TA Enterprise Berhad (194867-M) Annual Report 2011 Fostering Aspirations and Dreams 1
MALAYSIA Peninsular Malaysia Central Region TA ENTERPRISE BERHAD 34 th Floor, Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia. Tel: 603-2072 1277 Fax: 603-2031 6608 TA INVESTMENT MANAGEMENT BERHAD 23 rd Floor, Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia. www.tainvest.com.my Tel: 603-2031 6603 Fax: 603-2031 4479 TA SECURITIES HOLDINGS BERHAD Principal Office 34 th Floor, Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia. www.tasecurities.com.my Tel: 603-2072 1277 Fax: 603-2031 6608 SUBANG JAYA BRANCH 2-1, 2-2, 2-3, & 4-2, Jalan USJ 9/5T Subang Business Centre 47620 UEP Subang Jaya Selangor Darul Ehsan Malaysia. TA FUTURES SDN. BHD. nd 32 Floor, Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia. www.tafutures.com.my Tel: 603-2072 4831 Fax: 603-2072 5001 TA CAPITAL SDN. BHD. 14 th Floor, Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia. Tel: 603-8025 1880 Fax: 603-8023 8820 DAMANSARA UTAMA BRANCH 2 ndfloor, Wisma TA No. 1A, Jalan SS 20/1 Damansara Utama 47400 Petaling Jaya Selangor Darul Ehsan Malaysia. Tel: 603-7729 5713 Fax: 603-7725 5762 Tel: 603-2072 1277 Fax: 603-2026 8417 1
Northern Region IPOH BRANCH st 1 Floor, Plaza Teh Teng Seng 227 Jalan Raja Permaisuri Bainun 30250 Ipoh, Perak Darul Ridzuan Malaysia. Tel: 605-253 1313 Fax: 605-253 6373 KOTA BHARU BRANCH 298, Jalan Tok Hakim 15000 Kota Bharu Kelantan Darul Naim Malaysia. Tel: 609-743 2288 Fax: 609-748 5366 East Malaysia SIBU BRANCH 12G, Jalan Kampung Datu 96000 Sibu, Sarawak Malaysia. Tel: 084-319 998 Fax: 084-313 193 KUCHING BRANCH nd 2 Floor, Bangunan Binamas Lot 138, Section 54, Jalan Padungan 93100 Kuching, Sarawak Malaysia. Tel: 082-236 333 Fax: 082-236 222 HONG KONG TA SECURITIES (HK) LIMITED Room 1203, 12/F Tower One, Lippo Centre 89 Queensway Hong Kong. Tel: 852-2521 9200 Fax: 852-2840 1601 CORPORATE DIRECTORY www.ta.com.my 1
TABLE OF CONTENTS Notice of Twenty-First Annual General Meeting Statement Accompanying Notice of Annual General Meeting Corporate Information DirectorsÕ Profile Chairman s Statement Corporate Social Responsibility 5-year Group Financial Summary Segmental Analysis Statement on Corporate Governance Report on Audit Committee Statement on Internal Control Statement on DirectorsÕ Responsibility in relation to Financial Statements Directors Report Statement by Directors Statutory Declaration Independent AuditorsÕ Report Consolidated Statement of Financial Position Consolidated Income Statement Consolidated Statement of Comprehensive Income Consolidated Statement of Changes in Equity Consolidated Statement of Cash Flows Statement of Financial Position Statement of Comprehensive Income Statement of Changes in Equity Statement of Cash Flows Notes to the Financial Statements List of Properties held by TA Enterprise Berhad Group Analysis of Shareholdings Form of Proxy 04 07 09 12 21 28 31 33 35 43 47 51 52 58 58 59 62 64 65 66 68 71 72 73 74 76 216 218 2
Governed by INTEGRITY At TA Group we place the utmost importance in the integrity of every individual that we employ or deal with. At TA Group we strive to practice integrity in all our actions, decisions, practices, policies and procedures. This relates to both internally within the organisation as well as externally to all parties that we deal and associate with. 3
Notice of 21 st Annual General Meeting AGENDA NOTICE IS HEREBY GIVEN THAT THE TWENTY-FIRST ANNUAL GENERAL MEETING OF TA ENTERPRISE BERHAD WILL BE HELD AT THE AUDITORIUM, 10TH FLOOR, MENARA TA ONE, 22 JALAN P. RAMLEE, 50250 KUALA LUMPUR ON THURSDAY, 30 JUNE 2011 AT 2.00 P.M. FOR THE FOLLOWING PURPOSES : AS ORDINARY BUSINESSES 1. 2. 3. 4. 5. To receive and adopt the Audited Financial Statements for the year ended 31 January 2011 and the Reports of the Directors and Auditors thereon. To approve a first and final dividend of 2% less taxation for the year ended 31 January 2011. To re-elect the following Directors: (a) (b) (c) Mr Jory Leong Kam Weng who retires by rotation in accordance with Article 102 of the CompanyÕ s Articles of Association. Mr Christopher Koh Swee Kiat who retires by rotation in accordance with Article 102 of the CompanyÕ s Articles of Association. Datin Rahmah Binti Mahmood who retires by rotation in accordance with Article 102 of the CompanyÕ s Articles of Association. To approve the payment of DirectorsÕ fees of RM120,000.00 for the year ended 31 January 2011. To re-appoint Messrs Ernst & Young as Auditors of the Company to hold office until the conclusion of the next Annual General Meeting and to authorise the Directors to fix their remuneration. Resolution 1 Resolution 2 Resolution 3a Resolution 3b Resolution 3c Resolution 4 Resolution 5 AS SPECIAL BUSINESSES 6. 6.1 To consider and if thought fit, to pass the following ordinary resolutions: Authority to Directors of the Company to issue shares Ò THAT subject always to the Companies Act, 1965, the Articles of Association of the Company and the approvals of the relevant government/regulatory authorities, the Directors be and are hereby empowered pursuant to Section 132D of the Companies Act, 1965 to further allot and issue ordinary shares in the Company from time to time upon such terms and conditions and for such purposes as the Directors may deem fit provided that the aggregate number of shares to be allotted and issued pursuant to this resolution does not exceed ten percent (10%) of the total issued share capital of the Company in any one financial year and that such authority shall remain in force until the conclusion of the next Annual General Meeting of the Company.Ó Resolution 6 4
Notice of 21 st Annual General Meeting 6.2 Proposed Shareholders Ratification for Recurrent Related Party Transaction of a Revenue or Trading Nature and Proposed Shareholders Mandate for Recurrent Related Party Transaction of a Revenue or Trading Nature Resolution 7 Ò THAT subject to the provisions of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, approval be and is hereby given for the ratification of the specified Recurrent Related Party Transaction entered into by the Company with the Related Party as stated in the Circular to Shareholders dated 8 June 2011 (hereinafter referred to as the Ò Proposed ShareholdersÕ RatificationÓ ); THAT subject to the provisions of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, approval be and is hereby given for the Company to enter into and to give effect to specified Recurrent Related Party Transaction with the Related Party as stated in the Circular to Shareholders dated 8 June 2011 (hereinafter referred to as the Ò Proposed ShareholdersÕ MandateÓ ); and THAT the Proposed ShareholdersÕ Mandate is subject to annual renewal and if approved by the shareholders of the Company at the forthcoming Twenty-First Annual General Meeting shall take immediate effect from the date of the Twenty-First Annual General Meeting and continue to be in force until: (a) (b) (c) the conclusion of the next annual general meeting of the Company following the Twenty-First Annual General Meeting at which such Proposed ShareholdersÕ Mandate was passed, at which time it will lapse, unless by a resolution passed at the meeting, the authority is renewed; the expiration of the period within which the next annual general meeting is required to be held pursuant to Section 143(1) of the Companies Act, 1965 (but shall not extend to such extension as may be allowed pursuant to Section 143(2) of the Companies Act, 1965); or revoked or varied by resolution passed by the shareholders of the Company in general meeting; whichever is the earlier; and THAT the Directors of the Company be and are hereby authorised to complete and do all such acts and things to give effect to the transaction contemplated and/or authorised by the Proposed ShareholdersÕ Ratification and the Proposed ShareholdersÕ Mandate.Ó 7. To transact any other business of which due notice shall have been received. NOTICE OF DIVIDEND ENTITLEMENT NOTICE IS HEREBY GIVEN THAT the first and final dividend of 2% less taxation for the year ended 31 January 2011, if approved by the shareholders at the CompanyÕ s Twenty-First Annual General Meeting, will be paid on 29 July 2011 to members whose names appear in the CompanyÕ s Register of Members at the close of business on 7 July 2011. A depositor shall qualify for entitlement only in respect of: 1. 2. 3. Shares transferred to the depositorõ s securities account before 4.00 p.m. on 7 July 2011 in respect of ordinary transfers; Shares deposited into the depositorõ s securities account before 12.30 p.m. on 5 July 2011 (in respect of shares exempted from mandatory deposit); and Shares bought on the Bursa Malaysia on a cum entitlement basis according to the Rules of Bursa Malaysia Securities Berhad. 5
Notice of 21 st Annual General Meeting BY ORDER OF THE BOARD KIMMY KHOO POH KIM (LS 04542) AGNES LIM BOON YOKE (MAICSA 7039524) Secretaries 8 June 2011 Notes: 1. 2. 3. 4. A member entitled to attend and vote at this meeting is entitled to appoint a proxy or proxies (but not more than two) to attend and vote in his stead. A proxy may but need not be a member of the Company and if he is not a member, he need not be an advocate, an approved company auditor or a person approved by the Companies Commission of Malaysia for this purpose. The Form of Proxy, in the case of an individual, shall be signed by the appointer or his attorney and in the case of a corporation, shall be given under its common seal or signed on its behalf by an attorney or officer of the corporation so authorised. Where a member appoints more than one proxy, the appointment shall be invalid unless he specifies the proportion of his holdings to be represented by each proxy. The Form of Proxy must be deposited with the Share Registrar of the Company at Tricor Investor Services Sdn Bhd at Level 17, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur not less than forty-eight (48) hours before the time appointed for holding the meeting or any adjournment thereof. Explanatory Notes On Special Businesses: 5. This is the renewal of the mandate obtained from the members at the last Annual General Meeting (Ò the previous mandateó ). The previous mandate was not utilised and accordingly no proceeds were raised. The proposed Ordinary Resolution No. 6, if passed, will empower the Directors of the Company to issue and allot shares in the Company up to an amount not exceeding ten percent (10%) of the issued capital of the Company for the time being. This authorisation will provide flexibility to the Directors to undertake fund raising activities, including but not limited to placement of shares for the funding of the CompanyÕ s future investment projects, working capital, acquisitions and/or implementation of EmployeesÕ Share Option Scheme by the issuance of shares in the Company to such persons at any time as the Directors may deem fit, without having to convene a general meeting. This authority unless revoked or varied at a general meeting will expire at the next Annual General Meeting of the Company. 6. The proposed Ordinary Resolution No. 7, if passed, will empower the Company to do the following: (a) (b) to ratify the specified recurrent related party transaction entered into by the Company from 23 November 2009, being the listing date of TA Global Berhad, a subsidiary of the Company until the date of the CompanyÕ s forthcoming Twenty-First Annual General Meeting; and to enter into recurrent related party transaction from the date of the CompanyÕ s forthcoming Twenty-First Annual General Meeting up to the conclusion of the next annual general meting. Further details of the Proposed ShareholdersÕ Ratification and Proposed ShareholdersÕ Mandate for the Recurrent Related Party Transaction of a Revenue or Trading Nature are set out in the Circular to Shareholders dated 8 June 2011. 6
Statement Accompanying Notice of Annual General Meeting 1. THE DIRECTORS WHO ARE STANDING FOR RE-ELECTION Mr Jory Leong Kam Weng Mr Christopher Koh Swee Kiat Datin Rahmah Binti Mahmood 2. DETAILS OF ATTENDANCE OF DIRECTORS AT BOARD MEETINGS There were five (5) Board of DirectorsÕ Meetings held during the financial year ended 31 January 2011. The attendance of the Directors at the Board Meetings is presented in the Statement on Corporate Governance on page 36. 3. PLACE, DATE AND HOUR OF MEETING Date : Thursday, 30 June 2011 Time : 2.00 p.m. Place : The Auditorium 10th Floor, Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur 4. PROFILE OF DIRECTORS STANDING FOR RE-ELECTION Further details pertaining to Directors standing for re-election are outlined on pages 12 to 20 of the Annual Report. Details pertaining to the DirectorsÕ interest in the securities of the Company and its subsidiaries are outlined on pages 54 to 55 and 218 of the Annual Report. 7
Encouraging INNOVATION In TA Group, it is our culture to constantly encourage a progressive work environment where new ideas, inputs, opinions and suggestions are highly cherished and favoured. 8
BOARD OF DIRECTORS Datuk Tiah Thee Kian Non-Independent Non-Executive Chairman Datin Tan Kuay Fong Managing Director & Chief Executive Officer COMPANY SECRETARIES Kimmy Khoo Poh Kim (LS 04542) Agnes Lim Boon Yoke (MAICSA 7039524) Zainab Binti Ahmad Executive Director Yaw Chun Soon Executive Director Dato Sri Mohamed Bin Abid Non-Independent Non-Executive Director Peter U Chin Wei Independent Non-Executive Director Jory Leong Kam Weng Independent Non-Executive Director AUDIT COMMITTEE Peter U Chin Wei Chairman Jory Leong Kam Weng Member Christopher Koh Swee Kiat Member Christopher Koh Swee Kiat Independent Non-Executive Director Datin Rahmah Binti Mahmood Independent Non-Executive Director 9
Registered Office 34th Floor, Menara TA One 22 Jalan P. Ramlee 50250 Kuala Lumpur Malaysia. Tel : 03-2072 1277 Fax : 03-2031 6608 Share Registrar Stock Exchange Listing Main Market of Bursa Malaysia Securities Berhad Auditors Ernst & Young Tricor Investor Services Sdn Bhd (118401-V) Level 17, The Gardens North Tower Mid Valley City, Lingkaran Syed Putra 59200 Kuala Lumpur Tel : 03-2264 3883 Fax : 03-2282 1886 Stock Code 4898 CORPORATE INFORMATION 10
Committed to EXCELLENCE We at TA Group define excellence as the never-ending, uncompromising pursuit of doing things better. We believe that excellence is not a standard or level of competency; excellence is the desire of wanting to get better, to grow, to expand, to achieve and to progress. It is the uncompromising commitment to move forward and get better in everything that we do. 11
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Chairman s Statement FINANCIAL REVIEW Group revenue increased by 41.5% from RM437 million in 2010 to RM619 million in 2011. Profit after tax was RM106.8 million, a decrease of 6% from RM113.8 million for 2010. The broking and financial services recorded lower profits of 17% for 2011 but remained as the biggest contributor to the GroupÕ s profits and is slightly ahead of the hotel operation division. The two divisions contributed 39% and 38% respectively to the GroupÕ s profit before tax. The drop in profits from the broking and financial services was attributable to lower gain on disposal of investment securities and higher provision for impairment losses on trade receivables. Hotel operations revenue surged 101.9% as 3 of the 4 hotels which were newly acquired or operational during the last financial year provided a full 12-month contribution to the Group. The Hotel divisionõ s contribution comprised 51% of total Group turnover as compared with 36% in the last financial year. In line with the increase in revenue, the profit before tax of Hotel operations also increased by 93%. The property development division recorded a 25% drop in profits before tax due to the completion of old projects and as new projects were launched only at the end of the current financial year, had resulted in lower profits due to the time lag. EPS is 4.75 sen per share in 2011 compared to 5.94 sen per share in 2010. DIVIDEND The Board is recommending a first and final dividend of 2% less taxation for the financial year ended 31 January 2011 pending shareholdersõ approval. TA Enterprise has a dividend policy of 40% to 60% of the GroupÕ s profit after tax (PAT) excluding TA Global BerhadÕ s (TAG) PAT but includes 40% to 60% of the total dividend income receivable from TAG for the same financial year. TAG, a 73.4% subsidiary of TAE listed on the Main Market of Bursa Malaysia, has its own dividend policy of 20% to 50% of its PAT. OPERATIONS REVIEW AND DEVELOPMENT STOCKBROKING Dear Shareholders, On behalf of the Board of Directors of TA Enterprise Berhad, it gives me utmost pleasure to present to you, the 21st Annual Report and Financial Statements of the Group and the Company for the financial year ended 31 January 2011. Malaysia During the financial year under review, TA Securities Holdings Berhad (Ò TASHÓ ) recorded a pre-tax profit of RM39.4 million despite the stiff competition and liberalization of the commission sharing with remisiers. The FBM KLCI began 2010 on a positive note but was dragged lower by concerns over ChinaÕ s credit tightening measures and escalating worries about EuropeÕ s debt crisis towards end 1Q 2010. Much of the concerns dissipated after the Greece bailout and ChinaÕ s move to let its currency appreciate against the US dollar in June. The ensuing rally, which was supported by a favorable outlook for the Ringgit and encouraging 2Q 2010 corporate results continued into October when the government unveiled its Economic Transformation Programme. The FBM KLCI had seen a steady rise since July 2010 and managed to climb to the yearõ s high of 1,532 points 21
Chairman s Statement on 19th November 2010. The index closed the year at 1,519 points for a gain of 19.3% compared to 2009Õ s close of 1,273 points. In line with our expansion plans, we opened our 6th branch in in Wisma TA, Damansara Utama on 27th September 2010 to cater to our clients and remisiers and also to attract potential clients/remisiers staying in the vicinity. This is the first branch in which the Ô RemisierÕ s MobilityÕ system was implemented for all the remisiers. This system allows the remisiers to execute their clientsõ orders even when they are out of the office whilst allowing access to back office information, charts and research reports. We will continue to be on the lookout for strategic locations to open new branches as well as extending the Ô RemisierÕ s MobilityÕ system to other branches and Principal Office. It is our desire to practice prudent risk management and enhance our products to be more competitive in order to improve our market share. Hong Kong TAHK posted a lower pre-tax profit of HK$2.7m for the financial year ended 31 January 2011 due to the keen competition from the Mainland based broking firms setting up their offices in Hong Kong. The local market experienced a roller coaster ride in 2010 with the Hang Seng Index ranging between 18,900 and 24,900 points. It ended the year at 23,035 points, with a modest gain of 5.3% compared to 21,872 points for the close of 2009. In response to concerns over the withdrawal of stimulus measures by central governments around the world and worries over the European debt crisis, the local benchmark tumbled to its yearõ s low of 18,971 points in May 2010. The local market rebounded strongly and posted its yearõ s high of 24,988 points in early November 2010, boosted by the launch of the second round of quantitative easing by the US Federal Reserve. However, the tension in the Korean Peninsula together with the spreading of the sovereign debts crisis in EU dragged the market down again in late 2010. The consecutive increases in deposit reserve rate in Mainland China by the PeopleÕ s Bank of China also dampened investorsõ confidence and sent the local benchmark down to 23,035 by the end of 2010. In order to further strengthen Hong Kong as a global financial and RMB offshore centre as well as to narrow the gap between its trading hour duration and those of regional competitors, the Hong Kong Stock Exchange decided to extend its trading hours from 7 March 2011 and to launch more RMB-denominated products in the second half of 2011. Hopefully, the said developments would help us to enhance our trade volume in future. UNIT TRUST AND ASSET MANAGEMENT For the financial year ended 31 January 2011, TA Investment Management Berhad (Ò TAIMÓ ) has total assets of RM755.19 million, being a combination of unit trust funds and direct mandate portfolios under its management. Uncertainty and volatility continued to plague the investment market as one crisis after another hit the world. Although the severity is not comparable to the 2008 global financial crisis, such Ò mini crisisó do affect market sentiments in the short-term. Taking the view that investors will have to live with higher volatility in the future, TAIM launched the TA BRIC & Emerging Markets Fund (Ò TABRICÓ ) to leverage on the long-term growth potential of emerging markets, in particular that of the BRIC countries. As for investors looking to hedge against volatility, we offered two closed-end funds, TA Australia Income Fund I and II (Ò TAAUSIF I and TAAUSIF IIÓ ) that provides consistent income returns. 22
Chairman s Statement TABRIC is a Fund that invests in Shariah-compliant equities and equity-related securities of companies that have their primary businesses in Brazil, Russia, India the PeopleÕ s Republic of China (Ò BRICÓ ) as well as other emerging markets. The Fund aims to provide medium to long-term capital growth from investments in a diversified portfolio of Shariah-compliant securities of emerging markets and domestic Sukuk. BRIC are countries rich in natural resources and the main drivers of their economy are the manufacturing and manpower sectors. TAAUSIF I and TAAUSIF II are our very first wholesale Funds that seek to provide investors with a regular income distribution in Australia Dollar (AUD) over an investment horizon of 3 and/or 5 years as well as in receive capital repayment in AUD upon maturity. The Funds will be invested in AUD denominated Fixed Rate Note (FRN) issued by a foreign financial institution with a minimum long-term debt rating of Ò AÓ by Standard & Poor or its equivalent by any reputable rating agencies. The FRN seeks to provide investors with an annual income distribution of an indicative 5.10% of the nominal amount over an investment horizon of 3 years and 6.25% of the nominal amount over an investment horizon of 5 years. TAIM has more than fourteen (14) years of experience in managing unit trust funds with a total of twenty (20) funds currently under its management. There are (3) funds which have performed at the top-3 of their market classification of Lipper Leaders Rating System based on 3-year periods as of 31 January 2011. On 24 July 2010, TAIM opened a new sales office in Penang and marks the companyõ s commitment in providing customer service to clients in the northern region. We plan to increase our current number of 14 Institutional Unit Trust Agents (IUTAs) and sign up at least 1 additional IUTA for this year to distribute our funds. We also plan to open up new business centers in Pahang and Johor to distribute our funds as we continue our effort to increase the number of tied agents. DERIVATIVES TA Futures won the Bursa Malaysia Derivatives BerhadÕ s Top Commodity Futures Broker award for 2010 again. The company had won the same award in 7 out of the last 8 years. The year 2010 had been a landmark year as the matching engine for all Bursa Malaysia Derivatives products was migrated to Chicago for greater exposure. Additionally, the companyõ s IT infrastructure was upgraded in tandem with the technological advances made in the industry. The crude palm oil futures (FCPO) market was active as erratic weather conditions around the world led to production irregularities in vegetable oils. Weather uncertainties and political instability in the Middle East in early 2011 has been putting upward pressure on crude oil prices, increasing its volatility and thus contributing to an active market. The increasing demand for vegetable oils from the expanding economies of China and India is expected to further improve trading volume in the derivatives market. Though the revenue decreased by about 2.8% to RM7.2million, the profit before and after tax increased by about 45.9% and 36.8% to RM2.1million and RM1.4million respectively. The increase in profit was due to a reduction in finance cost paid to TAE from RM879,584 in 2010 to RM167,808 in 2011. CREDIT AND LENDING For the financial year ending 2011, TA Capital Sdn Bhd (Ò TACÓ ) provided financing for Employees Share Option Scheme (Ò ESOSÓ ), Initial Public Offer (Ò IPOÓ ) to staff and investors of listed companies in Bursa Malaysia. We also provided short term loans and share financing to clients. Profit before tax and before extraordinary items was RM 7.91 million and is attributable to income earnings from ESOS / IPO financing. Having established our presence in the share financing business, TAC will continue to be active in ESOS / IPO financing. With more corporate listings and equity offerings in the capital market, we anticipate a bigger share of the financing activities. TAC will continue to increase its business revenue by providing term loan financing and mezzanine financing to assist companies requiring short term and medium term loans for working capital and business expansion. Short term loans for personal investments and share financing will also continue to be provided. 23
Chairman s Statement PROPERTY DEVELOPMENT MALAYSIA The property market has been vibrant with increased number of property transactions setting new benchmark prices for both land and new developments. The Group is poised to capitalize with its developments located in prime areas in Damansara Avenue, Cheras and Dutamas. While there was a profit drop of 25% in profit before tax in the property development division, it was mainly due to TAGÕ s timing its sales launch to enable it to extract the most out of its proposed developments. Looking forward, with the launch of the Azelia Residences in Damansara Avenue and our overseas launch of Little Bay in Sydney, Australia and the Gardens in Richmond, Canada, the Group is positive on its future prospects. Existing Projects Damansara Idaman Amania The Amania bungalows is the final phase of Damansara Idaman and is currently awaiting the issuance of the Certificate of Completion and Compliance. Damansara Avenue Damansara Avenue is a 10-year master planned community development sprawled across 48 acres of prime freehold land in Bandar Sri Damansara with a well-planned mix of commercial and residential developments anchored by a 7-acre urban park. Ativo Plaza consisting signature office suites and lifestyle retail units achieved sales of 87% for 198 units within the 1st week of sale. Selected units of our residential development in Damansara Avenue named Ò AzeliaÓ were launched in May 2011. New Projects Mixed Commercial Development opposite KLCC TA 3 & 4 Located strategically opposite KLCC, it will be the GroupÕ s integrated commercial development showcasing 2 iconic 50-storey towers comprising a luxury hotel, serviced apartments and residences. The Development Order has been received in February 2011 but is being reviewed to optimize efficiency. Condominium Development at Dutamas This freehold residential development situated near Mont Kiara will encompass 2 condominium towers. The Development Order is pending approval and the launch is targeted to be in the 4th quarter of 2011. Mixed Commercial Development in Bukit Bintang Nova Square This 3.075 acres of freehold mixed development is centrally located in Kuala LumpurÕ s Golden Triangle. The Development Order for this project is pending approval from the local authorities. Condominium Development in Cheras This residential development is freehold and located in the established neighbourhood of Taman Pertama, Cheras in close proximity to the proposed Cheras MRT station. The launch is targeted to be in Q4 pending receipt of the Development Order. 24
Chairman s Statement CANADA The Gardens Joint Venture, City of Richmond, Province of British Columbia The Gardens is a 22.78 acres of housing, retail and commercial development comprising of approximately 500 units residential apartments and 80,000 square feet of net saleable office and retail space. The maiden phase comprising of 83 units of apartments is expected to be launched in 3rd quarter of 2011. AUSTRALIA Little Bay Residential Development Project, Sydney, New South Wales Little Bay is the GroupÕ s maiden property development management activity in Australia. The 13.6 hectares of freehold development will include 542 dwellings of townhouses, courtyard homes and apartments with extensive coastal view and is located 14 km away from Sydney city centre. The initial launch comprising 30 townhouses and 40 apartments will be in the 4th quarter of 2011 and the project is targeted to complete by 2015. CONSTRUCTION For the financial year 2011, our construction division, TA Binaprestij Sdn Bhd achieved total revenue of RM30.8 million generated from construction works within the Group. Going forward, it will continue to be the in-house contractor for the GroupÕ s property development projects while sourcing for new projects or new land for development. PROPERTY INVESTMENTS MALAYSIA Menara TA One generates positive yields for the Group and is currently 88% occupied with an average rental rate of RM5.10 per square foot for 2011. Both our retail and office suites at Subang Business Centre and Taipan USJ located in USJ 9 and USJ 10 respectively continue to boast 100% occupancy rate and generate good rental income for the Group. Wisma TA located opposite Tropicana City Mall along the Lebuhraya Damansara Puchong (Ò LDPÓ ) was purchased in September 2009. It is currently 75.93% occupied with an average rental rate of RM2.92 per square foot. CANADA FortisBC Centre, formerly known as Terasen Centre in Downtown Vancouver financial district remains insulated from the recession due to its well-diversified tenancy and progressive lease expirations. It recorded a remarkable 99.41% occupancy rate and saw an increase in the average rental rate to C$21.29 per square foot. HOTEL OPERATIONS During the year, we completed the divestment of Swiss tel Merchant Court, Singapore to TA Global Berhad. This is in tandem with the business reorganization of TA Enterprise Berhad and listing of TA Global Berhad to enhance business synergy and to create operational efficiency. On 28 January 2011, TA Global entered into a sale and purchase of shares agreement for the acquisition of Swiss tel Kunshan, China for USD60,750,000.00. This purchase marks the maiden entry for the GroupÕ s expansion into China just before the financial year end. With a total of 5 hotels in Australia, Canada, Singapore and China, the hospitality division will continue to provide a steady revenue stream and recurring income to the Group even during challenging times. Radisson BLU Plaza Sydney, Australia Our Radisson BLU Plaza hotel, a 362 room boutique, international 5-star hotel in the Central Business District of Sydney. Following 5 months of refurbishment to its public places, the hotel was upgraded to Radisson BLU, which is the highest brand category within the Radisson Hotel brand. The hotel won 3 awards and emerged as finalist in 6 other awards for year 2010. The hotelõ s restaurant, BilsonÕ s was awarded Two Hats by the Sydney Morning Herald Good Food Guide 2011. The hotel maintained its number 2 ranking in itõ s competitive set in year 2010 for Occupancy and Revenue per Average Room which jumped 10.1% and 4.2% respectively. 25