DIGITAL ECONOMY. Think, Collaborate and Transform the Business. Structure Software Service

Transcription

1

2 DIGITAL ECONOMY Think, Collaborate and Transform the Business Structure Software Service

3 Table of Contents 002 Corporate Information 021 Corporate Governance Statement 003 Our Solution 029 Other Information 004 Chairman s Statement 031 Financial Statements 006 Financial Highlights 130 Statistics of Shareholdings 008 Operations and Financial Review 132 Notice of Annual General Meeting 012 Board of Directors Enclosed Form of Proxy 018 Management Team

4 Corporate Information GOH PENG OOI Group Executive Chairman DR. KWONG YONG SIN Group Managing Director ONG KIAN MIN Independent Non-Executive Director YBHG. TAN SRI DATO DR. LIN SEE-YAN Independent Non-Executive Director LIM KOK MIN Independent Non-Executive Director YBHG. DATUK SULAIMAN BIN DAUD Non-Executive Director REGISTERED OFFICE SHARE REGISTRAR SHARE TRANSFER AGENT AUDITORS 002 Clarendon House 2 Church Street Hamilton HM 11 Bermuda Tel : Fax : CORPORATE OFFICE 26-01/ Cecil Street GB Building Singapore BEUDA Codan Services Limited Clarendon House 2 Church Street Hamilton HM 11 Bermuda SINGAPORE Boardroom Corporate & Advisory Services Pte Ltd 50 Raffles Place #32-01 Singapore Land Tower Singapore Tel : Fax : JOINT COMPANY SECRETARIES Ernst & Young Kuala Lumpur, Malaysia Chartered Accountants Audit Partner : Phang Oy Lin (with effect from financial year ended 30 June 2012) Tan Min-Li Hoong Lai Ling

5 our solution Silverlake Axis Integrated Banking Solution (SIBS) 003 SIBS is a complete solution that delivers business process and strategy on demand through information, operations and technology innovation. SIBS is designed on Silverlake s Group and Category Theoretic Architecture comprising the Core, Logistics and Representation Layers. This architecture enables our clients to respond rapidly and innovatively to their customers needs and markets demands in a cost effective manner.

6 CHAIAN S STATEMENT Dear Fellow Shareholders, On behalf of the Board of Directors, I am pleased to present to you the Annual Report of the Group for the financial year ended 30 June ANOTHER RECORD YEAR IN FY2013 Last year, the Group achieved a record financial performance both in terms of revenue and profitability. I am pleased to report again that on a mix of higher margin revenues, the Group s net profitability rose 21% to million in FY2013 to set another record. During the financial year, the Group continued to benefit from existing order books of software implementation services contracts as well as acquisitions of the Silverlake Solutions Group in FY2010 and Isis International Group in FY2011. The progressive execution of software implementation services contracts in FY2013 resulted in 89% growth in software licensing revenue to million. In addition, gradual repricing of existing maintenance contracts coupled with new maintenance contracts post software implementation contributed to 18% rise in the revenue of maintenance and enhancement services to million. The growth of these higher margin revenues lifted the Group s gross profit margin to 64% and net profit margin to 49% to establish the record profitability in FY2013. In FY2012, shareholders were rewarded for the record performance with a 65% increase in total dividend declared. For FY2013, shareholders are again rewarded for the Group s strong performance with total dividends rising by another 63% to Singapore 3.1 cents per share. The cash position of the Group remains strong, with cash and bank balances closing at million against total borrowings of 24.9 million as at 30 June 2013.

7 CHAIAN S STATEMENT (cont d) DIGITAL ECONOMY NEW OPPORTUNITIES In an increasingly borderless and digitised world, businesses are serving customers across boundaries and industries around the clock. To effectively and efficiently manage these increasingly demanding and complex customer interactions and transactions, software driven Information Technology ( IT ) capabilities are orchestrating human actions to spur the convergence into a Digital Economy. Such convergence provides the Group with new opportunities to deliver adaptive, scalable and resilient IT solutions to our customers to power their business transformations. Our recently acquired Isis International Group has been highly successful in empowering our customers with its enterprise payment solutions. We will continue to cross sell this payment technology to our customers across Asia. In the last 6 months, we have made two new acquisitions which will broaden our portfolio of software solutions and services to address the challenges of the Digital Economy. Merimen Group is a leading provider of value added enterprise solutions for the insurance industry in Asia and we expect this acquisition to significantly deepen our involvement within the insurance industry. Cyber Village specialises in internet and mobile platform technologies which underpin the e-commerce solutions they offer to customers across a broad range of industries. We will continue to evaluate suitable acquisition opportunities to enhance our Digital Economy capabilities. PROSPECTS In FY2013, 44% of the Group s revenue came from maintenance and enhancement services which are recurring. As we successfully execute the existing order book of software implementation services contracts in FY2014, this portion of Group s revenue should continue to grow. With over 100 customers across Asia, we expect to secure software implementation services contracts from our existing customer base in any given year and this adds to our recurrent revenue. In addition, our recent acquisitions and potential new customer wins will contribute to increasing our recurring revenue base. Although a modest economic recovery is taking place in the United States, there exist many challenges and uncertainties. I am also mindful of the economic austerity in much of Europe. However, fortunately for us, most of the Asian economies are still growing at a relatively healthy pace and we derive most of our businesses from customers operating in Asia. Notwithstanding the uncertainty in the global economy, the Group remains optimistic of its business prospects in FY2014 as it recognises new streams of income from the recent acquisitions. A WORD OF THANKS In another record year, on behalf of the Board of Directors, I would like to thank our management and staff for their contributions and team work. I look forward to their dedication as we further enhance our capabilities to address the challenges in the market place. I would also like to thank all our customers, shareholders, bankers and business associates for their support and confidence in us. As always, my sincere gratitude to my fellow directors for their counsel and support. Goh Peng Ooi Group Executive Chairman 27 September

8 Financial Highlights Revenue { million } Gross Profit { million } Profit Before Tax { million } Net Profit { million } Restated Financial Year Ended 30 June Financial Results ( million) Revenue Gross Profit EBITDA Profit Before Tax Net Profit Financial Positions ( million) Share Capital Shareholders Fund Total Assets Financial Ratio Gross Profit Margin (%) 61% 63% 60% 54% 64% Net Profit Margin (%) 47% 36% 38% 41% 49% Return on Equity (%) 50% 39% 54% 55% 33% Current Assets / Current Liabilities (Times) Per Share ( sen) Basic Earnings Per Share Net Assets Per Share Dividends (SGD cents) Dividends Per Share

9 Financial Highlights (cont d) % % 63% 64% 60% 54% % 80% 70% 60% 50% 40% 30% 20% 10% 0% % % % 80% % 80% % 36% 38% 41% 70% % 60% 50% % 40% % 54% 55% 33% 70% 60% 50% 40% % 20% 10% 0% % 20% 10% 0%

10 Operations and Financial Review Group s profit attributable to shareholders increased 21% to million. Our return on equity in FY2013 stood at 33%. FINANCIAL PERFOANCE REVIEW OVERVIEW In FY2013, the Group remained in the exciting and dynamic growth phase of empowering the digital economy. Despite a challenging business environment clouded by global economic uncertainties, Asian financial institutions and corporations continued to invest in technology to improve their competitive edge. This is evident in our steady growth driven by new software license and software implementation services contracts secured during the financial year. 008 Although the Group recorded a marginal decrease in revenue to million, profit attributable to shareholders rose 21% to million. This marks the third consecutive year the Group achieved growth in profitability. Our return on equity in FY2013 was a strong 33%. Since FY2010, the Group successfully executed several acquisitions to broaden our suite of business enterprise software solutions and services offerings, which in turn contributed to the steady growth over the past 3 years. In FY2013, we completed the acquisition of Merimen Ventures Sdn. Bhd. ( Merimen Group ), a provider of Software as a Service (SaaS) platform for insurance companies. The acquisition extends the software and service capabilities, increases the recurring income base and expands the application software intellectual property portfolio of the Group to the insurance industry in the region. REVENUE FY2013 revenue decreased marginally to million mainly due to lower contribution from software project services and sale of software and hardware products. The decrease was partially offset by higher contributions from software licensing and maintenance and enhancement services as well as new contribution from insurance processing generated by the Merimen Group. The sale of software and hardware products was substantially lower in FY2013 compared with FY2012 which recorded two large sales of hardware products. Software project services also recorded lower revenue as significant revenue was recognised in the previous year following the successful completion of Thanachart-Siam City Bank and Hong Leong-EON Bank merger integration projects as well as CIMB Thailand and CIMB Singapore SIBS core banking projects. Preliminary work has started on the recently secured software implementation service contracts and some revenue from these contracts was recognised in FY2013. As work on new and existing software implementation services contracts continues, revenue will be progressively recognised in the current and subsequent financial year. Revenue from software licensing increased to million as there were several major software licensing contracts secured and delivered during FY2013. Maintenance and enhancement services revenue recorded strong growth with new maintenance and enhancement contracts secured following the completion of software implementation contracts. The Group also recognised revenue from insurance processing contributed by Merimen Group after completion of the acquisition in April 2013.

11 OPERATIONS AND FINANCIAL REVIEW (cont d) FY2013 Revenue 398.6m FY2013 Gross Profit 253.9m PROFITABILITY Gross profit rose 17% to million in FY2013 despite the marginal decrease in revenue. Gross profit margin improved to 64% on the back of increased revenue from higher margin activities such as software licensing and maintenance and enhancement services. FY2013 Net Profit 196.0m As for operating expenses, selling and distribution costs increased with higher expenses incurred to support expanded marketing activities and consolidation of marketing expenses of Merimen Group. Administrative expenses rose due to a charge of 1.6 million on share awards granted pursuant to Silverlake Axis Ltd Performance Share Plan ( PSP ) and consolidation of Merimen Group expenses. In addition, the Group s share of profit of associates increased with higher contributions from Global InfoTech Co. Ltd. Although profitability was higher, the effective tax rate of the Group declined due to lower taxable income. Overall, net profit of the Group rose 21% to million with a corresponding improvement in net profit margin to 49%. 009 FINANCIAL POSITION The Group s cash and bank balances improved significantly to million boosted by strong cash flows from operating activities of million. Financing activities contributed proceeds of million from issuance of 100 million new ordinary shares and sale of 45 million treasury shares. After payment of dividends and acquisition of Merimen Group, the Group still recorded net increase in cash and cash equivalents of million. Following the completion of acquisition of Merimen Group, fair values of identifiable assets and goodwill related to the acquisition lifted the Group s non-current assets to million. Total non-current liabilities were higher due to the remaining purchase consideration payable in tranches for the acquisition. As of 30 June 2013, the Group s statement of financial position remained strong with minimal borrowings and a comfortable net cash position.

12 OPERATIONS AND FINANCIAL REVIEW (cont d) OPERATIONS REVIEW The Group is a leading provider of digital economy solutions and services for major organisations in Banking and Financial Services, Payments, Retail and Logistics businesses. The Group s Silverlake Axis Software and Services Solutions deliver operational excellence and enable business transformations at over 100 organisations across Asia, including 40% of the top 20 largest banks in South East Asia. In FY2013, our business expanded to include insurance processing. The Group s sources of revenue, in the order of their percentage contribution to total revenue in FY2013, are (i) Maintenance and Enhancement Services, (ii) Software Licensing, (iii) Software Project Services, (iv) Credit Card Processing, (v) Sale of Software and Hardware Products and (vi) Insurance Processing. Revenue by business activities 17.2m (4%) 33.3m (8%) 6.6m (2%) 16.7m (4%) 4.7m (1%) 147.2m (37%) 77.4m (19%) 173.6m (44%) 139.0m (35%) FY 2012 FY m (16%) 119.6m (30%) Maintenance and Enhancement Services Software Project Services Sale of Software and Hardware Products Software Licensing Credit Card Processing Insurance Processing MAINTENANCE AND ENHANCEMENT SERVICES Since the acquisition and successful integration of Silverlake Solutions Group in FY2010, maintenance and enhancement services remain the key revenue contributor and provide the Group with a stable and steadily growing recurrent revenue stream. In FY2013, the Group secured new maintenance contracts and renewed existing contracts. During the financial year, maintenance and enhancement services revenue increased 18% to million and accounted for 44% of total revenue. The improved revenue was attributed to new maintenance contracts and several major enhancement contracts secured from existing customers in Malaysia, Singapore, Thailand and Philippines. Demand for the Group s maintenance services increased as customers recognise the benefits of having a stable system managed by the strong support team from Silverlake. In addition, some banking customers also sought to enhance existing systems so as to provide better and more convenient services to their customers. Geographically, revenue from Singapore increased due to requirements for G3 Giro Transformation and chips based ATM cards. In addition, the implementation of SIBS Core Banking System by a customer for worldwide operations also contributed significantly to the Group s revenue. In Thailand, higher revenue was driven by launches of new consumer products by a customer experiencing significant expansion in consumer banking business. In Philippines, one of the top 20 largest banks in the country engaged the Group s service to enhance its existing system so as to improve work processes and meet compliance requirements.

13 OPERATIONS AND FINANCIAL REVIEW (cont d) SOFTWARE LICENSING Revenue from the Group s second largest contributor, software licensing, increased by 89% to million and accounted for 30% of total revenue. New contract wins in Malaysia, Thailand and Africa contributed to the strong growth in software licensing. The strong performance of software licensing is a result of continuous efforts by the research and development team to improve our award winning Silverlake Axis Integrated Banking Solution ( SIBS ) which delivers innovative solutions to help our customers address challenges as well as capitalise on opportunities in the market place. SOFTWARE PROJECT SERVICES Revenue from software project services declined 44% to 77.4 million in FY2013. The decline was attributable to the substantial revenue recognised in FY2012 following the successful completion of major software implementation contracts secured in FY2010 and FY2011, such as the Thanachart-Siam City Bank and Hong Leong-EON Bank merger integration projects and CIMB Thailand and CIMB Singapore SIBS core banking projects. During the financial year, the Group secured a new SIBS software implementation service contract from Union Bank of Colombo PLC in Sri Lanka. This is our second Sri Lankan banking customer. Other newly secured implementation services contracts include Silverlake Axis Integrated Islamic Banking System ( SIIBS ) for an Islamic bank in Malaysia, Silverlake Axis Integrated Provident Fund System ( SIPFS ) project in Ghana, Africa and Enterprise Payment Platform ( EPP ) Solution project for Hong Leong Bank Bhd. Initial work has commenced on existing as well as new software implementation service contracts and some revenue was recognised in FY2013. As work on these contracts continues, revenue will be progressively recognised in the current and subsequent financial year. CREDIT CARD PROCESSING 011 The Group s credit card processing operation is derived from Silverlake Japan Ltd, a wholly-owned subsidiary in Japan. Silverlake Japan Ltd provides outsource full scale processing of credit cards issued by its customers. For the financial year in review, revenue increased marginally from JPY432 million to JPY456 million, in line with customer s business growth. However, this increase was offset by the weakening of the Japanese Yen against Malaysia Ringgit, which resulted in a lower credit card processing revenue of 16.7 million after foreign exchange translation. SALE OF SOFTWARE AND HARDWARE PRODUCTS Sale of software and hardware products is secondary and symbiotic to software implementation services contracts. In FY2012, the Group recorded two large sales of hardware products related to software implementation services contracts with two banks in Malaysia. As such sales did not recur, revenue from sale of software and hardware products declined 80% to 6.6 million in FY2013. During the financial year, software and hardware products were delivered to a new Islamic banking customer. INSURANCE PROCESSING Insurance processing is a new source of revenue for the Group following the acquisition of Merimen Group in the fourth quarter of the financial year. Merimen Group provides a cloud computing Software as a Service (SaaS) platform for insurance companies to interact and transact with their customers and partner communities to effectively and efficiently process and administer policy origination and claims processing. Merimen Group contributed revenue of 4.7 million to the Group in FY2013.

14 BOARD OF DIRECTORS 012 Mr. Goh Peng Ooi was appointed as the Group Executive Chairman of Silverlake Axis Ltd ( the Company ) on 23 May Prior to that, he was the Non-Executive Chairman of the Company since He founded Silverlake Group in 1989 and has built it to become an established provider of an advanced, state of the art universal integrated banking solution. Silverlake Group has grown by leaps and bounds and at present, its offices and customers are located in over 13 countries across Asia Pacific. Silverlake Group has earned many industry recognitions including the IBM Star Stream Award in 1997, the IBM iseries Director s Award for the Best Global On-Demand Banking Implementation in 2003, IBM s Asia Pacific Excellence Award for Regional System Integrators (SIs) and Independent Software Vendors (ISVs) in 2005, IBM iseries General Manager s Award in 2005 and IBM Partner World Beacon Awards in 2005 and Mr. Goh was bestowed the Technology Entrepreneur Award Malaysia This Entrepreneur Award Program, organised by Ernst & Young, serves to recognise worldclass entrepreneurs and provides a benchmark for entrepreneurial excellence. Prior to Silverlake Group s formation, Mr. Goh had worked with IBM Malaysia. He held several senior positions over his 9 years career at IBM, his last being Marketing Manager for Banking and Finance Industry. Mr. Goh has a keen interest in Science and Mathematics and obtained his Bachelor of Engineering (Major in Electronics) at the University of Tokyo on a Mombusho Scholarship in GOH PENG OOI Group Executive Chairman Appointed on 23 August 2002, re-elected on 18 October 2011 Member of Nominating Committee

15 BOARD OF DIRECTORS (cont d) Dr. Kwong Yong Sin was appointed as the Group Managing Director in He was previously a Non-Executive Director of the Company and the Managing Director of Silverlake Corporation from 2003 to 2005 and Connectif Commerce Sdn Bhd from 2001 to Prior to joining Silverlake Corporation, he was a Partner/Vice President of Ernst & Young Global Consulting and Cap Gemini Ernst & Young for 11 years from 1989 to He was the Senior Manager and Head of IT Consulting for Coopers & Lybrand (South East Asia) from 1984 to Prior to that, he was Senior Systems Analyst for Pacific Power (Australia) from 1979 to He has more than 30 years of experience in Information Technology, Business Transformation and Solution Implementation in Financial Services, Utilities and Technology Industries. He has a Bachelor of Commerce (Honours) from the University of New South Wales (Australia) and Ph.D in Information Systems. He is a Certified Practicing Accountant Australia. DR. KWONG YONG SIN Group Managing Director Appointed on 20 August

16 BOARD OF DIRECTORS (cont d) 014 Mr. Ong Kian Min was first appointed a Director in In addition to practicing as a consultant with Drew & Napier LLC, a Singapore law firm, Mr. Ong is a senior advisor with Alpha Advisory Pte. Ltd. (an independent financial and corporate advisory firm) and CEO of Kanesaka Sushi Private Limited which owns and operates Japanese fine-dining restaurants. He was called to the Bar of England and Wales in 1988, and to the Singapore Bar the following year. In his more than 20 years of legal practice, he focused on corporate and commercial law, such as, mergers and acquisitions, joint ventures, IPOs and corporate finance. Currently, he is also non-executive chairman of Hupsteel Ltd and independent non-executive director of BreadTalk Group Limited, China Energy Limited, Food Empire Holdings Limited, GMG Global Ltd, Jaya Holdings Limited, LANKom Electronics Limited and Penguin International Ltd. He was awarded the President s Scholarship and Singapore Police Force Scholarship in 1979, and holds a Bachelor of Laws (Honours) external degree from the University of London and a Bachelor of Science (Honours) degree from the Imperial College of Science & Technology in England. Mr. Ong was an elected Member of the Singapore Parliament from 1997 to ONG KIAN MIN Independent Non-Executive Director Appointed on 9 January 2003, re-elected on 29 October 2012 Chairman of Audit Committee, Chairman of Nominating Committee and Member of Remuneration Committee

17 BOARD OF DIRECTORS (cont d) Tan Sri Dato Dr. Lin See-Yan was appointed a Director in Tan Sri is currently an independent strategic and financial consultant. Prior to 1998, he was Chairman and Chief Executive Officer of the Pacific Bank Group and for 14 years previously, Deputy Governor of Bank Negara Malaysia (Central Bank of Malaysia). Tan Sri is currently a member of the Prime Minister s Economic Council Working Group and Governor of the Asian Institute of Management in Manila as well as Director of Monash University Malaysia Sdn Bhd. Tan Sri sits on the Boards of Ancom Berhad, Genting Berhad, Wah Seong Corporation Berhad, IGB REIT Management Sdn Bhd, JobStreet Corporation Berhad, Top Glove Corporation Berhad and a number of private companies in Malaysia, Singapore and Indonesia. He is Chairman Emeritus of Harvard University s Graduate School Alumni Association Council in Cambridge (USA) and President of the Harvard Club of Malaysia. He is also Professor of Economics (Adjunct) at Universiti Utara Malaysia and Professor (Adjunct) of Business & International Finance at Universiti Malaysia Sabah. Tan Sri is a British Chartered Scientist and a UK Chartered Statistician. He holds 3 post-graduate degrees from Harvard University (including a Ph.D in Economics) where he was a Mason Fellow and Ford Scholar. Tan Sri is an Eisenhower Fellow and Fellow of the IMF Institute in Washington D.C., the Royal Statistical Society in London, the Institute of Bankers Malaysia, the Malaysia Insurance Institute, the Malaysian Institute of Management, and the Malaysia Economic Association. He is also a Distinguished Fellow of the Institute of Strategic and International Studies in Malaysia. YBHG. TAN SRI DATO DR. LIN SEE-YAN Independent Non-Executive Director Appointed on 9 January 2003, re-elected on 28 October 2010 Chairman of Remuneration Committee, Member of Audit Committee and Member of Nominating Committee 015

18 BOARD OF DIRECTORS (cont d) 016 Mr. Lim Kok Min was appointed a Director in 2006 and is currently the Chairman of Gas Supply Pte Limited. He is the immediate past Chairman of the Singapore Institute of Directors, Building and Construction Authority and Senoko Power Limited. He was the Executive Deputy Chairman of LMA International NV until end of December 2010, Deputy Chairman of NTUC FairPrice Cooperative until end of September 2011 and Vice Chairman of the Singapore Institute of Management until May He was previously Managing Director of Pan-United Corporation Limited, JC-MPH Ltd and Chief Executive Officer of Cold Storage Holding Limited. He now sits on the boards and Audit, Remuneration and Nominating Committees of Boustead Singapore Ltd and a number of non-listed companies. He was also a former member of the Securities Industry Council and the Corporate Governance Council, and a former director/council Member of both the Singapore International Chamber of Commerce and the Singapore Confederation of Industries. He is currently Chairman of the OECD Asian Network on Corporate Governance for State Owned Enterprises and a member of the Singapore Companies Act Review Committee. An Economics Honours graduate from the University of Malaya, Mr. Lim has more than 45 years of extensive senior management and over 30 years of board experience in the Asia-Pacific region. LIM KOK MIN Independent Non-Executive Director Appointed on 15 June 2006, re-elected on 29 October 2012 Member of Audit Committee, Member of Remuneration Committee and Member of Nominating Committee

19 BOARD OF DIRECTORS (cont d) Datuk Sulaiman bin Daud was appointed a Director in Datuk started his career with Malaysian Tobacco Company Berhad (now British American Tobacco Company Berhad) in 1968 and was the Deputy Chief Executive/Executive Director when he left in He was a Director of the Agricultural Bank of Malaysia for 2 years and later became the Chairman for the bank for 8 years. Under his stewardship, the Bank was transformed into a corporatised entity, today known as AGRO Bank. He was the Chairman of Ranhill Power Berhad, Director of Pharmaniaga Berhad and Malaysia Nasional Insurance Berhad. He is presently the Chairman, member of Audit Committee and Chairman of Nomination Committee of Malaysia Packaging Industry Berhad. He is a Director, Chairman of Audit Committee as well as Chairman of Nomination and Remuneration Committee of Konsortium Transnasional Berhad. He is a director, Chairman of Audit Committee and member of Nomination and ESOS Committee of Tadmax Resources Berhad. He has served on the board of Universiti Putra Malaysia. He is also Chairman and Director of a number of private companies in Malaysia and abroad in various industries. He now spends a considerable part of his time seeking and developing business prospects in Asean and in the Middle East. He has a Diploma in Agriculture from Universiti Putra Malaysia and Master of Business Administration from IMC Buckingham, United Kingdom. He is also an Advanced Management Graduate of Stanford-Insead in Fontainebleau, France. YBHG. DATUK SULAIMAN BIN DAUD Non-Executive Director Appointed on 9 January 2003, re-elected on 18 October 2011 Member of Nominating Committee 017

20 MANAGEMENT TEAM 018 SEATED (L - R): DR. KWONG YONG SIN Group Managing Director GOH PENG OOI Group Executive Chairman STANDING (L - R): Yau Siew Moi, Lau Siow Ling, Hidetoshi Neda, Lee Cheen Siong, Trevor Lok Theng Hey, Andrew Ooi Su Jin, Sanjeev Dhar, Wong Yok Koon, Hoong Lai Ling

21 MANAGEMENT TEAM (cont d) LAU SIOW LING Senior EVP, Structured Services Management and Operations Ms. Lau joined the Group in She holds a degree in Computer Science from the University of Louisiana. She has 27 years of working experience in the IT industry, particularly in the areas of sales and marketing. She joined IBM Malaysia in 1985 and gained in-depth knowledge relating to the installation of IBM iseries and SIBS. In 2001, she joined Silverlake as Vice-President. WONG YOK KOON Senior EVP, SIBS Core and Integration Product Development & Solutions Ms. Wong is responsible for the integration development of Silverlake Axis Integrated Banking Solution (SIBS). Prior to joining the Group in 2006, she was a Senior Executive Vice President with Silverlake System Sdn Bhd with responsibilities in the design and development of new solutions. Ms. Wong has over 20 years of experience in the banking software industry. YAU SIEW MOI Senior EVP, SIBS Core Product Development & Solutions Ms. Yau joined the Group in 2006 and is responsible for the product development of SIBS. She was previously the Executive Vice President with Silverlake System Sdn Bhd. During her 22 years in the banking software industry, Ms. Yau has developed universal lending products which have been successfully implemented in banks across Asia Pacific and the Middle East. SANJEEV DHAR Senior EVP, Digital Economy and Payment Solutions TREVOR LOK THENG HEY Chief Executive Officer of Merimen Group Since joining the Group in 2011, Mr. Dhar is responsible for enterprise payment and integration technology platform business represented by the flagship VCOS & EPOne Solutions. He is also responsible for managing Isis Group s day-to-day operations regionally, as well as leading the Company s product development and technology strategy in the enterprise integration and payments space. Prior to joining the Group, he was Senior Vice President at Isis since 1996 where he spearheaded all product development. He has over 18 years of experience in banking technologies, financial systems and digital banking infrastructure. He holds a Bachelor s degree in Computer Technology from the University of Poona, Pune India. Mr. Lok joined Merimen Group as one of its pioneer employees in year 2002 and played an instrumental role in its early success. He is currently responsible for the overall strategy and operations of Merimen s business. He is leading Merimen s business development and expansion from Malaysia and Singapore to the rest of the Asia Pacific region. He holds the highest Honors Degrees in Mathematics and Physics from University of Texas at Austin, USA and was a research fellow at Princeton University for theoretical and computational models in plasma physics. Before assuming his current role, Mr. Lok actively led the development of Merimen s insurance policy solutions. He has over 10 years of experience in insurance solutions and services industry. 019

22 MANAGEMENT TEAM (cont d) ANDREW OOI SU JIN Chief Technology Officer of Merimen Group HOONG LAI LING Senior EVP, Administration and Finance 020 Mr. Ooi joined Merimen Group in year 2000 and is responsible for the technical framework that all Merimen solutions are built upon. He designed the architecture that created solid and robust products that are capable of rapid enhancement and evolution while handling very high transactional volumes. He holds a Bachelors Degree in Computing from Cambridge University, UK. Before assuming the current role, Mr. Ooi worked in the insurance IT industry as a Software Engineer in Sunway Workflow Automation (SWA), and was involved in the design and development of insurance automation systems. He has over 14 years of experience in insurance claim solution and services industry. Ms. Hoong joined the Group in 2002 and is responsible for overseeing the Group s financial, accounting and administrative functions. She is a qualified accountant from the Malaysian Institute of Certified Public Accountants. She was previously an accountant with Silverlake System Sdn Bhd and trained in PricewaterhouseCoopers Malaysia. HIDETOSHI NEDA Managing Director of Silverlake Japan Limited Mr. Neda joined the Group in He is responsible for the development of the Japanese credit card processing market. He is also responsible for the research and development of Process Re-engineering & Quality Control for the Group. In his 22 years experience in the Credit Card and Retail Banking industries, Mr. Neda played a lead role in the Japan credit card market by developing new credit card products, payment products and services. These business products were successfully implemented in MasterCard, Citibank N.A., Shinsei Bank, Tokyo Star Bank and SBI Group. LEE CHEEN SIONG EVP, SIBS Channel Product Development & Solutions Mr. Lee joined the Group since 2000 and has been focusing and implementing the Branch Delivery and channels in the region. He was appointed as EVP in June Prior to the current role, he was the country manager for Silverlake Axis in Beijing, China. He graduated from Tunku Abdul Rahman College with a Bachelor of Science Degree in Information Systems from Campbell University, USA. Mr. Lee has 18 years of experience in the banking software industry.

23 CORPORATE GOVERNANCE STATEMENT The Board of Directors of Silverlake Axis Ltd (the Board ) recognises the importance of good corporate governance in ensuring greater transparency, protecting the interests of its shareholders as well as strengthening investors confidence in its management and financial reporting and is committed to maintaining a high standard of corporate governance within the Group in line with the Code of Corporate Governance issued by the Corporate Governance Council. The Board adopts practices based on the Code of Corporate Governance 2005 (the Code ) and the amendments to the Mainboard Listing Rules ( Listing Rules ) which came into effect on 29 September 2011 as announced by the Singapore Exchange Limited Securities Trading ( SGX-ST ) to strengthen corporate governance practices and foster greater corporate disclosure, where it is applicable and practical to the Group. The Board has also reviewed the revised Corporate Governance Code 2012 and will be taking steps to comply with such recommendations as appropriate. The main corporate governance practices that were in place during the financial year ended 30 June 2013 are set out below: BOARD MATTERS Principle 1: The Board s Conduct of Affairs Every company should be headed by an effective Board to lead and control the company. The Board is collectively responsible for the success of the company. The Board works with Management to achieve this and the Management remains accountable to the Board. The Board holds meetings on a regular basis throughout the year to review the Group s performance and approve the Group s key strategic plans, as well as major investments and disposals, declarations of dividends, appointment of new Directors and funding decisions. The Board is also responsible for the overall corporate governance of the Group. 021 The Board held 4 scheduled meetings during the last financial year. Board meetings are normally held in Singapore. Additional ad-hoc meetings are also held when required. The attendance of Directors at the scheduled Board and Committees meetings and the frequency of such meetings are as follows: Attendance at Meetings Board of Audit Remuneration Nominating Directors Committee Committee Committee Name No. of No. of No. of No. of No. of No. of No. of No. of meetings meetings meetings meetings meetings meetings meetings meetings held attended held attended held attended held attended Goh Peng Ooi Dr. Kwong Yong Sin Ong Kian Min YBhg. Tan Sri Dato Dr. Lin See-Yan Lim Kok Min YBhg. Datuk Sulaiman bin Daud All Directors are updated regularly on the changes in Company policies, board process, corporate governance and best practices in compliance with the relevant legislation and regulations including the Listing Manual of the SGX-ST.

24 CORPORATE GOVERNANCE STATEMENT (cont d) Principle 2: Board Composition and Guidance There should be a strong and independent element on the Board, which is able to exercise objective judgement on corporate affairs independently, in particular, from Management. No individual or small group of individuals should be allowed to dominate the Board s decision making. The Board currently comprises six members, of which two are Executive Directors, one Non-Executive Director and three Independent Non-Executive Directors. Key information regarding the Directors can be found under the Board of Directors profile section of this annual report. The independence of each Independent Director is reviewed by the Nominating Committee ( NC ) annually and also upon notification by an Independent Director of a change in circumstances based on the criteria for independence as defined in the Code. The current Board, with Independent Directors making up half of the Board, complies with the Code s requirement that at least onethird of the Board should be made up of Independent Directors. Certain functions have been delegated to various Board Committees, in particular, the Audit Committee ( AC ), Nominating Committee ( NC ) and Remuneration Committee ( RC ), all of which are chaired by an Independent Director. The NC is of the view that the Board has a strong independent element ensuring objectivity in the exercise of judgement on corporate affairs independently from Management. The NC is also of the view that no individual or small group of individuals dominates the Board s decision making process. The Board is of the view that taking into account the nature and scope of the Company s operations, the current board size of six Directors is appropriate. 022 The Board considers that its current Directors represent a mix of industry knowledge, business network and extensive business and management experience. This balance is important in ensuring that the strategies proposed by Management are objectively reviewed and discussed, taking into account the long term interests of the Group. To-date, none of the Independent Directors of the Company has been appointed as a Director of the Company s principal subsidiaries. The Board is of the view that the current Board structures in the principal subsidiaries are well organised and constituted. The Board and the Management will from time to time review the Board structures of the principal subsidiaries and will make appropriate changes when needed, including the appointment of Independent Directors to the board of such principal subsidiaries. Principle 3: Role of Chairman and Managing Director There should be a clear division of responsibilities at the top of the company the working of the Board and the executive responsibility of the company s business which will ensure a balance of power and authority, such that no one individual represents a considerable concentration of power. Mr. Goh Peng Ooi is the Group s Executive Chairman and Dr. Kwong Yong Sin is the Group s Managing Director, responsible for the day-today management of the Company. The Board believes that a division of responsibility between the Chairman and the Managing Director is appropriate for the Company. The Chairman assumes responsibility for the management of the Board while the Managing Director takes responsibility for the implementation of board decisions and for all operational matters in the Group. The Chairman ensures Board meetings are held regularly and are conducted efficiently. The Chairman, in discussion with the Managing Director, approves the agenda and both review Board papers before they are presented to the Board and ensure that the Board members are provided with complete, accurate and timely information. Mr. Goh and Dr. Kwong are not related. The Board is of the view that the separation of the role of the Chairman and that of the Managing Director and the chairing of the AC, NC and RC by Independent Directors ensures sufficient balance of power and authority in the Board. The Board is therefore of the view that, although the Chairman and the Managing Director are both part of management, it is not necessary at present to appoint a lead independent director as the independent directors, who form half the Board, are able to ensure objectivity and independence in the Board s deliberations and decisions.

25 CORPORATE GOVERNANCE STATEMENT (cont d) Principle 4: Board Membership There should be a formal and transparent process for the appointment of new directors to the Board. The Company believes that board renewal should be an ongoing process to ensure the Board collectively has the required skills, diversity and experience to meet the changing needs of the Company and its businesses. The Company s Bye-Laws require one-third of Directors (excluding the Managing Director) to retire and be subjected to re-election by the shareholders at every Annual General Meeting ( AGM ). Accordingly, no Director shall stay in office for more than 3 years without being re-elected by the shareholders except for the Managing Director who is not required to submit himself for retirement and re-election. The NC has recommended that, taking into consideration their commitment and performance, the Directors retiring by rotation under the Bye-Laws at the forthcoming AGM be nominated for re-election. The Board has accepted the recommendation. The NC currently comprises Mr. Ong Kian Min, Mr. Goh Peng Ooi, YBhg. Datuk Sulaiman bin Daud, YBhg. Tan Sri Dato Dr. Lin See-Yan and Mr. Lim Kok Min, with Mr. Ong Kian Min as the Chairman. Mr. Ong Kian Min, YBhg. Tan Sri Dato Dr. Lin See-Yan and Mr. Lim Kok Min are Independent Directors. The responsibilities of the NC are to (i) review the nomination for appointments and re-appointments of members of the Board and the various Board Committees for the purpose of proposing such nomination to the Board for approval having regard to the individual s experience, contributions and performance, (ii) determine annually whether or not a Director is independent, (iii) assess on whether or not a Director is able to and has been adequately carrying out his duties as a Director, and (iv) oversee the appointment and induction process of new Directors. New directors are normally appointed by way of a Board Resolution, after the NC has approved their nomination. The NC will consider the Company s current Board in term of its size, composition, collective skills and experience and diversity. Potential candidates are selected through internal resources, referrals from existing Directors and/or external search. Candidates should possess relevant experience and have the calibre to contribute to the Group and its businesses, and will complement the skills and competencies and attributes of the existing Board and the requirements of the Group. The candidate must be a person of integrity and must be able to commit sufficient time and attention to the affairs of the Company, especially if he is serving on multiple Boards. 023 Principle 5: Board Performance There should be a formal assessment of the effectiveness of the Board as a whole and the contribution by each director to the effectiveness of the Board. A formal self-assessment of the effectiveness of the Board as a whole and the contribution by each director to the effectiveness of the Board is undertaken by the NC annually based on relevant performance criteria approved by the Board, such as contributions at Board meetings and discussions, strategic thinking, exercise of judgement, time commitment and board dynamics. The Board s performance is also reviewed informally by the NC, with inputs from the other Board members and the Managing Director. Principle 6: Access to Information In order to fulfill their responsibilities, Board members should be provided with complete, adequate and timely information prior to board meetings and on an on-going basis. In order to ensure that the Board is able to fulfill its responsibilities, Management is required to provide complete and adequate information to the Board in a timely manner on affairs and issues that require the Board s decision as well as ongoing reports relating to the operational and financial performance of the Company and the Group. The Board has separate and independent access to the Senior Management and the Company Secretary at all times. Should Directors, whether as a group or individually, need independent professional advice, a professional advisor will be appointed upon direction by the Board and approved by the Managing Director, to render the advice. The cost of such professional advice will be borne by the Company.

26 CORPORATE GOVERNANCE STATEMENT (cont d) The Company Secretary attends all Board and Board Committees meetings and is responsible for the compliance of board procedures and all rules and regulations that are applicable to the Company. REMUNERATION MATTERS Principle 7: Procedures for Developing Remuneration Policies There should be a formal and transparent procedure for developing policy on executive remuneration and for fixing the remuneration packages of individual directors. No director should be involved in deciding his own remuneration. Principle 8: Level and Mix of Remuneration The level of remuneration should be appropriate to attract, retain and motivate the directors needed to run the company successfully but companies should avoid paying more than is necessary for this purpose. A significant proportion of executive directors remuneration should be structured so as to link rewards to corporate and individual performance. Principle 9: Disclosure on Remuneration Each company should provide clear disclosure of its remuneration policy, level and mix of remuneration and the procedure for setting remuneration in the company s annual report. It should provide disclosure in relation to its remuneration policies to enable investors to understand the link between remuneration paid to directors and key executives, and performance. 024 The RC was established to review the remuneration of the Executive Directors and key executives of the Company and to provide a greater degree of objectivity and transparency in determining the remuneration of the Executive Directors and key executives. The RC is currently chaired by YBhg. Tan Sri Dato Dr. Lin See-Yan and comprises Mr. Ong Kian Min and Mr. Lim Kok Min as members. All three are Independent Non-Executive Directors. The RC reviews and recommends to the Board a framework of remuneration for the Directors and key executives, and determines specific remuneration packages for the Chairman and the Managing Director. The recommendations of the RC are submitted for endorsement by the entire Board. All aspects of remuneration, including but not limited to Directors fees, salaries, allowances, bonuses, options and benefits-in-kind are covered by the RC. The RC has access to expert professional advice on human resource matters whenever there is a need to consult externally. In its deliberations, the RC will take into consideration industry practices and norms in compensation in addition to the Company s relative performance to the industry and performance of the individual Directors. No Director will be involved in deciding his own remuneration. The Executive Directors have entered into service agreements with the Company. The service agreement covers the terms of employment, specifically salary and other benefits. The remuneration of Non-Executive Directors is determined by their contribution to the Company and their responsibilities on the Board. The Board will recommend the remuneration of the Non-Executive Directors for shareholders approval at the AGM. Directors Remuneration The Executive Directors remuneration consists of their salary, performance shares allowances and benefits-in-kind. All Directors fees are subject to the approval of the shareholders at the AGM. The basis of allocation of the number of share options to the Directors takes into account the Directors contributions and his additional responsibilities at Board Committees. During the financial year, no share options were granted to any of the Directors.