DELIVERING WATER, DRIVING PERFORMANCE ANNUAL REPORT 2009

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1 DELIVERING WATER, DRIVING PERFORMANCE ANNUAL REPORT 2009

2 ABOUT THE COVER DELIVERING WATER, DRIVING PERFORMANCE As Malaysia s premier water company, Puncak Niaga is always at the forefront, delivering improvements and advancement throughout our operations in our drive to conduct business in a responsible and sustainable manner. With a clear and focused strategy, we are continuously engaged in the single minded pursuit of delivering service excellence, driving performance, delivering higher levels of customer satisfaction, ensuring sustainable returns for our shareholders and value creation for all stakeholders. OUR VISION To Be A Leading Regional Integrated Water, Wastewater And Environmental Solutions Provider And To Emerge As A Significant Player In The Oil & Gas Sector. OUR MISSION To meet the increasing challenges in the demand for high quality water supply, wastewater and environmental systems through the continuous implementation of high quality standards, efficient services, human capital development, innovative technologies and operational systems. To share our experience and offer our expertise through Smart Business Partnerships, Public Private Partnerships or other innovative business models. 13TH ANNUAL GENERAL MEETING DATE 23 June 2010 (Wednesday) TIME am VENUE Concorde 1 Concorde Hotel Shah Alam, Level 2 No. 3, Jalan Tengku Ampuan Zabedah C9/C Shah Alam Selangor Darul Ehsan To actively participate in local, regional and global business opportunities with linkages to the Company s core activities, waste water & solid waste management, environment management and oil & gas sectors. To actively support and participate in programmes and activities aimed at uplifting the community s living standards and value systems in line with the aspirations of Vision To address national and international concerns pertaining to the protection, conservation and enhancement of the natural environment we live in.

3 2009 KEY HIGHLIGHTS ANNUAL REPORT 2009 SUCCESSFULLY OPERATE AND MAINTAIN 29 WTPs WITH A COMBINED CAPACITY OF 1,930 MILLION LITRES PER DAY (MLD) DELIVERED MILLION CUBIC METRES OF TREATED WATER IN 2009, AN INCREASE OF 0.97% FROM 2008 SUCCESSFULLY MANAGED AND MAINTAINED 10% REDUCTION IN NON- REVENUE WATER LOSSES SINCE 2005 EFFECTIVELY REDUCED UP TO 593 MLD IN WATER WASTAGE ACHIEVED COLLECTION EFFICIENCY OF 99.1% IN 2009 AVERAGE PERCENTAGE OF CALLS SUCCESSFULLY ANSWERED IN 2009 WAS 98% SYABAS successfully distributed a daily average of 3,924 MLD of treated water to approximately 7.3 million consumers comprising domestic, commercial and industrial, the largest in the nation Achieved treated water quality compliance of 99.9% Successfully achieved a compliance rate of 93.8% for the customer response time for water quality complaints of 30 minutes PUNCAK NIAGA HOLDINGS BERHAD

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6 ANNUAL REPORT 2009 PUNCAK VALUES OUR COMPANY S VALUES, THE PUNCAK VALUES SHAPE OUR ORGANISATIONAL CULTURE AND GUIDE THE WAY WE RUN OUR BUSINESS. THEY ARE INTEGRATED INTO OUR BUSINESS PROCESSES AND OUR CORE VALUES. AT PUNCAK, WE ARE AND CONTINUOUSLY SEEK TO BE: PASSIONATE ABOUT OUR BUSINESS FOR SUSTAINABLE PERFORMANCE. UNITED AS ONE IN OUR CORPORATE RESPONSIBILITY STRATEGY TO ALIGN WITH OUR VISION TO BE THE LEADING REGIONAL INTEGRATED WATER, WASTEWATER AND ENVIRONMENTAL SOLUTIONS PROVIDER AND TO EMERGE AS A SIGNIFICANT PLAYER IN THE OIL & GAS SECTOR. NURTURE OUR HUMAN CAPITAL TOWARDS AN EXEMPLARY WORKFORCE. CORPORATE GOVERNANCE GUIDES THE WAY WE RUN OUR BUSINESS IN AN EVOLVING GLOBAL BUSINESS ENVIRONMENT. ACCOUNTABLE FOR ALL OUR ACTIONS AND ENGAGEMENT PROCESS WITH OUR STAKEHOLDERS. KNOWLEDGEABLE IN ALL ASPECTS OF OUR BUSINESS OPERATIONS AND CONTINUE TO BE THE TRUSTED AND RELIABLE PROVIDER OF CLEAN WATER SUPPLY. PUNCAK NIAGA HOLDINGS BERHAD

7 TABLE OF CONTENTS ANNUAL REPORT 2009 Executive Chairman s Message 002 About This Report 011 DELIVERING WATER, DRIVING PERFORMANCE Delivering Water, Driving Performance 014 Corporate Profile 018 Corporate Information 020 PNHB Fact Sheet 022 Corporate Achievements 024 Our Role In The Water Supply System 025 Corporate Structure 026 Organisation Structure PNSB 027 Organisation Structure SYABAS 028 Board Of Directors Profile 030 Board Of Directors 041 Key Personnel Profile PNSB 042 Key Personnel Profile SYABAS 045 Key Personnel Profile Sino Water Pte Ltd 051 Five-Year Financial Highlights 052 Five-Year Group Performance 053 Share Price & Volume Traded 054 Financial Calendar 055 Milestones 056 DRIVING PERFORMANCE Operations Review Puncak Niaga (M) Sdn Bhd 060 Syarikat Bekalan Air Selangor Sdn Bhd 066 Delivering Quality 077 EXPANDING OPPORTUNITIES Business Updates 084 DELIVERING SERVICE EXCELLENCE Improving Customer Service 090 Consumer Awareness And Education Programme 092 VALUING OUR PEOPLE Building Our People 096 Occupational Health & Safety 105 At The Marketplace 109 ENGAGEMENT WITH OUR COMMUNITY Our Corporate Social Responsibility 114 Corporate Events 120 PRESERVING OUR ENVIRONMENT Sustaining Our Environment 126 ACCOUNTABILITY Corporate Disclosure Policy 136 Statement On Corporate Governance 137 Statement On Internal Control 151 Audit Committee Report 153 Risk Management Policy & Report 160 Investor Relations Policy & Report 164 Quality Policy & Report 167 Health, Safety And Environmental Policy 168 SYABAS Corporate Responsibility Policy 169 Distribution Schedule Of Equity Securities 170 List Of Properties 174 Statement Of Directors Responsibility For Preparation Of Financial Statements 175 FINANCIAL STATEMENTS Financial Statements 177 Notice Of Annual General Meeting 313 Statement Accompanying The Notice Of Annual General Meeting 315 GRI Index 317 Proxy Form Corporate Directory PUNCAK NIAGA HOLDINGS BERHAD

8 EXECUTIVE CHAIRMAN S MESSAGE ANNUAL REPORT 2009 TO OUR DEAR VALUED SHAREHOLDERS AND STAKEHOLDERS, Puncak Niaga Holdings Berhad 2009 s performance demonstrated our focused strategy and effective business model to achieve sustainable growth despite the challenging economic, business and political environment. We had managed to exceed our Key Performance Indicators (KPIs) with diligence and intensified efforts besides contributions towards water resources and environmental conservation, through our innovative operational measures putting us on the right track as the leading and dynamic integrated water services company. We realize that the challenges in our pursuit of excellence in delivering clean safe affordable drinking water to every customer is paramount. Driven by our commitment, innovation and ability to listen to our customers, we will continue to strive to improve the level of customer satisfaction amidst deteriorating raw water quality and environmental issues, embodying the theme for our Annual Report 2009, Delivering Water, Driving Performance. PUNCAK NIAGA HOLDINGS BERHAD 002 YBHG TAN SRI ROZALI ISMAIL EXECUTIVE CHAIRMAN OF PNHB GROUP

9 ANNUAL REPORT 2009 THE ECONOMY IN 2009 The year 2009 saw intensified efforts being put in-place with countries around the globe speeding up the economic stimulus packages to spearhead recovery. The global economy was in recession throughout the year, where the value of world trade reached its lowest point in March 2009, representing a 21 percent decline from the previous year. However, by the second quarter of 2009, commodities prices including oil and food stabilised followed by positive development in the world s leading economy; the USA coupled with China, India and other developing countries and the world trade recovered with moderate growth (Source: World Bank 2010-Global Economic Prospects 2010) also saw a worldwide H1N1 flu pandemic, with thousands of deaths reported in North America and European countries resulting in wide scale impacts on travel, trade, tourism, health system, food supply, consumption and eventually, foreign investments in many countries and financial markets (Source: Bank Negara Malaysia-Bulletin for Second Quarter 2009). A HEALTHY PERSON CAN DRINK ABOUT THREE GALLONS OF WATER DAILY We were fortunate that Malaysia was able to withstand these challenges, thanks to our Government s sound fiscal and economic policies, as well as the proactive measures in curbing the H1N1 pandemic. Our Government s efforts were well appreciated not only locally, but also globally when the International Monetary Fund ( IMF ) acknowledged that Malaysia s fiscal and economic policies were key to its success in weathering the economic crisis, past and present. Backed by the concept of 1Malaysia People First, Performance Now mooted by our Honourable Prime Minister, YAB Dato Sri Mohd Najib Tun Haji Abdul Razak in April 2009, Malaysia is set to achieve the developed nation status by Against this backdrop, on behalf of the Board of Directors of Puncak Niaga Holdings Berhad, I am therefore pleased to present the Annual Report and Audited Financial Statements of the Group and Company for the financial year ended 31 December CORPORATE RESPONSIBILITY AND ENVIRONMENTAL RESPONSIBILITY Puncak Niaga Holdings Berhad Group ( the Group or PNHB Group ) has always played an integral part in Corporate Responsibility (CR) initiatives as we recognise the importance of achieving commercial success in ways that honour ethical values as well as respecting our stakeholders and caring for the environment, which is in line with our CR s tagline Nurturing Relationship. Among the ongoing CR programmes that were successfully conducted by the Group are Education and Awareness Campaign; Water Saving Advocacy; Educational Outreach Programme; and Stakeholders Engagement Programme. Global efforts on greening the environment was also intensified with the Government s commitment for Malaysia to reduce its carbon emission to 40% by the year 2020 wherein the National Green Technology Policy takes cognizance of the need for better and more efficient use of technology for sustainable development and green technology best practices. Our Government has also earmarked Green Technology as a new driver for Malaysia s economic growth as it offers enormous opportunities and immense potential in economic regeneration, innovation and wealth creation. PUNCAK NIAGA HOLDINGS BERHAD 003

10 EXECUTIVE CHAIRMAN S MESSAGE ANNUAL REPORT 2009 At the corporate level, conservation and preservation of the natural environment is viewed very seriously by the Group as part of our Corporate Environmental Responsibility. We have on our own accord, since 1995, established a Water Resources and Environmental Surveillance (WRES) Department (now known as Water Quality & Research Section) to provide environmental monitoring and surveillance of the water catchment areas including the rivers, lakes and dams against any potential pollution sources and activities such as discharge of untreated waste into the raw water resources, solid waste dumping, oil spillages, illegal sand mining, unregulated land clearing and animal husbandry activities. Environmental Programmes such as our Factory Visit Programme seeks to raise awareness amongst factory operators on proper management of waste disposal into the natural environment, educating the children on the importance to conserve and preserve the natural environment via our River Rescue Brigade (Briged Penyelamat Sungai) and Educational Outreach Programme (Program Turun Ke Padang) initiatives; and close liaisons with the relevant regulatory authorities to mitigate pollution incidences, were initiated and implemented by the Group as part of the Group s efforts to promote an awareness on the importance of conservation, preservation and enhancement of our natural environment for the future generations. We will continue with our efforts to help promote the awareness on conserving and preserving the natural environment to ensure the success of the Government s Green Technology Policy. FINANCIAL PERFORMANCE For the financial year ended 31 December 2009, the Group reported a 33.3% increase in revenue to RM1, million from RM1,415.0 million in The increase in revenue was due to higher water revenue contributed from the growth in the number of consumer accounts and water consumption and the water tariff compensation receivable from the Selangor State Government for the first, second, third and fourth quarters of 2009 as provided under the terms of the Concession Agreement dated 15 December 2004 signed between SYABAS, the Federal Government and the State Government of Selangor Darul Ehsan ( Concession Agreement ). The amount of water tariff compensation is based on SYABAS Management s best estimate of the water tariff compensation as provided under the terms of the Concession Agreement. The water tariff compensation for the first, second and third quarters of 2009 had been submitted to the Selangor State Government. The profit before taxation for the financial year ended 31 December 2009 increased by RM257.7 million to RM312.6 million compared with RM54.9 million in The increase was principally due to higher water revenue as explained above. The higher finance costs were mainly attributed to the full impact of the drawdown of the Bai Bithaman Ajil Medium Term Notes (BAMTN) by SYABAS in October 2008 to fund its operating cash flow deficit. The increase in depreciation and amortisation was due to higher water revenue. PUNCAK NIAGA HOLDINGS BERHAD 004

11 ANNUAL REPORT 2009 The Group s Shareholders Funds stood at RM1,473.8 million (2008: RM1,372.6 million) and Earnings Per Share (EPS) was sen compared to 5.29 sen in 2008, up by sen (558%). For yet another consistent performance of the Group for the financial year ended 31 December 2009, the Board of Directors is pleased to propose a final single tier dividend of 10 sen per share for the financial year ended 31 December 2009 (2008: single tier dividend of 10 sen per share). CORPORATE DEVELOPMENTS On 30 March 2009, SYABAS issued RM213.8 million of Redeemable Cumulative Preference Shares ( RPS ) of RM0.01 each at an issue price of RM1.00 per RPS (a premium of RM0.99 per RPS) to the Minister of Finance, Incorporated (MOF). As at 31 December 2009, the RPS stood at RM523.4 million. THE EARTH CONTAINS APPROXIMATELY 326 MILLION CUBIC MILES OF WATER On 20 November 2009, PNSB carried out the third mandatory partial redemption of RM54,687, nominal value of the outstanding RM437,500, nominal value of 15-Year Redeemable Unconvertible Junior Notes (JNA) from PNHB. Concurrently, PNHB utilised the proceeds from the redemption of the JNA to undertake a third mandatory partial redemption of RM54,687, nominal value of the outstanding RM437,500, nominal value of the 15-Year Redeemable Unconvertible Junior Notes (RUN) from PNHB s RUN holders. On 16 December 2009, SYABAS entered into a Loan Agreement with the Government of Malaysia in respect of a loan facility of RM320.8 million granted to SYABAS. In December 2009, SYABAS BA Commercial Papers/BAMTN was affirmed the MARC-1ID/AA-ID rating and more recently, in January 2010, Malaysian Rating Corporation Berhad (MARC) affirmed the A+ long term ratings of PNHB s RUN, PNSB s JNA and RM435,000, Nominal Value 10-Year Redeemable Unsecured Bonds (RUBs) and the AAID rating for PNSB s RM1,020,000, Year Al-Bai Bithaman Ajil Islamic Debt Securities Primary Bonds Together With Non-Detachable Secondary Bonds (BAIDs). EFFECTIVE GOVERNANCE The Group upholds the core values of corporate governance, integrity, transparency and accountability in the conduct of its business operations. As Malaysia s leading water services company, we believe that the principles of good corporate governance are integral to the Group s continued growth and ability to promote the confidence of our stakeholders. BUILDING BETTER RELATIONSHIPS Being an essential utility services provider, we are constantly under the scrutiny of the public and authorities, which makes us more determined to outperform our obligations with each turn of the year. Through the Group s efforts and intiatives in ensuring the highest standards of efficient operational performance in terms of water treatment and distribution to consumers in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya, we have successfully gained the trust and confidence of the public in managing the water distribution responsibility via our 70% owned subsidiary, SYABAS, which we helmed since January PUNCAK NIAGA HOLDINGS BERHAD 005

12 EXECUTIVE CHAIRMAN S MESSAGE ANNUAL REPORT 2009 PUSPEL, SYABAS award winning 24-hour Customer Contact Centre, continues to provide 24/7 service to enable the public and our customers to channel their problems, queries and sharings in relation to water supplies. We have a Code of Conduct and strict targets for our counter staff to ensure the consistency of their counter services in terms of courtesy, manners and calls handling time to ensure total customer satisfaction. The Industrial Customer Unit (ICU) supports the industrial and commercial sectors whilst Unit Kerjasama Informasi Pelanggan (YAKIN) maintains constant and close liaisons with representatives of the domestic consumers in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya via the community leaders, Jawatankuasa Keselamatan Kampung, residents associations, etc. STAYING ON COURSE We remain focused in ensuring the continuity of clean treated water supplies for our customers and delivering shareholder value and benefits to all our stakeholders. We are committed to ensure sustainability of our operations, taking into account the various challenges which we have to face in light of climate change, global warming, environmental pollutions, the delay in the proposed restructuring of the water services industry in Selangor ( proposed restructuring ) and the decision by the authorities to freeze the capital expenditure (CAPEX) in rehabilitation and upgrading of the water supply facilities. We continue to implement tight controls on costs and pursue measures in our continuous efforts in improving our operational performance. We seek to improve constantly through embracing technological upgrades, research and development, strategic partnerships, collaborations with international and local universities and corporations to enhance our ability to work more effectively and efficiently to remain on course as a leading and dynamic integrated water services company. In year 2009, we made good progress despite the many hurdles that we faced in light of a difficult year, for example: 1) For preventive and scheduled maintenance, PNSB uses two (2) systems to track the maintenance schedules namely, Maximo for Sungai Selangor Phase 2 (SSP2) Water Treatment Plant (WTP) and MaintPro System for the remaining WTPs. 2) For delivery of good quality of treated water, continuous filter performance monitoring is conducted at our WTPs and revision of the Standard Operating Procedures will be carried out on need basis. 3) For compliances with the National Drinking Water Quality Standards, PNSB undergo five (5) levels of water quality monitoring. PUNCAK NIAGA HOLDINGS BERHAD 006

13 ANNUAL REPORT ) For further optimization of the coagulation process, the use of streaming current detectors at three (3) of our WTPs was introduced. 5) For improvement in reliability and quality of the water supplied, PNSB is exploring the use of advance treatment technologies for our WTPs such as membrane technology. Two (2) of our WTPs, Kepong WTP and Sg Rumput WTP had been upgraded with Ultra Filtration Membrane Technology Water Treatment Plant. 6) For safeguarding the quality of the treated water supply, PNSB also uses river water surveillance system at the intake of five (5) WTPs identified to be prone to raw water pollution. 7) SYABAS distributed a daily average of 3,924 MLD of treated water (which is 1.5% above the 2008 amount) to approximately 7.3 million consumers (domestic, factories, commercial and industrial use) in Selangor, Federal Territories of Kuala Lumpur and Putrajaya, all under a tight financial constraint. WITHOUT FOOD A PERSON CAN LIVE FOR WEEKS, BUT WITHOUT WATER YOU CAN ONLY LIVE A FEW DAYS 8) PNSB s success in obtaining the Integrated Management System (IMS) Certification in 2008 for the Provision of Construction Services for Building, Civil Engineering Works, Mechanical and Electrical Engineering Works, Specialising in Water Related Infrastructure, certified by URS Certification (M) Sdn Bhd (URS) and accredited under the United Kingdom Accredited Service (UKAS) (in the areas of quality, safety and health and environmental management), the MS ISO/IEC for laboratory testing and the Japanese 5S for housekeeping, had enhanced our status and recognition internationally in the areas of quality, safety and health and environmental management. For the first time, we will endeavour to quantify our carbon emissions in respect of our activities arising from our electricity consumption. STANDARD BEARER OF EXCELLENCE In 2009, the Group continued to garner various awards and accolades which are testament of the Group s leadership position as the standard bearer of excellence in the water industry and corporate world. On 25 March 2009, SYABAS was awarded with the HR Excellence Category (Bronze Award) in the Malaysia HR Awards , which were followed by two (2) Silver Awards for Water INNO Awards 2009 by Malaysia Water Association for the Innovation In Information Technology, Computer Software In Training Category and for the Innovation In Solution Technology In Water Management on 19 May On 7 August 2009, SYABAS Kuala Lumpur District Office, Petaling District Office, Hulu Langat District Office, Sabak Bernam District Office and Kuala Langat District Office were awarded with Malaysian Society For Occupational Safety And Health (MSOSH) OSH Silver Award 2008 for Utilities Sectors Category. PUNCAK NIAGA HOLDINGS BERHAD 007

14 EXECUTIVE CHAIRMAN S MESSAGE ANNUAL REPORT 2009 SYABAS has also been acknowledged as the leading operator in terms of water quality in compliance with the Ministry of Health s Drinking Water Quality Standards by the National Audit Department ( Jabatan Audit Negara ) in the Auditor General s 2008 Report which was released on 19 October On 13 August 2009, PNHB was announced the Winner for Integrated Reporting in an Annual Report for the ACCA Malaysia Sustainability Reporting Awards (MaSRA) 2009 and on 1 December 2009, the Company obtained the Certificate of Merit for the National Annual Corporate Report Awards (NACRA) 2009 for excellence in annual reporting. Recently, PNHB was a repeat finalist for the second consecutive year for the StarBiz-ICR Malaysia Corporate Responsibility Awards 2009 for Market Capitalisation of RM1 Billion and Above Category on 5 March On 13 April 2010, the winning teams of SYABAS Innovative & Creative Circle, namely Falcon from SYABAS Kuala Selangor District Office and Smart from SYABAS Sabak Bernam District Office garnered the Gold Awards in conjunction with the Innovative & Creative Circle Central Region Mini Convention 2010 organised by Malaysian Productivity Corporation. WATER INDUSTRY OUTLOOK Budget 2010 saw the Government s allocation of RM9.0 billion to finance infrastructure projects, out of which 29% or RM2.6 billion has been allocated for water supply and sewerage services (Source: BERNAMA-Budget 2010). In line with Malaysia s economic expansion over the past decades, population growth and the increasing per capita income, ensuring a continuous supply of safe, affordable and clean treated drinking water, is now a basic necessity as our nation progresses to a developed country status. Demand for treated water in the Klang Valley which comprises Selangor, Kuala Lumpur and Putrajaya has been on an uptrend from 127 MLD in 1960 to 3,889 MLD in With the present production capacity and growing demand, the Klang Valley is projected to face water supply shortage as early as The Federal Government has enacted the Water Services Industry Act, 2006 (WSIA) and also the Suruhanjaya Perkhidmatan Air Negara (SPAN) Act which became effective since 1 January This is a new milestone for the water industry which saw the Federal Government s determination to streamline the regulation to better manage the water supply and sewerage services in the country. In association with this development, Pengurusan Aset Air Berhad (PAAB) or Water Asset Management Company was established on 5 May 2006 as a wholly owned company under the Minister of Finance, Incorporated pursuant to the WSIA. The establishment of PAAB forms part of the Federal Government s efforts to finance the water and sewerage assets in order to achieve a cheaper and long term financing, which is expected to translate ultimately to lower water tariff to the consumers. PUNCAK NIAGA HOLDINGS BERHAD 008

15 ANNUAL REPORT 2009 As at to date, the proposed restructuring or the migration to the new licensing regime are still pending since two offers from the Selangor State Government to the water players in Selangor lapsed without any headway made and the Federal Government had now stepped in to find a resolution to the matter at hand. As a result of the delay in the impending proposed restructuring, the ability of SYABAS to perform at its optimum level was affected due to cash flow deficits following the delay in the gazettement of the scheduled water tariff with no compensation received and the freeze of CAPEX projects by the authorities pending the resolution of the proposed restructuring. Nevertheless, we have risen to the occasion and ensured to the best of our ability that SYABAS interests are protected vis-à-vis the terms of its Concession Agreement. WATER HELPS TO MAINTAIN A HEALTHY BODY WEIGHT We will definitely consider our shareholders and stakeholders interests; including the consumers, when making the decision in relation to either the impending proposed restructuring of the water services industry in Selangor or the migration to the new licensing regime under WSIA. GAINING THE MOMENTUM 2010 will be yet another challenging year for us. We will continue with our existing water treatment and water distribution operations as usual and concurrently, we will pursue our business development efforts to secure new water and water related projects in other states within Malaysia and overseas, including sourcing for new opportunities in new sectors to increase our shareholders values in line with our new Vision To Be A Leading Regional Integrated Water, Wastewater And Environmental Solutions Provider And To Emerge As A Significant Player In The Oil And Gas Sector. On our expansion into China via our 80% owned subsidiary incorporated in Singapore, Sino Water Pte Ltd (Sino Water) in May 2008, we currently have five (5) subsidiaries incorporated in the People s Republic of China with principal businesses in the water and wastewater business. Phase One of Lushan Water Supply Project under our subsidiary, Luwei (Pingdingshan) Water Co Ltd with the 30 MLD WTP (complete with 40 km pipelines) is expected to be completed and commissioned by the fourth quarter of The Wastewater Treatment Plant under Binzhou Wastewater Project by Xinnuo Water (Binzhou) Co Ltd has commenced in October 2009 and the Wastewater Treatment Plant is expected to be completed and commissioned by the fourth quarter of Sino Water had on 31 December 2009 entered into an Industrial Water Supply Project Concession Agreement with the Water Bureau of Yuanshi County ( Yuanshi Water Bureau ) in Yuanshi, Shijiazhuang City, Hebei Province, China whereby the Yuanshi Water Bureau had granted Sino Water the exclusive right, within the Term of the Concession and Territory of the Concession, to invest, finance, design, construct, operate and maintain the Yuanshi Industrial Water Supply Project under a joint venture company, Hebei Sino Panlong Industrial Water Supply Co Ltd. PUNCAK NIAGA HOLDINGS BERHAD 009

16 EXECUTIVE CHAIRMAN S MESSAGE ANNUAL REPORT 2009 Sino Water s 80% owned China subsidiary, Luancheng Dayu Water Co Ltd is undertaking the Luancheng Dayu Water Supply Project. The relevant formalities and processes are ongoing to enable Luancheng Dayu Water Co Ltd to take over the said Project. In India, PNHB and Lanco Infratech Limited continued to operate and maintain the Chennai Water Supply Augmentation Project 1 - Package III (Chennai Project) which was completed in The Operation & Maintenance (O & M) service contract is still ongoing and has recently been extended to 31 May In Pakistan, PNSB is still undertaking feasibility studies under the auspices of the Asian Development Bank (ADB) to address the need for long term system planning for a sustainable and safe water supply system and an effective sewage treatment network for the Karachi Water and Sewerage Board. This collaboration is implemented and financed by ADB as a South Asian Water Utilities Network activity as part of the Water Operators Partnerships Programme. ACKNOWLEDGING EFFORTS I believe a committed and motivated workforce is central to delivering our objectives to meet our Vision and KPIs. On behalf of the Board, I would like to express our deepest appreciation to the Management and staff for their continued dedication, commitment, loyalty and contributions to the success and growth of the Group, and to my fellow Board Members, I wish to put on record my sincere gratitude and appreciation for your support, vision, expertise and co-operation with sound counsel and strategies for the Group. To my former Board Members, namely YBhg Dato Matlasa Bin Hitam and Mr Tan Seng Lee, I wish to put on record my thanks and appreciation for their past services and contributions to the Company and concurrently, I would like to welcome YBhg Dato Hashim Bin Mahfar and Mr Ng Wah Tar on Board. Our sincere thanks to the Federal Government and the Selangor State Government as well as the various governmental authorities, agencies and non-governmental organisations for the guidance and support provided. To our shareholders, a big thank you, for PNHB Group s success is a result of your continuous commitment, loyalty and support. We look forward to your continued support in 2010 and the years ahead. PNHB Group is poised to meet the challenges in 2010 and the Group will continue to meet its obligations to be a reliable provider of quality, clean and safe drinking water and to source for new businesses whilst at the same time, endeavour to meet our corporate environmental responsibility in promoting awareness on preservation, conservation and enhancement of our natural environment. TAN SRI ROZALI ISMAIL EXECUTIVE CHAIRMAN 26 April 2010 PUNCAK NIAGA HOLDINGS BERHAD 010

17 ABOUT THIS REPORT ANNUAL REPORT 2009 This integrated 2009 Annual Report (PNHB s Annual Report) aims to provide stakeholders with a complete and balanced picture of Puncak Niaga Holdings Berhad s (PNHB) overall performance in the areas of financials and business sustainability in PNHB s Annual Report is structured based on issues, allowing easy access to the information stakeholders find most relevant and enabling us to provide a complete overview of the issues we face. This PNHB s Annual Report adds comparability to our published PNHB s Annual Report At PNHB, we strive for continuous improvement in our growth, strategy and our sustainability performance. For the first time, we are applying the Global Reporting Initiative (GRI) G3 indicators into our report format as well as meeting other regulatory requirements in preparing PNHB s Annual Report. In this report, we have included disclosures on management approach, covering performance indicators up to Level C (minimum 10 performance indicators) of the GRI requirement. For more detailed information on our application level of the G3 guidelines, please refer to pages 317 to 319 of this Annual Report and the GRI Index. CAUTIONARY STATEMENT PNHB s Annual Report contains certain forward-looking statements with respect to the operations, performance and financial condition of the Group. By their nature, these statements involve uncertainty since future events and circumstances can cause results and developments to differ materially from those anticipated. The forward-looking statements reflect knowledge and information available at the date of preparation of PNHB s Annual Report and the Company undertakes no obligation to update these forward-looking statements. Nothing in PNHB s Annual Report should be construed as a profit forecast. Certain regulatory performance data contained in PNHB s Annual Report is subject to regulatory audit. Applicable Period and Date of Publication Applicable Period: Fiscal year 2009 (1 January to 31 December 2009) Date of Publication: 1 June 2010 MATERIALITY To help us decide on which issues to report, and with what level of detail, we carried out a materiality assessment, looking at the relative importance to our business, our stakeholders and the outside world, the impact an organisation has on its stakeholders and the wider social systems in which it operates. Our stakeholders include employees, customers, shareholders, suppliers and the wider local community. To achieve sustainable development, organisations need to balance social, environmental and economic priorities to ensure that whilst maintaining economic stability, the environment is protected and society is enhanced. PUNCAK NIAGA HOLDINGS BERHAD 011

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19 DELIVERING WATER, DRIVING PERFORMANCE We deliver unrivalled, high-quality and affordable services to our customers. We constantly benchmark our performance against international standards and industry best practices. OPERATES, MANAGES AND MAINTAINS 29 WATER TREATMENT PLANTS WITH A COMBINED CAPACITY OF 1,930MLD

20 DELIVERING WATER, DRIVING PERFORMANCE ANNUAL REPORT 2009 The Klang Valley has always been one of the high growth areas in Malaysia, both in terms of population and economic growth and together with Selangor, Kuala Lumpur and Putrajaya, it is the core areas in which Puncak Niaga Holdings Berhad (PNHB) Group operates. The successful delivery of our business strategies is reliant on our ability to foresee, adapt and manage changes as well as to better understand the needs and expectations of our consumers. The achievement of the above is within the ambit of strict compliances with the legal and regulatory framework applicable to our Group and business. PUNCAK NIAGA HOLDINGS BERHAD 014

21 ANNUAL REPORT Gombak WTP in operation 02 Having clean, drinkable water is essential to every human being OUR BUSINESS OPERATIONS We abstract raw water mainly from the rivers regulated by storage dams and treats the river water at the water treatment plants managed by Puncak Niaga (M) Sdn Bhd (PNSB). Since most of our water sources are polluted, we have to use advanced and costly water treatment technologies to ensure production of high quality treated water that is safe for human consumption, before we can deliver the treated water to our consumers through the water supply distribution network managed by Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS). Heat from the sun evaporates the water which forms clouds 1 Rain falls from the clouds 2 3 Water is collected and stored in reservoirs or taken from rivers or boreholes 4 Water is treated at water treatment plants OF THE 1,200 SPECIES LISTED AS THREATENED OR ENDANGERED, 50% DEPEND ON RIVERS AND STREAMS Treated wastewater is put back into the river and sea Clean water is stored in covered reservoirs Clean water is delivered to homes and factories through a network of pipes Wastewater is treated at wastewater treatment plants 8 7 Wastewater is taken away for treatment through the sewer network Water Cycle Our business operations require significant investment and since PNSB commenced operations in 1994 till to date, it had invested approximately RM2.2 billion in upgrading the existing infrastructure as well as developing new infrastructure. Since its establishment on 7 January 1997, PNHB which was subsequently listed on the Main Market of Bursa Malaysia Securities Berhad (Bursa Securities) (previously known as Main Board of Bursa Securities) on 8 July 1997, had grown to be the leading regional integrated water, wastewater and environmental solutions provider in Malaysia. Apart from being in the water business, we are also involved in research and development for the technological advancement of the water and wastewater industries, including sustaining the environment. We also provide our expertise in the development of offshore and onshore water treatment facilities for the oil and gas industry. Our services encompass the operation, maintenance, management, construction, rehabilitation and refurbishment of water treatment facilities and managing water distribution and customer services. PUNCAK NIAGA HOLDINGS BERHAD 015

22 DELIVERING WATER, DRIVING PERFORMANCE ANNUAL REPORT Aeration system at Gombak WTP 02 Inspection at Wangsa Maju WTP PNSB PNSB, the holder of four water treatment concessions with the Selangor State Government, operates, manages and maintains 29 water treatment plants (WTPs) with a combined capacity of 1,930 million litres per day. Besides that, PNSB also hold one concession to operate three dams in Selangor namely, Tasik Subang Dam, Klang Gates Dam and Sg Langat Dam. SYABAS Under a separate concession agreement with the Federal Government and the Selangor State Government, Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS) manages the supply of treated water to a population of 7.3 million and industrial and commercial consumers, with a total of million consumer accounts. SYABAS also undertakes the maintenance of 24,893 km of water pipes, 1,240 service reservoirs, elevated water tanks and suction tanks and 451 pumping stations within the Selangor State and the Federal Territories of Kuala Lumpur and Putrajaya. PUSPEL Our customer service department widely known as PUSPEL contains a state-of-the-art customer contact centre which is manned by SYABAS highly trained call agents, operating 24 hours daily the whole year round and providing customers with a convenient and effective way to contact SYABAS on all water supply matters. In 2009, PUSPEL received 567,970 calls and managed a total of 204,430 cases successfully with an average handling time of 2 minutes 50 seconds against the KPI of 3 minutes 30 seconds. The remaining calls were either repeat calls, calls on same issues or complaints lodged earlier by other consumers, general enquiries on payments and billings, reporting pipe bursts and pipe leaks, seeking for direction to SYABAS District Offices, requests for the phone numbers of SYABAS District Offices, checking on account status, etc. Manpower Out of the total manpower strength of 4,037 employees in PNHB Group as at 31 December 2009, more than half comprise Management, professionals, and technical and supervisory executives with core competencies in engineering, accountancy, legal, management, administration and customer service; which are instrumental in supporting the Group s business and operations. PUNCAK NIAGA HOLDINGS BERHAD 016

23 ANNUAL REPORT Water calibration monitoring in the laboratory 04 SYABAS Chief Executive Officer in action to resolve the Kampung Revolusi Hijau pipe burst incident Achievement Since the privatisation of the water supply distribution undertaken by SYABAS in 2005: Water quality supplied in Selangor, Federal Territories of Kuala Lumpur and Putrajaya has improved significantly and the water quality violation rates recorded are 1.5% to 8.5% better than the standards set by the Ministry of Health under their Quality Assurance Programme for key parameters and zero violations recorded on microbiological parameters. Non-revenue water losses from the water supply distribution network has reduced by more than 10%, as a result of strategic programmes including capital expenditure works to replace ageing water pipes, some of which are between 30 to 50 years old. OUR OTHER BUSINESS VENTURES In 2008, PNHB Group entered the China market via its 80% owned subsidiary, Sino Water Pte Ltd (Sino Water), a private limited company incorporated in Singapore to undertake potable water and wastewater projects in several provinces in China such as Lushan Water Supply Project, Binzhou Wastewater Project, Yuanshi Industrial Water Supply Project and Luancheng Dayu Water Supply Project. Sino Water has established various subsidiaries in China to undertake these projects. APPROXIMATELY ONE IN EIGHT PEOPLE ON THE EARTH OR 884 MILLION PEOPLE LACK ACCESS TO SAFE WATER SUPPLY In India, PNHB together with Lanco Infratech Limited via a joint venture namely, PNHB-LANCO-KHEC Joint Venture ( Joint Venture ) continued to operate and maintain the Chennai Water Supply Augmentation Project 1 ( Chennai Project ) Package III. The Joint Venture had completed the construction work in The Operation & Maintenance (O&M) service contract will end on 31 May 2010 and the Joint Venture is looking at the possibility of further extension. PNHB is looking at participating in viable international competitive tenders in India. The RM330 million Telibong and Telipok projects included the construction of the WTP, intake, off river storage, two reservoirs and pipe laying. Phase 1 of the Telibong Water Supply Scheme was completed on 31 October 2008 and was handed over to Jabatan Air Sabah on 1 November Jabatan Air Sabah had issued the Certificate of Practical Completion (CPC) on 3 November 2008 and the Defects Liability Period (DLP) in respect of the aforesaid works which began on 1 November 2008 will end on 31 October Two subsidiaries within the Group, namely Puncak Research Centre Sdn Bhd and Puncak Oil & Gas Sdn Bhd undertake research and development activities and oil and gas works respectively. PUNCAK NIAGA HOLDINGS BERHAD 017

24 CORPORATE PROFILE ANNUAL REPORT 2009 OUR COMPANY The Puncak Niaga Holdings Berhad (PNHB) Group is the leading regional integrated water, wastewater and environmental solutions provider and to emerge as a significant player in the oil & gas sector. PNHB is an investment holding company, whilst its subsidiaries are principally involved in the operation, maintenance, management, construction, rehabilitation and refurbishment of water treatment facilities; the supply and distribution of treated water within the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya; undertaking research and development and technology development for the water, wastewater and environment sectors as well as undertaking works related to the oil and gas industry and other materials and the provision of offshore and onshore engineering works. Established on 7 January 1997, PNHB was listed on the Main Board of Bursa Malaysia Securities Berhad (now known as the Main Market of Bursa Malaysia Securities Berhad effective 3 August 2009) on 8 July As at the end of December 2009, PNHB s market capitalisation stood at RM1.2 billion. It is the first water treatment and supply concession company to be listed on Bursa Malaysia Securities Berhad under the Infrastructure Project Company guidelines issued by Securities Commission. OUR CORE BUSINESS AND CAPABILITIES Our subsidiary, Puncak Niaga (M) Sdn Bhd (PNSB) which holds four water treatment concessions with the Selangor State Government, is the nation s second largest water supply concessionaire, operating, managing and maintaining 29 water treatment plants with a combined capacity of 1,930 million litres per day. PNSB undertook the finance, design, construction, operation, management and maintenance of the Sungai Selangor Phase 2 Water Treatment Plant with a design capacity of 950 million litres per day at a cost of RM1.28 billion which was completed on 1 January 2001, one year ahead of schedule. Subsequently, PNSB completed the Wangsa Maju Water Treatment Plant with a design capacity of 45 million litres per day at a cost of RM122.0 million in a record time of six months in July 1998, during the water crisis. These early completion of projects clearly exemplifies the PNHB Group s excellent capabilities in managing and undertaking large-scale water supply projects in Malaysia. Under a separate concession agreement with the Federal Government and the Selangor State Government, our other subsidiary, Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS), supplies treated water to a population of 7.3 million including industrial and commercial users, with a total registration of million consumer accounts. SYABAS also undertakes the maintenance of 24,893 km of water pipes, 1,240 service reservoirs, elevated water tanks and suction tanks and 451 booster pumping stations within the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya. PUNCAK NIAGA HOLDINGS BERHAD 018

25 ANNUAL REPORT 2009 In mid 2008, PNHB Group entered the China market via its 80% owned subsidiary, Sino Water Pte Ltd (Sino Water), a company incorporated in Singapore which focuses primarily on potential markets in China. Sino Water has established various subsidiaries in the People s Republic of China to undertake potable water and wastewater projects in several provinces in China. Two subsidiaries within the Group, namely Puncak Research Centre Sdn Bhd and Puncak Oil & Gas Sdn Bhd undertake the research and development activities and oil and gas works respectively. Our customer contact centre, PUSPEL, which is manned by a team of highly trained call agents, operates 24 hours daily and provides customers with a convenient and effective way to contact SYABAS on water supply matters. In May 2007, PUSPEL received the 2007 Malaysia Water Award for Excellence in Customer Service Management from the Malaysian Water Association. Out of the manpower strength of more than 4,000 employees in PNHB Group, more than half comprise Management, professionals, technical and supervisory executives with core competencies in engineering, accountancy, legal, management, administration and business; which are instrumental in supporting the Group s business and operations. OUR COMMITMENT TO CORPORATE CITIZENSHIP The PNHB Group is committed to upholding the principles of good corporate governance and core values such as quality, value, service, innovation and trust in the conduct of our business which are integral to our success over the years. We have received various repeat awards and accolades for good governance, annual reporting, occupational safety and health; and environmental and social reporting. In line with our corporate vision and mission, we seek to be environmentally responsible in the protection, conservation and enhancement of the natural environment, particularly in the management aspect of the water resources, which is relevant to our business operations. Our River Rescue Brigade (Briged Penyelamat Sungai) programme, that was initiated by our Executive Chairman in 1998 is a programme which aims to educate the younger generation on the importance of the conservation and protection of the environment, especially the rivers. To date, we have enlisted 3,487 school children and 148 schools in the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya into the programme. In November 2007, our River Rescue Brigade was accorded an Honourable Mention at the inaugural Prime Minister s Corporate Social Responsibility (CSR) Award Another programme, the Educational Outreach Programme (Turun Ke Padang) launched in 1999, is an extension of the River Rescue Brigade, which aims to educate the primary school children located within our areas of operations on the importance of river preservation. The objectives of these programmes are to ensure the continuous supply of clean water as well as to enlighten them on the roles played by PNSB and SYABAS in the water treatment and water distribution processes respectively. OUR FUTURE PLANS As the PNHB Group seeks to grow its business and deliver value to its stakeholders, we will look into expanding our operations in areas related to our core business and competencies within Malaysia and undertaking projects in other countries such as India, China and the ASEAN countries. PUNCAK NIAGA HOLDINGS BERHAD 019

26 CORPORATE INFORMATION ANNUAL REPORT 2009 BOARD OF DIRECTORS Yang Berbahagia Tan Sri Rozali Ismail Executive Chairman Yang Berbahagia Dato Hashim Mahfar Managing Director Yang Berbahagia Dato Ruslan Hassan Non-Independent Non-Executive Director Yang Berbahagia Dato Ir Lee Miang Koi Non-Independent Non-Executive Director Yang Berbahagia Dato Syed Danial Syed Ariffin Chief Operating Officer Yang Berbahagia Tan Sri Dato Hari Narayanan Govindasamy Independent Non-Executive Director Yang Berbahagia Tan Sri Dato Seri Dr Ting Chew Peh Independent Non-Executive Director Yang Amat Mulia Tengku Dato Rahimah Almarhum Sultan Mahmud Non-Independent Non-Executive Director Yang Berbahagia Tan Sri Dato Ahmad Fuzi Haji Abdul Razak Independent Non-Executive Director Mr Ng Wah Tar Executive Director, Finance Division COMPANY SECRETARIES Madam Tan Bee Lian, MAICSA Madam Lim Yew Heang, MAICSA REGISTERED OFFICE 10th Floor, Wisma Rozali No. 4, Persiaran Sukan Seksyen Shah Alam Selangor Darul Ehsan Tel: Fax: PRINCIPAL OFFICE Wisma Rozali No. 4, Persiaran Sukan Seksyen Shah Alam Selangor Darul Ehsan Tel: Fax: (general): (investors): website: BRANCH OFFICES PENANG OFFICE Block C, No.12, Jalan Todak 5 Pusat Bandar Seberang Jaya Perai Pulau Pinang Tel: Fax: KUALA TERENGGANU OFFICE 201B, Jalan Sultan Zainal Abidin Kuala Terengganu Tel: Fax: CHINA OFFICES Sino Water Environmental Consultancy (Shanghai) Co. Ltd Unit 301, No. 398, City Gateway Caoxi (North) Road, Xuhui District Shanghai People s Republic of China Tel: Fax: Luwei (Pingdingshan) Water Co. Ltd No. 6, ShunCheng Road (East) Lushan County, Henan Province People s Republic of China Tel/Fax: Xinnuo Water (Binzhou) Co. Ltd Laodian Village Tannery Industry Park Laodian Village, Binzhou County Shandong Province People s Republic of China Luancheng Dayu Water Supply Co. Ltd No. 153, DaQiao Road Luancheng County, Hebei Province People s Republic of China Tel/Fax: Hebei Sino Panlong Industrial Water Supply Co. Ltd No. 117, Renmin Road, Yuanshi County Shijiazhuang City, Hebei Province People s Republic of China PUNCAK NIAGA HOLDINGS BERHAD 020 SINGAPORE OFFICE Sino Water Pte Ltd No. 8, Eu Tong Sen Street #22-85 & #22-86, The Central Singapore Tel: (Main Line) / Fax:

27 ANNUAL REPORT 2009 DATE AND PLACE OF INCORPORATION 7 January 1997, Malaysia COMPANY NUMBER U AUDITORS Messrs Ernst & Young (AF 0039) TAX ADVISOR Ernst & Young Tax Consultants Sdn Bhd PRINCIPAL BANKERS RHB Bank Berhad (6171-M) CIMB Investment Bank Berhad (13491-P) AmIslamic Bank Berhad ( U) Hong Leong Investment Bank Berhad (43526-P) SOLICITORS Messrs Adnan Sundra & Low Messrs Azian Haslina & Co Messrs Belden Messrs Cheang & Ariff Messrs Marcia Ng & Associates Messrs Sreenevasan Young Messrs Wong & Partners Messrs Zul Rafique & Partners SHARE REGISTRAR (Place where all registers of securities are kept) Tricor Investor Services Sdn Bhd (formerly known as Tenaga Koperat Sdn Bhd) ( V) Level 17, The Gardens North Tower Mid Valley City Lingkaran Syed Putra Kuala Lumpur Tel: Fax: STOCK EXCHANGE LISTING Main Market of Bursa Malaysia Securities Berhad under the Infrastructure Project Companies Sector INDICES FTSE Bursa Malaysia Kuala Lumpur FTSE Bursa Malaysia Emas Syariah Index AUDIT COMMITTEE Chairman Yang Berbahagia Tan Sri Dato Seri Dr Ting Chew Peh Members Yang Berbahagia Tan Sri Dato Hari Narayanan Govindasamy Yang Amat Mulia Tengku Dato Rahimah Almarhum Sultan Mahmud Yang Berbahagia Tan Sri Dato Ahmad Fuzi Haji Abdul Razak Secretaries Madam Tan Bee Lian Madam Lim Yew Heang REMUNERATION COMMITTEE Chairman Yang Berbahagia Tan Sri Dato Ahmad Fuzi Haji Abdul Razak Members Yang Berbahagia Tan Sri Dato Hari Narayanan Govindasamy Yang Berbahagia Tan Sri Dato Seri Dr Ting Chew Peh Mr Ng Wah Tar Secretaries Madam Tan Bee Lian Madam Lim Yew Heang NOMINATION COMMITTEE Chairman Yang Berbahagia Tan Sri Dato Ahmad Fuzi Haji Abdul Razak Members Yang Berbahagia Tan Sri Dato Hari Narayanan Govindasamy Yang Berbahagia Tan Sri Dato Seri Dr Ting Chew Peh Secretaries Madam Tan Bee Lian Madam Lim Yew Heang COMPLIANCE, INTERNAL CONTROL AND RISK POLICY COMMITTEE (CICR) Chairman Yang Berbahagia Tan Sri Dato Seri Dr Ting Chew Peh Members Yang Berbahagia Dato Hashim Mahfar (Head of CICR) Tuan Haji Sonari Solor Mr Ng Wah Tar Madam Tan Bee Lian Secretary Encik Mohammed Sofian Ismail (Head of Risk Management Section) PUNCAK NIAGA HOLDINGS BERHAD 021

28 PNHB FACT SHEET ANNUAL REPORT 2009 Authorised Share Capital Paid-Up Share Capital RM1,300,000, RM411,142, (comprising 411,142,895 ordinary shares of RM1.00 each) Number of RUN Issued 546,875,000 RUN Coupon Rates 2.5% per annum for the first 10 years and 3.5% per annum for the remaining 5 years (begining 20 November 2011) RUN Maturity Date 18 November 2016 RUN Holders Put Option Date 20 November 2011 RUN Redemption Dates ( ) First (1st) Mandatory Partial Redemption - 20 November 2007 (completed) Second (2nd) Mandatory Partial Redemption - 20 November 2008 (completed) Third (3rd) Mandatory Partial Redemption - 20 November 2009 (completed) Fourth (4th) Mandatory Partial Redemption - 20 November 2010 Fifth (5th) Mandatory Partial Redemption - 20 November 2011 Sixth (6th) Mandatory Partial Redemption - 20 November 2012 PNSB FACT SHEET AS AT 31 DECEMBER 2009 Number of PNSB s Water Treatment Plants 29 Number of Water Treatment Plants with ISO Certifications 20 SYABAS FACT SHEET AS AT 31 DECEMBER 2009 Number of SYABAS Consumer Accounts million Maintenance of water pipes 24,893 km Number of service reservoirs, elevated water tanks 1,240 and suction tanks Number of pumping stations 451 GROUP MANPOWER AS AT 26 APRIL 2010 Category No. of Gender Race (In Malaysia) Race (Overseas) of Employees Personnel Male Female Malay Chinese Indian Others Chinese Management Executive Non-Executive 3,111 2, , Total 4,103 3,087 1,016 3, PUNCAK NIAGA HOLDINGS BERHAD 022

29 ANNUAL REPORT 2009 LIST OF CORPORATE MEMBERSHIPS 1 Malaysian Water Association (MWA) Member since Malaysia South-South Association (MASSA) Member since Federation of Public Listed Companies (FPLC) Member since Malaysian Employers Federation (MEF) Member since Malaysian Industry-Government Group for High Technology (MIGHT) Member since Malaysian-German Chamber of Commerce and Industry (MGCC) Member since National Institute of Occupational Safety and Health (NIOSH) Member since American Water Works Association (AWWA) Member since Malaysian-French Chamber of Commerce and Industry (MFCCI) Member since Malaysia-Russia Business Council Member since British Malaysian Chamber of Commerce (BMCC) Member since Malaysia-Japan Economic Association (MAJECA) Member since Commonwealth Partnership for Technology Management (CPTM) Member since Institute of Marketing Malaysia (IMM) Member since South East Asian Water Utilities Network (SEAWUN) Member since Malaysian Islamic Chamber of Commerce (MICC) Member since Singapore Water Association Member since Malaysian Investors Relations Association (MIRA) Member since Water Association of Selangor, Kuala Lumpur and Putrajaya (SWAn) Member since Malaysian Nature Society (MNS) Member since Environmental Management & Research Association of Malaysia (ENSEARCH) Member since 2009 GROUP MANPOWER ANALYSIS AS AT 26 APRIL 2010 Breakdown by Category Breakdown by Gender Breakdown by Race Overseas MALE MALAY INDIAN CHINESE 12.1% 82.1% 18.4% 76.3% 9.5% 87.3% 8.5% 85.8% 5.83% 75.8% 5.8% 5.3% 3.2% 5.7% FEMALE CHINESE OTHERS 18.4% 37.4% 56.7% 52.4% 8.3% 41.7% 54.1% 5.9% 39.3% 4.2% Management Executive Non-Executive TOTAL TRAINING ORGANISED IN YEAR 2009 Total: 676 NUMBER OF STAFF TRAINED IN YEAR 2009 BY CATEGORY Total: 3, % 17.90% In-House Personal & Leadership Development (15) In-House Functional/ Knowledge Programme (121) 18.92% 73.61% Directors & Management (244) Executive (618) 0.44% In-House Supplementary Knowledge Programme (394) Non-Executive (2,405) 58.28% 2.22% Positive Mindset (3) 7.47% External Courses (Local/Overseas) (143) PUNCAK NIAGA HOLDINGS BERHAD 023

30 CORPORATE ACHIEVEMENTS ANNUAL REPORT MALAYSIA HR AWARDS HR EXCELLENCE CATEGORY Bronze Award awarded to SYABAS on 25 March WATER INNO AWARDS 2009 MALAYSIAN WATER ASSOCIATION (MWA) Innovation in Information Technology, Computer Software and Training Category Silver Award awarded to SYABAS on 19 May WATER INNO AWARDS 2009 MALAYSIAN WATER ASSOCIATION (MWA) Innovation in Solution Technology in Water Management Silver Award awarded to SYABAS on 19 May MALAYSIAN SOCIETY FOR OCCUPATIONAL SAFETY AND HEALTH (MSOSH) OSH SILVER AWARD 2008 Silver Award for Utilities Sectors Category awarded to SYABAS Kuala Lumpur, Petaling, Hulu Langat, Sabak Bernam and Kuala Langat District Offices on 7 August ACCA MALAYSIA SUSTAINABILITY REPORTING AWARDS (MaSRA) 2009 PNHB was the winner for Integrated Reporting in an Annual Report on 13 August ACCA MALAYSIA SUSTAINABILITY REPORTING AWARDS (MaSRA) 2009 PNHB was shortlisted under the Integrated Reporting in an Annual Report on 13 August 2009 PUNCAK NIAGA HOLDINGS BERHAD 07 NATIONAL ANNUAL CORPORATE REPORT AWARDS (NACRA) 2009 Certificate of Merit awarded to PNHB on 1 December STARBIZ-ICR MALAYSIA CORPORATE RESPONSIBILITY AWARDS 2009 Finalist for Market Capitalisation of RM1 Billion and Above Category awarded to PNHB on 5 March INNOVATIVE & CREATIVE CIRCLE (ICC) CENTRAL REGION MINI CONVENTION 2010 MALAYSIAN PRODUCTIVITY CORPORATION Gold Award awarded to SYABAS ICC Falcon Team on 13 April INNOVATIVE & CREATIVE CIRCLE (ICC) CENTRAL REGION MINI CONVENTION 2010 MALAYSIAN PRODUCTIVITY CORPORATION Gold Award awarded to SYABAS ICC Smart Team on 13 April

31 OUR ROLE IN THE WATER SUPPLY SYSTEM ANNUAL REPORT 2009 REGULATORY AUTHORITIES OPERATORS Policy, Planning, Enforcement and Surveillance by Government Agencies Selangor Water Management Authority (LUAS) Department of Environment (DOE) Department of Irrigation and Drainage Malaysia (DID) Manages river basin upstream beginning 3 nautical miles from the sea Oversees environment issues concerning rivers Flood control and river management Rivers Dams SCHEMATIC DIAGRAM OF WATER TREATMENT SYSTEM Dam Operators in Selangor Puncak Niaga (M) Sdn Bhd (PNSB) Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (SPLASH) Konsortium ABASS Sdn Bhd RAW WATER PUMP BAND SCREEN GRIT CHAMBER WTP Operators in Selangor INTAKE MODIFIED LIQUID ALUM FILTRATION TANK CHLORINE SODIUM SILICOFLOURIDE HYDRATED LIME Puncak Niaga (M) Sdn Bhd (PNSB) Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (SPLASH) Konsortium ABASS Sdn Bhd AERATOR MIXING CHANNEL FLOCCULATION CHANNEL SEDIMENTATION TANK FILTRATION GALLERY TREATED WATER PUMP BALANCING RESERVOIR TO RIVER / SLUDGE LAGOONS CLEAR WATER TANK BULK METERS National Water Services Commission (SPAN) RESERVOIR WATER TOWER BOOSTER STATION SERVICE RESERVOIR Water Supply Distributor for Selangor, Kuala Lumpur and Putrajaya Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS) Water Meter (Condominium/ Flat) Water Meter (Industrial/ Factory) Water Meter (Office) Water Meter (Shopping Centre) Consumers Water Meter (Residential Home) Water Meter (Government/ Institutional) PUNCAK NIAGA HOLDINGS BERHAD 025

32 CORPORATE STRUCTURE ANNUAL REPORT 2009 INVESTMENT HOLDING 100% PUNCAK OIL & GAS SDN BHD exploration for the production of oil and gas and other materials and the provision of offshore and onshore engineering works 100% PUNCAK NIAGA (M) SDN BHD operation, maintenance, management, construction, rehabilitation and refurbishment of water treatment facilities 100% PUNCAK RESEARCH CENTRE SDN BHD research and development and technology development for water, wastewater and environment sectors 100% IDEAL WATER RESOURCES SDN BHD ceased operation 100% UNGGUL RAYA (M) SDN BHD ceased operation 100% PUNCAK SERI (M) SDN BHD dormant 70% SYARIKAT BEKALAN AIR SELANGOR SDN BHD supply and distribution of treated water within Selangor and the Federal Territories of Kuala Lumpur and Putrajaya 100% PUNCAK NIAGA (INDIA) SDN BHD dormant 100% PERBADANAN URUS AIR SELANGOR BERHAD ceased operation 100% NS WATER SYSTEM SDN BHD dormant 80% SINO WATER PTE LTD investment in water and wastewater projects in China PUNCAK NIAGA HOLDINGS BERHAD 026 ASSOCIATE COMPANY 50% PURNAMA PERSADA SDN BHD dormant ASSOCIATE COMPANY 40% OASIS WATER RESOURCES SDN BHD dormant 100% SINO WATER ENVIRONMENTAL CONSULTANCY (SHANGHAI) CO. LTD consultancy services for water and wastewater projects 80% LUANCHENG DAYU WATER SUPPLY CO. LTD treatment and distribution of water and related services 83% LUWEI (PINGDINGSHAN) WATER CO. LTD treatment and distribution of water and related services 100% XINNUO WATER (BINZHOU) CO. LTD treatment of wastewater and related services 80% HEBEI SINO PANLONG INDUSTRIAL WATER SUPPLY CO. LTD distribution of water to industrial areas

33 ORGANISATION STRUCTURE PNSB ANNUAL REPORT 2009 BOARD OF DIRECTORS EXECUTIVE CHAIRMAN S OFFICE Senior General Manager Mr Ramalingam K R Arumugam General Manager YBhg Dato Ismail Hamid EXECUTIVE CHAIRMAN YBhg Tan Sri Rozali Ismail MANAGING DIRECTOR YBhg Dato Hashim Mahfar CHIEF OPERATING OFFICER YBhg Dato Syed Danial Syed Ariffin General Manager Encik Kamaruzaman Budin CONTRACT & PROCUREMENT DEPARTMENT General Manager Puan Hafizah Ahmat INTERNAL AUDIT DEPARTMENT Senior Manager Encik Mohammed Sofian Ismail OPERATION & MAINTENANCE (O&M) DIVISION Executive Director Ir Tan Hui Kuan O&M DEPARTMENT O&M SECTION (All WTPs & Dams) HEALTH, SAFETY & QUALITY MANAGEMENT SECTION WATER QUALITY & RESEARCH SECTION ENGINEERING/PROJECT DEVELOPMENT (EPD) DIVISION Executive Director Ir Ooi Cheng Swee EPD DEPARTMENT ENGINEERING SECTION PROJECT SECTION BUSINESS DEVELOPMENT DIVISION Executive Director YBhg Dato Nasir Khan Illadad Khan FINANCE DIVISION Executive Director Mr Danny Ng Wah Tar HUMAN RESOURCES & ADMINISTRATION DIVISION Executive Director YBhg Datuk Mohd Yunus Mohd Amin CORPORATE SERVICES DIVISION Executive Director Madam Tan Bee Lian PUBLIC RELATION & FOOD & BEVERAGE DIVISION General Manager Encik Zulbahari Abu Bakar General Manager Encik Halmar Hasina Wijaya Muhammad Isa WATER/WASTEWATER DEPARTMENT Assistant General Manager Encik Juhari Abdullah OIL & GAS DEPARTMENT Assistant General Manager Encik Zohrab Zolkipli ENVIRONMENTAL DEPARTMENT GENERAL DEPARTMENT FINANCE & ACCOUNTS DEPARTMENT General Manager Ms Poh Khang Mei COMPENSATION & BENEFIT SECTION Assistant General Manager Encik Nik Azmi Nik Yaacob ACCOUNTS SECTION CORPORATE FINANCE DEPARTMENT Senior Manager Mr Nicholas Chew Keng Meng HUMAN RESOURCES MANAGEMENT DEPARTMENT Senior Manager Encik Muhamad Noor Md Darus ADMINISTRATION DEPARTMENT VEHICLE MANAGEMENT & GENERAL SERVICES SECTION ASSET MANAGEMENT SECTION INFORMATION TECHNOLOGY DEPARTMENT Assistant General Manager Encik Adi Azmir Abdul Ghani SECRETARIAL DEPARTMENT General Manager Madam Lim Yew Heang LEGAL DEPARTMENT STRATEGIC RESOURCE CENTRE Senior General Manager YBhg Datuk Dr Muzahet Masruri PUBLIC RELATION DEPARTMENT Assistant General Manager Encik Badrul Hisham Abdullah FOOD & BEVERAGE DEPARTMENT Manager Encik Hamzah Awang Kechik INDUSTRIAL RELATION DEPARTMENT Senior Manager Puan Mahuran Saro Sariki PROPERTY MANAGEMENT DEPARTMENT PEKA PROTECTIVE SERVICES DEPARTMENT General Manager Encik Saadon Kardi PUNCAK NIAGA HOLDINGS BERHAD 027

34 ORGANISATION STRUCTURE SYABAS ANNUAL REPORT 2009 EXECUTIVE CHAIRMAN YBhg Tan Sri Rozali Ismail EXECUTIVE CHAIRMAN S OFFICE Executive Director Encik Othman Ismail CHIEF EXECUTIVE OFFICER YBhg Dato Ruslan Hassan General Manager CORPORATE AFFAIRS DIVISION Executive Director Encik Abdul Halem Mat Som FINANCE DIVISION Executive Director Madam Thein Kwee Sim HUMAN RESOURCE & ADMINISTRATION DIVISION Executive Director Tuan Haji Zainuddin Othman General Manager ICT, LEGAL & CONTRACT DIVISION Executive Director CORPORATE COMMUNICATIONS & PUBLIC AFFAIRS DEPARTMENT General Manager Assistant General Manager Cik Shahrul Bariah Mohd Rejab BRANDING & CREATIVE SECTION Manager Puan Balqesh Abdullah CORPORATE RESPONSIBILITY SECTION Manager Puan Norhaslina Ibrahim MEDIA RELATIONS SECTION Manager Puan Hasimah Che Mat Din COMMUNICATIONS SECTION Manager Ms Sharon Wong Lee Fong Senior Manager Encik Abdul Raof Ahmad PUBLIC AFFAIRS SECTION Manager EVENT MANAGEMENT SECTION Manager ADMINISTRATION SECTION Manager Mr Krishnamoorthy a/l Ramamurti CUSTOMER SERVICE DEPARTMENT General Manager Puan Adelina Iskandar CALL CENTRE SECTION Senior Manager Encik Mohd Sufian Sahran ICU SECTION Manager Encik Abdul Manaf Ayoub YAKIN SECTION Manager Encik Hazamuddin Hashim COUNTER SERVICE SECTION FINANCE & ACCOUNTS DEPARTMENT Senior General Manager Madam Chong Poh Leng TREASURY & BANKING SECTION Senior Manager Encik Shamsul Mohamed Isa REGULATORY REPORTING & INFO COORDINATION UNIT Manager ACCOUNTS & FINANCIAL REPORTING SECTION Senior Manager PAYABLE & DISTRICT SECTION Senior Manager BILLING & RECOVERY DEPARTMENT General Manager Encik Shahruddin Ab Rahman BILLING ADMINISTRATION SECTION Senior Manager BILLING ADMINISTRATION Manager Encik Vasan a/l Ramachandram CONSUMER COMPLAINTS MANAGEMENT SECTION Manager Puan Suhaida Harun BASIS ADMINISTRATION SECTION Assistant Manager Madam Selvarani a/p Karumadi COLLECTING AGENTS/ CORPORATE CONSUMER MANAGEMENT Manager Puan Rima Melini Md Tamin BILLING/ DISTRICT MONITORING/ GOVT ACCOUNTS MANAGEMENT Manager Encik Asararuddin Abd Mutalib HUMAN RESOURCE DEPARTMENT RECRUITMENT & STAFF INFORMATION SYSTEM SECTION Manager Puan Noor Fadilla Mahamad Samsi INDUSTRIAL RELATIONS SECTION Manager Puan Faridatulzakiah Mohd Bakhry TRAINING & CAREER DEVELOPMENT SECTION Senior Manager Puan Yasmin Hood PERFORMANCE MANAGEMENT & CAREER DEVELOPMENT SECTION Senior Manager Puan Khamsiah Mohd Saad COMPENSATION & BENEFITS/ EMPLOYEE RELATIONS SECTION Senior Manager Puan Aida Yuhana Zainul Ariff HEALTH, SAFETY & ENVIRONMENTAL SECTION Senior Manager Encik Taufik Afendy Othman ADMINISTRATION DEPARTMENT Senior Manager Encik Badrul Affandy B. Bahkia OFFICE SERVICES MANAGEMENT SECTION Manager Encik Abd Rahman Bakar FACILITIES MANAGEMENT SECTION Manager Encik Damuri Dollah SPORTS & RECREATIONAL SECTION Assistant Manager Encik As ad Mohd Sidek STORE & PURCHASING MANAGEMENT SECTION Manager Encik Norzaini Mohamad Yatim INFORMATION & COMMUNICATION TECHNOLOGY DEPARTMENT Senior General Manager Encik Mohd Suhaimi Rafie NETWORK OPERATION CENTRE SECTION Manager Encik Norhisham Khalil BUSINESS APP. SUPPORT SECTION Manager Puan Munaliza Maseran PROGRAMME PLANNING SECTION Manager Dr Hamidun Jaafar TECHNICAL SUPPORT & COMPLIANCE SECTION Manager APPLICATION DEVELOPMENT SECTION Manager Puan Norizan Othman LEGAL & ENFORCEMENT DEPARTMENT General Manager Puan Nik Aliena Salwanee Nik Mohamed LITIGATION SECTION Assistant General Manager Mr Vignesweran a/l Thambirajah CORPORATE ADVISORY & COMPLIANCE SECTION Senior Manager Manager Puan Siti Farah Husna Adam Sani ENFORCEMENT SECTION Manager Encik Vishnu Kumar a/l Visvanathan CONTRACT & PROCUREMENT DEPARTMENT General Manager Ir Nasir Ismail PRE TENDER & PROCUREMENT SECTION Assistant Manager Puan Nurina Nawi PRE TENDER & GENERAL CONTRACT ADMINISTRATION SECTION Senior Manager Encik Wan Abdul Aziz Wan Muda POST TENDER & CONTRACT MONITORING SECTION Senior Manager Madam Phoon Yin Fong NORTHERN ZONE KUALA SELANGOR (CATEGORY C) Assistant General Manager Encik Abdul Halim Ishak SABAK BERNAM (CATEGORY C) Manager Encik Ahmad Fuad Zainudin HULU SELANGOR (CATEGORY C) Assistant General Manager Encik Abdul Latip Mustafa PUNCAK NIAGA HOLDINGS BERHAD 028 GOMBAK (CATEGORY A) General Manager Encik Mohd Yaman Mohd Zin

35 ANNUAL REPORT 2009 INTERNAL AUDIT DEPARTMENT Senior General Manager Tuan Haji Sonari Solor SECRETARIAL DEPARTMENT Senior Manager Madam Lau Pueh Geok CHIEF OPERATING OFFICER (COO) YBhg Dato Ir Lee Miang Koi STRATEGIC RESOURCE DIVISION Executive Director Ir V Subramaniam OPERATION & MAINTENANCE DIVISION Senior General Manager Encik Muhamad Darif Idris PROJECT DIVISION Executive Director Encik Sanusi Sulieman CRISIS COORDINATOR & CONTINGENCY SECTION Assistant Manager Encik Mohd Najib Azizan OPERATION COORDINATOR SECTION Assistant Manager Encik Yusran Yusof INSPECTORATE AND COMPLIANCE SECTION Manager Encik Abd Hafidz Mohd Tahet CENTRAL ZONE KUALA LUMPUR (CATEGORY A) General Manager Cik Hayati Ab Wahab DISTRICT DEPARTMENT Senior General Manager Encik Ismail bin Rusmin SECURITY SECTION Assistant General Manager Encik Zainal Rashid Adnan ENFORCEMENT SECTION Assistant General Manager Encik Yusof Awang Dollah Senior Manager Encik Idros Said CONSUMERISM AND PUBLIC MONITORING SECTION SOUTHERN ZONE HULU LANGAT (CATEGORY B) General Manager Encik Ariff Ibrahim WATER QUALITY DEPARTMENT Senior General Manager Puan Roowina Merican A Rahim Merican WATER QUALITY SURVEILLANCE SECTION Senior Manager Encik Mokhtar Atan ENVIRONMENTAL SURVEILLANCE SECTION Manager DISTRIBUTION ASSET SECTION Manager Encik Roslan Osman CENTRE FOR TECHNICAL DEVELOPMENT SECTION General Manager CENTRE FOR RESEARCH & DEVELOPMENT SECTION Senior Manager STRATEGIC RESOURCE CENTRE SECTION DEVELOPMENT DEPARTMENT Senior Manager Puan Rosmizah Ahmad NORTHERN ZONE SECTION Senior Manager Cik Maimunah Musa CENTRAL ZONE SECTION Manager Ir Pua Eng Teik SOUTHERN ZONE SECTION Assistant Manager Encik Zamzuri Selamat OPERATION & MAINTENANCE DEPARTMENT General Manager EncikYusof Saroji PRODUCTION SECTION Manager BULK TRANSFER & TRANSMISSION SYSTEM SECTION Manager TRANSPORT MANAGEMENT SECTION Assistant Manager Encik M. Taran Daniel MECHANICAL & ELECTRICAL SECTION Senior Manager Encik Mohd Yusri Abu Samah CONTACT ADMINISTRATION SECTION Senior Manager Puan Ramnah Mohd Ramli PLANNING AND DESIGN DEPARTMENT Assistant General Manager Ir Hussain Salikin DESIGN SECTION Senior Manager Ir You Ho Hu PLANNING SECTION Manager Ir Rohizan M Asmoni NETWORK & INSTRUMENTATION DEPARTMENT General Manager Ir Dr Teoh Seng Giap GIS SECTION Senior Manager Encik Hairuddin Munip Manager Encik Mohd Sapran Hosnan HYDRAULIC MODELING SECTION Senior Manager Ir Wan Mohamed Jaafar Wan Ahmad Nasiry SCADA SECTION Senior Manager Encik Wan Burahanudin Wan Ismail NON REVENUE WATER (NRW) DEPARTMENT General Manager Ir Albert Loh Thiam Hock Assistant General Manager Encik Mohd Yunus Othman COMMERCIAL LOSS REDUCTION SECTION Manager Encik Mohamad Nasir Ramli PHYSICAL LOSS REDUCTION SECTION Assistant Manager Encik Mohamed Rizal Gazali PROJECT MANAGEMENT DEPARTMENT Assistant General Manager Encik Muhamad Zuki Mat Zin SOUTHERN REGION Senior Manager Encik Musa Omar CENTRAL REGION Manager Encik Mohd Ridzalhuddin Osman NORTHERN REGION Senior Manager Encik Shahrom Hashim CONTRACT ADMINISTRATION Assistant Manager Encik Azhar Ayob PETALING (CATEGORY A) Senior General Manager Encik Abdul Rashid Abd Satar KUALA LANGAT (CATEGORY C) Manager Encik Khairul Anuwar Ismail SEPANG (CATEGORY C) Senior Manager Encik Mohd Indra Arshad KLANG (CATEGORY A) General Manager Encik Ahmad Suhaidin Ismail PUNCAK NIAGA HOLDINGS BERHAD 029

36 BOARD OF DIRECTORS PROFILE ANNUAL REPORT 2009 YBHG TAN SRI ROZALI ISMAIL AGED 53, MALAYSIAN EXECUTIVE CHAIRMAN OF PNHB GROUP YBhg Tan Sri Rozali Ismail is the founder of Puncak Niaga (M) Sdn Bhd (PNSB), the Executive Chairman of Puncak Niaga Holdings Berhad (PNHB) Group and substantial shareholder of PNHB. He was appointed to the Board of PNHB on 24 April A Bachelor of Laws Degree holder from the University of Malaya in 1981, YBhg Tan Sri Rozali began his career as Legal Advisor with the Urban Development Authority (UDA) before joining Bank Islam (M) Berhad in Together with a few pioneer bank staff, he conceptualised the first institution of Islamic banking in Malaysia. Subsequently, in 1987, he started his own legal practice as an Advocate and Solicitor for seven years, specialising in corporate, property and banking works. In 1989, YBhg Tan Sri Rozali set up a family-owned company and embarked into the property development sector, with involvement in several development projects in the Klang Valley, Kuantan and Johor. Under the banner of Puncak Alam Housing Sdn Bhd, he developed a new township known as Bandar Baru Puncak Alam. The family-owned company also ventured into the utility business in 1989 with the setting up of PNSB. Due to his vast experience in various fields, he was entrusted by the Selangor State Government, via PNSB, to manage the water treatment plants for the whole of the State of Selangor Darul Ehsan and the Federal Territory of Kuala Lumpur. PNHB was subsequently incorporated in January 1997 as the holding company of PNSB and was listed on the Main Board of Bursa Malaysia Securities Berhad (effective 3 August 2009 known as Main Market of Bursa Malaysia Securities Berhad) on 8 July YBhg Tan Sri Rozali was conferred a Fellowship Award by the Institute of Marketing Malaysia (IMM) on 6 November 2001 for his invaluable contributions to promote the growth and development of the Malaysian property market. In recognition of his outstanding contributions in championing management excellence and best practices in the Malaysian water and wastewater industry, YBhg Tan Sri Rozali was awarded the prestigious Asia Water Management Excellence Award Individual Award Category, an award at Asian level, by the Regional Institute of Environmental Technology on 26 March YBhg Tan Sri Rozali was a Top 10 Nominee for the Ernst & Young Entrepreneur Of The Year - Malaysia 2002 and Malaysia 2003 (Master Entrepreneur Category) Award in recognition of his outstanding entrepreneurship and leadership skills. He was conferred an Honorary Doctorate in Complementary Medicines (Humanity Services) by the Open International University for Complementary Medicines, Colombo, Sri Lanka on 24 September PUNCAK NIAGA HOLDINGS BERHAD 030

37 ANNUAL REPORT 2009 On 30 November 2007, YBhg Tan Sri Rozali was bestowed the SME Platinum Award 2007 by the SMI Association of Malaysia for his outstanding entrepreneurship, leadership and achievements in the water industry. This award signals the SMI Association of Malaysia s recognition of YBhg Tan Sri Rozali as a role model for budding entrepreneurs, especially in view of his rapid rise from a small and medium business entrepreneur to becoming a Chief Executive Officer of a large listed company. In recognition of his excellent services performed with utmost dedication towards the betterment of the community, YBhg Tan Sri Rozali was the proud recipient of the Vocational Excellence Service Award 2009, conferred by the Paul Harris Fellow Award and inducted as an Honorary Rotarian by the Rotary Club of Kuala Lumpur West on 6 November YBhg Tan Sri Rozali received the title Kolonel Kehormat Rejimen Pakar Pengendalian Air Ke-60 RAJD (AW) on 16 January YBhg Tan Sri Rozali is a member of various influential governmental and non-governmental associations such as Malaysian Industry-Government Group for High Technology (MIGHT), Malaysian Institute of Directors (MID), Malaysian- British Business Council, Malaysia-Indonesia Business Council, Corporate Malaysia Roundtable, Malaysia-Russia Business Council, Commonwealth Partnership for Technology Management, FELDA Community Social Development Committee, Yayasan Budi Penyayang Malaysia and a Trustee of Perdana Leadership Foundation, Yayasan WAQAF Malaysia (YWM) (January December 2009) and Sekretariat Malaysia Prihatin. He is the Advisor to IMM, President of the Malay Chamber of Commerce for the State of Selangor, Pro-Chancellor of University Putra Malaysia (July June 2010), Governor for Malaysia of Asia Pacific Marketing Federation (APMF) Foundation, Advisor of Gabungan Persatuan Usahawan Melayu Selangor/ Wilayah Persekutuan (GAPUMS), Advisor of Gabungan Pelajar Melayu Semenanjung (GPMS) ( Session), Committee Member of Gagasan Badan Ekonomi Melayu (GABEM) Negeri Selangor, Life Member of Gabungan Ikhtisas Dan Usahawan Bumiputra Anak Selangor, Selangor (GIBS) and Advisor of Persatuan Bola Sepak Melayu Malaysia ( PBSMM ). In November 2006, YBhg Tan Sri Rozali set up the Water Association of Selangor, Kuala Lumpur and Putrajaya (SWAn), a non-profit organisation which represents the common interest of all water supply and wastewater industries within the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya with the aim of promoting interaction with the general public, and enhancing their understanding of water resources. He is the President of SWAn for the 2009/2011 Session. YBhg Tan Sri Rozali is the past Deputy President of the Malaysian Water Association (MWA) (2003/2005 Session), former Board Member of Universiti Utara Malaysia ( ) and past Advisor of the Business and Accounting Faculty Council, University of Malaya (21 May 2004 to 20 April 2007). Besides PNHB, YBhg Tan Sri Rozali is also the major shareholder of two listed companies, WWE Holdings Bhd, a wastewater and environmental engineering services company and TRIplc Berhad, a listed property company. YBhg Tan Sri Rozali attended 5 out of the 6 Board Meetings of PNHB held in the financial year ended 31 December PUNCAK NIAGA HOLDINGS BERHAD 031

38 0 BOARD OF DIRECTORS PROFILE ANNUAL REPORT 2009 YBHG DATO HASHIM MAHFAR AGED 50, MALAYSIAN MANAGING DIRECTOR OF PNHB AND PNSB YBhg Dato Hashim Mahfar was appointed to the Board of PNHB and PNSB respectively on 1 January He was appointed as Head of PNHB s Compliance, Internal Control and Risk Policy Committee ( CICR ) and Chairman of SYABAS Audit Committee on 1 January He also sits on the Board of several private companies and he is a member of the Water Association of Selangor, Kuala Lumpur and Putrajaya (SWAn), a non-profit organisation which represents the common interest of all water supply and wastewater industries within the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya and to promote and advance interaction and understanding with members of the general public. He is also a member er of the Institute of Marketing Malaysia (IMM). He was with SAP Holdings Berhad from 1985 to 1996 where he started his working career as an Assistant Company Secretary. Over the years, he rose up to the rank of Group General Manager (Corporate Services). In 1996, he joined Bridgecon Holdings Berhad as Executive Director and was made the Group Managing Director/Chief Executive Officer and he was part of PNSB s Senior Management team in 1998 to YBhg Dato Hashim was the Managing Director of TRIplc Berhad from 2002 to December 2009 prior to joining PNSB. YBhg Dato Hashim did not attend any Board Meetings of PNHB held in the financial year ended 31 December 2009 as he was only appointed to the Board of PNHB on 1 January He did his tertiary education in 1981 at Universiti Teknologi MARA ( UiTM ) and attended the professional qualification of the Institute of Chartered Secretaries and Administrators (UK). Throughout his career, YBhg Dato Hashim has been very much involved in the corporate services which includes legal and secretarial, contract administration, marketing and corporate finance. He also has extensive operational experience in the property, construction and manufacturing sectors. PUNCAK NIAGA HOLDINGS BERHAD 032

39 ANNUAL REPORT 2009 YBHG DATO RUSLAN HASSAN AGED 54, MALAYSIAN NON-INDEPENDENT NON-EXECUTIVE DIRECTOR OF PNHB AND CHIEF EXECUTIVE OFFICER OF SYABAS YBhg Dato Ruslan Hassan joined PNSB on 1 November 1995 as the Executive Director of Corporate and Legal Affairs Division. When PNHB was set-up and listed on Bursa Malaysia Securities Berhad, YBhg Dato Ruslan was appointed to its Board on 24 April 1997 and on 6 April 1999, he was appointed as the Executive Vice Chairman.Together with the Executive Chairman, YBhg Tan Sri Rozali Ismail, YBhg Dato Ruslan played a principle role in pursuing for the privatization rights for the distribution of treated water in Selangor. Upon PNHB securing the water distribution concession for the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya on 1 January 2005, YBhg Dato Ruslan was appointed as the first Chief Executive Officer (CEO) of Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS). With his appointment as the CEO of SYABAS, YBhg Dato Ruslan relinquished his position as Executive Vice Chairman of PNHB and was re-designated to Non-Independent Non-Executive Director of PNHB with effect from 1 October YBhg Dato Ruslan has been a member of the Industrial Court- Employer Panel since 1 January He is also a member of the Malaysian Institute of Directors (MID), Malaysian Water Association (MWA), Institute of Marketing Malaysia (IMM) and International Water Association (IWA). Upon obtaining a Bachelor of Laws Degree from the University of Malaya in 1981, YBhg Dato Ruslan began his career as the Legal Advisor with the multinational petroleum company, ESSO Malaysia Bhd, and later as the Senior Legal Counsel of ESSO Production Malaysia Inc. In 1985, he joined the Sime Darby Group and was appointed as the Group Legal Advisor and Company Secretary of Pernas Sime Darby Holdings Sdn Bhd, with interests in automobile, plantation and heavy machinery. YBhg Dato Ruslan has 4 years experience as an Advocate and Solicitor in the capacity of a partner in a medium-sized legal firm. In 1993, he joined the securities and banking group of Rashid Hussain Berhad as the Senior General Manager of the Corporate Affairs Division. Within six (6) months of his appointment, he was appointed to the RHB Group and as a Director of Rashid Hussain Berhad as well as various subsidiaries of RHB. YBhg Dato Ruslan attended 6 out of the 6 Board Meetings of PNHB held in the financial year ended 31 December PUNCAK NIAGA HOLDINGS BERHAD 033

40 0 BOARD OF DIRECTORS PROFILE ANNUAL REPORT 2009 YBHG DATO IR LEE MIANG KOI AGED 56, MALAYSIAN NON-INDEPENDENT NON- EXECUTIVE DIRECTOR OF PNHB AND CHIEF OPERATING OFFICER OF SYABAS YBhg Dato Ir Lee Miang Koi joined PNSB in 1995 as the General Manager, Business Development. He was subsequently appointed as a Director of PNSB and PNHB on 2 February 1999 and 1 September 1999 respectively. On 1 January 2005, he was appointed as the Chief Operating Officer of SYABAS. YBhg Dato Ir Lee resigned as a Director of PNSB on 30 September 2005 and was re-designated to Non-Independent Non- Executive Director of PNHB with effect from 1 October He is a member of the Malaysian Water Association (MWA), the Malaysian Institute of Directors (MID) and the Institute of Marketing Malaysia (IMM). YBhg Dato Ir Lee graduated as a civil engineer from the Universiti Teknologi Malaysia in 1978 and in 1989, he obtained a Masters Degree in Environmental Engineering majoring in water supply and wastewater engineering from the Asian Institute of Technology in Bangkok. YBhg Dato Ir Lee has 32 years of experience in the water supply sector and has held various positions during his tenure with the Public Works Department as well as the Waterworks Department in Malaysia, specialising in the field of water supply services. He was previously a Director of the Negeri Sembilan Waterworks Department. He left the Public Works Department in 1991 to join Ranhill Bersekutu Sdn Bhd, holding various positions from Senior Engineer to Vice President. YBhg Dato Ir Lee attended 4 out of the 6 Board Meetings of PNHB held in the financial year ended 31 December PUNCAK NIAGA HOLDINGS BERHAD 034

41 ANNUAL REPORT 2009 YBHG DATO SYED DANIAL SYED ARIFFIN AGED 52, MALAYSIAN CHIEF OPERATING OFFICER OF PNHB AND PNSB AND A DIRECTOR OF SYABAS YBhg Dato Syed Danial Syed Ariffin graduated in 1981 with a BSc (Hons) Degree in Civil Engineering from the University of Aston in Birmingham, United Kingdom. He is a civil engineer by profession and has been with the PNHB Group since December He began his career with PNSB as a Manager of Operation and was subsequently promoted to Senior Manager, Assistant General Manager and General Manager of Operation. Prior to his appointments to the Boards of PNSB and PNHB on 1 March 2004, he was the Acting Executive Director of the Operation Division from July 2003 to February 2004 and subsequently re-designated as Executive Director, Operation I Division on 1 April On 16 November 2007, YBhg Dato Syed Danial was appointed as the Chief Operating Officer of PNHB and PNSB. He is also a Director of SYABAS since 3 September He was appointed as the Chairman of Sino Water Pte Ltd, PNHB s 80% owned subsidiary in Singapore on 1 January YBhg Dato Syed Danial previously worked with the Pahang Public Works Department for 10 years, holding positions from Project Engineer ( ) to District Engineer for JKR Cameron Highlands ( ), the Selangor Water Works Department between 1991 to 1995, where he was the Senior Project Engineer overseeing the construction of the Sungai Selangor Phase 1 Water Supply Project. YBhg Dato Syed Danial is a member of the Institute of Marketing Malaysia, Malaysian Water Association, a Registered Engineer with the Board of Engineers Malaysia, a member of Universiti Teknologi Mara s Board of Academics, Faculty of Civil Engineering (October September 2011 term), Advisor to the Institute For Infrastructure Engineering & Sustainable Management and he also sits on the Board of several private companies. He is a member of the Water Association of Selangor, Kuala Lumpur and Putrajaya (SWAn), a non-profit organisation which represents the common interest of all water supply and wastewater industries within the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya with the aim of promoting interaction with the general public and enhancing their understanding of water resources. YBhg Dato Syed Danial attended 6 out of the 6 Board Meetings of PNHB held in the financial year ended 31 December PUNCAK NIAGA HOLDINGS BERHAD 035

42 0 BOARD OF DIRECTORS PROFILE ANNUAL REPORT 2009 YBHG TAN SRI DATO HARI NARAYANAN GOVINDASAMY AGED 60, MALAYSIAN INDEPENDENT NON-EXECUTIVE DIRECTOR OF PNHB YBhg Tan Sri Dato Hari Narayanan Govindasamy, a businessman was appointed to the Board of PNHB on 1 July 1999 as an Independent Non-Executive Director. He is a member of PNHB s Audit Committee, Remuneration Committee and Nomination Committee. He holds a Bachelor s Degree in Electrical and Electronics Engineering from the University of Northumbria, England. YBhg Tan Sri Dato Hari Narayanan is a member of the Malaysian Institute of Directors and a Registered Professional Engineer with the Board of Engineers Malaysia. He has extensive experience in the field of electrical and electronic engineering and has held various key positions with established companies such as Inchcape Berhad and Tamco Cutler-Hammer Sdn Bhd as an engineer and entrepreneur. YBhg Tan Sri Dato Hari Narayanan also sits on the Boards of Tenaga Nasional Berhad and SP Setia Berhad, both public listed companies. He also holds chairmanships/directorships in several private limited companies. YBhg Tan Sri Dato Hari Narayanan attended 4 out of the 6 Board Meetings of PNHB held in the financial year ended 31 December PUNCAK NIAGA HOLDINGS BERHAD 036

43 ANNUAL REPORT 2009 YBHG TAN SRI DATO SERI DR TING CHEW PEH AGED 67, MALAYSIAN INDEPENDENT NON-EXECUTIVE DIRECTOR OF PNHB YBhg Tan Sri Dato Seri Dr Ting Chew Peh joined PNHB on 15 July 2000 as an Independent Non-Executive Director and a member of the Remuneration Committee and the Nomination Committee. Currently, he is the Chairman for both PNHB s Audit Committee and Compliance, Internal Control and Risk Policy Committee. He graduated with a Bachelor of Arts Degree from the University of Malaya in 1970 and obtained a Master of Science Degree from the University of London in He also holds a Doctorate in Philosophy, which he obtained from the University of Warwick in YBhg Tan Sri Dato Seri Dr Ting is a member of the Malaysian Institute of Directors. YBhg Tan Sri Dato Seri Dr Ting started his career as a lecturer in the Faculty of Humanities and Social Sciences at the Universiti Kebangsaan Malaysia from 1974 to 1980 and was subsequently an Associate Professor at the Faculty until Between 1979 to 1986, YBhg Tan Sri Dato Seri Dr Ting published two books entitled Konsep Asas Sosiologi and Hubungan Ras dan Etnik. In 1987, YBhg Tan Sri Dato Seri Dr Ting ventured into politics with his election as a Member of Parliament for the Gopeng constituency, which he held until the 2008 general elections. He previously served as Parliamentary Secretary of the Ministry of Health ( ), Deputy Minister in the Prime Minister s Department ( ), Minister of Housing and Local Government ( ) and Secretary-General of the Malaysian Chinese Association (MCA) ( ). He also sits on the Boards of Pan Malaysia Capital Berhad Group, Hua Yang Bhd, Pan Malaysia Corporation Berhad, Johan Holdings Berhad, Complete Logistic Services Berhad and also serves as a director of several private companies. YBhg Tan Sri Dato Seri Dr Ting attended 6 out of the 6 Board Meetings of PNHB held in the financial year ended 31 December PUNCAK NIAGA HOLDINGS BERHAD 037

44 0 BOARD OF DIRECTORS PROFILE ANNUAL REPORT 2009 YAM TENGKU DATO RAHIMAH ALMARHUM SULTAN MAHMUD AGED 44, MALAYSIAN NON-INDEPENDENT NON-EXECUTIVE DIRECTOR OF PNHB YAM Tengku Dato Rahimah Almarhum Sultan Mahmud was appointed to the Board of PNHB on 1 August 2006 as an Independent Non-Executive Director. On 1 January 2007, she was re-designated as a Non-Independent Non-Executive Director of PNHB following her appointment as the Executive Director of Puncak Research Centre Sdn Bhd. She was a past Member of PNHB s Audit Committee, Remuneration Committee and Nomination Committee for the period from 1 August 2006 to 31 December On 26 February 2008, YAM Tengku Dato Rahimah was re-invited to sit on PNHB s Audit Committee. YAM Tengku Dato Rahimah holds a BSc in Economics and Accountancy from the City of London University, England. She is a member of the Malaysian Institute of Accountants (MIA). Upon completing her degree, YAM Tengku Dato Rahimah started her career with the Hongkong Bank in London, England then joined Esso Malaysia Berhad (ESSO) upon her return in 1991 for five years, holding the position of Senior Accountant. YAM Tengku Dato Rahimah is currently the Chairman of Loh & Loh Corporation Berhad and a Director of Cosway (M) Sdn Bhd, a direct selling company dealing in consumer goods and services and a wholly owned subsidiary of Cosway Corporation Berhad. She also sits on the Boards of a few private limited companies. YAM Tengku Dato Rahimah attended 5 out of the 6 Board Meetings of PNHB held in the financial year ended 31 December PUNCAK NIAGA HOLDINGS BERHAD 038

45 ANNUAL REPORT 2009 YBHG TAN SRI DATO AHMAD FUZI HAJI ABDUL RAZAK AGED 61, MALAYSIAN INDEPENDENT NON-EXECUTIVE DIRECTOR OF PNHB YBhg Tan Sri Dato Ahmad Fuzi Haji Abdul Razak was appointed to the Board of PNHB on 6 October 2008 as an Independent Non-Executive Director. He is a member of PNHB s Audit Committee and Chairman of PNHB s Remuneration Committee and Nomination Committee. He holds a Bachelor of Arts Degree (Honours) from the University of Malaya (1972) and a Certificate in Diplomacy (Foreign Service Course) from the University of Oxford (1974). In recognition of his service to the nation, he was awarded the AMN (1979), the JSM (1999), the DSPN (1999), the DMPN (2002) and the PSM (2003). Since joining the Malaysian Diplomatic and Administrative Service in 1972, YBhg Tan Sri Dato Ahmad Fuzi served in various capacities at the Ministry of Foreign Affairs, mainly in the Political Division, and at the Malaysian Missions abroad in Moscow, the Hague, Canberra, Washington and Dhaka. As Secretary General, he played a prominent role in organising the Non Aligned Movement (NAM) Summit (2003), the Organisation of the Islamic Conference (OIC) Summit (2003) and the ASEAN Summit and Related Summits including the East Asia Summit in Kuala Lumpur (2005). YBhg Tan Sri Dato Ahmad Fuzi had previously served on the Boards of BERNAMA, PROTON, LCL Corporation Berhad, the Malaysian-Thailand Joint Authority (MTJA) and the Maritime Institute of Malaysia (MIMA). He was also on the panel of the Board of Advisors of the Institute of Diplomacy and Foreign Relations (IDFR). He had also previously served as Director General, Institute of Diplomacy and Foreign Relations Malaysia, Ambassador at- Large and Malaysia s Representative to the ASEAN High Level Task Force (HLTF) on the Drafting of the ASEAN Charter and Malaysia s Representative to the High Level Panel (HLP) on the Drafting of the Terms of Reference of the ASEAN Human Rights Body. He was a member of the Board of Trustee of World Islamic Economic Forum (WIEF), International Advisory Panel (lap) of WIEF, Chairman of AmanahRaya Capital Group Sdn Bhd and Chairman, Al-Nibras Limited. YBhg Tan Sri Dato Ahmad Fuzi is currently the Secretary General of the World Islamic Economi Forum Foundation (WIEF), Chairman, Amanahraya-REIT, Chairman, Seremban Engineering Berhad, Executive Chairman, Asia EP Bhd, and Chairman, Islamic Retail Management Fund. He is also a Member of the Board of Trustees of F3 Strategies Berhad, a Member of the Board of Trustee of MERCY, Malaysia, Advisor, The Guide to Malaysia Series, Member of the Advisory Board, Asia Pacific Entrepreneurship Award (APEA), Distinguished Fellow, Institute of Diplomacy and Foreign Relations, Member, Advisory Council of the Alliance Foundation, a Distinguished Fellow, Institute of Strategic and International Studies (ISIS), an Advisor of High School Bukit Mertajam Alumni Malaysia, President of the Association of Former Malaysian Ambassadors (AFMA) and Deputy Chairman, Malaysian Member Committee of the Council for Security Cooperation in the Asia Pacific (CSCAP Malaysia). YBhg Tan Sri Dato Ahmad Fuzi attended 6 out of the 6 Board Meetings of PNHB held in the financial year ended 31 December PUNCAK NIAGA HOLDINGS BERHAD 039

46 0 BOARD OF DIRECTORS PROFILE ANNUAL REPORT 2009 MR NG WAH TAR AGED 46, MALAYSIAN EXECUTIVE DIRECTOR, FINANCE DIVISION OF PNHB AND PNSB Mr Ng Wah Tar was appointed to the Board of PNHB and PNSB on 1 January 2010 as the Executive Director, Finance Division. He was also appointed as a Member of PNHB s Remuneration Committee and the Compliance, Internal Control and Risk Policy Committee ( CICR ) and SYABAS Audit Committee, on 1 January 2010 respectively. He is a member of the Water Association of Selangor, Kuala Lumpur and Putrajaya (SWAn), a non-profit organisation which represents the common interest of all water supply and wastewater industries within the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya with the aim of promoting interaction with the general public, and enhancing their understanding of the water resources. Mr Ng has more than 23 years of working experience in various areas covering auditing, accounting, finance and corporate finance. He commenced his articleship with an accounting firm in 1984 and is a member of the Malaysian Institute of Accountants (MIA), The Malaysian Institute of Certified Public Accountants (MICPA) and Certified Public Accountant (CPA) Australia. He had previously worked with United Engineers (M) Berhad ( UEM ) from 1994 to 2000 under the Management Services Divisions overseeing the finance and accounting functions of UEM. In March 2000, Mr Ng joined PNSB as General Manager, Finance & Accounts and was promoted twice to Senior General Manager, Finance & Accounts on 1 April 2006 and the Executive Director, Corporate Finance under the Executive Chairman s Office on 1 April 2007 respectively. He left PNSB on 1 September 2007 to assume the position of Executive Vice Chairman of WWE Holdings Bhd till 30 June Mr Ng resigned as the Executive Vice Chairman of WWE Holdings Bhd and rejoined PNHB Group on 1 July 2009 as PNSB s Executive Director, Corporate Finance before assuming his current position as PNHB and PNSB s Executive Director, Finance Division. Mr Ng did not attend any Board Meetings of PNHB in the financial year ended 31 December 2009 as he was only appointed to the Board of PNHB on 1 January PUNCAK NIAGA HOLDINGS BERHAD 040

47 BOARD OF DIRECTORS ANNUAL REPORT YBhg Tan Sri Rozali Ismail Executive Chairman 02 YBhg Dato Hashim Mahfar Managing Director 03 YBhg Dato Ruslan Hassan Non-Independent Non-Executive Director 04 YBhg Dato Ir Lee Miang Koi Non-Independent Non-Executive Director 05 YBhg Dato Syed Danial Syed Ariffin Chief Operating Officer 06 YBhg Tan Sri Dato Hari Narayanan Govindasamy Independent Non-Executive Director 07 YBhg Tan Sri Dato Seri Dr Ting Chew Peh Independent Non-Executive Director 08 YAM Tengku Dato Rahimah Almarhum Sultan Mahmud Non-Independent Non-Executive Director 09 YBhg Tan Sri Dato Ahmad Fuzi Haji Abdul Razak Independent Non-Executive Director 10 Mr Ng Wah Tar Executive Director, Finance Division PUNCAK NIAGA HOLDINGS BERHAD 041

48 KEY PERSONNEL PROFILE - PNSB ANNUAL REPORT 2009 YBHG DATO NASIR KHAN ILLADAD KHAN AGED 57, MALAYSIAN EXECUTIVE DIRECTOR, BUSINESS DEVELOPMENT DIVISION YBhg Dato Nasir Khan Illadad Khan joined PNSB on 21 February 2006 as the Executive Director, Corporate Affairs Division before assuming his current position as the Executive Director, Business Development Division on 1 January He holds a Bachelor s Degree in Social Science, Political Science (Hons) from the Universiti Sains Malaysia and a Master s Degree in Public Administration from the Pennsylvania State University, United States of America. He also possesses a Diploma in Public Management from the National Institute of Public Administration (INTAN), and attended an Executive Management Programme at the School of Government, Harvard University, United States of America. YBhg Dato Nasir Khan has more than 31 years of management experience with the Government, holding various positions and covering areas of human resources, security, land development and finance. Prior to joining PNSB, he was the Senior Assistant Director, Budget Division at the Ministry of Finance, Malaysia. YBHG DATUK MOHD YUNUS MOHD AMIN AGED 62, MALAYSIAN EXECUTIVE DIRECTOR, HUMAN RESOURCES AND ADMINISTRATION DIVISION YBhg Datuk Mohd Yunus Mohd Amin joined PNSB on 15 November 2007, as Executive Director, Human Resources & Administration Division. He holds a Degree in Mass Communications from Universitas Padjajaran Bandung, Indonesia and a Diploma in Public Management from the National Institute of Public Administration (INTAN). Prior to joining PNSB, he was the Director for Bahagian Geraksaraf Dan Perancangan Dasar, Jabatan Hal Ehwal Khas of the Ministry of Information, Malaysia. YBhg Datuk Mohd Yunus has more than 31 years of management experience during his tenure with the Government, inclusive of 27 years of experience as Diplomatic Service Officer. MADAM TAN BEE LIAN AGED 44, MALAYSIAN EXECUTIVE DIRECTOR, CORPORATE SERVICES DIVISION Madam Tan Bee Lian joined PNSB as Company Secretary in 7 November 1994 and was promoted thrice before assuming her current position as Executive Director, Corporate Services Division on 1 January 2010, overseeing the Secretarial Department, Legal Department and Strategic Resource Centre. As Group Company Secretary, Madam Tan is responsible for PNHB Group s company secretarial and regulatory compliance. On 27 June 2008, she was appointed as a Director of Sino Water Pte Ltd (Sino Water). Madam Tan is a Fellow of the Malaysian Association of the Institute of Chartered Secretaries and Administrators (MAICSA) and has more than 22 years of working experience in company secretarial practice and corporate work. She had previously worked with Projek Lebuhraya Utara-Selatan Berhad (PLUS) and Metramac Corporation Sdn Bhd/Metacorp Berhad. She is also the winner of the ROC-MAICSA Company Secretary Award 2001 for the Listed Company Category. IR TAN HUI KUAN AGED 56, MALAYSIAN EXECUTIVE DIRECTOR, OPERATION & MAINTENANCE DIVISION Ir Tan Hui Kuan joined PNSB in 20 January 2003 and assumed his current position as the Executive Director, Operation & Maintenance Division on 1 January He graduated with a Bachelor s Degree (Hons) in Civil Engineering from the University of Malaya in He has 26 years of working experience in the Public Works Department Malaysia and Lembaga Air Perak in the management of production, distribution, maintenance and consumer services of a District Waterworks Department, geotechnical investigation, maintenance of military camps, project management of military buildings and infrastructures. Prior to joining PNSB, Ir Tan was the Assistant Director for Military Works in the Public Works Department Malaysia. While in PNSB, he had successfully executed and completed the Chennai Water Supply Augmentation Project 1, Package III implemented by Chennai Metropolitan Water Supply and Sewerage Board in Tamil Nadu, India. PUNCAK NIAGA HOLDINGS BERHAD 042

49 ANNUAL REPORT 2009 IR OOI CHENG SWEE AGED 57, MALAYSIAN EXECUTIVE DIRECTOR, ENGINEERING/PROJECT DEVELOPMENT DIVISION Ir Ooi Cheng Swee joined PNSB in 1 January 2005 as General Manager and was promoted to Senior General Manager on 1 January Ir Ooi was subsequently appointed as a Director of Sino Water Pte Ltd (Sino Water) and the Managing Director of Sino Water on 5 June 2008 and 26 June 2008, respectively where he oversee the China Operations effective 1 July He assumed his current position as the Executive Director, Engineering/Project Development Division on 1 January Ir Ooi graduated with a Bachelor of Engineering (Civil) (Hons) Degree from the University of Malaya in He has 32 years of working experience in infrastructure works, drainage, road and bridge engineering design, construction supervision of water supply schemes, water supply distribution study and operations of water treatment plants. He is a Professional Engineer registered with the Board of Engineers Malaysia and a member of the Institution of Engineers Malaysia. Prior to joining PNSB, he was the General Manager (Maintenance & Project) of CGE Utilities (M) Sdn Bhd. YBHG DATUK DR MUZAHET MASRURI AGED 58, MALAYSIAN SENIOR GENERAL MANAGER, STRATEGIC RESOURCE CENTRE, CORPORATE SERVICES DIVISION YBhg Datuk Dr Muzahet Masruri joined PNSB on 1 January 2010 as Senior General Manager, Strategic Resource Centre, Corporate Services Division. He has 33 years of working experience in economics research, planning and management during his tenure with the Government. Prior to joining PNSB, he was the Deputy Director General 1 in the Economic Planning Unit, Prime Minister s Department. He held various positions, i.e. Secretary General in the Ministry of Unity, Culture, Arts & Heritage, Deputy Secretary General in the Ministry of Domestic Trade & Consumer Affairs (now known as Ministry of Domestic Trade, Co-Operative and Consumerism), Deputy Head of Secretariat in the National Economic Action Council [now known as National Economic Advisory Council (NEAC)], Senior Assistant Director (Center for Policy Analysis) in the Socioeconomic Research Unit, Prime Minister s Department, and Editor in Dewan Bahasa dan Pustaka. He holds a Doctorate in Economics and Masters in Development Economics, both from the University of East Anglia, United Kingdom. He obtained his Bachelor of Arts Degree from the University of Malaya and Diploma in Teaching from Sultan Idris Teachers Training College, Tanjung Malim, Perak. Some of his major involvements were in the preparation of the Five-Year Malaysia Development Plan, managing the Financial Crisis, 2001 Economic Crisis, Influenza Bird Flu 2003, and development of domestic trade industries such as hypermarket, petroleum & gas, and fair trade practices policy. MADAM LIM YEW HEANG AGED 43, MALAYSIAN GENERAL MANAGER, SECRETARIAL DEPARTMENT, CORPORATE SERVICES DIVISION Madam Lim Yew Heang (Jenny) joined PNSB on 1 April 2008 as General Manager, Secretarial Department, Corporate Services Division. She was appointed as the Joint Company Secretary for both PNSB and PNHB on 2 May She is a Chartered Secretary, a holder of the Institute of Chartered Secretaries & Administrators (ICSA) qualification and an Associate Member of The Malaysian Institute of Chartered Secretaries and Administrators (MAICSA). She has 21 years of working experience in company secretarial practice. Prior to joining PNSB, she was a Senior Manager of Securities Services (Holdings) Sdn Bhd, a leading secretarial consultancy company for 14 years. PUNCAK NIAGA HOLDINGS BERHAD 043

50 KEY PERSONNEL PROFILE - PNSB ANNUAL REPORT 2009 ENCIK HALMAR HASINA WIJAYA MUHAMMAD ISA AGED 50, MALAYSIAN GENERAL MANAGER, HUMAN RESOURCES & ADMINISTRATION DIVISION Encik Halmar Hasina Wijaya Muhammad Isa joined PNSB on 16 December 2009, as General Manager, Human Resources & Administration Division. He holds a Master of Business Administration from Akamai University, USA and a Bachelor Degree in Human Resources Management from Connaught University, Ireland. Encik Halmar Hasina Wijaya has more than 28 years of working experience in the fields of human resource management and administration. He has been in a senior management position for over 15 years and had played a pivotal role in providing strategic advice to the top management especially on human capital development and industrial relations issues. Prior to joining PNSB, he was with Hitachi and Dipsol of which both are Japanese multinational companies for 8 years and 3 years respectively, as a Human Resource Consultant. He was also attached with APM Automotive Holdings Berhad for 17 years as Head of Group, HR & Administration. Throughout his career, he has good exposure in public listed company and several multinational companies with unionised environment. PUAN HAFIZAH AHMAT AGED 41, MALAYSIAN GENERAL MANAGER, CONTRACT & PROCUREMENT DEPARTMENT, MANAGING DIRECTOR S OFFICE Puan Hafizah Ahmat joined PNSB on 4 January 2010 as General Manager, Contract & Procurement Department. She graduated with an Advanced Diploma in Quantity Surveying from the Universiti Teknologi MARA and was bestowed the Best Student Award in Puan Hafizah Ahmat has 18 years of working experience in quantity surveying works. She worked in a QS Consultant Company in July 1992 as a Quantity Surveyor for three years. Prior to joining PNSB, Puan Hafizah was attached with a construction company for 14 years. ENCIK ZULBAHARI ABU BAKAR AGED 42, MALAYSIAN GENERAL MANAGER, BUSINESS DEVELOPMENT DIVISION Encik Zulbahari Abu Bakar joined PNSB on 15 February 2010 as General Manager, Business Development Division. He graduated with a Bachelor s Degree in Engineering from the University of Tasmania, Australia in He had 19 years of working experience in the field of Project, Contract & Cost and Construction Management in various Civil and Building Construction projects, both locally and internationally. Prior to joining PNSB, he was a Project Director for public listed construction company and had sucessfully completed prestigious projects such as Musrif Reservoirs (2 units of 45 mil Gallon capacity) in Dubai; Roads, Bridges and Infrastructure for the Public Works Department (JKR) and Federal Administrative Capital, Putrajaya; Affordable homes in Republic of Senegal and High Rise police quarters for Malaysian Royal Police, the study of water reticulation network in the Republic of Serbia, proposed railway construction in the Islamic Republic of Iran (CIDB Consortium) and many more. MS POH KHANG MEI AGED 39, MALAYSIAN GENERAL MANAGER, FINANCE & ACCOUNTS DEPARTMENT, FINANCE DIVISION Ms Poh Khang Mei joined PNSB as General Manager, Finance & Accounts Department on 1 April Ms Poh graduated with a Degree in Bachelor of Business (Accountancy) from the Royal Melbourne Institute of Technology (Australia) in She is a member of the Malaysian Institute of Accountants (MIA) and Australian Society of Certified Practicing Accountant (ASCPA), having more than 15 years of working experience in auditing, accounting and corporate taxation. Ms Poh had previously served at senior management level in several public listed companies dealing in manufacturing, trading and investments. PUNCAK NIAGA HOLDINGS BERHAD 044

51 KEY PERSONNEL PROFILE - SYABAS ANNUAL REPORT 2009 IR V SUBRAMANIAM AGED 60, MALAYSIAN EXECUTIVE DIRECTOR, STRATEGIC RESOURCES DIVISION Ir V Subramaniam is presently the Executive Director, Strategic Resources Division of Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS). He has worked with the Selangor Water Works Department (JBAS) since 1991 and continued his services with the Selangor Water Management Corporation (PUAS) when the Water Works Department was corporatised in March 2002 and subsequently with SYABAS as the Executive Director, Operations when the water supply in Selangor and Federal Territories of Kuala Lumpur and Putrajaya was privatised on 1 January He holds a Bachelor of Civil Engineering (Hons) Degree from the University of Malaya. Ir V Subramaniam has served in the Public Works Department and Water Supply Department, in various capacities for the past 36 years since graduating in He has vast experience in managing water supply and in the privatisation of water supply. Ir V Subramaniam successfully handled the 1998 Water Crisis in Selangor and Kuala Lumpur, then as the Deputy Director of the Selangor Water Works Department and published a complete documentation on the management of the water crisis. He has written and presented many papers on Privatisation/Corporatisation of water supply and on other related technical subjects at both overseas and local seminars and conferences. He has also assisted the Asian Development Bank (ADB) in his capacity as ADB s domestic consultant, in several studies on water supply in Asian cities. Ir V Subramaniam was awarded the Darjah Kebesaran Setia Makhkota Selangor (SMS), Darjah Kebesaran Setia-Sultan Salahuddin Abdul Aziz Shah (SSA), Ahli Mangku Negara (AMN) and Pingat Jasa Kebaktian (PJK) (Terengganu), for his dedication and service to the State and the nation. MADAM THEIN KWEE SIM AGED 46, MALAYSIAN EXECUTIVE DIRECTOR, FINANCE DIVISION Madam Thein holds a professional qualification from the Malaysian Institute of Certified Public Accountants (MICPA) and has been a member of MICPA and Malaysian Institute of Accountants (MIA) since Madam Thein has more than 22 years of working experience in various areas covering auditing, group accounting, corporate debt restructuring and corporate finance. Prior to joining SYABAS, Madam Thein was with the Renong Group of Companies for a total of 7 1/2 years where she served in United Engineers (Malaysia) Berhad ( ) overseeing the group finance and accounting functions and HBN Management Office ( ) where her role was to monitor the financial performance of the listed companies under the Renong Group in addition to the debt restructuring of several companies under the Renong Group subsequent to the financial crisis of In early 2000, she joined Jendela Permai Sdn Bhd, a financial consultancy company prior to joining SYABAS in May Her appointment as Executive Director of Finance was with effect from 1 April ENCIK OTHMAN ISMAIL AGED 52, MALAYSIAN EXECUTIVE DIRECTOR, EXECUTIVE CHAIRMAN S OFFICE Encik Othman Ismail joined PNSB in April 2004 as General Manager and was promoted to Senior General Manager, Executive Chairman s Office on 1 April 2006 before assuming his current position as the Executive Director, Government Relations of SYABAS under the Executive Chairman s Office on 1 April He graduated from the University of Wales, United Kingdom in 1999 with a Master s Degree in Business Administration. Encik Othman has 17 years of working experience covering areas in marketing, sales and administration. Prior to joining PNSB, Encik Othman worked with Edaran Otomobil Nasional Berhad and was the Operations Director of Gold Bridge Construction and Engineering Berhad. PUNCAK NIAGA HOLDINGS BERHAD 045

52 KEY PERSONNEL PROFILE - SYABAS ANNUAL REPORT 2009 ENCIK SANUSI SULIEMAN AGED 49, MALAYSIAN EXECUTIVE DIRECTOR, PROJECT DIVISION Encik Sanusi Sulieman graduated with a Second Class Upper Degree in Civil Engineering from the University of Malaya in 1984, after which he started his career with the Penang Water Authority in 1984 holding various positions of Project Engineer, Treatment Engineer and Distribution Engineer until In 1993, he joined a consulting engineering firm, Ranhill Bersekutu Sdn Bhd as a Senior Engineer involved in the Johor Baharu Water Supplies Privatisation Scheme. In 1994, he joined PNSB and was appointed as the Project Manager for the RM1.3 billion Sungai Selangor Phase 2 Water Supply Scheme which involved the construction of the Sungai Selangor Phase 2 Water Treatment Plant and its distribution system. In 2000, he joined Ranhill Engineers and Contractors Sdn Bhd as the Project Director in charge of all water supply construction activities at the company. He was then promoted to Chief Operating Officer of Ranhill Civil Sdn Bhd until In 2004, he joined as the Executive Director of WWE Holdings Bhd before joining PNSB in the same year and was involved in the task force for the privatisation of PUAS to SYABAS. Encik Sanusi was exposed to international construction works when he was assigned to the SR408 million North Jeddah Branch Sewer Network Project in the Kingdom of Saudi Arabia in 2006 before he was assigned to the position of Executive Director (Project) in SYABAS since August TUAN HAJI ZAINUDDIN OTHMAN AGED 50, MALAYSIAN EXECUTIVE DIRECTOR, HUMAN RESOURCES & ADMINISTRATION DIVISION Tuan Haji Zainuddin Othman joined SYABAS on 1 April 2005 as General Manager, Human Resources & Administration Division. He holds a Diploma in Public Administration from the Universiti Teknologi MARA (UiTM), a Post Graduate Diploma and a Master of Science in Human Resource Management Degree from the University of Lincolnshire and Humberside, United Kingdom. He has more than 23 years of working experience in the areas of human resources management and general office administration. He was promoted to Senior General Manager of the Human Resources & Administration Division with effect from 1 January 2007 and is currently the Executive Director, Human Resources & Administration of SYABAS since 1 January ENCIK ABDUL HALEM HAJI MAT SOM AGED 44, MALAYSIAN EXECUTIVE DIRECTOR, CORPORATE AFFAIRS DIVISION Encik Abdul Halem Haji Mat Som joined PNSB in 2004 as the Personal Assistant to the Executive Chairman before he was assigned to SYABAS as Senior Manager, Corporate Communications and Public Affairs Department (CCPA) and subsequently promoted to General Manager, CCPA on 1 January He was promoted to Executive Director, Corporate Affairs Division on 1 January He holds a Diploma in Public Administration (1987) and a Bachelor s Degree in Corporate Administration (1998), both from UiTM, and a Certificate in Manufacturing Management from the Sanno Institute of Business Administration (SIBA), Tokyo (1990). Prior to joining PNSB, Encik Abdul Halem was the Group Managing Director of Eeman Group of Companies, which dealt in manufacturing, trading, event consultancy advertising and production. Encik Abdul Halem has more than 20 years experience in the areas of event management, film production, advertising, manufacturing, human resource consultancy and training, administration and capital investment. PUNCAK NIAGA HOLDINGS BERHAD 046

53 ANNUAL REPORT 2009 TUAN HAJI MUHAMAD DARIF HAJI IDRIS AGED 55, MALAYSIAN SENIOR GENERAL MANAGER, OPERATION & MAINTENANCE DIVISION Tuan Haji Muhamad Darif Haji Idris holds a Bachelor of Science (Engineering) (Hons) Degree from the University of Aberdeen, Scotland and an Ordinary National Diploma (Building) from the Southampton Technical College, England. He has 30 years working experience in public works and water supply sector. Tuan Haji Muhamad Darif began his career as a Civil Engineer at the Jabatan Kerja Raya (JKR) Tampin District. He was then transferred to JBAS as a District Waterworks Engineer at the Hulu Langat District followed by various stints at Petaling District, JBAS Headquarters, Gombak District. He continued his service with PUAS from 2002 to 2004 as Senior Manager, Operation Division. Prior to assuming his position as General Manager of SYABAS Klang District Office from April 2007 till March 2009, he was the General Manager of SYABAS Petaling District Office. With effect from 1 April 2009, he was appointed to the current position of Senior General Manager, Operation & Maintenance Division at SYABAS Headquarters. ENCIK ISMAIL RUSMIN AGED 40, MALAYSIAN SENIOR GENERAL MANAGER, DISTRICT DEPARTMENT Encik Ismail Rusmin holds a Diploma in Business Studies from Institut Teknologi MARA and an Advanced Diploma in Business Administration from Swansea Institute of Higher Education, United Kingdom. He joined PNSB as Operations Executive in In 2003, he was placed under SYABAS Special Project Team as a Manager during the privatisation process of water supply in the State of Selangor, and Federal Territories of Kuala Lumpur and Putrajaya. In 2006, he was promoted to Assistant General Manager to head the Operational Audit & Special Function Division. Subsequently, he was promoted to Senior General Manager, District Department to supervise the Enforcement Department, Security Department and the operational activities of ten (10) SYABAS District Offices around the concession areas as well as the Secretaries of Work (SOW). TUAN HAJI MOHD SUHAIMI RAFIE AGED 54, MALAYSIAN SENIOR GENERAL MANAGER, INFORMATION & COMMUNICATIONS TECHNOLOGY DEPARTMENT Tuan Haji Mohd Suhaimi Rafie holds a Diploma and a Advanced Diploma in Civil Engineering and a Post Graduate Diploma in Systems Analysis from UiTM. He has 28 years of working experience in public works and the water supply sector. He began his career in 1979 as a Civil Engineer with JKR, holding various positions until Thereafter, he joined JBAS as a Civil Engineer and continued his service under PUAS from 2002 to He was the General Manager, Information & Communications Technology Department before he was promoted to Senior General Manager, Information & Communications Technology Department on 1 January PUNCAK NIAGA HOLDINGS BERHAD 047

54 KEY PERSONNEL PROFILE - SYABAS ANNUAL REPORT 2009 TUAN HAJI SONARI SOLOR AGED 54, MALAYSIAN SENIOR GENERAL MANAGER, INTERNAL AUDIT Tuan Haji Sonari Solor joined PNSB on 10 September He is a Chartered Accountant with the Malaysian Institute of Accountants and a Fellow Member of the Chartered Association of Certified Accountants (U.K). He also holds a professional qualification from the Chartered Institute of Management Accountants (UK). Tuan Haji Sonari Solor has more than 21 years of working experience at the managerial level in the area of accounting and auditing with several public listed companies, with focus on asset development of manufacturing companies, logging, and management consultancy. Prior to joining PNSB, Tuan Haji Sonari held the position of Group Division Head, Internal Audit with Land & General Berhad. TUAN HAJI YUSOF SAROJI AGED 44, MALAYSIAN GENERAL MANAGER, OPERATION & MAINTENANCE DEPARTMENT Tuan Haji Yusof Saroji holds a Diploma and Advanced Diploma in Civil Engineering from UiTM. He has 22 years of working experience in the water supply sector. He began his career in 1988 as a Technical Assistant with JBAS and continued his service with PUAS from 2002 to 2004 as Senior Manager of Kuala Selangor / Sabak Bernam District Office. He is now the General Manager, Operation & Maintenance Division HQ. IR NASIR ISMAIL AGED 47, MALAYSIAN GENERAL MANAGER, CONTRACT & PROCUREMENT DEPARTMENT Ir Nasir Ismail is a member of the Board of Engineer (BEM), MWA, SWAn, IWA and is a Registered Gas Engineer with the Energy Commission, Ministry of Energy, Green Technology and Water (formerly known as Ministry of Energy, Water and Communications). He holds a Bachelor of Science in Civil Engineering Degree from the Memphis State University, Tennessee, USA and a Master of Science in Environmental Engineering from Shimane University, Japan in Prior to joining SYABAS, Ir Nasir was one of the task force members for the privatisation of SYABAS and has served PNSB since 1998 as a Senior Manager responsible for the upgrading and rehabilitation of water treatment plants under the Concession Agreement with the State Government of Selangor. Currently, Ir Nasir is the General Manager of the Contract & Procurement Department in SYABAS. He had previously worked with Majlis Perbandaran Seremban, consulting engineer firms, contractors and Gas Malaysia Sdn Bhd. PUAN ADELINA ISKANDAR AGED 49, MALAYSIAN GENERAL MANAGER, CUSTOMER SERVICE DEPARTMENT Puan Adelina Iskandar joined SYABAS on 1 August 2007 as General Manager, Customer Service Division, seeing to the needs of 7.3 million consumers. Puan Adelina has more than 22 years experience in public relations and training. She holds a Degree in Humanities and a Masters in Linguistics. Puan Adelina had served as Director, Corporate Communications of the Malaysian Communications and Multimedia Commission where she was responsible for all matters pertaining to the media, government and public relations as well as overall strategy of the branding and image building of the commission. Prior to that she was with the Association of Chartered Certified Accountants where she was responsible for members relations as well as corporate communications. Puan Adelina was also in the education field for 10 years as the Director of a University Preparatory Programme with an American twinning programme here. At SYABAS, Puan Adelina is part of the Corporate Social Responsibility (CSR) Committee, Business Ethics Committee and the Sexual Harassment Committee. PUNCAK NIAGA HOLDINGS BERHAD 048

55 ANNUAL REPORT 2009 MADAM CHONG POH LENG AGED 40, MALAYSIAN SENIOR GENERAL MANAGER, FINANCE & ACCOUNTS DEPARTMENT Madam Chong Poh Leng joined SYABAS in April 2008 as General Manager, Finance & Accounts of SYABAS. She was promoted to Senior General Manager, Finance & Accounts of SYABAS on 1 January Madam Chong graduated with a Bachelor s Degree in Accountancy from the University of Malaya in She is a member of MIA, having more than 15 years of working experience in auditing, corporate finance, corporate restructuring, accounting and corporate taxation. Madam Chong previously served at the senior management level of several public listed companies dealing in property development, project management, construction and manufacturing including TRIplc Berhad. PUAN ROOWINA MERICAN A RAHIM MERICAN AGED 48, MALAYSIAN SENIOR GENERAL MANAGER, WATER QUALITY DEPARTMENT Puan Roowina Merican A Rahim Merican joined PNSB on 22 March 1997 as a Manager in the Operations Division responsible for the Environmental Unit. She was subsequently promoted to Senior Manager, Assistant General Manager and General Manager of the Water Resources and Environmental Surveillance Department in PNSB before assuming her current position as the Senior General Manager of the Water Quality Department under the Strategic Resources Division in SYABAS. She graduated with a Bachelor of Science Degree (Hons) in Civil Engineering from the University of Surrey in 1984 and subsequently obtained her Master of Engineering Degree in Water Resources Development (Hons) in She began her career in 1985 as a Civil Engineer with the Public Works Department (PWD) Malaysia and held various positions during her tenure with PWD until PUAN NIK ALIENA SALWANEE NIK MOHAMED AGED 47, MALAYSIAN GENERAL MANAGER, LEGAL & ENFORCEMENT DEPARTMENT Puan Nik Aliena Salwance Nik Mohamed is the General Manager of the Legal & Enforcement Department of SYABAS. She joined SYABAS on 1 August She is a barrister-at-law of the Honorable Society of Lincoln s Inn, London, England and holds a Bachelor of Laws (Hons.) Degree from Middlesex University, London, England. She also holds a Master of Laws Degree from King s College, University of London. Since graduating in 1986, she has worked in both legal practice and corporate advisory having practiced for eight years as an advocate and solicitor and spent nine years as the Head of the Legal and Secretarial Department and Company Secretary of PROTON Holdings Berhad. MR ALBERT LOH THIAM HOCK AGED 56, MALAYSIAN GENERAL MANAGER, NON-REVENUE WATER DEPARTMENT Mr Albert Loh, who joined SYABAS on 14 February 2005 as a Leak Detection Specialist, is now the General Manager of Non-Revenue Water Division. He graduated with a Bachelor of Science Degree (Hons) from University Sains Malaysia in 1978 majoring in Geophysics. Prior to working with SYABAS, he was employed by an engineering company in Melbourne undertaking water resource investigation, pipe condition assessment and leak detection services in Australia. He had also worked with Geological Survey of Malaysia from 1979 to 1981 and Malaysia Mining Corporation Bhd from 1981 to 1997 in exploration & mining, oil & gas and utility projects, both locally and overseas. PUNCAK NIAGA HOLDINGS BERHAD 049

56 KEY PERSONNEL PROFILE - SYABAS ANNUAL REPORT 2009 ENCIK SHAHRUDDIN AB RAHMAN AGED 46, MALAYSIAN GENERAL MANAGER, BILLING AND RECOVERY DEPARTMENT Encik Shahruddin joined SYABAS on 1 July 2009 as the General Manager, Billing and Recovery Department. He holds a Bachelor in Accounting (Advanced Diploma in Accounting) from UiTM. Prior to joining SYABAS, he served Telekom Malaysia Berhad (TM) for 22 years with various Divisions and Subsidiary Companies of TM. He was the Chief Financial Officer for two TM subsidiary Companies, namely GITN Sdn Bhd and TM Payphone Sdn Bhd. He was also involved with the spun off of a few of TM Division into full subsidiary of TM such as TM Research Sdn Bhd and TM Payphone Sdn Bhd. He was also involved with the take over of GITN Sdn Bhd being the subsidiary Company of PNB Berhad to be full subsidiary of TM. His last project with TM was as the Business Controller for the Malaysian Emergency Response System 999 project where TM was appointed by the Ministry of Energy, Water and Communications (now known as Ministry of Energy, Green Technology and Water) to develop and maintain the system which will provide emergency facilities to the public. IR AHMAD MARZUKI HASHIM AGED 48, MALAYSIAN GENERAL MANAGER, CHIEF OPERATING OFFICER S OFFICE Ir Ahmad Marzuki Hashim graduated with a Bachelor of Science Degree in Civil Engineering (Hons) from Ohio University in Athens in 1984 and Master of Science Degree in Environmental Civil Engineering from the University of Liverpool, England in He is a civil engineer by profession and has been with PNSB since March He began his career with PNSB as a Manager of the Dam Operation Department and was subsequently promoted to the positions of Senior Manager and Assistant General Manager before assuming his position as General Manager of the Business Development Department. He then joined SYABAS as General Manager in the Chief Operating Officer s Office in August Ir Ahmad Marzuki has more than 26 years experience in the water industry and has held various positions during his tenure with the Public Works Department s Waterworks Branch. IR DR TEOH SENG GIAP AGED 44, MALAYSIAN GENERAL MANAGER, NETWORK AND INSTRUMENTATION DEPARTMENT Ir Dr Teoh Seng Giap graduated with Bachelor of Engineering (Hons) and Doctor of Philosophy (Engineering) from the University of Western Australia in 1989 and 1995 respectively. He has 13 years of working experience with established engineering consulting firms holding various positions. Ir Dr Teoh has participated in civil engineering design development, contract documentation and administration, project management, proposal and concept paper preparation, and project procurement. He has played key roles in projects involving hydraulic modelling, river engineering and flood mitigation. Ir Dr Teoh was an Associate Director at Sepakat Setia Perunding Sdn Bhd and actively involved in inception, design and implementation of Stormwater Management and Road Tunnel (SMART) Project. He joined PNSB on 1 April 2008 as General Manager (Hydrology & Hydraulics) at the Chief Operating Officer s Office. On 1 January 2010, he assumed the position as SYABAS General Manager of Network and Instrumentation Department. He is a Professional Engineer registered with the Board of Engineers Malaysia and a member of the Institution of Engineers Malaysia. PUNCAK NIAGA HOLDINGS BERHAD 050

57 KEY PERSONNEL PROFILE - SINO WATER PTE LTD ANNUAL REPORT 2009 YBHG DATO SYED DANIAL SYED ARIFFIN AGED 52, MALAYSIAN CHAIRMAN, SINO WATER PTE LTD YBhg Dato Syed Danial Syed Ariffin was appointed to the Board of Sino Water Pte Ltd (Sino Water) and as the Chairman of Sino Water on 1 January 2010 respectively. He is the Chief Operating Officer of PNHB and PNSB. YBhg Dato Syed Danial is a civil engineer by profession and has been with the PNHB Group since December He holds a BSc (Hons) Degree in Civil Engineering from the University of Aston in Birmingham, United Kingdom. As Chairman of Sino Water Pte Ltd, YBhg Dato Syed Danial Syed Ariffin is responsible for the stewardship of the Board of Sino Water and its subsidiaries in the People s Republic of China. The full details of YBhg Dato Syed Danial s profile are as detailed in page 035 of this Annual Report. IR OOI CHENG SWEE AGED 57, MALAYSIAN MANAGING DIRECTOR, SINO WATER PTE LTD Ir Ooi Cheng Swee was appointed to the Board of Sino Water Pte Ltd (Sino Water) on 5 June He was subsequently appointed as the Managing Director of Sino Water on 26 June 2008 and is based in Shanghai, in the People s Republic of China. He is the Executive Director, Engineering/Project Development Division of PNSB. Ir Ooi is a civil engineer by profession and holds a Bachelor of Engineering (Civil) (Hons) Degree from the University of Malaya. As the Managing Director of Sino Water, Ir Ooi is responsible for the day-to-day management, operations and project implementation of all projects undertaken in the People s Republic of China including identifying potential projects, liaisons with the regulatory authorities and provincial heads of the respective government bureaus. The full details of Ir Ooi Cheng Swee s profile are as detailed in page 043 of this Annual Report. PUNCAK NIAGA HOLDINGS BERHAD 051

58 FIVE-YEAR FINANCIAL HIGHLIGHTS ANNUAL REPORT 2009 IN RM DEC DEC DEC DEC DEC 05 RESTATED RESTATED RESTATED KEY RESULTS Revenue 1,887,000 1,415,283 1,388, ,438, ,196,612 + Profit before taxation 312,606 54,879 ^ 113, , ,245 + Net profit attributable to equity holders of the Company 142,320 21,622 ^ 64,184 #+ 297,087 #+ 364,479 #+ BALANCE SHEET Property, plant and equipment 1,521,346 1,560,927 1,526, ,495, ,424,554 * + Prepaid land lease payments 75,895 76,738 77,581 20,128 20,356 * Project development expenditure 3,994,674 3,463,997 ^ 2,411, ,429, ,293 + Other non-current assets 1,167,585 1,287,723 ^ 1,248,470 1,272, ,047 Current assets 1,999,610 1,388,883 1,473, ,233, ,667,241 + Total assets 8,759,110 7,778,268 6,737,240 6,450,812 4,909,491 ISSUED AND PAID-UP CAPITAL Share capital 411, , , , ,180 Reserves 1,062, ,485 ^ 986,094 #+ 1,280,249 #+ 1,076,688 # Equity attributable to equity holders of the Company 1,473,801 1,372,628 1,397,237 1,867,596 1,539,868 Net assets per share attributable to equity holders of the Company (RM) ^ 3.40 # # #+ RATIOS AND STATISTIC Net profit margin attributable to equity holders of the Company (%) 8 2 ^ 5 #+ 21 #+ 30 #+ Basic earnings per share attributable to equity holders of the Company (sen) ^ # # #+** Interest bearing debt (RM 000) 5,376,769 4,784,802 3,760,457 2,923,089 2,423,279 Gearing ratio (times) # # #+ Current ratio (times) * These comparatives have restated following the early adoption of the revised FRS Leases in 2006, which resulted in the reclassification of leasehold land as prepaid lease payments retrospectively. ** These comparatives have been restated to take into account the effects of the bonus issue and consolidation of shares which were part of the Company s Capital Repayment exercise. # These comparatives have been restated to take into account the effects of the adoption of FRS 112: Income Taxes. + These comparatives have been restated to take into account the effects of understatement of trade receivables and retained earnings of prior years due to underrecognition of revenues for prior years. ^ These comparatives have been reclassified to take into account the effect of the purchase price allocation exercise which was undertaken to assess the provisional concession right during the current financial year by the Group under the FRS 3: Business Combinations. PUNCAK NIAGA HOLDINGS BERHAD 052

59 FIVE-YEAR GROUP PERFORMANCE ANNUAL REPORT 2009 REVENUE RM 000 2,000,000 NET PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY RM ,000 EARNINGS PER SHARE Sen , ,500,000 1,000,000 1,196,612 1,438,706 1,388,383 1,415,283 1,887, , , , , , , , ,000 50, ,184 21, , YEAR YEAR YEAR EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY RM 000 2,000,000 TOTAL ASSETS RM ,000,000 NET ASSETS PER SHARE RM ,000,000 1,500,000 1,000, ,000 1,539,868 1,867,596 1,397,237 1,372,628 1,473,801 6,000,000 4,000,000 2,000,000 4,909,491 6,450,812 6,737,240 7,778,268 8,759, YEAR YEAR YEAR PUNCAK NIAGA HOLDINGS BERHAD 053

60 SHARE PRICE & VOLUME TRADED ANNUAL REPORT 2009 SHARE PRICE MOVEMENT JAN FEB MAR APR MAY JUN JUL AUG SEPT OCT NOV DEC JAN FEB MAR APR Volume of Shares 5,164 16,650 4,767 7,974 19,324 35,175 20,832 11,245 6,248 3,829 4,738 5,698 6,561 1,172 12,020 4,720 Traded ( 000) PNHB Monthly Average Closing Prices (RM) FTSE Bursa ,029 1,069 1,113 1,176 1,195 1,241 1,267 1,266 1,278 1,257 1,298 1,337 Malaysia Kuala Lumpur Composite Index (KLCI) Monthly Average Closing Prices SHARE PRICE (RM) KLCI VOLUME OF SHARES TRADED ( 000) JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC JAN FEB MAR APR Volume of Shares Traded PHNB Monthly Average Closing Prices FTSE Bursa Malaysia Kuala Lumpur Composite Index (KLCI) Monthly Average Closing Prices PUNCAK NIAGA HOLDINGS BERHAD 054

61 FINANCIAL CALENDAR ANNUAL REPORT MONDAY 25 MAY 09 First Quarter Results ended 31 March 2009 TUESDAY 25 AUG 09 Second Quarter Results ended 30 June 2009 MONDAY 23 NOV 09 Third Quarter Results ended 30 September THURSDAY 25 FEB 10 Fourth Quarter Results ended 31 December 2009 MONDAY 26 APR 10 Audited Financial Statements for the financial year ended 31 December 2009 TUESDAY 01 JUN 10 Published Annual Report 2009 WEDNESDAY 23 JUN 10 Thirteenth Annual General Meeting WEDNESDAY 14 JUL 10 Entitlement Date for payment of the Final Single Tier Dividend of 10 sen per share for the financial year ended 31 December 2009 TUESDAY 03 AUG 10 Payment Date for the Final Single Tier Dividend of 10 sen per share for the financial year ended 31 December 2009 PUNCAK NIAGA HOLDINGS BERHAD 055

62 MILESTONES ANNUAL REPORT APR JUL MAR JUL Listing on the Main Board of the KLSE (now known as Main Market of Bursa Malaysia Securities Berhad effective 3 August 2009) and launching of Puncak Niaga Holdings Berhad s (PNHB) Homepage. 16 OCT Signing Ceremony of Turnkey Construction Contract between PNSB and Seni Kembara-Hazama- Central Energy-OTV Consortium for the construction of Stage 2 of SSP2 Water Treatment Plant (WTP) JAN PNHB was included in the KLSE Composite Index (now known as FTSE Bursa Malaysia Kuala Lumpur Composite Index). 09 APR Signing Ceremony of the Second Amendment to the Construction Cum Operation Agreement. 01 DEC PNHB was included in the Morgan Stanley Capital International Standard Index APR PNHB received the Certificate of Approval by Lloyd s Register Quality Assurance ISO 9002:1994,EN ISO 9002:1994, BS EN ISO 9002:1994, MS ISO 9002:1994 for Quality Management System of Wangsa Maju WTP. 06 NOV PNHB was awarded the NACRA 2001 Industry Excellence Award under the Construction & Infrastructure Project Companies category MAR PNHB Group s Executive Chairman, YBhg Tan Sri Rozali Ismail was awarded the Asia Water Management Excellence Award 2002 under the Individual Award Category. 31 OCT PNHB was awarded the NACRA 2002 Industry Excellence Award under the Construction & Infrastructure Project Companies Category MAR Rivercare Campaign I for school children was launched by YB Datuk Haji Mohd Khalid Mohd Yunus, the former Deputy Minister of Education. 20 JUL Official Ceremony to mark the release of initial 100 MLD of treated water at SSP2 WTP OCT PNHB won the KLSE Corporate Excellence Award 2000 for Main Board Companies and the KLSE Corporate Sectoral Award 2000 for Main Board Infrastructure Project Companies. 08 NOV PNHB was honoured with the NACRA 2000 Industry Excellence Award for the Construction & Infrastructure Project Companies category. PNSB received the Occupational Safety & Health Award 2000 Gold Award for SSP2 WTP. 10 NOV PNHB was awarded the Anugerah Citra Laporan Tahunan 2001 by Dewan Bahasa dan Pustaka FEB PNHB received the Asiamoney Corporate Governance Poll 2002 Award for Best Corporate Governance Standards in the Utilities Sector in Malaysia. 14 JUN PNHB received the Institute of Public Relations Malaysia IPRM Crystal Award 2002 under the Environmental Relations Category for the River Rescue Brigade Programme and the Voluntary Relations Category for the Educational Outreach Programme. PUNCAK NIAGA HOLDINGS BERHAD 056

63 DEC JAN 05 ANNUAL REPORT MAC NOV DEC NOV FEB PNHB was awarded the KLSE Corporate Sectoral Award 2003 for Main Board by Bursa Malaysia. 15 DEC Concession Agreement for the Privatisation of Water Supply Distribution in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya between SYABAS, the Federal Government and the Selangor State Government. 31 DEC Handover Ceremony of the 26 WTPs in Selangor, Kuala Lumpur and Putrajaya from CGE Utilities (M) Sdn Bhd to PNSB at Bukit Nanas WTP JAN YAB Dato Seri Dr Mohd Khir Toyo officiated the ceremony to mark the commencement of operations of SYABAS at SYABAS Headquarters. 19 JAN YBhg Tun Dr Lim Keng Yaik, the former Minister of Energy, Water and Communications, witnessed the Signing Ceremony of the Financing Facilities Agreement between SYABAS and a panel of financial institutions at Hotel Istana Kuala Lumpur OCT PNHB announced a capital repayment of up to RM million via a cash distribution to reward its shareholders. 28 NOV Official Opening Ceremony of Wisma Rozali, Shah Alam, Selangor MAR Signing Ceremony of the Collaboration Agreement between Puncak Research Centre Sdn Bhd and DHI Water Environment Health Denmark. 30 MAR Handover Ceremony of Sungai Sireh WTP from Kumpulan Perangsang Selangor Berhad to PNSB. 15 MAY SYABAS garnered the 2007 Malaysia Water Award (Management Category) for PUSPEL. 26 JUNE PNSB s Ekspedisi Menuju Puncak at Mount Kinabalu, Sabah. 14 NOV PNSB received an Honourable Mention for its River Rescue Brigade at the Prime Minister s Corporate Social Responsibility Awards MAY PNHB was shorlisted under the Social Reporting Category for ACCA Malaysia Environmental And Social Reporting Awards (MESRA) 2007 [now known as ACCA Malaysia Sustainability Reporting (MaSRA) Awards]. 11 NOV SYABAS was awarded the Malaysian Business Ethics Excellence Award 2008 under the Large Company Category. 17 NOV & 15 DEC PNSB received the Integrated Management System (IMS) Certification for the Provision of Construction Services certified by URS Certification (M) Sdn Bhd (URS) and accredited under United Kingdom Accredited Service (UKAS). 19 NOV PNHB was awarded the NACRA 2008 Industry Excellence Award for Main Board Construction & Infrastructure Project Companies Category. PUNCAK NIAGA HOLDINGS BERHAD 057

64

65 DRIVING PERFORMANCE Challenges must never be the only catalyst for change. True performance improvement is a renewal process to actively drive the top and bottom lines of a business or an organisation forward. Value can only be maximized if strong leadership is in place to ensure that all parts of an organization are performing at their maximum potential, while driving towards common goals. ALL OUR 29 WTPS ACHIEVED THE EXPECTED LEVELS OF PERFORMANCE AS REQUIRED FOR TREATED WATER

66 OPERATIONS REVIEW PUNCAK NIAGA (M) SDN BHD ANNUAL REPORT 2009 OPERATIONAL PERFORMANCE Operational Performance is a key area of focus at PNSB since we are required to ensure the smooth and uninterrupted operation of the Water Treatment Plants (WTPs) for the production and supply of treated water to the quantity and quality as required under the Concession Agreements. It is PNSB s paramount duty to ensure a constant and sufficient supply of water exceeding the mandatory requirements. WATER TREATMENT PLANTS We constantly work to ensure that our WTPs are operating at optimum capacity. In 2009, all 29 WTPs recorded a total production of million cubic metres of treated water, an increase of 0.97% from million cubic metres of treated water produced in Whilst we try to keep unscheduled shutdowns to a minimum to ensure that water is always available to our consumers, there are instances where this is not possible due to breakdowns and pollution incidences which are beyond our control. In 2009, we experienced a total of over 6,900 hours of unscheduled shutdowns, with details as shown below: PUNCAK NIAGA HOLDINGS BERHAD 060

67 ANNUAL REPORT Employees on routine maintainance at SSP2 WTP 02 Aeration system at Gombak WTP No. Reason Hours Of Shutdown 1. Raw Water Violation 5, TNB power failure Pipe burst Total 6, Overall, all our 29 WTPs performed well and achieved the expected levels as required under the Concession Agreements and met the requirements for treated water by SYABAS as well as the Drinking Water Quality Standards as stipulated by the Ministry of Health (MoH). A PERSON LOSES WEIGHT IN WATER, NOT FAT AFTER A WORKOUT In 2009, the performance of our WTPs are as follows: SSP2 WTP recorded a total production of million cubic meters of treated water in 2009, an increase of 2.57% from million cubic metres of treated water in The average daily production in 2009 was million litres as compared to million litres in 2008 although the design capacity and designated quantity of the WTP is 950 MLD. Wangsa Maju WTP recorded a total production of million cubic metres of treated water, a decrease of 1.5% from million cubic metres of treated water in The average daily production in 2009 was million litres as compared to million litres in Sg Sireh WTP recorded a total production of 7.75 million cubic metres of treated water, a decrease of 1.8% from 7.89 million cubic metres of treated water in The average daily production in 2009 was million litres as compared to million litres in The 26 WTPs under the Privatisation Cum Concession Agreement (PCCA) dated 22 September 1994 recorded a total production of million cubic metres of treated water, a decrease of 0.5% from million cubic metres of treated water in The average monthly production in 2009 was million cubic metres as compared to an average production of million cubic metres in The slight drop in production was due to a change in SYABAS treated water distribution strategy. Nonetheless, the 26 WTPs were able to meet the PCCA s designated quantity of million cubic metres per month. In terms of quality of treated water, all WTPs under PNSB s responsibility achieved 99.9% compliance based on 16,373 samples tested by both the Independent Laboratory and Central Laboratory. PUNCAK NIAGA HOLDINGS BERHAD 061

68 OPERATIONS REVIEW PUNCAK NIAGA (M) SDN BHD ANNUAL REPORT SSP2 WTP Command Centre 02 Monitoring of raw water quality at the aerator in Wangsa Maju WTP CAPACITY EXPANSION AND IMPROVEMENT WORKS To meet the increasing needs of the consumers in the areas where we service, we have to constantly upgrade or improve our services, where possible to meet the needs of the future growth in our service areas. During the year under review, we managed to carry out improvement works on three (3) of our WTPs, namely: 1. Capacity Upgrading of Bernam River Headworks (BRH) WTP (Phase 1) Capacity upgrading of BRH WTP formed part of SYABAS capital expenditure programme for 2009; planned with a maximum capacity of 40 MLD. The upgrade is to be implemented in two (2) phases where Phase 1 involved the construction of a 25 MLD-capacity WTP that was completed and fully commissioned in March 2010, whilst Phase 2, involving the construction to cater for the remaining 15 MLD will be constructed at a later stage. BRH WTP Phase 1 will provide an additional 25 MLD of treated water to Sabak Bernam and Sg Besar areas. 2. Refurbishment of Sg Lolo WTP (Extension) Works The Sg Lolo WTP was designed with a capacity of 0.6 MLD, supplying to areas located between the Sg Langat Dam and Bt. 14, Hulu Langat. The refurbishment of Sg Lolo WTP (extension) works was necessary to improve treated water quality and reliability of water supply as well as to repair and refurbish the WTP itself. Site possession took place in February 2009 and the construction was fully completed in December Improvement in Reliability of Sg Lolo (Old) WTP The Sg Lolo (Old) WTP is a partial treatment plant with average daily production of 0.73 MLD. The plant was frequently closed whenever the river turbidity increased during rainy days. In an effort towards improving the reliability of the WTP in all weather condition, PNSB has provided alternative raw water source through pumping from Sg Langat Dam. The improvement works was completed in February 2009 and it includes laying of pipeline and pumping system. IMPROVING WATER FILTER PERFORMANCE We closely monitor the water filter performance continuously as the water filter is the final step to remove solids in a WTP. The breakdown of the filter run time of the 174 filters at the 29 WTPs are as tabulated below: PUNCAK NIAGA HOLDINGS BERHAD 062

69 ANNUAL REPORT & 04 Routine maintenance inspection at SSP2 WTP As At December 2008 As At December 2009 Filter Run Time Per Month (Hours) No. of Filters % No. of Filters % 60 - < < < < Total* Note: *Some filters were not in operation as they were either under repair or on standby WATER DISSOLVES MORE SUBSTANCES THAN ANY OTHER LIQUID We have been conducting filter refurbishment through plant improvement works and whenever the need arises. To date, we have refurbished the filters at the Sg Sireh and BRH WTPs whilst one of the five slow sand filters at the Ampang Intake WTP is undergoing refurbishment. The refurbishments of these filters resulted in enhanced treated water quality especially in terms of turbidity and residual aluminium. DAM OPERATIONS Pursuant to the Supplemental Agreement to the Privatisation Cum Concession Agreement (PCCA) dated 31 December 2004, we operate and maintain three dams in Selangor, namely: Sungai Langat Dam Klang Gates Dam Tasik Subang Dam As part of our efforts to anticipate the current and future needs of our consumers as well as the impacts of climate change on our raw water supply systems, we carry out constant dam surveillance and monitoring. Under our dam monitoring programme, dam levels and rainfall volumes in the dams catchment areas are regularly monitored to assess the possibility of critical storage drawdown at any of the dams at any one time. The three dams have been equipped with the Dam Operations Control Curves to help dam operators in meeting the demand from the WTPs for raw water release besides conservation of dam water to prolong storage. In 2009, the total annual rainfall in the catchment areas of the three dams; the Sungai Langat Dam, Klang Gates Dam and Tasik Subang Dam, were 2,295.6 mm, 2,658.6 mm and 2,323.3 mm, respectively as there have been less rainfall and the 2009 readings were comparatively, below the mean average rainfall (based on data from 1998 to 2009) of the three dams which were 2, mm, 2, mm and 2, mm, respectively. PUNCAK NIAGA HOLDINGS BERHAD 063

70 OPERATIONS REVIEW PUNCAK NIAGA (M) SDN BHD ANNUAL REPORT Briefing to the Minister of Energy, Green Technology and Water, YB Dato Sri Peter Chin Fah Kui at SSP2 WTP s laboratory 02 Employees monitoring the clarification process at SSP2 WTP The Malaysian Meteorological Department has forecasted an average annual rainfall of 2,310 mm for 2010, and with prudent management of releases from the dams during any intermittent dry spells, constant monitoring of the dam reservoir levels and the analysis of past inflows, we hope to alleviate a storage crisis for 2010 in the event of any long periods of drought which had already affected several states in Malaysia. As part of our safety surveillance programme, we conducted two major visual safety inspections in The purpose of the inspections, which covered all major dam structures and M&E equipment, was to detect any dam safety deficiencies and to recommend appropriate corrective actions. Thus far, we have not found any major deficiencies in the three dams. CERTIFICATIONS ISO Environmental Management System SSP2 WTP is the first WTP in Malaysia to obtain the Environmental Management System certification. The original ISO 14001:1996 certification obtained on 3 December 2003 was successfully converted to ISO 14001: 2004 on 11 November SSP2 WTP has successfully maintained the ISO 14001:2004 certification until to date without any major non-conformity. ISO 9001 Quality Management System PNSB is in the process of conducting Internal Quality Audit to upgrade the ISO 9001:2000 certification to the new version of ISO 9001:2008 for 18 WTPs under the PCCA including SSP2 and Wangsa Maju WTPs, which will be expiring in April OHSAS Health and Safety Management System Recently, SSP2 WTP has obtained its Certificate for OHSAS 18001: 2007 in February The above certifications obtained by PNSB have greatly enhanced and increased the public s trust in our WTPs and Management following the adoption of internationally recognised systems. INFORMATION AND COMMUNICATION TECHNOLOGIES (ICT) In 2009, several IT projects and systems were implemented and introduced to the Company, namely: PUNCAK NIAGA HOLDINGS BERHAD 064

71 ANNUAL REPORT Inspection of the ultra filtration membrane module 04 Visit by the Minister of Energy, Green Technology and Water, YB Dato Peter Chin Fah Kui to the Wangsa Maju WTP s Operation Centre PNHB s Revamped Corporate Web Page We launched our new, dynamic and innovative Corporate Web Page in June The main feature of the Web Page is the Content Management System which enables the contents of the web page to be dynamically updated by the respective Departments in PNSB. The latest corporate information and news of PNHB Group are instantly uploaded and updated to the Corporate Web Page for public dissemination. Purchase Requisition (PR) Online System The PR Online System is a web-based application that enhances the Purchase Requisition (PR) creation and approval process as well as ensuring that PNSB s PR process is managed effectively, efficiently and accurately. WATER CARRIES CHEMICALS, MINERALS, AND NUTRIENTS WHEREVER IT FLOWS The PR Online System is a centralised system linking the Group s Head Office at Wisma Rozali, Shah Alam (Head Office) and the 29 WTPs and the five Regional Offices. PREVENTIVE MAINTENANCE Preventive IT Maintenance As part of the IT Department s Service Level Agreement (SLA), quarterly preventive IT maintenance are performed by the IT Department at the Head Office and at all 29 WTPs. During the year, the Preventive Maintenance Programmes of the WTPs (PMT) have been carried out successfully and in accordance with the committed number of preventive maintenance tasks as set out by PNSB (Committed Number of PMT), in particular, the Wangsa Maju WTP and Sg Sireh WTP which had achieved more than 100% of the Committed Number of PMT as of 31 December This measure has benefited PNSB in ensuring that all systems are up-to-date, properly maintained, secured and free from any malicious viruses or spyware attacks. The preventive IT maintenance has effectively managed to prevent numerous possibilities of Disruption of Service and risk mitigation which form part of the Group s risk management processes and internal controls. Predictive and Preventive Plant Maintenance We place great importance on implementing predictive and preventive maintenance at all the 29 WTPs. This is part of our strategy to ensure that all our equipment and plants are in good conditions and 100% available at all times. Under this strategy, PNSB would draw up the annual maintenance plan for which the maintenance personnel will have to adhere to and their implementation performance is monitored by means of two computerised maintenance system, namely, Maintpro and Maximo. For 2009, out of 19,838 number of maintenance works that were scheduled, 22,567 number of tasks were completed, which translates to % achievements with all WTPs performance exceeding 100%. PUNCAK NIAGA HOLDINGS BERHAD 065

72 OPERATIONS REVIEW SYARIKAT BEKALAN AIR SELANGOR SDN BHD ANNUAL REPORT 2009 WATER DISTRIBUTION SERVICES Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS) distributes treated water to a population of 7.3 million comprising domestic, commercial and industrial consumers in Selangor, Kuala Lumpur and Putrajaya through million consumer connections or accounts (Connections/Accounts), the largest in the country, of which 85.16% of the Connections/Accounts are for domestic consumers. During the year, SYABAS distributed a daily average of 3,924 MLD of treated water which is 57 MLD (1.5%) more than in SYABAS continued to maintain its water distribution assets comprising 24,893 km water distribution pipes of sizes ranging from 100 mm to 2,200 mm in diameter, 1,240 service reservoirs, elevated water tanks and suction tanks and 451 booster pumping stations. Water supply coverage in urban areas is 100% whereas water supply coverage in sub-urban or rural areas is still maintained at 99%. SYABAS has been acknowledged by the National Audit Department (Jabatan Audit Negara) (JAN) in their 2008 Auditor General s Report dated 17 July 2009 as the leading Operator in terms of water quality compliance with the Ministry of Health s (MOH) Drinking Water Quality Standards. In terms of response time to emergencies, SYABAS has continued to excel and exceed the requirements of the Concession Agreement (SYABAS CA). This has been demonstrated during the incident involving a major pipe burst in Hulu Langat on 29 October 2009 whereby the media and public have also commended on the prompt actions and resolutions made by SYABAS. PUNCAK NIAGA HOLDINGS BERHAD 066

73 ANNUAL REPORT Our employee explaining the water bill to a consumer 02 Turun ke Padang & Ramah Mesra at Perumahan Rakyat Pantai Dalam, Kuala Lumpur ACHIEVEMENTS SYABAS achievement in year 2009 as a result of the concerted efforts from all SYABAS Management and employees is summarised as follows: 2009 Key Performance Target % of Achievement against Targeted Achievement (Without Tariff Increase) Billing 99.8% Collection Efficiency 99.08% Non Revenue Water 58.96% Water Purchase Costs 99.3% Distribution Cost (DC) 100% WATER INCREASES ENERGY LEVELS. DAYTIME FATIGUE IS COMMONLY ATTRIBUTED TO MILD DEHYDRATION SYABAS has set targets which are higher than the CA s requirements. In 2009, SYABAS had generally met all the targets set as well as SYABAS CA s requirements and the Mandatory Level Of Service. SYABAS achieved a low percentage for Non Revenue Water (NRW) due to many factors beyond its control, the major one being the freeze on CAPEX Programmes since July Due to these reasons, SYABAS has applied to the authorities for a review of the NRW targets. OPERATIONAL PERFORMANCE NRW Losses During the year under review, SYABAS continued to diligently manage and control NRW losses despite the CAPEX freeze by the Government pending the proposed restructuring of the water services industry in Selangor. The decision to freeze the CAPEX works since July 2008 has resulted in the postponement of various planned works as formulated under SYABAS NRW Master Plan which aims to progressively reduce water losses. PUNCAK NIAGA HOLDINGS BERHAD 067

74 OPERATIONS REVIEW SYARIKAT BEKALAN AIR SELANGOR SDN BHD ANNUAL REPORT Handling consumers queries in conjuction with SYABAS Migration Programme 02 SYABAS installing new plastic water meters Nevertheless, despite these difficult operating conditions, SYABAS still managed to carry out critical works during the year with limited funding, as follows: i. Establishment of 80 District Metering Zones (DMZ) in critical areas to monitor and control NRW losses. This project costing RM19.0 million was completed in January 2009 using funds from the Federal Government Grant of RM250.0 million. ii. Installation of 110 Pressure Management Zones (PMZ) to reduce pipe burst frequency which commenced in the 3rd quarter of 2009 following approval from Suruhanjaya Perkhidmatan Air Negara (SPAN) on 13 May The impact of this work can only be fully realised upon its completion in July iii. AMR EM flow meters replacement at 120 large consumer accounts. Similar to (ii) above, the programme commenced only during the 3rd quarter of 2009 and as such, the full impact of this programme can only be measured upon its completion in July iv. The ongoing NRW Phase 3 Contract for the creation of DMZ throughout Selangor, Kuala Lumpur and Putrajaya to derive scheduled savings under a performance based contract until v. April 2009 also marked the completion of NRW Phase 2 work. The 361 zones established under this contract are now being monitored and maintained as part of the scope under NRW Phase NRW Programme Results The 80 DMZ set up in critical areas have effectively reduced pipe burst frequency by 40%, contributing to substantial savings in repair cost, NRW losses and reduction of water supply interruptions. We continue ongoing NRW Phase 2 and 3 works to cut down physical losses following pressure management and active leakage control. In addition, the established zones are further improved to provide more savings in water losses. Overall, SYABAS was able to manage and maintain NRW at a level comparable to that achieved as at end of 2008 despite limited CAPEX and the effect on NRW due to the Natural Rate of Rise (NRR) in NRW as a result of the existing distribution network s ageing. The NRW for 2009 was measured and contained at 32.38%, as at 31 December 2009 slightly higher than the 32% level of 2008 due to the incremental effect of the NRR, estimated at 2.4% per annum. The measured NRW level could have been reduced by another 6.61% if not due to factors beyond the control of SYABAS. We have accordingly put in a claim for NRW allowance quantified in accordance with the terms of the SYABAS CA for inclusion into the overall measurement of NRW reduction performance to SPAN and the State Government of Selangor on 7 November This claim, however, had been rejected by the State Government of Selangor on 28 December 2009 and SYABAS has expressed its objection with all rights reserved pending the next course of action. PUNCAK NIAGA HOLDINGS BERHAD 068

75 ANNUAL REPORT Delivering clean water to Pulau Ketam residents during a water crisis 04 YB Noriah Kasnon, Sg Besar s Member of Parliment visiting SYABAS Sabak Bernam District Office Since commencement of the SYABAS CA on 1 January 2005, the NRW has been progressively reduced from 42.78% as at 1 January 2005 to 32.38% as at 31 December The achievement can be evidenced in the water production being maintained whilst the billed consumption increased. In summary, SYABAS have effectively reduced up to 593 MLD in physical losses or wastage and this quantity of supply has been consequentially channelled to cater for meeting the increasing water demand in Selangor and Federal Territories of Kuala Lumpur and Putrajaya. As part of the Mandatory Level Of Service, SYABAS is required to maintain sufficient relevant water pressure to the consumers in rural and urban areas. From the water pressure monitoring exercise carried out by SYABAS, some areas were found to be experiencing low water pressure due to the following reasons: 1.4 MILLION CHILDREN DIE EACH YEAR DUE TO DISEASES CAUSED BY UNCLEAN WATER AND POOR SANITATION Located on high and undulating ground. Located at the end of the distribution system. Unsystematic (spaghetti) pipeline inherited from Jabatan Bekalan Air Selangor (JBAS)/Perbadanan Urus Air Selangor Berhad (PUAS). Undersized pipeline. Areas such as Broga, Jalan Sg Lalang and Beranang in Hulu Langat have been identified to experience low water pressure particularly during peak period due to high ground and distance. However, with the completion of the Bangi Bulk Transfer project by October 2010, it is envisaged that low water pressure problem in these areas will be resolved. Other areas that have been identified to experience low pressure include Sijangkang, Telok Panglima Garang and Jalan Kebun in Klang, where the supply comes from Bukit Lipat Kajang. These areas are located at the tail-end of the distribution system and at times, during peak demand periods, experience low water pressure. A project has been proposed to improve water pressure and the overall distribution system in this area which involves the construction of a new 32 MLD reservoir at Bukit Lipat, Kajang and pipe distribution network. However, this project could not be implemented immediately due to the freezing of CAPEX programme, as explained earlier. PUNCAK NIAGA HOLDINGS BERHAD 069

76 OPERATIONS REVIEW SYARIKAT BEKALAN AIR SELANGOR SDN BHD ANNUAL REPORT Carrying out routine pipe maintenance and inspection 02 A cost effective solution to cleaning reticulation pipes via air scouring Nonetheless, in 2009, SPAN had approved the following projects for improvement of water pressure in the distribution system of Kuala Selangor, Hulu Langat and Gombak District, as follows: i. Upgrading of the water supply system at Kg Parit Mahang, Kuala Selangor. ii. Upgrading of the water supply system and pump house at Kg Darul Hidayah, Hulu Langat. iii. Upgrading of water supply system at Kg Sg Tekali, Hulu Langat. iv. Installation of pipes at Area C Jalan Nakhoda Kiri 3, Kg Nakhoda Sg Tua, Gombak. Rehabilitation of Leaking Water Tanks To further reduce NRW losses and improve the reliability of water supply, SYABAS has submitted a list of water tanks identified amongst the total of 1,240 water tanks within SYABAS water distribution system which were inherited from PUAS for rehabilitation or replacement. However, due to limited funding, only a few water tanks were approved for rehabilitation in 2009 namely, Sg Lui water tank, Taman Bukit Mutiara water tank, Villaraya water tank, Bandar Sunway Semenyih water tank, all in Hulu Langat; Taman Gemilang water tank in Gombak; Rawang Batu 19 ¼ water tank in Hulu Selangor and Bukit Malawati water tank in Kuala Selangor. As of 1 January 2010, some of the rehabilitation or replacement of water tanks have been completed whilst some are at tendering stage. Once completed, it is envisaged that there will be improvement in terms of reliability of water supplied since the water tanks will provide additional storage in SYABAS water distribution system. Development of SCADA System We have implemented the RM27.5 million project approved by the Ministry of Energy, Green Technology and Water (KeTTHA) on the provision of the SCADA system for 95 key pump houses and 155 critical reservoirs ( SCADA System Project ). The SCADA System Project also includes the development and commissioning of the Operation Command Centre (OCC). With the commencement of the OCC in September 2009, we are now able to better manage the water distribution network in Selangor through the commissioning of our new master SCADA system at OCC. As of end March 2010, an overall total of 150 reservoirs and pump houses are transmitting live data to the OCC. The transmission of live data for the remaining 100 stations will be activated in stages in The implementation of the SCADA System Project has facilitated the monitoring of reservoirs water levels, the early detection of off limit, low or high water level at the reservoirs to prevent overflowing of reservoirs, to detect sudden drop in reservoirs levels and to take immediate actions to prevent water supply disruptions. The SCADA System Project allows pump sets to be monitored and operated remotely from the OCC for those installed with the facilities and this has enhanced operational effectiveness as well as monitoring any intrusion into 10 selected pump houses via the Close Circuit Television. PUNCAK NIAGA HOLDINGS BERHAD 070

77 ANNUAL REPORT The spouse of PNHB Group Executive Chairman visiting SYABAS counter during the World Water Day 2009 celebration 04 Pipe laying works in progress Under a separate programme, to facilitate distribution of water to different water supply zones and monitoring of flows, flow meters are installed at trunk mains. As of 31 December 2009, the physical installation works of 120 electromagnetic flow meters along the trunk mains at strategic locations have been completed under the Water Balance Management (WBM) programme. The meters are linked to the OCC to monitor the performance of the trunk distribution system on a real time basis. Site Acceptance Tests for the remaining 40 meters will be completed in April WATER LEAVES THE STOMACH FIVE MINUTES AFTER CONSUMPTION In addition, hydraulic models are being established which would ultimately be able to simulate the flow and pressure conditions in the network under various scenarios to facilitate all activities including Operations and Maintenance (O&M) planning, NRW management, planning for network capacity upgrading, water quality improvement, new housing development plan approval, trunk main management and provide the Emergency Response Plan Committee the necessary tools for swift decision-making in the event of emergencies. Water Quality Report For SYABAS, water quality remains its top priority in ensuring that the water supplied to the consumers is always safe for consumption, direct from the tap. In 2009, SYABAS again complied with the Mandatory Level Of Service on water quality as required in the SYABAS CA as well as the requirements of MOH s Quality Assurance Programme (QAP). SYABAS has also continued to implement the following programmes under our Water Quality Enhancement Master Plan: 1. Air Scouring Programme (ASP) 2. Reservoir Cleaning and Inspection Programme (RCP) 3. Water Quality Sampling and Testing Programme 4. Immediate Response to Consumer Complaints 5. Consumer Awareness and Education Programme PUNCAK NIAGA HOLDINGS BERHAD 071

78 OPERATIONS REVIEW SYARIKAT BEKALAN AIR SELANGOR SDN BHD ANNUAL REPORT Unveiling of Puspel s new logo and service motto 02 Cleaning the reticulation pipe system using the air scouring method AIR SCOURING PROGRAMME (ASP) As at 31 December 2009, a total of 9,242 km of our 12,527 km or 7,800 zones (complete with preliminaries) of reticulation pipes of diameters 200 mm and below have been identified under the ASP as follows: Districts Total No. of Zones Complete with Total No. of Zones Without Preliminaries and Cleaned Preliminaries No. % No. % Petaling 1, , Klang/Shah Alam 1, Kuala Lumpur Gombak Hulu Langat Sepang Hulu Selangor Kuala Langat Kuala Selangor Sabak Bernam Total 7, , A total of 2,781 zones are without the preliminaries installed and hence, cannot be cleaned under our ASP. These zones are scheduled to be cleaned in 2010 after the installation of the preliminaries which in turn depends on the availability of budget under SYABAS CAPEX Programme. RESERVOIR CLEANING AND INSPECTION PROGRAMME (RCP) 977 service reservoirs are registered under this programme. Since the RCP commenced in 2005, 833 or 85% of these reservoirs have been successfully cleaned. The remaining reservoirs that were not cleaned were either newly brought into service or were recently handed over to SYABAS by the developers. In 2009, 194 reservoirs were cleaned subsequently either manually or by open scour flushing depending on water quality violation detected. All the reservoirs are also inspected for water quality every six months. Further to that, monitoring of water quality condition in the reservoirs has been carried out under the Inspection Programme. PUNCAK NIAGA HOLDINGS BERHAD 072

79 ANNUAL REPORT Technical Briefing to YB Dato Sri Peter Chin Fah Kui at SSP2 WTP 04 Cleaning SYABAS service reservoir The status of reservoir inspection is shown in the table below: Status of Reservoir Inspections Year Cycle Jan Oct Nov Dec Cumulative No. of Inspection % No. of Inspection % No. of Inspection % 2009 First * Second ** Notes: * 966 reservoirs or 99% were successfully inspected in the first cycle and only 11 reservoirs (1%) could not be inspected as some of these reservoirs are still under the purview of the developers and have not been handed over to SYABAS whereas some are pending rectification of the safety ladder. For these reservoirs, water analysis results from the nearest sampling stations will be considered to monitor the reservoir status. ** For the second cycle, 959 reservoirs or 98% were successfully inspected. 18 (2%) could not be inspected as some of these reservoirs are still under the purview of the developers and have not been handed over to SYABAS whereas some have safety concerns such as poor ladder and railing conditions. Similarly, for these reservoirs, water analysis results from the nearest sampling stations will be considered to monitor the reservoir status. A SMALL DRIP FROM A FAUCET CAN WASTE AS MUCH AS 75 LITRES OF WATER A DAY WATER QUALITY SAMPLING AND TESTING PROGRAMME (WQS) As at 31 December 2009, SYABAS maintained a total of 1,093 sampling stations under the WQS. Water quality sampling is carried out by MOH and analysed by the Department of Chemistry in accordance with MOH s Drinking Water Quality Standards. A total of 109,056 water quality analyses were carried out from 1 January 2009 to 31 December 2009 by MOH. Based on 1 January 2009 to 31 December 2009 water samplings and test results, the water quality in the distribution system complied with SYABAS CA s Mandatory Level Of Service as well as within the MOH s QAP with the exception of fluoride content which originated from the WTPs. In this respect, SYABAS achieved 99.46% compliance with the National Drinking Water Quality Standards with zero violation on microbiological parameters. Water sampling and testing are also conducted at the in-house water sampling stations that are currently not monitored by the MOH. As of 31 December 2009, there were 470 in-house water sampling stations from a total of 1,093 active water sampling stations not monitored by the MOH. For the in-house water sampling and testing programme, chemical and microbiological analysis are carried out by an accredited laboratory. Sampling frequency for physical parameters remains unchanged and are in accordance with the MOH s requirements. PUNCAK NIAGA HOLDINGS BERHAD 073

80 OPERATIONS REVIEW SYARIKAT BEKALAN AIR SELANGOR SDN BHD ANNUAL REPORT Water meter migration programme at Apartment Phase 18R8, Precint 18, Putrajaya 02 PUSPEL operates 24/7 throughout the year to attend to customers queries, complaints and monitor remedial actions IMMEDIATE RESPONSE TO CONSUMER COMPLAINTS Since March 2009, SYABAS has set the initial response time for water quality complaints to 30 minutes (1/2 hour) and as at 31 December 2009, we have achieved a compliance rate of 93.8%. CONSUMER AWARENESS AND EDUCATION PROGRAMME The Consumer Awareness and Education Programme is presented in the Consumer Awareness and Education Programme section under Delivering Service Excellence in page 089 of this Annual Report. Migration of Bulk Meter Accounts to Individual Meter Accounts As at 31 December 2009, we have completed the migration of 119 bulk meter accounts to 27,647 individual accounts, representing only 5% of the dwellers in condominiums, apartments and flats in the Klang Valley. This is despite the numerous reach-out programmes carried out by SYABAS, to encourage the management companies to apply for migration. The delay in the migration exercise has been caused by reluctance of the management companies and complications of compiling valid documents from the residents by the building management. SPAN is still in the process of enacting the relevant rules for bulk meter migration under the Water Services Industry Act 2006 (WSIA) to make it mandatory for all building management with bulk meter accounts to migrate to individual meter accounts under the WSIA. Billing and Collection One of our primary growth strategies is to improve on billing and collection systems and processes in order to boost our revenue and cash flow stream. As of 31 December 2009, the total number of active water supply accounts was 1,664,073, representing a growth of 5.4% from 1,579,171 accounts recorded in Total billings for 2009 was 3% higher than the billings recorded in The table below shows the billing summary with a cumulative growth of 34% in 2009 over the last five years: Year * Growth 9% 18% 5% 5% 3% Cumulative Growth 9% 18% 25% 30% 34% * implementation of new tariff rate approved by the Government of Malaysia Total bill payments collected in 2009 increased by 3.0% against the total payments collected in Total collections included payment received from Kumpulan Darul Ehsan Berhad (KDEB) for the months of January to December 2009 in respect of the first 20m 3 free water to the domestic users in Selangor. Overall collection efficiency in 2009 was at 99.1%. PUNCAK NIAGA HOLDINGS BERHAD 074

81 ANNUAL REPORT Minister of Energy, Green Technology and Water, YB Dato Sri Peter Chin Fah Kui visiting SYABAS exhibition booth 04 Launching of SYABAS Program Penyertaan Usahawan Bumiputra Total receivables for 2009 were reduced to RM158.3 million, representing a 2.2% reduction as compared to RM161.8 million in As of 31 December 2009, debtors days (Accounts receivable) were improved to an average of 40 days as compared to 42 days in Disconnection activities increased by 7.8% from 2008 to 2009 whilst the reconnection to disconnection ratio increased from 82.9% in 2008 to 84.5% in 2009 and this was attributed to the improved communication between the consumers and SYABAS. Meeting the Needs of the Future We foresee that there will be water shortage problem principally due to the delay in the implementation of the Pahang-Selangor Inter-State Water Transfer Scheme, which was initially scheduled for completion by 2007 but is now expected to be completed only in May 2014, at the earliest. The anticipated water shortage by the year 2014 is estimated at 651 MLD, prior to the completion of the Pahang-Selangor Inter-State Water Transfer Scheme. LESS THAN 1% OF THE WORLD S FRESH WATER IS READILY ACCESSIBLE FOR DIRECT HUMAN USE It is anticipated that the shortfall of water supply will occur mainly in the southern region of Selangor due to geographical imbalance between water supply source and the demand centres within the state. The majority of the water supply source is available in the northern region of Selangor whilst the southern region has increasing water demand due to rapid population growth, increasing urbanisation and industrial developments. The water shortage is expected to be further aggravated by the deteriorating raw water quality especially during dry season that could subsequently lead to WTPs shutdown. In order to mitigate the impending water shortage in Selangor, Kuala Lumpur and Putrajaya for the interim period prior to the completion of the Pahang-Selangor Inter-State Water Transfer Scheme, we have identified several immediate solutions: Laying of raw water pipes from Langat weir to Cheras Mile 11 WTP to avoid taking polluted raw water from Sg Raya and Sg Perimbun especially during the dry season. Construction of a new intake and raw water pumping station to increase raw water supply to Sg Selangor Phase 1 (SSP1) and/or Sg Selangor Phase 2 (SSP2) (Scheme 2). Upgrading of the production capacity of Sg Batu WTP utilising the raw water storage from Sg Gombak via storage in Batu Pond and Sg Batu Dam (Scheme 3). Wangsa Maju Bulk Transfer Scheme. Extension of Sg Langat WTP with additional raw water storage. Development of Dengkil wetland and pond system including the construction of a new WTP as alternative supply source if the Bukit Tampoi, Salak Tinggi and Sg Semenyih WTPs are affected by pollution. Development of groundwater as alternative raw water source. Development of Sg Bernam for additional water supply Stage 1a. PUNCAK NIAGA HOLDINGS BERHAD 075

82 OPERATIONS REVIEW SYARIKAT BEKALAN AIR SELANGOR SDN BHD ANNUAL REPORT Pipe laying works in progress 02 SYABAS SCADA Control Centre SYABAS had submitted a proposal to the Selangor State Government and the Federal Government on 20 May 2005 on the above proposed measures to prevent a water supply crisis and the matter is still pending their decision and action, as the responsibility to develop additional water resources is under the purviews of the Selangor State Government and the Federal Government. Utilising of Information and Communication Technologies (ICT) To date, SYABAS Integrated Water Management Information System (SWIMS) has become the heart of SYABAS operations and administration since it has integrated most of the systems between the operations, management, financial, billing and customer service systems. SYABAS aspires to be an ICT Driven Company in tandem with its Vision and Mission. In 2009, the following IT application systems were implemented to replace manual processing which enhanced, sped-up and improved SYABAS operations and management: iclaim, a system developed to manage and to monitor all contract payment claim process in order to achieve payment process on time. With this new system, it is expected to eliminate complaints on late payment by vendors and suppliers and help to achieve SYABAS internal control of 45-days payment delivery process. iutilities system is specially developed for SYABAS to monitor and to manage the electricity, telecommunication and other utilities billing invoices centrally. Auto Debit introduced in the last quarter of 2009 with CIMB Bank Berhad being the first bank appointed by SYABAS to provide more options to SYABAS consumers in settling water bills on time. BASIS and SUN System Integration initiative to automate reconciliation of accounting data between the Billing System and the SUN System. SYABAS ICT Department also participated in the National Security Council s Cyber Security X-Maya 2 Cyber Drill which was held on 9 December This event has tested and confirmed SYABAS Computer Security Incident Response Team s (SyCSIRT) capabilities and readiness in addressing cyber security incidences. PUNCAK NIAGA HOLDINGS BERHAD 076

83 DELIVERING QUALITY ANNUAL REPORT Our laboratories adhere to stringent quality control 04 SYABAS Water Quality Campaign at USJ13, Subang Jaya WATER QUALITY SURVEILLANCE As part of delivering good quality water to our consumers, we conduct water quality surveillance programme ( WQS Programme ) to monitor the quality of both the raw and treated water at all our Water Treatment Plants ( WTPs ) and distribution networks and to ensure that all water treated by our WTPs and distributed to all consumers are equal or better than the Ministry of Health s (MOH) National Drinking Water Quality Standards. WATER REGULATES THE EARTH S TEMPERATURE Central Laboratory Our Central Laboratory, an ISO/IEC certified laboratory ( CL ), has the primary responsibility to conduct our WQS Programme. In June 2009, CL successfully maintained its accreditation certification and achieved additional accreditation for seven water quality parameters. CL has the capacity to analyse certain spectrum of water quality requirement as required by MOH National Drinking Water Quality Standards, under the following groups: 1. Group I (Microbiological and Physical). 2. Group II (Inorganic). As part of Puncak Niaga (M) Sdn Bhd s (PNSB) ongoing laboratory services enhancement, CL aims to obtain accreditation for MS ISO/IEC for all the water quality analysis conducted/to be conducted by the end of In 2009, CL achieved 97.8% and 97.3% sampling for raw and treated water for all the WTPs operated by PNSB based on MOH s monitoring frequency. Sampling of 100% could not be achieved due to plant shutdowns caused by raw water pollution incidences at Salak Tinggi WTP and Cheras WTP in July The water quality analysis breakdown conducted by CL and the Independent Laboratory is as detailed below: No. of Analysis conducted for PNSB s WTPs by Central Laboratory Independent Laboratory Total Raw water 8,015 7,972 15,987 Treated water 11,958 8,580 20,538 36,525 PUNCAK NIAGA HOLDINGS BERHAD 077

84 DELIVERING QUALITY ANNUAL REPORT Manual cleaning of reservoirs in progress 02 Scheduled maintenance is strictly adhered to at all our WTPs Based on the water quality monitoring carried out by CL, our WTPs achieved 99.9% treated water quality compliance. There were 13 cases of treated water quality non-compliances detected, mainly for residual aluminium due to incomplete treatment process. Other CL s Services Besides the WQS Programme, CL s services also extends to the following: 1. Provide testing services for environmental investigations carried out by PNSB s Water Resources and Environmental Surveillance (WRES) team [now known as Water Quality and Research Section ( WQRS )] and Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS) for its WQS Programme at its distribution networks. 2. Conducting laboratory assessment for all WTPs to ensure laboratories at the WTPs are maintained in good working conditions. 3. Purchasing of laboratory consumables and equipments for all WTPs. 4. Conducting maintenance, servicing and calibration of laboratory equipment used at all the WTPs to ensure accurate and reliable results in water quality testing. 5. Assisting in the water quality monitoring at affected WTPs during plant shutdowns. 6. Providing training to WTPs employees on water quality testing as well as maintenance of laboratory and testing of equipment. 7. Conducting analysis of WTPs chemical to ensure compliance to product specification for plant production and meeting the desired quality. 8. Analysis of filter media for compliance with operational specification and consistency of filters performance. Efficiency Initiatives In 2009, PNSB initiated several efficiency initiatives to improve our services, namely: 1. Implement integrated performance management project, which increases remote operational site management and optimises chemical and power usage. 2. Implement asset improvement programme which improves the efficiency and effectiveness of operation, particularly the pumps and dosing equipment. 3. Track, report on monthly basis and compare against benchmarks set, the efficiency of WTPs in respect of water losses, variable cost and fixed cost. 4. Implement workforce management project to improve employees productivity. In 2009, SYABAS implemented the Supply Chain Management, which has been centralised to improve customer service. PUNCAK NIAGA HOLDINGS BERHAD 078

85 ANNUAL REPORT Routine inspection at SSP2 WTP 04 Water quality sampling by SYABAS personnel CRISIS MANAGEMENT Crisis Management prepares us to be ready at any time to be able to deal and solve issues that may hamper our abilities and capabilities to deliver safe treated water to our consumers. Most of the issues which arise are beyond our control, yet due to years of experience in the industry and with a detailed crisis management plan in place, we have been able to expeditiously solve problems related to the quality of raw water and/or our ability to provide safe treated water as and when such events occur such as the following incidences which occured in 2009: WATER MOVES AROUND THE EARTH IN A WATER CYCLE Date Incident 13 January 2009 Gombak WTP shutdown due to palm oil spillage as a result of an accident involving a lorry tanker and a laundry van at KM 28, KL-Karak Highway. 27 June 2009 Salak Tinggi WTP shutdown due to blackish water and high ammonia. 29 June 2009 / 13 August 2009 Sg Buaya WTP shutdown due to high turbidity in raw water. 29 June 2009 Oil spillage incident at Heveafill Sdn. Bhd. The oil spillage however, did not cause any shutdown. 6 July 2009 / 27 September 2009 Salak Tinggi WTP shutdown due to presence of odour and foamy water. 26 October 2009 / 14 December July 2009 Sg Selisek WTP shutdown due to diesel spillage. 14 July 2009 Cheras Mile 11 WTP shutdown due to high ammonia content. At SYABAS, our Emergency Response Plan (ERP) had been activated to manage major breakdowns efficiently and had successfully eliminated or reduced the extent or duration of water supply interruptions. SYABAS managed a total of 11 ERP events in 2009 which comprised one red code, two yellow codes and eight green codes, respectively. Potential water interruption incidences included WTPs shutdowns, raw water pollutions, trunk mains bursts or leaks or power failures. RESEARCH AND DEVELOPMENT Research and development (R&D) within the Group are conducted via: i. Puncak Research and Development Centre (PRDC). ii. WRES (now known as WQRS). iii. Strategic Resource Division of SYABAS. PRDC focuses primarily on technology and materials improvements. WRES (now known as WQRS) focuses on the detection and mapping of raw water deterioration and process improvements whilst the Strategic Resource Division of SYABAS focuses on research and development activities in relation to all aspects of SYABAS water distribution activities and operations including technical standards. PUNCAK NIAGA HOLDINGS BERHAD 079

86 DELIVERING QUALITY ANNUAL REPORT Our Central Laboratory staff conducting water sampling on site 02 Our well-trained staff carrying out water quality testing in the lab Puncak Research and Development Centre (PRDC) Our PRDC was established in 2008 and has since proved to be invaluable to Puncak Niaga Holdings Berhad (PNHB); as one-stop R&D centre for our Group. PRDC have carried out numerous R&D projects for the betterment of our WTPs and processes. The Group had entered into R&D Collaboration Agreement with the following: 1. DHI Water.Environmental.Health Denmark (DHI) The Collaboration Agreement with DHI is now valid until 14 March With DHI, we are researching ways to optimise water quality whilst at the same time reducing coagulant dosage, cost and production of chemical sludge. The study is still ongoing. 2. Universiti Putra Malaysia (UPM) The Collaboration Agreement with UPM is valid until 5 June With UPM, we are studying the use of alternative coagulants for WTPs. Based on preliminary studies conducted, six natural coagulants were found to be suitable, namely Moringa oleifera, Jatropha curcas, chitin chitosan, Dragonfruit foliage, Aspergillus flavus and Sago starch. We are now conducting feasibility and availability studies on the use of the natural coagulants with the ultimate objectives of replacing chemical based coagulants. R&D Initiatives Undertaken By Process Improvement Section of WRES (now known as WQRS) WRES (now known as WQRS) Processes Improvement Section (PIS) besides carrying out raw water quality surveillance including detection and mapping of raw water deterioration, is also involved in improving our water treatment processes for water quality enhancement and/or cost optimisation at our WTPs. Some of the results of our various research initiatives are as below: 1. The water quality of North Hummock, Sg Sireh and Sg Serai WTPs have improved. 2. Installed streaming current detectors (SCD) at the Langat, Bernam River Headworks and Batang Kali WTPs leading to an improvement in water quality, reduced the coagulant consumption through optimization and prolonging the filter run hours. 3. Installation of an aluminosilicate dosing system at the Bukit Tampoi WTP to increase the rate of ammonia removal. 4. Implement the fibre filter pilot plant with the second stage trial using alum as coagulant with its performance still being monitored. PUNCAK NIAGA HOLDINGS BERHAD 080

87 ANNUAL REPORT Confidence in SYABAS piped water quality 04 Our personnel during routine inspection WRES PIS is continuing its research on the following: 1. Exploring the possibilities of reducing water disruption incidences via the installation of a raw water diversion system from near-by water sources, ponds and dams. 2. Exploring for an alternative coagulant to replace alum in view that alum sludge will incur high disposal cost. 3. Conducting ongoing evaluation through pilot plant trials on products/ technologies recommended from time to time for improvement of our WTPs. Products evaluated in 2009 include lifting type pore controllable fibre filter, eco-logix 2000, water treatment agent, PGα21Ca, Dezavid and Ferroxx filter media. Pilot Project In July 2009, SYABAS embarked on a pilot project to study the use of Stainless Steel (SS) 316 tube for meter stand in coastal areas as it is much cheaper than the normal stainless steel pipes. To assess its performance, existing galvanised iron meter stands (which are easily corroded by salt content in soils especially at coastal areas), were replaced with the SS 316 tubes at the following districts: WATER IS THE ONLY SUBSTANCE FOUND NATURALLY IN THREE FORMS: LIQUID, GAS, SOLID Sepang (10 numbers). Kuala Langat (11 numbers). Kelang (10 numbers). Kuala Selangor (10 numbers). Sabak Bernam (10 numbers). The monitoring results after the first six months of installation indicated that the SS 316 tubes showed no signs of corrosion. We will be monitoring the SS 316 tube performance for another six months to confirm its effectiveness and its ability to withstand corrosion, prior to the implementation under the communication pipe replacement programme. SYABAS has deployed the No-Dig technology for its pipe replacement programme in two projects. The merits and constraints of this new technology have been analysed for future planning and execution of pipe replacements. In the pressure management works under SYABAS Non Revenue Water reduction programme, time-based pressure management has also been implemented and its performance has been evaluated for future fine tuning of pressure management works. PUNCAK NIAGA HOLDINGS BERHAD 081

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89 EXPANDING OPPORTUNITIES By being focused, with a clear investment and risk management strategy, we are continuously reviewing the potential to expand locally and to overseas markets not only in the same industry but other new ventures so as to diversify and widen our geographical business opportunities and enhance long term growth. VIA OUR 80% SINGAPORE SUBSIDIARY COMPANY, SINO WATER PTE LTD, THE GROUP EXPLORES FURTHER OPPORTUNITIES IN THE WATER AND WASTEWATER INDUSTRIES IN CHINA

90 BUSINESS UPDATES ANNUAL REPORT & 02 We are exploring and expanding our opportunities in China CHINA In the last 30 years, the rate of Chinese economic growth has averaged up to 11% growth in Gross Domestic Product (GDP) per annum (Source: USA Today). The economy has grown more than 10 times during that period, with Chinese GDP reaching 4.91 trillion US dollars in 2009 (Source: Bloomberg News). Infrastructure including water supply and sanitation in China has undergone massive transitions while facing numerous challenges such as rapid urbanization, water scarcity, contamination and pollution. China s budget of approximately 40 billion yuan (US$5 billion) in the water supply sector has been targeted to be spent mainly on new water supply projects over the next 10 years. Within this budget, there are plans to extend tap services to the suburbs from existing urban water facilities, and villages located far from cities will have their own water supply and treatment systems installed (Source: Worldwatch Institute). PNHB Group entered the China market in May 2008 via its 80% Singapore subsidiary company, Sino Water Pte Ltd (Sino Water) and has been developing business in China, for which various local subsidiaries were established to undertake its projects in China. ONGOING PROJECTS IN CHINA Lushan Water Supply Project The project, located in Lushan County, Pingdingshan City of Henan Province, is undertaken by Sino Water s 83% owned China subsidiary, Luwei (Pingdingshan) Water Co Ltd. The project involves taking over the operations and rehabilitating the Lushan Water Supply Facilities including the five existing underground water wells with an average daily treated water supply of approximately 2 MLD (Existing WTP) and the construction of a new 30 MLD Water Treatment Plant (WTP) (New Plant) that treats water from the Zhaopingtai Reservoir. The New Plant will subsequently replace all the existing underground water wells. Construction works for the New Plant commenced in November 2008 and is expected to be completed and commissioned in the fourth quarter of The Existing WTP started distributing treated water to 4,500 consumers in the Lushan Township, with an average daily treated water supply ranging from 1.4 MLD to 1.8 MLD in Water was abstracted from an underground aquifer and supplied directly to the consumer via five pumping stations. PUNCAK NIAGA HOLDINGS BERHAD 084

91 ANNUAL REPORT Our investment in China is conducted via our subsidiary in Singapore, Sino Water 04 Construction underway at a site in Lushan, China Water supply is expected to increase to 15 MLD when the New Plant, pipe replacements and meter installation works are completed in 2010 with 15,000 new consumers in addition to the existing consumer list of 6,000. The construction of the raw water pipeline to convey raw water from Zhaopingtai Reservoir can only commence in the third quarter of 2010 as compensation to the local villagers affected by the pipe-laying works has to be resolved. APPROXIMATELY 66% OF THE HUMAN BODY CONSISTS OF WATER Under the pipe replacement programme, 22.8 km of the reticulation pipelines have been laid and/or replaced. An additional 13.1 km reticulation pipelines will be laid and/or replaced by The water meter installations and replacements will also increase the number of consumers when completed. We will work with the local county government to close down private underground water wells once treated water could be supplied to the consumers upon the commissioning of the water supply scheme. Binzhou Wastewater Project Sino Water s wholly owned China subsidiary, Xinnuo (Binzhou) Water Co Ltd is undertaking this project, which is located in the Laodian Village of Yangxin County, in Binzhou City of the Shandong Province. The project encompasses the construction of a 30 MLD wastewater treatment plant (WWTP), which is divided into two phases of 15 MLD each. Upon completion of the construction of the WWTP by the end of 2010, the WWTP will treat wastewater from the nearby Tannery Industrial Park. There have been some visible developments in Chenlou Industry Park, Binzhou City of the Shandong Province, currently served by our WWTP, as a number of new factories are expected to be developed. The Laodian Village Government informed that there would be six tannery factories, one chemical factory and two construction material factories by 2010 and the total wastewater discharge from these factories is estimated at 15 to 16 MLD. PUNCAK NIAGA HOLDINGS BERHAD 085

92 BUSINESS UPDATES ANNUAL REPORT Our China Main Office is located in Shanghai 02 Construction works for the Lushan Water Supply Project,China Luancheng Dayu Water Supply Project Sino Water s 80% owned China subsidiary, Luancheng Dayu Water Co Ltd is undertaking the Luancheng Dayu Water Supply Project, which is located in the Luancheng County in Shijiazhuang of the Hebei Province. The takeover of the project company, Luancheng Dayu Water Co Ltd was completed in January 2010 and the relevant formalities and processes are ongoing to enable Sino Water to take over the said Project. A new 10 and 50 MLD WTPs will be constructed to meet the estimated domestic and industrial water demands respectively, including the implementation of a pipe replacement programme to reduce the non-revenue water (NRW) losses. Yuanshi Industrial Water Supply Project Sino Water s 80% owned subsidiary, Hebei Sino Panlong Industrial Water Supply Co Ltd is undertaking Yuanshi Industrial Water Supply Project, which is located in the Hebei Province. Yuanshi Industrial Water Supply Project involves the takeover and operation of Phase One of 10 MLD trunk main to supply water for industrial consumption in Yuanshi County under the joint venture company, Hebei Sino Panlong Industrial Water Supply Co Ltd. This 30-year industrial water supply project has been awarded through an Industrial Water Supply Project Concession Agreement executed between Sino Water and the Water Bureau of Yuanshi County on 31 December Hebei Sino Panlong Industrial Water Supply Co Ltd had taken over the existing industrial water supply operations in February INDIA The growing population of India coupled with industrialisation and urbanisation in the sub-continent has resulted in demand for sustainable development and efficient management of water resources. This is key to economic growth and poverty alleviation, given that 70% of the population is dependent on agriculture. In India s Budget , the allocation for the Rajiv Gandhi Drinking Water Mission was increased to Rs7,300 Crore. Rs200 Crore was allocated for drinkable water in the schools while Rs300 Crore was assigned for a desalination plant at Chennai for facilitating the production of clean drinking water (Source: India Budget ). Chennai Water Supply Augmentation Project 1, India In India, PNHB together with Lanco Infratech Limited via the PNHB-LANCO-KHEC Joint Venture ( Joint Venture ) continued to operate and maintain the Chennai Water Supply Augmentation Project 1 ( Chennai Water Project ) Package III. The Joint Venture had completed the construction work in The Operation & Maintenance (O&M) service contract will end on 31 May 2010 and may be extended further until a new operator is appointed via a tender exercise. Accordingly, the Joint Venture is also participating in the said tender exercise. PUNCAK NIAGA HOLDINGS BERHAD 086

93 ANNUAL REPORT Construction works for the Lushan Water Supply Project,China 04 Degremont Pulsator clarifier at Pipri Old WTP, Karachi, Pakistan Telibong and Telipok Projects, Sabah The WTP can treats and supplies 80 million litres of treated water per day to residential developments, industrial parks and tourist resorts in the Tuaran area. PNHB is the Turnkey Subcontractor of the Project. The scope of works include the design and construction of the WTP, intake, off river storage, two reservoirs and pipe laying. The project is completed and PNSB is currently undertaking the two years maintenance of the WTP which expires upon the expiry of the 24 months project s defect liability period on 31 October PAKISTAN Our ongoing collaboration with Karachi Water and Sewerage Board (KWSB) of Pakistan via the execution of a Memorandum of Agreement with KWSB and the Asian Development Bank (ADB) to form a voluntary partnership with KWSB to be implemented and financed by ADB as a South Asian Water Utilities Network activity as part of the Water Operators Partnerships Programme has been extended to 30 June The collaboration enables PNSB to share its experience on how good practices may be used to improve its operating practices including water quality testing processes and assist KWSB in improving operational efficiency of one of the water treatment plants located at Pipri, focusing on water production and quality. It is currently at the stage of training the plant staff. THE OVERALL AMOUNT OF WATER ON OUR PLANET HAS REMAINED THE SAME FOR TWO BILLION YEARS Since inception of the programme, three activities out of the six activities identified have been completed todate, namely the plant appraisal, field study by KWSB and development of plant procedures. The remaining three activities namely, training, implementation by KWSB and evaluation/review by PNSB are scheduled to complete by 30 June Seven personnel from KWSB had visited PNSB from 28 July until 3 August KWSB staff were exposed to various water treatment technologies such as the Actiflo system, an advanced water clarification system and the dissolved air floatation and membrane technology. The visit has provided KWSB the opportunity to observe the results of implementing good operational practices and to gain a better understanding on the need for adopting a systematic management system in operation and maintenance of a WTP including strict water quality control as well as the awareness on safety at workplace. PUNCAK NIAGA HOLDINGS BERHAD 087

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95 DELIVERING SERVICE EXCELLENCE Our customers continue to benefit from our services. Our aspiration is to exceed our customers expectations at every point of contact to provide a customer experience second to none. ACHIEVED 93.8% COMPLIANCE FOR DEALING WITH WATER QUALITY COMPLAINTS WITHIN 30 MINUTES

96 IMPROVING CUSTOMER SERVICE ANNUAL REPORT Launching of new PUSPEL Logo and service motto 02 New PUSPEL Logo and PUSPEL on Twitter and Facebook on Our Customer Service Division at SYABAS (better known as PUSPEL) provides customers with a convenient and effective one-stop centre to receive, manage and provide answers or solutions to all water and water supply related questions including concerns from consumers in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya. Manned by a team of highly trained call agents based at SYABAS Head Office at Jalan Pantai Baharu, Kuala Lumpur and the ten District Offices ( Call Agents ), PUSPEL operates 24 hours daily the whole year round. PUSPEL reaches out to the consumers via toll-free number, facsimile, Short Messaging Service, s and letters. We launched our new PUSPEL logo with the service motto Friendly, Committed and Trusted on 10 January 2009 as a symbol of our ongoing commitment and relentless efforts to provide the best services to our consumers in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya. On 14 January 2010, we launched PUSPEL on the social networks, follow@puspel on Twitter and Facebook to allow our consumers to connect with SYABAS and allow them to lodge their complaints or queries easily and effortlessly. This will also enable SYABAS to reach out to our consumers who are avid netizens and to share invaluable information directly and more effectively with these group of consumers. Dealing with consumers from all walks of life and managing the consumers expectations is indeed very tough and challenging in particular, for our front line employees, the Call Agents. Since SYABAS is committed to be The Supplier Of Quality Clean Water, all employees at PUSPEL Counter Services are expected to inculcate the SMART commitments in the discharge of their daily duties, namely: S Smile M Manage complaints and enquiries from walk-in consumers A Accessible R Reliable T Timely To ensure consistency in PUSPEL s services throughout the ten District Offices, a Standard People Practice Handbook (SPPH) with code of behaviour for our front line employees, and the Service Counter Ethical Code (MESRA) were developed and implemented. Additionally, our Managers continuously conduct training, counselling and provide the necessary support to our front line employees to ensure that our employees provide the best of services in line with our service motto, Friendly, Committed and Trusted. To help our employees relieve their stress from dealing with consumers daily, we have a scream room where highly stressed employees are encouraged to use the scream room to de-stress themselves. More details on how we manage our employees and provide them with the necessary means to help us achieve our key objectives and targets are detailed in the section Engagement With Our Community in page 114 of this Annual Report. PUNCAK NIAGA HOLDINGS BERHAD 090

97 ANNUAL REPORT Attending to consumers queries and complaints 04 PUSPEL s Call Agents attending to telephone calls Contact Centre Statistics Since 2005, PUSPEL have been dealing with a high number of calls as shown in the table below. It is our policy that all consumers complaints received by PUSPEL are attended to and addressed immediately. With this determination and commitment instilled in our front line employees, the average percentage of calls answered in 2009 was 98% and the average total handling time per call is 2 minutes and 50 seconds against the Key Performance Indicator ( KPI ) of 3 minutes 30 seconds. PURE WATER HAS A NEUTRAL PH OF 7 PUSPEL s calls records for the past five years are shown below: Calls Received 462, , , , ,970 Cases for investigation and remedial action 160, , , , ,430 Remaining Calls 301, , , , ,540 The remaining calls as shown in the table were either repeat calls, calls on same issues or complaints lodged earlier by other consumers, general enquiries on payments and billings, reporting pipe bursts and pipe leaks, seeking for direction to SYABAS District Offices, requests for the phone numbers of SYABAS District Offices, checking on account status, etc. A breakdown of the various cases for investigation and remedial action for the year 2009 is provided below: Type of Cases for 2009 for investigation and remedial action Case No. of Cases Water Supply 174,164 Billing 17,495 Meters 4,487 Disconnection 8,284 Total 204,430 In March 2009, SYABAS set another KPI whereby all water quality complaints must be initially responded within 30 minutes (1/2 hour) by the Water Quality Department from the time the call is received ( New KPI set ). We are pleased to announce that as of 31 December 2009, we had achieved 93.8% compliance with our New KPI set for dealing with the consumers water quality complaints. PUNCAK NIAGA HOLDINGS BERHAD 091

98 CONSUMER AWARENESS AND EDUCATION PROGRAMME ANNUAL REPORT Briefing to the delegation from Taiz Water Supply & Sanitation Local Corporation of Republic of Yemen 02 YBhg Dato Ir Lee Miang Koi, SYABAS Chief Operating Officer briefing the delegates from the Water Department of Guangdong, China during their official visit to SYABAS Head Office We are encouraged whenever we receive compliments from the consumers for our services and support and in 2009 alone, we received a total of 227 commendations from our consumers for jobs well done and for this, we thank our consumers for the direct support shown to us and our employees, which has motivated and made us even more determined to serve the consumers better. Visitors are always welcome to visit our PUSPEL Contact Centre as we encourage knowledge sharing and exchange of information as well as to discuss areas of common interests in relation to treated water supply. In 2009, SYABAS hosted the following visits by various water agencies, universities and government agencies, both local and overseas, at SYABAS Head Office: Visitors Date of Visit Syarikat Air Negeri Sembilan 15 January 2009 Water Department of Guangdong, China 16 January 2009 Luancheng County Government, China 7 April 2009 CEO Inmind, Encik Norizan Sharif 15 May 2009 Lembaga Air Sibu, Sarawak 21 May 2009 EXCO Kerajaan Negeri Kedah 8 June 2009 Syarikat Air Negeri Sembilan 10 June 2009 Khong Co Chi, Vietnam 22 June 2009 University Banda Acheh, Indonesia 24 June 2009 ACWA Power International, Saudi Arabia 29 June 2009 Lembaga Air Perak 15 July 2009 TAIZ Water Supply & Sanitation, Yemen 21 July 2009 Jabatan Bekalan Air Pahang 28 July 2009 Karachi Water & Sewerage, Pakistan 31 July 2009 EXCO Kerajaan Negeri Selangor 7 August 2009 EXCO Kerajaan Negeri Kelantan 7 August 2009 SS2 Residence Association 14 August 2009 Confservizi Vento, Italy 25 November 2009 Government of Sri Lanka 25 November 2009 PNSB also hosted several local and foreign delegations namely, the Water Department of Guangdong China, Luancheng County Government China, EXCO Kerajaan Negeri Kedah, YB Dato Dr Hassan Mohamed Ali, the Selangor EXCO for Islamic Affairs, Malay Customs, Infrastructure and Public Amenities and Iranian Delegation at PNSB s Head Office, Dams and WTPs. PUNCAK NIAGA HOLDINGS BERHAD 092

99 ANNUAL REPORT School students listening to a briefing by SYABAS personnel 04 Consumer Awareness Talks and water quality demonstrations are frequently conducted by SYABAS UNIT KERJASAMA INFORMASI PELANGGAN (YAKIN) YAKIN is a unit of the Customer Service Department of SYABAS, specifically set up to meet the needs of the domestic consumers in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya. YAKIN is community based and its objective is to reach out to residential consumers via the Ketua Kampung/Community Leaders through site visits, briefing on pipe replacement program and dialogue sessions to better understand the consumers problems and needs via various activities and programmes. In 2009, YAKIN at our 10 District Offices focused on collecting and updating consumers data. As of 31 December 2009, YAKIN has collected and compiled details of 7,759 Ketua Kampung/Ketua Taman/Pengerusi Jawatankuasa Keselamatan Kampung in its database. This database will enable YAKIN to send out advanced automated water disruption notices to inform the consumers of any scheduled and unscheduled water disruptions in their respective areas. AT BIRTH, AN INFANT S BODY WEIGHT IS MADE UP OF 80% WATER INDUSTRIAL CONSUMER UNIT (ICU) ICU was set up with the objective of providing customer service to industrial consumers on water supply related matters and problems. The ICU continues to promote public relations, rapport and visibility through visitation to the industrial consumers and trade associations and by sending advance notice on scheduled maintenance and handling cases reported by the trade consumers. CONSUMER AWARENESS AND EDUCATION PROGRAMME The Consumer Awareness and Education Programme (CAP) with media coverage is ongoing with more emphasis on consumers responsibilities in the maintenance of their own internal plumbing system and internal storage tanks. From January 2009 until March 2009, five CAPs per month were targeted for each District and the target was further increased to eight CAPs per month beginning from April CAP Performance for the ten Districts, namely Petaling, Klang, Kuala Lumpur, Gombak, Hulu Langat, Sepang, Hulu Selangor, Kuala Langat, Kuala Selangor and Sabak Bernam for the period from 1 January December 2009 are illustrated below: Types of Premises Visited Medical Education Commercial Consumer TOTAL Total Premises Visited for the ten Districts Each District has a target of 87 premises to be visited for the year 2009, giving an overall total target of 870 CAPs for the year Thanks to the unwavering commitment and hard work of our employees, we are pleased to report that the total CAPs performed for the year 2009 was 957 CAPs, which exceeded the target of 870 CAPs. PUNCAK NIAGA HOLDINGS BERHAD 093

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101 VALUING OUR PEOPLE We seek to create a positive and dynamic work culture where our people feel a sense of belonging and are proud to work for the Group and, in return, receive the recognition and reward they deserve. We further seek to create a workplace where every individual is given the opportunity to develop his or her career potential to the maximum. 83.3% OF THE GROUP S WORKFORCE WERE SENT FOR TRAINING, LOCALLY AND ABROAD IN 2009

102 BUILDING OUR PEOPLE ANNUAL REPORT PNSB s Monthly Staff Assembly at Wisma Rozali 02 We strive to create a happy and healthy workplace for our employees EMPLOYEE PROFILE We are committed to promoting equality amongst all our employees and welcome diversity in all aspects of our business practice. Our aim is to harness the talents of the diverse community in which we operate to help enhance our Group s performance and success. Our Vision, Mission and Puncak Values require us to meet our obligations whilst maintaining an ethical and professional standards as well as focusing on care and respect for all our employees. Our employment policy is very open with equal opportunities for all irrespective of race, gender or religion. We value a work force that is highly committed, competent, diligent and fully supportive to help realise our Vision and Mission. As at 31 December 2009, our Group employed 4,037 employees, of which 226 (5.6%) are Management staff, 724 (18%) are Executive staff and 3,087 (76.4%) are Non-Executive staff as compared with 4,188 staff as at 31 December 2008, a slight decline of 3.6%. Our average staff turnover rate for 2009 of 6.8% is low given the 2009 national average employee turnover rate of 18% (Source : International Human Resource Consulting Firm, Hewitt Associate s 2007 Total Compensation Management Survey). In terms of racial composition for our Group manpower as at 31 December 2009, the breakdown comprised 88% Malays, 5% Chinese, 6% Indians and 1% of other races (please refer to PNHB Fact Sheet at page 022 of this Annual Report). Gender Diversity Our Group s employment by gender is skewed at approximately 3:1 (Men : Women) due to the nature of our business which involves a lot of fieldwork, repair and maintenance works at any time of day, round the clock. However, based on the gender data from our Executive and Management personnel, the ratio is almost 1:1 at 422 women employed compared to 528 men. PUNCAK NIAGA HOLDINGS BERHAD 096

103 ANNUAL REPORT Our employees enjoy good Benefits Package and a healthy and safe workplace with good facilities 04 Oath-taking during SYABAS Monthly Staff Assembly EMPLOYEE BENEFITS Our Group offers a comprehensive Employee Benefits Package that consider the general welfare of our employees. These include insurance coverage for the immediate family, housing and car loan interest subsidies, interest-free assisted education loans as well as Tabung Kebajikan, computer and personal loans. Both PNSB and SYABAS also contribute a higher than the statutory rate of employer s contribution to the Employees Provident Fund (EPF) for employees who served more than two years. Our employees and their dependants enjoy medical benefits that cover outpatient treatment, hospitalisation and surgical, dental expenses with the exception of dental benefits which is only extended to the employees only. The Group also offers maternity benefit for a maximum of up to five surviving children. WATER PROTECTS THE HUMAN EYE To ensure we retain a productive and motivated workplace, our Group offers highly competitive salary packages.through Malaysian Employers Federation (MEF), we will review the employees benefits existing in the market place from time to time to ensure that our employees are adequately remunerated at all times and in accordance to prevailing market conditions and the cost of living. In terms of employees remunerations in 2009, PNHB Group s payment of salaries, bonuses, defined contribution plans and other expenses increased by approximately 2.6% from 2008 due to annual increment and higher bonus payout to top performers. Being an essential service provider, we require our employees, especially the operations and site employees to put in long working hours round the clock under very challenging site conditions. Hence, we provide the necessary benefit packages, facilities and assistance to ensure that the well-being and safety of our employees are well taken care of at all times and that they are continuously appreciated and rewarded for their hard works. RECOGNISING OUR EMPLOYEES SUPPORT At PNSB, to recognise good works and motivate productivity, employees with excellent performances are duly awarded with merit bonuses. Besides merit bonuses, outstanding employees who were STAR Performers for 2009 were also recognised and were awarded the Anugerah Kakitangan Cemerlang whilst long serving employees (10 years and above) were recognised via the Long Service Award. Similarly at SYABAS, excellent performers are awarded with merit bonuses, salary increments and promotions. In appreciation of the employees contributions, SYABAS also holds staff appreciation dinners themed Majlis Jasamu Dikenang for retired employees. PUNCAK NIAGA HOLDINGS BERHAD 097

104 BUILDING OUR PEOPLE ANNUAL REPORT SSP2 WTPs Book Fair attracted the interests of our employees children 02 SYABAS was awarded the Bronze Medal from Malaysian HR Award RETAINING AND CAREER DEVELOPMENT OF EMPLOYEES PNSB Performance Appraisal Exercises are conducted for all our confirmed employees twice a year. The objectives of the appraisals are: To conduct a systematic evaluation of an employee s performance against agreed performance expectations on the job. To evaluate staff effectiveness and determine their potential for advancement in the Company. The Independent Employees Performance Review Committee (IEPRC) is responsible to review, evaluate and harmonise the assessment and scoring as rated by the Heads of Departments/Divisions who will then make the final recommendation to the Executive Committee (EXCO) for approval and decision on the appropriate rewards based on the individual performance of the employees and the Company s performance. The IEPRC will also make recommendations to the EXCO on the appropriate actions to be taken against those staff whose performance are not up to the Company s performance requirements. Every employee will be notified on the final rating as approved by EXCO. Non performing employees will be counseled and their performance will be reviewed for six months on monthly basis. SYABAS Similarly, SYABAS has a human capital retention policy of maintaining the best employees and ensuring that our employees develop as we grow. With a robust employee evaluation process in place, our employees have the opportunity to gauge for themselves their performance bi-annually which is reflected in our annual review process for promotions and salary reviews. Non performing employees will be counselled and their performance reviewed after six months. The effort in managing the Human Resource at SYABAS have been recognised by the Malaysian Institute of Human Resource Management (MIHRM) where SYABAS had been awarded with the bronze medal under the Human Resource Excellent Category on 25 March With a structured performance evaluation framework in place and with emphasis for self development and career development, we believe that we have managed to retain and groom the best employees in the Group. PUNCAK NIAGA HOLDINGS BERHAD 098

105 ANNUAL REPORT Majlis Berkhatan Anak-anak Kakitangan Anjuran PEKA 04 Our employees participating in the Merdeka march TRAINING We are strongly committed to training and developing our employees for the benefit of the Group and of the individual. The thrust of our training programme is to prepare a workforce that is capable of meeting the challenges of a knowledge-based and demanding industry as well as to enhance the productivity and competitiveness of the organisation. At the same time, the training modules are oriented to close competency gaps, improve performance and enhance knowledge, skills and expertise to support the Group s Vision and Mission. The guiding principles of our training policies are: All employees should be trained and retrain to keep them relevant and competent to perform their jobs. All employees should be given equal opportunity to attend training. The training budget should be utilized responsibly on need basis. Training should not end in the classroom but to be conscientiously applied at the workplace. Our employees should take training in a similar spirit of discharging their other important daily tasks. GROUNDWATER SERVES ABOUT 80% OF THE POPULATION, OF WHICH UP TO 4% OF USABLE GROUNDWATER IS POLLUTED In 2009, PNSB trained approximately 61% of its employees while SYABAS conducted training for 91% of its employees. On average, approximately 83.3% of the Group s workforce attended training in 2009 as follows: Trainings Conducted In 2009 PNSB SYABAS Total Management (Including Directors) Executive Non-Executive 350 2,055 2,405 Total 569 2,698 3,267 % of Employees Trained 61% 91% 83.3% Note: For both companies, majority of the training were provided to the non-executive employees. PUNCAK NIAGA HOLDINGS BERHAD 099

106 BUILDING OUR PEOPLE ANNUAL REPORT Water Quality Programme Training 02 SCADA Command Centre Training: Video Wall The Group spent approximately RM550,000 on training in 2009, as follows: Category PNSB (RM) SYABAS (RM) Total (RM) In-House 138, , , External 266, , , Total 404, , , The breakdown in terms of training categories and participants is shown below: PNSB SYABAS Total Training No. of Training No. of Training No. of Programme Participants Programme Participants Programme Participants Personal & Leadership Development Positive Mindset Functional/Knowledge , ,293 Supplementary Knowledge , ,814 External Courses (Local/Overseas) Total 143 1, , ,893 Note: The same person may go for more than one training New employees in PNSB must undergo a 2-day Induction Programme whereas SYABAS new recruits are required to undergo a 3-day New Employees on Board Programme. LISTENING TO OUR PEOPLE Working with our employees in partnership is vital in helping us create long term growth for the business and for our employees. It means building a shared vision of the business within the competitive environment. PUNCAK NIAGA HOLDINGS BERHAD 100

107 ANNUAL REPORT Our Innovative and Creative Circle programme in progress employees participated in our Majlis Ibadah Qurban held at Wisma Rozali We constantly engage and interact with all our employees through our Monthly Staff Assemblies and staff meetings at Divisional and Departmental levels. Our Senior Management adopts a hands-on approach and engage with our employees regularly. Listening to our employees, acting on their views and involving them in improving our business is very important to us. We encourage a two-way communication for all levels at the workplace vis-à-vis sharing information and knowledge. WATER FREEEZES AT 0 CELCIUS ENSURING QUALITY In line with good governance and fostering relationships with our stakeholders, the Group have several Codes of Conduct and Policies which express and support the strategies that will steer the Group to achieve its KPIs. These Codes are: PNHB Corporate Disclosure Policy Information Technology Policies i.e Software License Policy, IT Security Policy and Copying Software Statement Investor Relations Policy Health, Safety & Environment Policy Quality Policy Risk Management Policy Sexual Harassment Policy SYABAS Quality Telephone Ethics Standard People Practices Handbooks Sexual Harassment Policy Corporate Responsibility Policy Statement Code of Business Ethics Service Counter Ethical Code Health, Safety and Environment Policy PUNCAK NIAGA HOLDINGS BERHAD 101

108 BUILDING OUR PEOPLE ANNUAL REPORT World Water Day 2009 celebration at Sabak Bernam District Office 02 Our employees participated in the Maulidur Rasul 1430H/2009M celebration at Merdeka Square, Kuala Lumpur CARING FOR OUR PEOPLE Persatuan Kakitangan Bekalan Air Selangor, Wilayah Persekutuan Kuala Lumpur dan Putrajaya (PEKA) or Association of Water Supply Workers for Selangor, Kuala Lumpur and Putrajaya comprising members from PNSB and SYABAS was set up on 15 September 2006 to provide welfare, foster social and cultural bonding and stimulate advancement of the Group s employees and other community in general. Since its inception, PEKA has organised many programmes for its members and these programmes have over the past years created a sense of belonging and togetherness, loyalty, perseverance and acceptance within the Group and this is in line with the 1Malaysia concept promoted by our Honourable Prime Minister, YAB Dato Sri Mohd Najib Tun Haji Abdul Razak. Our Executive Directors and Senior Management frequently participate in these programmes to give support and encouragement to the members. In 2009, PEKA organised the following programmes: 1. Sambutan Maulidur Rasul 52 of our employee members participated in Perhimpunan & Perarakan Sambutan Maulidur Rasul 1430H/2009M which was held on 9 March 2009 at Dataran Merdeka, Kuala Lumpur officiated by Yang di-pertuan Agong Al-Wathiqu Billah Tuanku Mizan Zainal Abidin Ibni Almarhum Sultan Mahmud Al-Muktafi Billah Shah. 2. Kem Ibadah & Motivasi Anak Soleh The event was successfully held on 14 to 16 March 2009 at Masjid Ar-Rahimah, Kuala Kubu Bharu, Selangor. 33 children of SYABAS and PNSB s employee members aged between 10 until 15 years participated in the event. 3. Third Annual General Meeting of PEKA (3rd AGM) PEKA s 3rd AGM was held on 28 March 2009 at INTEKMA Resort & Convention Centre, Shah Alam, Selangor with the attendance of approximately 350 members. YBhg Dato Ruslan Hassan, the Chief Executive Officer of SYABAS officially launched PEKA s website and presented Saguhati and certificates to 46 employee members children who obtained good results in the 2008 UPSR and PMR examinations. PUNCAK NIAGA HOLDINGS BERHAD 102

109 ANNUAL REPORT PNSB s Hari Raya Aidilfitri Open House in Wisma Rozali 04 PEKA s Bubur Lambuk event during Ramadhan 4. Karnival Sukan PEKA 2009 The above annual sports carnival was successfully held with strong participation from our employee members as follows: Futsal Competition held on 4 April 2009 at the Rear Sports Arena, Sg Pulai Klang, Selangor. Volleyball Competition held on 4 July 2009 at Kompleks Sukan Bank Simpanan Nasional and Maktab Perguruan Islam, Bangi. Badminton Competition held on 18 July 2009 at Michael s Badminton Academy (MBA), Puchong. Pingpong & Carom Competition held on 15 August 2009 at Dewan Sri Bernam, Sg Besar, Sabak Bernam. Sepak Takraw Competition held on 7 November 2009 at Kompleks Sukan Lelaki, Universiti Islam Antarabangsa, Gombak, Selangor. 97% OF THE EARTH S WATER IS IN THE OCEANS Other sporting events organised in 2009 include: 1. Fishing Competition held on 18 April 2009 at Kolam Pancing Sea Lion, Bagan Hailam, Port Klang, Selangor. 2. Bowling tournament held on 13 June 2009 at Megalanes, Sunway Pyramid. 3. An expedition to climb Bukit Kutu on 24 and 25 October PEKA also organised fund raising and employee volunteerism programmes to help charitable organisations, such as: 1. Charity Golf Event held on 25 July 2009 at Nilai Springs & Country Club. RM13, was successfully raised. 2. Employee Volunteer Programme held on 29 August 2009 to provide assistance to Rumah Ibadat Sri Maha, Bukit Sentul involving gotong royong, painting of temple wall, cooking nasi manis, dance performances and colum competition. 3. Bubur Lambuk Programme held on 2 September 2009 at Wisma Rozali with the employees helping to cook Bubur Lambuk and distribute 350 packets of Bubur Lambuk to all employees (Muslim and non-muslim). PUNCAK NIAGA HOLDINGS BERHAD 103

110 BUILDING OUR PEOPLE ANNUAL REPORT Induction Programme for new employees 02 PUSPEL call agents giving the thumbs up consistent with their new service motto, Friendly, Committed and Trusted 4. Majlis Berbuka Puasa Kakitangan PNSB & SYABAS Meraikan Anak-Anak Yatim bersama YB Dato Sri Peter Chin Fah Kui, Menteri Tenaga, Teknologi Hijau & Air sempena Lawatan Kerja YB Datuk Menteri di Loji SSP2 held on 15 September 2009 at Sg Selangor Phase 2 WTP ( SSP2 WTP ). Approximately 800 people attended the event which include the local community (children and the elderly). PEKA also invited anak-anak yatim, keluarga angkat, pesara and ibu tunggal for the function as penerima sumbangan duit raya. 5. Visit to the Ti-Ratana Welfare Society on 10 October 2009 involving free hair cuts for the old folks, special performances by Ti-Ratana orphanage and water quality testing. 6. Majlis Ibadah Qurban held on 30 November 2009 at Wisma Rozali attended by 180 employees (Muslim/ Non-Muslim). Nine cows were slaughtered for the Qurban and 720 kilograms of Qurban meat were distributed to the following orphanages and old folks homes: Asrama Anak Yatim Darul Izzah, Bangi, Selangor; Asrama Anak Yatim Darul Fuqaha, Sg Merab, Kajang, Selangor; Asrama Damai Anak Yatim Kuang, Kuang, Selangor; Rumah Kasih Harmoni, Kg. Paya Jaras, Selangor; Pondok Penyayang Raudah, Batu 11 Gombak, Selangor; Asrama Anak-Anak Yatim Qanaah, Taman Greenwood, Gombak; Rumah Jagaan Nurhikmah, Taman Mesra, Kajang, Selangor; Asrama Penyayang Nur Iman, Setapak, Kuala Lumpur; Rumah Amal Siraman Kasih, Bandar Country Homes,Rawang, Selangor; Asrama Anak Yatim Baiduri, Dengkil, Selangor; Asrama Anak Yatim Dan Miskin, Kuala Langat, Selangor; and Rumah Lindungan Anak Yatim Dan Miskin, Kota Warisan, Sepang, Selangor. 7. Study visit to the Air Force Museum on 3 December 2009 and 10 December 2009 at Sg Besi, Kuala Lumpur involving 112 children of employee members of SYABAS and PNSB. PUNCAK NIAGA HOLDINGS BERHAD 104

111 OCCUPATIONAL HEALTH & SAFETY ANNUAL REPORT & 04 Our employees engaging in group discussion and meeting on operational matters ENSURING HEALTH AND SAFETY PNSB As a responsible employer, we seek to provide a healthy and safe workplace for our employees. Throughout 2009, we have conducted the following: Chemical Health Risk Assessments (CHRA) at our WTPs to evaluate the extent of chemicals exposure faced by our employees at our WTPs in compliance with Occupational Safety and Health (Use and Standards of Exposure of Chemicals Hazardous to Health) Regulations Industrial Activity Report (CIMAH Report) to assess the risks in relation to the health and safety of our WTPs, our employees and the local communities near our WTPs in the event of industrial major accidents, in compliance with Occupational Safety and Health (Control of Industrial Major Accidents Hazards) Regulations ABOUT 6,800 GALLONS OF WATER IS REQUIRED TO GROW A DAY S FOOD FOR A FAMILY OF FOUR Health and safety induction training, health and safety awareness training, first aid training, first aid refresher training, fire-fighting and handling of fire-fighting equipment training, mock drills and ERP training, etc at all the 29 WTPs and the three Dams to train employees to be responsive and ready in the event of emergencies and in compliance with our health and safety measures which require our employees and permanent contractors to be adequately trained in three categories i.e Statutory Requirements Competency Training and General Training. All our employees at the WTPs and Dams are required to undergo a minimum of four man-days of training annually while permanent contractors must undergo at least one man-day of training a year. A briefing on the procedures to be adopted and to be aware of during the outbreak of the Influenza A H1N1 virus at the Head Office and at all the WTPs. The objective of these programmes is to ensure that all our WTPs and Dams comply with the health and safety regulations and adhere to the health and safety management system established within the Company. In the process, matters such as adequate signages as well as proper labelling and storage of chemicals, proper upkeep of plants and usage of personal protective equipment at the workplace were also closely monitored. PUNCAK NIAGA HOLDINGS BERHAD 105

112 OCCUPATIONAL HEALTH & SAFETY ANNUAL REPORT SYABAS Employee Safety Handbook for the workplace 02 Cardio-pulmonary resuscitation training for our employees Emergency Preparedness In our preparation to respond to any incident of chlorine leak, 48 employees were sent for specialized training on Chlorine Safe Handling at the respective supplier s plant. ERP drills were conducted to familiarize and to measure the level of readiness of our employees in responding to unforeseen crisis situations. In addition, our Safety and Health Officer has conducted 31 scheduled Site Safety Inspections (SSI) covering all WTPs and Dams annually. External Inspections Apart from our internal inspections programmes, we are also visited by external parties namely, officers from the Department of Occupational Safety and Health (DOSH) of Selangor, Kuala Lumpur and Headquarters. Several WTPs were audited on matters pertaining to industrial hygiene, CIMAH Regulations and factory and machineries certification inspection. We are pleased to announce that PNSB is in full compliance with the statutory requirements regulated by DOSH. Lost Time Injury (LTI) We are proud to announce that since its commission in July 1998, SSP2 WTP has demonstrated a high level of commitment to health and safety standards at the workplace and has its practices and procedures followed the Integrated Management System covering ISO9000 (Quality), ISO (Environment) and OHSAS (Safety) Management Systems. On 15 February 2009, SSP2 WTP achieved the milestone benchmark of 3,000,000 man-hours of ZERO Lost Time Injury (LTI), one of the major elements used as an indicator of safety performance adopted internationally by most industries and a testament to the employees high level of awareness and commitment on health and safety standards. It is worthy to note that since September 2002, the LTI has included contractors and suppliers man-hours after they have undergone extensive health and safety training and familiarisation at SSP2 WTP. Besides SSP2 WTP, the rest of the workplaces including 23 WTPs and three Dams have also achieved ZERO LTI ranging from 1,000 to 4,000 free days. Our weeklong Corporate Safety and Health Week Campaign in January 2010 was officially launched by the Director General, Department of Occupational Safety and Health (DOSH), YBhg Dato Ir Dr Johari Basri. 10 organisations participated in the exhibition and a blood donation campaign was conducted. Seven sessions of health and safety talks from various organisation such as DOSH, Bomba, PDRM, SOCSO, etc. were also organised during the safety and health week, which was attended by all levels of employees from our workplace. PUNCAK NIAGA HOLDINGS BERHAD 106

113 ANNUAL REPORT Confined Space Safety training in progress 04 Safety harnesses training for the contractors SYABAS SYABAS Occupational Safety and Health (OSH) Programmes and guidelines focuses on ensuring that our employees and contractors are able to work in a safe and healthy workplace at all times. Apart from ensuring legal compliances, our OSH Programmes and guidelines have been coordinated to ensure that we are able to harmonise and make OSH part of the workplace culture. The effort has been recognised by MSOSH and SYABAS have been awarded with the Silver Award in the MSOSH OSH Award 2008 on 1 August Lost Time Injury (LTI) The accumulated free LTI man-hours recorded at SYABAS from April 2007 until end of December 2009 stood at 13,922,357 hours; with ZERO LTI in As of 31 December 2009, 186 SSIs have been conducted, of which 68 non-conformances (NCR) were raised. As of to date, all NCRs raised have been resolved. A PERSON CONSUMES MORE THAN 16,000 GALLONS OF WATER IN HIS LIFE TIME Emergency Preparedness SYABAS contractors are also required to undergo a safety briefing conducted by our Health, Safety and Environment (HSE) Department prior to working on site. We conducted six safety briefings to the new contractors in 2009; each contractor was given a copy of our Safety Guideline for Contractor booklet. A briefing on Working in Confined Space was also conducted for all our employees and our contractors employees on 8 May 2009 and 1 June 2009 respectively to ensure that safety requirements in confined spaces are complied with. In tandem with our target of obtaining the OHSAS Health & Safety Management System (OHSAS HSMS) Certification by 2011, we established and implemented the OHSAS HSMS at the Head Office and at all 10 District Offices. A series of briefings were conducted to enable our employees to gain a better understanding of the various processes and procedures developed. As part of our OHSAS HSMS, we developed the Hazard Identification, Risk Assessment and Control (HIRAC) Form to enable our sites to identify potential hazards from work activities. We also conducted an internal documentation audit from 16 November 2009 to 10 December 2009 at all the District Offices to assess and evaluate the OHSAS HSMS documents and records in ensuring all our documents and procedures are kept in proper order. All non-conformities raised were rectified within two weeks. In our efforts to maintain a safe and healthy working environment, we developed and introduced our Employee Safety Handbook in April 2009 to guide our employees on legal compliances and health and safety best practice requirements. PUNCAK NIAGA HOLDINGS BERHAD 107

114 OCCUPATIONAL HEALTH & SAFETY ANNUAL REPORT PNSB s Hari Raya Open House at Wisma Rozali 02 Utilising IT solutions at the workplace To ensure that we are always prepared for emergencies, we conducted three fire fighting training sessions with Jabatan Bomba dan Penyelamat at SYABAS Headquarters and Kuala Lumpur District Office on 1 July 2009, 2 July 2009 and 7 December We also carried out five fire drills at our District Offices in Sabak Bernam, Kuala Langat, Hulu Selangor, Sepang and Klang. These fire drills were conducted together with Jabatan Bomba & Penyelamat and Jabatan Kesihatan, who acted as the Programme Observer. As of 1 March 2009, all our premises have been gazetted as No Smoking zones. To educate our employees on the new initiative, we, together with the Ministry of Health, launched an awareness campaign with the objective of cultivating a healthy working environment by conducting briefings on smoking hazards. Posters highlighting the hazards of smoking were displayed at all our premises, offenders are fined with monetary penalties. Influenza A H1N1 Virus With the outbreak of the Influenza A H1N1, our employees are considered at high risk in terms of exposure to the Influenza A H1N1 virus, as our activities involves high interaction with the general public. To protect our employees, we established a procedure to mitigate the spread of the disease in August 2009 and conducted a briefing on the procedure to all employees at the Head Office and the District Offices. SECURITY SERVICES The security of the Group s properties and other assets and curbing water theft is a matter of high priority and is undertaken by the Group s in-house auxiliary police, which is more reliable than an external security services provider. All of our 301 Auxiliary Police personnel are trained by the Royal Malaysian Police Force at the Police Training Centre located at Jalan Semarak, Kuala Lumpur (PULAPOL). Their assignments and general duties include: Responsibility for all security matters of the Company. To play an advisory role to all associate companies. Provide support services to other Departments on security matters and investigating water theft cases. Liaison with relevant government agencies. Investigate any security matters arising. Respond to the Chief Government Security Office on administrative matters especially on key point areas, restricted & prohibited areas. PUNCAK NIAGA HOLDINGS BERHAD 108

115 AT THE MARKETPLACE ANNUAL REPORT Remedial works were undertaken immediately at the site of the burst pipe at the DUKE highway 04 Strict adherence to safety guidelines at all our work sites Managing our Suppliers/Contractors To deliver efficient and high quality services to consumers, SYABAS must ensure that only high quality work/ services are carried out by its contractors. To achieve this goal, SYABAS has carried out the prequalification and registration of contractors whereby only competent contractors are shortlisted and registered to undertake SYABAS project. To date, a total of 1,166 contractors/suppliers/consultants had been registered with SYABAS, the details of which are as follows: A SMALL DRIP OF WATER CAN ADD UP TO 25 GALLONS PER DAY Category of Contractors/Suppliers No. Work 457 Supply 372 Services 326 Specialist 11 Total 1,166 We do not condone contractors who are unable to provide proper services and putting us and the consumers at risk causing water supply disruptions and other inconveniences or dangers. We do not hesitate to penalise or terminate contractors who do not exercise safety at the work site or fall short of our requirements in these areas: Use of inappropriate tools/equipment at site. Causing road safety issues. Late delivery. Lack of safety measures on site. Poor work quality. Lack of personnel protective equipment on site. PUNCAK NIAGA HOLDINGS BERHAD 109

116 AT THE MARKETPLACE ANNUAL REPORT SYABAS Safety Handbook for Contractors at the work site 02 Our trusted and reliable Auxiliary Police personnel For first offence, we suspend our contractors to ensure that they understand our stringent requirements. In 2009, we suspended 108 contractors at our District Offices, as follows: Chart: Statistic on Number of Contractors Suspended by Districts for Year No. of Contractors Kuala Lumpur Klang Gombak Petaling Hulu Langat Hulu Selangor Kuala Langat Kuala Selangor Sepang Sabak Bernam District Offices To show that we truly place great emphasis on high quality, we terminated the services of two contractors in 2009 who did not meet our stringent requirements due to the following reasons: Delay in mobilisation after issuance of work order. Deliberately creating delays in job completion. Inability to fulfil work quality requirements. Poor housekeeping after job completion. Use of unapproved materials. Involvement in water theft (illegal water connections). PUNCAK NIAGA HOLDINGS BERHAD 110

117 ANNUAL REPORT Majlis Berbuka Puasa Kakitangan PNSB, SYABAS meraikan Anak-anak Yatim & Warga Tua bersama YB Dato Sri Peter Chin Fah Kui at SSP2 WTP 04 SYABAS contingent at the Merdeka celebration held at Merdeka Square, Kuala Lumpur Development and Training of Contractors In line with SYABAS Concession Agreement (SYABAS CA) and the Government s policy to assist and develop Bumiputra contractors: 1. SYABAS continued the Program Penyertaan Usahawan Bumiputra (PPUB) programme to provide training and development programme whereby selected Class F contractors are trained by SYABAS Engineers to carry out various operation & maintenance works, mechanical/electrical work, pipe repair, meter replacement and etc. The performance of the contractors are assessed and graded regularly. 2. To provide opportunity for Bumiputra companies to participate in various SYABAS projects by registering Class F contractors with the respective Districts and given priority over other contractors to undertake the work within the Districts. THE WATER AND SANITATION CRISIS CLAIMS MORE LIVES THROUGH DISEASE THAN ANY WAR CLAIMS THROUGH GUNS To date, 136 contractors had been engaged or benefited from various SYABAS projects worth RM391,362, at all the ten Districts. More structured training and development programmes will be organised by SYABAS in collaboration with the Construction Industry Development Board under the Memorandum of Understanding dated 26 February 2009 to enhance the competencies and skills of contractors under the PPUB programme in PUNCAK NIAGA HOLDINGS BERHAD 111

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119 ENGAGEMENT WITH OUR COMMUNITY We continue to take our corporate social responsibilities seriously and, wherever practicable, strive to enhance the quality of life of people in the communities that we serve. WE OPENED 11WATER TREATMENT PLANTS & 10 DISTRICT OFFICES FOR THE PUBLIC IN CONJUNCTION WITH THE WORLD WATER DAY 2009 CELEBRATION

120 OUR CORPORATE SOCIAL RESPONSIBILITY ANNUAL REPORT Our River Rescue Brigade programme 02 Our BPS members participating in the World Water Day 2009 celebration CORPORATE COMMUNITY INVESTMENT In 2009, we contributed approximately RM3.40 million towards various charitable causes. Besides charitable organisations, we also contributed significantly in 2009 through various programmes that we conducted for the communities, namely: Turun ke Padang (TKP) Programme (Amount spent: RM27,020.05) River Rescue Brigade (BPS) (Amount spent: RM25,661.73) Other Community Events/Activities as set out in pages 117 to 119 of this Annual Report (Amount spent: RM3,269,418.09) TURUN KE PADANG (TKP) PROGRAMME The TKP programme which is an extension of our River Rescue Brigade aims to educate primary school children in year four and five on water and environmental education, particularly in water resources and conservation. Interesting modules which include briefing, quizzes, water-box demonstration, Questions & Answers sessions and colouring contests were introduced to the school children during the TKP programme. In 2009, the Group successfully conducted a total of 11 TKP programmes at the following schools, for which we spent RM27,020.05: School Name District SJK (C) Chap Khuan Gombak SK Puchong Jaya Petaling SJK (T) Ladang Batu Ampat Klang SK Jugra Kuala Langat SJK (C) Khai Tee Kuala Selangor SJK (T) Bangi Hulu Langat SK Selayang Utama Gombak SK Ampang Pecah Hulu Selangor SJK (C) Kah Wah Kuala Langat SJK (T) Ladang Rinching Hulu Langat SJK (C) Chong Hwa Kuala Lumpur Note: SJK (T) denotes Sekolah Jenis Kebangsaan Tamil SJK (C) denotes Sekolah Jenis Kebangsaan Cina SK denotes Sekolah Kebangsaan PUNCAK NIAGA HOLDINGS BERHAD 114

121 ANNUAL REPORT Students of Japanese School of Kuala Lumpur being educated on the conservation of water at Wangsa Maju WTP 04 SYABAS Chief Executive Officer engaging with the local community RIVER RESCUE BRIGADE [BRIGED PENYELAMAT SUNGAI (BPS)] In 2009, we conducted 10 out of the 12 targeted Sehari Bersama BPS programme at a cost of RM25, This monthly programme is organised by BPS with the objective of reaching out to the primary school children and educating them on the water treatment processes as well as conservation of the environment especially our rivers. THE HUMAN BRAIN IS 75% WATER Educational Trip to Intake, Dams and Water Treatment Plants ( WTP ) (Sehari Bersama BPS) for the students from the following schools: 1. SJK (T) Ladang Sg Choh, Rawang on 14 February 2009 to Batang Kali WTP. 2. SK Permatang Pasir, Bukit Mertajam on 28 February 2009 to Bukit Tampoi WTP. 3. SJK (T) Ladang Effingham, Petaling Jaya on 28 March 2009 to Tasik Subang Dam and North Hummock WTP. 4. SJK (C) Khing Ming, Kuala Kubu Bharu on 11 April 2009 to Kuala Kubu Bharu WTP. 5. SJK (C) Chap Kuan, Gombak on 25 April 2009 to Batang Berjuntai Intake and Sg Selangor Phase 2 WTP. 6. SJK (T) Ladang Batu Ampat, Klang on 23 May 2009 to Tasik Subang Dam and North Hummock WTP. 7. SK Puchong Jaya, Petaling on 27 June 2009 to Sg Langat Dam and WTP. 8. SK Jugra, Kuala Langat on 11 July 2009 to Bukit Tampoi WTP. 9. SJK (T) Bangi, Hulu Langat on 8 August 2009 to Langat Dam and WTP. 10. SK Ampang Pecah, Hulu Selangor on 14 November 2009 to Kuala Kubu Bharu WTP. On 29 March 2009, our Group celebrated the World Water Day 2009 at PNSB s Head Office at Wisma Rozali, Shah Alam. In conjunction with the World Water Day 2009 celebration, we opened up 11 WTPs in Selangor and Kuala Lumpur for the public whereby informative briefing on water treatment processes were conducted by our employees to educate the public on our treatment processes and our business generally. To encourage more people to attend our WTP Open Day, we had arranged transportation for members of the public to visit our WTPs. PUNCAK NIAGA HOLDINGS BERHAD 115

122 OUR CORPORATE SOCIAL RESPONSIBILITY ANNUAL REPORT Programme with SMK Teloi Kanan Kedah, The Gold Medal winners in Joensuu Way 2009 Conference, Finland 02 Reduce, Reuse, Recycle and Earn (3R1E) Campaign held at the Shah Alam Community Hall Additionally, we held a BPS Programme on 29 March 2009 at Wisma Rozali, graced by YBhg Dato Muhamad Azaham Abdul Wahab, the Deputy President of the Water Association of Selangor, Kuala Lumpur and Putrajaya. The BPS Programme was successfully conducted with the participation of 350 students from 22 schools in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya, as follows: Name of School District 1. SK Puncak Alam Kuala Selangor 2. SJK (T) Vageesar Kuala Selangor 3. SK Kuala Kubu Bharu Kuala Kubu Bharu 4. SJK (T) Ladang Sg Choh Rawang 5. SJK (C) Peng Ming Telok Panglima Garang 6. SJK (T) Telok Panglima Garang Telok Panglima Garang 7. SK Sungai Manggis Banting 8. SK Dengkil Dengkil 9. SK Dato Abu Bakar Baginda Kajang 10. SK Sungai Lui Hulu Langat 11. SK Sg Serai Hulu Langat 12. SJK (C) Yoke Kuan Sekinchan 13. SK Seri Mawar Sabak Bernam 14. SJK (T) Batu Arang Batu Arang 15. SJK (C) Kundang Rawang 16. SK (1) Jln Meru Klang 17. SK Meru Klang 18. SK Seksyen 13 Shah Alam 19. SM Sultan Salahuddin Abdul Aziz Shah Shah Alam 20. SK Seksyen 18 Shah Alam 21. SJK (T) Ladang Effingham Petaling Jaya 22. SK Damansara Jaya 2 Petaling Jaya Note: SJK denotes Sekolah Jenis Kebangsaan SJK (T) denotes Sekolah Jenis Kebangsaan Tamil SJK (C) denotes Sekolah Jenis Kebangsaaan Cina SK denotes Sekolah Kebangsaan PUNCAK NIAGA HOLDINGS BERHAD 116

123 ANNUAL REPORT Minister of Defence, YB Dato Seri Dr Ahmad Zahid Hamidi at the Closing Ceremony of Program Latihan Kem Tahunan Skuadron Selangor 60 Rejimen Pengendalian Air RAJD (AW) Siri 01/ SYABAS Chief Executive Officer delivering his paper at CSR & Sustainability as Basis for Pioneering Business Model On 28 December 2009, BPS had organised visitation to Alor Setar, Kedah with the participation of 22 students and members of BPS. Various activities were held including visiting the Menara Alor Setar, Istana Kota Setar and watching the Puncak Piala Emas Raja-Raja Final Soccer Cup Match between Perlis and Kedah. OTHER COMMUNITY EVENTS/ACTIVITIES Below is a listing of several other community events/activites which we participated and/or supported in 2009: SOURCES OF WATER POLLUTION INCLUDE OIL SPILLS Education a. Majlis Pelancaran Sekolah Lestari dan Laman Web SK Seri Utama, Sg Besar held on 18 April 2009; b. Program Kitar Semula Reduce, Reuse, Recycle and Earn!! (3R1E) anjuran Pusat Khidmat Aduan Alam Sekitar (organised by the Federation Of Malaysian Consumer A) held on 24 May 2009; c. Green Hunt 2009 organised by the Malaysian Environmental NGOs (MENGO) which was held on 27 June 2009 in conjunction with World Environment Day celebrations. The Green Hunt 2009 was held to promote a low ecological footprint and live a more sustainable lifestyle while enjoying the richness and resources that Mother Earth provides; d. Minggu Populasi Sedunia SMK Bukit Jelutong, Shah Alam organised by PNSB on 15 July 2009; e. Minggu Pengguna Malaysia 2009 anjuran Gabungan Persatuan-persatuan Pengguna-pengguna Malaysia (FOMCA) on 1 August 2009; f. On 3 to 5 March 2009, SYABAS organised a Career Carnival in conjunction with Career Path 2009 at Universiti Malaya. We received approximately 600 visitors at our counter, mostly from students who were exploring career opportunities with SYABAS. g. Program Kesedaran Pengguna aimed at cultivating consumers awareness on the importance of water were organised by SYABAS at the Police Headquarters in Kuala Selangor, Hospital Banting, Kuala Langat and Institute Kemahiran Belia Negara, Sepang on 29 October 2009, 19 November 2009 and 3 December 2009 respectively. h. Educational Trip by Japanese School Kuala Lumpur on 4 June 2009 to Wangsa Maju WTP and Klang Gates Dam. PUNCAK NIAGA HOLDINGS BERHAD 117

124 OUR CORPORATE SOCIAL RESPONSIBILITY ANNUAL REPORT Our River Rescue Brigade seeks to educate the younger generation on the importance of environmental preservation and conservation 02 Our 24th River Rescue Brigade Programme with YABhg Datin Paduka Seri Rosmah Mansor Education Sponsorship On 17 June 2009, we held the Program Bersama Pemenang Pingat Emas Di Persidangan Antarabangsa Alam Sekitar Joensuu Way 2009 at Wisma Rozali. PNSB sponsored RM16, for the Gold Medal winners of the 2009 Joensuu Way International Environmental Convention, namely a team of students from SMK Teloi Kanan, Kuala Ketil, Kedah to participate in the event which was held in Helsinki, Norway and they were invited to present their winning materials to the Management of PNSB and 50 invited students from three schools in Shah Alam, namely, Sekolah Menengah Kebangsaan Bukit Jelutong, Sekolah Menengah Agama Tengku Ampuan Jemaah Seksyen 11 and Sekolah Kebangsaan Seksyen 13. PNSB also sponsored RM5, for the special Cosmo dome in conjunction with The Pameran Pendidikan Sains Aerospace & ICT 2009 which was held from 29 to 31 May 2009 at Brinchang, Cameron Highlands. Appreciation To Our Consumers Majlis Penyampaian Hadiah Pelanggan Prihatin SYABAS, a celebration to acknowledge the lucky draw winners from those consumers who assisted SYABAS in lodging useful complaints in 2009 via the toll-free number which helped shorten investigation period and enable SYABAS to act swiftly to solve the complaints/problems and increase SYABAS service level. The event was held four times in 2009 at the Auditorium at SYABAS Head Office in Jalan Pantai Baharu, Kuala Lumpur on 14 February 2009, 30 May 2009, 25 July 2009 and 24 October CSR and Sustainability Talk SYABAS Chief Executive Officer, YBhg Dato Ruslan Hassan gave a talk entitled CSR & Sustainability as Basis for Pioneering Business Model which was held at Hotel Maya, Kuala Lumpur on 17 September 2009 in conjunction with the CSR & Sustainability Summit 2009 which was graced by the guest of honour, YB Datuk Mukhriz Tun Dr Mahathir, the Deputy Minister of International Trade & Industry, Malaysia. The invitation by the organiser, Asian Strategy & Leadership Institute (ASLI) is a testament of the public s acceptance of SYABAS conduct of its business in a responsible and socially sustainable manner. Social Responsibilities a. Installation of individual meters for residents of Taman Widuri and Taman Kesumba, Bukit Beruntung on 17 September 2009 witnessed by SYABAS Chief Executive Officer, YBhg Dato Ruslan Hassan. These residents have been facing water supply problems for the past eight years due to the developer s failure to provide a permanent water supply system to the areas. PUNCAK NIAGA HOLDINGS BERHAD 118

125 ANNUAL REPORT Majlis Mesra Deepavali 2009 held at SYABAS Kuala Lumpur District Office 04 SYABAS supplied clean water to the residents during the Pulau Ketam water crisis b. On 30 September 2009, a powerful 7.6 magnitude earthquake struck 30 miles from Indonesia s Padang off the coast of southern Sumatra (Source: The Star, 30 September Quake in Sumatra, tremors in Malaysia). Our Group had reached out by supplying clean, potable water to the earthquake victims at Padang, Indonesia on 6 October ALMOST ALL TYPES OF FOOD CONTAIN WATER c. PNSB s employees and SYABAS employees donated a total amount of RM6, and RM12,101.00, respectively to the war victims of Gaza via MERCY Malaysia. The donation presentations were held by PNSB at Wisma Rozali, Shah Alam on 17 February 2009 and by SYABAS at NSTP Building, Kuala Lumpur, respectively. d. PNSB and SYABAS assisted Suruhanjaya Perkhidmatan Air Negara (SPAN), Department of Environment (DOE), Lembaga Urus Air Selangor (LUAS) and Indah Water Konsortium Sdn Bhd to find the source of the raw water pollution at Cheras Mile 11 WTP due to high ammonia content which caused the interruption of treated water supply and to ensure that the water supply is continuously provided to the residents during the shutdown of the Cheras Mile 11 WTP. e. SYABAS hosted visits by various water agencies, universities and government agencies, both local and overseas at SYABAS Head Office, as detailed in the section Delivering Service Excellence in page 089 of this Annual Report. f. PNSB hosted visits by various water agencies and government agencies, both local and overseas at PNSB s Head Office, Dams and WTPs, as detailed in the section Delivering Service Excellence in page 089 of this Annual Report. g. On 22 March 2009, in conjunction with the World Water Day 2009 celebration, SYABAS organised a Programme Sehari Bersama SYABAS (A Day With SYABAS) simultaneously at all the 10 District Offices in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya. In 2010, we organised the following events, respectively: a. The Closing Ceremony of the Program Latihan Kem Tahunan Skuadron Selangor 60 Rejimen Pengendalian Air RAJD (AW) Siri 01/2010 held on 23 March 2010 at SSP2 WTP by the Defence Minister, YB Dato Seri Dr Ahmad Zahid Hamidi. b. 24th Briged Penyelamat Sungai (BPS) with our Guest of Honour, YABhg Datin Paduka Seri Rosmah Mansor on 27 April 2010 at Universiti Putra Malaysia. PUNCAK NIAGA HOLDINGS BERHAD 119

126 CORPORATE EVENTS ANNUAL REPORT JAN 09 The Official Launch of PUSPEL s new logo and service motto. 16 JAN 09 Visit by China Delegation from Water Department of Guangdong, China to SYABAS Headquarters and SSP2 WTP. 17 FEB 09 Presentation Ceremony for Gaza Humanitarian Mission at Wisma Rozali, Shah Alam. 26 FEB 09 SYABAS organised a Launching Ceremony of Plumbing Course and Memorandum of Understanding Signing Ceremony between SYABAS and Construction Industry Development Board Malaysia (CIDB). 17 FEB 14 MAR 26 FEB 10 JAN 09 MAR 09 PNSB participated in Perarakan Maulidur Rasul 1430 Hijrah at Dataran Merdeka. 14 MAR 09 Majlis Sambutan Maulidur Rasul at Sg Panjang, Sabak Bernam. 22 MAR 09 SYABAS World Water Day 2009 Celebration was simultaneously launched at the 10 District Offices. 29 MAR 09 SYABAS Counter in conjunction with World Water Day 2009 Celebration at Wisma Rozali, Shah Alam. 22 MAR 16 JAN PUNCAK NIAGA HOLDINGS BERHAD MAR

127 ANNUAL REPORT APR 23 JUN 07 APR 09 Visit by Luancheng County Government of China to SSP2 WTP, Wisma Rozali, SYABAS Headquarters and PUSPEL. 19 MAY 09 PNHB participated in Water Malaysia Conference Stream 1 at Putra World Trade Centre. 21 MAY 09 Visit by Sibu Water Board to SYABAS Headquartes and PUSPEL. 08 JUN 09 Visit by Kedah EXCO to SYABAS Headquarters and PUSPEL. 10 JUN 09 Visit by Syarikat Air Negeri Sembilan (SAINS) to SYABAS Headquarters and PUSPEL. 23 JUN 09 PNHB s 12th Annual General Meeting and Extraordinary General Meeting held at Concorde Hotel Shah Alam. 10 JULY 09 PNHB supported Yayasan Tuanku Nur Zahirah s Royal Songket Ball to promote the songket heritage. 21 JULY 09 Visit by the delegates from Taiz Water Supply and Sanitation Local Corporation Republic of Yemen to SYABAS Headquarters and PUSPEL. 21 JUL 10 JUN 10 JUL PUNCAK NIAGA HOLDINGS BERHAD 19 MAY 121

128 CORPORATE EVENTS ANNUAL REPORT AUG 09 YB Dato Sri Peter Chin Fah Kui, Minister of Energy, Green Technology and Water visited SYABAS Headquarters and Wangsa Maju WTP AUG 09 Hari Terbuka Pameran SYABAS dan PNSB held at SYABAS AUG 09 PNHB was a Diamond Sponsor for the National Tax Conference AUG 09 Official Visit by YB Dato Dr Hassan Mohd Ali, the Selangor EXCO for Islamic Affairs, Malay Customs, Infrastructure and Public Amenities and YB Dato Haji Takiyuddin Hassan, Kelantan EXCO to SYABAS Headquarters. 03 AUG 13 AUG 05 SEPT AUG 13 AUG 09 PNHB was the Winner for Integrated Reporting in an Annual Report for the ACCA Malaysia Sustainability Reporting Awards (MaSRA) AUG 09 SYABAS contingent participated in the National Day Celebration held at Dataran Merdeka, Kuala Lumpur. 05 SEPT 09 PNSB organised a Majlis Berbuka Puasa graced by Duli Yang Maha Mulia Sultan Sharafuddin Idris Shah Al-Haj Ibni Almarhum Sultan Salahuddin Abdul Aziz Shah Al-Haj held at Masjid Negeri, Shah Alam. 15 SEPT 09 The Minister of Energy, Green Technology and Water visited the SSP2 WTP and also graced the Majlis Berbuka Puasa Bersama Anak-anak Yatim. 31 AUG PUNCAK NIAGA HOLDINGS BERHAD SEPT

129 06 OCT ANNUAL REPORT NOV 09 PNHB Group s Executive Chairman was conferred the Rotary Vocational Excellence Service Award NOV 09 Visit by Confservizi Veneto, Italy to SYABAS Headquarters and PUSPEL. 06 OCT 06 OCT 09 PNHB Group supplied bottled drinking water to earthquake victims in Padang, Indonesia. 30 OCT 09 Visit by YB Dato Dr Hassan Mohd Ali, the Selangor EXCO for Islamic Affairs, Malay Customs, Infrastructure and Public Amenities to Salak Tinggi Intake and Cheras Mile 11 WTP NOV 09 PNSB participated in Water Industry Management & Auditing Symposium 2009 held at Shah Alam Convention Centre. 03 NOV 09 Launching of the Latihan Kem Tahunan Siri 6/2009 Zon Tengah (Selangor/Negeri Sembilan) Rejimen Pakar Pengendalian Air ke 60 RAJD (AW) held at SSP2 WTP. Visit by Senior Officials from the Government of Sri Lanka to SYABAS Headquarters and PUSPEL. 01 DEC 09 PNHB obtained the Certificate of Merit at the National Annual Corporate Report Awards (NACRA) 2009 held at Sime Darby Convention Centre. 04 DEC 09 Majlis Pelancaran Rasmi Logo Kejohanan Bolasepak Puncak Piala Emas Raja-Raja held at Wisma Rozali, Shah Alam. 3 NOV NOV 06 NOV 30 OCT 01 DEC PUNCAK NIAGA HOLDINGS BERHAD 123

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131 PRESERVING OUR ENVIRONMENT Sustainable operations are key to the long term viability of our business. We remain committed to conserving and enhancing our environment, striving to achieve full compliance with our legislative obligations and to lead the industry in environmental management. OUR 26 WTPs CONSUMED 86, METRIC TONNES OF CHEMICALS IN OUR WATER TREATMENT PROCESS

132 SUSTAINING OUR ENVIRONMENT ANNUAL REPORT & 02 Water quality monitoring by personnel of PNSB and SYABAS At Puncak Niaga, we take our corporate environmental responsibility seriously particularly in the protection and conservation of the natural resources. The Environmental Surveillance Section (ESS) of our Water Resources and Environmental Surveillance (now known as Water Quality & Research Section) is responsible for carrying out various environmental programmes, which include regular sanitary surveys, special environmental investigations within the water catchment areas, investigations of violations and reporting of raw water pollution to the relevant Authorities such as the Department of Environment (DOE) and Lembaga Urus Air Selangor (LUAS). Puncak Niaga (M) Sdn Bhd (PNSB) operates and maintains a River Warning Monitoring Station (RWMS) at Sg Selangor upstream of the Sg Selangor Phase 2 (SSP2) WTP for purposes of providing early warning of possible raw water quality violations. We also operate five Raw Water Surveillance Stations (RWSS) at intake points for the Salak Tinggi, Bukit Tampoi, Sg Langat, Cheras Mile 11 and Gombak WTPs. These intake points were selected as the raw water sources were susceptible to pollution that can exacerbate raw water quality violations during low flow in the dry seasons leading to shutdown of WTPs. Our toll-free river-watch telephone hotline ( ) enables the public to inform us of any signs of pollution. WATER QUALITY INDEX PROGRAMME We monitor water quality in the rivers through our Water Quality Index (WQI) Programme which is conducted on a monthly basis for all WTPs by computing the WQI value to determine the cleanliness and suitability of the water for water supply, aquaculture and irrigation purposes, as illustrated below: WQI Classification According to DOE Malaysia WQI Class Range Water Usage Description I 92.7 Water Supply I Practically no treatment necessary and above (except disinfection or boiling only). Fishery I Very sensitive aquatic species. II 76.5 < 92.7 Water Supply II Conventional treatment required. Fishery II Sensitive aquatic species. III 51.9 < 76.5 Water Supply III Extensive treatment required. Fishery III Common, of economic value and tolerant species. IV 31.0 < 51.9 Irrigation only. V < 31.0 Water unsuitable for any of the above uses. (Source: Department of Environment Malaysia) PUNCAK NIAGA HOLDINGS BERHAD 126

133 ANNUAL REPORT World Water Day 2009 celebration by PNHB Group at Wisma Rozali 04 Students participating in our River Rescue Brigade Programme As of December 2009, the average monthly WQI readings for the intake/stations at 28 WTPs (excluding Sg Kroh WTP) indicated that only nine intake stations are categorised under Class I whilst 13 stations are under Class II and the remaining six in Class III: Record of WQI of the Intakes for 2009 WQI Class No. of Intake Stations * Location of Intake Stations I 9 Kuala Kubu Bharu, Kalumpang, Sg Pangsoon, Sg Lolo (Old), Sg Lolo (New), Sg Serai, Ampang Intake, Sg Rangkap, Sg Kepong WTPs. II 13 Bernam River Headworks, North Hummock, Batang Kali, Sg Selisek, Sg Dusun, Sg Tengi, Sg Buaya, Sg Langat, Bukit Nanas, Sg Batu, Sg Gombak, Sg Rumput, Wangsa Maju WTPs. III 6 Rantau Panjang, SSP2, Sg Sireh, Bukit Tampoi, Cheras Mile 11, Salak Tinggi WTPs. IV 0 None. V 0 None. * Note: Excluding Sg Kroh WTP WATER IS THE PRIMARY MODE OF TRANSPORTATION FOR ALL NUTRIENTS IN OUR BODY AND IS ESSENTIAL FOR PROPER CIRCULATION Number of WTPs Involved in WQI Programme ( ) WQI Class No. of WTPs I 11 9 II III 6 6 IV 0 0 V 0 0 Total 29 28* * Note: Excluding Sg Kroh WTP Generally, raw water quality had been observed to have deteriorated as the number of intake stations with WQI of Class I had reduced and the number of intake stations with WQI of Class II had increased. The number of intake stations with WQI of Class III remained the same for 2008 and Based on the records, the WQI record at the intake stations of Batang Kali and Sg Rumput WTPs had deteriorated to Class II whilst the WQI record at the intake stations of SSP2 WTP had deteriorated to Class III. PUNCAK NIAGA HOLDINGS BERHAD 127

134 SUSTAINING OUR ENVIRONMENT ANNUAL REPORT Program Turun Ke Padang 99, SK Puchong Jaya 02 Site personnel on a routine check at SSP2 WTP s aerator RAW WATER QUALITY VIOLATIONS In 2009, there were a total of 1,485 raw water quality violations recorded (2008 : 1,268) and 21 cases of plant shutdowns recorded due to raw water pollution (2008 : 247) with a total of 5, hours of shutdown (2008 : 5, hrs). The following chart illustrates the annual raw water quality trends: Trend of Annual Raw Water Quality Violations and Plant Shutdowns Frequency of Violation/Shutdown 1,600 Production Loss (Hours) ,485 1,400 5,720 5, ,268 1,200 4, , , , ,391 2,324 3, , YEAR Total Raw Water Quality Violations Plant Shutdowns Due to Raw Water Violation Production Loss (No. of Hours) PUNCAK NIAGA HOLDINGS BERHAD 128

135 ANNUAL REPORT Water quality sampling and testing being conducted 04 SYABAS Chief Operating Officer at Water Malaysia 2009 The breakdown of the violated parameters in 2009 is shown below: Comparison of Total Raw Water Quality Violations Recorded in 2008 and 2009 Parameter Group Total Raw Water Quality Violations Recorded Microbiological Group I Physical Group II Inorganic matter Group III Heavy metals 1 13 Group IV Pesticides 0 0 Total 1,268 1,485 ABUNDANT FRESH WATER IS STORED IN AQUIFERS UNDERGROUND THAN ON THE EARTH S SURFACE Similar to 2008, most violations recorded for 2009 occurred in the Sg Langat, Sg Selangor and Sg Bernam basins: Distribution of Raw Water Quality Violations Recorded Per Catchment Area Catchment Area Total WTP(s)* Total Violations Sg Langat Sg Selangor Sg Bernam Sg Kelang Sg Buluh Sg Tengi Total 28 1,268 1,485 * Note: Excluding Sg Kroh WTP PUNCAK NIAGA HOLDINGS BERHAD 129

136 SUSTAINING OUR ENVIRONMENT ANNUAL REPORT Program Turun Ke Padang SJK(C) Chop Khuan Batu Arang 02 Salak Tinggi Plant shutdown due to blackish water and high ammonia level Raw water contamination can lead to plant shutdown cases, especially during periods of dry weather when the river level is reduced significantly and yet the pollution remain unchanged due to continuous discharges from industries or activities upstream of the intake. In 2009, although only 21 cases of plant shutdowns were recorded, there was a loss of production of 5, hours with a revenue loss of RM756, (2008:247 cases, 5, hours of production loss with RM261, loss in revenue) due to the longer periods of plant shutdown time, including the following incidences: 1. The Gombak WTP experienced a total shutdown of hours in January 2009 due to an accident involving an overturned lorry tanker and a laundry van at KM 28, KL-Karak Highway which resulted in spillage of crude palm oil into the Gombak River. The Emergency Response Plan (ERP) Code Yellow was triggered with the involvement of the Selangor State Government, SYABAS and the highway concessionaire. 2. The Salak Tinggi WTP was closed five times due to raw water pollution resulting in a total of 2, hours of shutdown. 3. The Sg Buaya WTP was shut down twice, once in June 2009 and once in August 2009 due to sudden increase of raw water turbidity at the intake establised via joint investigation with the Authorities, namely Lembaga Urus Air Selangor (LUAS) and Suruhanjaya Perkhidmatan Air Negara (SPAN). It was deduced that both incidences were most likely be due to runoff from an area being developed for plantation. 4. The Cheras Mile 11 WTP was closed for hours due to high ammonia in the raw water. The incidences of pollution in our river systems is a cause for major concern, as it is the lifetime of our water supplies. We work closely with the Authorities such as DOE, LUAS and other relevant Authorities at the State and Federal levels to mitigate pollution incidences and to encourage environmental care. PUNCAK NIAGA HOLDINGS BERHAD 130

137 ANNUAL REPORT Accident involving an overturned lorry tanker resulted in spillage of crude palm oil into Sg Gombak 04 Students of Japanese School of Kuala Lumpur visiting Klang Gates Dam As part of our corporate environmental responsibility and in our efforts to conserve and preserve the natural resources, we are members of various environmental committees in the Selangor State, namely: 1. Jawatankuasa Tetap Alam Sekitar Negeri Selangor; 2. Jawatankuasa Tetap Infrastruktur dan Kemudahan Awam Negeri Selangor; 3. Jawatankuasa Pengurusan Lembangan Sungai Negeri Selangor; 4. Pasukan Petugas Lembangan Sungai Selangor; 5. Pasukan Petugas Lembangan Sungai Langat; and 6. Pasukan Petugas Lembangan Sungai Kelang. A WASHING MACHINE USES 30 GALLONS OF WATER PER LOAD We have also initiated several programmes which have been running since our inception, namely: 1. Sanitary Survey Programmes for early detection of environmental pollution, carried out at Kalumpang, Batang Kali, Sg Dusun, Salak Tinggi WTPs, Tasik Subang Dam and Klang Gates Dam. 2. Environmental pollution risk mapping of the six catchment areas for 28 WTPs (excluding Sg Kroh WTP) and Dams. 3. Sewage Treatment Plant Monitoring Programme surveillance of the STPs operated by Indah Water Konsortium and others located within the catchment areas. PUBLIC AWARENESS PROGRAMME ON ENVIRONMENTAL PROTECTION AND CONSERVATION In 2009, we continued with our environmental awareness campaign and activities with the aim of highlighting the impact of pollution and the need to preserve our water resources and participated in the following: Exhibition, judging panel and delivered talk on Water & Environment, WTP Open Day and articles on raw water management in conjunction with the World Water Day 2009 celebration on 29 March Gave a presentation on Environmental Protection and Water Treatment Process during the Aerospace, Science and ICT Education Week at Cameron Highlands on 28 May 2009 to 1 June Gave a presentation at Malaysian Nature Society Talk: Water Resources- Issues and Challenges in August PUNCAK NIAGA HOLDINGS BERHAD 131

138 SUSTAINING OUR ENVIRONMENT ANNUAL REPORT WTP residual treatment facility 02 Water quality demonstration at Kuala Selangor Police Headquarters by SYABAS personnel WTP WASTE MANAGEMENT Waste generated by our activities are generally sludge (from our water treatment facilities), paper waste and construction waste (from our pipe maintenance programme). Our biggest waste issue arises from the generation of sludge from our WTPs. WTP Residue Treatment SSP2 and Wangsa Maju WTPs were equipped with WTP residue treatment facilities (STF). However, the 26 WTPs taken over under the Privatisation Cum Concession Agreement dated 22 September 1994 (PCCA) were not equipped with STF. In this connection, to comply with DOE s requirement, STFs construction have been included under SYABAS CAPEX Programmes as provided under the privatisation plan and in 2009, the construction of 16 STFs were completed. However, we are unable to fully operate the STFs as there are no suitable landfills located near our WTPs to accommodate the amount of residue produced. As part of the planning, we had identified 13 proposed sites for the Government s approval as suitable sites near our WTPs for development as landfills and have been diligently pursuing the Government s decision on this matter. However, the State Government had informed that the decision is pending the finalisation of the proposed restructuring of the water services industry in Selangor. We have also submitted an application for special management of scheduled waste for the Bukit Badung Depository Area which will be developed for the residues from SSP2 WTP and Wangsa Maju WTP and the matter is pending the authorities decisions. Reducing Paper Usage At PNSB, we managed to reduce our paper usage by 8% as compared to However, our paper usage at SYABAS increased by 1.5% as compared to 2008 due to numerous consumer awareness programmes organised by SYABAS as well as growth in consumer accounts. The Group will intensify efforts in its paper usage reduction programme for 2010 by promoting paper re-cycling, dissemination of documents via , etc. Reducing Construction Waste SYABAS now requires all its contractors to clean up waste generated from all maintenance activities. These contractors are monitored frequently as presented in the section Managing Our Suppliers/Contractors under Valuing Our People in page 109 of this Annual Report. PUNCAK NIAGA HOLDINGS BERHAD 132

139 ANNUAL REPORT PNHB Group participated in the International Green Technology & ECO at KLCC 04 Reservoir rim surveillance in progress USE OF RESOURCES Water Utilisation We use water for our maintenance works such as water treatment plant filters backwashing, reservoir and storage tank cleaning, cleaning of pipeline and flushing. We will be exploring alternatives to reduce water usage further although we reduced plant water loss through adoption of wash water recovery and prolonged filter backwash cycle up to 72 hours. SYABAS has used air scouring method instead of conventional scouring to clean the pipelines which has reduced water wastage by 40% MILLION PEOPLE DIE EACH YEAR FROM WATER RELATED DISEASES Reducing water losses is contributing to more effective water resources utilisation. Since its commencement of operation in 2005, SYABAS has reduced water losses from a level of 42.78% to about 32% by end 2009, a reduction of about 10% which has brought a saving at about 300 MLD in physical losses. On water consumption for office use, we are happy to report that the Group achieved a reduction of water consumption for office use by 21% in 2009 as compared to In terms of breakdown, we achieved a 3% reduction of water consumption at PNSB and a 25% reduction of water consumption in SYABAS. The chart below shows the breakdown: Our 2008 & 2009 Water Consumption (m 3 ) Total Total 90,000 76,702 m3 60,524 m3 80,000 Water Consumption (m 3 ) 70,000 60,000 50,000 40,000 30,000 20,000 10,000 62,042 14,660 46,300 14,224 PNSB 0 SYABAS Year The Group supports the concept of demand management, and provide technical advice to the authorities on rain water harvesting, and also presented various technical papers on water conservation. PUNCAK NIAGA HOLDINGS BERHAD 133

140 SUSTAINING OUR ENVIRONMENT ANNUAL REPORT & 02 PNHB Group participated in the Simposium Pengurusan & Pengauditan Industri Air 2009 at SACC Convention Centre, Shah Alam ELECTRICITY CONSUMPTION The water industry is an electricity intensive business. In PNSB, our highest electricity consumption at the WTPs is in the pumping system, and in SYABAS, electricity is used to drive its 451 pumping stations. Below is the description of the Group s electricity consumption: For Wisma Rozali (Headquarters), we managed to reduce our electricity consumption by 1% from 2008 to For the WTPs, our electricity consumption increased by 2% from 2008 to 2009 in view of increased volume of water produced by 0.9% during the corresponding period with different tariff electricity rates between the large WTPs and the smaller ones and periodic warm up of the installed STFs which are not fully operational so as to prevent deterioration of equipment. At SYABAS, various measures are taken to reduce electricity consumption at all office buildings and booster pumping stations. We implemented our electricity optimisation programme for the WTPs on continuous basis. However, not much reduction in electricity consumption is achieved since our WTPs are already operating at optimal efficiency as far as electricity consumption is concerned. CARBON EMISSION This year is the first time that we are reporting on our carbon emissions in respect of our activities. While we adhere to the principles as promulgated in the ISO14064 guidelines for greenhouse gas emissions quantification and the World Resources Institute Greenhouse Gas (GHG) protocol, we are only able to report our carbon emissions arising from our electricity consumption for this report. Based on our electricity consumption, the breakdown of our carbon emissions for 2009 is: Wisma Rozali - 1,501 tonnes of CO2eq. WTPs 178,802 tonnes of CO2eq. SYABAS 83,395 tonnes of CO2eq. USE OF RAW MATERIALS In 2009, we consumed a total of 86, metric tonnes of chemicals in our water treatment process. We are conducting research to find ways to optimise our operational efficiencies and chemicals usage or its alternative is an area which we are focusing on. PUNCAK NIAGA HOLDINGS BERHAD 134

141 136 Corporate Disclosure Policy 137 Statement on Corporate Governance 151 Statement on Internal Control 153 Audit Committee Report 160 Risk Management Policy & Report 164 Investor Relations Policy & Report 167 Quality Policy & Report 168 Health, Safety and Environmental Policy 169 SYABAS Corporate Responsibility Policy

142 CORPORATE DISCLOSURE POLICY As a responsible corporate citizen, Puncak Niaga is totally committed to upholding the highest standards of transparency, accountability and integrity in the disclosure of all material information on the Company to the investing public in an accurate, clear, complete and timely manner in accordance with the corporate disclosure requirements as set out in the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (Bursa Securities). The primary objectives of Puncak Niaga s Corporate Disclosure Policy are: 1. To promote and maintain market integrity and investor confidence. 2. to provide equal access to the Company s material information in an accurate, clear, timely and complete manner and to avoid selective disclosure to the investing public. 3. to exercise due diligence such that information disseminated to the investing public will be as far as possible accurate, clear, timely and complete. 4. to put in place an efficient management of information procedure that promotes accountability for the dissemination of material information to the investing public. 5. to build good investor relations with the investing public based on the principles of trust, honesty, openness, transparency and sound understanding of the Company. To achieve its objectives, the Company will endeavour to undertake the following: 1. ESTABLISH POLICIES AND PROCEDURES ensure written policies and procedures of the Company ( Puncak Niaga s Corporate Disclosure Policy and Procedure ) that encompass the Corporate Disclosure Policy and other requirements relating to corporate disclosure as set out in the Main Market Listing Requirements of Bursa Securities. appoint a senior officer of the Company to oversee and coordinate disclosures to ensure the Company complies with the Main Market Listing Requirements of Bursa Securities. Ensure that only designated persons are the Company s spokespersons. Ensure due compliance with Puncak Niaga s Corporate Disclosure Policy And Procedure. 2. EXERCISE DUE DILIGENCE AND PREPARATION Ensure that the persons responsible for disseminating material information to the investing public, exercise due diligence in ensuring that information to be released is accurate, clear, timely and complete. ensure that due care is observed when briefing and responding to analysts, institutional investors, the media and the investing public. 3. USE OF INFORMATION TECHNOLOGY Take advantage of current information technology to disseminate information to the investing public. Our commitment to the above Policy is driven by the Board of Directors of the PNHB Group and implemented by the Management. 136

143 statement on corporate governance COMPLIANCE STATEMENT The Board of Puncak Niaga is pleased to state that Puncak Niaga is in compliance with the Best Practices in Corporate Governance as set out in Part 2 of the Malaysian Code on Corporate Governance (Revised 2007) (Code) and has subscribed and remain firmly committed to the principles of good corporate governance as set out in Part 1 of the Code to strive for highest standards of corporate governance within the Group. The Group believes that the principles of good corporate governance are integral to Puncak Niaga s growth and ability to promote the confidence of its stakeholders and enhancing long-term shareholders value through improving corporate performance and accountability of Puncak Niaga whilst taking into account the interest of all stakeholders. The Board is therefore committed to ensure that the Principles and Best Practices of Corporate Governance are applied throughout Puncak Niaga Group in the best interests of all stakeholders. Since 2003, the Board has adopted a Board Charter, which provides guidance on how business is to be conducted in line with international best practices and standards of good corporate governance. In 2004, the Board has also adopted a Corporate Disclosure Policy and Procedure, which was formulated in line with the Guide On Best Practices In Corporate Disclosure issued by the Task Force on Corporate Disclosure Best Practices established by Bursa Malaysia Securities Berhad (Bursa Securities). From time to time, the Group continues to monitor, refine and revamp its financial objectives, goals, policies and procedures, controls and risk management framework to meet the evolving corporate environment. The Board of Puncak Niaga is therefore pleased to report on how the Group has subscribed and applied the principles as set out in Part 1 of the Code and the Best Practices in Corporate Governance as set out in Part 2 of the Code and the extent to which it has complied with the Best Practices during the year BOARD OF DIRECTORS (a) THE BOARD the Group is helmed by an effective and experienced Board, comprising individuals of caliber and credibility with necessary skills and experience from a diverse blend of professional backgrounds. With the adoption of the Board Charter, the Board members, whether acting in their individual capacities or as a whole, share the common objective of ensuring that the Vision and Mission of the Company as set out in the inner front cover of this Annual Report, are achieved and the Group meets its responsibilities to its stakeholders. each Board member is fully aware of the fiduciary duties and responsibilities and the various legislations and regulations affecting his conduct as Director of the Company, and as such, takes full responsibility for the performance of the Company and of the Group. the role of the Executive Chairman is separate from that of the Managing Director. The Board Charter sets out the specific responsibilities to be discharged by the Board members collectively and the individual roles expected from the Executive Chairman, Managing Director, Executive Directors and Non-Executive Directors. ybhg Tan Sri Dato Seri Dr Ting Chew Peh is the Company s Senior Independent Non-Executive Director, to whom shareholders concerns may be conveyed. His profile is set out on page 037 of this Annual Report. 137

144 statement on corporate governance (b) BOARD COMPOSITION for compliances with Paragraph of the Main Market Listing Requirements of Bursa Securities and the Code, the Company, through the Nomination Committee of the Company, annually reviewed the required mix of skills, experience and competencies and other qualities of the Board of the Company. the composition of the Board of Puncak Niaga comprises ten (10) Members, of whom four (4) are Executive Directors and six (6) are Non-Executive Directors. This composition is in compliance with Paragraph of the Main Market Listing Requirements of Bursa Securities with one-third of the Board being independent and of which the Company feels is a balanced Board and appropriate to constitute an effective Board. ybhg Dato Matlasa Hitam and Mr Tan Seng Lee resigned from the Board as Managing Director and Executive Director, Finance Division of PNHB and PNSB on 31 December 2009, respectively. They were replaced by YBhg Dato Hashim Mahfar, the new Managing Director of PNHB and PNSB and Mr Ng Wah Tar, the new Executive Director, Finance Division of PNHB and PNSB on 1 January 2010, respectively. The new Board of Puncak Niaga effective 1 January 2010 complies with Paragraph of the Main Market Listing Requirements of Bursa Securities. the three (3) Independent Non-Executive Directors of the Company fulfil the criteria of independence as set out in the definition of Independent Director under Paragraph 1.01 (Definitions) of the Main Market Listing Requirements of Bursa Securities. the Independent Non-Executive Directors are persons of calibre and credibility and exercise independent judgement and act in the best interests of the Company and its shareholders since they do not engage in the day-to-day management of the Company and do not participate in any business dealings and are not involved in any other relationship with the Company to ensure that they discharge their duties and responsibilities effectively, void of conflict of interests situations. the composition of the Board brings to the Group a diverse wealth of skills, knowledge as well as a balanced mix of experience and expertise to effectively discharge the Board s responsibilities for competent stewardship of the Group. Together, the Board spearheads the Group s growth and future direction. The profile of the Board Members are set out on pages 030 to 040 of this Annual Report. none of the Directors has any convictions for any offences within the past ten (10) years (other than traffic offences, if any) or has any conflict of interest with the Company or has any family relationship with any Director and/or major shareholder of the Company. (c) BOARD MEETINGS the Board met six (6) times in 2009, all at the Board Room on 12th Floor, Wisma Rozali, No. 4, Persiaran Sukan, Seksyen 13, Shah Alam, Selangor Darul Ehsan, details of which are as follows: Day date time Thursday 19 February pm Thursday 26 February am Monday 27 April am Monday 25 May am Monday 24 August am Monday 23 November noon 138

145 The details of the respective Director s attendance at the above Board Meetings are as follows: Name of no. of Meetings Director designation attended % Tan Sri Rozali Ismail executive Chairman 5 out of Dato Matlasa Hitam (Resigned on 31/12/2009) managing Director 6 out Dato Ruslan Hassan non-independent Non-Executive Director 6 out of Dato Ir Lee Miang Koi non-independent Non-Executive Director 4 out of Dato Syed Danial Syed Ariffin Chief Operating Officer 6 out of Tan Sri Dato Hari Narayanan Govindasamy independent Non-Executive Director 4 out of Tan Sri Dato Seri Dr Ting Chew Peh independent Non-Executive Director 6 out of Tan Seng Lee (Resigned on 31/12/2009) executive Director, Finance 6 out of Tengku Dato Rahimah Almarhum Sultan Mahmud Non-Independent Non-Executive Director 5 out of Tan Sri Dato Ahmad Fuzi Haji Abdul Razak independent Non-Executive Director 6 out of Board meetings are scheduled to be held regularly, at least five times in a financial year with sufficient notice for all Board Meetings of issues to be discussed. The dates for Board Meetings for the ensuing financial year are scheduled well in advance and the Board has a formal schedule of matters specifically reserved for the Board s discussion and/or approval. All issues discussed and all decisions made during the Board Meetings will be properly recorded by the Company Secretaries. Additional Board Meetings may be called as and when significant issues arise and which require the Board s decision. in between Board Meetings, approvals on matters requiring the sanction of the Board are sought by way of circular resolutions enclosing all relevant information to enable the Board to make informed decisions. All circular resolutions approved by the Board will be tabled for notation and confirmation at the next Board Meeting. (d) DIRECTORS CODE OF ETHICS the Directors continue to observe a code of ethics based on the code of conduct expected of Directors of companies as set out in the Company Directors Code of Ethics established by the Companies Commission of Malaysia. 139

146 statement on corporate governance (e) SUPPLY OF INFORMATION AND ACCESS TO ADVICE the Directors are familiar and aware of their duties and responsibilities as well as the implementation of good corporate governance and compliance practices in the Group. each Board member is supplied with full, adequate, unrestricted and quality information on a timely basis to enable them to effectively discharge their duties and responsibilities. Except under exceptional circumstances, Board members are given at least seven days notice before any Board Meeting is held and the comprehensive Board papers are circulated to the Board members at least two (2) working days prior to the date of the Meeting to facilitate the Directors to peruse the Board papers and to review the issues to be deliberated at the Board Meeting well ahead of the meeting date. Where necessary, the Company s personnel will be called upon by the Board during the Board Meetings to present and to clarify any Board papers presented. all Board members are expected to participate actively in Board deliberations and to bring the benefit of their particular knowledge, skills and abilities to the Board. Where a potential conflict with his duties or of interests as Director arises, it is mandatory for the Director concerned to declare the fact and nature of his interests and extent of the conflict at a Board Meeting and abstain from the deliberation and decision-making process. In the event the proposal requires shareholders approval, the interested Board members will abstain from voting on the resolution at the General Meeting and will ensure that persons connected to them also abstain from voting on the proposal. the Company Secretaries organise and attend all Board Meetings and ensure that all issues discussed with the conclusions are minuted accurately in the minutes of each meeting and that all records are kept properly at the registered office of the Company. the Board is regularly updated and kept informed by the Company Secretaries and the Management of the requirements such as restriction in dealing with the securities of the Company and updates as issued by the various regulatory authorities including the latest developments in the legislations and regulatory framework affecting the Group. The Board has unrestricted and constant access to and interaction with the Senior Management of the Company. Each Board member also has full access to the advice and services of the full time Company Secretaries. Where necessary, the Directors may, whether collectively as a Board or in their individual capacities, seek external and independent professional advice from experts on any matter in furtherance of their duties as they may deem necessary and appropriate at the Company s expense. (f) COMPANY SECRETARIES the Company Secretaries ensure that Board procedures are both followed and reviewed regularly and have the responsibilities in law to ensure that each Board member is made aware of and provided with guidance as to their duties, responsibilities and powers. They are also responsible for ensuring the Group s compliance with the relevant statutory and regulatory requirements. 140

147 (g) APPOINTMENT OF DIRECTORS all Board appointments and removals (if any) thereof are approved by the Board upon the recommendation of the Nomination Committee. The Board, through the Nomination Committee, has established a formal and transparent procedure in relation to the assessment of candidates for Board appointments as well as for assessing the effectiveness of the Board as a whole, the Committees of the Board and the contributions of each individual Director, including the Independent Non-Executive Directors and the Managing Director. The Board, through the Nomination Committee, also reviews the required mix of skills, experience and other qualities of the Directors annually to ensure that the Board continues to function effectively and efficiently. During the financial year under review, there were no new appointments to the Board. There were however, two resignations during the financial year under review. (h) EVALUATION OF BOARD EFFECTIVENESS as in the previous years, the Board has, with the assistance of the Company Secretaries, conducted an annual peer evaluation of the Board s effectiveness in the following key areas: i Compliance; ii Board Meetings; iii Board Functions; iv Board Structure; v Board Committees; vi Board Operations; vii Board Chairman s Roles and Responsibilities; viii Financial and Operational Reporting; ix Planning and Objectives; x Risk Assessment; xi New Business Opportunities and Projects; xii Human Resources; and xiii Directors Observations and Additional Comments. the 2009 performance evaluation of the Board has been structured to ensure a balanced and objective review by the Directors for the above key areas. following the evaluation, the Board concluded that the Board as a whole and its committees had performed well, were effective and had all the necessary skills, experience and qualities to lead the Company. 141

148 statement on corporate governance (i) BOARD COMMITTEES the Board has delegated specific responsibilities to the Board Committees whose functions and authorities are spelt out in their respective terms of reference. The Board Committees will observe the same rules of conduct and procedures as the Board, unless otherwise determined by the Board. A summary of the various Board Committees at PNHB level and their composition are as follows: compliance, I internal Control Name of audit remuneration Nomination and Risk Policy Director committee Committee Committee Committee (CICR) Tan Sri Rozali Ismail Executive Chairman Dato Matlasa Hitam Past Managing Director (Resigned on 31/12/2009) Dato Ruslan Hassan Non-Independent Non-Executive Director Dato Ir Lee Miang Koi Non-Independent Non-Executive Director Dato Syed Danial Syed Ariffin Chief Operating Officer Tan Sri Dato Hari Narayanan Govindasamy Member Member Member Independent Non-Executive Director #Head Tan Sri Dato Seri Dr Ting Chew Peh Chairman Member Member Chairman Independent Non-Executive Director Tan Seng Lee Past Executive Director, Finance (Resigned on 31/12/2009) Tengku Dato Rahimah Almarhum Sultan Mahmud Non-Independent Non-Executive Director Member ##Member Tan Sri Dato Ahmad Fuzi Haji Abdul Razak Member Chairman Chairman Independent Non-Executive Director Dato Hashim Mahfar *Head Managing Director (Appointed on 01/01/2010) Ng Wah Tar **Member **Member Executive Director, Finance (Appointed on 01/01/2010) Note 1 # Ceased as a Member/Head of CICR on 31/12/ ## Ceased as a Member on 31/12/ *Appointed as a Member/Head of CICR on 01/01/ ** Appointed as a Member on 01/01/ the Audit Committee comprises non-executive directors, a majority of whom are independent directors (compliance with Paragraph of the Main Market Listing Requirements of Bursa Securities) 6 The Remuneration Committee comprises wholly or mainly of non-executive directors (as recommended in the Code) 7 The Nomination Committee comprises wholly of non-executive directors, a majority of whom are independent (as recommended in the Code) 142

149 the Board Committees exercise transparency and full disclosure in their proceedings. Where applicable, issues are reported to the Board with the appropriate recommendations by the Board Committees. since 2005, in order to expedite the Board s decision-making process at the operating companies level, an Executive Committee (EXCO) comprising the Executive Directors was established at PNSB and SYABAS respectively whereby both PNSB s and SYABAS EXCO Meetings are held fortnightly (effective March 2010, weekly) and weekly respectively, to deliberate on matters requiring the Board s mandate in between the Board Meetings. The Board of Directors of Sino Water Pte Ltd (Sino Water), the Company s 80% owned Singapore subsidiary meets regularly to deliberate on operational matters. The China Project Coordination Meetings for Sino Water were also held regularly to deliberate on issues relating to Sino Water and the China Projects. the Board has also established the Limits of Authority (LOA) for the Group s operational management matters with the relevant level of authority accorded to the Management. The LOA is continuously reviewed to ensure adequacy, efficiency and integrity in the Group s internal control systems and management information systems. The Board provides the leadership necessary to enable the Group s business objectives to be met, whilst ensuring that the Company s obligations to its stakeholders are met. (j) RE-ELECTION OF DIRECTORS articles 98 and 99 of the Company s Articles of Association (Articles) provide that one third of the Directors shall retire from office by rotation at each Annual General Meeting and all Directors shall retire from office at least once every three (3) years but, shall be eligible and may offer themselves for re-election. article 103 of the Company s Articles provides that any person appointed as an additional Director of the Company shall hold office only until the next following ordinary General Meeting of the Company and shall be eligible for re-election. upon the recommendation of the Nomination Committee, the following Directors shall retire at the forthcoming Thirteenth Annual General Meeting of the Company and being eligible, had offered themselves for re-election: i ii iii iv v vi YBhg Tan Sri Dato Seri Dr Ting Chew Peh, retiring pursuant to Article 98 of the Articles; YBhg Dato Ruslan Hassan, retiring pursuant to Article 98 of the Articles; YAM Tengku Dato Rahimah Almarhum Sultan Mahmud, retiring pursuant to Article 98 of the Articles; YBhg Dato Syed Danial Syed Ariffin, retiring pursuant to Article 99 of the Articles; YBhg Dato Hashim Mahfar, retiring pursuant to Article 103 of the Articles; and Mr Ng Wah Tar, retiring pursuant to Article 103 of the Articles. the information on the Directors standing for re-election at the forthcoming Thirteenth Annual General Meeting is contained in the Statement Accompanying the Notice of Annual General Meeting. 143

150 statement on corporate governance DIRECTORS REMUNERATION (a) PROCEDURE, LEVEL AND MAKE UP OF REMUNERATION the Company has a formal procedure to determine the remuneration of each Board member which are reviewed, from time to time, against market practices. In the case of the Executive Directors, their remuneration are structured so as to link rewards to corporate and individual performance and their remuneration packages comprise a salary, allowances, bonuses and other benefits as normally accorded to similar positions in other comparable companies and sufficiently attractive to retain persons of high calibre. Performance is measured against profits and other targets set from the Company s annual budget and business plans as well as achievements of targeted returns to shareholders. In the case of the Independent Non-Executive Directors, their remunerations reflect their experience, level of responsibilities and contributions and the time spent attending to the Group s affairs and they are paid a fixed monthly allowance, leave passage and meeting allowances for each Board and Board Committee meeting that they attend. the Remuneration Committee is responsible for recommending the remuneration packages of the Directors to the Board. The Board, as a whole, determines the remuneration of the Non-Executive Directors. Individual Directors shall abstain from discussing and voting on their own remuneration at the Board and Remuneration Committee Meetings. (b) DISCLOSURE OF DIRECTORS REMUNERATION the details of the remuneration received and receivable by the Company s Directors (including past Directors) from the Company for the financial year ended 31 December 2009 are as follows: employees leave provident Fees Salaries Bonuses Passage Allowance Fund Total Name of Director rm RM RM RM RM RM RM Tan Sri Rozali Ismail Dato Matlasa Hitam (Resigned on 31/12/2009) Dato Ruslan Hassan 70,000 70,000 Dato Ir Lee Miang Koi 60,000 60,000 Dato Syed Danial Syed Ariffin Tan Sri Dato Hari 100,000 70, ,000 Narayanan Govindasamy Tan Sri Dato Seri Dr 50,000 99, ,000 Ting Chew Peh Tan Seng Lee (Resigned on 31/12/2009) Tengku Dato Rahimah 8,000 8,000 Almarhum Sultan Mahmud Tan Sri Dato Ahmad Fuzi 61,918 76, ,918 Haji Abdul Razak 144

151 the remuneration packages of the Directors of the Company received and receivable from the Group for the financial year ended 31 December 2009 are categorised into the appropriate components as follows: E executive Directors Non-Executive Directors R rm rm Fees Salaries 6,560,370 Bonuses 4,242,711 Benefits-in-kind 155,450 Allowances 803, ,000 Employees Provident Fund 1,732,227 Leave Passage 664, ,918 Total 14,158, ,918 Details of the Directors Remuneration at Company and Group levels for the financial year ended 31 December 2009, in bands of RM50,000 are tabulated as follows: company Level group Level no. of no. of executive Non-Executive no. of Range of Remuneration Per Annum directors directors directors RM1 to RM50, RM100,001 to RM150, RM150,001 to RM200, RM300,001 to RM350,000 1 RM700,001 to RM750,000 1 RM950,001 to RM1,000,000 1 RM1,000,001 to RM1,050,000 1 RM1,950,001 to RM2,000,000 1 RM2,200,001 to RM2,250,000 1 RM6,850,001 to RM6,900,000 1 (c) DIRECTORS SHARE OPTIONS there is no Directors Share Options Scheme in the Company during the financial year ended 31 December

152 statement on corporate governance DIRECTORS TRAINING The Directors keep themselves abreast on the latest regulatory and corporate governance developments, besides enhancing professionalism and knowledge to enable them to discharge their duties effectively. for the financial year ended 31 December 2009, the Directors have attended training programmes, seminars and conferences organised by the Company and the various training providers, such as: Singapore International Water Week th Public Service Forum : Transforming The Nation Constructing The Future, Investing In Prosperity Saudi Water & Power Forum 2009 Bursa Malaysia s High Level Forum For Directors Of Listed Issuers In Enhancing Corporate Governance Governance Expectations Of International Fund Managers CSR & Sustainability As Basis As For Pioneering Business Models Water Malaysia 2009 : An International Conference On Industry Best Practices Malaysian Corporate Governance 2009 Corporate Governance : Lessons From Hong Kong Corporate Governance Guide Towards Boardroom Excellence The Challenges Of Implementing FRS 139 New Framework For Listing And Fund Raising World Islamic Economic Forum Foundation Young Leaders Network Blue Ocean Strategy Conference : Globalisation & New Realities Strategy For High Performance Businesses National Tax Conference 2009 in addition, the Executive Chairman and some Directors have also presented papers at seminars and forums on water-related subjects, both locally and abroad. SHAREHOLDERS COMMUNICATION AND INVESTOR RELATIONS POLICY The Board acknowledges the need for the Company s shareholders and investors to be informed of all material business and corporate developments concerning the Group in a timely manner. In addition to various announcements made during the year, the timely release of the Group s consolidated financial results on quarterly basis provides the shareholders and investors with an overview of the Group s financial and operational performances. The Company maintains regular and effective communication with its shareholders and stakeholders through one-to-one or group dialogues, participation in investor conferences organised by local and foreign institutional houses, attending to shareholders and investors s and phone calls enquiries, Company General Meetings and other Company events. The Annual Report of Puncak Niaga which is produced in line with best corporate governance practices also serves as a key channel of communication with shareholders and investors. Another communication tool to reach shareholders and investors is via our corporate website, with a direct link to SYABAS website, which can be accessed easily and promptly for information on the Group as an ongoing commitment to provide more easily accessible information to the shareholders and investors. The Company s Investor Relations Policy & Report is set out on pages 164 to 166 of this Annual Report. 146

153 ACCOUNTABILITY AND AUDIT (a) FINANCIAL REPORTING the Board is responsible for the quality and completeness of publicly disclosed financial reports. In presenting the annual financial statements, quarterly reports and the annual reports to the shareholders of the Company, the Board takes appropriate steps to present a clear and balanced assessment of the Group s position and prospects. This also applies to other price-sensitive public announcements and reports to the regulatory authorities. the Group s financial statements and quarterly announcements, prepared using appropriate accounting policies, consistently and supported by reasonable and prudent judgements and estimates, will be reviewed and deliberated by the Audit Committee in the presence of the external auditors, internal auditors of the Company and the Executive Director of Finance Division prior to recommending them for adoption by the Board. The Audit Committee ensures that the information to be disclosed are accurate, adequate and in compliance with the various disclosure requirements imposed by the relevant authorities. The Board discusses and reviews the recommendations proposed by the Audit Committee prior to its adoption. The Board also ensures accurate and timely release of the Group s quarterly and annual financial results to Bursa Securities. the Statement of Directors Responsibility in respect of the preparation of the Annual Audited Financial Statements of the Group is set out on page 175 of this Annual Report. (b) RELATIONSHIP WITH EXTERNAL AUDITORS the Board maintains a transparent and professional relationship with the Group s external auditors. The external auditors attended all the Audit Committee meetings of the Company held during the financial year. These quarterly meetings enabled the exchange of views on issues requiring attention. A report by the Audit Committee together with its Terms of Reference is set out on pages 153 to 159 of this Annual Report. (c) INTERNAL CONTROL the Board acknowledges its overall responsibility for maintaining a sound system of internal controls, which provides reasonable assurance in ensuring the effectiveness and efficiency of the Group s operations and to safeguard shareholders investment and its assets and interests in compliance with the relevant laws and regulations as well as the internal financial administration procedures and guidelines. The Group s Statement on Internal Control is set out on pages 151 to 152 of this Annual Report. 147

154 statement on corporate governance OTHER COMPLIANCE INFORMATION (a) SHARE BUY BACK the Company did not implement any share buy back or resale or cancel any of the Company s treasury shares during the financial year ended 31 December As at 31 December 2009, the total number of the Company s treasury shares remained at 2,036,800 ordinary shares of RM1.00 each. (b) OPTIONS, WARRANTS OR CONVERTIBLE SECURITIES there were no options, warrants or convertible securities exercised during the financial year ended 31 December 2009 as the options and warrants had expired, lapsed and became void and ceased to be exercisable after the expiry date or the exercisable period respectively. (c) AMERICAN DEPOSITORY RECEIPT (ADR) / GLOBAL DEPOSITORY RECEIPT (GDR) The Company does not sponsor any ADR or GDR programme. (d) SANCTIONS AND/OR PENALTIES the Company and its subsidiaries, Directors and Management have not been imposed with any sanctions and/or penalties by the relevant regulatory bodies during the financial year ended 31 December (e) NON-AUDIT FEES During the financial year ended 31 December 2009, the Group paid the following non-audit fees to the external auditors: (i) Tax advisory and compliance work RM102,664 (ii) Other non-audit related service RM81,144 non-audit fees payable to the external auditors, Messrs Ernst & Young relates to the review of the Statement of Internal Control and other professional services including tax compliance, tax planning and advisory services. (f) VARIATIONS IN RESULTS there was no material variation in the Audited Financial Statements for the financial year ended 31 December 2009 contained in this Annual Report as compared with the unaudited consolidated results of the Group for the financial year ended 31 December 2009 which was announced to Bursa Securities on 25 February (g) PROFIT GUARANTEE The Company does not provide any profit guarantee to any parties. (h) REVALUATION POLICY ON LANDED PROPERTIES the Group does not adopt a policy of regular revaluation of its property. Details of the Group s properties are disclosed on page 174 of this Annual Report. (i) RECURRENT RELATED PARTY TRANSACTION the Company did not enter into any recurrent related party transaction, which requires the shareholders mandate during the financial year ended 31 December (j) MATERIAL CONTRACTS INVOLVING DIRECTORS AND MAJOR SHAREHOLDERS material contracts entered into by the Company and the Group, which involve the interests of Directors and major shareholders of the Company and its subsidiary companies and material contracts which are still subsisting at the end of the financial year ended 31 December 2009, are as follows: 148

155 C consideration/ Relationship N nature of Mode of with Director/ Date contract parties satisfaction Major Shareholder 15 December 2004 Concession syarikat Bekalan Air Not Applicable YBhg Tan Sri Rozali Ismail (TSRI) A agreement selangor Sdn Bhd is a major shareholder of PNHB (SYABAS), the State held directly under his name and Government of Selangor indirectly held through his 100% Darul Ehsan and the equity interest in Central Plus Government of Malaysia (M) Sdn Bhd (CPlus) and (Federal Government) Corporate Line (M) Sdn Bhd (CLine). PNHB in turn, holds 70% equity interest in SYABAS. 31 December 2004 Shareholders pnhb, Kumpulan Darul Not Applicable TSRI is a major shareholder of A agreement ehsan Berhad (KDEB) pnhb held directly under his name and SYABAS and indirectly held through his 100% equity interest in CPlus and CLine. pnhb in turn, holds 70% equity interest in SYABAS. 23 February 2006 Subscription Agreement In PNHB, KDEB and SYABAS Not applicable TSRI is a major shareholder of R relation To The Subscription pnhb held directly under his name F for Up To RM1.045 Billion and indirectly held through his 100% N nominal Value Of equity interest in CPlus and CLine. R redeemable Cumulative pnhb in turn, holds 70% equity U unsecured Loan Stocks interest in SYABAS. O of SYABAS (RCULS) 8 December 2006 Subscription Agreement Puncak Niaga (M) Sdn Bhd Not applicable TSRI is a major shareholder of I in Relation To The Issue Of (PNSB) (as the Issuer), pnhb held directly under his name rm435.0 Million Nominal United Overseas Bank and indirectly held through his 100% V value Of Redeemable (Malaysia) Bhd (as the equity interest in CPlus and CLine. U unsecured Bonds To PNHB Facility Agent and the Issue pnhb in turn, holds 100% equity A agent) and PNHB interest in PNSB. 16 August 2007 Sungai Lolo Water The State Government Not applicable TSRI is a major shareholder of T treatment Plant of Selangor Darul Ehsan pnhb held directly under his name (Extension) Operation And and PNSB and indirectly held through his 100% M maintenance Agreement equity interest in CPlus and CLine. pnhb in turn, holds 100% equity interest in PNSB. 149

156 statement on corporate governance C consideration/ Relationship N nature of Mode of with Director/ Date contract parties satisfaction Major Shareholder 16 August 2007 Novation Agreement In The State Government Not applicable TSRI is a major shareholder of R relation To The Sungai Lolo of Selangor Darul Ehsan, pnhb held directly under his name Water Treatment Plant PNSB and SYABas and indirectly held through his 100% (Extension) Operation and equity interest in CPlus and CLine. M maintenance Agreement pnhb in turn, holds 100% and 70% equity interests in PNSB and SYABAS, respectively. 7 March 2008 Sg Sireh Water Treatment The State Government Not applicable TSRI is a major shareholder of P plant (Extension) Operation of Selangor Darul Ehsan pnhb held directly under his name and Maintenance Agreement and PNSB and indirectly held through his 100% equity interest in CPlus and CLine. pnhb in turn, holds 100% equity interest in PNSB. 7 March 2008 Novation Agreement The State Government Not applicable TSRI is a major shareholder of T to The Sg Sireh Water of Selangor Darul Ehsan, pnhb held directly under his name T treatment Plant (Extension) PNSB and SYABas and indirectly held through his 100% O operation and Maintenance equity interest in CPlus and CLine. A agreement pnhb in turn, holds 100% and 70% equity interests in PNSB and SYABAS, respectively. 20 February 2009 Supplemental Shareholders PNHB, KDEB, SYABAS Not applicable TSRI is a major shareholder of A agreement (Transfer of 15% and Kumpulan Perangsang pnhb held directly under his name equity interest in SYABAS Selangor Berhad (KPSB) and indirectly held through his 100% comprising 750,000 ordinary equity interest in CPlus and CLine. shares of RM1.00 each from pnhb in turn, holds 70% equity K kdeb to KPSB) interest in SYABAS. 16 December 2009 Loan Facility Agreement SYABAS (Borrower) and the Not applicable TSRI is a major shareholder of (in respect of a loan facility Federal Government pnhb held directly under his name of RM320,800, only) (Lender) and indirectly held through his 100% T the details are set out in the equity interest in CPlus and CLine. A audited Financial pnhb in turn, holds 70% equity S statements of the Group and interest in SYABAS. Company for the financial year ended 31 December 2009 on pages 279 and 300 of this Annual Report STATEMENT OF GOING CONCERN Barring any unforeseen circumstances and upon making due and reasonable enquiry into the affairs of the Group, the Board firmly believes that the Group shall continue to operate as a going concern business in the foreseeable future. This Statement on Corporate Governance has been approved by the Board of PNHB on 26 April

157 statement on internal control INTRODUCTION The Malaysian Code on Corporate Governance (Revised 2007) requires listed companies to maintain a sound system of internal control to safeguard shareholders investments and the Group s assets. The Main Market Listing Requirements of Bursa Malaysia Securities Berhad requires Directors of listed companies to include a statement in their annual reports on the state of their internal controls. RESPONSIBILITY The Boards of the PNHB Group are responsible for maintaining sound systems of internal control and for reviewing their adequacy and integrity so as to safeguard the shareholders investments and the Group s assets. The Boards and Management have implemented a control system designed to identify and manage risks facing the Group in pursuit of its business objectives. This internal control system, by its nature, can only provide reasonable and not absolute assurance against material misstatement or loss. The Group has in place ongoing processes for identifying, evaluating, monitoring and managing significant risks faced by the Group during the year. The Management is responsible for the identification and evaluation of significant risks applicable to their respective areas of business and to formulate suitable internal controls. This process is reviewed by the Board of PNHB via a specific Board Committee, namely the Compliance, Internal Control and Risk Policy Committee, which dedicates its time at periodic intervals throughout the year for discussion on this matter. RISK MANAGEMENT FRAMEWORK Risk Management is firmly embedded in the Group s management system and is every employee s responsibility. In October 2001, the Board of PNHB formally approved a systematic risk management structure and process for the Group. Since then, the structure and process have been fully implemented by the Management and employees of the PNHB Group. The Group s risk management framework is explained in detail in the Risk Management Policy & Report set out on pages 160 to 163 of the Annual Report. INTERNAL CONTROL SYSTEM The key elements of the Group s internal control system and assurance processes, inter alia, encompass the following: all major decisions require the final approval of the respective Boards / Executive Committees within the Group (PNHB / PNSB / SYABAS / Sino Water Pte Ltd) and are only made after appropriate in-depth analysis. The respective Boards / Executive Committees receive regular and comprehensive information covering all Divisions / Departments / Districts in the respective companies within the Group. all Divisions and Departments of PNSB have clearly documented Procedure Manuals and / or Policies whilst SYABAS has Standard Operating Procedures and / or Polices incorporating control procedures and the scopes of responsibilities and authorities. The Procedure Manuals / Standard Operating Procedures / Policies are updated from time to time to incorporate all elements necessitated by changes in the legislation, industry best practices and business dynamics. the Internal Audit Department of PNSB independently reviews the control processes implemented by the Management from time to time and periodically reports on its findings and recommendations to the Audit Committee of PNHB. The duties and responsibilities of the Audit Committee are detailed in the Terms of Reference of the Audit Committee. The Audit Committee, by consideration of both Internal and External Audit Reports, is able to gauge the effectiveness and adequacy of the internal control system, for presentation of its findings to the Board. The Board of SYABAS established an Audit Committee with its own Terms of Reference on 3 August The Internal Audit Division of SYABAS extends a copy of its Internal Audit Reports to the Executive Chairman and summarised Status Reports on its activities are regularly submitted to the Management of SYABAS. the Compliance, Internal Control and Risk Policy Committee, which is chaired by YBhg Tan Sri Dato Seri Dr Ting Chew Peh, an Independent Non-Executive Director of PNHB was established in October This Committee closely monitors the Risk Management process within the Group and the extent of compliance with the Statement on Internal Control requirements. 151

158 statement on internal control the Tender and Contracts Committee of PNSB and the Tender Committees of SYABAS ensure transparency and competitive pricing in the award of contracts within the Group. a detailed budgeting process has been established for PNSB, SYABAS and Sino Water Pte Ltd requiring all Divisions / Departments / Districts to prepare their respective budgets annually. These budgets are then reviewed and approved by the respective Boards / Executive Committees prior to actual implementation each year. The monitoring of actual performance versus budget for PNSB and SYABAS, with major variances being followed up, is done on a monthly basis and Management action is taken to rectify any shortcomings, where necessary. pnsb, SYABAS and Sino Water Pte Ltd have their own Limits of Authorities that have been approved by their respective Boards. self Assessment Audit Forms (which list all key procedures), have been developed for all Departments of PNSB. With effect from 31 March 2008, all Departments are required to submit a quarterly declaration to the Internal Audit Department as to whether all the key procedures have been complied with. Guidance for Directors of Public Listed Companies Since the issuance of the Statement on Internal Control: Guidance for Directors of Public Listed Companies (Guidance) in December 2000, the Group has monitored its level of readiness with the Guidance. The Group aims to not just achieve full compliance, but also to improve on the Group s processes by implementing best business practices in line with international best practice standards. Throughout the year 2009, the Compliance, Internal Control and Risk Policy Committee has closely monitored the Group s level of readiness with the Guidance. This Statement on Internal Control has been prepared in accordance with the Guidance and has been approved by the Board of PNHB and reviewed by the external auditors. For and on behalf of the Board of Puncak Niaga Holdings Berhad Tan Sri Dato Seri Dr Ting Chew Peh Chairman Compliance, Internal Control and Risk Policy Committee 26 April

159 audit committee report The Board of Directors of Puncak Niaga Holdings Berhad (PNHB) is pleased to present the report of the Audit Committee for the financial year MEMBERSHIPS AND MEETINGS the Audit Committee comprises the following members and details of attendance of each member at the Audit Committee Meetings held during the financial year 2009 were as follows: number of Number of Composition of Meetings Meetings Percentage Committee H held attended (%) YBhg Tan Sri Dato Seri Dr Ting Chew Peh Chairman/Independent Non-Executive Director YBhg Tan Sri Dato Hari Narayanan Govindasamy Member/Independent Non-Executive Director YAM Tengku Dato Rahimah Almarhum Sultan Mahmud Member/Non-Independent Non-Executive Director YBhg Tan Sri Dato Ahmad Fuzi Haji Abdul Razak Member/Independent Non-Executive Director the Executive Director (Finance Division), Senior Manager (Internal Audit Department), Senior Manager (Operation I Division, now known as Operation & Maintenance Department with effect from 1 January 2010) and other members of Senior Management attended these meetings upon the invitation by the Chairman of the Audit Committee. The Group s external auditors were also invited to attend these meetings where matters relating to the audit of the statutory accounts and / or the external auditors are to be discussed. The Company Secretaries, Madam Tan Bee Lian and Madam Lim Yew Heang are the Secretaries to the Audit Committee. 2. SUMMARY OF ACTIVITIES During the financial year 2009, the Audit Committee carried out its duties as set out in the terms of reference. The main activities carried out by the Audit Committee during the financial year included the following: Financial Results reviewed the quarterly and year-to-date unaudited financial results of the Group before tabling to the Board for consideration and approval. reviewed the reports and the audited financial statements of the Company and of the Group together with the external auditors prior to tabling to the Board for approval. External Audit reviewed the external auditors scope of work and audit plan for the year and made recommendations to the Board on their appointment and remuneration. reviewed and discussed the external auditors audit report and areas of concern highlighted in the management letter, including management s response to the concerns raised by the external auditors. Discussed on significant accounting and auditing issues, impact of new or proposed changes in accounting standards and regulatory requirements. 153

160 audit committee report Internal Audit reviewed the Internal Audit Plan, programme of resource requirement for the year and assessed the performance of the Internal Audit Department. reviewed the Internal Audit reports, which highlighted the audit issues, recommendations and the Management s responses and directed action to be taken by the Management to rectify and improve the system of internal control. monitored the implementation of recommendations made by the Internal Audit Department arising from its audits in order to obtain assurances that all key risks and control concerns have been fully addressed. Related Party Transactions Reviewed all related party transactions entered into by the Company and the Group. 3. INTERNAL AUDIT FUNCTIONS Puncak Niaga Holdings Berhad (PNHB) / Puncak Niaga (M) Sdn Bhd (PNSB) pnhb/pnsb has an established Internal Audit Department, which assists the Audit Committee in the discharge of its duties and responsibilities. The PNHB/PNSB s Internal Audit Department is headed by En Mohammed Sofian Ismail who is also the Head of the Risk Management Section. En Mohammed Sofian Ismail is a Chartered Member of the Institute of Internal Auditors, Malaysia (CMIIA), a Certified Internal Auditor (CIA) and holds a Certification in Control Self Assessment (CCSA) both from the Institute of Internal Auditors Inc, USA, a Certified Information Systems Auditor (CISA) of the Information Systems and Control Association, USA, a Certified Information Systems Security Professional (CISSP) and Systems Security Certified Practitioner (SSCP) of (ISC) 2, USA and a Master of Business Administration holder from Bond University, Australia. He has more than 26 years working experience in both internal and external audit. The Internal Audit Department provides an independent assurance on risk management, governance and internal control. The Internal Audit Department focuses on regular and systematic review of the internal control and management information systems, including the system for compliance with applicable laws, regulations, rules, directives and guidelines. the Annual Internal Audit Plan of the Internal Audit Department (which was developed based on a risk analysis approach), was approved by the Audit Committee at the 61st Audit Committee Meeting of the Company held on 23 November The scope of the Internal Audit Department s functions covered the audit on the adequacy of risk management, operational controls, compliance with established procedures, guidelines and statutory requirements and also the various computer application systems and networks of the Company and of the Group. the Internal Audit Department has conducted the evaluation of the system of internal control that encompasses the Group s governance, operations and information systems. The Internal Audit reports, which highlights internal control weaknesses, were deliberated by the Audit Committee and the recommendations were duly acted upon by the Management. in 2009, the Internal Audit Department undertook more than 50 major audit assignments covering all the Water Treatment Plants, high-risk areas identified by the Risk Management Scorecard Working Group and adhoc assignments requested by the Senior Management. examples of key areas audited by the Internal Audit Department during the Financial Year 2009 were Risk of Breach of Loan Covenants Finance and Accounts Department, Related Party Transactions, Contract and Procurement Department, Information Technology Security and IT Systems Disaster Recovery Plan, Control Over Firearms, Workshop Operations at SSP2 and Central Region, Central Laboratory Operations, Maintenance of Motor Vehicles, Kelab Briged Penyelamat Sungai, Reviewing Unit Costs of Production for major Water Treatment Plants, etc. 154

161 the total cost incurred by the Internal Audit Department in relation to the conduct of the internal audit functions of PNHB / PNSB during the Financial Year 2009 was about RM871,000. SYABAS Due to the complexity of its water distribution operations which are dissimilar to that of PNSB s water treatment operations, the Board of SYABAS formally ratified the establishment of the Internal Audit Division on 1 September 2006 and an Audit Committee with its own terms of reference was formed on 3 August The Internal Audit Division of SYABAS is headed by Tuan Haji Sonari Solor, a member of the Malaysian Institute of Accountants (MIA), Fellow of the Chartered Association of Certified Accountants (UK) and a professional qualification holder from the Chartered Institute of Management Accountants (UK). Tuan Haji Sonari Solor has more than 21 years of working experience in senior audit and accounting positions with public listed companies. He was formerly the Head of PNHB/PNSB s Internal Audit Department for the period September 1998 to August 2006 before assuming his current position as Head of SYABAS Internal Audit Division. at SYABAS, the audit emphasis for the Financial Year 2009 was to gauge the level and understanding of and compliance with the corporate governance frameworks, policies, procedures and regulatory requirements. Evaluations were made at all levels of the organization including all the ten District Offices. In 2009, the Internal Audit Division conducted 49 major assignments e.g. Review of Loan Covenants, Compliance with the Concession Agreement, Review of Internal Control System in BASIS, Review of Compliance with Health, Safety and Environmental Requirements at Site, Review of Compliance with Contract Agreement on Meter Monitoring Systems etc. the total cost incurred by the Internal Audit in relation to the conduct of the internal audit function of SYABAS during the year was about RM830, TERMS OF REFERENCE OF PNHB S AUDIT COMMITTEE A. Composition the Board shall elect an Audit Committee from amongst themselves (pursuant to a resolution of the Board of Directors), comprising of at least three (3) Directors which fulfils the following requirements: i ii all the members of the Audit Committee must be Non-Executive Directors of the Company (and excluding Alternate Directors) with a majority of them being Independent Directors; and At least one (1) member of the Audit Committee: a must be a member of the Malaysian Institute of Accountants; b if he is not a member of the Malaysian Institute of Accountants, he must have at least three (3) years working experience and: 1) he must have passed the examinations specified in Part I of the 1st Schedule of the Accountants Act 1967; or 2) he must be a member of one of the associations of accountants specified in Part II of the 1st Schedule of the Accountants Act 1967; or 3) fulfils such other requirements as prescribed or approved by the Exchange. the members of the Audit Committee shall elect a Chairman from amongst themselves who shall be an Independent Director. It would be advantageous if the Chairman possesses a strong personality, have knowledge and experience in financial reporting, good leadership skills and is keen to get financial reporting and controls right. the Chairman of the Audit Committee will maintain continuous engagement with the Board Members and Senior Management of the Company and the external auditors in order to be kept abreast of matters affecting the Company. All members of the Audit Committee should be financially literate. 155

162 audit committee report all members of the Audit Committee, including the Chairman, will hold office only so long as they serve as Directors of the Company. Should any member of the Audit Committee cease to be a Director of the Company, his membership in the Audit Committee would cease forthwith. if the members of the Audit Committee for any reason be reduced to below three (3), the Board of Directors shall within three (3) months of the event, appoint such number of new members as may be required to make up the minimum number of three (3) members. B. Objectives the primary objectives of the Audit Committee are to: i ii iii iv v provide assistance to the Board in fulfilling its fiduciary responsibilities, particularly in the areas relating to the Company s accounting and management controls, financial reporting and business ethics policies. provide greater emphasis on the audit function by increasing the objectivity and independence of external and internal auditors and providing a forum for discussion that is independent of the Management. maintain through regularly scheduled meetings a direct line of communication between the Board and the external auditors, internal auditors and financial management. Strengthen the role of Non-Executive Directors by improving their knowledge and understanding of the Company s operation. undertake such additional duties as may be appropriate and necessary to assist the Board. However, whether or not the Audit Committee should undertake one or more of the additional duties rests on the Board s viewpoint on corporate needs and the environment in which the Company operates. C. Duties And Responsibilities in fulfilling its primary objectives, the Audit Committee will need to undertake the following duties and responsibilities: C.1 Oversee All Matters Relating to External and Internal Audits i review the Annual Audit Plan with the external auditors. The Committee shall meet with the external auditors prior to the commencement of the annual audit to discuss: the general outline of the extent and timing of the auditors proposed coverage of location such as branches, departments, factories, divisions and subsidiaries. The nature of the audit procedures to be performed. the extent of any planned reliance on the work of the internal auditors and the anticipated effect of this reliance on the examination. Any significant accounting and auditing problems that the auditors can foresee. the impact on the financial statements of any new or proposed changes in accounting standards or regulatory requirements. The effect on the audit of significant data-processing systems. following its review of the plan, the Audit Committee may request the external auditors to perform additional audit work directed to specific areas of concern to the Committee. 156

163 ii Oversee the Internal Audit Department. The Audit Committee in overseeing the Internal Audit Department will: Review the audit programme, scope, performance and findings of the internal auditors. monitor the implementation of the programme so that sufficient internal audit coverage is accorded. In this respect, only the Committee can consider and approve or otherwise, all requests by Senior Management to utilise the internal audit personnel for non-audit assignments. assess the capacity of the Internal Audit Department to fulfil its responsibilities by considering, amongst other things, the adequacy of the scope of the Department s authority as presented in the Department s charter, the competency, qualifications and experience level of its employees, the degree to which internal auditors are independent of the activities they audit and the reporting relationship between the Head of Internal Audit and Senior Management. Review any appraisal or assessment of the performance of the staff of the Internal Audit Department. Approve any appointment or termination of the Head of the Internal Audit Department. to take cognizance of the staff resignations in the Internal Audit Department and their reasons for resigning as stated in the Exit Interview Form(s). the Internal Audit Department shall exercise independence, impartiality, proficiency and due professional care in the discharge of its internal audit function and the activities it audits within the Company and Group. to review the coordination of audit efforts between external and internal auditors, where practical, with a view to maximising audit effectiveness and controlling external audit costs. iii iv v vi Review the assistance and cooperation given by the Company s officers to the external and internal auditors. Any letter of resignation from the external auditors. to recommend the nomination of a person or persons as external auditors or re-appointment or whether there is reason (supported by grounds) to believe that the external auditors is not suitable for re-appointment. the external and/or internal auditors shall have the right to appear and be heard at any meeting of the Audit Committee and shall appear before the Audit Committee when required to do so by the Audit Committee. vii upon the request of the external and/or internal auditors, the Chairman of the Audit Committee shall convene a meeting of the Committee to consider any matters the auditors believe should be brought to the attention of the Committee. viii the Audit Committee may convene meetings with the external auditors and/or internal auditors, excluding the attendance of other Directors and employees of the Company, whenever deemed necessary. C.2 Evaluate the Standards of Internal Control and Financial Reporting i Hold specific discussions with Senior Corporate Management to discuss the overall adequacy of the internal control system. ii iii Meet with the internal and external auditors concerning their evaluation of the system of internal accounting controls. Consider the nature and disposition of the relevant comments appearing in the reports prepared by the internal auditors and in the external auditors management letter. 157

164 audit committee report C.3 Review of Financial Statements i meet with the Management and the external auditors to discuss the annual financial statements of the Company or Group and the results of the audit before recommending approval by the Board. ii iii iv v vi review the changes in or implementation of major accounting policy changes, the nature and resolution of any significant accounting and auditing problems encountered during the examination. it is good practice for the Audit Committee to meet the Management at a regular interval to review the results of the Company or Group, such as quarterly review of the results. review the nature of any related party transaction and conflict of interest situation that may arise within the Company or the Group including any transaction, procedure or course of conduct that raises questions of the Management s integrity. review the nature of any significant adjustments and unusual events, reclassifications or additional disclosures proposed by the external auditors that are currently significant or may become significant in the future. review the adequacy of disclosure of the impact of any changes during the year in accounting policies, standards and/or regulatory requirements. vii Review the reasons for the major fluctuations in financial statement balances for the current year compared to prior years. viii review for any unusual circumstances or situations reflected in the financial statements, including identifying any marginal operations. ix x xi Review the nature of any unusual or significant commitments or contingent liabilities. Review of any significant differences between the annual report and other reports, such as reports to the regulatory agencies. Review for any significant differences in format or disclosure from industry norms. C.4 Additional Duties and Responsibilities i act upon the Board of Directors request to investigate and report on any issues or concerns in regard to the management of the Company. ii iii iv v vi review the Company s business ethics code, the method of monitoring, compliance with the code and the disposition of reported exceptions. Review executive expenses. Review policies on sensitive payments. Review compliance with certain government regulations. review policies to avoid conflicts of interest and review past or proposed transactions between the Company and members of the Management. 158

165 vii Review certain aspects of the Company s pension plan and compliance with relevant laws and regulations. viii Assess the performance of financial management. ix x Such other functions as may be agreed to by the Audit Committee and the Board of Directors. When the Audit Committee is of the view that a matter reported by it to the Board of Directors has not been satisfactorily resolved resulting in a breach of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the Audit Committee shall promptly report such matter to the Exchange. D. Access to Records in carrying out their duties and responsibilities, the Audit Committee will in principle have full, free and unrestricted access to all Company records, property and personnel. E. Meetings and Minutes it is good practice for the Audit Committee to hold a minimum of four (4) meetings a year, although additional meetings may be called at any time at the Chairman s discretion. It would be desirable that the notice of meetings be sent at least seven (7) days before the time set for the meeting together with an agenda to all members of the Committee and any persons that may be required to attend. The recommended quorum for each meeting shall be three (3) members, with the majority of members present being Independent Directors. in addition to the Committee members, the Executive Director of Finance Division and the Head of Internal Audit Department will normally be in attendance at the meetings. Representative of the external auditors are to be in attendance at meetings where matters relating to the audit of the statutory accounts and/or the external auditors are to be discussed. the Chief Executive Officer, other Board Members and/or other appropriate officers may be invited to attend, except for those portions of the meetings where their presence is considered inappropriate, as determined by the Committee Chairman. the Audit Committee will meet with the external auditors without the Executive Directors present at least twice a year. minutes of each meeting shall be kept and distributed to each member of the Committee and also to the members of the Board. The Committee Chairman shall report on each meeting to the Board. The Secretary to the Audit Committee shall be the Company Secretary. 159

166 RISK MANAGEMENT POLICY & REPORT RISK MANAGEMENT POLICY The Board of Puncak Niaga Holdings Berhad has approved the following Group s Risk Management Policy Statement: The PNHB Group s Risk Management Policy is to identify, measure and control risks that may prevent the Group from achieving its objectives. Our challenge is to apply risk management to all parts of our business to ensure business risks are minimised and opportunities enhanced. We will achieve, maintain and review a proper risk management system. This commitment is driven by the Board of Directors, which in turn is implemented by the Management and extends to all employees of the Group. This policy statement assigns responsibility for risk management to all PNHB Group employees and acknowledges that corporate responsibility lies with the Board of Directors of the PNHB Group. RISK MANAGEMENT REPORT There are risks faced by all companies in the various facets of their corporate lives. The nature of such risks including systemic, market, employees, economic, legislation, financial and others, need to be identified and managed to reduce the possibility and impact of any adverse effects. Puncak Niaga recognises this and has initiated risk management programmes to ensure its business risks are minimised and opportunities enhanced. The following steps were taken by the Board of Puncak Niaga in October 2001, for the management of the Group s corporate risks: 1. The preparation of the Group s Risk Management Policy Statement. 2. The formation of the Compliance, Internal Control and Risk Policy Committee (CICR) with its own Terms of Reference. 3. The setting up of a Risk Management Section, which reports to the CICR. As a follow-up from the Strategic Corporate Risk Management Workshop held for the Board and Senior Management in August 2001, information on Risk Management has been fully disseminated to all employees in the form of posters and through the Group s internal communications network. In addition, the risk management framework which was established in October 2001 has since then been fully implemented by the Management and employees of Puncak Niaga. A second Strategic Enterprise-Wide Risk Management Workshop was conducted for Directors and Senior Management staff, by an external consultant on 11 September

167 COMPLIANCE, INTERNAL CONTROL AND RISK POLICY COMMITTEE (CICR) The establishment of the CICR was formalised by the Board in October The members of the CICR comprise the following: Chairman : YBhg Tan Sri Dato Seri Dr Ting Chew Peh (Independent Non-Executive Director) Members : YBhg Dato Hashim Mahfar managing Director (Head of Compliance, Internal Control and Risk Policy Committee) mr Danny Ng Wah Tar executive Director, Finance Division madam Tan Bee Lian Executive Director, Corporate Services Division - PNSB tuan Haji Sonari Solor Senior General Manager, Internal Audit Division - SYABAS Secretary : Encik Mohammed Sofian Ismail Senior Manager, Internal Audit Department - PNSB (Head of Risk Management Section) YBhg Dato Hashim Mahfar and Mr Danny Ng Wah Tar were appointed as Head and member of the CICR respectively, with effect from 1 January YBhg Dato Matlasa Hitam resigned as the Head of the CICR with effect from 31 December YBhg Dato Matlasa Hitam had been the Head of the CICR since 24 February A) TERMS OF REFERENCE OF THE CICR the CICR shall provide assistance to the Board of Directors of Puncak Niaga in discharging its fiduciary responsibilities relating to safeguarding shareholders investment and the Group s assets through a structured approach to Risk Management. The primary responsibilities of the CICR are: formulating strategies to manage the overall risks associated with the Group s activities. This entails decisions on: Long-term and short-term strategies. Justifiable capital allocation based on return per unit of risk. recommending the appropriate risk management policies and procedures, which shall be reviewed frequently to ensure consistency with fundamental changes in the economy, market conditions and regulations. reviewing periodically the Group s overall objectives by assessing the current risk portfolio composition and determining the desired exposures of each major area of risk. Monitoring and assessing the risk portfolio composition of significant activities of the Group. keeping abreast of both current risk management techniques and theories, and any possible or actual changes in the regulatory environment, and recommending the appropriate action. 161

168 RISK MANAGEMENT POLICY & REPORT B) CICR ACTIVITIES MEETINGS HELD AND ISSUES COVERED During the year 2009, the CICR held eight (8) meetings, of which four (4) were chaired by YBhg Tan Sri Dato Seri Dr Ting Chew Peh (Chairman of CICR) and four (4) were chaired by YBhg Dato Matlasa Hitam (Head of CICR) until 31 December at its meetings, the CICR reviewed in detail, the Status Reports prepared by the Risk Management Section. The issues covered include the following: 1. the level of readiness of PNSB and the respective Divisions and Departments with regards to the Statement on Internal Control requirements. 2. the progress of the risk assessment and risk monitoring exercises at Departmental / Divisional and Enterprise-Wide levels. The main risks, controls and management actions are highlighted for the CICR to deliberate. 3. the effective utilisation of the Corporate Risk Scorecard software to identify, measure and monitor all corporate risks identified within PNSB and Sino Water Pte Ltd. 4. Other relevant risk issues affecting the Group, from time to time. RISK MANAGEMENT SCORECARD WORKING GROUP AND ENTERPRISE-WIDE RISKS The Group recognises that Risk Management involves a structured approach, combining the efforts of all functions within the Group, to minimise the possibility and impact of unexpected damages so as to contribute towards greater efficiency and better decision-making. The Group s Enterprise-Wide Risk Profile is reviewed annually to take into consideration changes in the business environment, strategies and functional activities of the Group. The Risk Management Scorecard Working Group (RMSWG), comprising all Heads of Departments or their representatives, met on 14, 16 and 29 October 2009 to review the Group s Enterprise-Wide Risk Profile. SYABAS Report Major Risks Facing SYABAS 2009 / 2010 was provided to the CICR on 29 March The deliberations of the RMSWG and the Report from SYABAS were reviewed by the CICR on 14 April Subsequently, a detailed Board Paper on the Group s Top Ten Enterprise Wide Risks was tabled at PNHB s Board of Directors Meeting held on 26 April The Group s Enterprise-Wide Risk Profile will be reassessed by the RMSWG in the second half of RISK SCORECARD REPORTING (PNSB AND SINO WATER PTE LTD) The respective Heads of Divisions and Departments of PNSB and the Managing Director of Sino Water Pte Ltd are responsible for assessing and managing their respective risks. Using the Corporate Risk Scorecard software (upgraded to the Q-RADAR System V6 in September 2008), the respective Heads of Divisions and Departments of PNSB and the Managing Director of Sino Water Pte Ltd submit their detailed risk scorecard reports to the Risk Management Section every quarter. Risk Management Section analyses and summarises the risk scorecard reports received for further deliberation by the CICR. 162

169 CORPORATE RISK SCORECARD SOFTWARE PNHB, PNSB and Sino Water Pte Ltd utilise a risk management tool namely, the Corporate Risk Scorecard (CRS) software to identify, measure and manage all corporate risks affecting PNSB. The CRS software offers a systematic approach to the management of enterprise-wide risks facing corporations and assists the Management of Puncak Niaga to successfully achieve their corporate objectives. In September 2008, the previous CRS software (Version 2) was upgraded to the Q-RADAR System V6. The upgraded software is web-based and allows authorised users to monitor their respective risks on-line from any location. As at 31 December 2009, the Q-RADAR CRS software has more than 80 authorised users and covers 18 Departments / Divisions, including Sino Water Pte Ltd. The Q-RADAR CRS software is administered by the Risk Management Section. RISK MANAGEMENT AT SYABAS A Risk Management Workshop was conducted for all relevant Heads (or their representatives) of Divisions and Departments by the Internal Audit Division on 11 August Broadly, the topics covered during the Workshop were: 1. Risk Management Awareness. 2. Risk Management Thought Process. 3. Risk Management Scorecard Software (Q-RADAR). The Risk Management Working Group (comprising all Heads of Divisions and Departments) then deliberated upon the Enterprise-Wide Risks Facing SYABAS For 2009 / 2010 on 27 October 2009, 10 November 2009, 3 December 2009 and 19 February Matters discussed included: 1. Likelihood of risk events happening. 2. Evaluation of the consequences of the risk events happening. 3. Confirmation as to whether controls are in place and are being used to manage the risks. 4. risks ranking from the highest to the lowest to produce a priority list. Subsequently, SYABAS submitted its Report Major Risks Facing SYABAS 2009 / 2010 to the CICR on 29 March

170 INVESTOR RELATIONS POLICY & REPORT As a responsible corporate citizen, Puncak Niaga is totally committed to upholding the highest standards of transparency, accountability and integrity in the conduct of our business activities in the best interest of our shareholders as well as to allow potential investors to make careful and informed investment decisions based on full and transparent disclosure of information. Puncak Niaga s Investor Relations Policy aims to build long-term relationships and credibility with our shareholders and potential investors based on trust, honesty, openness, transparency and sound understanding of the Company. To achieve its objectives, the Company will endeavours to undertake the following: 1. CREATING QUALITY DIALOGUE to create an environment where the effective bilateral communication between the Company and our shareholders and investors both informs and educates through regular, open and transparent provision of relevant and invaluable information over the long-term, which will build mutually beneficial long-term relationships vis-à-vis to foster a clearer understanding of the shareholders and investors expectations of the Company. to engage in quality dialogue with our shareholders and investors whereby the relationship is based on the principles of honesty, openness and transparency and to foster mutual understanding between the Company and our shareholders and investors. To reap the benefits of engaging in quality dialogue: - Perception on our Company s risk is reduced; - Enhance feedback of our Company s performance; - Our Company s share valuation becomes more realistic; - Develop confidence in our Management team and management style; and - Works as a guide in the evaluation of our Company s business strategy. 2. INVESTOR COMMUNICATIONS STATEMENT to implement an efficient and effective Investor Relations Programme as part of our ongoing shareholders and investors communication obligations. to provide high quality, meaningful and timely information over and above that is required by law in order to improve the shareholders and investors understanding of our Company. to strive for key competence in the area of professional investor relations vide adequate resources and capabilities. To earn the trust, respect and confidence of our existing shareholders and investors. To build and maintain long-term relationships with our existing shareholders and investors. To initiate long-term relationship building with potential shareholders and investors. Our commitment to the above Policy is driven by the Board of Directors of PNHB Group and implemented by the Management. 164

171 INVESTOR RELATIONS REPORT Investor relations is the means by which listed companies maintain dialogue with their existing shareholders and potential investors. It is a strategic management responsibility to present an accurate picture of corporate performance and prospects, thus enabling the investment community, through an informed market, to determine a realistic share price. As a result, investor relations can have a positive impact on the Company s market value and cost of capital relative to its industry sector and the overall economic climate. The year 2009 had been challenging amidst Puncak Niaga s relentless pursuit to gain leadership in the water industry and to remain focused in achieving our Vision and Mission. The Board is therefore pleased to report on Puncak Niaga s investor relations activities during 2009 as follows: DIALOGUES WITH INVESTORS The Top Management of the Group actively engages in meetings, dialogues and briefing sessions with local and foreign institutional groups. In 2009, 20 dialogues and group briefing sessions were conducted with existing and potential investors, local and foreign fund managers and financial analysts from research and asset management houses. INVESTORS ACCESS TO INFORMATION In line with our Investor Relations Policy, Puncak Niaga ensures timely disclosure of information over and above the regulatory authorities disclosure requirements so as to enable the investment community to make careful and informed investment decisions on the Company s securities. Shareholders and investors can contact us at investors@puncakniaga.com.my and access the Group s information and corporate announcements at our website, (with a direct link to or All shareholders queries will be received by the Group Company Secretary who will provide feedback and responses to shareholders queries where such information can be made available to the public. Since 22 October 2004, in our efforts to meet disclosure obligations towards our shareholders, investors and stakeholders, the Group had adopted and implemented the Puncak Niaga Corporate Disclosure Policy (as set out on page 136 of this Annual Report), formulated in line with the Guide On Best Practices In Corporate Disclosure issued by Bursa Malaysia Securities Berhad s Task Force on Corporate Disclosure Best Practices. ANNUAL GENERAL MEETING (AGM) The Board of Puncak Niaga firmly believes that the AGM is the best forum to promote a closer relationship with our shareholders, enabling us to continue our engagement process with them. Since 2003, our AGMs have been preceded by a Company Presentation followed by a Question and Answer Session. Our shareholders are updated on the Group s corporate performance, latest developments and issues of concern to the shareholders. This is especially important as we are the water services provider in the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya and our shareholders are our consumers. It is Puncak Niaga s way of saying We value your views and We are here to serve you better. At the same time, our shareholders feedback which are relevant to our operations are taken into consideration in our business decisions. Since 2007, we have set up the PUSPEL customer service counter at a secretariat room at the AGM venue to enable our shareholders to gain online access to SYABAS water related enquiries. In view of our role as a water services provider, we will continue with this practice at our future AGMs for the benefit of our shareholders. 165

172 INVESTOR RELATIONS POLICY & REPORT INVESTOR RELATIONS UNIT The Investor Relations Unit (IRU) maintains a database of shareholders and investors who wish to be updated on the Group s corporate developments and performance via . Kindly us your contact details to the attention of Madam Tan Bee Lian, Group Company Secretary at investors@puncakniaga.com.my or by mail at Investor Relations Unit, c/o Secretarial Department, Puncak Niaga Holdings Berhad, 10th Floor, Wisma Rozali, No. 4, Persiaran Sukan, Seksyen 13, Shah Alam, Selangor Darul Ehsan, should you wish to be included in our database. Similarly, to enable us to further improve our level of services to the community and our stakeholders, kindly forward your comments, views and concerns to us at corpcom@puncakniaga.com.my for public enquiries and investors@puncakniaga.com.my for investors enquiries. All water-related enquiries in the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya, such as complaints on water disruptions, pipe bursts or low water pressure, may be addressed to SYABAS Customer Service Centre, puspel@syabas.com.my or the tollfree line, or SMS PUSPEL <space> <your complaints/feedback> to or the social network on Twitter and Facebook, follow@puspel. 166

173 quality policy & report Quality policy It is the Policy of Puncak Niaga to provide quality services and products to meet the customer requirements and satisfaction. Puncak Niaga shall strive to consistently adopt and maintain a quality management system based on all regulated requirements, internationally recognised standard which will ensure a planned, systematic, and proactive approach to quality in all aspects of our work. Puncak Niaga is also committed in providing a safe, harmonious and conducive working environment and continuously equips our employees with knowledge and skill to improve our quality systematically. Puncak Niaga Quality Management will be characterised by: A culture of continual improvement and teamwork. Pro-activeness at all levels. The consistent application of Right First Time Every Time principle. Empowerment of personnel to solve problems expeditiously. All employees shall share the responsibility to understand and diligently implement the Quality Policy. INNOVATIVE & CREATIVE CIRCLE (ICC) PROGRAMME The ICC Programme is a platform to measure staff capability in maximising their knowledge and experience to extend creative ideas in solving work-related issues to increase the Company s productivity and cost-benefit. PNSB s ICC Secretariat ( the Secretariat ) had successfully conducted its fourth ICC Programme. The ICC Programme does not only support productivity enhancement, it is also designed as a channel in developing a customer-centric workforce. The ICC Programme may contribute towards the supply of technically skilled, knowledgeable and innovative workforce who possesses important generic skills such as leadership skills, interpersonal effectiveness, thinking skills, personal and professional effectiveness and effective communication skills. The ICC Programme is a reflection of the Company s continuous efforts in enhancing productivity and competitiveness. For the ICC Programme, a total of 22 (twenty two) teams initially participated in the ICC Programme. They comprised 11 (eleven) teams from the Head Office and 11 (eleven) teams from the Water Treatment Plants (WTPs). To equip the 22 (twenty two) teams with the necessary knowledge and tools to carry out their projects, a formal training was organised by Malaysia Productivity Corporation (MPC) in February 2009 to provide an overview of what ICC is all about and to further emphasise the use of innovation and creativity in solving work-related issues that would result in higher productivity and cost saving. Based on the criteria set by MPC and after careful consideration, the Secretariat shortlisted 16 (sixteen) teams, out of which, six (6) teams with the following six (6) projects have been selected for final presentation: Facilitate and expedite the processing of claim submitted by WTP staff with the introduction of T-Transaction. Stabilisation of lime dosage at the old Rantau Panjang WTP. Optimisation of micro sand usage. High cost lab testing bacteriological on weekly basis for buffer dilution water. Optimising the life span and reducing the frequency of fault of the water sampling pump. Increasing the rate of raw water flowing from intake to WTP. The ICC Programme s final presentation was held on 26 January 2010 at Wisma Rozali with the winning project being optimisation of micro sand usage, followed by optimising the life span and reducing the frequency of fault of the water sampling pump and increasing the rate of raw water flowing from intake to WTP. 167

174 Health, safety and environmental policy It is the policy of Puncak Niaga Holdings Berhad and its subsidiaries (Puncak Niaga Group) to provide, so far as is practicable healthy, safe and environmental friendly workplace for all employees, contractors, visitors, interested members of society and others, and in the spirit of consultation and cooperation, the Management and employees will together strive to achieve goals and objectives of this Policy. Without prejudice to the generality of the above statement, the Policy of Puncak Niaga Group is: to provide and maintain a healthy, safe and environmental friendly workplace and system of work, and to continually improve its environment and safety performance; to continuously emphasize on the prevention of injury, ill health and pollution in all activities; to ensure environmental and safety objectives and targets are set and reviewed; to ensure all employees are informed, instructed, trained and supervised on how to perform their jobs safely and without risk to health and without any harm to the environment; to investigate all occupational health, safety and environment incidents, and to make corrective measures to ensure the incidents will not recur; to comply with all legal and other requirements on health, safety and environment and other good practices which the Group subscribes; to review this policy as and when appropriate and to ensure it is understood by all employees and is available to all interested parties. 168

175 SYAbas corporate responsibility policy At Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS), there is an underlying and long standing commitment to ethical practice based upon the belief that business can be both profitable and responsible. We have always believed that building meaningful long term relationships with employees, suppliers, and communities is good business practice for us and is what our stakeholders expect of us. This is, and always has been, the founding principle of our commitment to Corporate Responsibility (CR). SYABAS recognises both the business imperative and the moral obligation to carry out our activities in a socially responsible and environmentally sustainable manner. Leveraging on our long history of social awareness and charitable work, SYABAS aim is to contribute to a sustainable future through: ENVIRONMENTAL IMPACTS: We shall manage development activities in order to minimise the risk of pollution and waste; EMPLOYEES: We shall respect the rights and diversity of employees, providing good conditions of work and equal opportunities, improving employee satisfaction, whilst enhancing the intellectual capital of SYABAS continuously through training and development; Ethics: We shall encourage high standards of integrity and professionalism throughout SYABAS and providing a framework to manage the risk of unethical behaviour; RELATIONSHIPS WITH CONSUMERS: We shall anticipate and satisfy consumers needs and providing a high quality of customer service by registering and resolving consumers complaints in accordance to our published Client Charter, Mandatory Level of Services and Concession Agreement; SUPPLIERS AND PARTNERS: We shall treat all our suppliers fairly whilst delivering enhanced value and social improvements in partnership with them. We will operate in a way that safeguard against unfair business practices and shall encourage suppliers and contractors to adopt responsible business policies and practices for mutual benefit; COMMUNITY INVOLVEMENT: We shall support philanthropic and charitable giving, support for and active engagement with local communities through volunteering and other programmes. We shall also support and encourage our employees to help local community organisations and activities in the areas where we operate in; ENGAGEMENT WITH STAKEHOLDERS: We shall listen and engage with local communities and responding positively to requests for information from our stakeholders in a timely and accurate manner. 169

176 distribution schedule of equity securities as at 27 april 2010 Analysis of Shareholdings Authorised Share Capital : RM1,300,000, Issued and Paid-Up Share Capital : RM411,142, comprising 411,142,895 ordinary shares of RM1.00 each Class of Shares : Ordinary shares of RM1.00 each Voting Rights : One vote per ordinary share Distribution of Shareholdings shareholders N no. of Shares held Size of Malaysian Foreigner Total Malaysian Foreigner total Shareholdings No. % No. % No. % No. % No. % No. % Less than ,888 * 147 * 12,035 * 100-1,000 1, , ,042, ,285 * 1,053, ,001-10,000 4, , ,765, , ,065, , , ,183, ,753, ,937, ,001-20,455, # 1.58 # # 1.86 # 126,731,337 # # 33,167, ,899,203 # # (less than 5% of the issued share capital) 20,455,305 (5% of the ,026, ,112, ,138, issued share capital) and above Total 7,368 # # ,542 # # 345,760,804 # # 63,345, ,106,095 # # Notes: * Negligible. # Excluding a total of 2,036,800 PNHB shares bought back by PNHB and retained as treasury shares as at 27 April List of Top Thirty Securities Account Holders As Per Record of Depositors (Without aggregating the securities from different securities accounts belonging to the same Depositors) % of Issued N no. of and Paid-Up No. Name of Shareholder shares Held Share Capital # 1. CIMB Group Nominees (Tempatan) Sdn Bhd 39,000, WWE Holdings Bhd For Corporate Line (M) Sdn Bhd (49988 JTRK) 2. RHB Capital Nominees (Tempatan) Sdn Bhd 33,000, Pledged Securities Account For Central Plus (M) Sdn Bhd (681055) 3. Employees Provident Fund Board 32,954, Central Plus (M) Sdn Bhd 28,941, Note: # Excluding a total of 2,036,800 PNHB shares bought back by PNHB and retained as treasury shares as at 27 April

177 % of Issued N no. of and Paid-Up No. Name of Shareholder shares Held Share Capital # 5. HSBC Nominees (Asing) Sdn Bhd 28,112, Exempt An For JPMorgan Chase Bank, National Association (Bermuda) 6. AmanahRaya Trustees Berhad 26,210, Amanah Saham Wawasan AmSec Nominees (Tempatan) Sdn Bhd 21,920, AmBank (M) Berhad For Central Plus (M) Sdn Bhd 8. UOBM Nominees (Tempatan) Sdn Bhd 19,900, Pledged Securities Account For Central Plus (M) Sdn. Bhd. (PCB) 9. Citigroup Nominees (Tempatan) Sdn Bhd 16,020, CMS Trust Management Berhad For Employees Provident Fund 10. AmSec Nominees (Tempatan) Sdn Bhd 11,918, AmTrustee Berhad For Central Plus (M) Sdn Bhd (CS-CPlus) 11. AmanahRaya Trustees Berhad 10,543, Amanah Saham Malaysia 12. HSBC Nominees (Asing) Sdn Bhd 9,092, Exempt An For Morgan Stanley & Co. Incorporated (Client) 13. Cartaban Nominees (Asing) Sdn Bhd 8,584, State Street Australia Fund ATB1 For Platinum Asia Fund 14. HSBC Nominees (Asing) Sdn Bhd 7,443, BNY Brussels For Powershares Global Water Portfolio 15. HSBC Nominees (Tempatan) Sdn Bhd 6,300, Pledged Securities Account For Central Plus (M) Sdn Bhd ( ) 16. Citigroup Nominees (Tempatan) Sdn Bhd 5,673, Exempt An For Prudential Fund Management Berhad 17. HSBC Nominees (Tempatan) Sdn Bhd 5,000, Nomura Asset Mgmt Malaysia For Employees Provident Fund Note: # Excluding a total of 2,036,800 PNHB shares bought back by PNHB and retained as treasury shares as at 27 April

178 distribution schedule of equity securities as at 27 april 2010 % of Issued N no. of and Paid-Up No. Name of Shareholder shares Held Share Capital # 18. AmSec Nominees (Tempatan) Sdn Bhd 4,312, CMS Trust Management Berhad For Tenaga Nasional Berhad Retirement Benefit Trust Fund (RB-TNB-CMS) 19. ECML Nominees (Tempatan) Sdn. Bhd 2,979, Pledged Securities Account For Ng Yim Hoo (001) 20. AmanahRaya Trustees Berhad 2,571, Public Islamic Select Treasures Fund 21. Mayban Nominees (Tempatan) Sdn Bhd 2,500, Pledged Securities Account For Corporate Line (M) Sdn Bhd ( A) 22. HSBC Nominees (Tempatan) Sdn Bhd 2,043, HSBC (M) Trustee Bhd For CMS Premier Fund (4959) 23. AmanahRaya Trustees Berhad 2,040, Public Islamic Opportunities Fund 24. Permodalan Nasional Berhad 1,990, Corporate Line (M) Sdn Bhd 1,818, Central Plus (M) Sdn Bhd 1,738, Rozali Bin Ismail 1,729, HSBC Nominees (Tempatan) Sdn Bhd 1,726, HSBC (M) Trustee Bhd For CMS Malaysian Inc Fund ( ) 29. Kumpulan Wang Simpanan Pekerja 1,494, Citigroup Nominees (Asing) Sdn Bhd 1,352, UBS AG Total 338,910, Note: # Excluding a total of 2,036,800 PNHB shares bought back by PNHB and retained as treasury shares as at 27 April

179 DIRECTORS INTEREST IN ORDINARY SHARES AS PER REGISTER OF DIRECTORS SHAREHOLDINGS no. of Shares Held in the Company D direct indirect No. Name of Director Interest % # Interest % # 1. YBhg Tan Sri Rozali Bin Ismail 1,729, ,037, YBhg Dato Hashim Bin Mahfar YBhg Dato Ruslan Bin Hassan YBhg Dato Ir Lee Miang Koi 10,000 * YBhg Dato Syed Danial Bin Syed Ariffin YBhg Tan Sri Dato Hari Narayanan A/L Govindasamy YBhg Tan Sri Dato Seri Dr Ting Chew Peh ,000 ^ Mr Ng Wah Tar YAM Tengku Dato Rahimah Binti Almarhum Sultan Mahmud YBhg Tan Sri Dato Ahmad Fuzi Bin Haji Abdul Razak Notes: + Deemed interest by virtue of 100% equity interest each in Central Plus (M) Sdn Bhd and Corporate Line (M) Sdn Bhd of which 92.5% is held in own name and 7.5% is held in his children s names, respectively. ^ Deemed interest by virtue of shares held by spouse, Tay Boon Ling pursuant to Section 134 of the Companies Act, # Excluding a total of 2,036,800 PNHB Shares bought back and retained as treasury shares as at 27 April * Negligible. SUBSTANTIAL SHAREHOLDERS based on the REGISTER OF SUBSTANTIAL SHAREHOLDERS (EXCLUDING BARE TRUSTEES) no. of Shares Held in the Company D direct indirect No. Name of Substantial Shareholder interest % # Interest % # 1. YBhg Tan Sri Rozali Bin Ismail 1,729, ,037, Central Plus (M) Sdn Bhd 30,679, ,038,900 * Corporate Line (M) Sdn Bhd 1,818, ,500,000 * Employees Provident Fund Board 34,448, ,020,000 ^ Utilico Emerging Markets Limited 28,112,450 ~ AmanahRaya Trustees Berhad 26,210, Amanah Saham Wawasan 2020 Notes: + Deemed interest by virtue of 100% equity interest each in Central Plus (M) Sdn Bhd and Corporate Line (M) Sdn Bhd of which 92.5% is held in own name and 7.5% is held in his children s names, respectively. * Held in various nominee name(s). ~ Held in nominee name(s). ^ Shares held and managed by Portfolio Managers. # Excluding a total of 2,036,800 PNHB Shares bought back and retained as treasury shares as at 27 April

180 List of Properties as at 31 december 2009 net Book remaining Description & date of land Value leasehold Existing Location acquisition area (RM) Tenure (Expiry Date) use Wisma Rozali 01/08/ ,952 sq.m 38,888, years 93 years office No. 4 & 6, Persiaran Sukan leasehold expiring on Premises Seksyen 13, Shah Alam 22/01/2102 Selangor Darul Ehsan Office Lots No. 8 Eu Tong Sen Street 03/10/ sq.m 99 years 90 years Office # 22-85, The Central leasehold expiring on Premises Singapore ,608,788 01/01/2100 No. 8 Eu Tong Sen Street 26/09/ sq.m 99 years 90 years Office # 22-86, The Central leasehold expiring on Premises Singapore /01/2100 Vacant Land H.S.(D) /02/ ,364 sq.m 7,667, years 90 years Rented out PT 32, Seksyen 14 leasehold expiring on to a car park Bandar Shah Alam 17/12/2099 operator District of Petaling Selangor Darul Ehsan Vacant Land H.S.(D) , PT /04/ sq.m H.S.(D) , PT /04/ sq.m 1,267,188 Freehold n/a none H.S.(D) , PT /04/ sq.m Mukim Pekan, Subang Jaya Daerah Petaling Selangor Darul Ehsan Vacant Land H.S.(D) 6163, PT /02/ ,438 sq.m 99 years 92 years none H.S.(D) 6164, PT ,092 sq.m leasehold expiring on H.S.(D) 6165, PT ,299 sq.m 55,869,820 24/10/2101 H.S.(D) 6166, PT ,733 sq.m Mukim Of Ijok District Of Kuala Selangor Selangor Darul Ehsan 4 Storey Shophouse No. 12, Jalan Todak 5 21/03/ sq.m 1,799, years 83 years office Pusat Bandar Seberang Jaya leasehold expiring on Premises Prai, Pulau Pinang 21/10/2092 Office Lot No. 20 Jalan Presiden UIF 01/02/2008 1,765 sq. ft. 1,789,500 Freehold n/a office Accentra Business Park premises Glenmarie, Shah Alam (Lot P.T. 547, H.S (D) District of Petaling Selangor Darul Ehsan) Vacant Land No. 8 Lorong Pandan 02/07/ ,154 sq. ft. 1,107,700 Freehold n/a none Off Jalan Mahmud Kuala Terengganu (Lot 2119, Mukim of Batu Buruk District of Kuala Terengganu Terengganu Darul Iman) 174

181 statement of directors responsibility for preparation of Financial statements The financial statements of the Group and Company have been drawn up in accordance with the applicable approved accounting standards in Malaysia and the provisions of the Companies Act, The Directors take responsibility in ensuring that the financial statements give a true and fair view of the financial position of the Group and of the Company as at 31 December 2009 and of the results and the cash flows of the Group and of the Company for the financial year then ended. In preparing the financial statements, the Directors have: Selected suitable accounting policies and applied them consistently; Made judgements and estimates that are reasonable and prudent; Ensured that all applicable accounting standards have been followed; and prepared financial statements on the going concern basis as the Directors have a reasonable expectation, having made appropriate enquiries, that the Group and the Company have adequate resources to continue in operational existence for the foreseeable future. The Directors have the responsibility for ensuring that the Company keeps accounting records, which discloses with reasonable accuracy, the financial position of the Group and Company and which enables them to ensure that the financial statements comply with the provisions of the Companies Act, The Board has the overall responsibility to take all steps as are reasonably open to them to safeguard the assets of the Group to prevent and detect frauds and other irregularities. 175

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