Malakoff Corporation berhad ( V) Level 10, Block 4, Plaza Sentral Jalan Stesen Sentral Kuala Lumpur, MALAYSIA

Transcription

1 Malakoff Corporation berhad ( V) Level 10, Block 4, Plaza Sentral Jalan Stesen Sentral Kuala Lumpur, MALAYSIA Tel : Fax : A Member of the MMC Group 2014 Annual Report

2 2015 is a year that we will witness not only of Malakoff s relisting and market reentrance, but the outlined dedication and commitment of our people who have made it all possible. It will take to the fore their belief, and of the extraordinary endeavour of coming together as one, and in it, powering growth against constant challenges that we have faced. In the end, their achievements speak volume above all. The Group s foresight as Captain of the industry, remaining the leading independent power and water producer today is at its most defined moment, a tribute to our people in upholding the corporate values of Malakoff, and their spirit as envisioned towards excellence. With this, the Group s enduring strength as an environmentally caring company and the directional goals of sustainability continues.

3 goal To be a premier global power and water company Core Business Power generation and water desalination CRITICAL STRENGTHS Project development & execution Plant operations license to operate Financial discipline Strong governance structure MISSION Aspiring to become the preferred employer of choice Deliver superior shareholder value Sought after as a partner Sustaining best in class operating discipline Earning respect as a good corporate citizen Corporate Values Integrity Teamwork Innovation Excellence Harmony C

4 table of Contents Business Review Group Financial & 04 Performance Highlights Corporate Profile 07 Corporate Information 08 Malakoff s Shareholders 09 Malakoff s Structure 10 Directors Profile Board of Directors 14 Board of Directors Profile 16 Management Team Organisational Structure 30 Members of Management 32 Committee 02 MALAKOFF CORPORATION BERHAD Annual Report 2014

5 Corporate Performance Chairman s Statement 36 Performance Review 48 by Chief Executive Officer Asset Performance Operation & Maintenance Electricity Distribution and Chilled Water Supply Ventures Corporate Responsibility Corporate Responsibility 76 Community Development Workplace Development Environmental Preservation Marketplace Development Highlights Corporate Events Highlights 82 Financial Statements Financial Statements 89 03

6 Group Financial & Performance Highlights Revenue % RM5,594 million Shareholders Funds +1.23% RM3,964 million Earnings Per Share % 97 sen Profit After Tax & Minority Interest % RM342 million Total Assets Employed +4.52% RM29,336 million Net Assets Per share +1.26% RM11.28 FY2013 RM 000 Restated FY2014 RM 000 Revenue 4,717,419 5,594,484 Profit before tax 84, ,484 PATMI 161, ,549 Paid-up capital 351, ,344 Shareholders funds 3,915,724 3,963,649 Total assets employed 28,068,287 29,336,072 Per share (sen) earnings Dividend (gross) per share Net assets per share (RM) MALAKOFF CORPORATION BERHAD Annual Report 2014

7 Revenue Shareholders Funds Earnings Per Share Profit After Tax & Minority Interest Total Assets Employed Net Assets Per share ,717 5,594 3,916 3, ,068 29, RM Million RM Million RM Million RM Million Sen RM 05

8

9 Corporate Profile Malakoff Corporation Berhad ( Malakoff ) is one of the leading independent power and water producers based in Asia with a worldclass reputation. Our core business includes power generation, water desalination and operation & maintenance services. In Malaysia, we own an effective generation capacity of 5,346 MW comprising of six power stations that run on gas, oil and coal. Malakoff s power generation assets are held through a number of subsidiaries and associate companies: SEV Power Plant through a percent equity interest in Segari Energy Ventures Sdn Bhd ( SEV ) GB3 Power Plant through a 75.0 percent equity interest in GB3 Sdn Bhd ( GB3 ) Prai Power Plant through its wholly-owned subsidiary Prai Power Sdn Bhd ( PPSB ) Tanjung Bin Power Plant through a 90.0 percent equity interest in Tanjung Bin Power Sdn Bhd ( TBPSB ) Port Dickson Power Plant through a 100 percent equity interest in Port Dickson Power Berhad, via its wholly owned subsidiary Hypergantic Sdn Bhd* Kapar Power Station through a 40.0 percent equity interest in Kapar Energy Ventures Sdn Bhd ( KEV ) On the international front, we own an effective capacity of MW of power and 358,206 m 3 /day of water desalination. These projects are located in Saudi Arabia, Bahrain, Algeria and Australia. Furthermore, Malakoff provides services through its wholly-owned subsidiary companies: Operation and maintenance ( O&M ) services through wholly-owned Malakoff Power Berhad ( MPower ), and Teknik Janakuasa Sdn Bhd ( TJSB ) Electricity distribution activities through Malakoff Utilities Sdn Bhd ( MUSB ) a wholly-owned subsidiary, that currently supplies centralised chilled water and distributes electricity to the landmark Kuala Lumpur Sentral development ( KL Sentral ) Project management services for in-house and external projects through Malakoff Engineering ( MESB ), a wholly owned subsidiary of Malakoff. At Malakoff, we aim to work together with all stakeholders for productive partnerships. We believe that long-term partnerships re-enforce our success. As an asset-centered organisation, we maximise the value of assets we manage for our shareholders and partners. We do this by fully understanding the elements of cost, risk and performance unique to the environment in which we operate. 07

10 Corporate Information DIRECTORS Y.A.M. Tan Sri Dato Seri Syed Anwar Jamalullail Independent Non-Executive Chairman Dato Sri Che Khalib bin Mohamad Noh Non-Independent Non-Executive Director Datuk Muhamad Noor bin Hamid Non-Independent Non-Executive Director Cindy Tan Ler Chin Non-Independent Non-Executive Director Wan Kamaruzaman bin Wan Ahmad Non-Independent Non-Executive Director Datuk Ooi Teik Huat Non-Independent Non-Executive Director Tan Sri Dato Seri Alauddin bin Dato Mohd Sheriff Independent Non-Executive Director Datuk Idris bin Abdullah Independent Non-Executive Director Datuk Dr. Syed Muhamad bin Syed Abdul Kadir Independent Non-Executive Director Kanad Singh Virk Non-Independent Non-Executive Director Zalman bin Ismail Alternate to Wan Kamaruzaman bin Wan Ahmad Craig Robert Martin Alternate to Kanad Singh Virk COMPANY SECRETARIES Yeoh Soo Mei (MAICSA ) Bakar BIN Ahmad (MAICSA ) AUDIT COMMITEE MEMBERS Datuk Dr. Syed Muhamad bin Syed Abdul Kadir Chairman Datuk Idris bin Abdullah Tan Sri Dato Seri Alauddin bin Dato Mohd Sheriff Datuk Ooi Teik Huat REMUNERATION COMMITTEE MEMBERS Y.A.M. Tan Sri Dato Seri Syed Anwar Jamalullail Chairman Wan Kamaruzaman bin Wan Ahmad Datuk Dr. Syed Muhamad bin Syed Abdul Kadir RISK COMMITTEE MEMBERS Datuk Idris bin Abdullah Chairman Datuk Muhamad Noor bin Hamid Datuk Dr. Syed Muhamad bin Syed Abdul Kadir Cindy Tan Ler Chin 08 MALAKOFF CORPORATION BERHAD Annual Report 2014 Nomination Committee Members Tan Sri Dato Seri Alauddin bin Dato Mohd Sheriff Chairman Datuk Idris bin Abdullah Datuk Muhamad Noor bin Hamid REGISTERED OFFICE Ground Floor, Wisma Budiman Persiaran Raja Chulan, Kuala Lumpur Tel : Fax : Level 12, Block 4, Plaza Sentral Jalan Stesen Sentral 5, Kuala Lumpur Tel : Fax : AUDITORS KPMG PRINCIPAL BANKER MALAYAN BANKING BERHAD Company Address Level 10, Block 4, Plaza Sentral Jalan Stesen Sentral 5, Kuala Lumpur Tel : Fax : Website :

11 Kumpulan Wang Persaraan (Diperbadankan) ( KWAP ) Standard Chartered IL & FS Asia Infrastructure Growth Fund Company Pte Limited ( SCI Asia ) SEASAF Power Sdn Bhd ( SEASAF ) Employees Provident Fund ( EPF ) KWAP seasaf 2.5% SCI Asia 10% 6.5% EPF 30% AOA 28.56% MMC 22.44% Anglo-Oriental (Annuities) Sdn Bhd ( Aoa )* * AOA is a wholly-owned subsidiary of MMC MMC Corporation Berhad ( MMC ) Malakoff s Shareholders as at 28 February

12 Malakoff s Structure as at 28 February 2015 Power Generation OPERATION AND MAINTENANCE SERVICES ELECTRICITY DISTRIBUTION 93.75% Segari Energy Ventures Sdn Bhd 75% GB3 Sdn Bhd 100% Prai Power Sdn Bhd 90% Tanjung Bin Power Sdn Bhd 40% Kapar Energy Ventures Sdn Bhd 100% Hypergantic Sdn Bhd 100% Port Dickson Power Berhad 100% Tanjung Bin Energy Sdn Bhd 100% Tanjung Bin Energy Issuer Berhad 100% Malakoff Power Berhad 100% Tanjung Bin O&M Berhad 100% PDP O&M Sdn Bhd 100% Teknik Janakuasa Sdn Bhd 100% Natural Analysis Sdn Bhd I 100% TJSB Services Sdn Bhd 100% TJSB International Limited 100% TJSB International (Shoaiba) Limited 20% Saudi-Malaysia Operation & Maintenance Services Company Limited 20% Al-Imtiaz Operation & Maintenance Company Limited 100% TJSB Middle East Limited 31.5% Muscat City Desalination Operation and Maintenance Company LLC 100% TJSB Global Sdn Bhd 49% Hyflux-TJSB Algeria SPA 95% PT. Teknik Janakuasa 100% Malakoff Utilities Sdn Bhd I II 10 Dormant Malakoff s effective equity interest of 20 percent and 12 percent in SAMAWEC and SWEC respectively is held via MGL which holds 40 percent equity interest in MSCSB which in turn holds 50 percent equity interest in SAMAWEC. SAMAWEC holds 60 percent equity interest in SWEC. lll Malakoff s effective equity interest of 11.9 percent in SEPCO is held via MGL which holds 40 percent equity interest in MSCSB MALAKOFF CORPORATION BERHAD Annual Report 2014 which in turn holds 50 percent equity interest in SAMAWEC. SAMAWEC holds 60 percent in SEHCO which in turn holds 97.5 percent equity interest in SEPCO. SAMAWEC also holds a direct equity interest of 1 percent in SEPCO. IV Malakoff s effective equity interest of percent in SPHL is held via Malakoff Technical (Dhofar) Limited which holds a direct percent equity interest in OTPL which in turn holds 100 percent equity interest in SPHL. V Malakoff s effective equity interest of 35.7 percent in AAS is held via MADSB which holds 70 percent equity interest in TDIC which in turn holds 51 percent equity interest in AAS. VI VII Malakoff s effective interest of 40 percent in HPC is held via MHHCL which holds percent equity interest in MSHHCL which in turn holds 70 percent equity interest in HPC. MWM holds 50 percent participating interest in the unincorporated joint venture of the Macarthur Wind Farm.

13 PROJECT MANAGEMENT OFFSHORE OTHERS 100% Malakoff Engineering Sdn Bhd 100% MESB Project Management Sdn Bhd I 100% Malakoff Oman Desalination Company Limited 45% Muscat City Desalination Company S.A.O.C 100% Malakoff Hidd Holding Company Limited VI 57.14% Malakoff Summit Hidd Holding Company Limited VI 40% Hidd Power Company B.S.C (c) ( HPC ) VI 100% Pacific Goldtree Sdn Bhd 100% Skyfirst Power Sdn Bhd 100% Wind Macarthur Holdings (T) Pty. Limited 100% Wind Macarthur (T) Pty. Limited 100% Wind Macarthur Finco Pty. Limited 100% Malakoff Australia Pty. Ltd. 100% Malakoff Holdings Pty. Ltd. 100% Malakoff Wind Macarthur Holdings Pty. Limited 100% Malakoff Wind Macarthur Pty. Limited( MWM ) VII 100% Spring Assets Limited I 100% Malakoff Capital (L) Ltd I 100% Malakoff International Limited ( MIL ) 100% Malakoff Gulf Limited ( MGL ) 40% Malaysian Shoaiba Consortium Sdn Bhd ( MSCSB ) 20% Saudi-Malaysia Water & Electricity Company Limited ( SAMAWEC ) II 12% Shuaibah Water & Electricity Company Limited ( SWEC ) II 12% Shuaibah Expansion Holding Company Limited ( SEHCO ) III 11.7% Shuaibah Expansion Project Company Limited ( SEPCO ) III 100% Malakoff Technical (Dhofar) Limited 43.48% Oman Technical Partners Limited ( OTPL ) IV 43.48% Salalah Power Holdings Limited ( SPHL ) IV 100% Malakoff AlDjazair Desal Sdn Bhd ( MADSB ) 70% Tlemcen Desalination Investment Company SAS ( TDIC ) 35.7% Almiyah Attilemcania SPA ( AAS ) V 100% Tuah Utama Sdn Bhd 20% Lekir Bulk Terminal Sdn Bhd 54% Desa Kilat Sdn Bhd 100% Malakoff R&D Sdn Bhd 0.2% 11

14

15 Delivering Performance With significant advances made in Malakoff s consolidated effort to put the Group s foundational strength well on track, we are making our mark and fully affirmed in the continuity of delivering performance.

16 Board of Directors from left Y.A.M. Tan Sri Dato Seri Syed Anwar Jamalullail Independent Non-Executive Chairman Dato Sri Che Khalib bin Mohamad Noh Non-Independent Non-Executive Director Datuk Muhamad Noor bin Hamid Non-Independent Non-Executive Director Mr Kanad Singh Virk Non-Independent Non-Executive Director Madam Cindy Tan Ler Chin Non-Independent Non-Executive Director Datuk Ooi TeIk Huat Non-Independent Non-Executive Director

17 Datuk Dr. Syed Muhamad bin Syed Abdul Kadir Independent Non-Executive Director Datuk Idris bin Abdullah Independent Non-Executive Director Encik Wan Kamaruzaman bin Wan Ahmad Non-Independent Non-Executive Director Tan Sri Dato Seri Alauddin bin Dato Mohd Sheriff Independent Non-Executive Director Mr Craig Robert Martin Alternate to Kanad Singh Virk Encik Zalman bin Ismail Alternate to Wan Kamaruzaman bin Wan Ahmad

18 Board of Directors Profile Y.A.M. Tan Sri Dato Seri Syed Anwar Jamalullail Independent Non-Executive Chairman 16 MALAKOFF CORPORATION BERHAD Annual Report 2014

19 Y.A.M. Tan Sri Dato Seri Syed Anwar Jamalullail, aged 63, was appointed to our Board as our Independent Non-Executive Chairman on 1 December He is also the Chairman of our Remuneration Committee. Y.A.M. Tan Sri Dato Seri Syed Anwar Jamalullail holds a Bachelor of Arts degree in Accounting from Macquarie University in Sydney, Australia which he graduated in He is a qualified Chartered Accountant, having qualified in 1983 from the Malaysian Institute of Accountants ( MIA ) and in 1984 from Certified Practising Accountants Australia. He commenced his career with Malaysia Airlines Systems Berhad in 1975 as a Financial Accountant, before moving on to Price Waterhouse Australia in He then joined D & C Nomura Merchant Bank Berhad for a year from 1984 to 1985 as Investment Manager. In 1986, he joined Amanah Merchant Bank Berhad where he held the position of Corporate Finance Manager. He was then appointed as a Managing Director of Mega SPJ Sdn Bhd and Coral Land Sdn Bhd, property development companies from 1989 to He then served Amanah Capital Partners Bhd as its Group Managing Director from October 1998 to Since then, Y.A.M. Tan Sri Dato Seri Syed Anwar Jamalullail was appointed as Chairman of several companies including Malaysian Resources Corporation Berhad, Media Prima Berhad, Realmild (M) Sdn Bhd, Radicare (M) Sdn Bhd, DRB- Hicom Berhad, EON Capital Berhad and EON Bank Berhad from 2002 until He was also a former Director of Maxis Communications Berhad and Bangkok Bank Berhad. Y.A.M. Tan Sri Dato Seri Syed Anwar Jamalullail was also the former Chairman of the Lembaga Tabung Haji Investment Panel and Matrix Capacity Petroleum Group Berhad. He is currently the Chairman of Nestle (M) Berhad, Pulau Indah Ventures Sdn Bhd, (a joint venture company between Khazanah Nasional Berhad ( Khazanah ) and Temasek Holdings (Private) Limited) and Cahya Mata Sarawak Berhad. He is also the Chancellor of SEGi University and the Chairman of the Board of Trustee of Lembaga Zakat Selangor. 17

20 Board of Directors Profile (continue) Dato Sri Che Khalib bin Mohamad Noh Non-Independent Non-Executive Director 18 MALAKOFF CORPORATION BERHAD Annual Report 2014

21 Dato Sri Che Khalib Mohamad Noh, aged 49, was appointed to our Board as our Managing Director on 1 July He resigned as our Managing Director on 8 December 2014 and has been redesignated as our Non-Independent Non-Executive Director on 9 December Dato Sri Che Khalib Mohamad Noh is a member of the Malaysian Institute of Accountants (CA, M) and also a Fellow of the Association of Chartered Certified Accountants (FCCA, UK) United Kingdom. He began his career with Messrs Ernst & Young in 1989 and later joined Bumiputra Merchant Bankers Berhad. Between 1992 and 1999, he served in several companies within the Renong group including Projek Lebuhraya Utara Selatan Berhad (PLUS), HBN Management Services Sdn Bhd, Renong Overseas Corporation Sdn Bhd and Marak Unggul Sdn Bhd, which is the consortium responsible for the management of the Keretapi Tanah Melayu Berhad. In June 1999, he joined Ranhill Utilities Berhad as Chief Executive Officer. He then assumed the position of Managing Director and Chief Executive Officer of KUB Malaysia Berhad in Dato Sri Che Khalib Mohamad Noh was then appointed as the President/Chief Executive Officer of Tenaga Nasional Berhad ( TNB ) on 1 July 2004 where he served TNB for eight years until the completion of his contract on 30 June During his tenure at TNB, Dato Sri Che Khalib Mohamad Noh drove many improvement initiatives that resulted in TNB becoming one of the success stories in the Malaysia s GLC Transformation Programme. He shaped and set the corporate strategies for TNB when he came up with its 20-year strategic plan in September At present, Dato Sri Che Khalib Mohamad Noh is the Group Managing Director of MMC Corporation Berhad ( MMC ). Prior to his current role, he served as Chief Operating Officer of Finance, Strategy and Planning at DRB-Hicom Berhad. Dato Sri Che Khalib Mohamad Noh has also served on the Board of Directors in several of the United Engineers Malaysia Berhad group of companies, in Bank Industri & Teknologi Malaysia Berhad, and in Khazanah Nasional Berhad from 2000 to 2004, where he also served on the Executive Committee. He currently sits on the boards of MMC, Zelan Berhad, Johor Port Berhad, MMC Engineering Group Berhad, Aliran Ihsan Resources Berhad, Bank Muamalat Malaysia Berhad, Gas Malaysia Berhad, NCB Holdings Berhad and several private limited companies. Dato Sri Che Khalib Mohamad Noh has received many accolades in recognition of his strong leadership including being named Malaysia s CEO of the Year in 2008, organised by the New Straits Times and American Express. He was also named CEO of the Year at the inaugural Asia Power and Electricity Awards 2010 and was the recipient of the Lifetime Achievement Award at the Asian Utility Industry Awards

22 Board of Directors Profile (continue) Datuk Muhamad Noor bin Hamid Non-Independent Non-Executive Director Datuk Muhamad Noor Hamid, aged 63, was appointed to our Board as our Non-Independent Non-Executive Director on 13 July He is also a member of our Nomination Committee and Risk Committee. Datuk Muhamad Noor Hamid obtained a Bachelor of Science (Hons) in Mechanical Engineering from Sunderland Polytechnic, England in 1977 and a Post Graduate Diploma in Gas Engineering from the Institute of Gas Technology in Chicago, Illinois, USA in He has also attended the Management Program in 1992 at the Wharton Business School of Management, University of Pennsylvania, USA. Datuk Muhamad Noor Hamid has held numerous positions during his 20 years of service in PETRONAS and PETRONAS Gas Sdn Bhd, including heading the Peninsular Gas Utilisation II project team. He also worked in OGP Technical Services Sdn Bhd, a joint venture company between PETRONAS and Novacorp Corporation of Canada, where he was the General Manager of the Pipeline Division. His expertise has taken him to overseas assignments mainly in Sudan where he was the Project Director for the Muglad Basin Oil Development Project. In 2000, he was appointed as the Chief Operating Officer of Projass Engineering Sdn Bhd, a Class A Bumiputera construction company. He joined Gas Malaysia Berhad in 2003 as Chief Operating Officer and was subsequently appointed as Chief Executive Officer in February On 24 April 2006, he was promoted to the position of Managing Director of Gas Malaysia Berhad. On 31 December 2013, he retired from Gas Malaysia Berhad. He has more than 30 years of direct working experience in the oil and gas industry ranging from project planning and implementation, operation, consulting and contracting. 20 MALAKOFF CORPORATION BERHAD Annual Report 2014

23 Cindy Tan Ler Chin Non-Independent Non-Executive Director Tan Ler Chin, aged 54, was appointed to our Board as our Non-Independent Non-Executive Director on 9 August She is also a member of our Risk Committee. Tan Ler Chin obtained an Honours degree in Economics, majoring in statistics, from Universiti Kebangsaan Malaysia in In 1991, she obtained a Certified Diploma in Accounting and Finance, accorded by the Chartered Association of Certified Accountants. In 1995, she attended the Wharton-National University of Singapore Banking Programme. Tan Ler Chin joined Employees Provident Fund ( EPF ) in Since then she has served in the Finance Department, Treasury Department, Fund Management Function and was the Head of Fixed Income Investment of EPF until June 2009, before she was appointed to her current position as the Head of Investment Compliance and Settlement of EPF. 21

24 Board of Directors Profile (continue) Kanad Singh Virk Non-Independent Non-Executive Director Kanad Singh Virk, aged 48, was appointed to our Board as our Non-Independent Non-Executive Director on 16 December Kanad Singh Virk received a Bachelor of Arts degree with a joint major in Mathematical Economics and History from Pomona College, USA in 1988 and a Juris Doctor Degree (magna cum laude) from the University of Minnesota Law School, USA in Kanad Singh Virk is the Managing Director of Standard Chartered Private Equity Limited, based in Singapore and a Director and the Chief Operating Officer of SCI Asia. He has 20 years of experience, including private equity investing, mergers and acquisitions, project finance and financings in a broad range of industries. In his capacity as the Chief Operating Officer of SCI Asia, he leads SCI Asia s functions related to legal, compliance, finance and accounting. He has been actively involved in the execution, management and exit of several investments. Prior to joining Standard Chartered in 2008, he was with Goldman Sachs for 10 years, where he held several senior positions, including the Chief Operating Officer of Private Wealth Management Europe, the Middle East and Africa and earlier, Asia, and was a member of the Asia ex-japan Mergers and Acquisitions group in the Investment Banking Division. He previously worked as a lawyer in mergers and acquisitions and energy project finance at Cravath, Swaine & Moore in New York and later at Skadden Arps, Slate, Meagher, Flom LLP in Los Angeles, Hong Kong, London and Vienna. 22 MALAKOFF CORPORATION BERHAD Annual Report 2014

25 Datuk Ooi TeIk Huat Non-Independent Non-Executive Director Datuk Ooi Teik Huat, aged 55, was appointed to our Board as our Non-Independent Non-Executive Director on 1 January He is also a member of our Audit Committee. Datuk Ooi Teik Huat obtained a Bachelor degree in Economics from Monash University, Melbourne, Australia in 1984 and is a member of the Malaysian Institute of Accountants and CPA Australia. Datuk Ooi Teik Huat began his career with Messrs Hew & Co. (now known as Messrs Mazars), Chartered Accountants in After leaving Messrs Hew & Co in June 1989, he joined Malaysian International Merchant Bankers Berhad (now known as Hong Leong Investment Bank Berhad) until August He subsequently joined Pengkalan Securities Sdn Bhd (now known as PM Securities Sdn Bhd) in August 1993 as Head of Corporate Finance, before leaving in September 1996 to set up Meridian Solutions Sdn Bhd where he is presently a director. Datuk Ooi Teik Huat also sits on the board of directors of MMC Corporation Berhad, Tradewinds (M) Berhad, Tradewinds Plantation Berhad, DRB-HICOM Berhad, Zelan Berhad, Johor Port Berhad, Gas Malaysia Berhad, MARDEC Berhad, Padiberas Nasional Berhad and several private limited companies. 23

26 Board of Directors Profile (continue) Tan Sri Dato Seri Alauddin bin Dato Mohd Sheriff Independent Non-Executive Director Tan Sri Dato Seri Alauddin Dato Md Sheriff, aged 68, was appointed to our Board as our Independent Non-Executive Director on 11 December He is also the Chairman of our Nomination Committee and a member of our Audit Committee. Tan Sri Dato Seri Alauddin Dato Md Sheriff was admitted as an Utter Barrister of the Honourable Society of Inner Temple, London, having been called to the Bar of England & Wales in Tan Sri Dato Seri Alauddin Dato Md Sheriff held various posts in the legal and judicial service since He started his career with the Judiciary as a Magistrate in Bukit Mertajam in 1971 and in Kangar in Thereafter, he was appointed as President of the Sessions Court in Sungai Petani, Kuantan and Taiping. In 1977, he was appointed as Senior Federal Counsel with the Income Tax Department and the Attorney General s Chambers. In June 1979, he was seconded to PETRONAS Carigali Sdn Bhd as its Secretary cum Legal Advisor. Thereafter, he was appointed as the Legal Advisor to the State of Johor in October In April 1982, he took the office of the Legal Advisor of Negeri Sembilan. He was again appointed as the Legal Advisor to the State of Johor in June He was appointed as the Chairman of the Advisory Board in the Prime Minister s Department since June Tan Sri Dato Seri Alauddin Dato Md Sheriff was appointed as Judicial Commissioner of the High Court of Malaya in Kuala Lumpur on 1 February 1992 and was transferred to the High Court of Malaya in Johor in the same year. He was later elevated as the Judge of the High Court wherein he had served in the High Courts of Johor, Kangar and Alor Star before being elevated to the Court of Appeal in April After serving for about three years in the Court of Appeal, he was elevated to the Federal Court of Malaysia on 12 July During his tenure as a Judge of the Federal Court, he had the occasion of carrying out the duties and functions of the President of the Court of Appeal from 15 August 2006 until 4 September On 5 September 2007, he was appointed as the Chief Judge of Malaya and on 18 October 2008, he was appointed as the President of the Court of Appeal until his retirement in August He also sits on the board of AFFIN Holdings Berhad and Vertical Inter Circle Sdn Bhd. 24 MALAKOFF CORPORATION BERHAD Annual Report 2014

27 Datuk Idris bin Abdullah Independent Non-Executive Director Datuk Idris Das Murthy, aged 58, was appointed to our Board as our Independent Non-Executive Director on 11 December He is also the Chairman of our Risk Committee and a member of our Audit Committee and Nomination Committee. Datuk Idris Das Murthy graduated from Universiti Malaya in 1981 with a LLB. (Hons) degree. His career started in 1981 where he read in chambers at Messrs. Ting Tung Ming Esq in Sibu, Sarawak. In 1982, he was admitted to The Roll of Advocates of The High Court of Malaya in Sabah and Sarawak. He also served as Resident Lawyer at Ting & Company, Sibu, Sarawak from 1981 to 1983, the In-House Legal Advisor of Sarawakian Group of Companies from 1984 to 1985 and has been with Messrs. Idris & Company Advocates, Kuching, Sarawak since 1985 and is currently a Senior Partner in Messrs. Idris & Company Advocates, Kuching, Sarawak. His experience in the corporate sector began in 1979 as a partner/shareholder in a group of Bumiputra companies in Sibu, Sarawak. From 1995 to date, he is an advisor to a number of Sarawak companies engaged in construction and building, motor trading, recreation club and educational institution. He was also a director/shareholder of a Bumiputra PKK Class A/CIDB Group 7 company engaged in a number of government building/ infrastructure projects. From September 2002 to September 2005, he was the Director and Chairman of Kuantan Flourmills Berhad. He is the former Commission Member of the Companies Commission of Malaysia ( CCM ) and is also a Commission Member of the Malaysian Communications and Multimedia Commission (SKMM). Datuk Idris Das Murthy is the Chairman of Xian Leng Holdings Berhad and also sits on the board of directors of several private limited companies. 25

28 Board of Directors Profile (continue) Datuk Dr. Syed Muhamad bin Syed Abdul Kadir Independent Non-Executive Director Datuk Dr. Syed Muhamad Syed Abdul Kadir, aged 68, was appointed to our Board as our Independent Non-Executive Director on 11 December He also is the Chairman of our Audit Committee and a member of our Remuneration Committee and Risk Committee. Datuk Dr. Syed Muhamad Syed Abdul Kadir graduated with a Bachelor of Arts (Hons.) from Universiti Malaya in He obtained a Masters of Business Administration from the University of Massachusetts, USA, in 1977 and proceeded to obtain a PhD (Business Management) from Virginia Polytechnic Institute and State University, USA in In 2005, he obtained a Bachelor of Jurisprudence (Hons.) from the University of Malaya. He obtained the Certificate in Legal Practice in 2008 from the Malaysian Professional Legal Board. He was admitted as an Advocate and Solicitor of the High Court of Malaya in July 2009, and obtained the Master of Law (Corporate Law) from Universiti Teknologi MARA in December In June 2011, he became a member of the Chartered Institute of Arbitrators, United Kingdom and in May 2012, he became the fellow of the said Institute. 26 MALAKOFF CORPORATION BERHAD Annual Report 2014 Datuk Dr. Syed Muhamad Syed Abdul Kadir started his career in 1973 as Senior Project Officer, School of Financial Management at the National Institute of Public Administration (INTAN) and held various positions before his final appointment as Deputy Director (Academic). In November 1988, he joined the Ministry of Education as Secretary of Higher Education and thereafter assumed the post of Deputy Secretary (Foreign and Domestic Borrowing, Debt Management), Finance Division of Federal Treasury. Between June 1993 to June 1997, he joined the board of directors of Asian Development Bank, Manila, the Philippines, first as alternate Executive Director and later as an Executive Director. In July 1997, he joined the Ministry of Finance as Secretary (Tax Division) and subsequently became the Deputy Secretary General (Operations) of Ministry of Finance. Prior to his retirement, he was Secretary General, Ministry of Human Resources from August 2000 to February Datuk Dr. Syed Muhamad Syed Abdul Kadir is the Chairman of CIMB Islamic Bank Berhad, CIMB Middle East B.S.C (c) and CIMB-Principal Islamic Asset Management Sdn Bhd. He is also a Director of CIMB Bank Berhad, Euro Holdings Berhad, Solution Engineering Holdings Berhad, BSL Corporation Berhad, ACR ReTakaful Berhad, Sun Life Malaysia Assurance Berhad and Sun Life Malaysia Takaful Berhad. He also holds directorships in a number of private companies.

29 Wan Kamaruzaman bin Wan Ahmad Non-Independent Non-Executive Director Wan Kamaruzaman Wan Ahmad, aged 55, was appointed to our Board as our Non-Independent Non-Executive Director on 21 May He is also a member of our Remuneration Committee. Wan Kamaruzaman Wan Ahmad obtained a Bachelor of Economics degree in Analytical Economics from the University of Malaya in Wan Kamaruzaman Wan Ahmad is currently the Chief Executive Officer of KWAP and has been serving since May Previously, he served as the General Manager of Treasury Department at the EPF from October 2007 until April He started his working career with Malayan Banking Berhad ( Maybank ) since 1981, mostly in Treasury Department with two overseas postings at Hamburg, Germany as Chief Dealer and London, United Kingdom as Treasury Manager. After leaving Maybank, he served in several companies within the Affin bank group, as the Chief Executive Officer of Affin Moneybrokers Sdn Bhd from July 1994 to August 2003 and as the Chief Executive Officer of Affin Trust Management Sdn Bhd from September 2003 to November He was also a board member of Affin Futures Sdn Bhd from September 1999 to December 2002 and a board member of Affin Fund Management Sdn Bhd from January 2004 to November He joined Kemuncak Facilities Management Sdn Bhd as the Executive Director-Finance and served the company till September He then joined Izoma Sdn Bhd as Executive Director-Finance from October 2006 till August He is a board member of Valuecap Sdn Bhd and Chairman of i-vcap Management Sdn Bhd. He is also a director of Prima Ekuiti (UK) Ltd, a subsidiary company of KWAP. 27

30 Board of Directors Profile (continue) Craig Robert Martin Alternate to Kanad Singh Virk Craig Robert Martin, aged 44, was appointed to our Board as Alternate Director to Kanad Singh Virk on 7 January Craig Robert Martin obtained his Masters degree in Electronic Engineering from the University of York, United Kingdom and a Masters in Business Administration with distinction from INSEAD in 1992 and 2000, respectively. He has lived and worked in South East Asia for 21 years and during the last 14 years, he has been responsible for originating, structuring and executing numerous private equity deals for institutional investors. He also developed, structured and raised funds from institutional and retail sources. He joined Capital Advisors Partners Asia Pte Ltd ( CapAsia ) in mid-2010 where he is a Managing Director and Head of Fund for the South East Asian Strategic Assets Fund and the CapAsia ASEAN Infrastructure Fund III ( CAIF III ). He is a member of the investment committees for the South East Asian Strategic Assets Fund and CAIF III and sits on the board of directors of the General Partner for CapAsia s Islamic Infrastructure Fund. Prior to joining CapAsia, he was with Prudential Asset Management (Singapore) Limited (now known as Eastspring Investments (Singapore) Limited), a wholly-owned subsidiary of Prudential Plc for five years, where he served as an Investment Director of Prudential Vietnam Fund Management Company from 2005 to Before joining Prudential, he was with Standard Chartered Private Equity Pte Limited, a wholly-owned subsidiary of Standard Chartered Bank Plc, from its inception where he served as an Associate Director. He is a member of the Singapore Institute of Directors and sits on several of CapAsia s boards and also holds a number of external non-executive director roles. He is a non-executive director of Myanmar Investments International Limited, a public company listed on the London Stock Exchange. 28 MALAKOFF CORPORATION BERHAD Annual Report 2014

31 Zalman bin Ismail Alternate to Wan Kamaruzaman bin Wan Ahmad Zalman Ismail, aged 43, was appointed to our Board as the alternate director to Wan Kamaruzaman Wan Ahmad on 21 May Zalman Ismail was a member of our Board on 18 March 2013 before he resigned on 21 May 2013 to assume his current position as the alternate director to Wan Kamaruzaman Wan Ahmad. Zalman Ismail obtained a Bachelor s degree (Hons) in Business Administration (Finance) from Eastern Michigan University, United States in He started his career in 1995 where he joined Rating Agency Malaysia as a credit analyst until He then worked as a stock broking analyst at Dresdner Kleinwort Benson Research (M) Sdn Bhd from 1997 to In 1999, he joined a telecommunication engineering company, Twin Worldwide Communication Sdn Bhd as General Manager of Finance & Operations until He joined the Sime Darby Group in 2005 and held various positions in the Group including as Head of Value Management and Head of Investor Relations for the Sime Darby group and Head of Business Development for its Healthcare Division prior to leading the Strategy and Business Development Department of Sime Darby Property Berhad until He has over 19 years work experience and he also spearheaded the valuation and closing team for the mega plantation merger between Sime Darby Berhad, Kumpulan Guthrie Berhad and Golden Hope Plantations Berhad. Zalman Ismail is currently the Director of Alternative Investment Department, KWAP, a position he held since His responsibilities include maximizing long-term returns through investments in private equity, property and infrastructure both local and overseas. 29

32 Organisational Structure CHIEF OPERATING OFFICER Teknik Janakuasa Sdn Bhd ( TJSB ) Operation & Maintenance Division* Asset Management Division Asset Development Legal (Operation) Maintenance, Repair & Overhaul Department ( MRO ) Operation & Maintenance ( O&M ) Malakoff Utilities Sdn Bhd ( MUSB ) Information & Communications Technology ( ICT ) *Malakoff Power Berhad ( MPower ) 30 MALAKOFF CORPORATION BERHAD Annual Report 2014

33 CHIEF EXECUTIVE OFFICER Internal Audit & Risk Management Group Finance and Accounts Division Ventures Division Corporate Affairs and External Relations Department Human Resource and Admin Department Legal Department (Projects) 31

34

35 Members of Management Committee from left Dato Sri Syed Faisal Albar Chief Executive Officer Habib Husin Chief Operating Officer Nordin Kasim Senior Vice President, Operation & Maintenance Division Ruswati Othman Chief Financial Officer/ Senior Vice President, Group Finance & Accounts Division Azhari Sulaiman Senior Vice President, Ventures Division Mohd Shokri Daud Senior Vice President, Asset Management Division

36

37 Defining Sustainability Our achievements as a recognised independent power and water producer have been due to the infinite value chain of our people, and that we at Malakoff are compelled to meet today s business demands in defining sustainability

38

39 Chairman s Statement Dear Stakeholders, In my inaugural message as Chairman of Malakoff Corporation Berhad (Malakoff), I am pleased to report that the Group s performance in a challenging year underscored its fundamental strengths and the strong prospects in moving forward. At almost every front, where the year under review ended 31 December 2014 (FY 2014) was a particularly gratifying one for Malakoff. Commendable operational performance achieved the past year reinforced Malakoff s resilience in coping with challenges. In Malaysia, many of our plants consistently performed above the Independent Power Producer ( IPP ) industry average in terms of energy availability factor and thermal efficiency. Critically, a far-reaching recovery programme for the Tanjung Bin Power Plant was completed in March 2014, with all three units of the plant operating at full capacity. Our performance on the domestic front was matched overseas, with many of our plants achieving an availability factor of more than 90.0 percent. The good news on the operational front has translated into a robust financial performance. Revenue increased to RM5.594 billion for FY 2014, compared to RM4.717 billion posted the previous year. The results achieved are a testament to our disciplined management approach and the dedication of our employees to deliver results. In positioning the Group for a new and dynamic phase of growth, we have addressed a number of operational and structural issues and identified a clear path for the future. With all the fundamentals in place and riding the momentum established, Malakoff is now in a strong position to embark on a new chapter of dynamic and sustainable growth. FINANCIAL PERFORMANCE Despite a challenging operating environment, the Group posted revenue of RM5.594 billion for FY This was RM0.877 million or 19.0 percent higher than the RM4.717 billion recorded in FY The improved numbers were achieved on the back of the full recovery of the Tanjung Bin Power Plant and additional contribution from the Port Dickson Power Plant following the acquisition of the remaining 75.0 percent equity interest in the plant not held by the Group. Our 50 percent stake in the Macarthur Wind Farm in Australia also made its maiden contribution to Group revenue during the year. 37

40 Chairman s Statement (continue) For FY 2014, Group Profit After Tax and Minority Interest ( PATMI ) was posted at RM342 million, against RM162 million achieved previously. The improved result was mainly attributed to the successful implementation of the turnaround programme at the Tanjung Bin Power plant, which saw a significant improvement in the equivalent availability factor of 81.6 percent. Overall commendable performances by all our plants also contributed towards improved profitability. Total assets have been steadily rising over the years and as at the end of FY 2014 stood at RM29.34 billion, mainly due to the construction and development of the new Tanjung Bin Energy Power Plant. The Group has strong cash-generating ability due to the lucrative and dependable cash flows from its IPPs. According to Rating Agency Malaysia ( RAM ), Malakoff has a credit rating of at least AA3/AA at various levels in our group of companies. The results achieved are a testament to our disciplined management approach and the dedication of our employees to deliver results. In positioning the Group for a new and dynamic phase of growth, we have addressed a number of operational and structural issues and identified a clear path for the future. The approvals from the relevant authorities will pave the way for Malakoff to eventually undertake an IPO of up to 1,521,740,000 ordinary shares of RM0.10 each ( Shares ) representing approximately 30.0 percent of the enlarged issued and paid-up share capital of the Company (subject to over allotment option). This will comprise an Institutional Offering of 1,279,240,000 Shares and a Retail Offering of million Shares. When completed, the Proposed IPO will enable Malakoff to list and quote its entire enlarged issued and paid-up share capital comprising 5,000,000,000 Malakoff Shares on the Main Market of Bursa Securities. DIVIDEND POLICY The Board of Malakoff is recommending a dividend policy that will allow shareholders to participate in the Company s profits, whilst retaining adequate reserves for working capital requirements. As part of this policy, the Company targets a dividend payout ratio of not less than 70.0 percent of its consolidated profit attributable to the owners of our Company beginning 1 January CORPORATE DEVELOPMENTS Malakoff was delisted in 2007, but from a new position of strength, we are now ready to open a new chapter in its ongoing transformation journey. On 27 November 2014, our parent company MMC Corporation Berhad ( MMC ) announced the proposed listing of Malakoff on the Main Market of Bursa Malaysia Securities Berhad ( Bursa Securities ) via an Initial Public Offering ( IPO ). In mid-december 2014 Malakoff submitted applications to the various relevant authorities to undertake the proposed listing. Barring any unforeseen circumstances, we have targeted the completion of the proposed IPO by the second quarter of About 90.0 percent of the proceeds from the IPO will be utilised to pare down debts, which will reduce Malakoff s gearing and improve its capital structure. This will enable the Company to benefit from greater financial flexibility to optimise its capital structure to exploit emerging growth opportunities. The remaining 10.0 percent will be set aside for business expansion, working capital and expenses incurred for the IPO exercise. AN ATTRACTIVE VALUE PROPOSITION I am of course aware that the sharp decline in oil prices since late 2014 has changed the economic environment and investor confidence. Nevertheless, we believe that it is an opportune time to reintroduce Malakoff to the Malaysian equity market. The listing exercise is in line with our long-term business strategies and objective to position the Malakoff Group as Malaysia s leading multinational water and power company. 38 MALAKOFF CORPORATION BERHAD Annual Report 2014

41 Our shareholders already include some of the biggest Malaysian institutions and experienced local and international financial investors. The general public and astute investors will undoubtedly recognise the intrinsic value Malakoff offers and are thus able to make informed independent decisions to invest in the largest IPP in Malaysia and participate in the continuing growth of the Malakoff Group. Since becoming a private company in 2007, we have set ourselves a series of goals, determining a clear way forward to take us to the next level and realise our corporate vision. Consider what we have achieved in a relatively short period of time: Largest IPP in Malaysia and Southeast Asia We have the largest effective generation capacity installed in Malaysia and Southeast Asia ( SEA ). The six IPPs owned by our subsidiaries and an associate have a total effective power generation capacity of 5,346 MW, giving us a commanding 24.9 percent market share of the total installed capacity in Peninsular Malaysia. From the time the Company was taken private, effective capacity has soared 93.9 percent from 3,128.7 MW in 2007 to 5,346.0 MW. Growing International Independent Water Production ( IWP ) and Power Generation Portfolio Our international expansion efforts have transformed Malakoff from a domestic player into a leading multinational power generator and water producer. In doing so, we have diversified our geographic presence from wholly within Malaysia to now having operations in Kingdom of Saudi Arabia, Algeria, Bahrain and Australia. Through our international plants, the effective power generation and water production capacity stands at around 690 MW and 358,850 cubic metres/day respectively. Recently, we were also the successful bidder for the Al Ghubrah IWP in Oman and in FY 2013, acquired a 50.0 percent participating interest in the MacArthur Wind Farm, which is the largest wind farm in the southern hemisphere. The Group is therefore well positioned to benefit from an expected increase in electricity and water consumption in the MENA region in tandem with Gross Domestic Product ( GDP ) growth. Strong growth is also expected in the wind power generation business in Australia, with Renewable Energy Target of 20.0 percent of Australia s electricity coming from renewable resources, by

42 Robust Financial Performance Since 2007, our key financial metrics have improved with a percent increase in revenue, while EBITDA grew by 9.1 percent. About 94.8 percent of the Group s revenue is generated by the power generation business, from which it receives capacity as well as energy payments from Tenaga Nasional Berhad ( TNB ). Malakoff has the longest remaining PPA life-span amongst Malaysian IPPs and a high level of contracted revenue stream of 92.0 percent. Sustainable Business Model Our business model is designed to ensure sustainable growth, present and well into the future. Over the years, we have taken a conscious decision to move away from an overwhelming dependence on natural gas in our power plants to achieve a more balanced fuel mix that includes coal, multifuels and oil. Whilst expanding our international foot-print, we have also diversified our earnings base by venturing into new but related areas of business such as wind energy, water production, electricity and chilled water distribution, Operation and Maintenance ( O&M ) services including Power Plant training. Well Positioned to Capitalise on the Increasing Role of Coal Over the years, Malaysia has seen a gradual shift in its energy mix for power generation to reduce overreliance on just one source. Coal is expected to increase its contribution to the nation s energy mix to 49.0 percent by the year Our Tanjung Bin Power Plant is one of the largest privately owned coal-fired power plants in SEA accounting for around 29.3 percent of Peninsular Malaysia s total installed coal-fired generation capacity. With the completion of the Tanjung Bin Energy Power Plant in 2016, our share will increase to around 38.0 percent. Strong Culture of Operational Excellence A focus on operational excellence has ensured that our plants are managed and maintained efficiently and cost-effectively to meet world-class standards. This has enabled some of our plants to achieve higher than IPP industry averages, which is matched by a commendable performance in the key areas of Health, Safety and Environment ( HSE ) and plants overall performance. Proven O&M Track Record Malakoff has a proven track record of expansion through greenfield developments and acquisitions. We have a total O&M portfolio capacity of 8,049 MW of power and 1,421,000 m 3 /day of water, which includes some of the largest IWP and IWPP in the MENA region. With an average contract expiration period of 19 years, our O&M portfolio affords the Group long-term earnings visibility. Strategic Partners Malakoff s standing in the industry has enabled it to forge mutually beneficial relationships, which include high-quality counter-parties in the business, suppliers and an international network of vendors and strategic partners. 40 MALAKOFF CORPORATION BERHAD Annual Report 2014

43 A strong and Capable Workforce A great deal was accomplished in 2014 Whether it is our ability to consistently perform above the IPP industry average in terms of energy availability factor and thermal efficiency, or our capacity and resilience to turn around challenging conditions, one critical success factor deserves a special mention our people. It is thanks to the relentless efforts and unwavering commitment of our company s management and the staff that we are here today looking back at 2014 as an eminently satisfactory financial year. Our people have been and will continue to be our strength. In addition to ensuring sufficient opportunities exist for our people to bridge any gaps they may have in technical and functional competencies, we also acknowledge the importance for our staff to forge a stronger team spirit committed to execution excellence by developing leaders at all levels. A comprehensive learning and development plan ensures the development of not just technical and functional competencies, but also leadership skills for our people to prepare them for the present and future. KEY BUSINESS STRATEGIES Building on a solid platform established, we will capitalise on opportunities coming our way to further unlock the value-creating potential of our businesses. As our overriding goal is to provide long-term growth for our stakeholders, our roadmap to the future includes the following key business strategies: Expand Power Generation Platform The Energy Commission of Malaysia (Suruhanjaya Tenaga) has set a target to increase the power generation capacity in Peninsular Malaysia by an additional 10,923 MW to 11,323 MW between 2014 and In line with this, Malakoff plans to expand the Group s effective power generation capacity from the current 6,036 MW to 10,000 MW by the year When commercial operations of the Tanjung Bin Energy Power Plant begin by 2016 it will add 1,000 MW to our effective power generation capacity. The Group has a significant land bank with long remaining land leases that can be 41

44 Chairman s Statement (continue) utilised for further capacity expansion or contract extension beyond the duration of existing Power Purchase Agreements ( PPA s). Beyond national boundaries, we continue to accelerate our business development activities to expand our portfolio not only in South-East Asia and the Middle East, but also in countries with developed and matured energy markets. In order to mitigate risks and enhance our competitive advantage in securing greenfield as well as brownfield projects, we will seek alliances with strategic partners. Expand Renewable Energy Portfolio ( GDP ) Under the National Renewable Energy Policy and Action Plan, the Malaysian Government is promoting the use of indigenous renewable energy ( RE ) resources. To accelerate investment in RE technologies, the Sustainable Energy Development Authority ( SEDA ) has implemented the feed-in-tariff mechanism to contribute towards the Renewable Energy Fund. We are looking at various options to expand our RE portfolio, including a waste-toenergy project in Kuala Lumpur and run-of-river hydroelectricity projects in East and West Malaysia. We are also focused on developed markets such as Australia and the United Kingdom where electricity production from RE is given high importance. Expand O&M Business Malakoff has a strong culture of operational excellence and a disciplined management system, ensuring that our assets are managed and maintained not only efficiently but are also cost effective. We have developed a reliable operational methodology and this has resulted in some of our plants achieving higher than IPP industry averages. On the strength of our track record, we have successfully secured and executed O&M contracts with numerous third-party clients in Malaysia and internationally. Malakoff, via its subsidiary Teknik Janakuasa Sdn Bhd ( TJSB ) is currently operating power and/or water desalination plants in the Kingdom of Saudi Arabia, Algeria, Kuwait, Indonesia and soon Oman with the completion of the water desalination plant currently under construction. Our total gross capacity for international O&M for power and water as at the end of the year 2014 is 2220 MW and 1,230,000 m 3 per day, respectively. The Group s O&M expansion programme overseas also serves as an important entry point strategy, giving us the opportunity to familiarise ourselves with a new market before committing ourselves to any capital investment. We are presently exploring emerging O&M opportunities in the Middle East and South Asia, as well as other Southeast Asian countries. This will be done through our aggressive marketing activities and participation in the related power and water exhibitions and conferences. Malakoff is targeting to double the contribution from the O&M business to Group revenue by the year MALAKOFF CORPORATION BERHAD Annual Report 2014

45 Expand Electricity and Chilled Water Distribution Business The Group is presently supplying electricity and chilled water for air conditioning to buildings in the Kuala Lumpur Sentral Development Area. There is significant potential to expand this business in similar development projects in major cities throughout Malaysia. Among projects that we are monitoring is the multi-billion Ringgit Tradewinds Square Project, which is located at the heart of Kuala Lumpur s Central Business District and is targeted for completion by the year talent the market can offer, which will be supported by development programmes and comprehensive assessments of talent. This will be supported by a team of dedicated trainers who have the expertise in power operations. On the financial front, the focus will be to optimise our asset portfolio, capital structure and cost of funding. This will be central to the overriding objective of ensuring sustainable growth and meet the expectations of our stakeholders. Ensure Sustainable Growth To ensure our growth is sustainable we have a twopronged strategy to maintain strong operational capabilities whilst driving shareholder returns. Operationally, we aim to attract and retain the top 43

46 Chairman s Statement (continue) What I have presented so far is a snapshot of the strategies in place that will take us to the next level. However, the changes we have made are only the beginning. We have also taken a critical and holistic view of where we stand as an organisation to reflect our corporate strategies and goals. At a Malakoff Town Hall meeting attended by all the senior personnel, an open and frank discussion was held focusing on a proposed new organisational structure. To prepare the Group for the challenges ahead and spur business growth, we talked about the diverse organisational challenges with a view to strengthening reporting lines, harmonising business processes and policies in place. Various approaches were discussed, which among others, aimed at strengthening business processes, centralising certain core activities such as the Accounts, Finance and Safety functions whilst realigning key support services. We want to get all our employees involved in building an even stronger entity. In this regard, a whistle-blower programme has been put in place to encourage employees to report improper activities and workplace concerns. These reports will be evaluated by management and appropriate action, if any, will be taken. Integral to the improvement process group-wide, we recognise the importance of corporate governance to protect the interest of stakeholders. The Board is committed to achieving and sustaining high standards of corporate governance. Towards realising this objective, a Board Risk Committee ( BRC ) was established during the year, whose terms of reference include among others, reviewing the processes for determining and communicating the Company s risk appetite. The BRC reports to the 44 MALAKOFF CORPORATION BERHAD Annual Report 2014

47 Board and provides independent assurance on the effectiveness of the risk management processes that are in place. In addition, we have established an Internal Audit Department, which will assist the Board in monitoring, managing risks and internal controls. AWARDS AND ACCOLADES Capping a remarkable year of achievements, Malakoff won the Anugerah Langkawi 2014 in recognition for its commitment towards preservation of the environment. The award, organised by the Department of Environment Malaysia ( DOE ), was signed by Duli Yang Maha Mulia Seri Paduka Baginda Yang di-pertuan Agong and presented by the Menteri Besar of Kedah, YAB Dato Seri Haji Mukhriz Tun Mahathir, in conjunction with the Minggu Alam Sekitar Malaysia ( MASM ) which was held in Jitra, Kedah on 3 November 2014 Our Port Dickson Power Plant ( PDPP ) won the National Occupational Safety and Health Excellence Award 2014 on 18 December from the Department of Occupational Safety and Health ( DOSH ). Vigorous audits were conducted by DOSH across the country to determine the winner and Malakoff is honoured to receive this award in recognition for its health and safety practices. Malakoff also won Silver at Global CSR Awards Empowerment for Women on 3 April 2014 that was held in Bali, Indonesia. The prestigious accolade is aimed at Malakoff Corporate Social Responsibility ( CSR ) program, Malakoff Empower for Life which has been supporting Women s Aid Organisation ( WAO ) since On 12 November 2014, our Emergency Response Team ( ERT ) from Malakoff Power, Lumut Power Plant ( LPP ) won the Overall Champion title in the Perak ERT Competition organised by Jabatan Bomba dan Penyelamat Negeri Perak. We prospered in retaining our last year s title consecutively which ascertained that our staff are competent in handling emergency situation. ACKNOWLEDGEMENTS In a challenging year, it is gratifying to see how the management and staff of Malakoff have rallied together to address the challenges as a cohesive team. They are the ones growing this Company and we are not finished yet. We have a new addition to our Management Team with the appointment of Dato Sri Syed Faisal Albar as the new Chief Executive Officer ( CEO ) of Malakoff effective 1 July He takes over from Encik Habib Husin who was the Acting CEO and Chief Operating Officer from 1 March Words cannot adequately express my gratitude to a great support group that includes our financiers, partners, business associates, various government bodies and statutory authorities, and not least of all, the members of the media. To our many stakeholders, I thank you for another year of believing in us. We could not have come this far without your support and confidence in the Company, and this has gone a long way in helping us achieve our goals and expand our horizons. I would also like to pay tribute to Tan Sri Dato Wira Syed Abdul Jabbar Bin Syed Hassan, whose term of office ended on 30 November During his three-year tenure as Chairman of Malakoff he has witnessed the transformation of the Company into a truly Malaysian multi-national company. His leadership qualities and wise counsel have been inspiring. The Board and I thank him for his services and wish him every success in his future endeavours. The year 2015 is shaping up to be another exciting year as we stand at the cusp of a new chapter in Malakoff s unfolding story. I trust you will continue to give us your support as we strive to achieve our objectives. Y.A.M. Tan Sri Dato Seri Syed Anwar Jamalullail Chairman 45

48

49 Collaborating Solutions In the constant of a changing landscape that drives Malakoff to create and bring on innovation to the most demanding of challenges, our workforce is embodied by their experience and expertise towards collaborating solutions.

50 Performance Review by Chief Executive Officer Overview Operationally, it was a very satisfactory year, with many significant highlights and achievements both at home and internationally. Although I only came on board as Chief Executive Officer of Malakoff in July 2014, what impressed me most was the Company s performance in the face of challenges. As the largest IPP in the country, the Group has many strengths it can build upon to exploit emerging opportunities in the marketplace and achieve our strategic goals. We have the earnings power, robust business model, expertise backed by a solid track record and an experienced work-force that will contribute greatly to our competitiveness. We also have a clear vision of where we are heading and winning strategies that will take us there. For all these cogent reasons, the Group faces the future with confidence. I personally am convinced that the best years for Malakoff are still to come. One of the significant highlights in 2014 was the establishment of our Internal Audit Department ( IAD ) in March 2014 to take over the function previously outsourced to Ernst & Young. Reporting to the Group Chief Internal Audit Department ( GCIAD ) MMC Corporation Berhad, IAD assists the Malakoff Board via the Board Audit Committee to monitor and manage risks through independent assessments on the adequacy, effectiveness and efficiency of the internal control systems that are in place relating to governance, risk management and control processes. The monitoring process also forms the basis for continually improving a risk management culture within the Company in line with its business goals. In 2014, both IAD and GCIAD Conducted 10 audits and 3 internal control process reviews 48 MALAKOFF CORPORATION BERHAD Annual Report 2014

51 As the largest IPP in the country, the Group has many strengths it can build upon to exploit emerging opportunities in the marketplace and achieve our strategic goals.

52

53 Asset Performance DOMESTIC POWER GENERATION Malakoff is the largest Independent Power Producer ( IPP ) in Malaysia and the Southeast Asian ( SEA ) region, with an effective power generation capacity of approximately 5,346 megawatts ( MW ) representing a significant 24.9 percent market share of the total installed capacity in Peninsular Malaysia. Our power generation assets consist of three combined cycle gas turbine ( CCGT ) power plants, an open cycle gas turbine ( OCGT ) power plant and one coal-fired thermal plant, among the largest privately owned coal-fired plants in SEA accounting for around 29.3 percent of Peninsular Malaysia s total installed coal-fired generation capacity. Through our associates, we also have interest in one power plant with multi-fuel generation facilities. All the power generated is sold to Tenaga Nasional Berhad ( TNB ) under long-term Power Purchase Agreements ( PPAs ). SUBSIDIARY-OWNED POWER PLANTS SEV Power Plant Through our percent-owned subsidiary, Segari Energy Ventures Sdn Bhd ( SEV ), Malakoff has a stake in the 1,303 MW Lumut Power Plant. Now in its nineteenth year of operation, it is the largest CCGT power plant owned by an IPP in Malaysia. In 2013, SEV was awarded a 10-year extension of the PPA to continue selling electricity to TNB until June Throughout FY 2014, the Lumut Power Plant maintained its high performance level in terms of availability, reliability and efficiency. It achieved an average capacity factor of approximately percent and delivered around 7,964 gigawatt-hours ( GWh ) of electricity to the national grid. The plant also registered an availability factor of percent, exceeding the 86.0 percent threshold under the PPA with TNB. By meeting all the required performance criteria, the plant received full capacity payments for the year under review. GB3 Power Plant Malakoff s stake in the GB3 Power Plant is held through its 75.0 percent-owned subsidiary, GB3 Sdn Bhd. Located next to the Lumut Power Plant, GB3 is also a CCGT power plant. Now in its thirteenth year of operation, the plant delivered a total of 1,890 GWh of electricity to the national grid, recording an average capacity factor of about percent for FY The plant s equivalent availability factor of percent has improved slightly from the previous year, mostly due to the reduced number of forced outages. Prai Power Plant The Prai Power Plant is a single shaft CCGT plant with a dependable capacity of 350 MW, and is held through our wholly-owned subsidiary Prai Power Sdn Bhd. One of the most efficient natural gas-fuelled power plants in Malaysia, it recorded a net efficiency (lower heating value) of 52.2 percent during the year in review. Operational since 2003, the plant delivered a total of 2,104 GWh of electricity to the national grid in 2014, recording an average capacity factor of percent. The plant s equivalent availability factor increased significantly to percent for the year in review, in tandem with a reduced number of planned outage days. 51

54 Performance Review by Chief Executive Officer (continue) During the year, the plant also successfully earned certification to the ISO Information Security Management System, which is an assurance of information security of the business. FY 2014 also marked the 12th year of the plant s commercial operations without Lost Time Incident ( LTI ) with a total of 3.4 million man-hours recorded. Port Dickson Power Plant The Port Dickson Power Plant ( PDPP ) is a MW OCGT gas turbine power plant that supplies electricity to the national grid for peaking and emergency requirements. The Group now has a percent stake in the plant, vested in our wholly-owned subsidiary, Hypergantic Sdn Bhd. This follows the acquisition in May 2014 of the remaining 75.0 percent equity interest in the plant. For the past 20 years, the plant has set exemplary performance standards achieving an exceptionally high availability factor of close to 99.0 percent, forced outage rate of less than 0.1 percent and commercial starting reliability of close to percent. In 2014, PDPP won the National Occupational Safety and Health Excellence award 2014 from the Department of Occupational Safety and Health (DOSH). Tanjung Bin Power Plant Malakoff s interest in the Tanjung Bin Power Plant is through our 90.0 percent subsidiary, Tanjung Bin Power Sdn Bhd. The 2100 MW power plant is the first private coal-fired plant in Malaysia and is also one of the biggest independent coal-fired power plants in SEA. It consumes various types of bituminous and sub-bituminous coal imported from Australia, South Africa, Russia and Indonesia. 52 MALAKOFF CORPORATION BERHAD Annual Report 2014

55 For the year under review, the plant delivered a total of 15,308 GWh of electricity to the national grid in FY 2014, achieving an average capacity factor of percent. The plant s equivalent availability factor of percent was also recorded, which is a marked improvement from the previous year. Tanjung Bin Energy Power Plant Capitalising on the increasing role of coal-fired power generation in Malaysia, Malakoff is constructing a new RM6.7 billion of 1,000 MW coal-fired plant next to the existing Tanjung Bin Power Plant. The power generated from the supercritical coal-fired thermal plant is expected to be sold to TNB under a 25-year PPA that will expire in year Several project construction milestones were achieved during the year under review. These included the completion of the flue gas stack, installation of high pressure ( HP ) heaters and de-superheaters at the turbine hall, installation of generator step-up transformer, lifting of generator stator and completion of a new 500 kv extended sub-station. With civil engineering works substantially undertaken, the plant achieved an overall physical completion of 84.0 percent as at end As the project moves progressively into the testing and commissioning phase, a dedicated Operation and Maintenance ( O&M ) team from Malakoff Power Berhad has been mobilised to site. The team will be actively involved in the testing and commissioning of the plant. All Malakoff subsidiary-owned power plants are compliant to the ISO 9001 Quality Management System, OHSAS 18001, ISO Environment Management System and ISO/IEC Information Security Management System. ASSOCIATE-OWNED POWER PLANT Kapar Power Plant Malakoff has a 40.0 percent stake in the Kapar Power Plant vested in Kapar Energy Ventures ( KEV ). Also known as the Sultan Salahuddin Abdul Aziz Power Plant, it is the largest power plant in Malaysia contributing 15.0 percent of the country s energy demand. The Kapar Power Plant has a total generating capacity of 2,420 MW comprising the following facilities: Generating Facility 1 (GF1): 2x300 MW Dual-Fuel Firing (gas and oil) Generating Facility 2 (GF2): 2x300 MW Triple-Fuel Firing (coal, gas and oil) Generating Facility 3 (GF3): 2x500 MW Dual-Fuel Firing (coal and gas) Generating Facility 4 (GF4): 2x110 MW Open Cycle Gas Turbine 53

56 Performance Review by Chief Executive Officer (continue) In FY 2014, the plant recorded an availability factor of percent and overall plant efficiency of percent. For the year, the plant supplied 10, GWh to the national grid. Kapar Power Plant has been equipped with Electrosatic Precipitator ( ESP ) to meet the regulatory particulate emission limits imposed by DOE and has also been certified to the ISO environmental certification. Its 300-hectare ash pond area has become a safe haven for more than 60 species of migratory birds plying the East Asian-Australian Flyway during the annual migratory season. INTERNATIONAL ASSETS Malakoff has a 12.0 percent effective stake in the Shuaibah Phase 3 Independent Water and Power Project ( IWPP ), which is located near Jeddah in the Kingdom of Saudi Arabia. The project is our first overseas venture and consists of a 3x300 MW crude oil-fired power plant and a 880,000 m 3 /day Multi-Staged Flash Distillation Unit for the desalination of sea water. The project was executed on a Build, Own and Operate ( BOO ) basis under a 20-year Power and water Purchase Agreement ( PWPA ) with the Water and Electricity Company of Saudi Arabia. In its fourth or fifth year of operation, the plant continued to perform well in line with expectations. During the year under review, it recorded an availability factor of 92.7 percent and 89.6 percent for power generation and water production respectively. Shuaibah Phase 3 Expansion Independent Water Project (Saudi Arabia) We expanded our market share in the water production business with an 11.9 percent (effective) interest in the Shuaibah Expansion Project Company Ltd. The Shuaibah Phase 3 Expansion Independent Water Project has a capacity of 150,000 m 3 /day and deploys reverse osmosis technology to desalinate sea water. Since its commissioning in 2009, the plant has a commendable performance record achieving an availability factor of 96.4 percent in FY Souk Tleta Independent Water Project (Algeria) The Group made its maiden foray into the North African region with an effective 35.7 percent stake in the Souk Tleta Independent Water Project. The 200,000 m 3 /day plant is located in Wilaya of Tlemcen in Algeria and utilises reverse osmosis technology to desalinate sea water. Since achieving Commercial Operation Date ( COD ) in April 2011, Malakoff has invested significant resources to improve the plant s performance. This paid off in FY 2014, when the plant achieved an availability factor of 76.9 percent, which is a notable improvement from the previous year. 54 MALAKOFF CORPORATION BERHAD Annual Report 2014

57 concluded a project finance loan agreement with three Japanese financial institutions. The successful closing of the financial arrangement signals the Group s re-entry into the Sultanate of Oman. Under a Water Purchase Agreement ( WPA ) with the Oman Power and Water Procurement Co, the project is expected to deliver up to 191,000 m 3 /day of water for a term of 20 years. Al Hidd Power Generation and Water Desalination Plant (Bahrain) With a 40.0 percent stake, the Al Hidd Independent Water and Power Plant stands to date as the Group s largest overseas investment. Comprising three phases, the gas-fuelled plant has a total power generation capacity of 929 MW and water production capacity of 410,000 m 3 /day, using the Multi Stage Flash and Multi Effect Desalination process. During the year in review, the plant had an availability factor of 95.4 percent for power generation and 96.4 percent for water production. Al Ghubrah Independent Water Project (Sultanate of Oman) Malakoff is part of a consortium awarded a contract to build, own and operate the Al Ghubrah Independent Water Project in the Sultanate of Oman. In July 2013, the consortium successfully Macarthur Wind Farm (Australia) The acquisition of a 50.0 percent interest in the Macarthur Wind Farm heralds the Group s first venture into the renewable energy ( RE ) market as well as the Australian continent. The Macarthur Wind Farm is located in the state of Victoria and is the largest wind farm in the Southern Hemisphere. Completed in January 2013, the wind farm recorded an availability factor of 97.9 percent for the year under review. The state-of-the-art Macarthur Wind Farm features 140 Vestas V MW wind turbines, the largest installed in Australia. With a capacity of 420 MW, this is sufficient to power more than 220,000 averagesized homes in Victoria and reduce 1.7 million tonnes of green house gases each year. This is in line with the Australian Government s Renewable Energy Target of 20.0 percent of Australia s electricity comes from renewable resources, by

58 Performance Review by Chief Executive Officer (continue) Operation & Maintenance Malakoff s portfolio of power generation and water production assets is complemented by its strong O&M capabilities. The Group offers O&M services through our wholly-owned Malakoff Power Berhad ( MPB ) and Teknik Janakuasa Sdn Bhd ( TJSB ). MPower services the Group s power plants in Malaysia, while TJSB s client base includes associates, a joint-venture as well as third-party clients for both local and overseas. We have 19 years of O&M experience and a proven track record of operating different power plants, including CCGT, OCGT and coal-fired plants as well as multi-stage flash desalination plants, reverse osmosis plants and multi-effect distillation and co-generation plants. Our systematic approach to O&M performance improvement is centred on enhancing capability development as well as striving for continual improvements with the aim of propelling our asset performance towards sustainable, world-class standards. DOMESTIC O&M BUSINESS The Group has invested in cutting-edge O&M tools and methodology such as Reliability-Centred Maintenance ( RCM ) and Root-Cause Analysis ( RCA ) in striving for continuous improvements. Several projects were undertaken in FY 2014 to enhance the plants capability and reliability, which included an upgrading of the compressor, fogging system, battery charger and other components. To meet high reliability and availability targets, major maintenance and inspection activities were also undertaken. Prai Power Plant The Prai Power Plant is a combined cycle plant consisting of one Gas Turbine, one Heat Recovery Steam Generator and a unique single shaft configuration that provides reliable, efficient and low-emission power supply to the national grid. During FY 2014, an annual scheduled maintenance was carried out on critical components of the plant, including the Gas Turbine and Heat Recovery Steam Generator. SEV and GB3 Power Plants The SEV and GB3 power plants, collectively known as the Lumut Power Plant, continued to demonstrate its proven reliability. Key performance indicators include the average equivalent availability factor, unscheduled outage rate and average capacity factor. Tanjung Bin Power Plant The Tanjung Bin Power Plant continued to play a pivotal role as an anchor plant supplying power to the national grid. Improvement works were carried out at the plant s boiler system in early 2014 to meet higher energy demand from the coal-fired plant and cope with the complexities of utilising various coal types from Indonesia, Australia, South Africa and Russia. During the year, a total of 5.89 million metric tons of coal were delivered to the plant, of which 5.98 million metric tons were consumed as fuel for energy production. In FY 2014, the plant s average capacity factor increased to percent, which translated into 15,308 GWh of energy delivered to TNB. The equivalent availability factor for FY 2014 was percent, while the unscheduled outage rate was recorded at 4.0 percent. 56 MALAKOFF CORPORATION BERHAD Annual Report 2014

59

60 The year in review also saw modification works carried out to increase the capacity of the coal unloading facility to improve vessel turnaround time. It will also cater to the future needs of the adjacent Tanjung Bin Energy Power Plant presently under construction. For the coming FY 2015, a series of major scheduled overhauls involving an accumulated total of 210 days will be executed at all three boiler systems. This will include major modification and replacement works at the reheater outlets and economiser finless tubes to further enhance the reliability and performance of the plant s boiler generating units. INTERNATIONAL O&M BUSINESS Starting out as a domestic player back in 2004, Malakoff has successfully secured and executed O&M contracts with numerous third-party clients, notably in the MENA region. The breadth and depth of our experience cover O&M services for coalfired, CCGT and OCGT power plants, provision of technical, simulator and audit training and overhaul services. The expansion of the Group s O&M business also serves as an entry strategy to familiarise ourselves with a new market or region before committing to any capital investment. The involvement of Malakoff in the O&M activities through its wholly-owned subsidiary, TJSB, continued from its operations in Algeria, Kingdom of Saudi Arabia and Kuwait. In 2014, TJSB through its subsidiary, TJSB Middle East Limited, has successfully mobilised its personnel for the 1200 MW Azzour South CCGT, Kuwait following a newly extended O&M contract with Alghanim International General Trading and Contracting Co.W.L.L. Through another subsidiary, PT Teknik Janakuasa, the company has also mobilised personnel for the 2x60 MW CFPP in Banten, Indonesia. Personnel will soon be mobilised following progress made with our consortium partner to secure an O&M contract for the Al Ghubrah 190,000 m 3 per day Water Desalination Plant in Oman. As part of its expansionary strategy, TJSB will continue to participate in international O&M bidding exercises either independently or with its partners in the MENA, SEA and South Asia regions. MAINTENANCE, REPAIR AND OVERHAUL SERVICES In 2013, Malakoff announced a major alignment of its business units to consolidate its position as a leading IPP in Malaysia and the region. Resulting from the exercise, Malakoff has launched a new 58 MALAKOFF CORPORATION BERHAD Annual Report 2014

61 line of business, namely Maintenance, Repair and Overhaul ( MRO ) services that will be undertaken by TJSB Services, a wholly-owned subsidiary of TJSB. TJSB Services offer maintenance and repair solutions for a wide range of power-related main equipment and its supporting auxiliaries. The range of services include major and minor overhaul of thermal and gas plants and engineering field services. The company also provides a cost-effective solution for customers requiring Original Equipment Manufacturer ( OEM ) support. TECHNICAL SUPPORT GROUP Malakoff s expanding O&M activities are complemented by its Technical Support Group ( TSG ), which has been tasked to review relevant internal processes and recommend improvements to achieve performance targets. During FY 2014, one of notable achievements of TSG was the implementation of a Capital Expenditure ( CAPEX ) initiative to optimise costs. Its proposals for capacity improvements at the Lumut Power Plant have enabled it to sustain its declared capacity up to the end of its PPA in Another outcome of TSG s CAPEX initiative is the launch of a Reverse Engineering Platform that has contributed significantly towards cost savings for maintenance works carried out at the Prai and Tanjung Bin Power Plants. TSG also contributed towards the recovery programme for the Tanjung Bin Power Plant by proposing design changes to the plant s boiler system in areas such as burner modifications, pressure parts assessments and replacement works. 59

62 Performance Review by Chief Executive Officer (continue) RELIABILITY AND PERFORMANCE GROUP The primary role of the Reliability and Performance Group ( RGP ) is to provide consistent, effective and efficient support to all Malakoff locallyoperated plants. This is to deliver compliance to the Group s Policy on Health, Security, Safety and the Environment ( HSSE ), ensure operational excellence and optimise thermal and commercial performance towards attaining the overall business objectives of Malakoff. In fulfillment of its mandate, some of the activities of RPG in FY 2014 were focused on ensuring the consistent implementation of O&M tools and methodologies such as Reliability Centred Maintenance ( RCM ), Condition Based Maintenance ( CBM ) and Root Cause Analysis ( RCA ). The thermal performance of both the Lumut and Prai Power Plants was also closely monitored by RPG deploying a Plant Performance Model based on the Gate Cycle Programme, a powerful and flexible engineering tool to understand and predict changes in a plant s performance. RPG also assisted the HSSE Department in the ISO and OHSAS certification exercise for MPB. RPG continued to leverage on the capabilities of MaCNet, the Information Portal servicing the Malakoff Group. Through the Action Items Management ( AIM ) integrated tool, we are able to track and manage all items related to plant operations that require action. This has contributed towards a more efficient and timely execution of action items. AIM has also facilitated the sharing of information from safety incident reports to all relevant parties so that valuable lessons can be learnt by all and necessary action taken to prevent a recurrence. CONTRACTS AND PROCUREMENT MANAGEMENT The effective management of supply chain management is critical to the successful operations and management of the Group s assets, contributing to overall profitability. This is reinforced by internal audits undertaken in-house, as well as other management audits such as those mandated by the ISO quality certification bodies. These audits ensure the efficacy of the Group s procurement procedures and processes, which are benchmarked against internationally accepted best practices. The Malakoff Group Procurement and warehouse procedures have been revised and approved by the Chief Executive Officer in January 2014 to further enhance the procurement process and incorporate MCB s requirements. The establishment of the Group Contract and Procurement Unit ( GCPU ) under MPB has centralised some of the processes, notably those related to CAPEX procurement. Meanwhile, the year in review saw a new initiative to enhance our Vendor Document and Management Portal ( VDMP ). Called the Procurement Request for Information ( RFI ), it allows registered vendors to know upfront via the portal of our procurement requirements. This will allow vendors to solicit information prior to submitting their quotations or proposals. The RFI initiative will increase the pool of potential vendors for selection and make the procurement process more transparent and competitive. With the impending introduction of the Goods and Service Tax ( GST ) in April 2015, there will be some implications to the procurement process. A subcommittee for procurement has therefore been formed to look at the affected processes and to work with the main committee and the appointed consultant. This is to ensure readiness of our procurement staff and the procurement processing system come 1 April For FY 2014, MPB procurement at plant and headquarters has resulted in savings of around RM35.0 million through various initiatives like price negotiations, competitive bidding, comparisons against budget, among others. Under the duty exemption initiative, we managed a cost avoidance of about RM20.0 million, whereby more than 90.0 percent of our imported materials were exempted from payment of duty. 60 MALAKOFF CORPORATION BERHAD Annual Report 2014

63

64

65 Powering Growth The emerging development of our portfolio requires tremendous amount of natural resources that could never surpass Malakoff s human energy, where the spirit of our people ingenuity and teamwork is powering growth.

66

67 Electricity Distribution & Chilled Water Supply Malakoff s wholly-owned subsidiary, Malakoff Utilities Sdn Bhd ( MUSB ) has been licensed by the Energy Commission to operate an electricity and chilled water business in the Kuala Lumpur Sentral (KL Sentral) Development Area for a period of 21 years. Since 2000, MUSB has been supplying electricity to all the buildings in the development hub on an exclusive basis. MUSB supplies chilled water for air conditioning from its district cooling plant, which is located within the development area. Since November 2001, it has established an unblemished track record of supplying chilled water to the Plaza Sentral Office Towers. To meet the growing requirements of KL Sentral, the capacity of the cooling plant has been increased to 17,000 refrigerant tons. MUSB s customers now include the Nu Sentral Retail Mall, 348 Sentral s Office Tower and Residential Apartments and Excellent Bonanza s Office Towers and Hotel. As at year-end 2014, MUSB had a customer base of 1,982 accounts for both electricity and chilled water distribution. During the year under review, power demand within KL Sentral peaked at MW, compared to MW recorded in the previous year. The spike in demand was attributable mainly to increased occupation rates of buildings. With construction activities ongoing, the upward trend is projected to continue in the coming years. In the Annual Satisfaction Survey, MUSB achieved 91.0 percent score in the Customer Satisfaction Index, surpassing the targeted 80.0 percent. The survey took into account the respondents experience in the critical areas of customer care, billing and payment, operational and technical competence and enquiries and complaints. From the results, MUSB is making every effort to redress perceived weaknesses and improve overall customer satisfaction. MUSB is also adopting a more personalised approach to engaging its customers. To this end, a Customers Week was organised in June and December 2014, providing a platform for customers to raise any questions or concerns with regard to their accounts. Moving forward, MUSB will continue to actively explore opportunities to extend its business beyond KL Sentral. It is also weighing the prospects of embarking on new ventures as a multiple utility provider. 65

68 Performance Review by Chief Executive Officer (continue) CORPORATE SERVICES INFORMATION TECHNOLOGY Information Technology ( IT ) permeates almost every area of the Group s operations. Our primary focus in FY 2014 was to harness the power of IT to improve work processes, preserve data confidentiality and integrity and to automate business processes for greater efficiency. We also addressed the IT issues in readiness for transitioning to a new Goods Service Tax ( GST ) regime that will come into effect from 1 April IT also plays an important role in the Group s Business Continuity Planning ( BCP ) initiative, aimed at strengthening business resilience in the face of a disaster or disruption to business activities. A disaster recovery plan for the Group s IT system remains an integral part of the BCP initiative and tests are conducted at regular intervals to ensure preparedness. During the year, our attention was also focused on upgrading our Information Security Management System ( ISMS ), which is a systematic approach to managing sensitive data so that it remains secure. To this end, we are upgrading our ISMS to conform to the new ISO/IEC 27001:2003 standard, the best known international standard that spells out the requirements for an effective ISMS. Another area of concern is data redundancy, a condition created within a data base where the same data is stored in two places. A software solution has been put in place to ensure that data availability and reliability will not be compromised, especially for mobile users. In the coming year, we will continue to explore avenues for data consolidation, analytics and security measures as an ongoing effort in ensuring business continuity. ENTERPRISE APPLICATIONS Enterprise Applications ( EA ) are business-oriented tools that are an integral part of the Group s IT system. In FY 2014, EA s key initiatives include the implementation of an IT solution to improve the efficiency of the Group s warehouse operations. The Mobile Warehouse Management ( MWM ) application allows instant data flow on the movement of materials to the Enterprise Resource Planning ( ERP ) system through the handheld devices of personnel at every cycle of the warehouse operations. This will include checking inventory levels, updating stock count, issuing of stock as well as transfers and returns, thereby facilitating real-time control over inventories. All inventories are bar-coded to ease data entry during stock movements. Last year also saw the successful implementation of an Asset Tagging and Tracking System ( ATTS ), whereby each fixed asset is tagged with a bar-code to provide relevant asset information. Bar-coded tags simplify the process of asset count, taking only one-tenth of the time, besides being more accurate. ATTS also provides more efficient and cost-effective solution to track fixed asset inventories using wireless scanning devices. 66 MALAKOFF CORPORATION BERHAD Annual Report 2014

69

70 Performance Review by Chief Executive Officer (continue) With the impending introduction of the GST regime by the Malaysian Government, we are working towards the objective of having Malakoff s Systems, Applications & Products ( SAP ) software ready by January The SAP will make it easier for the Group to fulfil GST filing requirements to the Royal Malaysian Customs. Besides capturing GST codes and amounts, the SAP is also a database for filling in the GST-03 form, bad debt reporting, audit file reporting and line item reporting. RISK MANAGEMENT A Board Risk Committee ( BRC ) was set-up in November 2014 in acknowledgement of the growing importance of the risk management function in safe guarding the interests of the Company and its shareholders. The principal role of the BRC is to provide an effective oversight of the Group s risk appetite, risk management function and practices. 68 MALAKOFF CORPORATION BERHAD Annual Report 2014

71 At the same that the BRC was established, the Board also approved the Enterprise Risk Management Policy and Framework ( ERMPF ) which effectively supersedes the Risk Management Policy and Procedures Manual adopted in The new policy and framework is based on ISO 31000:2009 Risk Management Principles and Guidelines codified by the International Organisation for Standardisation ( ISO ). To enhance the structure of the Group s risk management practices, a Corporate Digital Assurance module was employed in the ERMS to ensure that the score card owners, risk owners, control owners and action plan owners provide assurance with respect to the status of all material risks, controls and management actions. During the year under review, a total of 56 riskrelated activities were organised which included a series of risk assessment sessions, reviews and trainings organised across the Group. As at 31 December 2014, a total of 453 risks are registered in the Enterprise Risk Management System ( ERMS ), of which percent of these risks are rated low, meaning that they are being monitored and managed by routine procedures. 69

72 Performance Review by Chief Executive Officer (continue) HEALTH, SAFETY, SECURITY & ENVIRONMENT ( HSSE ) At Malakoff, we believe that a concern for HSSE issues is ultimately a good business practice and we work hard to conduct our business to ensure no harm to the health and safety of people and have no unforeseen impacts to the environment. We believe our HSSE aspirations are achievable and during the year under review, the Group extended its commitment to HSSE by raising standards in all these areas. We are continually enhancing our HSSE initiatives by integrating and strengthening existing systems and procedures. The Group has a non-tolerance stance on safety violations, and over the years we have striven to improve our performance in Occupational Health and Safety (OSH) by inculcating a safety-oriented mindset not only among our employees but also contractors. The goal is to reduce the number of accidents and injuries at the workplace until we attain the ultimate goal of Zero Lost Time Incidents. LOST TIME INJURY FREQUENCY RATE YEAR LPP PPP TBPP MPB HQ MUSB T4 PROJECT ,343 3,441,648 2,762, , ,185 18,100, 000 Total Accumulative Safe Man Hrs worked since Last LTI 25,141, 015 Lost Time Injury Frequency Rate 0.08

73 Among our stable of power plants, the Prai Power Plant was the star performer in FY 2014 with a total of 3,441, 648 man-hours with no LTIs reported during the period. For the Group as a whole, we improved our Lost Time Injury (LTI) frequency in FY 2014 rate to 0.08, compared to 0.28 recorded the previous year. Since the last Lost-Time Injury (LTI) reported in February 2014, the Group recorded 25, 141, 015 million accumulative safe man-hours worked. To drive a safety-conscious mindset, the Group s Competency Base Assessment Modules ( CBA ) were revisited during the year. The CBA provides a comprehensive HSSE competency management reference and it is the responsibility of senior management to cascade, discuss and deliberate the various facets of process and behavioral safety down the line. The Group also leverages on the Malakoff OHS Management System to manage HSSE risks and ensure that operations are conducted in compliance with the HSSE regulatory requirements. In ensuring the effective implementation of OHSMS, a Mandatory Control Framework has also been put in place to strengthen HSSE governance throughout the Group. We also review the Group HSSE Risk Register on a regular basis. The Risk Register is a dynamic tool that provides an overview of the Group s risk status, taking stock of the context of past incidents, plant modifications and amendments to the Group s HSSE standards, among other things. It enables us to identify key risks and our capabilities to address them effectively. From time to time, a HSSE assurance exercise is also carried out by SIRIM, QHSE Internal Auditors and other agencies to provide an independent assessment on the effectiveness of HSSE controls that are in place. The findings are presented to the Management of Malakoff. Moving forward, Malakoff will continue to focus on implementing key risk management strategies and initiatives throughout the Group. It is a moral obligation we owe our employees, customers, constituencies, the public at large and indeed to ourselves. 71

74 Performance Review by Chief Executive Officer (continue) OUTLOOK & PROSPECTS Several major forces will drive the global outlook for In particular, the sharp decline in oil prices since mid-2014 will support global activity and help offset some of the headwinds to growth in oil-importing countries. Overall, global growth is expected to rise moderately, to 3.0 percent in (Source : Global Economic Prospects, January 2015, World Bank) In the 2015 Budget, the Malaysian economy has been projected to expand by between 5.0 percent and 6.0 percent in (Source : Economic report 2014/2015 page 37) As Malaysia is an oil exporter, the slide in oil prices has compelled the Government to announce specific and proactive measures to align the Malaysian economy with the new developments. While volatility persists in the economic environment, Malakoff has never been so well positioned for future dynamic growth. What I have seen since coming on board has also convinced me of the tremendous underlying strength of Malakoff and the business we are in. Looking to FY 2015 and the years ahead, our plans are in place to pursue emerging opportunities in several key markets that will take the Group to the next level. National Electricity Consumption Malaysia s electricity consumption is projected to grow at a Compound Annual Growth Rate ( CAGR ) of 9.7 percent between 2014 and Among the main drivers of growth will be the nation s expanding GDP in the ongoing transformation of Malaysia into a high-income nation by Power supply demand in the Iskandar Development Region is expected to expand at a CAGR of 4.3 percent between 2010 and The Government also plans to establish five new economic growth corridors to promote free trade. To meet the expected increase in demand, the Energy Commission of Malaysia plans to increase Peninsular Malaysia s power generation capacity by an additional 10,923 MW to 11,323 MW between 2014 and MENA Electricity and Water Consumption Beyond Malaysia, electricity and water consumption in the MENA region is set to grow to keep pace with economic and population growth as well 72 MALAKOFF CORPORATION BERHAD Annual Report 2014

75 as increasing urbanisation. Electricity and water consumption is forecasted to expand by 9.4 percent and 2.1 percent respectively between 2014 and Saudi Arabia, Bahrain, Algeria and the Sultanate of Oman have plans to expand electricity and water capacity to meet the growing demand. Electricity Consumption in Southeast Asia Electricity consumption in SEA is expected to grow at a CAGR of 7.9 percent from 2014 to 2018, with increasing urbanisation, liberalisation of the power generation market and abundant availability of fuel. Electricity Consumption in Australia In Australia, the electricity sector will develop organically to register a CAGR of 3.1 percent between 2014 and With the Government s emphasis on renewable energy, wind power generation is projected to grow at a CAGR of around 25.5 percent over the next seven years. ACKNOWLEDGEMENTS At the end of the day, the way to success is through our people. Malakoff s prime assets are the intellectual and creative capabilities of our people. Our people are defined by a set of common values Integrity, Teamwork, Innovation, Excellence and Harmony qualities that differentiate us from our industry peers. In a challenging year, I am especially impressed by how well Malakoff people have pulled together as a team to deliver commendable growth and maintain our momentum in the marketplace. We have come a long way, but as a Company with ambitious plans for the future, a lot remains to be done. I look forward to working with this team as together we look forward to a dynamic and brighter future for Malakoff. I thank all of you. DATO SRI SYED FAISAL ALBAR Chief Executive Officer 73

76

77 Engaging Tomorrow By actively participating to resolve community concerns that remain as relevant to our business, Malakoff stays aligned to societal needs by understanding and listening to considerations that is engaging tomorrow.

78 Corporate Responsibility Malakoff has always lived up to its long-held mission of balancing profitability with a social conscience. Our commitment to Corporate Social Responsibility ( CSR ) is underpinned by the establishment of the Malakoff Community Partnerships in 2009 as the Group s flagship CSR platform. We have also CSR Framework to reinforce our mission to be an active and responsible participant of the community at large. Holistic CSR is something that all of us at Malakoff practise on a daily basis and we never take it for granted, investing significant resources to improve our programmes and ensure its relevance. Our efforts to develop meaningful CSR agendas, policies and initiatives have won the Group numerous awards and accolades over the years and FY 2014 was no exception. We were the winner of two prestigious awards. The first was the Anugerah Langkawi, the most prestigious and authoritative environmental accolade in Malaysia. The Group also won the National Occupational Safety and Health Excellence Award 2014, from the Department of Occupational Safety and Health ( DOSH ) 76 MALAKOFF CORPORATION BERHAD Annual Report 2014

79

80 WORKPLACE DEVELOPMENT Our people are key elements of the Group s strategic assets. As we open a new chapter of dynamic growth, the capacity to deliver results would rest largely on the 960 men and women that make up our workforce. For FY 2014, the human resource emphasis was aimed at sustaining the Group s growth over the long-term in attainment of its strategic mission and vision. To achieve this objective, Malakoff has implemented a robust succession planning framework that will ensure a pipeline of talent to assume senior management positions in the future. Talent Attraction & Retention The Executive Development Programme has been revamped so that the development and learning process of trainees can be fast-tracked before they are absorbed into the workforce. A batch of nine promising hand-picked fresh graduates was provided with additional training, including exposure to projects and hands-on work assignments. Training & Development For FY 2014, a budget of RM3.5 million was allocated to enhance the soft and functional skills of our talent pool. The training calendar included some 128 in-house programmes organised by the Training Department. A Toastmaster Programme was also introduced in November to enhance public speaking and presentation skills of employees. Owing to its resounding success, this has become a monthly feature on the training calendar. Performance Management In striving to be a high-performance organisation, a systematic performance management and appraisal system has been put in place for all levels of staff. A Key Performance Index ( KPI ) has been established that will gauge the performance of employees against quantifiable measures in the quest to meet strategic and operational goals. These indexes allow an employee s performance to be assessed and rewarded accordingly, besides serving as a means to motivate employees to achieve even more. Employee Engagement Even as we continue to grow, we recognise the importance of communications and social events as important tools to strengthen our relationship with our employees. To this end, People Week was introduced during the year to proactively address employees concerns on Human Resource related issues. As we 78 MALAKOFF CORPORATION BERHAD Annual Report 2014

81 become more aware of making the right choices towards a healthy and fulfilling lifestyle, several wellness programmes were also launched. They included a Medical Health & Wellness Programme and Breast Cancer Awareness Month aimed at helping our employees reach a state of optimal well-being. COMMUNITY DEVELOPMENT Wherever we operate, Malakoff aims to earn the respect of the various communities in which we operate as a valued neighbor and friend. While we continue to make sizeable donations each year to many charities and worthy causes, our community outreach programmes take many forms and in recent years, have included the development of local technical expertise, facilitation of community development as well as environmental conservation and protection. Our contributions to local communities are not just donations and sponsorships, but also by actually working with them, hand-in-hand. In the year under review, Malakoff contributed to various community and educational programmes in the villages of Seberang Prai, Segari and Mukim Serkat. This includes providing financial assistance to 409 school children and varsity students, organising religious and sporting activities, supporting tuition, revision and motivational classes, providing financial and medical assistance to the needy and many more. Malakoff also funded the construction of a RM2.6 million mosque in Kampung Sungai Dinar, Mukim Serkat, Pontian, Johor which is scheduled to be completed in May Community Engagement Programmes At Malakoff, we recognise that local community engagement is imperative to the success of our business. Therefore, we are committed to retain this as an integral part of the way we operate and we will continue to invest in more meaningful platforms that will have positive impact on society. 79

82 Corporate Responsibility (continue) Talent Development Programme The Group s foremost commitment has always been to education. This is in line with Malaysia s vision to invest in human capital as a key enabler to build a knowledge-intensive and high-income nation. As part of our efforts to ensure a sustainable pipeline of new talent for the industry, Malakoff has collaborated with Universiti Tenaga Nasional ( UNITEN ) to develop the Malakoff-UNITEN Talent Acceleration Programme ( MUTAP ). For the year under review we hosted a total of 21 promising under-graduates from UNITEN. The year-long experiential programme has been designed to help undergraduates develop new skills through handson experience as well as coaching sessions. During their stint in Malakoff, the students were also involved in various CSR activities and community projects. A batch of students worked closely with a Non-Governmental Organisation ( NGO ) to set up plant nurseries and built bird houses in Bangsar, Kuala Lumpur. Graduates from the Leadership Club established by Malakoff to spearhead youth leadership at UNITEN, helped raise funds for an orphanage and gave the premises a face-lift. Flood Relief Efforts Caring comes naturally for the people of Malakoff and this was amply demonstrated when the worst floods in decades ravaged major parts of the states in the east coast of Peninsular Malaysia in the second half of December Within the MMC Group, some 146 employees and their direct family members were also affected. Along with other operating companies within the MMC Group, we joined our parent company in the flood relief efforts. A donation drive was organised among staff of the MMC Group, raising a total of RM46,300 A team comprising some 100 volunteers from all over the country was also mobilised to distribute much-needed emergency supplies and assist in the clean-up efforts. In the post-flood assistance programme, funds collected from the staff donation drive together with a contribution of RM2.0 million from the MMC Group of Companies, will be disbursed to the flood-affected families to help them rebuild their lives. MARKETPLACE DEVELOPMENT Malakoff recognises the importance of communications as a strategic tool to enhance its relationship with its various publics. Our corporate website provides useful information about the Company, including our organisation structure, Board of Directors and our business activities. It includes a media centre that allows access to the latest news, publications and media clippings. Malakoff also produces an annual report which provides the Group s financial results, performance review, strategic directions and its outlook and prospects. As a Company built on performance, we subscribe to the standards of quality in fulfillment of our responsibility to the market-place. In this regard all our power plants have been accredited to quality management systems endorsed by the International Standard Organisation. We are also committed to responsible HSE management practices in every aspect of our operations. ENVIRONMENTAL PRESERVATION Malakoff aims for sustainable development. In meeting our business goals, we intend to satisfy today s requirements without eroding the livelihoods of future generations. We continue to aggressively pursue waste minimisation and energy conservation opportunities, whilst reducing the carbon footprint of our operations. All our plants in Malaysia have earned certification to ISO 14001, the foremost internationally recognised environmental management standard. 80 MALAKOFF CORPORATION BERHAD Annual Report 2014

83 Outside of our plant operations, Malakoff s green agenda includes proactive measures to conserve the rich bio-diversity of Malaysia in collaboration with the relevant stakeholders. The many long-term projects we have taken under our wing are a true measure of our commitment to the environment. Mangrove Planting Programme Launched in 2009, the programme aims at preserving and restoring the eroding ecosystems in the coastal region around the location of the Group s operations. Since then, some 37,000 mangrove saplings have been planted in Johor and Penang, in collaboration with Johor National Parks and Persatuan Nelayan-Nelayan Pantai Pulau Pinang, respectively. In 2014, Malakoff participated in a replanting campaign organised by the Ministry of Natural Resources and Environment at the Tanjung Piai National Park, under the Sahabat Alam Sekitar programme. Marine Biodiversity Rehabilitation Programmes Together with the Ministry of Natural Resources and Environment, the Department of Marine Parks and the Department of Environment, Malakoff initiated the Coral Rehabilitation and Giant Clam Restoration programmes in a bid to preserve and rehabilitate Malaysia s unique marine ecosystem. The Coral Rehabilitation Programme involves the construction of artificial coral reefs to serve as marine habitats. Marine ecosystem awareness sessions were also conducted at Pulau Redang, Pulau Tioman and Pulau Mentinggi to educate hospitality service providers and local communities on the importance of coral reef conservation. Activities under Malakoff s Giant Clam Restoration Programme in FY 2014 were held at Pulau Mentinggi, off Johor. Going by its scientific name, the Tridacna Gigas or giant clam is the largest living bivalve mollusk and one of the most endangered clam species. They are also among the most ecologically important organisms in the coral reef, working as marine filters by taking in harmful waste nutrients and expelling clean water to the environment. 81

84 Corporate Events Highlights 15 February 2014 Sambutan Maulidur Rasul at Tanjung Bin Power Plant Mukim Serkat village folks and speaker during the occasion. 22 February 2014 Friendly bowling with Tenaga National Berhad Bowling teams of Malakoff and TNB at the friendly game. 22 February 2014 Malakoff wins National Occupational Safety and Health Excellent Award 2014 Malakoff staff with the award and certificate from Department of Occupational Safety and Health (DOSH). 82 MALAKOFF CORPORATION BERHAD Annual Report 2014

85 10 March 2014 Qiblah Direction Setting for Masjid Kg Sg Dinar Representatives of Malakoff and Mukim Serkat with the certificate of Qiblah direction for Masjid Sg Dina. 11 March 2014 Kumpulan Wang Amanah Pencen visits Tanjung Bin Power Plant Visitors from KWAP were given a site tour of Tanjung Bin plant. 29 March 2014 Malakoff Uniten Talent Acceleration Program (MUTAP) Graduation Day Graduates are enthusiastic with the certificate in hands. 01 April 2014 Malakoff s Board of Directors visit Tanjung Bin Power Plant Directors and Malakoff staff at the coal control room during the site tour. 83

86 Corporate Events Highlights (continue) 07 April 2014 Signing Ceremony of the acquisition of Port Dickson Power Berhad Encik Habib Husin and Dato Ir. Jauhari Hamidi exchanging the documents. 18 April 2014 Northern Region Friendly Bowling Tournament Bowlers receiving the winning prizes after the tournament. 06,07, 08 June 2014 Malakoff Sports Carnival at Lumut Power Plant The participants cheering at the end of the game. 84 MALAKOFF CORPORATION BERHAD Annual Report 2014

87 12 June 2014 Ceramah Perdana Israk Mikraj Malakoff staff and folks from Kg Segari with the speaker, Ustaz Zamri Zainurdin. 13 June 2014 Friendly football with Energy Commission (EC) Teams from Malakoff and EC exchanging the friendly souvenirs before the game starts. 26 June 2014 Malakoff Giant Clam Restoration Project Deputy Minister of NRE, Dato Sri Dr. James Dawos Mamit handing over the giant clam to a diver to be placed in Pulau Mentinggi. 85

88 Corporate Events Highlights (continue) 15 August 2014 Majlis Hari Raya Lumut Power Plant Staff and family members being served with delicious food. 20 August 2014 Majlis Hari Raya Port Dickson Power Plant Staff and relatives enjoying the raya feast during the open house. 22 August 2014 Majlis Hari Raya Tanjung Bin Power Plant Malakoff s guests having delightful raya feast. 86 MALAKOFF CORPORATION BERHAD Annual Report 2014

89 28 August 2014 Majlis Hari Raya Prai Power Plant Malakoff staff having a blast at the Raya open house. 29 August 2014 Friendly Bowling with Energy Commission (EC) Bowlers of EC and Malakoff in high spirit before the start-off. 06 September 2014 Friendly futsal tournament with Tenaga Nasional Berhad (TNB), Energy Commission (EC) and Economic Planning Unit (EPU) Participants posing at the end of the tournament. 87

90 Corporate Events Highlights (continue) 11 September 2014 PowerGen 2014 TJSB participated in PowerGen 2014 held at KLCC Convention Centre. 01 November 2014 Malakoff Receives Anugerah Langkawi 2014 Menteri Besar Kedah, Dato Seri Mukhriz Mahathir with representatives from NRE and Malakoff together with Anugerah Langkawi award. 11 November 2014 Malakoff Power LPP won Perak ERT Competiton 2014 Malakoff staff shows excellent effort during the competition. 88 MALAKOFF CORPORATION BERHAD Annual Report November 2014 Mangrove Tree Planting Program Malakoff, DOE and Rakan Alam Sekitar during the Mangrove Tree Planting Program at Taman Negara Tanjung Piai, Pontian.