audit Committee, there are two other committees established by the Board during the financial year ended 31 March 2003 to assist the Board in the execution of their responsibilities. They are the Nomination and Remuneration Committees and all Board committees are provided with written terms of reference. Siah Brothers Corporation Berhad (199310-P) 25

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