Chairman s Statement. TA Enterprise Berhad Annual Report 09. Datuk Tiah Thee Kian. Executive Chairman

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1 Chairman s Statement The Group is in a net cash position of RM398 million and has a low gearing of 0.06 times. Barring unforeseen circumstances, the Group will be able to ride through the current economic turmoil unscathed and even to emerge stronger. The Group has ample liquidity to capitalize on any viable business opportunity. Datuk Tiah Thee Kian Executive Chairman In the midst of the prevailing economic uncertainties and pessimism, we will endeavor to improve our service quality and cost efficiency to maintain our competitiveness and to enhance our market share. Derivatives TA Futures Sdn Bhd (TAF) has once again garnered the Top Commodity Futures Broker s award for by Bursa Malaysia Derivatives. With the exception of 2006, TAF has been the Top Commodity Futures Broker from 2003 to. The company is confident of maintaining its strong position in palm oil futures in the next fiscal year. Going forward, TAF will soon be able to offer the Direct Market Access (DMA) facilities. DMA will allow our institutional and retail clients to have remote direct trading access to our domestic markets. The prospects of the derivatives market in Malaysia remain positive especially in palm oil futures as it is now one of the world s largest traded edible oil. Unit Trust and Asset Management For the financial year ended 31 January, TA Investment Management Berhad (TAIM) has total assets under management of RM528 million, being a combination of unit trust funds and direct mandate portfolios under its management. TA Growth Fund garnered the EdgeLipper s No.1 Fund in Equity Income Funds category for the 10year period ending 31 December. This recognition was for TAIM s efforts in delivering superior and consistent medium to longterm returns to investors who have entrusted their investment to TAIM. TAIM launched two new Funds namely, TA Dana Fokus (TADF) and TA North Asian Opportunities Capital Protected Fund (TANAOCP). TADF is the fifth Shariahcompliant fund and is eligible for investment under the Employees Provident TA Enterprise Berhad Annual Report 09 9

2 Chairman s Statement Fund (EPF) Members Investment Scheme. TANAOCP is our very first closeended Capital Protected Fund which aims to provide capital appreciation as well as capital protection upon the fund s maturity. It is suitable for investors who remain skeptical or are reluctant to enter the market. As at the financial year end, TAIM has 16 unit trust funds under its management, of which 5 are Shariahcompliant funds and the remaining 11 are conventional funds. Its portfolio comprises a wide spectrum of funds ranging from low to high risks and caters to the different financial needs and objectives of investors. TAIM aspires to leap to greater heights of success through concerted and sustained effort. It is confident of achieving its niche in this increasingly competitive industry. TAIM will continue to upgrade its delivery systems as well as to increase the number of institutional unit trust consultants for efficient distribution of products and services to investors. Credit and Lending For the year ended, TA First Credit Sdn Bhd (TAFC) recorded a net operating loss of RM51.5 million. The loss was mainly attributed to the huge provisions for doubtful debts on financial receivables and investments totaling RM50.6 million. TAFC has been active in providing financing for Employee Share Option Schemes (ESOS) of public listed companies and also financing of Initial Public Offers (IPOs) for newly listed shares on Bursa Malaysia. However, these business activities have slowed down due to the current financial and economic downturn. TAFC will continue to provide financing to individuals for investment purposes. We will also provide short and medium term loans to companies to assist them in their working capital requirement and for business expansion. Top Right: Mr. Choo Swee Kee, Mr. Wong Mien and Datin Alicia Tiah officially launching TA Dana Fokus, the fifth Shariahcompliant fund by TA Investment. Top Left: Amania, Damansara Idaman is designed with natural splendour. Middle: Damansara Idaman was awarded for the CNBC Asia Pacific Property Award. Bottom: Idaman Residence was handed over in February with CF. Committed efforts will be made in the recovery of delinquent accounts and we are cautiously optimistic that we will be able to write back interest income suspended and provisions for doubtful debts on financial receivables made earlier. 10 TA Enterprise Berhad Annual Report 09

3 Chairman s Statement PROPERTY DEVELOPMENT The financial year ended 31 January, marks a challenging year with the softening of property sales as a result of the global economic crisis. Despite these setbacks, I am pleased to announce that TA Properties Sdn Bhd s contribution to the Group s net operating profit has increased to RM165 million from RM67.5 million in the last financial year. Malaysia Damansara Idaman The maiden effort in luxury residential development by TA Properties Sdn Bhd (TAP) bore fruit in July when Damansara Idaman, an exclusive gated and guarded bungalow development in Petaling Jaya was awarded the coveted CNBC Asia Pacific Property Award for Best Development ( 4 stars ) in Malaysia. The final phase of Damansara Idaman named Amania was unveiled in November. It comprises 27 units of Garden Bungalows. Construction has commenced in April and completion is targeted for March Idaman Villas A freehold, gated and guarded development comprising 54 units of semidetached villas was initially launched in February We are glad that in spite of the sluggish property market, we have sold nearly 70% of our development as at end April. Idaman Villas is truly a distinctive residential address that combines the natural ambience of the outdoor with the beauty and elegance of contemporary designs. Construction was completed in early and vacant possession was obtained in March. We are currently in the process of handing over the sold units to the respective purchasers. Idaman Residence A 34storey freehold condominium designed by the award winning architect, Ken Yeang was launched in late This is TAP s first high rise development in Kuala Lumpur and we have achieved 92% sales as at end April, because of its strategic location and proximity to the acclaimed Petronas Twin Towers. The development was completed in mid February together with vacant possession. The Certificate of Fitness was issued by the local authority at the end of February. We are currently handing over our sold units. NEW PROJECTS Mixed Commercial Development in Sri Damansara A freehold mixed commercial development that will spread over a 48 acres site and is poised to be a landmark development in Petaling Jaya. The area is accessible via major highways namely, the LDP, SPRINT and NKVE. Main features are a lifestyle retail mall with courtyard and streetscape themes, shopoffices, corporate office towers, service apartments, hotel and alfresco styled F&B outlets. The entire project will be implemented in several phases over a period of 710 years. We have submitted the amendments of our planning approval to Majlis Bandaraya Petaling Jaya (MBPJ) on 16 February. Our first launch consisting of shopoffices and Small Office Home Office (SOHO) units is scheduled to be in the first quarter of Mixed Commercial Development in Bukit Bintang This 3.3 acre freehold commercial development is strategically located in the heart of the Golden Triangle in Kuala Lumpur. Nova Square will encompass a 5star hotel tower, one block of fashionable luxury residences, a gradea office tower and a lifestyle podium comprising alfresco F&B outlets, a banquet hall and boutique shop units. Mixed Commercial Development opposite KLCC A proposed integrated highend commercial development consisting of two towers is located directly opposite the worldrenowned Petronas Twin Towers. This project includes a luxury hotel, service residences and an upscale retail podium, which will be linked to our existing Menara TA office block. Boutique Residential Development at Jalan UThant Located at Jalan UThant, a highly sought after residential address in Kuala Lumpur s city centre, is our proposed development of a 1.4 acre freehold land with lowdensity and luxurious residences. This development is proposed to consist of opulent condominium units that will set a new benchmark for TA Properties as a highend property developer. Condominium Development at Dutamas Proposed development of contemporary styled condominiums with sizes ranging from 900 to 2400 square feet, on a 4.5 acre of freehold land, located next to Mont Kiara. TA Enterprise Berhad Annual Report 09 11

4 Chairman s Statement PROPERTY INVESTMENT The Group s portfolio of property investments is predominantly located in Malaysia, Canada and Australia. These income yielding properties have consistently provided the Group with a steady rental income and returns. Going forward, our strategy for property investments is to look for investment properties with a healthy cash flow and to utilize our property management division to create more value and to give better return to the Group. Malaysia In Malaysia, Menara TA One, a 37storey building in the Golden Triangle of Kuala Lumpur, continues to serve as the corporate headquarters for TA Enterprise Bhd and its group of companies. We occupy approximately 40% of the building with the balance 60% tenanted out to various corporations. Menara TA One together with our shop offices at USJ Taipan and Subang Business Center, which are currently being managed by us, continues to yield good rental income to our local property investment division. Canada Terasen Centre, our triplea rated office tower in Vancouver, Canada has held pretty strong during the downturn. The average occupancy rate for was 98.93% versus 97.63% in the previous year. Currently, we have a good tenant mix from a range of sectors such as healthcare, telecommunications, financial and wealth providers, careers and human resources, mining and utility, solicitors, real estate, construction and highway builders. In general, the current average remaining lease period amongst our tenants is 5 years. For the year, our rental rates saw a doubledigit increase of 10.3%, a yearonyear increase to C$20.04 per sq foot for. Total revenue also saw a 7.3% growth to C$14,833,614 from C$13,822,322 last year. Although, the global economic downturn has affected the overall demand and increased sublease space but the market remains relatively tight and steady as we are seeing low vacancy levels at 4.6%. HOTEL OPERATIONS Our property investment in hotels is predominantly in Australia and Canada. In year, we have expanded our hotel portfolio by acquiring 2 hotel properties in Whistler, Canada and Melbourne, Australia. Although, the demand for hotels will be affected in as consumers hold back their holiday plans and businesses scale down on hotel grade due to the economic downturn, we believe that the strategic location of our hotels in Australia and Canada will be a distinct advantage in sustaining our occupancy rate and return for the relevant hotel properties. Sydney, Australia Radisson Plaza, our 362 rooms boutique style modern international fivestar hotel in the Central Business District of Sydney continues to provide a steady revenue to the Group. For financial year, it contributed 10.2% towards the Group s net operating profit. Radisson Plaza Hotel has consistently received several industry accolades for its operational and service excellences. In year, it won 7 major awards and emerged as a finalist in 6 other Awards. It was rated as Australia s Leading Business Hotel by World Travel Awards for and maintained its popularity as the Top 10 Best Luxury Hotels in the South Pacific and Top 25 Most Popular Hotel Destinations in the World in Trip Advisor Travellers Choice Award for. The hotel s stature in terms of its management was further endorsed by its employees winning the Carlson Hotels Awards for Esprit Award General Manager of the Year, Aspire Award and Carlson Fellows Stewardship Award. The hotel s fine dining restaurant, Bilson s Restaurant also made headlines again by winning the Restaurant of the Year award from the Australian Hotels Association (AHA) of New South Wales. The Hotel s go green initiatives did not go unnoticed. It was a finalist in the Business Award Water Management category for New South Wales Government Sustainability Green Globe Awards. Melbourne, Australia With the weakening of the Australian dollar and softer property prices in Australia, the Group saw the opportunity in investing in The Westin Melbourne when the property was available for sale. In December, we acquired the award winning hotel, The Westin Melbourne for A$160 million (approximately RM374.7 million) and completed the acquisition on 21st April. The Westin Melbourne is a freehold luxury fullservice fivestar hotel of 262 large guest rooms, guest suites and typical hotel amenities over 9 floors. It is ideally located within the heart of the city s CBD with immediate proximity to Melbourne s primary business and leisure. It sits in the heart of Melbourne s retail, commercial and entertainment district. It has a frontage to City Square on Swanston Street and is conveniently accessible vide portecochere from both Collins Street and Flinders Lane. The Westin Melbourne is widely regarded as the benchmark leader in the Melbourne hotel market. Since 2005 it has 12 TA Enterprise Berhad Annual Report 09

5 Chairman s Statement Top Left and Right: The Westin Melbourne, a freehold luxury fullservice five star hotel acquired by TA in December. Top Left: The Exterior of Westin Melbourne. Top Middle: Lobby Lounge. Top Right: Studio 2 Bottom: Aava Whistler, Canada opening in November to usher in the 2010 Winter Olympics. accumulated numerous awards and achievements and in year, it was named in the Conde Nast traveler s gold list as one of the best places to stay in the world. Recently, it was voted as one of the top 5 business and leisure hotels in the Qantas Frequent Flyer Hotel Survey. The Westin Melbourne has consistently been one of the best performers among its 5star competitive set. Its room rates have consistently grown since 2004, with an increased room rates from A$ to A$ Its occupancy has subsequently grown to 82.8% for the 12 months ending 31 July which is consistent with the remainder of the Melbourne hotel market and this performance is slightly above its 5star competitive set. Its Average Daily Rate (ADR) has also grown to A$ for the same period. With its commendable performance amongst its competitive set, its prime location, award winning services and facilities plus an unrivalled proximity to key demand drivers, we believe The Westin Melbourne will produce an attractive investment opportunity for the Group and will contribute positively to the Group s earnings. Whistler, Canada During the year, the Group has also successfully acquired another hotel, Coast Whistler for RM107 million (CAD$33 million). The acquisition was completed on 22nd December and the hotel is now rebranded as Aava Whistler. Aava Whistler is located in Whistler, a Canadian resort town in the Pacific Ranges of the Coast Mountains, approximately 125 km north of Vancouver. The hotel is currently closed for renovation and is scheduled to reopen in November, in time for the 2010 Winter Olympics. The newly renovated hotel will be a 4star hotel consisting of 180 guest rooms located within 2 wings, namely the East Wing and West Wing. With Whistler hosting the 2010 Winter Olympics between 15th and 28th February 2010, we believe Aava Whistler will contribute positively to the Group s earnings in the coming year. TA Enterprise Berhad Annual Report 09 13

6 Chairman s Statement PROSPECTS AND OUTLOOK will be a difficult year for Malaysia in view of the adverse repercussions of the global financial crisis. The manufacturing sector is already feeling the impact of the slowdown in the form of low export orders and rising retrenchments as our economy relies heavily on external demand. As the manufacturing sector makes up 18% of the labour market, the corresponding negative implications on consumption and the broader economy are real. The Government recognizes the threat and introduced two rescue packages totaling RM67 billion to prop up domestic demand and to sustain economic growth. But even then, the official GDP forecast of 4% to 5% for borders on skepticism (revised lower from earlier 1% to +1% after a worsethanexpected 6.2% contraction in the first quarter of ). The effectiveness of the stimulus plans and fiscal measures to revive the economy not only hinges on the ability to execute the measures in a timely manner; but also the speed of recovery of the global economy after the injection of trillions of US dollars to rescue battered financial institutions; the setting up of financial controls for global governance and regulation of the financial and derivative markets and hedge funds. So far, Bank Negara Malaysia has been very accommodative in its monetary approach. The benchmark interest rate is likely to remain at 2% throughout and is unlikely to ease further as the Malaysian economy is anticipated to recuperate by yearend. Nonetheless, should there be any future economic weaknesses ahead, there is room for lowering the Overnight Policy Rate considering the receding trend in cost push inflation towards 1.0% yoy for. Nevertheless, Bank Negara may exercise caution in doing so as it will suppress depositors of positive rate of returns. This accommodative monetary stance will be more conducive for the property market although investors are currently holding back on big ticket investments. As confidence in the economy is expected to improve over the next six months, the change in mood is likely to trigger fresh interest in the equity market as well as the property sector. The Group is ready to seize the opportunity through our strong asset base and strategic land bank. We foresee a challenging year ahead for the stockbroking industry. It has certainly not been spared by the hostile macro environment and is today plagued by declining trade volumes and margin pressure due to low brokerage fees and intense competition within a highly saturated industry. Nonetheless, the global equity markets are expected to show some signs of recovery in late as the trillions of US dollars pumped by governments around the world to check recessionary pressures work their way into stabilising financial markets and improving the economy. Malaysia s huge RM67 billion stimulus packages will boost domestic demand while exports go through a recovery phase. As more signs of economic recovery emerge in the second half of, market sentiment is expected to improve along with trading velocity. Trading velocity has already rebounded to 55% level in June compared to as low as 10% in January this year. In response to the current weak economic climate, new business strategies are created to maintain market share and profitability for the industry as a whole. Fee based business activities such as corporate finance and advisory services, placement and underwriting activities and the offer of structured products are enhanced to meet the varying needs and risk appetite of individual investors. Bursa s commitment to strengthen the stockbroking industry and to encourage trades through the introduction of new and exciting products and services; strengthening liquidity through continued retail education; producing a market making framework; restructuring minimum bids/spread size, and encouraging the selling and buying of Islamic Securities augurs well for the industry. Looking forward, we are bracing ourselves for a softened and subdued property market, given the slowdown in economic growth. However, the Group is well positioned to ride through the current weak period and will seize the opportunity to buy land banks in strategic locations for future development and invest in niche properties with capital appreciation potential and which also give above par yield. Meanwhile, we see a silver lining in the form of improved profit margin due to dwindling construction costs. As such, we will expedite the construction progress of our existing projects. At the same time, we would seek approvals from relevant authorities for our new developments so that they are ready to be launched when the tide turns. ACKNOWLEDGEMENT On behalf of the Board, I would like to express our appreciation to all our valued shareholders, business partners, clients, financiers and all government authorities for your support and trust in our Group. I also wish to thank our remisiers, agents, management team and staff of TA Group for their commitment and invaluable contribution that have seen us through the good and tough years. Last but not least, I would like to record my appreciation to every board member of TAE and its subsidiaries for your advice and guidance to me throughout the year. Datuk Tiah Thee Kian Executive Chairman 14 TA Enterprise Berhad Annual Report 09

7 Thank you to all our people

8 dedicated to social responsibility

9 Corporate Social Responsibility Corporate Social Responsibility (CSR) promotes expanded stewardship by businesses and organizations in that they embrace responsibilities toward a broader group of stakeholders (customers, employees and the community at large), in addition to their customary financial obligations to shareholders. TA s Corporate Social Responsibility to the Community Dedication to Corporate Social Responsibility is embodied as one of the five core values of TA Enterprise Bhd (TA). Since its inception, TA has been supporting worthwhile causes both locally and overseas and has forged strategic relationships with charitable organizations to bring relief to the underprivileged, aged, the abandoned and abused street children and orphans. In November, we organized TA Charity and Family Carnival at our home ground along Jalan P. Ramlee to raise funds for four selected beneficiaries namely, Shepherd s Centre Foundation, Persatuan Penyayang Nur Iman Kuala Lumpur, Montfort Boys Town and Desa Amal Jireh. The carnival concluded on a high note and was brought to a successful fruition although we did not have any previous experience in organizing such a big scale fund raising event. TA Securities s Ipoh Branch organized a day out in August with 40 children with mental handicaps to the Lost World of Tambun theme park. Back in Kelantan, employees of TA Securities in Kota Bahru repainted Rumah Sri Kenangan, a home for 140 old folks. In September, TA Securities s Kuching Branch participated in The Salvation Army s Sale of Work event in which all proceeds from the sale was donated to the Salvation Army Kuching. For this year, we continued our CSR heritage by working with the doctors and nurses of the Pediatrics Institute of General Hospital, Kuala Lumpur (GHKL) in organizing a fun day for the young patients. Employees of TA Group spent two Saturdays to brighten up the children s treatment room with colourful mural paintings on the walls. On 23 April, we hosted a cheer party for the children and mothers to spread joy and laughter with songs, games, puppet show, food and gift packs. TA Enterprise also donated a number of slim screen televisions and a set of video game console to the hospital. Top: TA Charity and Family Carnival organised at our home ground to raise funds for the needy Middle: TA Securities s Ipoh Branch organized a day out with 40 children with mental handicap to the Lost World of Tambun theme park. Bottom: Datin Alicia Tiah and TA Volunteers spreading joy and laughter to the children in GHKL. Reverse: TA Staff painting mural for GHKL. TA Enterprise Berhad Annual Report 09 17

10 Corporate Social Responsibility TA s Corporate Social Responsibility to the Environment In August, an environment awareness campaign was organized in Menara TA One whereby employees of TA were invited to view the screening of An Inconvenient Truth, an inspiring global warming documentary. In this eyeopening film, staff members of TA were exposed to the facts on the impact of global warming towards the environment. In conjunction with this campaign, a memo was issued to all staff to collectively reduce paper usage within the organization. Towards the end of, light bulbs in all common areas and car park of Menara TA One were changed to energy saving lights. In Ipoh, TA Securities teamed up with the Global Environmental Centre (GEC) and Malaysian Nature Society (MNS) by organizing a gotongroyong at Padang Rekreasi Sultan Abdul Aziz, Ipoh. We took this opportunity to share with the public on the urgency of preserving and supporting a clean, healthy and sustainable planet earth. In year, TA s wholly owned property investment in Australia, Radisson Plaza Hotel, Sydney participated in the New South Wales Golden Green Awards. The Green Globe Awards are the leading environmental awards in New South Wales (NSW), Australia which showcase outstanding achievements in the sustainable use of natural resources in NSW and leadership in tackling climate change. The awards are open to individuals and organizations within the private, public and community sectors who demonstrate outstanding achievement in sustainability and climate change leadership; water, energy and waste savings; reduction of greenhouse gas emissions and adaptation to climate change. Radisson Plaza Hotel s gogreen initiatives did not go unnoticed when it came up as one of the finalists in the Business Award Water Management category. TA s Corporate Social Responsibility to its Human Resources As at 31st January, we have a total work force of 637 employees within TA Group of Companies in Malaysia. In line with TA s core value of being people focused, promoting the well being of our employees has always been of high priority. In November, TA provided temporary accommodations for its employees and their family members affected by the massive landslide in Bukit Antarabangsa. Once evacuated from their homes, we housed them at one of our luxurious property s show unit until it was safe for them to return home. During the petrol price hike in June, TA reviewed its employees traveling allowances to ease their burden on the sudden increase in fuel prices. Encouraging a worklife balance lifestyle amongst its workforce, employees of TA are given free gym membership at our fully equipped gym located on the 11th Floor of Menara TA One. Varieties of fitness classes are also offered to our employees at the TA s Gymnasium at a minimal fee. As part of our commitment towards our employees, medical; critical illnesses and group personal accident insurances are provided. These insurance benefits were also extended to our employees immediate family members. In addition, an extensive prolonged illnesses scheme is provided for our work force whereby they can be rest assured that their jobs in TA are secured for 18 months should they be diagnosed with prolonged illnesses. This enables them to have a peace of mind while recuperating. On the other hand, we emphasize strongly on the safety of our staff particularly at construction sites by making it compulsory for everyone (including outsiders) to put on safety gears at all times at sites. TA extends its products and services to its employees at discounted prices. Projects of TA Properties, personal loan by TA First Credit and unit trust funds by TA Invest are offered to staff members at a special rate. Valuing feedbacks and opinions of our employees, town hall meetings and employees surveys are conducted regularly to ensure a two way communication means. Conclusion The Group affirms that in the ethical conduct of its business and the carrying out of its corporate responsibilities, the Group is creating value for all its stakeholders and strengthening the long term sustainability of the Group. 18 TA Enterprise Berhad Annual Report 09

11 focused on people TA Enterprise Berhad Annual Report 09 19

12 Corporate Information Board of Directors Company Secretaries Share Registrar Datuk Tiah Thee Kian Executive Chairman Datin Tan Kuay Fong Managing Director & Chief Executive Officer Zainab Binti Ahmad Executive Director Dato Sri Mohamed Bin Abid Executive Director Peter U Chin Wei Independent NonExecutive Director Jory Leong Kam Weng Independent NonExecutive Director Christopher Koh Swee Kiat Independent NonExecutive Director Khoo Poh Kimmy (LS 04542) Yong Kim Kiong (MIA 19777) Registered Office 34th Floor, Menara TA One 22 Jalan P. Ramlee Kuala Lumpur, Malaysia Tel : Fax : Audit Committee Peter U Chin Wei Chairman Jory Leong Kam Weng Member Tenaga Koperat Sdn. Bhd. Level 17. The Gardens North Tower Mid Valley City Lingkaran Syed Putra Kuala Lumpur Tel : Fax : Auditors Ernst & Young Stock Exchange Listing Bursa Malaysia Securities Berhad Main Board Stock Code 4898 Rahmah Binti Mahmood Independent NonExecutive Director Christopher Koh Swee Kiat Member From left to right: Rahmah Binti Mahmood, Christopher Koh Swee Kiat, Dato Sri Mohamed Bin Abid, Zainab Binti Ahmad, Jory Leong Kam Weng, Peter U Chin Wei. Opposite Page from left to right: Datin Tan Kuay Fong, Datuk Tiah Thee Kian. 20 TA Enterprise Berhad Annual Report 09

13 Directors Profile YG BHG DATUK TIAH THEE KIAN Executive Chairman Yg Bhg Datuk Tiah Thee Kian, aged 62, a Malaysian, holds a Bachelor of Science from University of Malaya and a Master in Business Management from Asian Institute of Management, Philippines. He started his career as a manager of Malaysian International Merchant Bankers Bhd from year 1972 to year He then joined Credit Leasing Corporation Sdn Bhd as an Executive Director from year 1978 to He is the substantial shareholder and cofounder of TA Enterprise Berhad. He joined TA Securities Berhad as a General Manager in September 1987 and was appointed the Managing Director in November 1988 and thereafter, Executive Chairman in July In year 1990, he initiated the public listing of the stockbroking business of TA Securities Sdn Bhd under TA Enterprise Berhad and took over the helm as the Executive Chairman and Managing Director of TA Enterprise Berhad in October 1990, a position that he held till May On 16 August 2007, he resumed his position as the Executive Chairman of TA Enterprise Berhad. He also sits on the Board of TA Global Berhad, a public company which is a whollyowned subsidiary of TA Enterprise Berhad. As a financial person, he brings with him a wealth of experience and knowledge in financial and corporate matters. He is conversant in share investments and property development both in Malaysia and overseas. As the Executive Chairman of TA Enterprise Berhad, he provides the vision and strategic direction to propel the TA Group to greater heights. He is the Chairman of the Company s Property Management Committee, Group Investment Committee and Tender Committee. He is the husband of Yg Bhg Datin Tan Kuay Fong, Managing Director & Chief Executive Officer of the Company. He has attended all seven of the Board Meetings held during the financial year. He is deemed interested in the following agreements: (a) Sale and Purchase Agreement dated 4 September entered into between TA Global Berhad, a subsidiary of (b) the Company and No. 205 Cathedral Ventures Limited ( Cathedral Ventures ) to acquire Coast Whistler Hotel ( Sale and Purchase Agreement dated 4 September ). The Sale and Purchase Agreement dated 4 September was rescinded and superseded by a new agreement dated 19 December between ERF Properties Sdn Bhd, another subsidiary of the Company, and British Columbia Limited for the purchase of the beneficial interest in Coast Whistler Hotel and the shares in Cathedral Ventures ( New Agreement dated 19 December ). Yg Bhg Datuk Tiah, the Executive Chairman and substantial shareholder of the Company, is also the ultimate beneficial owner of British Columbia Limited. On 10 May 2002, he was convicted in the Sessions Court in Shah Alam, Selangor for permitting the furnishing of a false report on share prices to the Kuala Lumpur Stock Exchange and was convicted and fined RM3,000,00000, which he paid on the same day. TA Enterprise Berhad Annual Report 09 21

14 Directors Profile YG BHG DATIN TAN KUAY FONG Managing Director & Chief Executive Officer Yg Bhg Datin Tan Kuay Fong, aged 58, a Malaysian, holds a Bachelor of Economics (Honours) Degree and a Post Graduate Diploma in Accounting from the University of Malaya. She is the cofounder of TA Enterprise Berhad. She joined TA Securities Berhad in 1987 as an Executive Director and was appointed the Managing Director in July She resigned from the Board of TA Securities Berhad on 23 June 2003 to concentrate on the property investments and other business activities of the TA Group. She was appointed as Executive Director of TA Enterprise Berhad on 13 March 1990 and subsequently was appointed as Executive Chairman of TA Enterprise Berhad on 10 May On 16 August 2007 she was redesignated as Managing Director & Chief Executive Officer of TA Enterprise Berhad. She also sits on the Board of TA Global Berhad, a public company which is a whollyowned subsidiary of TA Enterprise Berhad. She has gathered extensive experience in financial services, property management and property development. Her experience and expertise incorporate strategic development, operational planning and implementation, international business expansion and overall business management. She is a member of the Company s Property Management Committee, Group Investment Committee, Tax Planning Committee, Option Committee, Tender Committee and Information Technology Management Committee. She is also an advisor to the Stockbroking Management Committee. She is the wife of Yg Bhg Datuk Tiah Thee Kian, Executive Chairman and a substantial shareholder of the Company. She has attended all seven of the Board Meetings held during the financial year. She is deemed to have vested interest in the Sale and Purchase Agreement dated 4 September and New Agreement dated 19 December mentioned in Yg Bhg Datuk Tiah s profile, by virtue of Section 122A of the Companies Act, Yg Bhg Datin Tan being the Managing Director & Chief Executive Officer of the Company and the wife of Yg Bhg Datuk Tiah, the ultimate beneficial owner of British Columbia Limited is deemed interested in the aforesaid agreements. YG BHG DATO SRI MOHAMED BIN ABID Executive Director Yg Bhg Dato Sri Mohamed Bin Abid, aged 66, a Malaysian, studied Business Management at The MARA Institute of Technology and was admitted as a Member of the British Institute of Management. He started his career as a Shipping Executive and later promoted to Manager in P & O Steam Navigation Co. Ltd, Singapore & London from year 1964 to year In year 1974, he joined MISC Coastal Services Sdn Bhd as Marketing Manager and later promoted to Director and General Manager until year Subsequently, he was appointed General Manager of MISC Agencies Sdn Bhd until year In year 1987, he was appointed as Managing Director of East & West Maritime Sdn Bhd. In year 1989, he established JB Distripark Sdn Bhd and held the position of Executive Director. He then joined the Board of TA Enterprise Berhad as Executive Director on 1 July He has extensive experience in the shipping industry and has held various senior positions, both locally and abroad. Over the years, his established network of local and international business contacts have been invaluable to the growth and development of the TA Group. In addition, he has also actively been involved in building the corporate as well as public image of the TA Group of Companies. He sits on the Boards of a number of companies within the TA Group. He is a member of the Company s Property Management Committee. He has attended six of the seven Board Meetings held during the financial year. He is deemed to have a vested interest in the joint venture between TA Properties Sdn Bhd and Beringin Terrace Sdn Bhd to develop all that piece of freehold land held under No. H.S. (D) 32163, PT 938 in the Mukim of Kuala Lumpur, Wilayah Persekutuan measuring approximately 12, square metres, by virtue of Section 122A of the Companies Act, 1965 as Yg Bhg Dato Sri Mohamed Bin Abid who is an Executive Director and shareholder of the Company and a Director of TA Properties Sdn Bhd, whereas his son Hafez Bin Mohamed is a Director and shareholder of Beringin Terrace Sdn Bhd. 22 TA Enterprise Berhad Annual Report 09

15 Directors Profile PUAN ZAINAB BINTI AHMAD Executive Director Puan Zainab Binti Ahmad, aged 57, a Malaysian, holds a Bachelor in Business Administration Degree from the ITM/ University of Ohio. She started her career in June 1983 with A.T. Securities Sdn Bhd as the General Manager. She then joined TA Securities Sdn Bhd as Director in December 1987 till October She was then appointed as Executive Director of TA Enterprise Berhad on 13 March She also sits on the Boards of TA Centre Berhad, a public company which is a whollyowned subsidiary of TA Enterprise Berhad and a number of companies within the TA Group. She is a member of the Company s Property Management Committee and Tender Committee. She has attended five of the seven Board Meetings held during the financial year. MR PETER U CHIN WEI Independent NonExecutive Director Mr Peter U Chin Wei, aged 58, a Malaysian is a Fellow of the Institute of Chartered Accountants in England and Wales. He joined the MUI Group as General Manager in year 1981 and held the position till year Thereafter, he sat on the Board of Pegi Malaysia Berhad as an Executive Director in year 1989 till year He then joined TA Enterprise Berhad as Executive Director in October 1990 till October Thereafter, he was appointed as an Independent NonExecutive Director of TA Enterprise Berhad in July He also sits on the Boards of Kumpulan Europlus Berhad, a public listed company and Asian Outreach (M) Berhad, a public company. He is the Chairman of the Company s Audit Committee, Nomination Committee and Remuneration Committee. He has attended five of the seven Board Meetings held during the financial year. MR JORY LEONG KAM WENG Independent NonExecutive Director Mr Jory Leong Kam Weng, aged 45, a Malaysian, holds a Bachelor of Economics Degree and a Bachelor of Laws Degree from Monash University, Australia. He is a Certified Public Accountant of CPA Australia and a Chartered Accountant of the Malaysian Institute of Accountants. He is also a certified mediator on the panel of the Malaysian Mediation Centre, Bar Council Malaysia. He was called to the Malaysian Bar in In February 1992, he joined TA Enterprise Berhad as the Group Legal Manager and served in that position until July He was the Vice President, International Division of TA Enterprise Berhad from November 1993 to October Between November 1995 to February 1997, he held the position of General Manager/Director of TA First Credit Sdn Bhd. He also held the post of Executive Director of TA Bank of Philippines, Inc from March 1997 to June 1998 and from June 1998 to July 1999, he was the Chief Executive Officer of TA Securities Berhad. Since July 1999, he has been a Partner of Messrs Iza Ng Yeoh & Kit as a practicing Advocate and Solicitor. He was appointed as Independent NonExecutive Director of TA Enterprise Berhad on 19 May He also sits on the Board of Asian Outreach (M) Sdn Bhd, a public company. He is a member of the Company s Audit Committee, Nomination Committee, Remuneration Committee and Corporate Governance Committee. He has attended all the seven Board Meetings held during the financial year. MR CHRISTOPHER KOH SWEE KIAT Independent NonExecutive Director Mr Christopher Koh Swee Kiat, aged 41, a Malaysian, graduated with a LL.B (Hons) from the University of Malaya and was called to the High Court of Malaya as an Advocate and Solicitor in March He also holds an ACCA postgraduate diploma in Accounting and Finance. He was the Head of Legal Affairs Department for TA Securities Berhad. He has negotiated and prepared the legal documentation for the various overseas ventures of the Company including a bank and stockbroking companies in over four countries. He was previously an inhouse counsel for MasterCard International in its Asia Pacific regional office in Singapore. Thereafter, in January 2005, he established Messrs Chris Koh & Chew, Advocates & Solicitor and on 24 May 2006, he was appointed to the Board of TA Enterprise Berhad as an Independent NonExecutive Director. He specialises in corporate, commercial and finance matters including merger and acquisitions, corporate restructuring, joint ventures, corporate finance, listing of companies and matters relating to industrial disputes. His scope of responsibilities include extending legal advice to the TA Group of Companies as well as to assist in the acquisition of TA Enterprise Berhad Annual Report 09 23

16 Directors Profile business interest on behalf of the TA Group. He is a member of the Company s Audit Committee, Remuneration Committee and Nomination Committee. He has attended all the seven Board Meetings held during the financial year. Being the Independent NonExecutive Director of the Company, Mr Christopher Koh declared his interest as a partner in Messrs Chris Koh & Chew, the solicitors involved in providing legal advice for the sale of TA Properties Sdn Bhd, Sanjung Padu (M) Sdn Bhd, Wales House Trust and Taman Duta Residences to TA Global Berhad. Messrs Chris Koh & Chew are also the solicitors appointed for the corporate exercise involving the Proposed Reorganisation, Proposed Listing of TA Global Berhad on the Main Board of Bursa Malaysia Securities Berhad, Proposed Capital Distribution and Proposed Amendments to the Memorandum and Articles of Association of the Company. PUAN RAHMAH BINTI MAHMOOD Independent NonExecutive Director Puan Rahmah Binti Mahmood, aged 51, a Malaysian, holds a double Bachelor of Science degree in both Marketing and Mass Communications from Syracuse University, New York. She also obtained a Master in Journalism (PR) from the University of Southern California (USC). Management Berhad, a public company which is 70% owned by TA Enterprise Berhad. She has over 25 years of experience in business management, contract negotiations and manufacturing practices. She also has assisted the Malaysian government in bringing in foreign investment into the country especially in the field of manufacturing. She has attended six of the seven Board Meetings held during the financial year. Notes : 1. Family Relationship of Directors Save as disclosed, none of the directors has any family relationship with any director and/major shareholder of the Company. 2. Conflict of Interest Save as disclosed, none of the Directors has any conflict of interest with the Company. 3. Conviction of Offence Save as disclosed, none of the Directors has been convicted of any offence in the past 10 years. 4. Interest in Securities The particulars of the Directors interest in securities of the Company are set out in page 135. She started her own automotive spares manufacturing company, Malaysian Automotive Lighting Sdn Bhd about 20 years ago in Penang with Robert Bosch Gmbh as the initial partners and later with Magnetti Mirelli of Italy. Malaysian Automotive Lighting Sdn Bhd is now a global manufacturing partnership with Automotive Lighting Reutlingen Gmbh, Germany, manufacturing automotive head lamps and rear lamps for companies such as Proton, Perodua, Suzuki, Mazda and other international car manufacturers and she is still currently the Director and shareholder of Malaysian Automotive Lighting Sdn Bhd. She is also the Chairman and Managing Director of Syarikat Mahmood Ambak & Sons Sdn Bhd since year 1988, a trading company supplying automotive spares to the Ministry of Defence of Malaysia and the Royal Police Force of Malaysia for the last 20 years. She has also diversified her business dealings into Independent Environmental Monitoring. She sits on the Board of Spanfield Sdn Bhd and Clearwater Towers Sdn Bhd, an environmental company. She joined TA Enterprise Berhad on 16 August 2007 as Independent NonExecutive Director, a position she holds todate. She also sits on the Board of TA Investment 24 TA Enterprise Berhad Annual Report 09

17 committed to excellence Heading 1 Notice is hereby given that the eighteenth annual general meeting of TA Enterprise Berhad will be held at the auditorium, 10th floor, menara ta one, 22 Jalan p. Ramlee, kuala lumpur on thursday, 19 june at A.M. For the following purposes 25 TA Enterprise Berhad Annual Report TA 09 Enterprise Berhad Annual Report 09 25

18 5Year Group Financial Summary YEAR ENDED 31 JANUARY (RM 000) (RM 000) 2007 (RM 000) 2006 (RM 000) 2005 (RM 000) OPERATING RESULTS Revenue Profit before tax ^ Profit after taxation ^ Profit attributable to equity holders of the parent ^ 535, ,470 92,280 91, , , , , , , , , ,756 89,504 80,708 80, , , , ,507 KEY BALANCE SHEET DATA Total assets Cash and cash equivalents* Total liabilities Total borrowings** Paid up share capital Shareholders equity 2,669, , , ,961 1,427,405 2,065,153 3,087, , , ,107 1,426,971 2,134,062 2,932, ,347 1,061, ,081 1,328,475 1,863,072 2,381, , , ,381 1,328,475 1,781,321 2,433, , , ,302 1,328,475 1,766,486 SHARE INFORMATION Per share (sen) Earnings (Basic) Earnings (Fully diluted) Net tangible assets ^^ Gross dividends Share price as at 31 January (RM) Market capitalisation () , ,797, ,169, , ,142,489 FINANCIAL RATIOS Return on total assets (%) Return on shareholders equity (%) Gearing ratio (times) Price to earnings ratio (times) 3.4% 4.5% % 10.5% % 7.1% % 4.5% % 6.1% * Comprises short term funds but excluding monies held in trust, Housing Development Accounts and pledged for bank guarantees. ** Secured foreign currency denominated term loan and short term borrowings. ^ ^^ Restated for FY 06 and 05 due to the change in accounting policy as described in 2007 Annual ReportNote 3.1 (e) Net tangible assets = total assets total liabilities intangible assets deferred tax assets + deferred tax liabilities. Restated for FY 07 on intangible assets. 26 TA Enterprise Berhad Annual Report 09

19 5Year Group Financial Summary REVENUE AND PROFIT AFTER TAX Revenue Profit after tax EARNINGS PER SHARE AND GROSS DIVIDENDS PER SHARE Earnings per share Gross dividends per share SHAREHOLDERS EQUITY, TOTAL ASSETS AND TOTAL LIABILITIES ,766 1,781 2,434 2,382 Shareholders' equity Total liabilities Total assets ,062 1,863 2, ,134 3, ,065 2, PROFIT AFTER TAX (attributable to equity holders of the parent) AND YEAREND SHARE PRICE RM Million Share price Profit after tax Financial Years TA Enterprise Berhad Annual Report 09 27

20 Segmental Analysis 0.00% (51) 13.13% (344,554) 2.25% (59,158) 0.10% (2,539) Malaysia 5.13% (27.469) 0.00% (16) 14.31% (76,631) Hong Kong 10.28% (269,746) Australia 2.27% (12,150) 3.35% (87,938) South Africa Canada 78.29% (419,160) 70.88% (1,859,906) British Virgin Islands Segment Assets RM ( 000) Others Revenue RM ( 000) 0.02% (711) 8.73% (264,298) 1.74% (52,751) 0.08% (2,455) Malaysia 4.82% (26,354) 0.81% (4,402) 15.03% (82.181) Hong Kong 11.01% (333,288) Australia 5.35% (29,232) 3.89% (117,621) South Africa Canada 74.00% (404,537) 74.52% (2,255,830) Segment Assets RM ( 000) British Virgin Islands Others Revenue RM ( 000) 1.17% (33,932) 7.97% (230,259) 1.63% (47,074) 0.04% (1,286) Malaysia 7.06% (25.027) 1.97% (6.988) 20.72% (73.471) Hong Kong 9.49% (274,306) Australia 3.17% (11,248) South Africa 2.18% (62,954) Canada 67.07% ( ) 77.52% (2,240,998) 2007 Segment Assets RM ( 000) British Virgin Islands Others 2007 Revenue RM ( 000) 28 TA Enterprise Berhad Annual Report 09

21 Segmental Analysis REVENUE, NET SEGMENT RESULTS AND NET SEGMENT ASSETS RM Million Stockbroking and financial services Investment holding Credit and lending Property investment Property development Hotel operations Others Net Segment Assets Net Segment Results Revenue REVENUE, NET SEGMENT RESULTS AND NET SEGMENT ASSETS RM Million Stockbroking and financial services Investment holding Credit and lending Property investment Property development Hotel operations Others Net Segment Assets Net Segment Results Revenue 2007 REVENUE, NET SEGMENT RESULTS AND NET SEGMENT ASSETS RM Million Stockbroking and financial services Investment holding Credit and lending Property investment Property development Hotel operations Net Segment Assets Net Segment Results Revenue TA Enterprise Berhad Annual Report 09 29

22 Statement on Corporate Governance Corporate Governance is the process and structure used to direct and manage the business and affairs of the Company towards enhancing business both prosperity and corporate accountability. Its ultimate objective is to realise the long term shareholders value whilst taking into account the interests of various stakeholders. The Board of Directors is committed in ensuring that The Principles and Best Practices of the Malaysian Code on Corporate Governance (the Code ) are observed and practised as a fundamental part of discharging its responsibilities to protect and enhance shareholders value. In preparing this report, the Board has considered the application of the principles of the Code and the extent of its compliance with the Best Practices of the Code. DIRECTORS A. Composition of the Board As at the date of this statement, the Board consists of eight (8) members; comprising an Executive Chairman, three (3) Executive Directors and four (4) Independent NonExecutive Directors. With half of the Board comprising of Independent Directors, it brings objective and independent judgement elements into the decision making process of the Board. The Board had examined its size and felt that its current Board size of 8 members comprising of the fifty percent Independent NonExecutive Directors is effective and appropriate. The Directors through their vast experiences and qualifications in economics, accounting, stockbroking, finance, legal, property development and business management provide effective contribution and support to the functions of the Board. They bring with them a broad range of skills, experiences and knowledge required to successfully direct and supervise the Group s business activities which are vital to its success. A brief profile of each Director is presented on pages 21 to 24 of this Annual Report. There is a clear division of responsibilities at the helm of the Group to ensure a balance of authority and power. The Executive Chairman, who is not previously a Chief Executive Officer is responsible in ensuring Board effectiveness in constructive deliberation of the corporate direction of the Group. The Executive Chairman also takes overall responsibility for the operational performance, organisational effectiveness and implementation of the Board s policies and decisions. Whereas the Managing Director & Chief Executive Officer is responsible for the daytoday operational management of the Group and its businesses. The executive powers of the Executive Chairman and the Managing Director & Chief Executive Officer is then balanced by the presence of Independent NonExecutive Directors who exercise their independent judgement on issues of strategy, standards of conduct, resources, processes and safeguarding of interests of minority shareholders. From an investor relation perspective, all queries and concerns of shareholders and public in general, are directed to our Independent NonExecutive Director, Mr Jory Leong Kam Weng. B. Board Responsibilities The Board has the overall responsibility for corporate governance, strategic direction and overseeing the investment and business of the Group. The Board maps out the Group s medium and long term strategies in addition to its responsibility to review the Management s action plans. The Board s other primary duties are to conduct regular review of the Group s business operations and performances and to ensure that effective controls and systems exist to measure and manage business risks. The number of Directors meetings and attendance for the financial year in review are as set out in Table 1.0 The Board has set up several Board Committees as well as Management Committees to assist the Board in discharging its duties and responsibilities. The functions and terms of reference of the Board Committees and Management Committees together with the authority delegated by the Board to these committees are clearly defined in their respective terms of reference. Board Committees include the Audit Committee, Nomination Committee and Remuneration Committee. Management Committees comprise of Option Committee, Stockbroking Management Committee, Property Management Committee, TA Investment Management Committee, Tender Committee, Group Investment Committee, Corporate Governance Committee, Tax Planning Committee, Information Technology Management Committee and Futures Management Committee. The Management Committees meet from time to time to discuss, deliberate, consider and submit proposals on issues 30 TA Enterprise Berhad Annual Report 09