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JMR Conglomeration Bhd.592280-W

日马集团股份有限公司

ANNUAL REPORT I 2017

Contents

02 Corporate Information

03 Group Corporate Structure

04 Directors’ Profile

07 Profile of Key Management

09 Chairman’s Statement and Management Discussion and Analysis

13 Statement on Corporate Governance

19 Audit Committee Report

22 Statement on Risk Management and Internal Control

24 Other Information

Financial Statements

25 Directors’ Report

29 Statement by Directors

29 Declaration by the Director

30 Independent Auditors’ Report to the Members

34 Statements of Comprehensive Income

35 Statements of Financial Position

37 Statements of Changes in Equity

38 Statements of Cash Flows

41 Notes to the Financial Statements

93 Supplementary information - disclosure on realised and unrealised profits/losses

94 Group Properties

96 Analysis of Shareholdings

98 Notice of Annual General Meeting

Form of Proxy

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Corporate Information

Board of Directors

Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai Group Executive ChairmanDato’ Ir. Dr. Goh Yong Chee Group Managing DirectorTham Yen Thim Independent and Non-Executive DirectorIr. Boey Cheng Hai Independent and Non-Executive DirectorDato' Abdul Rahman Bin Ahmad Senior Independent and Non-Executive DirectorTan Yen Yeow Independent and Non-Executive DirectorLim Tze Ming Executive Director

Audit Committee

Tan Yen Yeow ChairmanDato' Abdul Rahman Bin Ahmad MemberIr. Boey Cheng Hai Member

Nomination Committee

Tan Yen Yeow ChairmanDato' Abdul Rahman Bin Ahmad MemberTham Yen Thim Member

Remuneration Committee

Tan Yen Yeow ChairmanDato' Abdul Rahman Bin Ahmad MemberIr. Boey Cheng Hai Member

Registered Office

39, Salween Road10050 PenangMalaysiaTel : 604-210 9828Fax : 604-210 9827

Auditors

PKFChartered AccountantsLevel 33, Menara 1MKKompleks 1 Mont KiaraNo. 1, Jalan KiaraMont Kiara50480 Kuala LumpurTel : 603-6203 1888Fax : 603-6201 8880

Stock Exchange Listing

Main Market of Bursa MalaysiaSecurities BerhadStock Name : JMRStock Code : 7043

Domicile

Malaysia

Share Registrar

Insurban Corporate Services Sdn Bhd149, Jalan Aminuddin BakiTaman Tun Dr. Ismail60000 Kuala LumpurMalaysiaTel : 603-7729 5529Fax : 603-7728 5948

Principal Bankers

Hong Leong Bank BerhadHSBC Bank Malaysia BerhadMalayan Banking BerhadPublic Bank BerhadRHB Bank BerhadUnited Overseas Bank (Malaysia) BerhadOCBC Al-Amin Bank Berhad

Corporate Office

65, Sri Bahari Road10050 PenangMalaysiaTel : 604-264 4993Fax : 604-264 5122

Company Secretary

Ooi Yoong Yoong(MAICSA No. 7020753)

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JMR Conglomeration Bhd. 592280-W | Annual Report 2017

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Group Corporate Structure

JMR Conglomeration Bhd.(592280-W)

100%JMR Manufacturing Sdn. Bhd. (194470-X)

100%Lean Seng Chan (Quarry) Sdn. Bhd.(95565-T)

100%Great Marvel Sdn. Bhd.(862733-M)

100%JMR Resources Management Sdn. Bhd. (874916-H)

100%Great Marvel Development Sdn. Bhd.(1116513-U)

100%Multilight Sdn. Bhd. (73511-V)

100%Sunnyside Landscape Sdn. Bhd. (862735-T)

100%JCB (UK) Limited(9141099)

100%Link Lex (M) Sdn. Bhd.(39783-P)

100%Rantronics Sdn. Bhd.(170882-W)

100%JMR Quarry (Kedah) Sdn. Bhd. (666889-T)

85.7%Tag Steel Holdings Sdn. Bhd.(441245-W)

50%JMR-Hosna Bina Sdn. Bhd. (152844-P)

50%Diligent Success Sdn. Bhd. (538999-A)

98.60%Fook Lye Enterprises (M) Sdn. Bhd.

(38250-H)

50%Nanometric Electronics Sdn. Bhd.

(184325-H)

20%JML (Quarry) Sdn. Bhd.

(1018483-K)

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Directors’ Profile

Dato' Ir. Goh Nai Kooi @ Gah Mai Kwai, DSPN81 years of age, Malaysian, MaleGroup Executive Chairman

Dato' Ir. Goh Nai Kooi @ Gah Mai Kwai, DSPN, was appointed Group Executive Chairman of the Board of JMR Conglomeration Bhd. on 24 May 2004. He graduated with a Bachelor of Science (Engineering). He has had more than 45 years of experience in the area of civil and structural engineering. He is a member of the Institute of Engineers Malaysia (IEM), the Institute of Engineers Singapore (IES) and registered as a Professional Engineer with the Board of Engineers Malaysia (BEM). Dato’ Ir. Goh also participates actively in social associations and professional institutions.

By any standards, Dato’ Ir. Goh is a successful businessman who has combined his training as an engineer with an inborn keen business sense in the construction and development industry. These attributes have chiefly guided Dato’ Ir. Goh through several economic downturns. He is always among the pioneering few to tap new avenues of opportunities.

Dato’ Ir. Goh is responsible in guiding and overseeing the operation, business activities and performance of the entire Group including heading the Group’s business expansion and marketing programs.

Dato’ Ir. Goh also sits on the board of several private companies. Dato’ Ir. Goh is the father of Dato’ Ir. Dr. Goh Yong Chee. He has no conflict of interest with the Company and he is free from any offence in the past five (5) years other than traffic offences.

Dato’ Ir. Dr. Goh Yong Chee, DSPN53 years of age, Malaysian, MaleGroup Managing Director

Dato’ Ir. Dr. Goh Yong Chee, DSPN, was appointed Group Managing Director of the Board of JMR Conglomeration Bhd. on 24 May 2004. He completed his undergraduate and postgraduate studies in the United States of America. He has had more than 20 years of experience in the area of civil and structural engineering. He is a corporate member of the Institute of Engineers Malaysia (IEM), the Asean Federation of Engineering Organizations (AFEO) and registered as a Professional Engineer with the Board of Engineers Malaysia (BEM) and AFEO. Dato’ Ir. Dr. Goh is also actively participating in social associations and professional institutions. He is representing the Company to sit on the executive boards of Penang Chinese Chamber of Commerce and Penang Master Builders & Building Materials Dealers Association.

Dato’ Ir. Dr. Goh is responsible in managing and administrating the operations and business activities of the entire Group.

Dato’ Ir. Dr. Goh also sits on the board of several private companies. Dato’ Ir. Dr. Goh is the son of Dato’ Ir. Goh Nai Kooi. He has no conflict of interest with the Company and he is free from any offence in the past five (5) years other than traffic offences.

Tham Yen Thim, DJN, PJK86 years of age, Malaysian, MaleIndependent and Non-Executive DirectorMember of Nomination Committee

Tham Yen Thim, DJN, PJK, was appointed Non-Executive Director of the Board of JMR Conglomeration Bhd. on 24 May 2004. He was redesignated as Independent and Non-Executive Director on 13 July 2017. He completed his education in Malaysia. Presently, Mr. Tham has been actively involved in jewellery business owned by his family for more than 50 years. He is also a member of the steering committee of the association of jewellery in Malaysia.

Mr. Tham plays an active role in overseeing and advising the Group on its performance and business activities including its business expansion programs.

Mr. Tham also sits on the board of several private companies. None of his family members has direct or indirect relationship with any director and/or major shareholder of the Company. He has no conflict of interest with the Company and he is free from any offence in the past five (5) years other than traffic offences.

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Directors’ Profile (cont’d)

Dato' Abdul Rahman Bin Ahmad, DSPN, DJN, PKT, PJK82 years of age, Malaysian, MaleSenior Independent and Non-Executive DirectorMember of Audit, Nomination and Remuneration Committee

Dato' Abdul Rahman Bin Ahmad, DSPN, DJN, PKT, PJK, was appointed Non-Executive Director of the Board of JMR Conglomeration Bhd. on 24 May 2004. On 28 March 2008, he was redesignated as Senior Independent and Non-Executive Director. He obtained his education in Malaysia. Dato' Abdul Rahman worked in the Land Department in the Penang State Government as Deputy Director, after serving for 4 years he was transferred to the Ministry of Education for 2 years and then to Ministry of Lands & Mines as Director of Federal Land before his retirement in October 1984.

Dato' Abdul Rahman acts as a business advisor to the Group and at the same time taking the lead in handling all matters in connection with the local authorities.

Dato' Abdul Rahman also sits on the board of several private companies. None of his family members has direct or indirect relationship with any director and/or major shareholder of the Company. He has no conflict of interest with the Company and he is free from any offence in the past five (5) years other than traffic offences.

Ir. Boey Cheng Hai, PJK79 years of age, Malaysian, MaleIndependent and Non-Executive DirectorMember of Audit and Remuneration Committee

Ir. Boey Cheng Hai, PJK was appointed Independent Non-Executive Director of the Board of JMR Conglomeration Bhd. on 20 October 2004 and was re-designated as Non-Independent and Non-Executive Director on 28 March 2008. He was re-designated as Independent and Non-Executive Director on 1 April 2013. He graduated with a Bachelor of Science degree in Mechanical Engineering. He is a Corporate Member of the Institute of Engineers Malaysia (IEM) and the Asean Federation of Engineering Organizations (AFEO). He is a Professional Engineer registered with the Board of Engineers Malaysia (BEM) and also a Registered Visiting Engineer (Steam 1) with the Machinery Department of Malaysia.

His career took off as an engineer in the sugar cane and oil palm industries in Malaysia. Later, he was promoted to management position. He was the Chief Engineer for PPB Oil Palms Berhad before his retirement.

Ir. Boey advises the Group on matters pertaining to investing activities involving heavy machinery and equipment including the related expansion programs.

Ir. Boey also sits on the board for several private companies. None of his family members has direct or indirect relationship with any director and/or major shareholder of the Company. He has no conflict of interest with the Company and he is free from any offence in the past five (5) years other than traffic offences.

Tan Yen Yeow47 years of age, Malaysian, MaleIndependent and Non-Executive DirectorChairman of Audit, Nomination and Remuneration Committee

Tan Yen Yeow was appointed Independent Non-Executive Director of the Board of JMR Conglomeration Bhd. on 1 April 2013. He is a member of the Malaysian Institute of Accountants, The Institute of Internal Auditors Malaysia and the Chartered Tax Institute of Malaysia.

Mr. Tan began his professional career with KPMG in 1990 as an articled student under the MICPA programme. After serving for 9 years at KPMG, he left and set up his audit firm, Tan Yen Yeow & Company in 2001. He has been involved in providing professional services which include auditing, internal auditing and risk management.

Mr. Tan chairs the Audit, Remuneration and Nomination Committees of the Group. He is actively overseeing the Group's corporate governance matters, accounting and management functions.

Mr. Tan presently holds directorship in Ewein Berhad and also sits on the board of two private companies. None of his family members has direct or indirect relationship with any director and/or major shareholder of the Company. He has no conflict of interest with the Company and he is free from any offence in the past five (5) years other than traffic offences.

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Lim Tze Ming34 years of age, Malaysian, MaleExecutive Director

Lim Tze Ming was appointed Executive Director of the Board of JMR Conglomeration Bhd. on 20 November 2014. He was appointed as Alternate Director on 20 January 2014, resignation as Alternate Director on 21 October 2014. He is a member of the Malaysian Institute of Accountants and Malaysian Association of Company Secretaries.

Mr. Lim was attached to public accounting firms prior to joining the Group in 2010. He has vast experience in accounting, tax, audit, finance and budgetary control. He joined the Group as Accountant and subsequently he was promoted to the position of Account Manager in 2015. He is responsible for the Group’s corporate and finance functions. In addition, he also assists the Group Managing Director in overseeing the planning, development and overall management of the Group.

Mr. Lim does not have any other directorships of public companies. None of his family members has direct or indirect relationship with any director and/or major shareholder of the Company. He has no conflict of interest with the Company and he is free from any offence in the past five (5) years other than traffic offences.

Directors’ Profile

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Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai81 years of age, Malaysian, MaleGroup Executive Chairman

Please refer to page 4 under the Directors’ profile in this Annual Report.

Dato’ Ir. Dr. Goh Yong Chee53 years of age, Malaysian, MaleGroup Managing Director


Lim Tze Ming34 years of age, Malaysian, MaleExecutive Director


Nik Ahamad Shukri Bin Nik Abdul Majid52 years of age, Malaysian, MaleBranch Manager (Manufacturing Division)

Nik Ahamad Shukri Bin Nik Abdul Majid holds Diploma in Business Studies (Marketing) from Institut Teknologi Mara in 1987.

En. Nik started his own business in trading and export the timber. In 1994, he works as Quality Control Superintendent, actively involved in precast concrete industry. After serving three (3) years, he then left to join another precast company as Production Manager from year 1998 till 2002. In 2002, En. Nik joined the Group as Site Supervisor and subsequently promoted as Branch Manager in 2011. He was appointed Director of JMR Manufacturing Sdn Bhd on 16 December 2013. Currently, he is handling the daily operations at Kedah branch. He is responsible in overseeing the manufacturing activities and overall performance of manufacturing division. En. Nik does not have any other directorships of public companies. None of his family members has direct or indirect relationship with any director and/or major shareholder of the Company. He has no conflict of interest with the Company and he is free from any offence in the past five (5) years other than traffic offences.

Fong Kar Ing53 years of age, Malaysian, MaleDevelopment Manager (Property Development Division)

Fong Kar Ing holds Diploma in Building Technology from Tunku Abdul Rahman College year 1988 and registered as Safety and Health Officer since year 2008.

Mr. Fong started his career since graduation as Marketing Manager attached to a local waterproofing specialist. Roles involved in designing and recommending waterproofing methods and products to consultants, developers as well as factory owner. In 2005, he joined the Group as site executive and actively involved in the implementation of housing project in mainland. Five (5) years later, he was promoted to development manager, a position he continues to hold up till today.

With over seventeen (17) years of experience in construction industry, he is currently responsible in project management, collaboration with architects, consultants and contractors from various disciplines, liaison with local authorities, property planning, project evaluation and costing, as well as the executions of housing projects.

Mr. Fong does not have any other directorships of public companies. None of his family members has direct or indirect relationship with any director and/or major shareholder of the Company. He has no conflict of interest with the Company and he is free from any offence in the past five (5) years other than traffic offences.

Profile of Key Management

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Lee See See50 years of age, Malaysian, FemaleAdmin and Marketing Manager (Property Development Division)

Lee See See holds a Business Management Certification from the Institute of Simyong and obtained professional certificate in accounting in year 1987.

Ms. Lee career began in 1987, where she held various positions in the areas of finance and accounting for public listed companies as well as private companies, she involved in full set accounting, internal and external auditing, process improvement, policies and procedures processes and etc.

In 2004, she decided to make a fresh start as Marketing Executive, where totally a different sector. She joined the Group in 2006 as Admin and Marketing Executive and involved in the Group’s several property projects, maintaining the Group’s properties assets and current housing development of Taman Perdana.

She was promoted to Admin and Marketing Manager in 2012, taking charged on housing development marketing activities and administration processing.

Ms. Lee does not have any other directorships of public companies. None of her family members has direct or indirect relationship with any director and/or major shareholder of the Company. She has no conflict of interest with the Company and she is free from any offence in the past five (5) years other than traffic offences.

Profile of Key Management (cont’d)

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Chairman’s Statement and Management Discussion and Analysis

Over a decade of listed in Bursa Malaysia, JMR Conglomeration Bhd (“JMR”) has established itself as one of the major players in the northern region of Malaysia in manufacturing of asphaltic concrete, quarrying and property development.

On behalf of the Board of Directors, I am pleased to present our Annual Report of JMR Conglomeration Bhd and its subsidiaries for the financial year ended 31 March 2017.

• SA65 Taman Perdana, B3 Bungalow

• Completed Roadwork at Langkawi

“ Our Belief - Your Trust, Our People and the Success ”

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• Quarry Plant• LSC Quarry Site

• Premix Plant - Penang

• Premix Plant - Langkawi

Operations Overview

In the past financial year, JMR continued its business activities in the field of manufacturing of construction material to property development and others as well. JMR carried out its operation by staying true to its Core Values and this ascertained the fundamental strength of the Group; therefore, even another challenging year ahead is expected as the global economy has not shown any sign of stable recovery, JMR is confident to maintain its current performance.

In the upcoming financial year, JMR will proceed to set-up the planned asphaltic concrete plant in Penang State. It will continue to launch the Phase 3 residential scheme at SA65 Taman Perdana, at Simpang Ampat, Penang and the related Casa Perdana’s houses. At the same time, JMR will continue to get ready it bigger scale schemes, namely Marvel City and Marvel View, for launching in the following years.

And, JMR will also continue to explore good business opportunities locally and internationally.

Core Values

• VALUE

This is our guiding principle which defines our contribution to the company. We realize the value of building a legacy within the organization that would endure the ebb and flow of the business cycle. Therefore, the management and staff alike are empowered to chart their progress and growth in the company. At every level, innovation and resourcefulness is encouraged and nurtured in order to make incremental improvements in our operations, service and products.

• DIGNITY, INTEGRITY AND FULFILMENT

We tap the potential of our staff and entrust them with responsibilities whilst supporting and commending their efforts in order to attract and retain an agile and talented workforce that is able to respond to the needs of the company and its customers.

• TRUST

By giving full disclosure of our company, we intend to earn the trust and confidence of our shareholders and investors alike.

• DISCIPLINE

Acknowledging our responsibilities to our shareholders, the company will continue to practice business and financial prudence by approaching all projects by weighing all avenues exhaustively, tapping into a balance of tried and true strategies and amalgamating these with new practices that would enhance our rate of success and minimize the impact of external factors.

Chairman’s Statement and Management Discussion and Analysis (cont’d)

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Financial Overview

JCB and its subsidiaries ("the Group") recorded revenue of RM24.02 million and profit before exceptional items and tax of RM1.31 million for the present financial year ended 2017 as compared to RM29.52 million and RM6.92 million in the previous financial year. Relatively, the Group’s revenue and profit before exceptional items and tax decreased by RM5.50 million and RM5.62 million were mainly attributable to the reduced contribution from manufacturing division due to weaker demand and competitive pricing in the industry. Profit after tax was RM0.81 million. Earnings per share stood at 0.64 sen.

The financial position of the Group remains strong, total borrowings of the Group were reduced to RM19.43 million as at 31 March 2017 from RM22.20 million in 31 March 2016. The Group’s gearing ratio as at 31 March 2017 fell to 19.85% from 22.01% a year ago. In terms of significant changes in inventories and property development cost of the Group mainly due to capitalisation of the development cost upon completion of Phase 2 residential scheme at SA65 Taman Perdana. Net tangible assets per share was RM0.76 and equity attributable to owners stood at RM97.87 million as at year end.

Manufacturing Division

Revenue from manufacturing division decreased 36.66% or RM6.51 million to RM11.25 million in the current financial year as compared to RM17.76 million in the last financial year. However, the operating profit of the manufacturing division increased to RM1.63 million from RM1.25 million in the last financial year which mainly due to higher other gains and losses incurred in the preceding year.

Construction Division

The revenue from the construction division decreased to RM0.15 million in the current period from RM0.32 million in the preceding year corresponding period. Hence, the division recorded an operating loss of the RM0.98 million as compared to the operating loss of RM0.72 million in the corresponding period.

Property Development Division

Revenue arising from the property development division has slightly increased from the RM11.08 million recorded in the last financial year to RM12.22 million representing an increase of 10.29%. However, the division recorded an operating profit of RM1.60 million as compared to the operating profit of RM4.23 million in the corresponding period due to slower sales progress of existing SA 65 project in during the financial year.

• Property Roadshow

• SA65 Taman Perdana, T1 Terrace Interior


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Prospects

As the global economy soften, JMR is optimistic to continue to set-up its planned asphaltic concrete plant in Penang State in order to gear up the production capacity for some sizeable upcoming private and public infrastructure projects. At the same time, the planning of commencing its quarry at Bukit Perak in Kedah State continues strategically, pending the evaluation of the related economy prospect.

The launching preparation for the Phase 3 houses at SA65 Taman Perdana at Simpang Ampat, Penang is ready and the official launch date has been set at the end of year 2017. And, Casa Perdana, the residential development scheme at the same location, will be launched sometime after the third quarter of year 2018. The planning of Marvel City, an integrated property development scheme at Juru, Penang and Marvel View, a high-rise commercial building at Butterworth, Penang is in good progress to ascertain the launching readiness in the following years.

There is a delay in the property development scheme in United Kingdom due to the current situation in the country; close monitoring and careful evaluation are carried out from time to time, before further proceeding to ascertain the integrity of the development.

Meanwhile, JMR is actively looking for profitable businesses that are related to our business model in our local market and overseas, to participate in.

Dividend

During the financial year, the Directors declared an interim single tier tax exempt dividend of 3 sen per share on 126,784,397 ordinary shares amounting to RM3,803,532 that was paid on 30 December 2016. No other dividend has been paid or declared by the Company since then.

The Directors do not recommend the payment of any final dividend for the financial year ended 31 March 2017.

Acknowledgement

On behalf of the Board, I would like to thank the Directors, the management and the staff of the Group for their dedication, commitment and contribution to strengthen the sustainability of the Group in the past year. I would like to also express my sincere thanks to the shareholders, bankers, clients and associates for their support for continued growth. I am confident that with our strong corporate culture and assets, our Group is certain to manoeuvre through this very challenging market environment and gear ourselves for the next level of achievements in the coming years.

Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai, DSPNGroup Executive Chairman

• SA65 Casa Perdana Terrace

• SA65 Taman Perdana, T2 Terrace • SA65 Casa Perdana Semi-D


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Statement On Corporate Governance

The Board of Directors of the Company recognises and subscribes to the importance of the principles and best practices set out in the Malaysian Code on Corporate Governance ("the Code") as a key factor towards achieving an optimal governance framework and maximising the shareholder value of the Company.

The following report details the manner in which the Group has applied the principles and guidance of good corporate governance set out in the Code and except as stated otherwise, its compliance with the same as well as the relevant provisions in the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“Listing Requirements”).

ROLES AND RESPONSIBLILITY OF THE BOARD

The Board has the overall stewardship responsibilities of providing strategic leadership, overseeing the business conduct, identification and management of principal risks, ensuring the adequacy and integrity of internal control systems, establishing a succession plan and developing and implementing and investor relations program.

The Board has delegated specific responsibilities to three (3) committees, namely, the Audit Committee, Remuneration Committee and the Nomination Committee, of which discharge the duties and responsibilities within their respective Terms of Reference. The actual decision is the responsibility of the Board after considering the recommendations of the respective committee.

The role of the Chairman and the Group Managing Director are distinct and separated. Each has a clearly accepted division of responsibilities and there is a balance of power and authority and that no individual has unfettered powers of decision. The Chairman is primarily responsible for ensuring the Board effectiveness and conduct whist the Group Managing Director has the responsibility over the operational and business units, organizational effectiveness and implementation of the Board policies, directives and strategies.

The Company’s Code of Ethics and Code of Conduct are set out in Company’s Employment Handbook, which covers matters in relation to conflict of interest, entertainment and gifts, misuse of position and insider trading. The directors and employees of the Group are expected to adhere to the standard of ethics and conducts set out therein.

The Company also has in place a Whistleblowing Policy which is aimed at protecting the integrity, transparency, impartiality and accountability where the Group conducts its business operations. The Whistleblowing Policy provides a structured reporting channel and guidance to all employees and external parties to whistleblow without the fear of victimisation. The Whistleblowing Policy is available for access on the Company’s intranet and corporate website.

The Board has established clear functions reserved for the Board and those delegated to Management in the Board Charter (the “Charter”) which serves as a reference point for Board’s activities. The Charter shall provide guidance for Directors and Management on the responsibilities of the Board, its Committees and requirements of Directors.

STRENGTHEN COMPOSITION

The Board of Directors and Board Balance

The current Board consists of seven (7) members, comprising three (3) Executive Directors and four (4) Independent Non-Executive Directors, which is in compliance with paragraph 15.02 of Listing Requirements in respect of the board composition.

The Board members with a diverse wealth of experience as well as skills and knowledge, which include accountancy, finance, technical, real estate development and property management. A brief profile of each Director is presented on pages 4 to 6 of this Annual Report. The presence of the Independent Non-Executive Directors are particularly important to provide independent advice and judgment to ensure a balanced and unbiased decisions making process and takes into account of the long term interests of the Group as well as to safeguard the interest of its shareholders.

The Board has appointed Dato’ Abdul Rahman Bin Ahmad to act as the Senior Independent and Non-Executive Director and any concerns of the minority shareholders of the Company in relation to the Group can be conveyed to him.

Access to Information and Advice

The Board of Directors has full and unrestricted access to all information pertaining to the Group. All Directors will receive an agenda and a full set of Board papers in a timely manner prior to the Board meeting to enable the Directors to obtain further explanations, where necessary, in order to be properly briefed before the meeting. Minutes of the Board Committees are also tabled at the Board meetings for the Board’s information and deliberation before it was signed by the Chairman of the meeting. During Board meetings, the senior management staff are invited to provide the necessary details on matters discussed, when necessary.

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Statement On Corporate Governance (cont’d)

Access to Information and Advice (cont'd)

All the Directors have full access to the advice and services of the Company Secretary who is responsible for ensuring that Board meeting procedures are followed and that applicable rules and regulations are complied well. The Board of Directors, whether as a full board or in their individual capacity may seek independent professional advice, where necessary and under appropriate circumstances at the Company’s expense in furtherance of their duties.

Nomination Committee

The Nomination Committee comprises of the following directors:-

ChairmanTan Yen Yeow Independent and Non-Executive Director

MembersDato’ Abdul Rahman Bin Ahmad Senior Independent and Non-Executive Director

Tham Yen ThimIndependent and Non-Executive Director

The Committee exclusively comprised of Non-Executive Director with a majority of whom are Independent Directors.

The Nomination Committee is empowered by the Board and its terms of reference to propose new nominees for the Board’s approval. The Committee also assesses the effectiveness and performance of the Board as a whole, the Committees of the Board and the individual assessment of Board Members. The Nomination Committee had met one (1) time and attended by all the members for the financial year under review.

Appointment of Directors

The Company has in place a formal procedure for the appointment of new Directors. All new nominees to the Board, will first be reviewed and considered by the Nomination Committee before the proposed appointment is recommended to the Board of Directors for approval.

Re-election of Directors

In accordance with the Constitution of the Company, all Directors who are appointed by the Board are subject to election by shareholders at the Company’s next Annual General Meeting (“AGM”) after their appointment. The Constitution also provides that one-third of the Directors for the time being shall, retire from office and provided always that all Directors shall retire from office at least once in every three (3) years. A retiring Director shall retain office until the close of the meeting at which he retires and shall be eligible for re-election. The election of each Director is voted on separately.

Remuneration Committee

The Remuneration Committee comprises of the following directors:-


MembersDato’ Abdul Rahman Bin Ahmad Senior Independent and Non-Executive Director

Ir. Boey Cheng HaiIndependent and Non-Executive Director

The Committee consists entirely of Non-Executive Director. The Committee is responsible for recommending the remuneration framework for Directors as well as the remuneration packages of Executive Directors to the Board. The determination of remuneration packages of Directors is a matter for the Board as a whole. Individuals concerned are required to abstain from deliberations of their own remuneration. Directors’ fees are approved at the Annual General Meeting, by the shareholders. The Remuneration Committee had met one (1) time for the financial year under review.

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Remuneration Committee (cont'd)

Aggregate remuneration of Directors categorised into appropriate components for the financial year ended 31 March 2017:-

Items Group CompanyExecutive DirectorsRM’000

Non-Executive DirectorsRM’000

Executive DirectorsRM’000

Non-Executive DirectorsRM’000

Fees 27 56 27 56Salaries and Other Emoluments 727 7 6 7Bonus 58 - - -

Number of Directors whose remuneration falls under each range:-

Range of RemunerationRM

Group CompanyExecutive Directors

Non-Executive Directors

Executive Directors

Non-Executive Directors

50,000 and below - 4 - -50,001 to 100,000 1 - - -300,001 to 350,000 2 - - -

The Remuneration Committee had met once and attended by all members for the financial year under review.

Audit Committee

The details on the composition, term of reference and summary of activities of the Audit Committee are set out on pages 19 to 21 of this Annual Report.

REINFORCE INDEPENDENCE OF THE BOARD

The Board undertakes an annual assessment of the independence of its Independent Directors. The Board, through the Nomination Committee, has established a set of criteria for the independent assessment, mainly focusing on the background, economic and family relationships of the Independent Directors, and considering whether the Independent Directors can continue to bring independent and objective judgement to Board deliberations.

During the financial year ended 31 March 2017, the Nomination Committee had assessed the Independent Directors and found that there were no circumstances that could interfere with such Director’s exercise of independent judgement. The Board is satisfied with the level of independent by all Independent Directors and would recommend such Directors to continue serve on the Board.

The tenure of an Independent Director should not exceed a cumulative term of nine (9) years. However, an Independent Director may continue to serve the Board subject to his re-designation as an Independent Director. The Board must justify and seek shareholders’ approval in the event that it retains a Director as an Independent Director, a person who has served in that capacity for more than nine (9) years. As at to-date, the Board has carried out an assessment of the Independent Directors and none of Independent Directors on the Board has served in their capacity for a cumulative of more than nine (9) years.

The position of Chairman and Group Managing Director are held by different individuals. The Chairman, Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai is an executive member of the Board and is not an independent director by virtue of his substantial interest in the Company. However, the Board believes that he is well placed to act on behalf of the shareholders in their best interest and it is not necessary to nominate an independent non-executive director as Chairman at this juncture. However, the Board will continuously review and evaluate the recommendation of the Code.

15



FOSTER COMMITMENT OF THE DIRECTORS

The Board meets at least four (4) times a year, scheduled well in advance before the end of the preceding financial year to facilitate the Directors in planning their meeting schedule for the year. Additional meetings are convened when urgent and important decisions need to be made between scheduled meetings. Board and Board Committees’ papers are prepared by Management to provide relevant facts and analysis for the convenience of Directors. The agenda, relevant reports and Board papers are furnished to the Directors and Board Committee members in advance to allow for sufficient time for Directors to promote effective discussions and decision-making during meetings. At the quarterly Board meetings, the Board reviews the business performance of the Group and discusses major operational and financial issues. The Chairman of the Audit Committee informs the Directors at each Board meeting of any salient matters noted which require the Board’s notice or direction. All pertinent issues discussed at Board meetings in arriving at the decisions and conclusions are properly recorded by the Company Secretary by way of minutes of meetings.

Board Meetings

The Board met Four (4) times during the financial year ended 31 March 2017. The attendance record of the Directors are disclosed as follows:-

Directors AttendanceDato’ Ir. Goh Nai Kooi @ Gah Mai Kwai 4/4Dato’ Ir. Dr. Goh Yong Chee 4/4Tham Yen Thim 4/4Ir. Boey Cheng Hai 4/4Dato’ Abdul Rahman Bin Ahmad 3/4Tan Yen Yeow 4/4Lim Tze Ming 4/4

Directors’ Training

All the Directors have successfully completed the Mandatory Accreditation Programme as prescribed by Listing Requirements. The Directors will continue to undergo other relevant training programmes to further enhance their skills and knowledge to effectively discharge their duties as Directors. The Board of Directors also received updates and briefings, particularly on regulatory, changes in regulatory framework, industry technology, including information on significant changes in business risks and procedures, accounting, construction and property development activities.

Throughout the financial year under review, the Directors attended various training programmes covering areas that included relevant industry updates, new developments in business environment and financial updates which they have, collectively or individually, considered as useful in discharging their stewardship responsibilities. For the year under review, the Directors attended the following conference seminars and training programme:-

Name of Directors Date Course Title Organiser

Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai

29 June 2016 Risk Based Thinking and Development and Maintenance of QMS Workshop Training

SGS (M) Sdn Bhd

Dato’ Ir. Dr. Goh Yong Chee 29 June 2016

22 September 2016

Risk Based Thinking and Development and Maintenance of QMS Workshop Training

Kursus Integriti & Kod Etika Kontraktor

SGS (M) Sdn Bhd

Lembaga Pembangunan Industri Pembinaan Malaysia

Tham Yen Thim 29 June 2016 Risk Based Thinking and Development and Maintenance of QMS Workshop Training

SGS (M) Sdn Bhd

Ir. Boey Cheng Hai 29 June 2016 Risk Based Thinking and Development and Maintenance of QMS Workshop Training

SGS (M) Sdn Bhd

Dato’ Abdul Rahman Bin Ahmad

29 June 2016 Risk Based Thinking and Development and Maintenance of QMS Workshop Training

SGS (M) Sdn Bhd

16


1717


Directors’ Training (continued)

Name of Directors Date Course Title Organiser

Tan Yen Yeow 29 June 2016 Risk Based Thinking and Development and Maintenance of QMS Workshop Training

SGS (M) Sdn Bhd

20 September 2016 Teammate Audit Management System The Institute of Internal Auditors Malaysia

10-11 October 2016 2016 National Conference Navigate Waves of the Digital Revolution

The Institute of Internal Auditors Malaysia

Lim Tze Ming 29 June 2016 Risk Based Thinking and Development and Maintenance of QMS Workshop Training

SGS (M) Sdn Bhd

9 August 2016 Persidangan Perlindungan Data Peribadi (Akta 709)

Personal Data Protection Commissioner Malaysia

5-6 September 2016 ISO 9001:2015 Internal Auditor SGS (M) Sdn Bhd

3 November 2016 Budget 2017 Tax Seminar BDO Tax Services Sdn Bhd

UPHOLD INTEGRITY IN FINANCIAL REPORTING

Financial Reporting

The Board is responsible for ensuring that the financial statements give a true and fair view of the state of affairs of the Group and of the Company as at the end of the financial year. This shall include their operation results and cash flows for the year then ended as well. In preparing the financial statements, the Directors have ensured that applicable approved Financial Reporting Standards for entities other than private entities issued by the Malaysian Accounting Standards Board and the provisions of the Companies Act, 2016 have been applied.

The Board is assisted by the Audit Committee to oversee the Group’s financial reporting process and the quality of its financial reporting. The Audit Committee, comprising wholly Independent and Non-Executive Directors, with the Senior Independent Director as the Committee Chairman, ensures that the financial statements of the Group and Company comply with applicable financial reporting standards in Malaysia.

Relationship with External Auditors

The Board and the Audit Committee have always maintained a professional and transparent relationship with the External Auditors in seeking professional advice and ensuring compliance with appropriate accounting standards. The External Auditors are expected to report their findings to the Audit Committee and to discuss with the Board of Directors on matters that necessitate the Board’s attention.

The Company has in place a policy to assess the suitability and independence of external auditors. To this extent, performance review of the external auditors will be conducted annually. The external auditors have confirmed and provided their written assurance to the Audit Committee that they have not identified any breach of independence and are in compliance with the independent requirements set out in the by-laws (on Professional Ethics, Conduct and Practice) for Professional Accountants of Malaysian Institute of Accountants.

RECOGNISE AND MANAGE RISKS

Risk Management and Internal Audit Function

Recognising the importance of risk management, the Board continuously reviews the Group’s risk management and internal control procedures to identify and assess key risks and controls and management’s plans to mitigate or eliminate the significant risks identified.

The Board engaged an independent professional accounting and consulting firm to carry out the independent internal audit functions which are reports directly to the Audit Committee. Through the Audit Committee, the Board has established transparent relationship with the internal auditors. Details of the Company’s internal control system and its framework including the scope of work during the financial year under review is provided in the Statement on Risk Management and Internal Control of the Group set out on pages 22 to 23 of this Annual Report.

17



ENSURE TIMELY AND HIGH QUALITY DISCLOSURE

The Board recognises the need for comprehensive, timely and accurate disclosures of all material Company information to the public so as to ensure a credible and responsible market in which participants conduct themselves with the highest standards of due diligence and investors have access to timely and accurate information to facilitate the evaluation of securities.

During the financial year under review, the Board has undertaken means of formalising its existing internal corporate disclosure policies and procedures not only to comply with the disclosure requirements as stipulated in the Listing Requirements, but also in setting out the protocols for disclosing material information to shareholders and stakeholders.

STRENGTHEN RELATIONSHIP BETWEEN COMPANY AND SHAREHOLDERS

Relationship with Shareholders

The Board recognises the need for transparency and accountability to the Company’s shareholders as well as regular communication with its shareholders, stakeholders and investors on the performance and major developments in the Company. Notice of the Annual General Meeting and Annual Report are sent out with sufficient notice before the date of the meeting. The Explanatory Notes on the proposed resolution under Special Business are provided to help the shareholders to decide on their vote on the resolution. Where Extraordinary General Meetings are held to obtain shareholders’ approval on certain business or corporate proposals, comprehensive circulars to shareholders would be sent within prescribed deadlines in accordance with regulatory and statutory provisions.

All shareholders, including private investors, have an opportunity to participate in discussion with the Board on matters relating to the Company’s operation and performance at the Company’s Annual General Meeting. Alternatively, they may obtain the Company’s latest announcement such as quarterly financial results, corporate announcements via the Bursa Malaysia Securities Berhad’s website at www.bursamalaysia.com. In addition, the Company maintains a website at www.jmr.com.my which is updated regularly for shareholders and the public to access information about the Group.

Annual General Meeting (“AGM”)

The AGM is the principal forum for dialogue and interaction with its shareholders. Shareholders are encouraged to participate in discussion pertaining to the operations and financial aspects of the Group. The Board members are available to respond to all queries and under take to provide clarification on issue raised by shareholders. The External Auditors are also present to provide their professional and independent clarification on queries raised by shareholders.

Shareholders are invited to ask questions regarding the resolutions being proposed before putting a resolution to vote as well as matters relating to the Group’s operations in general. All the resolutions set out in the Notice of the AGM were put to vote by poll and were duly passed. The outcome of the AGM was announced to Bursa on the same day.

COMPLIANCE WITH THE PRINCIPLES AND GUIDANCE OF THE CODE

For the year ended 31 March 2017, the Group has compiled substantially with the Principles and Guidance of the Code insofar as applicable and described herein.

This statement is issued in accordance with a resolution of the Directors dated 18 July 2017.

18


1919

Audit Committee Report

Members of the Audit Committee

The Audit Committee comprises the following directors:-


MembersDato’ Abdul Rahman Bin AhmadSenior Independent and Non-Executive Director

Ir. Boey Cheng HaiIndependent and Non-Executive Director

Terms of Reference

During the financial year, the Board, through the Nomination Committee, is satisfied that the AC and its members had discharged their functions, duties and responsibilities in accordance with the AC’s Terms of Reference in ensuring the Company and its subsidiaries (“Group”) upholds appropriate Corporate Governance standards. Pursuant to Paragraph 15.11 of the LR, the Terms of Reference of the AC is published on the Company’s website at www.jmr.com.my.

Summary of Activities

There were four (4) Audit Committee meetings held during the financial year. The following details the attendance record of the Audit Committee members:-

Members AttendanceTan Yen Yeow 4/4Dato’ Abdul Rahman Bin Ahmad 3/4Ir. Boey Cheng Hai 4/4

The summary activities of the Audit Committee during the financial year under review are as follows:-

1. Financial Reporting

• Reviewed the quarterly and annual financial statements of the Company and of the Group with the executive director, focusing particularly on appropriate accounting policies adopted by the Management, any adjustments arising from the audits, prudent judgements and reasonable estimates made by the Management are in accordance with the financial reporting standards and other legal requirements to ensure that the financial statements presented a true and fair view of the Group’s financial performance before recommending them to the Board for approval.

2. Related Party Transactions

• Reviewed the report by the Management in respect of recurrent related party transactions and possible conflict of interest situation that may arise within the Company or the Group to ensure all related party transactions were undertaken on an arm’s length basis and on normal commercial terms, consistent with the Group’s usual business practices and policies, which are not more favourable to the related parties than those generally available to the public and are not detrimental to the minority shareholders of the Company. During the year under review, there were no related party transactions involving the interest of the directors or major shareholders of the Company.

19


Audit Committee Report (cont’d)

Summary of Activities (continued)

3. External Audit

• Reviewed with the external auditors, the external audit plan, nature and scope of the audit plan and coordination of the external auditors to meet the key deliverables timeline.

• Reviewed with the external auditors, the audit review memorandum arising from audits of the Company and its subsidiaries together with comments and responses of the management including the assistance given by the management and employees of the Group.

• Assessed the independence, resources and the overall performance of the external auditors and upon assessment, recommended them to the Board for re-appointment.

• Held private sessions with the external auditors without the presence of the executive director or the Management of the Company to enquire about any extraordinary matters or material concerns related to the Group which required immediate attention of the Audit Committee.

4. Risk Management & Internal Control

• Reviewed with the internal auditors, the internal audit plan to ensure adequate coverage of key functional areas and business activities of the Group.

• Reviewed with the internal auditors, the internal audit reports to ensure appropriate corrective actions had been taken by the management to implement the audit recommendations.

• Reviewed with the internal auditors, the follow-up review reports on the status of implementation by the Management of the audit recommendations.

• Reviewed and report to the Board on the risks profile and the activities by the Risk Management Committee in mitigating the principal risks identified.

• Reviewed and report to the Board on the adequacy of the scope, function and effectiveness of the internal audit function.• Assessed and report to the Board on the resources, competencies and the overall performance of the internal auditors.

5. Annual Reports

• Reviewed the Statement on Risk Management and Internal Control, Audit Committee Report and Corporate Governance Disclosures and recommended to the Board for inclusion in the Company’s Annual Report.

20


2121

Audit Committee Report (cont’d)

Internal Audit Function

The Company’s internal audit function is carried out by BDO Governance Advisory Sdn. Bhd., an independent professional accounting and consulting firm. It reports directly and provides the Committee with independent and objective assurance on the adequacy and integrity of its system of internal controls and the extent of compliance towards the Group’s existing policies and procedures, applicable laws and regulations.

During the financial year ended 31 March 2017, the internal auditors had reviewed the systems of internal control on sales to receipts process and human resource management. Sales to receipts process covering the areas in sales forecasting, managing and processing of sales, product pricing, delivery shipment/ arrangement, outgoing quality control, customer database maintenance, customer credit evaluation and monitoring/management of overdue debts. While human resource management covering the areas in recruitment plan, recruitment, transfer and resignation control procedures, performance appraisal and reward process, training and development plan, processing and management of payroll, management of employee benefit schemes and disciplinary issues, and management of employee profiles.

The total cost incurred in relation to the conduct of the internal audit functions of the Group during the financial year ended 31 March 2017 amounted to RM21,097.

21


Statement On Risk Management And Internal Control

INTRODUCTION

The Malaysian Code of Corporate Governance requires listed companies to maintain a sound system risk management and internal control to safeguard shareholders’ investment and the Group’s assets.

Guided by the Statement on Risk Management and Internal Control: Guidelines for Directors of Listed Issuers, the Board of Director of JMR Conglomeration Bhd. is pleased to present the Statement on Risk Management and Internal Control which is prepared in accordance with Paragraph 15.26(b) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad.

RESPONSIBILITY FOR RISK MANAGEMENT AND INTERNAL CONTROL

The Board recognises its overall responsibility for the Group’s risk management and internal control for reviewing the adequacy and integrity of those systems. In view of the limitations that are inherent in any systems of risk management and internal control, the said systems are designed to manage risk within tolerable levels rather than eliminate the risk of failure to achieve business objectives. Hence, such system by its nature can only provide reasonable and not absolute assurance against material misstatement, error or losses.

The Board has established an ongoing process for identifying, evaluating and managing the significant risks faced, or potentially exposed to, by the Group in pursuing its business objectives. This process has been in place throughout the financial year and up to the date of approval of the annual report. The adequacy and effectiveness of this process have been continually reviewed by the Board and are in accordance with the said Guidelines in respect of risk management and internal control.

RISK MANAGEMENT

The Board and the management practice proactive significant risks identification in the processes and activities of the Group, particularly in major proposed transactions, changes in nature of activities and/or operating environment, or venturing into new operating environment which may entail different risks, and put in place the appropriate risk response strategies and controls until those risks are managed to, and maintained at, a tolerance level acceptable by the Board.

INTERNAL AUDIT

The Board acknowledges the importance of internal audit function and has outsourced its internal audit function to an independent professional accounting and consulting firm, BDO Governance Advisory Sdn Bhd as part of its efforts to provide adequate and effective internal control systems. The performance of internal audit function is carried out as per the annual audit plan approved by the Audit Committee.

The internal audit adopts a risk-based approach in developing its audit plan which addresses all the core auditable areas of the Group based on their risk profile. The audit focuses on high risk area to ensure that an adequate action plan has in place to improve the internal controls. The audit ascertains that the risks are effectively mitigated by the controls. The internal audit findings, recommendations and management responses are then presented to the Audit Committee. The highlighted areas will be followed up closely to determine the extent of their recommendations that have been implemented by the management.

INTERNAL CONTROL

Apart from risk management and internal audit, the Group has put in place the following key elements of internal control: • An organization structure with well-defined scopes of responsibility, clear lines of accountability, and appropriate levels of delegated

authority;• A process of hierarchical reporting which provides a documented and auditable trail of accountability; • A set of documented internal policies and procedures which is subject to regular review and improvement;• Regular and comprehensive information provided to management, covering financial and operational performance and key business

indicators, for effective monitoring and decision making;• Monthly monitoring of results against budget, with major variances being followed up and management action taken, where

necessary; and• Regular visits to operating units by members of the Board and senior management.

22


2323

Statement On Risk Management And Internal Control (cont’d)

REVIEW OF THIS STATEMENT BY EXTERNAL AUDITORS

As required by Paragraph 15.23 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the external auditors have reviewed this Statement on Risk Management and Internal Control. Their review was performed in accordance with Recommended Practice guide (“RPG”) 5 issued by the Malaysian Institute of Accountants. RPG 5 does not require the external auditors to form an opinion on the adequacy and effectiveness of the risk management and internal control systems of the Group.

CONCLUSION

The Board has received assurance from the top management and Group Managing Director that the Group’s risk management and internal control systems have been operating adequately and effectively, in all material aspects, during the financial year under review and up to date of this statement. Taking this assurance into consideration, the Board is of the view that there were no significant weaknesses in the current systems of risk management and internal control of the Group that may have material impact on the operations of the Group for the financial year ended 31 March 2017. The Board and the management will continue to take necessary measures and ongoing commitment to strengthen and improve its internal control environment and risk management. This statement is issued in accordance with a resolution of the Directors dated 18 July 2017.

23


Other Information

Utilisation of Proceeds Raised from Corporate Proposal

During the financial year, there were no proceeds raised by the Group from any corporate proposals.

Audit and Non-Audit Fees

The audit and non-audit fees incurred by the Company and the Group for services rendered by the external auditors for the financial year under review are as follows:

Group (RM’000) Company (RM’000)Audit Fees 83 22Non-Audit Fees - 3

Material Contracts Involving Directors and Major Shareholders

There were no material contracts (not being contracts entered into in the ordinary course of business) entered into by the Company and/or its subsidiaries, involving Directors’ and major shareholders’ interests during the financial year.

24


2525

Directors' Report

The Directors have pleasure in submitting their report and the audited financial statements of the Group and of the Company for the financial year ended 31 March 2017.

Principal activities The Company is principally involved in investment holding and providing management services. The principal activities of its subsidiaries are as disclosed in Note 15 to the financial statements.

There has been no significant change in the nature of the activities of the Group and of the Company during the financial year.

Results Group Company

RM RMProfit for the financial year attributable to:Owners of the Company 814,215 329,064Non-controlling interests 777 -

814,992 329,064

Reserves and provisions

There were no material transfers to or from reserves and provisions during the financial year other than those disclosed in the financial statements.

Dividends

During the financial year, the Directors declared an interim single tier tax exempt dividend of 3 sen per share on 126,784,397 ordinary shares amounting to RM3,803,532 that was paid on 30 December 2016. No other dividend has been paid or declared by the Company since then.

The Directors do not recommend any final dividend to be paid in respect of the current financial year.

Directors The directors of the Company in office during the financial year and during the period from the end of the financial year to the date of this report are:

Dato’ Ir. Goh Nai Kooi @ Gah Mai KwaiDato’ Ir. Dr. Goh Yong CheeTham Yen ThimIr. Boey Cheng HaiDato’ Abdul Rahman Bin AhmadTan Yen Yeow Lim Tze Ming

The names of the directors of the Company’s subsidiaries since the beginning of the financial year to the date of this report, excluding those who are already listed above are:

Datin Quah Saw GimNik Ahamad Shukri Bin Nik Abdul Majid

25


Directors' Report (cont’d)

Directors’ interest in shares

The shareholdings in the Ordinary Shares of the Company and of its related corporations (other than wholly-owned subsidiaries) of those who were directors at the end of the financial year, as recorded in Register of Director’s Shareholding kept by the Company under Section 59 of the Companies Act, 2016 in Malaysia were as follows:

Number of ordinary shares of RM1 eachBalance at Balance at

The Company 01.04.2016 Bought Sold 31.03.2017

Direct interest:Dato’ Ir. Dr. Goh Yong Chee 2,957,300 - - 2,957,300Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai 9,149,950 1,293,200 - 10,443,150Ir. Boey Cheng Hai 2,491,846 1,000,000 - 3,491,846Tham Yen Thim 334,000 - - 334,000

Indirect interest:= Dato’ Ir. Dr. Goh Yong Chee 65,393,877 - - 65,393,877+ Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai 70,157,877 40,000 - 70,197,877

Number of ordinary shares of RM1 eachJMR Consolidated Holdings Sdn. Bhd. Balance at Balance at(Holding Company) 01.04.2016 Bought Sold 31.03.2017

Direct interest:Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai 8,311,480 - - 8,311,480Dato’ Ir. Dr. Goh Yong Chee 1,575,783 - - 1,575,783

Indirect interest:+ Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai 65,106,298 40,000 - 65,146,298= Dato’ Ir. Dr. Goh Yong Chee 70,733,558 - - 70,733,558# Tham Yen Thim 5,736,477 - - 5,736,477

+ Deemed interest through corporate shareholders and his spouse and daughter.= Deemed interest through corporate shareholders and his spouse.# Deemed interest through corporate shareholders.

By virtue of their interests in the shares of the Company and the holding company, the directors mentioned above are also deemed to be interested in the shares of all the subsidiaries of the Company to the extent that the Company and the holding company respectively have an interest.

None of the other directors in office at the end of the financial year had any interest in shares of the Company and its related companies during the financial year.

26


2727


Directors’ benefits

Since the end of the previous financial year, no director of the Company has received nor become entitled to receive any benefit (other than a benefit included in the aggregate amount of emoluments received or due and receivable by directors as shown in the financial statements) by reason of a contract made by the Company or a related corporation with the directors or with a firm of which the director is a member, or with a company in which the director has a substantial financial interest other than as disclosed in Note 28 to the financial statements.

There were no arrangements during or at the end of the financial year, which had the object of enabling the directors to acquire benefits by means of the acquisition of shares in, or debentures of the Company or any other body corporate.

Indemnity and insurance for directors and officers

There was no indemnity given to or insurance effected for any director, officer and auditor of the Group and of the Company.

Issue of shares and debentures

There were no changes in the share capital of the Company during the financial year.

On 31 January 2017, the Companies Act, 2016 became effective and rendered the par value regime no longer applicable. This has resulted in the Company’s share capital no longer having a par value and the authorised share capital no longer relevant at the date of the report.

There were no debentures issued during the financial year.

Options granted over unissued shares

No options were granted to any person to take up unissued shares of the Company during the financial year.

Other statutory information Before the financial statements of the Group and of the Company were made out, the Directors took reasonable steps to ascertain that:

(i) proper action had been taken in relation to the writing off of bad debts and the making of provision for doubtful debts and have satisfied themselves that there are no known bad debts and that adequate provision had been made for doubtful debts; and

(ii) any current assets which were unlikely to be realised in the ordinary course of business have been written down to an amount which they might be expected so to realise.

At the date of this report, the Directors are not aware of any circumstances:

(i) which would necessitate the writing off of bad debts or render the amount of the provision for doubtful debts inadequate to any material extent; or

(ii) which would render the value attributed to current assets in the financial statements of the Group and of the Company misleading; or

(iii) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate; or

(iv) not otherwise dealt with in this report or the financial statements, which would render any amount stated in the financial statements of the Group and of the Company misleading.

27



Other statutory information (continued)

At the date of this report, there does not exist:

(i) any charge on the assets of the Group and of the Company that has arisen since the end of the financial year and which secures the liabilities of any other person; or

(ii) any contingent liability in respect of the Group and of the Company that has arisen since the end of the financial year.

No contingent liability or other liability of the Group and of the Company has become enforceable, or is likely to become enforceable within the period of twelve months after the end of the financial year which, in the opinion of the Directors, will or may substantially affect the ability of the Group and of the Company to meet their obligations as and when they fall due. In the opinion of the Directors, the financial performance of the Group and of the Company for the financial year ended 31 March 2017 have not been substantially affected by any item, transaction or event of a material and unusual nature nor has any such item, transaction or event occurred in the interval between the end of the financial year and the date of this report.

Holding company

The Directors regard JMR Consolidated Holdings Sdn. Bhd., a company incorporated in Malaysia, as the holding company.

Auditors The amount paid as remuneration to the auditors, Messrs PKF, for the financial year ended 31 March 2017 is as disclosed in Note 6 to financial statements.

The auditors have indicated their willingness to continue in office.

Signed on behalf of the Directorsin accordance with a resolution of the Board,

DATO’ IR. GOH NAI KOOI @ GAH MAI KWAI THAM YEN THIM

Penang

18 July 2017

28


2929

Statement By DirectorsPursuant To Section 251 (2) Of The Companies Act, 2016 in Malaysia

In the opinion of the Directors, the accompanying financial statements as set out on pages 34 to 93 are drawn up in accordance with Financial Reporting Standards andthe Companies Act, 2016 in Malaysia, so as to give a true and fair view of the financial position of the Group and of the Company as at 31 March 2017 and of their financial performance and their cash flows for the financial year ended on that date.

The supplementary information as set out in Note 34 to the financial statements is disclosed to meet the requirement of Bursa Malaysia Securities Berhad. The Directors are responsible for the preparation of the supplementary information in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants (“MIA Guidance”) and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared, in all material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.

Signed on behalf of the Directorsin accordance with a resolution of the Board,

DATO’ IR. GOH NAI KOOI @ GAH MAI KWAI THAM YEN THIM

Penang

18 July 2017

Statutory DeclarationPursuant To Section 251 (1)(b) Of The Companies Act, 2016 in Malaysia

I, DATO’ IR. DR. GOH YONG CHEE, being the director primarily responsible for the financial management of JMR CONGLOMERATION BHD., do solemnly and sincerely declare that to the best of my knowledge and belief, the financial statements as set out on pages 34 to 93 are in my opinion correct, and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960.

Subscribed and solemnly declared by the above named at GEORGETOWN in the State of PENANG on 18 July 2017

)))

DATO’ IR. DR. GOH YONG CHEE

Before me,

COMMISSIONER FOR OATHS

29


Independent Auditors’ ReportTo the members of JMR Conglomeration Bhd. and its Subsidiaries

REPORT ON THE FINANCIAL STATEMENTS

Opinion

We have audited the financial statements of JMR Conglomeration Bhd., which comprise the statements of financial position as at 31 March 2017 of the Group and of the Company, and the statements of comprehensive income, statements of changes in equity and statements of cash flows of the Group and of the Company for the financial year then ended, and notes to the financial statements, including a summary of significant accounting policies, as set out on pages 34 to 93.

In our opinion, the accompanying financial statements give a true and fair view of the financial position of the Group and of the Company as at 31 March 2017, and of their financial performance and their cash flows for the financial year then ended in accordance with Financial Reporting Standards and the requirements of the Companies Act, 2016 in Malaysia.

Basis for Opinion

We conducted our audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing. Our responsibilities under those standards are further described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Group and of the Company in accordance with the By-Laws (on Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants (“By-Laws”) and the International Ethics Standards Board for Accountants’ Code of Ethics for Professional Accountants (“IESBA Code”), and we have fulfilled our other ethical responsibilities in accordance with the By-Laws and the IESBA Code.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key Audit Matters

Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial statements of the Group and of the Company for the current year. These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.

Valuation of development property inventories(Refer to Note 18 to the financial statements)

The Group has significant residential development properties held for sale as its inventories. These inventories are stated at the lower of their cost and their net realisable values. As at 31 March 2017, developed property inventories stated at cost amounted to RM27,457,921 and at net realisable value at RM560,000.

Given the prevailing weak sentiment in the residential and commercial property market in Malaysia arising from macroeconomic factors and a slowdown in economic activity in Malaysia, there is downward pressure on transaction volumes and residential and commercial property prices in this market. This could lead to future trends in this market departing from known trends based on past experience. There is therefore a risk that the estimates of net realisable values exceed future selling prices, resulting in more losses when inventories are sold. The determination of the estimated net realisable value of these development properties is critically dependent upon the Group’s expectations of future selling prices.

Our procedures included:

(a) Evaluating the reasonableness of the assumptions used by management to estimate the fair values by using comparison method that refers to market values of similar properties in the open market and selling price of sold units during the financial year.

(b) Testing the fair value of the inventories by referring to market values.

30


3131

Independent Auditors’ Report (cont’d)To the members of JMR Conglomeration Bhd. and its Subsidiaries

Information Other than the Financial Statements and Auditors’ Report Thereon

The Directors of the Company are responsible for the other information. The other information comprises the Chairman's Statement and Management Discussion and Analysis, Audit Committee Report, Statement on Corporate Governance, Statement on Risk Management and Internal Control and Directors’ Report but does not include the financial statements of the Group and of the Company and our auditors’ report thereon.

Our opinion on the financial statements of the Group and of the Company does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements of the Group and of the Company, our responsibility is to read the other information identified and, in doing so, consider whether the information is materially inconsistent with the financial statements of the Group and of the Company or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of the other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the Financial Statements

The Directors are responsible for the preparation of financial statements of the Group and of the Company that give a true and fair view in accordance with Financial Reporting Standards and the requirements of the Companies Act, 2016 in Malaysia. The Directors are also responsible for such internal control as the Directors determine are necessary to enable the preparation of financial statements of the Group and of the Company that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements of the Group and of the Company, the Directors are responsible for assessing the Group’s and Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Group or the Company or to cease operations, or have no realistic alternative but to do so.

Auditors’ Responsibilities for the Audit of the Financial Statements

Our objectives are to obtain reasonable assurance about whether the financial statements of the Group and of the Company as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors’ report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with approved standards on auditing in Malaysia and International Standards on Auditing will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

As part of an audit in accordance with approved standards on auditing in Malaysia and International Standards on Auditing, we exercise professional judgement and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements of the Group and of the Company, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s and of the Company’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Directors.

• Conclude on the appropriateness of the Directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s and the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditors’ report to the related disclosures in the financial statements of the Group and of the Company or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditors’ report. However, future events or conditions may cause the Group and the Company to cease to continue as a going concern.

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Auditors’ Responsibilities for the Audit of the Financial Statements (continued)

• Evaluate the overall presentation, structure and content of the financial statements of the Group and of the Company, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the financial statements of the Group. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with the Directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide the Directors with a statement that we have compiled with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with the Directors, we determine those matters that were of most significance in the audit of the financial statements of the Group and of the Company for the current year and are therefore the key audit matters. We describe these matters in our auditors’ report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Report on Other Legal and Regulatory Requirements

In accordance with the requirements of the Companies Act, 2016 in Malaysia we also report the following:

(a) In our opinion, the accounting and other records and the registers required by the Companies Act, 2016 in Malaysia to be kept by the Company and its subsidiaries, of which we have acted as auditors, have been properly kept in accordance with the provisions of the Act.

(b) We have considered the financial statements and the auditors’ reports of the subsidiaries as indicated in Note 15 to the financial statements, being financial statements which are included in the consolidated financial statements.

(c) We are satisfied that the financial statements of the subsidiaries that have been consolidated with the Company’s financial statements are in form and content appropriate and proper for the purposes of the preparation of the consolidated financial statements and we have received satisfactory information and explanations required by us for those purposes.

(d) The audit reports on the financial statements of the subsidiaries were not subject to any qualification or any adverse comment made under Section 261 of the Act.


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Other Reporting Responsibilities

The supplementary information set out in Note 34 to the financial statements is disclosed to meet the requirements of Bursa Malaysia Securities Berhad and is not part of the financial statements. The Directors are responsible for the preparation of the supplementary information in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants (“MIA Guidance”) and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is prepared, in all material respects, in accordance with the directive of Bursa Malaysia Securities Berhad.

Other matters

This report is made solely to the members of the Company, as a body, in accordance with Section 266 of the Companies Act, 2016 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

PKF BRIAN WONG WYE PONGAF 0911 02610/04/19 JCHARTERED ACCOUNTANTS CHARTERED ACCOUNTANT

Kuala Lumpur

18 July 2017


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The accompanying notes form an integral part of the financial statements.

Group Company2017 2016 2017 2016

Note RM RM RM RM

Revenue 3 24,019,360 29,516,814 - 2,600,000Cost of sales 4 (16,428,864) (17,941,773) - -

Gross profit 7,590,496 11,575,041 - 2,600,000Other income 586,541 1,449,693 700,844 -Administrative expenses (5,382,011) (6,910,488) (288,521) (427,629)Distribution costs (173,008) (66,574) - -Share of (loss)/profit of associates (183,538) 1,838,580 - -

Profit from operations 6 2,438,480 7,886,252 412,323 2,172,371Finance costs 7 (1,131,884) (959,600) - -

Profit before tax 1,306,596 6,926,652 412,323 2,172,371Tax expense 8 (491,604) (2,176,790) (83,259) (569,876)

Profit and total comprehensive income for the year 814,992 4,749,862 329,064 1,602,495

Profit for the year attributable to:Owners of the Company 814,215 4,741,971 329,064 1,602,495Non-controlling interests 777 7,891 - -

814,992 4,749,862 329,064 1,602,495

Total comprehensive income attributable to:Owners of the Company 814,215 4,741,971 329,064 1,602,495Non-controlling interests 777 7,891 - -

814,992 4,749,862 329,064 1,602,495

Earnings per share:Basic (sen per share) 9 0.64 3.74

Statements Of Comprehensive IncomeFor The Financial Year Ended 31 March 2017

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3535


Group Company2017 2016 2017 2016

Note RM RM RM RM

ASSETSNon-current assetsProperty, plant and equipment 10 18,169,186 25,393,544 - -Investment properties 11 20,370,068 13,505,406 3,676,000 3,676,000Prepaid lease payments on leasehold land 12 1,697,712 1,742,551 - -Land held for property development 13 31,043,969 32,860,949 - -Goodwill 14 592,354 592,354 - -Investments in subsidiaries 15 - - 84,546,837 84,296,837Investments in associates 16 713,385 896,925 559,769 559,769Trade and non-trade receivables 17 - - 24,472 2,423,951

72,586,674 74,991,729 88,807,078 90,956,557

Current assetsInventories 18 29,934,502 15,262,825 - -Property development costs 19 9,311,199 26,275,284 - -Trade and non-trade receivables 17 8,681,840 11,770,668 4,185,004 4,490,859Tax recoverable 2,267,505 2,087,979 - -Short term deposits with licensed banks 20 1,040,753 1,029,816 - -Cash and bank balances 21 2,093,901 3,412,910 97,737 263,943

53,329,700 59,839,482 4,282,741 4,754,802

TOTAL ASSETS 125,916,374 134,831,211 93,089,819 95,711,359

Statements Of Financial PositionAs At 31 March 2017

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Group Company2017 2016 2017 2016

Note RM RM RM RMEQUITY AND LIABILITIESEquity attributable to owners of the CompanyShare capital 22 126,784,397 126,784,397 126,784,397 126,784,397Accumulated losses (28,915,456) (25,922,839) (34,907,952) (31,433,484)

97,868,941 100,861,558 91,876,445 95,350,913Non-controlling interests 23 199,971 199,194 - -

TOTAL EQUITY 98,068,912 101,060,752 91,876,445 95,350,913

Non-current liabilitiesBorrowings 24 993,332 1,521,992 - -Deferred tax liabilities 25 704,991 785,688 - -

1,698,323 2,307,680 - -

Current liabilitiesTrade and non-trade payables 26 7,517,265 10,520,136 1,042,809 119,881Borrowings 24 18,432,982 20,677,215 - -Tax payable 198,892 265,428 170,565 240,565

26,149,139 31,462,779 1,213,374 360,446

TOTAL LIABILITIES 27,847,462 33,770,459 1,213,374 360,446

TOTAL EQUITY AND LIABILITIES 125,916,374 134,831,211 93,089,819 95,711,359

Statements Of Financial Position (cont’d)As At 31 March 2017

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3737


Attributable to equity holders of the Company Non-

distributable Distributable

NoteShare capital

Accumulated losses Total

Non-controlling interests Total

RM RM RM RM RMGroupAt 1 April 2015 126,784,397 (30,664,918) 96,119,479 130,082 96,249,561Profit for the financial year - 4,741,971 4,741,971 7,891 4,749,862Acquisition of subsidiary - - - 60,829 60,829Effect of change in stake of

investment in subsidiary - 108 108 392 500

At 31 March 2016 126,784,397 (25,922,839) 100,861,558 199,194 101,060,752Profit for the financial year - 814,215 814,215 777 814,992Dividends 27 - (3,803,532) (3,803,532) - (3,803,532)Effect of translation - (3,300) (3,300) - (3,300)

At 31 March 2017 126,784,397 (28,915,456) 97,868,941 199,971 98,068,912

Non-distributable Distributable

Sharecapital

Accumulatedlosses Total

Note RM RM RMCompanyAt 1 April 2015 126,784,397 (33,035,979) 93,748,418Profit for the financial year - 1,602,495 1,602,495At 31 March 2016 126,784,397 (31,433,484) 95,350,913Profit for the financial year - 329,064 329,064Dividends 27 - (3,803,532) (3,803,532)

At 31 March 2017 126,784,397 (34,907,952) 91,876,445

Statements Of Changes In EquityFor The Financial Year Ended 31 March 2017

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Statements Of Cash Flows For The Financial Year Ended 31 March 2017


Group Company2017 2016 2017 2016

Note RM RM RM RM

Cash flows from operating activitiesProfit before tax 1,306,596 6,926,652 412,323 2,172,371Adjustments for:Amortisation of prepaid lease payments on leasehold

land 44,839 44,838 - -Amortisation cost - - (700,844) 81,176Bad debts written off - 215,000 - -Depreciation of:- property, plant and equipment 330,925 301,770 - -- investment properties 126,434 124,897 - -Deposits forfeited - 5,000 - -Impairment loss on- trade receivables 24,968 1,039,853 - -- non-trade receivables - 9,000 - -Interest expense 1,131,886 959,600 - -Bargain purchase from acquisition of a subsidiary - (352,552) - -Property, plant and equipment written off 867 1,437 - -Gain on disposal of property, plant and equipment (4,000) - - -Gain on disposal of investment properties (330,410) - - -Share of loss/(profit) of associates 183,538 (1,838,580) - -Gross dividend income - - - (2,600,000)Interest income (105,994) (99,628) - -Reversal of impairment loss on - trade receivables - (23,000) - -- non-trade receivables (1,900) - - -Unrealised loss/(gain) on foreign exchange 7,909 7,282 323 (321)

Operating profit/(loss) before working capital changes 2,715,658 7,321,569 (288,198) (346,774)

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3939

Group Company2017 2016 2017 2016

Note RM RM RM RM

Operating profit/(loss) before working capital changes 2,715,658 7,321,569 (288,198) (346,774)

(Increase)/Decrease in inventories (14,671,677) 6,088,588 - -Decrease/(Increase)in property development costs 19,082,384 (16,257,769) - -Decrease/(Increase) in receivables 3,057,851 7,497,725 (10,504) -Decrease in payables (3,006,171) (12,486,101) (2,856) (4,737,945)Decrease in Housing and Development accounts 329,003 668,612 - -

Cash generated from/(used in) operations 7,507,048 (7,167,376) (301,558) (5,084,719)Interest received 3,127 10,683 - -Interest paid (993,121) (796,369) - -Tax refunded 608,442 1,874,170 - -Tax paid (1,426,805) (4,120,813) (153,259) (537,916)

Net cash from/(used in) operating activities 5,698,691 (10,199,705) (454,817) (5,622,635)

Cash flows from investing activitiesDividends received - 1,700,000 - 2,600,000Interest received 102,867 88,945 - -Proceeds from disposal of shares in a subsidiary - 500 - -Proceeds from disposal of investment properties 630,753 - - -Proceeds from disposal of property, plant and

equipment 4,000 - - -Payments for land held for property development (301,319) (235,830) - -Acquisition of an associate - (20,000) - -Acquisition of property, plant and equipment (398,873) (698,757) - -Increase in investment in subsidiary - - (250,000) -Net inflows/(outflows) in acquisition on subsidiaries - 35,087 - (11,998)Net advances from subsidiaries - - 4,342,143 2,764,426

Net cash from investing activities 37,428 869,945 4,092,143 5,352,428

Statements Of Cash Flows (cont’d)For The Financial Year Ended 31 March 2017


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Group Company2017 2016 2017 2016

Note RM RM RM RM

Cash flows from financing activitiesShort term deposits held as security (10,937) (110,607) - -Drawdown from borrowings - 1,800,000 - -Repayment of borrowings (770,569) (2,381,627) - -Dividend paid (3,803,532) - (3,803,532) -Interest paid (138,763) (163,231) - -

Net cash used in financing activities (4,723,801) (855,465) (3,803,532) -

Net increase/(decrease) in cash and cash equivalents 1,012,318 (10,185,225) (166,206) (270,207)

Cash and cash equivalents at 1 April 2016/2015 (17,031,064) (6,845,839) 263,943 534,150

Cash and cash equivalents at 31 March (i) (16,018,746) (17,031,064) 97,737 263,943

Notes: (i) Cash and cash equivalents

Cash and cash equivalents comprise the following:

Group Company2017 2016 2017 2016

Note RM RM RM RMCash and bank balances* 1,888,516 2,878,522 97,737 263,943Less: Bank overdrafts 24 (17,907,262) (19,909,586) - -

(16,018,746) (17,031,064) 97,737 263,943

* Net off bank balance under Housing and Development accounts (Note 21)

Statements Of Cash Flows (cont’d)For The Financial Year Ended 31 March 2017


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4141

1. Basis of preparation

The financial statements of the Group and of the Company have been prepared in accordance with Financial Reporting Standards (“FRSs”) and the requirements of the Companies Act, 2016 in Malaysia.

The accompanying financial statements have been prepared assuming that the Group and the Company will continue as going concerns which contemplates the realisation of assets and settlement of liabilities in the normal course of business.

The financial statements are presented in the Ringgit Malaysia (“RM”), which is the Company’s functional and presentation currency.

(a) Standards issued and effective

On 1 April 2016, the Company has also adopted the following new and amended FRSs which are mandatory for annual financial periods beginning on or after 1 April 2016.

Description

Effective for annual periods

beginning on or after

• Annual improvements to FRSs 2012 - 2014 cycle, - Amendments to FRS 5, Non-current Assets Held for Sale and Discontinued operations 1 January 2016- Amendments to FRS 7, Financial Instruments: Disclosures 1 January 2016- Amendments to FRS 119, Employee Benefits 1 January 2016- Amendments to FRS 134, Interim Financial Reporting 1 January 2016

• FRS 14, Regulatory Deferral Accounts 1 January 2016• Amendments to FRS 10, Consolidated Financial Statements: Investment Entities - Applying the

Consolidation Exception 1 January 2016• Amendments to FRS 11, Joint Arrangements: Accounting for Acquisitions of Interest in Joint

Operations 1 January 2016• Amendments to FRS 12, Disclosure of Interest in Other Entities: Investment Entities - Applying

the Consolidation Exception 1 January 2016• Amendments to FRS 101, Presentation of Financial Statements: Disclosure Initiative 1 January 2016• Amendments to FRS 116, Property, Plant and Equipment: Clarification of Acceptable Methods of

Depreciation and Amortisation 1 January 2016• Amendments to FRS 128, Investment in Associates: Investment Entities - Applying the

Consolidation Exception 1 January 2016• Amendments to FRS 138, Intangible Assets: Clarification of Acceptable Methods of Depreciation

and Amortisation 1 January 2016• Amendments to FRS 127, Separate Financial Statements: Equity Method in Separate Financial

Statements 1 January 2016

The Directors expect that the adoption of the new and amended FRSs above will have no impact on the financial statements of the Company.

Notes To The Financial StatementsFor The Financial Year Ended 31 March 2017

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1. Basis of preparation (continued)

(b) Standards issued but not yet effective

The Company has not adopted the following standards and interpretations that have been issued but not yet effective:

Description

Effective for annual periods

beginning on or after

• Annual improvements to FRSs 2014 - 2016 cycle, - Amendments to FRS 1, First-time Adoption of Financial Reporting Standards 1 January 2018- Amendments to FRS 12, Disclosure of Interests in Other Entities 1 January 2017- Amendments to FRS 128, Investment in Associates and Joint Ventures 1 January 2018

• Amendments to FRS 107, Statement of Cash Flows: Disclosure Initiative 1 January 2017• Amendments to FRS 112, Income Taxes: Recognition of Deferred Tax for Unrealised Losses 1 January 2017• FRS 9, Financial Instruments 1 January 2018• Amendments to FRS 10, Consolidated Financial Statements: Sale or Contribution of Assets

between an Investor and its Associate or Joint Venture Deferred• Amendments to FRS 128, Investment in Associates: Sale or Contribution of Assets between an

Investor and its Associate or Joint Venture Deferred• Amendments to FRS 2, Share-based Payment: Classification and Measurement of Share-based

Payment Transactions 1 January 2018• Amendments to FRS 4, Insurance Contracts: Applying FRS 9, Financial Instruments with FRS 4

Insurance Contracts 1 January 2018• Amendments to FRS 140, Investment Property: Transfer of Investment Property 1 January 2018• IC Interpretations 22, Foreign Currency Transactions and Advance Consideration 1 January 2018

The initial adoption of the accounting standards, amendments or IC Interpretations above will have no material impacts on the financial statements of the Company.

Malaysian Financial Reporting Standards (MFRS Framework)

The MFRS Framework is to be applied by all Entities Other Than Private Entities for annual periods beginning on or after 1 January 2012, with the exception of entities that are within the scope of MFRS 141 Agriculture and IC Interpretation 15, Agreements for Construction of Real Estate (“IC 15”), including its parent, significant investor and venturer (herein referred as “Transitioning Entities”).

Based on the MASB announcement on 28 October 2015, Transitioning Entities will be allowed to defer the adoption of the new MFRS Framework to 1 January 2018. Consequently, the adoption of the MFRS Framework by Transitioning Entities will be mandatory for annual periods beginning on or after 1 January 2018.

(c) Basis of measurement

The financial statements have been prepared on the historical cost basis other than as disclosed in Note 2 to the financial statements.

Notes To The Financial Statements (cont’d)For The Financial Year Ended 31 March 2017

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4343


(d) Critical accounting estimates and judgements

Estimates and judgements are continually evaluated by the Directors and management and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The estimates and judgements that affect the application of the Group’s and of the Company’s accounting policies and disclosures, and have a significant risk of causing a material adjustment to the carrying amounts of assets, liabilities, income and expenses are discussed below:

(i) Income Taxes

There are certain transactions and computations for which the ultimate tax determination may be different from the initial estimate. The Group and the Company recognise tax liabilities based on its understanding of the prevailing tax laws and estimates of whether such taxes will be due in the ordinary course of business. Where the final outcome of these matters is different from the amounts that were initially recognised, such difference will impact the income tax and deferred tax provisions in the year in which such determination is made.

(ii) Depreciation of Property, Plant and Equipment

The estimates for the residual values, useful lives and related depreciation charges for the property, plant and equipment and investment properties are based on commercial and production factors which could change significantly as a result of technical innovations and competitors’ actions in response to the market conditions.

The Group and the Company anticipate that the residual values of its property, plant and equipment will be insignificant. As a result, residual values are not being taken into consideration for the computation of the depreciable amount.

Changes in the expected level of usage and technological development could impact the economic useful lives and the residual values of these assets, therefore future depreciation charges could be revised.

(iii) Impairment of Non-financial Assets

When the recoverable amount of an asset is determined based on the estimated value in use of the cash-generating unit to which the asset is allocated, the management is required to make an estimate of the expected future cash flows from the cash-generating unit and also to apply a suitable discount rate in order to determine the present value of those cash flows.

(iv) Allowance for Inventories

Reviews are made periodically by management on damaged, obsolete and slow moving inventories. These reviews require judgement and estimates. Possible changes in these estimates could result in revisions to the valuation of inventories.

(v) Impairment of Trade and Non-trade Receivables

An impairment loss is recognised when there is an objective evidence that a financial asset is impaired. Management specifically reviews its trade and non-trade receivables and analyses its historical bad debts, customer concentrations, customer creditworthiness, current economic trends and changes in the customer payment terms when making a judgement to evaluate the adequacy of the impairment losses. Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated based on historical loss experience for assets with similar credit risk characteristics. If the expectation is different from the estimation, such difference will impact the carrying value of receivables.


43



(d) Critical accounting estimates and judgements (continued)

(vi) Deferred Tax Assets and Liabilities

Deferred tax implications arising from the changes in corporate income tax rates are measured with reference to the estimated realisation and settlement of temporary differences in the future periods in which the tax rates are expected to apply, based on the tax rates enacted or substantively enacted at the reporting date. While management’s estimates on the realisation and settlement of temporary differences are based on the available information at the reporting date, changes in business strategy, future operating performance and other factors could potentially impact on the actual timing and amount of temporary differences realised and settled. Any difference between the actual amount and the estimated amount would be recognised in the profit or loss in the period in which actual realisation and settlement occurs.

(vii) Construction Contracts

The Group recognises contract revenue and contract costs as revenue and expenses respectively in the statement of comprehensive income by using the stage of completion method. The stage of completion is determined by reference to the proportion of contract cost incurred for work performed to date to the estimated total contract costs.

Significant judgement is required in determining the stage of completion, the extent of the contract cost incurred, the estimated total contract revenue and costs, as well as the recoverability of the construction contracts. In making the judgement, the Group evaluates based on past experience and by relying on the work of specialists.

(viii) Classification between Investment Properties and Owner Occupied Properties

The Group and the Company determines whether a property qualifies as an investment property, and has developed criteria in making that judgement. Investment property is a property held to earn rentals or for capital appreciation or both. Therefore, the Group and the Company considers whether a property generates cash flows largely independent of the other assets held by the Group and the Company.

Some properties comprise a portion that is held to earn rentals or for capital appreciation and another portion that is held for use in the production or supply of goods or services or for administrative purposes. If these portions could be sold separately (or leased out separately under a finance lease), the Group and the Company accounts for the portions separately. If the portions could not be sold separately, the property is an investment property only if an insignificant portion is held for use in the production or supply of goods or services or for administrative purposes.

Judgement is made on an individual property basis to determine whether ancillary services are so significant that a property does not qualify as investment property.

(ix) Impairment of Goodwill

Goodwill is tested for impairment annually and at other times when such indicators exist. This requires management to estimate the expected future cash flows of the cash-generating units to which goodwill is allocated and to apply a suitable discount rate in order to determine the present value of those cash flows. The future cash flows are most sensitive to budgeted gross margins, growth rates estimated and discount rate used. If the expectation is different from the estimation, such difference will impact the carrying value of goodwill.

(x) Carrying Amount of Investment in Subsidiaries

Investments in subsidiaries are reviewed for impairment annually in accordance with its accounting policy as disclosed in Note 2(h)(ii) to the financial statements, or whenever events or changes in circumstances indicate that the carrying values may not be recoverable.

Significant judgement is required in the estimation of the present value of future cash flows generated by the subsidiaries, which involves uncertainties and are significantly affected by assumptions and judgements made regarding estimates of future cash flows and discount rates. Changes in assumptions could significantly affect the carrying value of investments in subsidiaries.


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4545


(d) Critical accounting estimates and judgements (continued)

(xi) Property Development

The Group recognises property development revenue in the statements of comprehensive income by using the stage of completion method. The stage of completion is determined by reference to the proportion of contract cost incurred for work performed to date to the estimated total property development costs.

Significant judgement is required in determining the stage of completion, the extent of the property development cost incurred, the estimated total property development revenue and costs, as well as the recoverability of the development projects. In making the judgement, the Group evaluates based on past experience and by relying on the work of specialists. Detailed property development costs are disclosed in Note 19 to the financial statements.

2. Summary of significant accounting policies

(a) Basis of consolidation

(i) Subsidiaries

Subsidiaries are entities, including structured entities, controlled by the Company. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

The Group adopted FRS 10, Consolidated Financial Statements in the current financial year. This resulted in changes to the following policies:

(i) Control exists when the Group is exposed, or has rights, to variable returns from its involvement with the entity and has ability to affect those returns through its power over the entity. In the previous financial years, control exists when the Group has the ability to exercise its power to govern the financial and operating policies of an entity so as to obtain benefits from its activities.

(ii) Potential voting rights are considered when assessing control only when such rights are substantive. In the previous financial years, potential voting rights are considered when assessing control when such rights are presently exercisable.

(iii) The Group considers it has de facto power over an investee when, despite not having the majority voting rights, it has the current ability to direct the activities of the investee that significantly affect the investee’s return. In the previous financial years, the Group did not consider de facto power in its assessment of control.

The adoption of FRS 10 has no significant impact to the financial statements of the Group.

Business combinations are accounted for using the acquisition method on the acquisition date. The consideration transferred includes the fair value of assets transferred, equity interest issued by the Group and liabilities assumed. Identifiable assets acquired, liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date.

The Group recognises any non-controlling interest in the acquiree on an acquisition-by-acquisition basis, either at fair value or at the non-controlling interest’s proportionate share of the recognised amounts of the acquiree’s identifiable net assets.

Acquisition-related costs are recognised in the profit or loss as incurred.

The excess of the consideration transferred, the amount of any non-controlling interests in the acquiree and the acquisition-date fair value of any previous equity interest in the acquiree over the fair value of the identifiable net assets acquired is recognised as goodwill. If the total of consideration transferred, non-controlling interest recognised and previously held interest measured is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase, the difference is recognised directly in profit or loss.


45


2. Summary of significant accounting policies (continued)

(a) Basis of consolidation (continued)

(ii) Accounting for business combinations

The consolidated financial statements comprise the financial statements of the Company and its subsidiaries as at the reporting date. A subsidiary is consolidated from the date of acquisition, being the date on which the Company obtains control, and continues to be consolidated until the date that such control ceases.

The financial statements of the subsidiaries used in the preparation of the consolidated financial statements are prepared for the same reporting date as the Company. Consistent accounting policies are applied to like transactions and events in similar circumstances.

Acquisitions of subsidiaries are accounted for by applying the acquisition method.

The Group has changed its accounting policy with respect to accounting for business combinations.

From 1 July 2012, the Group has applied Revised FRS 3, Business Combinations, in accounting for business combinations.

Acquisitions on or after 1 July 2012

For acquisitions on or after 1 July 2012, the Group measures goodwill at the acquisition date as:

• The fair value of the consideration transferred; plus• The recognised amount of any non-controlling interests in the acquiree; plus• If the business combination is achieved in stages, the fair value of the existing equity interest in the acquiree;

less• The net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed.

When excess is negative, a bargain purchase gain is recognised immediately in profit or loss.

The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts are generally recognised in profit or loss.

Cost related to the acquisition, other than those associated with the issue of debt or equity securities, that the Group incurs in connection with a business combination are expensed as incurred.

Any contingent consideration payable is recognised at fair value at the acquisition date. If the contingent consideration is classified as equity, it is not remeasured and settlement is accounted for within equity. Otherwise, subsequent changes to the fair value of the contingent consideration are recognised in profit or loss.

When share-based payment awards (replacement awards) are required to be exchanged for awards held by the acquiree’s employees (acquiree’s awards) and relate to past services, then all or a portion of the amount of the acquirer’s replacement awards is included in measuring the consideration transferred in the business combination. This determination is based on the market-based value of the replacement awards compared with the market-based value of the acquiree’s awards and the extent to which the replacement awards relate to past and / or future service.

Acquisitions before 1 July 2012

As part of its transition to MFRSs, the Group elected not to restate those business combinations that occurred before the date of transition to MFRSs, i.e. 1 July 2011. Goodwill arising from acquisitions before 1 July 2011 has been carried forward from the previous FRS framework as at the date of transition.

Acquisitions between 1 July 2006 to 1 July 2011

Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Adjustments to those fair values relating to previously held interests are treated as a revaluation and recognised in other comprehensive income.


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(ii) Accounting for business combinations (continued)

Acquisitions between 1 July 2006 to 1 July 2011 (continued)

The cost of a business combination is measured as the aggregate of the fair values, at the date of exchange, of the assets given, liabilities incurred or assumed, and equity instruments issued, plus any costs directly attributable to the business combination.

Any excess of the cost of business combination over the Group’s share in the net fair value of the acquired subsidiary’s identifiable assets, liabilities and contingent liabilities is recorded as goodwill on the statements of financial position. Any excess of the Group’s share in the net fair value of the acquired subsidiary’s identifiable assets, liabilities and contingent liabilities over the cost of business combination is recognised as income in profit or loss on the date of acquisition.

When the Group acquires a business, embedded derivatives separated from the host contract by the acquiree are reassessed on acquisition unless the business combination results in a change in the terms of the contract that significantly modifies the cash flows that would otherwise be required under the contract.

Acquisitions prior to 1 July 2006

For acquisitions prior to 1 July 2006, goodwill represents the excess of the cost of the acquisition over the Group’s interest in the fair values of the net identifiable assets and liabilities.

(iii) Non-controlling interests

Non-controlling interests at the end of the reporting period, being the equity in a subsidiary not attributable directly or indirectly to the equity holders of the Company, are presented in the consolidated statement of financial position and statement of changes in equity within equity, separately from equity attributable to the owners of the Company. Non-controlling interests in the results of the Group is presented in the consolidated statement of profit or loss and other comprehensive income as an allocation of the profit and loss and the other comprehensive income for the year between non-controlling interests and the owners of the Company.

The Group applied Revised FRS 127, Consolidated and Separate Financial Statements since the beginning of the reporting period.

Losses applicable to the non-controlling interests in a subsidiary are allocated to the non-controlling interests even if doing so caused the non-controlling interests to have a deficit balance.

In the previous years, where losses applicable to the non-controlling interests exceed their interests in the equity of a subsidiary, the excess, and any further losses applicable to the non-controlling interests, were charged against the Group’s interest except to the extent that the non-controlling interests had a binding obligation to, and was able to, make additional investment to cover the losses. If the subsidiary subsequently reported profits, the Group’s interest was allocated with all such profits until the non-controlling interests’ share of losses previously absorbed by the Group had been recovered.

(iv) Transactions with Non-controlling interests

Transactions with non-controlling interests are accounted for using the entity concept method, whereby, transactions with non-controlling interests are accounted for as transactions with owners.

On acquisition of non-controlling interest, the difference between the consideration and the Group’s share of the net assets acquired is recognised directly in equity. Gain or loss on disposal to non-controlling interests is recognised directly in equity.


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(v) Loss of control

The Group applied Revised FRS 127, Consolidated and Separate Financial Statements since 1 January 2014.

Upon the loss of control of a subsidiary, the Group derecognises the assets and liabilities of the subsidiary, any non-controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss of control is recognised in the profit or loss. If the Group retains any interest in the previous subsidiary, then such interest is measured at fair value at the date that control is lost. Subsequently it is accounted for as equity accounted investee or as an available-for-sale financial asset depending on the level of influence retained.

In the previous years, if the Group retained any interest in the previous subsidiary, such interest was measured at the carrying amount at the date that control was lost and their carrying amount would be regarded as cost on initial measurement of the investment.

(vi) Associate

An associate is an entity, not being a subsidiary or a joint venture, in which the Group has significant influence. An associate is equity accounted for from the date the Group obtains significant influence until the date the Group ceases to have significant influence over the associate.

The Group’s investments in associates are accounted for using the equity method. Under the equity method, the investment in associates are measured in the statement of financial position at cost plus post acquisition changes in the Group’s share of net assets of the associates. Goodwill relating to associates is included in the carrying amount of the investments. Any excess of the group’s share of the net fair value of the associates identifiable assets, liabilities and contingent liabilities over the cost of the investments is excluded from the carrying amount of the investments and is instead included as income in the determination of the Group’s share of the associates profit or loss for the period in which the investment is acquired.

When the Group’s share of losses in an associate equals or exceeds its interest in the associate, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associate.

After application of the equity method, the Group determines whether it is necessary to recognise an additional impairment loss on the Group investment in its associates. The Group determines at each reporting date whether there is any objective evidence that the investment in the associates is impaired. If this is the case, the Group calculates the amount of impairment as the difference between the recoverable amount of the associate and its carrying value and recognises the amount in profit or loss.

The financial statements of the associates are prepared as of the same reporting date as the company. Where necessary, adjustments are made to bring the accounting policies in line with those of the Group.

In the Company’s separate financial statements, investment in associates are stated at cost less impairment losses. On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is included in profit or loss.

(vii) Transactions eliminated on consolidation

Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group transactions, are eliminated in preparing the consolidated financial statements.

Unrealised gains arising from transactions with equity accounted associates are eliminated against the investment to the extent of the Group’s interest in the associates and jointly controlled entities. Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no evidence of impairment.


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(b) Revenue

Revenue represents the proportion of the total contract value attributable to the percentage of contract work performed and gross invoiced values of sale of goods and services rendered, less discounts.

Revenue is measured at the fair value of the consideration received or receivables. Revenue is reduced for estimated customer returns, rebates and other similar allowances.

(i) Sale of goods

Revenue from the sale of goods is recognised when all the following conditions have been satisfied:

• the Group has transferred to the buyer the significant risks and rewards of ownership of the goods;• the Group retains neither continuing managerial involvement to the degree usually associated with ownership

nor effective control over the goods sold;• the amount of revenue can be measured reliably;• it is probable that the economic benefits associated with the transaction will flow to the Group; and• the costs incurred or to be incurred in respect of the transaction can be measured reliably.

(ii) Income from property development projects and construction contracts

Income relating to property development projects is accounted for based on the percentage of completion method on development units that have been sold. The percentage of completion is determined based on cost incurred for work performed to date over the total estimated cost of the property development project. Sale of developed properties is recognised upon signing of the individual sale and purchase agreements. Income relating to construction contracts is recognised when the outcome of a construction contract can be estimated reliably, by reference to the stage of completion of the contract activity.

(iii) Rental income

Rental income from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term.

(iv) Dividend income

Dividend income is recognised when the shareholder’s right to receive payment is established.

(v) Interest income

Interest income is recognised on a time proportion basis that takes into account the principal outstanding and the effective rate over the period to maturity, when it is determined that such income will accrue to the Group.

(c) Employee benefits expenses

(i) Short term employee benefits

Wages, salaries, paid annual leave, bonuses and social security contributions are recognised as expenses in the financial year in which the associated services are rendered by employees of the Group and of the Company. Short term accumulating compensated absences such as paid annual leave are recognised when services are rendered by the employees that increase their entitlement to future compensated absences, and short term non-accumulating compensated absences such as sick leave are recognised when the absences occur.


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(c) Employee benefits expenses (continued)

(ii) Defined contribution plans

The Group and the Company’s contribution to defined contribution plans are charged to the profit or loss in the period to which they relate. Once the contribution have been paid, the Group and the Company have no further liability in respect of the defined contribution plans.

(d) Borrowing costs

Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sales.

All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

(e) Tax expense

(i) Current tax

Current tax is the amount of income taxes payable or recoverable in respect of the taxable profit or tax loss for a period. Current tax liability or assets for the current and prior periods shall be measured at the amount expected to be paid to, or recovered from, the tax authorities, using the tax rates (and tax laws) that have been enacted or substantially enacted at the end of the reporting period.

Current taxes are recognised in profit or loss except to the extent that the tax relates to items recognised outside profit or loss, either in other comprehensive income or directly in equity.

(ii) Deferred tax

Deferred tax is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements.

Deferred tax liabilities are recognised for all taxable temporary differences other than those that arise from goodwill or excess of the acquirer’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over the business combination costs or from the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction, affects neither accounting profit nor taxable profit.

Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused tax credits to the extent that it is probable that future taxable profits will be available against which the deductible temporary differences, unused tax losses and unused tax credits can be utilised.

Deferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled, based on the tax rates that have been enacted or substantively enacted at the end of the reporting period.

Deferred tax shall be recognised outside profit or loss if the tax relates to items that are recognised, in the same or different period, outside profit or loss. Deferred tax items are recognised in correlation to the underlying transactions either in other comprehensive income or directly in equity and deferred tax arising from a business combination is included in the resulting goodwill or excess of the acquirer’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities over the business combination cost.


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(f) Earnings per ordinary share

The Group presents basic and diluted earnings per share (“EPS”) data for its ordinary shares.

Basic EPS is calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period, adjusted for own shares held.

Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding, adjusted for own shares held, for the effects of all dilutive potential ordinary shares, which comprise convertible notes and share options granted to employees.

(g) Construction contracts

Where the outcome of a construction contract can be reliably estimated, contract revenue and contract costs are recognised as revenue and expenses respectively by using the stage of completion method. The stage of completion is measured by reference to the proportion of contract costs incurred for work performed to date to the estimated total contract costs.

Where the outcome of a construction contract cannot be estimated reliably, contract revenue is recognised to the extent of contract costs incurred that are likely to be recoverable. Contract costs are recognised as expense in the period in which they are incurred.

When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

Contract revenue comprises the initial amount of revenue agreed in the contract and variations in contract works to the extent that it is probable that they will result in revenue and they are capable of being reliably measured.

When the total of costs incurred on construction contracts plus recognised profits (less recognised losses) exceeds progress billings, the balance is classified as amount due from customers on contracts. When progress billings exceed costs incurred plus, recognised profits (less recognised losses), the balance is classified as amount due to customers on contracts.

(h) Impairment

(i) Impairment of financial assets

The Group and the Company assess at the end of each reporting period whether there is any objective evidence that a financial asset or group of financial assets measured at amortised cost is impaired. If any such evidence exists, the Group and the Company measure its impairment loss as the difference between the assets carrying amount and the present value of estimated future cash flows discounted at the financial asset’s original effective interest rate.

Objective evidence of impairment for a portfolio of receivables could include the Group’s and the Company’s past experience of collecting payments, an increase in the number of delayed payments in the portfolio past the average credit period and observable changes in national or local economic conditions that correlate with default on receivables.

The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables, where the carrying amount is reduced through the use of an impairment account. When a trade receivable becomes uncollectible, it is written off against the impairment account.

If in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed to the extent that the carrying amount of the asset does not exceed its amortised cost at the reversal date. The amount of such reversal is recognised in profit or loss.


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(h) Impairment (continued)

(ii) Impairment of non-financial assets

The Group and the Company assess at the end of each reporting period whether there is an indication that an asset may be impaired. If any such indication exists, the Group and the Company shall estimate the recoverable amount of the asset.

An asset’s recoverable amount is the higher of an asset’s fair value less costs to sell and its value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units (“CGUs”)).

In assessing value in use, the estimated future cash flows expected to be generated by the asset are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Where the carrying amount of an asset exceeds its recoverable amount, the asset is written down to its recoverable amount. Impairment losses recognised in respect of a CGU or groups of CGUs are allocated first to reduce the carrying amount of any goodwill allocated to those units or groups of units and then, to reduce the carrying amount of the other assets in the unit or groups of units on a pro-rata basis.

Impairment losses are recognised in profit or loss except for assets that are previously revalued where the revaluation was taken to other comprehensive income. In this case the impairment is also recognised in other comprehensive income up to the amount of any previous revaluation.

An assessment is made at the end of each reporting period as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased.

A previously recognised impairment loss for an asset other than goodwill is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was recognised. If that is the case, the carrying amount of the asset shall be increased to its recoverable amount. The increase cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised previously.

A reversal of an impairment loss for an asset other than goodwill shall be recognised immediately in profit or loss, unless the asset is carried at revalued amount.

(i) Property, plant and equipment

All items of property, plant and equipment are initially recorded at cost. The cost of an item of property, plant and equipment is recognised as an asset if, and only if, it is probable that future economic benefits associated with the item will flow to the Group and the Company and the cost of the item can be measured reliably.

Subsequent to the initial recognition, property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. When significant parts of property, plant and equipment are required to be replaced in intervals, the Group and the Company recognises such parts as individual assets with specific useful lives and depreciation, respectively. Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of the property, plant and equipment as a replacement if the recognition criteria are satisfied. All other repair and maintenance costs are recognised in profit or loss as incurred.

Freehold land has an undetermined useful life and therefore not depreciated.

Capital work-in-progress is not depreciated as these assets are not available for use. Depreciation will commence on these assets when they are ready for their intended use.


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(i) Property, plant and equipment (continued)

Depreciation of the other property, plant and equipment is provided for on a straight-line basis over the estimated useful lives of the assets, at the following annual rates:

Buildings 2%Leasehold improvement 33.33%Plant, machinery and equipment 10% - 20%Office equipment, furniture and fittings 10%Motor vehicles, tractors, road rollers and pavers 10% - 20%Electrical installation 10%Roadmarking equipment 10%

The carrying amount of property, plant and equipment are reviewed for impairment when events or changes in circumstances indicate that the carrying values may not be recoverable.

The residual value, useful life and depreciation method are reviewed at each financial year end, and adjusted prospectively, if appropriate.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal.

Any gain or loss on derecognition of the asset is included in the profit or loss in the year the asset is derecognised.

(j) Investment properties

Investment properties, which are properties held to earn rentals and/ or for capital appreciation (including property under construction for such purposes), are measured initially at its cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at cost less accumulated depreciation and any accumulated impairment losses. Freehold land is not depreciated and buildings are depreciated on a straight line basis to write down the cost of each building to their residual values over their estimated useful lives. The principal annual depreciation rates range from 1% to 2.2% per annum.

Investment properties are derecognised when either they have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gain or loss on the retirement or disposal of an investment property is recognised in profit or loss in the year of retirement or disposal.

The estimated useful lives, residual values and depreciation method of investment properties are reviewed at each year end, with the effect of any changes in estimates accounted for prospectively.

(k) Land held for property development

Land held for future property development consists of land where no development activities have been carried out or where development activities are not expected to be completed within the normal operating cycle. Such land is classified within non-current assets and is stated at cost less impairment losses, if any.

Land held for future property development will be reclassified for property development when significant development work has been undertaken and is expected to be completed within the normal operating cycle of two to three years.


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(l) Goodwill on consolidation

Goodwill is initially measured at cost. Following initial recognition, goodwill is measured at cost less accumulated impairment losses.

For the purpose of impairment testing, goodwill acquired is allocated, from the acquisition date, to each of the Group’s cash-generating units or groups of cash-generating units that are expected to benefit from the synergies of the combination.

The cash-generating unit to which goodwill has been allocated is tested for impairment annually and whenever there is an indication that the cash-generating unit may be impaired, by comparing the carrying amount of the cash-generating unit, including the allocated goodwill, with the recoverable amount of the cash-generating unit. Where the recoverable amount of the cash-generating unit is less than the carrying amount, an impairment loss is recognised in the profit or loss. Impairment losses recognised for goodwill are not reversed in subsequent periods.

Where goodwill forms part of a cash-generating unit and part of the operation within that cash-generating unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative fair values of the operations disposed of and the portion of the cash-generating unit retained.

Goodwill and fair value adjustments arising on the acquisition of foreign operation on or after 1 January 2006 are treated as assets and liabilities of the foreign operations and are recorded in the functional currency of the foreign operations and translated in accordance with the accounting policy set out in Note 2(a) to the financial statements.

Goodwill and fair value adjustments which arose on acquisitions of foreign operation before 1 January 2006 are deemed to be assets and liabilities of the Group and are recorded in RM at the rates prevailing at the date of acquisition.

(m) Financial assets

Financial assets are recognised in the statements of financial position when, and only when, the Group and the Company become a party to the contractual provisions of the financial instrument.

When financial assets are recognised initially, they are measured at fair value, plus, in the case of financial assets not at fair value through profit or loss, directly attributable transaction costs.

The Group and the Company determine the classification of their financial assets at initial recognition, and categorised as loans and receivables.

Loans and receivables

Financial assets that are non-derivative with fixed or determinable payments that are not quoted in an active market are classified as loans and receivables.

Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired, and through the amortisation process.

Loans and receivables are classified as current assets, except for those having maturity dates later than 12 months after the reporting date which are classified as non-current.

A financial asset is derecognised when the contractual right to receive cash flows from the asset has expired. On derecognition of a financial asset in its entirety, the difference between the carrying amount and the sum of the consideration received and any cumulative gain or loss that had been recognised in other comprehensive income is recognised in profit or loss.

Regular way purchases or sales are purchases or sales of financial assets that require delivery of assets within the period generally established by regulation or convention in the marketplace concerned. All regular way purchases and sales of financial assets are recognised or derecognised on the trade date i.e., the date that the Group and the Company commit to purchase or sell the asset.


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(n) Inventories

Inventories are stated at the lower of cost and net realisable value.

Cost of raw materials and finished goods are determined on the weighted average methods.

Cost of developed properties comprises costs of land, and related development and construction expenditure. Cost of raw materials, spare parts and roadmarking supplies consists of the original purchase price plus incidental cost of bringing the inventories to their present location and condition. Cost of finished goods consists of cost of raw materials, direct labour and an appropriate proportion of factory overheads.

Net realisable value represents the estimated selling price in the ordinary course of business less selling and distribution costs and all other estimated costs to completion.

(o) Property development activities

Revenue from property development is recognised using the percentage of completion method, by reference to the stage of completion of the property development projects at the end of the reporting period as measured by the proportion that development costs incurred for work performed to-date bear to the estimated total property development costs on completion.

When the outcome of a property development activity cannot be estimated reliably, property development revenue is recognised to the extent of property development costs incurred that is probable of recovery.

Any anticipated loss on a property development project (including costs to be incurred over the defects liability period), is recognised as an expense immediately.

Property development costs are classified as non-current asset where no development activities have been carried out or where development activities are not expected to be completed within the normal operating cycle.

Accrued billings represent the excess of property development revenue recognised in the profit or loss over the billings to purchasers while, progress billings represent the excess of billings to purchasers over property development revenue recognised in the profit or loss.

(p) Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and on hand, deposits with financial institution with original maturities of less than three months, highly liquid investments that are readily convertible to known amount of cash and which are subject to an insignificant risk of changes in value. For the purpose of the statement of cash flows, cash and cash equivalents are presented net of bank overdrafts and pledged deposits.

(q) Financial liabilities

Financial liabilities are classified according to the substance of the contractual arrangements entered into and the definitions of a financial liability.

Financial liabilities are recognised in the statements of financial position when, and only when, the Group and the Company become a party to the contractual provisions of the financial instrument. Financial liabilities are classified as other financial liabilities measured at amortised cost.

Other financial liabilities measured at amortised cost

The Group’s and the Company’s other financial liabilities include trade and non-trade payables and borrowings.

Trade and non-trade payables are recognised initially at fair value plus directly attributable transaction costs and are subsequently measured at amortised cost using the effective interest method.

Borrowings are recognised initially at fair value, net of transaction costs incurred, and subsequently measured at amortised cost using the effective interest method. Borrowings are classified as current liabilities unless the Group and the Company have an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.


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(q) Financial liabilities (continued)

For other financial liabilities, gains and losses are recognised in the profit or loss when the liabilities are derecognised, and through the amortisation process.

Financial guarantee contracts

Financial guarantee contracts issued by the Group and the Company are those contracts that require a payment to be made to reimburse the holder for a loss it incurs because the specified debtor fails to make a payment when due in accordance with the terms of a debt instrument. Subsequently, the liability is measured at the higher of the best estimate of the expenditure required to settle the present obligation at the reporting date and the amount recognised less cumulative amortisation.

A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in the statement of profit or loss.

(r) Leases

(i) Classification

A lease is recognised as a finance lease if it transfers substantially to the Group and the Company all the risks and rewards incidental to ownership. Leases of land and buildings are classified as operating or finance leases in the same way as leases of other assets and the land and buildings elements of a lease of land and buildings are considered separately for the purpose of lease classification. All leases that do not transfer substantially all the risks and rewards are classified as operating leases, with the following exceptions:

- Property held under operating leases that would otherwise meet the definition of an investment property is classified as an investment property, is accounted for as if held under a finance lease as described in Note 2(j) to the financial statements; and

- Land held for own use under an operating lease, the fair value of which cannot be measured separately from the fair value of a building situated thereon at the inception of the lease, is accounted for as being held under a finance lease, unless the building is also clearly held under an operating lease.

(ii) Finance Leases - the Group as Lessee

Assets acquired by way of hire purchase or finance leases are stated at an amount equal to the lower of their fair values and the present value of the minimum lease payments at the inception of the leases, less accumulated depreciation and impairment losses. The corresponding liability is in the statements of financial position as borrowings. In calculating the present value of the minimum lease payments, the discount factor used is the interest rate implicit in the lease, when it is practicable to determine; otherwise, the Group’s incremental borrowing rate is used. Any initial direct costs are also added to the carrying amounts of such assets.

Lease payments are apportioned between the finance costs and the reduction of the outstanding liability. Finance costs, which represent the difference between the total leasing commitments and the fair value of the assets acquired, are recognised as an expense in the profit or loss over the term of the relevant lease so as to produce a constant periodic rate of charge on the remaining balance of the obligations for each accounting period.

The depreciation policy for leased assets is in accordance with that for the depreciable property, plant and equipment as described in Note 2(i) to the financial statements.


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(r) Leases (continued)

(iii) Operating Leases - the Group as Lessee

Operating lease payments are recognised as an expense on a straight line basis over the term of the relevant lease. The aggregate benefit of incentives provided by the lessor is recognised as a reduction of rental expense over the lease term on a straight line basis.

In the case of a lease of land and buildings, the minimum lease payments or the up-front payments made are allocated, whenever necessary, between the land and the buildings element in proportion to the relative fair values for leasehold interests in the land element and buildings element of the lease at the inception of the lease. The up-front payment represents prepaid lease payments and are amortised on a straight line basis over the lease term.

(iv) Operating Leases - the Group as Lessor

Assets leased out under operating leases are presented in the statements of financial position according to the nature of the assets. Rental income from operating leases is recognised on a straight line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight line basis over the lease term.

(s) Provisions

A provision is recognised if, as a result of a past event, the Group and the Company have a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as finance cost.

(t) Contingencies

(i) Contingent liabilities

Where it is not probable that an outflow of economic benefits will be required, or the amount cannot be estimated reliably, the obligation is not recognised in the statements of financial position and is disclosed as a contingent liability, unless the probability of outflow of economic benefits is remote. Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events, are also disclosed as contingent liabilities unless the probability outflow of economic benefits is remote.

(ii) Contingent assets

Where it is not possible that there is an inflow of economic benefits, or the account cannot be estimated reliably, the asset is not recognised in the statement of financial position and it disclosed as contingent asset, unless the probability of inflow of economic benefits is remote. Possible obligations, whose existence will only be confirmed by the occurrence or non-occurrence of one or more future events, are also disclosed as contingent assets unless the probability of inflow of economic benefits is remote.

(u) Operating segment

For management purposes, the Group and the Company are organised into operating segments based on types of services. The management of the Group and of the Company regularly reviews the segment results in order to allocate resources to the segments and to assess the segment performance. Additional disclosures on each of these segments are shown in Note 31 to the financial statements, including the factors used to identify the reportable segments and the measurement basis of segment information.

(v) Equity instrument

An equity instrument is any contract that evidences a residual interest in the assets of the Group and of the Company after deducting all of its liabilities. Ordinary shares are recorded at the proceeds received, net of directly attributable incremental transaction costs. Dividends on ordinary shares are recognised from equity in the period in which they are declared.


57


3. Revenue

Group Company2017 2016 2017 2016RM RM RM RM

Sale of bituminous premix and quarry stone 10,496,640 17,285,274 - -Sale of developed properties 12,219,521 11,075,488 - -Paving and roadmarking services 848,367 753,447 - -Sale of tarmac and emulsion 51,114 39,815 - -Rental income 403,718 361,174 - -Interest on trust - 1,616 - -Gross dividend income - - - 2,600,000

24,019,360 29,516,814 - 2,600,000

4. Cost of sales

Group2017 2016RM RM

Cost of- materials sold 7,030,460 12,237,930- developed properties sold 8,591,093 5,082,704- paving and roadmarking services rendered 720,554 506,466- contract cost recognised 86,757 114,673

16,428,864 17,941,773


58


5959

5. Employee benefits expenses


(i) Staff costs- Salaries 1,727,697 1,633,431 - -- Contribution to defined contribution plan 210,550 204,929 - -- Social security contributions 23,292 19,710 - -- Other employee benefit expenses 107,048 50,473 - -

2,068,587 1,908,543 - -(ii) Directors’ remuneration

- Fees 83,000 83,000 83,000 83,000- Salaries and other emoluments 715,100 908,513 12,500 14,000- Contribution to defined contribution plan 64,578 87,618 - -- Social security contributions 1,362 2,200 - -

864,040 1,081,331 95,500 97,000

Total employee benefits expenses 2,932,627 2,989,874 95,500 97,000

(i) Executive directors:- Fees 27,000 18,000 27,000 18,000- Salaries and other emoluments 708,600 790,713 6,000 4,000- Contribution to defined contribution plan 64,578 74,682 - -- Social security contributions 1,362 1,580 - -

801,540 884,975 33,000 22,000(ii) Non-executive directors:

- Fees 56,000 65,000 56,000 65,000- Other emoluments 6,500 131,356 6,500 10,000

62,500 196,356 62,500 75,000

864,040 1,081,331 95,500 97,000


59


6. Profit from operations


Profit from operations is arrived at after charging/(crediting):

Amortisation of prepaid lease payments on leasehold land 44,839 44,838 - -Amortised cost adjustment on amount owing with

subsidiaries - - (700,844) 81,176Auditors’ remuneration:- current year 82,500 80,000 21,500 21,500- under provision in prior years - 1,000 - -Bad debts written off - 215,000 - -Depreciation of:- property, plant and equipment 330,925 301,770 - -- investment properties 126,434 124,897 - -Deposits forfeited - 5,000 - -Employee benefits expenses (Note 5) 2,932,627 2,989,874 95,500 97,000Hire of machinery and motor vehicles 108,341 125,153 - -Impairment loss on:- trade receivables 24,968 1,039,853 - -- non-trade receivables - 9,000 - -Property, plant and equipment written off 867 1,437 - -Rental of access road - 72,000 - -Rental of office and premises 285,000 285,000 - -(Gain)/Loss on foreign exchange:- realised - (722,090) - -- unrealised 7,909 7,282 323 (321)Interest income on:- other (3,127) (10,683) - -- short term deposits (102,867) (88,945) - -Bargain purchase from acquisition of a subsidiary - (352,552) - -Rental income (524,484) (500,652) - -Reversal of impairment loss on:- trade receivables - (23,000) - -- non-trade receivables (1,900) - - -Gain on disposal of:- investment properties (330,410) - - -- property, plant and equipment (4,000) - - -- quoted shares (165,744) - - -


60


6161

7. Finance costs

Group2017 2016RM RM

Interest expense on:- banker acceptances/invoice financing 2,364 63,387- short-term borrowings 138,763 163,231- bank overdraft interest 990,757 732,982

1,131,884 959,600

8. Tax expense


Current tax expense- current 292,890 712,653 - -- under provision in prior years: 279,411 1,478,719 83,259 569,876

572,301 2,191,372 83,259 569,876Deferred tax (Note 25)- current (79,479) (18,605) - -- (over)/under provision in prior years (1,218) 4,023 - -

(80,697) (14,582) - -

491,604 2,176,790 83,259 569,876

Reconciliation of effective tax rate:

Profit before tax 1,306,596 6,926,652 412,323 2,172,371

Tax calculated at statutory rate of 24% 313,583 1,662,396 98,957 521,369Non-deductible expenses 1,748,945 429,973 69,245 102,631Non-taxable income (1,816,679) (1,966,615) (168,202) (624,000)(Utilisation of deferred tax assets)/Net deferred tax assets

not recognised (29,239) 571,493 - -Crystallisation of deferred tax liabilities (3,199) (3,199) - -

213,411 694,048 - -Under/(Over) provision in prior years: - current 279,411 1,478,719 83,259 569,876 - deferred tax (1,218) 4,023 - -

491,604 2,176,790 83,259 569,876


61


8. Tax expense (continued)

The Group and the Company have unabsorbed capital allowances and unutilised tax losses available for set off against future taxable profits as follows:


Unabsorbed capital allowances 94,642 252,180 - -Unutilised tax losses 6,908,379 5,960,482 - -

7,003,021 6,212,662 - -

9. Earnings per share

Basic earnings per share is calculated by dividing profit for the year attributable to equity owners of the Company by the weighted average number of ordinary shares in issue during the financial year.

Group2017 2016

Profit for the financial year attributable to Equity holders of the Company (RM) 814,215 4,741,971

Weighted average number of ordinary shares in issue (units) 126,784,397 126,784,397

Basic earnings per share (sen) 0.64 3.74 There are no diluted earnings per share disclosed as there were no dilutive potential ordinary shares.


62


6363

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63


11. Investment properties


CostAt 1 April 2016/2015 14,664,549 14,664,549 3,676,000 3,676,000Disposal (337,913) - - -Transfer from property, plant and equipment 7,291,439 - - -

31 March 21,618,075 14,664,549 3,676,000 3,676,000

Accumulated depreciationAt 1 April 2016/2015 1,159,143 1,034,246 - -Charge for the year 126,434 124,897 - -Disposal (37,570) - - -

At 31 March 1,248,007 1,159,143 - -

Carrying amount 20,370,068 13,505,406 3,676,000 3,676,000

Fair value 33,953,000 25,690,000 4,500,000 4,500,000

The investment properties are as follows:


Freehold land 15,636,875 8,760,349 3,676,000 3,676,000Freehold land and buildings 4,733,193 4,745,057 - -

20,370,068 13,505,406 3,676,000 3,676,000

The following are recognised in profit or loss in respect of investment properties:


Rental income 403,718 356,074 - -Direct operating expenses (236,892) (110,823) (20,568) (16,810)

As of 31 March 2017, certain investment properties of the Group and of the Company with total carrying amount of RM8,101,582 (2016: RM8,101,582) and RM3,676,000 (2016: RM3,676,000) respectively are charged to local banks as security for banking facilities granted to the Group as mentioned in Note 24 to the financial statements.

The fair value disclosure for comparison has been determined based on valuations. Valuations of certain properties of the Group are performed by independent valuers and the fair value of remaining properties are estimated by the Directors based on the comparison method that refers to market values of similar properties in the open market.


64


6565

12. Prepaid lease payments on leasehold land

Group2017 2016RM RM

CostAt 1 April/31 March 2,001,729 2,001,729

AmortisationAt 1 April 2016/2015 259,178 214,340Amortisation during the year 44,839 44,838

At 31 March 304,017 259,178

Carrying amountAt 31 March 1,697,712 1,742,551

As at 31 March 2017, the unexpired lease period of the short leasehold lands are 32, 39 and 74 years (2016: 33, 40 and 75 years).

As at 31 March 2017, short leasehold land with a carrying amount of RM490,348 (2016: RM505,516) is charged to a local bank as security for banking facilities granted to the Group as mentioned in Note 24 to the financial statements.

As at 31 March 2017, the Group had a parcel of land which the land title held in trust under the name of a third party with a carrying amount of RM116,072 (2016: RM117,641).

13. Land held for property development

Group2017 2016RM RM

At 1 April 2016/2015 32,860,949 29,215,649Additions during the year 301,319 235,830Transfer from property development costs (Note 19) 124,507 3,470,450Transfer to property development costs (Note 19) (2,242,806) -Transfer to inventories - (60,980)

At 31 March 31,043,969 32,860,949

Represented by:Freehold land 23,353,955 25,553,351Development cost 7,690,014 7,307,598

31,043,969 32,860,949


65


14. Goodwill

Group2017 2016

Cost: RM RMAt 1 April/31 March 1,264,376 1,264,376

Less: Impairment lossAt 1 April/31 March (672,022) (672,022)

Carrying amount 592,354 592,354

Goodwill acquired in a business combination is allocated, at acquisition, to the cash-generating unit (“CGU”) that is expected to benefit from that business combination. The carrying amount of goodwill had been allocated to the following business segments as independent CGUs:

Group2017 2016RM RM

Construction and manufacturing 147,540 147,540Investment holding 415,164 415,164Property development 29,650 29,650

592,354 592,354 Goodwill is assessed annually for impairment or more frequently if there are indications that goodwill might be impaired.

15. Investment in subsidiaries

Company2017 2016RM RM

Unquoted shares, at cost 30,256,965 30,006,965Add: Amount owing by subsidiaries 54,289,872 54,289,872

84,546,837 84,296,837


66


6767

15. Investment in subsidiaries (continued)

The details of the subsidiaries, all of which are incorporated in Malaysia, are as follows:

EffectiveName of company: equity interest Principal activities

2017 2016JMR Manufacturing Sdn. Bhd. 100% 100% Manufacturing of asphalt premix, roadmarking

contractor and related road paving works

JMR Quarry (Kedah) Sdn. Bhd. 100% 100% Dormant

Lean Seng Chan (Quarry) Sdn. Bhd.* 100% 100% Operation of quarry

Link Lex (M) Sdn. Bhd. 100% 100% Property development

Rantronics Sdn. Bhd. 100% 100% Letting of properties

Great Marvel Sdn. Bhd.* 100% 100% Property development

JMR Resources Management Sdn. Bhd. 100% 100% Letting of properties and provision of management services

Multilight Sdn. Bhd. 100% 100% Investment holding, sales and services of goods and construction works

Sunnyside Landscape Sdn. Bhd. 100% 100% Investment holding

Great Marvel Development Sdn. Bhd. * 100% 100% Dormant

Tag Steel Holdings Sdn. Bhd. 86% 86% Dormant

Subsidiary of Link Lex (M) Sdn. Bhd.:Fook Lye Enterprises (M) Sdn. Bhd. 98.61% 98.61% Investment holding

The details of a subsidiary which is incorporated in United Kingdom, is as follows:

JCB (UK) Limited * 100% 100% Dormant

* The financial statements of these subsidiaries were audited by auditors other than the auditors of the Company.

Upon adoption of FRS 139, amounts owing by subsidiaries which are equity contributions in substance were recognised in the statement of financial position as equity investments. Consequently, all amounts owing by subsidiaries have been accounted for as deemed capital contributions by debiting the amounts to the cost of investment in subsidiaries account on that date.


67


15. Investment in subsidiaries (continued)

The amounts owing by subsidiaries represented as equity contributions in substance are as follows:


Great Marvel Sdn. Bhd. 42,210,129 42,210,129Sunnyside Landscape Sdn. Bhd. 4,060,000 4,060,000JMR Resources Management Sdn. Bhd. 1,691,743 1,691,743Link Lex (M) Sdn. Bhd. 3,848,000 3,848,000JMR Manufacturing Sdn. Bhd. 1,580,000 1,580,000Multilight Sdn. Bhd. 900,000 900,000

54,289,872 54,289,872

16. Investment in associates


Unquoted shares, at cost 1,613,918 1,613,918 648,918 648,918Share of post-acquisition results and reserves (900,533) 983,007 - -Less: Impairment loss - - (89,149) (89,149)Less: Dividend paid - (1,700,000) - -

713,385 896,925 559,769 559,769

Group2017 2016RM RM

Net carrying amount represented by:Share of net assets 1,390,250 1,573,790Goodwill on acquisition (676,865) (676,865)

713,385 896,925


68


6969

16. Investment in associates (continued)

Details of the Group’s associates, all of which are incorporated in Malaysia, are as follows:

Name of the Company: Equity interest Principal Activities2017 2016

Diligent Success Sdn. Bhd. (“DSSB”) 50% 50% Provision of marketing and consultancy services in relation to construction, engineering and related works

JMR-Hosna Bina Sdn. Bhd. (“JHBSB”) 50% 50% Contracting and subcontracting for road and engineering works

Associate of Rantronics Sdn. Bhd.:Nanometric Electronics Sdn. Bhd. (“NESB”) 50% 50% Manufacturing, assembling and installing of

electronics, computer components and other related products

Associate of JMR Quarry (Kedah) Sdn. Bhd.:

JML (Quarry) Sdn. Bhd (“JMLSB”) 20% 20% Quarry operator


69



Information of the Group’s associates, adjusted for any differences in accounting policies and reconciled to the carrying amount of the Group’s interest in the associate is as follows:

2017DSSB JHBSB NESB JMLSB Total

RM RM RM RM RMSummarised financial informationAs at 31 March Current assets 469,996 174,765 2,380,022 271,822 3,296,605Non-current assets - - 2,473 - 2,473Current liabilities (2,550) (1,325) (164,505) (467,762) (636,142)

Net assets/(liabilities) 467,446 173,440 2,217,990 (195,940) 2,662,936

Year ended 31 March Loss from continuing operations - - (21,364) - (21,364)Loss from discontinued operations (264,218) (6,490) - (187,510) (458,218)

Total comprehensive loss (264,218) (6,490) (21,364) (187,510) (479,582)

Included in the total comprehensive income are:

Revenue - - 753,789 - 753,789

Reconciliation of share of net assets to carrying amount

As at 31 March Group’s share of net assets 233,723 86,720 1,108,995 (39,188) 1,390,250Goodwill - - (695,490) 18,625 (676,865)

Carrying amount 233,723 86,720 413,505 (20,563) 713,385

Group’s share of resultsLoss from continuing operations - - (10,682) - (10,682)Loss from discontinued operations (132,109) (3,245) - (37,502) (172,856)

Total comprehensive loss (132,109) (3,245) (10,682) (37,502) (183,538)


70


7171


2016DSSB JHBSB NESB JMLSB Total

RM RM RM RM RMSummarised financial informationAs at 31 March Current assets 1,856,454 180,928 2,297,696 500,001 4,835,079Non-current assets - - 3,253 - 3,253Current liabilities (1,124,790) (1,000) (61,592) (508,431) (1,695,813)

Net assets/(liabilities) 731,664 179,928 2,239,357 (8,430) 3,142,519

Year ended 31 March Profit from continuing operations - - 322,880 - 322,880Loss from discontinued operations (8,502) (31,098) - (15,300) (54,900)

Total comprehensive (loss)/profit (8,502) (31,098) 322,880 (15,300) 267,980

Included in the total comprehensive income are:

Revenue - - 858,660 - 858,660

Reconciliation of share of net assets to carrying amount

As at 31 MarchGroup’s share of net assets 365,832 89,965 1,119,679 (1,686) 1,573,790Goodwill - - (695,490) 18,625 (676,865)

Carrying amount 365,832 89,965 424,189 16,939 896,925

Group’s share of resultsProfit from continuing operations - - 161,440 - 161,440Loss from discontinued operations (4,251) (15,549) - (3,060) (22,860)

Total comprehensive (loss)/profit (4,251) (15,549) 161,440 (3,060) 138,580

The financial year of two associates, DSSB and JHBSB ends on 31 August and is not coterminous with that of the Group. For the purpose of applying the equity method of accounting, the management accounts of the associates for the period/year ended 31 March 2017 have been used.


71


17. Trade and non-trade receivables


Non-current:Non-trade:Amount owing by subsidiaries - - 29,644 3,129,644Less: Amortised cost - - (5,172) (705,693)

- - 24,472 2,423,951

Current:Trade:Trade receivables 7,640,309 10,683,886 - -Less: ImpairmentAt 1 April 2016/2015 (1,095,973) (79,120) - -Addition during the year (24,968) (1,039,853) - -Reversal of impairment loss - 23,000 - -

At 31 March (1,120,941) (1,095,973) - -

6,519,368 9,587,913 - -Accrued income 779,113 778,038 - -

Sub-total trade 7,298,481 10,365,951 - -

Non-trade:Non-trade receivables 821,713 583,868 - -Less: ImpairmentAt 1 April 2016/2015 (9,600) - - -Reversal/(Addition) 1,900 (9,600) - -At 1 April/31 March (7,700) (9,600) - -

814,013 574,268 - -Amount owing by subsidiaries - - 4,170,000 4,486,359Deposits 494,293 155,736 4,500 4,500Prepayments 743,531 1,343,191 10,504 -

Less: ImpairmentAt 1 April/31 March (668,478) (668,478) - -

75,053 674,713 10,504 -

Sub-total non-trade 1,383,359 1,404,717 4,185,004 4,490,859

8,681,840 11,770,668 4,185,004 4,490,859


72


7373

17. Trade and non-trade receivables (continued)

(a) Trade receivables

Trade receivables comprise amounts receivable for the sale of goods, progress billings receivable and rendering of services.

The credit period granted by the Group ranges from 14 days to 60 days (2016: 14 days to 60 days). No interest is charged on trade receivables’ outstanding balances. Allowance for impairment is recognised against trade receivables over their respective credit period based on estimated irrecoverable amounts determined by reference to past default experience of the counterparty and an analysis of the counterparty’s current financial position.

(b) Amount owing by subsidiaries

The amount owing by subsidiaries are as follows:


Non-current:Multilight Sdn. Bhd. - 2,300,000JMR Manufacturing Sdn. Bhd. - 800,000JCB (UK) Limited 29,644 29,644

29,644 3,129,644Current:Tag Steel Holdings Sdn. Bhd. 4,070,000 4,070,000Link Lex (M) Sdn. Bhd. 100,000 100,000JMR Manufacturing Sdn. Bhd. - 300,000JMR Resources Management Sdn. Bhd. - 16,359

4,170,000 4,486,359 The non-current balances are unsecured advances which are interest free and repayable at the end of five years from 2015, net of amortised cost adjustments.

The current balances are unsecured advances which are interest free and repayable on demand.


73


18. Inventories

Group2017 2016RM RM

At cost:Developed properties 27,457,921 13,162,872Raw materials 1,724,812 695,275Finished goods 101,153 79,736Spare parts 90,616 64,942

29,374,502 14,002,825At net realisable value:Developed properties 560,000 1,260,000

29,934,502 15,262,825

19. Property development costs

Group2017 2016RM RM

At 1 April 2016/2015 39,185,034 19,693,969Additions during the year:- Freehold land (transfer from land held for property development) (Note 13) 2,242,806 -- Development costs incurred 4,969,964 22,961,515

46,397,804 42,655,484Transfer to:- Land held for development (Note 13) (124,507) (3,470,450)- Inventories (16,894,640) -Reversal of completed projects (20,067,458) -

9,311,199 39,185,034Cost recognised in profit and loss:At 1 April 2016/2015 (12,909,750) (6,206,004)Recognised during the year (7,157,708) (6,703,746)Reversal of completed projects 20,067,458 -

At 31 March - (12,909,750)

At 31 March 9,311,199 26,275,284


74


7575

19. Property development costs (continued)

Property development costs incurred during the year include the following charges:

Group2017 2016RM RM

Employee benefits expense 198,342 193,422

20. Short term deposits with licensed banks

As of 31 March 2017, the short term deposits with licensed banks of the Group carry interest at rates ranging from 2.75% to 3.15% (2016: 2.75% to 3.45%) per annum. The short term deposits are maturing in December 2017(2016: December 2016).

The short term deposits with licensed banks of the Group of RM1,040,753 (2016: RM1,029,816) are charged as security for banking facilities granted to the Group as mentioned in Note 24 to the financial statements.

21. Cash and bank balances

Included in cash and bank balances of the Group is an amount of RM205,385 (2016: RM534,388) representing bank balances under Housing and Development Accounts opened and maintained by a subsidiary as required under the Housing Developers (Housing Development Account) (Amendment) Regulation 2002.

22. Share capital

Group and Company2017 2016 2017 2016

Number of Ordinary Shares RM RM

Authorised:200,000,000 ordinary shares n/a 200,000,000* n/a 200,000,000

Issued and fully paid:126,784,397 ordinary shares 126,784,397 126,784,397* 126,784,397 126,784,397

* Par value of RM1 each

On 31 January 2017, the Companies Act, 2016 became effective and rendered the par value regime no longer applicable. This has resulted in the Company’s share capital no longer having par value and the authorised share capital no longer relevant at the date of the report.


75


23. Non-controlling interests

Non-controlling interests (“NCI”) in the Group represents that part of the net results of operations, or of net assets, of subsidiary attributable to shares and debentures, directly or indirectly other than by the Company or subsidiary.

The movement in non-controlling interests in subsidiary is as follows: Group

2017 2016RM RM

At 1 April 2016/2015 199,194 130,082Acquisition of new subsidiary - 60,829Changes in the equity portion - 392Share of results attributable to NCI 777 7,891

At 31 March 199,971 199,194

24. Borrowings

Group2017 2016

Note RM RMSecuredCurrentBankers’ acceptance/invoice financing (a) - 284,901Bank overdrafts (b) 17,907,262 19,909,586Term loans (c) 525,720 482,728

18,432,982 20,677,215Non-currentTerm loans (c) 993,332 1,521,992

19,426,314 22,199,207

(a) Bankers’ acceptance

As of 31 March 2017, the bankers’ acceptance bore average effective interest at a rate of 1.5% to 5.40% (2016: 1.5% to 5.40%) per annum and are secured by:

(i) legal charges over the land and buildings of the Group;(ii) charges over short-term deposits of the Group; and(iii) corporate guarantees from the Company.

(b) Bank overdrafts

The bank overdrafts of the Group bear interest at a rate of Base Lending Rate (“BLR”) + 1.5% per annum (2016: BLR + 1.5% per annum). The current BLR rate is 6.85% per annum. The bank facilities of the Group are secured by way of a 3rd party sixth legal charge over 14 parcels of land that include Grant No. 43499, Grant Mukim No. 312, 313, 535, 536, Grant No. 43498, Grant Mukim No. 537, 538, 539, 540, 654, 544, 545 & 546, Lot No. 1019, 1283, 1284, 1333, 1334, 1337, 1338, 1339, 1340, 1341, 1348, 1349, 1350, 1351 respectively, Mukim 12, Province Wellesley Centre, Penang.


76


7777

24. Borrowings (continued)

(c) Term loans

The remaining maturities of the term loans as at 31 March are as follows:

Group2017 2016RM RM

Within one year 525,720 482,728More than one year and less than five years 498,539 638,640Five years and more 494,793 883,352

1,519,052 2,004,720

The term loans of the Group bear interest at a rate of 7.85% (2016: 7.85%) per annum and are secured by the following:

(i) first party legal charge over certain property of the Group; and(ii) corporate guarantee by the Company.

25. Deferred tax liabilities

Group2017 2016RM RM

At 1 April 2016/2015 785,688 800,270Recognised in profit or loss (Note 8) (80,697) (14,582)

At 31 March 704,991 785,688

The components and movements of deferred tax assets and liability during the financial year are as follows:

Revaluation reserve

Property,plant and

equipment TotalRM RM RM

Deferred tax liabilities of the GroupAt 1 April 2016 648,778 210,306 859,084Recognised in profit or loss (9,579) (102,138) (111,717)

At 31 March 2017 639,199 108,168 747,367

At 1 April 2015 658,357 215,309 873,666Recognised in profit or loss (9,579) (5,003) (14,582)

At 31 March 2016 648,778 210,306 859,084


77


25. Deferred tax liabilities (continued)

Unabsorbed capital

allowanceUnutilised tax

losses TotalRM RM RM

Deferred tax assets of the GroupAt 1 April 2016 (7,250) (66,146) (73,396)Recognised in profit or loss 7,250 23,770 31,020

At 31 March 2017 - (42,376) (42,376)

At 1 April 2015 (7,250) (66,146) (73,396)Recognised in profit or loss - - -

At 31 March 2016 (7,250) (66,146) (73,396)

The amounts of temporary differences for which no deferred tax assets have been recognised in the statements of financial position are as follows:

Group2017 2016RM RM

Property, plant and equipment 307,050 (605,523)Unabsorbed capital allowance (94,642) (252,180)Unutilised tax losses (6,908,379) (5,960,482)

(6,695,971) (6,818,185)

26. Trade and non-trade payables


Current:Trade:Trade payables 2,654,871 4,610,067 - -Advance billing - 70,381 - -

Sub-total trade 2,654,871 4,680,448 - -

Non-trade:Non-trade payables 3,437,882 3,473,881 12,525 15,381Amount owing to subsidiaries - - 925,784 -Deposit received 231,562 20,000 - -Accrued expenses 1,192,950 2,345,807 104,500 104,500

Sub-total non-trade 4,862,394 5,839,688 1,042,809 119,881

7,517,265 10,520,136 1,042,809 119,881


78


7979

26. Trade and non-trade payables (continued)

Trade payables of the Group comprise amounts outstanding for trade purchases. The credit periods granted to the Group range from 14 days to 90 days (2016: 14 days to 90 days). No interest is charged on the trade payables’ outstanding balances. The Group has financial risk management policies in place to ensure that all the payables are paid within the pre-agreed credit terms.

(a) Amount owing to subsidiaries

The amount owing to subsidiaries are as follows:Company

2017 2016RM RM

Current:Great Marvel Sdn. Bhd. 400,000 -JMR Resources Management Sdn. Bhd. 75,784 -Multilight Sdn. Bhd. 450,000 -

925,784 -

(b) Non-trade payables and accured expenses

Non-trade payables and accured expenses comprise mainly amounts outstanding for ongoing costs.

27. Dividends

Gross dividend

per shareGross

dividendAmount of

dividend net of tax Date of paymentRM RM RM

2017Interim dividend 0.03 3,803,532 3,803,532 30 December 2016


79


28. Significant related party transactions

(a) The Company has related party transactions with the following companies:

2017 2016With subsidiaries: RM RM

JMR Resources Management Sdn. Bhd.- Management fee 24,998 26,101

Lean Seng Chan (Quarry) Sdn. Bhd.- Dividend received - 2,600,000

The significant balances with related parties are disclosed in Notes 17 and 26 to the financial statements.

The Directors are of the opinion that the transactions above have been entered into in the normal course of business and have been established on terms and conditions mutually agreed between the relevant parties.

(b) The remuneration of Directors during the financial year is disclosed in Note 5 to the financial statements.

29. Contingencies

Corporate guarantees to certain subsidiaries


Corporate guarantees given by the Company to local banks and third parties for credit facilities granted to certain subsidiaries 21,111,793 22,824,132

30. Operating lease arrangements

The Group has entered into operating lease agreements to lease out certain of its investment properties. The future minimum lease payments receivable under operating leases contracted for as of the reporting date but not recognised as receivables, are as follows:

Group2017 2016RM RM

Not later than one year 331,383 482,484Later than one year and not later than five years 49,800 -

381,183 482,484


80


8181

30. Operating lease arrangements (continued)

The Group has entered into operating lease agreements for the use of land, premises and road access. The future aggregate minimum lease payments under operating leases contracted for as of the reporting date but not recognised as liabilities are as follows:

Group2017 2016RM RM

Not later than one year 264,840 264,100Later than one year and not later than five years 248,780 -

513,620 264,100

31. Operating segments

Products and services from which reportable segments derive their revenue

The Group prepared the following segment information in accordance with FRS 8 Operating Segments based on the internal reports of the Group’s strategic business units which are regularly reviewed by the Group’s Chief Executive Officer (“CEO”) for the purpose of making decisions about resource allocation and performance assessment:

(i) Investment holding (included letting of properties);(ii) Manufacturing and trading of bituminous premix, tarmac, emulsion and operation of quarry;(iii) Construction; and(iv) Property development.


81


31.

Ope

ratin

g se

gmen

ts (c

ontin

ued)

Segm

ent r

even

ue a

nd re

sults

The

follo

win

g is

an

anal

ysis

of t

he G

roup

’s re

venu

e an

d re

sults

by

repo

rtabl

e se

gmen

ts:

Inve

stm

ent

Prop

erty

hold

ings

Man

ufac

turin

gC

onst

ruct

ion

deve

lopm

ent

Tota

lEl

imin

atio

nC

onso

lidat

edR

MR

MR

MR

MR

MR

MR

M

2017

:R

even

ueEx

tern

al re

venu

e40

3,71

811

,247

,723

148,

399

12,2

19,5

2124

,019

,360

-24

,019

,360

Inte

r-seg

men

t rev

enue

1,11

6,99

030

3,33

12,

236,

046

-3,

656,

367

(3,6

56,3

67)

-

Tota

l rev

enue

1,52

0,70

811

,551

,054

2,38

4,44

512

,219

,521

27,6

75,7

27(3

,656

,367

)24

,019

,360

Res

ults

Segm

ent (

loss

)/pro

fit(1

87,3

36)

1,46

8,65

7(1

,422

,366

)(5

37,9

56)

(679

,001

)2,

714,

478

2,03

5,47

7O

ther

inco

me

1,38

5,69

866

,596

4,60

118

4,93

41,

641,

829

(1,0

55,2

88)

586,

541

Fina

nce

cost

s-

(756

,415

)(4

5,50

5)(3

29,9

64)

(1,1

31,8

84)

-(1

,131

,884

)Sh

are

of lo

ss o

f ass

ocia

tes

--

--

-(1

83,5

38)

(183

,538

)

Profi

t/(Lo

ss) b

efor

e ta

x1,

198,

362

778,

838

(1,4

63,2

70)

(682

,986

)(1

69,0

56)

1,47

5,65

21,

306,

596

Tax

expe

nse

(204

,510

)(3

34,0

08)

69,0

29(2

8,49

5)(4

97,9

84)

6,38

0(4

91,6

04)

Profi

t/(Lo

ss) f

or th

e fin

anci

al y

ear

993,

852

444,

830

(1,3

94,2

41)

(711

,481

)(6

67,0

40)

1,48

2,03

281

4,99

2

2016

:R

even

ueEx

tern

al re

venu

e36

2,79

017

,757

,580

320,

956

11,0

75,4

8829

,516

,814

-29

,516

,814

Inte

r-seg

men

t rev

enue

3,81

0,64

263

,197

13,1

32,3

79-

17,0

06,2

18(1

7,00

6,21

8)-

Tota

l rev

enue

4,17

3,43

217

,820

,777

13,4

53,3

3511

,075

,488

46,5

23,0

32(1

7,00

6,21

8)29

,516

,814

Res

ults

Segm

ent p

rofit

/(los

s)2,

152,

352

1,19

9,77

621

4,36

4(9

,326

,432

)(5

,759

,940

)10

,337

,919

4,57

7,97

9O

ther

inco

me

441,

339

3,66

0,50

14,

747,

108

903,

736

9,75

2,68

4(8

,282

,991

)1,

469,

693

Fina

nce

cost

s-

(555

,190

)-

(404

,410

)(9

59,6

00)

-(9

59,6

00)

Shar

e of

pro

fit o

f ass

ocia

tes

1,70

0,00

0-

--

1,70

0,00

013

8,58

01,

838,

580

Profi

t/(Lo

ss) b

efor

e ta

x4,

293,

691

4,30

5,08

74,

961,

472

(8,8

27,1

06)

4,73

3,14

42,

193,

508

6,92

6,65

2Ta

x ex

pens

e(7

12,9

82)

(1,4

58,2

81)

(5,3

82)

(6,5

25)

(2,1

83,1

70)

6,38

0(2

,176

,790

)

Profi

t/(Lo

ss) f

or th

e fin

anci

al y

ear

3,58

0,70

92,

846,

806

4,95

6,09

0(8

,833

,631

)2,

549,

974

2,19

9,88

84,

749,

862


82


8383

31.

Ope

ratin

g se

gmen

ts (c

ontin

ued)

Segm

ent r

even

ue a

nd re

sults

(con

tinue

d)

The

acco

untin

g po

licie

s of

the

repo

rtabl

e se

gmen

ts a

re th

e sa

me

as th

e G

roup

’s a

ccou

ntin

g po

licie

s de

scrib

ed in

Not

e 2

to th

e fin

anci

al s

tate

men

ts. S

egm

ent p

rofit

re

pres

ents

the

profi

t ear

ned/

loss

suff

ered

by

each

seg

men

t with

out o

ther

inco

me,

fina

nce

cost

s, s

hare

of p

rofit

/(los

s) o

f ass

ocia

tes

and

tax

expe

nses

. Thi

s is

the

mea

sure

repo

rted

to th

e ch

ief o

pera

ting

deci

sion

mak

er fo

r the

pur

pose

of r

esou

rce

allo

catio

n an

d as

sess

men

t of s

egm

ent p

erfo

rman

ce.

Segm

ent a

sset

s an

d lia

bilit

ies

Inve

stm

ent

Prop

erty

hold

ings

Man

ufac

turin

gC

onst

ruct

ion

deve

lopm

ent

Tota

lEl

imin

atio

nC

onso

lidat

edR

MR

MR

MR

MR

MR

MR

M20

17A

sset

sSe

gmen

t ass

ets

113,

325,

331

31,1

09,0

932,

118,

806

105,

269,

085

251,

822,

315

(129

,927

,584

)12

1,89

4,73

1In

vest

men

ts in

ass

ocia

tes

1,50

4,76

820

,000

--

1,52

4,76

8(8

11,3

83)

713,

385

Una

lloca

ted

corp

orat

e as

sets

56,7

5066

3,28

611

4,18

52,

474,

037

3,30

8,25

8-

3,30

8,25

8

Con

solid

ated

tota

l ass

ets

256,

655,

341

(130

,738

,967

)12

5,91

6,37

4

Liab

ilitie

sSe

gmen

t lia

bilit

ies

8,79

6,91

69,

500,

892

10,7

59,2

938,

184,

375

37,2

41,4

76(2

9,01

9,22

0)8,

222,

256

Una

lloca

ted

corp

orat

e lia

bilit

ies

198,

892

10,3

38,9

422,

699,

560

6,38

7,81

219

,625

,206

-19

,625

,206

Con

solid

ated

tota

l lia

bilit

ies

56,8

66,6

82(2

9,01

9,22

0)27

,847

,462

2016

Ass

ets

Segm

ent a

sset

s11

2,23

7,82

033

,001

,391

1,53

4,51

711

0,20

0,12

525

6,97

3,85

3(1

26,1

57,3

62)

130,

816,

491

Inve

stm

ents

in a

ssoc

iate

s1,

504,

768

20,0

00-

-1,

524,

768

(627

,843

)89

6,92

5U

nallo

cate

d co

rpor

ate

asse

ts10

,040

746,

399

253,

388

2,10

7,96

83,

117,

795

-3,

117,

795

Con

solid

ated

tota

l ass

ets

261,

616,

416

(126

,785

,205

)13

4,83

1,21

1

Liab

ilitie

sSe

gmen

t lia

bilit

ies

7,27

9,60

58,

922,

359

9,91

8,02

68,

983,

486

35,1

03,4

76(2

3,79

7,65

2)11

,305

,824

Una

lloca

ted

corp

orat

e lia

bilit

ies

265,

028

12,5

86,5

73-

9,61

3,03

422

,464

,635

-22

,464

,635

Con

solid

ated

tota

l lia

bilit

ies

57,5

68,1

11(2

3,79

7,65

2)33

,770

,459

For t

he p

urpo

ses

of m

onito

ring

segm

ent p

erfo

rman

ce a

nd a

lloca

ting

reso

urce

s be

twee

n se

gmen

ts:

(i)

all a

sset

s ar

e al

loca

ted

to re

porta

ble

segm

ents

oth

er th

an in

vest

men

ts in

ass

ocia

tes,

sho

rt-te

rm d

epos

its, c

urre

nt a

nd d

efer

red

tax

asse

ts, a

nd o

ther

fina

ncia

l as

sets

. Goo

dwill

is a

lloca

ted

to re

porta

ble

segm

ents

.(ii

) al

l lia

bilit

ies

are

allo

cate

d to

repo

rtabl

e se

gmen

ts o

ther

than

oth

er b

orro

win

gs a

nd c

urre

nt a

nd d

efer

red

tax

liabi

litie

s.


83


31.

Ope

ratin

g se

gmen

ts (c

ontin

ued)

Oth

er s

egm

ent i

nfor

mat

ion

Inve

stm

ent

Prop

erty

hold

ings

Man

ufac

turin

gC

onst

ruct

ion

deve

lopm

ent

Tota

l El

imin

atio

nC

onso

lidat

edR

MR

MR

MR

MR

MR

MR

M

2017

Oth

er in

form

atio

nAd

ditio

ns to

non

-cur

rent

ass

ets

3,72

038

4,73

8-

10,4

1539

8,87

3-

398,

873

Dep

reci

atio

n an

d am

ortis

atio

n ex

pens

e16

0,58

918

4,81

3-

156,

796

502,

198

-50

2,19

8N

on-c

ash

expe

nses

oth

er th

an

depr

ecia

tion

and

amor

tisat

ion

867

--

-86

7-

867

2016

Oth

er in

form

atio

nAd

ditio

ns to

non

-cur

rent

ass

ets

85,7

4560

5,55

9-

7,45

369

8,75

7-

698,

757

Dep

reci

atio

n an

d am

ortis

atio

n ex

pens

e34

,035

281,

575

-15

5,89

547

1,50

5-

471,

505

Non

-cas

h ex

pens

es o

ther

than

de

prec

iatio

n an

d am

ortis

atio

n1,

437

1,23

4,85

3-

9,00

01,

245,

290

-1,

245,

290

Rev

enue

from

maj

or p

rodu

cts

and

serv

ices

Anal

ysis

of r

even

ue fr

om m

ajor

pro

duct

s an

d se

rvic

es w

as n

ot d

iscl

osed

due

to it

is n

ot p

ract

ical

to a

naly

se th

ese

info

rmat

ion

with

out i

ncur

ring

exce

ssiv

e co

sts.

Geo

grap

hica

l inf

orm

atio

n

Info

rmat

ion

on g

eogr

aphi

cal s

egm

ents

is n

ot p

rese

nted

as

the

Gro

up o

pera

tes

pred

omin

antly

in M

alay

sia.


84


8585

32. Financial instruments

Categories of financial instrument

The table below provides an analysis of financial instruments categorised as follows:(a) Loan and receivables (“L&R”);(b) Financial liabilities measured at amortised cost (“FL”).

Carryingamount L&R FL

RM RM RM2017GroupFinancial assetsTrade and non-trade receivables 8,681,840 8,681,840 -Short term deposits with licensed banks 1,040,753 1,040,753 -Cash and bank balances 2,093,901 2,093,901 -

11,816,494 11,816,494 -Financial liabilitiesTrade and non-trade payables (7,517,265) - (7,517,265)Borrowings (19,426,314) - (19,426,314)

(26,943,579) - (26,943,579)2016GroupFinancial assetsTrade and non-trade receivables 11,770,668 11,770,668 -Fixed deposits with licensed banks 1,029,816 1,029,816 -Cash and bank balances 3,412,910 3,412,910 -

16,213,394 16,213,394 -Financial liabilitiesTrade and non-trade payables (10,520,136) - (10,520,136)Borrowings (22,199,207) - (22,199,207)

(32,719,343) - (32,719,343)


85


32. Financial instruments (continued)

Categories of financial instrument (continued)

Carryingamount L&R FL

RM RM RM2017CompanyFinancial assetsTrade and non-trade receivables 4,209,476 4,209,476 -Cash and bank balances 97,737 97,737 -

4,307,213 4,307,213 -Financial liabilitiesTrade and non-trade payables (1,042,809) - (1,042,809)

2016CompanyFinancial assetsTrade and non-trade receivables 6,914,810 6,914,810 -Cash and bank balances 263,943 263,943 -

7,178,753 7,178,753 -Financial liabilitiesTrade and non-trade payables (119,881) - (119,881)

Financial risk management objectives and policies

The Group and the Company are exposed to financial risks arising from their operations and the use of financial instruments. The key financial risks include credit risk, interest rate risk, cash flows risk and liquidity risk.

The Group’s and the Company’s financial risk management policy seeks to ensure that adequate financial resources are available for the development of the Group’s and of the Company’s businesses whilst managing its credit risk, interest rate risk,cash flows and liquidity risk.

The following sections provide details regarding the Group’s and the Company’s exposure to the above mentioned financial risks and the objectives, policies and processes for the management of these risks.

Credit risk The Group’s exposure to credit risk, or the risk of counterparties defaulting, arises mainly from trade receivables. The Group manages its exposure to credit risk by the application of credit approvals, credit limits and monitoring procedures on an ongoing basis. For other financial assets (including cash and bank balances), the Group minimises credit risk by dealing exclusively with high credit rating counterparties.

The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of the trade receivables as appropriate. The main components of this allowance are a specific loss component that relates to individually significant exposures, and a collective loss component established for groups of similar assets in respect of losses that might have been incurred but not yet identified. Impairment is estimated by management based on prior experience and the current economic environment.


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Credit risk (continued)

Credit risk concentration profile

The Group has no major concentration of credit risk and manages these risks by monitoring credit ratings and limiting the aggregate financial exposure to any individual counterparty.

Exposure to credit risk

As the Group does not hold any collateral, the maximum exposure to credit risk is represented by the carrying amount of the financial assets as at the end of the reporting period.

Ageing analysis

The ageing analysis of the Group’s trade receivables as at reporting date are as follows:

Gross Carryingamount Impairment amount

RM RM RM

Group2017 Not past due: 2,327,831 - 2,327,831Past due:- 1 to 30 days 483,250 - 483,250- 31 to 60 days 183,523 - 183,523- 61 to 90 days 378,429 - 378,429- 91 to 120 days 2,346,824 - 2,346,824- more than 120 days 1,920,452 (1,120,941) 799,511

7,640,309 (1,120,941) 6,519,368

Group2016 Not past due: 3,441,109 - 3,441,109Past due:- 1 to 30 days 483,534 - 483,534- 31 to 60 days 545,041 - 545,041- 61 to 90 days 610,710 - 610,710- 91 to 120 days 2,877,692 - 2,877,692- more than 120 days 2,725,800 (1,095,973) 1,629,827

10,683,886 (1,095,973) 9,587,913

The impairment is determined based on estimated irrecoverable amounts from the sale of goods, determined by reference to past default experience.

Trade receivables that are neither past due nor impaired

A significant portion of trade receivables that are neither past due nor impaired are regular customers that have been transacting with the Group. The Group uses ageing analysis to monitor the credit quality of the trade receivables. Any receivables having significant balances past due, which are deemed to have higher credit risk, are monitored individually.


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Credit risk (continued)

Trade receivables that are past due but not impaired

The Group believes that no impairment allowance is necessary in respect of these trade receivables. They are substantially companies with good collection track record and no recent history of default.

Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market interest rate. The Group’s exposure to interest rate risk arises mainly from interest-bearing financial assets and liabilities. The Group’s policies are to obtain the most favourable interest rates available. Any surplus funds of the Group will be placed with licensed financial institutions to generate interest income.

In respect of interest-earning financial assets and interest-bearing financial liabilities, the following table indicates its effective interest rates at the reporting date and the periods in which they mature or are reprice.

Effective interest rates and repricing analysis

Effective interest rate per annum Within 1 year 1 - 5 years Total

% RM RM RMGroup2017Financial assetsFixed deposits with licensed banks 2.75 - 3.15 1,040,753 - 1,040,753

Financial liabilitiesBorrowings- Bank overdrafts 7.60 - 8.20 (17,907,262) - (17,907,262)- Term loans 7.85 (525,720) (993,332) (1,519,052)

(18,432,982) (993,332) (19,426,314)

(17,392,229) (993,332) (18,385,561)2016Financial assetsFixed deposits with licensed banks 2.75 - 3.45 1,029,816 - 1,029,816

Financial liabilitiesBorrowings- Bankers acceptance 1.50 - 5.40 (284,901) - (284,901)- Bank overdrafts 7.60 - 8.45 (19,909,586) - (19,909,586)- Term loans 7.85 (482,728) (1,521,992) (2,004,720)

(20,677,215) (1,521,992) (22,199,207)

(19,647,399) (1,521,992) (21,169,391)


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32. Financial Instruments (continued)

Interest rate risk (continued)

Interest rate risk sensitivity analysis

The following table details the sensitivity to a reasonably possible change in the interest rates as at the end of the reporting period, with all other variables held constant, on the Group’s equity and profits:

Group2017 2016

Increase/(Decrease)

Increase/(Decrease)

RM RM

Effects on profit after taxation

Increase of 10 basis point (1,379) (1,588)Decrease of 10 basis point 1,379 1,588

Effects on equity

Increase of 10 basis point (1,379) (1,588)Decrease of 10 basis point 1,379 1,588

Cash flow risk

The Group reviews its cash flow position regularly to manage their exposure to fluctuations in future cash flows associated with their monetary financial instruments.

Liquidity risk

Ultimate responsibility for liquidity risk management rests with the board of directors, which has established an appropriate liquidity risk management framework for the management of the Group’s and the Company’s funding and liquidity management requirements. The Group and the Company’s manages liquidity risk by maintaining adequate reserves and banking facilities, by continuously monitoring forecast and actual cash flows, and by matching the maturity profiles of financial assets and liabilities.

The Group and the Company monitors and maintains a level of cash and cash equivalents deemed adequate by management to finance the Group’s and the Company’s operations and to mitigate the effects of fluctuations in cash flows.

It is not expected that the cash flows included in the maturity analysis could significant earlier, or at significantly different amounts.


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Liquidity risk (continued)

Maturity analysis

The table below show summaries the maturity profile of the Group’s and the Company’s financial liabilities as at the end of the reporting period based on undiscounted contractual payments:

Carrying amount

Contractualinterest

rate

Contractualcashflows

Within1 year 1 - 5 years

RM % RM RM RM

Group2017Trade and non-trade payables 7,517,265 - 7,517,265 7,517,265 -Borrowings:- Bank overdraft 17,907,262 7.60 - 8.45 17,907,262 17,907,262 -- Term loan 1,519,052 7.85 1,519,052 525,720 993,332

26,943,579 26,943,579 25,950,247 993,332

2016Trade and non-trade payables 10,520,136 - 10,520,136 10,520,136 -Borrowings:- Banker acceptance 284,901 1.50 - 5.40 284,901 284,901 -- Bank overdraft 19,909,586 7.60 - 8.45 19,909,586 19,909,586 -- Term loan 2,004,720 7.85 2,004,720 482,728 1,521,992

32,719,343 32,719,343 31,197,351 1,521,992Company2017Trade and non-trade payables 1,042,809 - 1,042,809 1,042,809 -

2016Trade and non-trade payables 119,881 - 119,881 119,881 -



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Fair values

The following summarises the methods used to determine the fair values of the financial instruments:

(i) The financial assets and financial liabilities maturing within the next 12 months approximated their fair values due to the relatively short term maturity of the financial instruments.

(ii) The carrying amounts of the term loans approximated their fair values as these instruments bear interest at variable rates.

The aggregate fair values and the carrying amount of the financial assets and financial liabilities carried on the statement of financial position as at 31 March are as below:

Fair value hierarchy

The table below analyses financial instrument carried at fair value, by valuation method. The different levels have been defined as follows:

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities.Level 2: Inputs other than quoted prices included within Level 1 that are observable for assets or liabilities, either directly (i.e. as prices) or indirectly (i.e. derived from prices).Level 3: Input for the assets or liabilities that are not based on observable market data (unobservable inputs).

2017 2016

Carryingamount

Fairvalue

Carryingamount

Fairvalue

RM RM RM RMLevel 2 Level 2

GroupFinancial liability:Borrowings 19,426,314 19,426,314 22,199,207 22,199,207

33. Capital management

The primary objective of the Group’s and the Company capital management is to ensure that it maintains a strong credit rating and healthy capital ratios in order to support its business and maximise shareholder value.

The Group and the Company manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To maintain or adjust the capital structure, the Group and the Company may adjust the dividend payment to shareholders, return capital to shareholders or issue new shares. No changes were made in the objectives, policies or processes during the years ended 31 March 2017 and 31 March 2016.

Under the requirements of Bursa Malaysia Practice Note 17, the Group is required to maintain a consolidated Shareholders’ equity equal to or not less than 25% of the issued and paid up capital (excluding treasury shares). The Group has complied with this requirement.



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33. Capital management (continued)

The debt to equity ratio of the Group as at the end of the reporting period was as follows:

Group2017 2016RM RM

Borrowing 19,426,314 22,199,207Less: Fixed deposits licensed banks (1,040,753) (1,029,816)Less: Cash and bank balances (2,093,901) (3,412,910)

Net debt 16,291,660 17,756,481Total equity 98,068,912 101,060,752

Total capital 114,360,572 118,817,233

Gearing ratio (times) 0.14 0.15

The debt to equity ratio is calculated as net debt divided by total capital. Net debt is calculated based on borrowings less cash and cash equivalents. Total capital is calculated as equity plus net debt.


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9393

34. Supplementary information – disclosure on realised and unrealised profits/losses

On 25 March 2010, Bursa Malaysia Securities Berhad issued a directive to all listed issuers pursuant to Paragraphs 2.06 and 2.23 of the Bursa Securities Main Market Listing Requirements. The directive requires all listed issuers to disclose the breakdown of the unappropriated profits or accumulated losses as of the end of the reporting period into realised and unrealised profits or losses.

On 20 December 2010, Bursa Malaysia Securities Berhad further issued guidance on the disclosure and the prescribed format required.

The breakdown of the accumulated losses of the Group and of the Company as of 31 March 2017 into realised and unrealised amounts, pursuant to the directive, is as follows:


Total accumulated losses of the Company and its subsidiaries:Realised 656,073 5,197,743 (34,907,952) (31,433,484)Unrealised (708,291) (785,688) - -

(52,218) 4,412,055 (34,907,952) (31,433,484)

Add: Consolidation adjustments (28,863,238) (30,334,894) - -

Total accumulated losses as per statements of financial position (28,915,456) (25,922,839) (34,907,952) (31,433,484)

The determination of realised and unrealised profits or losses is based on Guidance of Special Matter No. 1 “Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Securities Listing Requirements” as issued by the Malaysian Institute of Accountants on 20 December 2010. A charge or a credit to the profit or loss of a legal entity is deemed realised when it is resulted from the consumption of resource of all types and form, regardless of whether it is consumed in `the ordinary course of business or otherwise. A resource may be consumed through sale or use. Where a credit or a charge to the profit or loss upon initial recognition or subsequent measurement of an asset or a liability is not attributed to consumption of resource, such credit or charge should not be deemed as realised until the consumption of recourse could be demonstrated.

The supplementary information been made solely for complying with the disclosure requirements stipulated in the directive of Bursa Malaysia Securities Berhad and is not made for any other purposes.

35. General information

The Company is a public limited liability company, incorporated and domiciled in Malaysia and is listed on the Main Market of Bursa Malaysia Securities Berhad.

The Company is principally involved in investment holding and providing management services. The principal activities of the subsidiaries are as stated in Note 15 to the financial statements.

There has been no significant change in the nature of the activities of the Group and of the Company during the financial year.

The registered office of the Company is at 39, Salween Road, 10050 Penang, Malaysia. The principal place of business of the Company is at No. 65, Sri Bahari Road, 10050 Penang, Malaysia.

The financial statements of the Group and of the Company were authorised for issue by the Board of Directors on 18 July 2017.


93


Location Descriptionof Property

Existing Use

Area (approximate)

Age ofBuilding

(approximateyears)

Tenure Date of Acquisition

CarryingAmount

as at Mar 31, 2017

RM'000

Lot 3006, Mukim 6,Daerah Seberang Perai Tengah,Pulau Pinang.

3 Storey Shop -Office Building

OfficePremises

4,020square feet

22 Freehold 18/05/2004 339

Lot 1019,1283,1284,1333,1334,1337 ~ 1341 & 1348 ~ 1351,Mukim 12,Daerah Seberang Perai Tengah,Pulau Pinang.

Quarry Land QuarryingActivities

48acres

- Freehold 18/05/2004 14,570

Plot 285,Bayan Lepas Industrial Estate,Phase III,Pulau Pinang.

Industrial Land and

Building

RentedOut

23,329square feet

22 Leasehold(expiry:

2049)

18/05/2004 2,741

Lot 544, 590, 1307, 3429, 3430, 3435 & 3436, Mukim 3,Daerah Seberang Perai Utara,Pulau Pinang.

Agriculture Land

RentedOut

19acres

- Freehold 18/05/2004 680

Lot 20039~20396 & 20399~20408,Mukim 14, Daerah Seberang, Perai Selatan,Pulau Pinang.

PropertyDevelopment-

in-progress

PropertyDevelopment

Project

66acres

- Freehold 18/05/2004 29,164

Lot 2152~2202, 2204~2214 & 2216~2264,Seksyen 42, Tebuan, Bandar Kulim,Kedah Darul Aman.

Vacant Land Vacant 15acres

- Freehold 18/05/2004 3,676

Lot 2328, Mukim 6,Daerah Seberang Perai Selatan,Pulau Pinang.

Bungalow Lot Vacant 10,764square feet

- Freehold 18/05/2004 131

Lot 24, Seksyen 18,Daerah Timur Laut,Bandar Georgetown,Pulau Pinang.

Shop cum Office

Vacant 129square metres

11 Freehold 31/03/2005 211

Plot 728, No.3058/95, P.T No.1523,Mukim Padang Meha,Daerah Kulim, Kedah.

Single StoreyBungalow

Vacant 3,606square feet

9 Freehold 18/12/2007 167

Lot Nos. 785 & 786, Section 4,Town of Georgetown,ASWAN, Level 5,Parcel No. 4A (single), Penang.

Condominium Vacant 2,129square feet

19 Freehold 05/11/2009 849

Lot 297, Merbau Pulas,Pekan Merbau Pulas,Kulim, Kedah.

Vacant Land Vacant 473,454square feet

- Freehold 30/12/2009 4,260

Group PropertiesAs At 31 March 2017

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9595

Group Properties (cont’d)As At 31 March 2017

Location Descriptionof Property

Existing Use

Area (approximate)

Age ofBuilding

(approximateyears)

Tenure Date of Acquisition

CarryingAmount

as at Mar 31, 2017

RM'000

Lot 7703, Mk 14, Daerah, Seberang Perai Tengah, Pulau Pinang.

Industrial Land and

Building

Workshop 93,571square feet

19 Leasehold(Expiry:

2056)

21/12/2009 1,481

Lot Nos. 194 and 195, Mukim 5, Tempat Titi Serong, Daerah Barat Daya, Pulau Pinang.Lot Nos. 381, 382, 383 and 384, Mukim 5, Tempat Bukit Relau, Daerah Barat Daya, Pulau Pinang.


- Freehold 21/12/2009 4,142

Lot 1202, 1204, 1206 and 1064,Seksyen 4, Town of Butterworth,Seberang Perai Utara, Pulau Pinang.

Vacant Land RentedOut

31,179square feet

- Freehold 21/12/2009 2,027

Lot 1205, Section 4,Town of Butterworth,Seberang Perai Utara, Pulau Pinang.

Development Land

RentedOut

4,065square feet

- Freehold 21/06/2010 306

Lot 518 & 519, Section 4,Town of Butterworth,Seberang Perai Utara, Pulau Pinang.

Development Land

RentedOut

10,459square feet

- Freehold 08/11/2010 794

Lot Nos. 785 & 786, Section 4,Town of Georgetown,ASWAN, Level 2,Parcel No. 1A (single), Penang.

Condominium Vacant 2,129square feet

19 Freehold 05/11/2009 983

Lot 904, Mukim Padang Peliang,Daerah Pendang, Kedah.


- Leasehold(Expiry:

2091)

11/04/2013 116

Lot 117, Mukim 12,Daerah Seberang Perai Tengah,Negeri Pulau Pinang.

Vacant Land Vacant 26,657square metres

- Freehold 30/1/2016 6,949

95


Analysis Of ShareholdingsAs At 30 June 2017

Shareholdings Statistics

Issued and Paid Up Capital : RM126,784,397Class of Share : Ordinary sharesVoting Right : One vote for each ordinary share

Distribution of Shareholdings

No. of Holders Holdings Total Holdings % of Issued Capital

34 1 - 99 1,339 0.001,202 100 - 1,000 261,159 0.21

128 1,001 - 10,000 523,657 0.4145 10,001 - 100,000 1,809,701 1.4342 100,001 and below 5% 53,667,164 42.33

2 5% and above 70,521,377 55.62

Total 1,453 126,784,397 100.00

List of the Thirty Largest Shareholders

No. Shareholders No. of Shares% of

Issued Capital1 JMR CONSOLIDATED HOLDINGS SDN BHD 63,404,877 50.01 2 MAYBANK NOMINEES (TEMPATAN) SDN BHD

BENEFICIARY: PLEDGED SECURITIES ACCOUNT FOR GOH NAI KOOI @ GAH MAI KWAI 7,116,500 5.61

3 SYABAS WILAYAH SDN. BHD. 6,155,100 4.854 MAYBANK NOMINEES (TEMPATAN) SDN BHD

BENEFICIARY: VANLITE ENTERPRISE (M) SDN BHD5,250,100 4.14

5 MAYBANK NOMINEES (TEMPATAN) SDN BHDBENEFICIARY: QUAH SAW GIM

4,753,000 3.75

6 LIM HONG SIANG @ LIM HONG SUN 4,350,000 3.437 MAYBANK NOMINEES (TEMPATAN) SDN BHD

BENEFICIARY: OOI BEE SIM3,858,500 3.04

8 MAYBANK NOMINEES (TEMPATAN) SDN BHDBENEFICIARY: BOEY CHENG HAI

3,000,000 2.37

9 DOESTRONIC SDN.BHD. 2,971,000 2.3410 GOH YONG CHEE 2,500,000 1.9711 LEADING BUILDERS SDN. BHD. 2,393,686 1.8912 FONG AH FOOK CIVIL

CONSTRUCTION SDN. BHD.2,224,900 1.75

13 MAYBANK NOMINEES (TEMPATAN) SDN BHDBENEFICIARY: GOH NAI KOOI @ GOH MAI KWAI

1,972,000 1.56

14 PENG WEN CHIH 1,557,934 1.2315 HLIB NOMINEES (TEMPATAN) SDN BHD

BENEFICIARY: HONG LEONG BANK BHD FOR SENCO (M) SDN BHD1,529,000 1.21

16 MAYBANK NOMINEES (TEMPATAN) SDN BHDBENEFICIARY: LAI PIN YONG

1,500,000 1.18

17 ALLIANCE GROUP NOMINEES (TEMPATAN) SDN BHDBENEFICIARY: PLEDGED SECURITIES ACCOUNT FOR GOH NAI KOOI @ GAH MAI KWAI (8119540)

875,850 0.69

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9797

Analysis Of Shareholdings (cont’d)As At 30 June 2017

List of the Thirty Largest Shareholders (cont’d)

No. Shareholders No. of Shares% of

Issued Capital18 GOH YONG LIN 511,000 0.4019 CHEE KIT HO 509,000 0.4020 JANIS TAN SOOI IMM 500,000 0.3921 BOEY CHENG HAI 491,846 0.3922 GOH YONG CHEE 457,300 0.3623 TAN YEN KEAN 450,000 0.3524 MAYBANK NOMINEES (TEMPATAN) SDN BHD

BENEFICIARY: PLEDGED SECURITIES ACCOUNT FOR TAN KIAT POH411,000 0.32

25 GOH NAI KOOI @ GAH MAI KWAI 400,000 0.3226 MAYBANK NOMINEES (TEMPATAN) SDN BHD

BENEFICIARY: TAN KIAT POH391,400 0.31

27 TEOH HIN HENG 388,200 0.3128 PH'NG SEOK TIANG 355,257 0.2829 TAN KIAT POH 351,900 0.2830 MAYBANK NOMINEES (TEMPATAN) SDN BHD

BENEFICIARY: TEOH LENG LAN342,600 0.27

Substantial Shareholders

No. of Ordinary Shares

ShareholdersDirect

Interest% of

Issued CapitalDeemed Interest

% of Issued Capital

JMR Consolidated Holdings Sdn Bhd 63,404,877 50.01 - -Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai 10,443,150 8.24 70,282,877* 55.43Datin Quah Saw Gim 4,753,000 3.75 64,893,877** 51.18Dato’ Ir. Dr. Goh Yong Chee 2,957,300 2.33 65,393,877*** 51.58

* Deemed interest through corporate shareholders and his spouse and daughter.** Deemed interest through corporate shareholders.*** Deemed interest through corporate shareholders and his spouse.

Directors' Shareholdings

No. of Ordinary Shares

DirectorsDirect

InterestDeemed Interest Total

% of Issued Capital

Dato’ Ir. Goh Nai Kooi @ Gah Mai Kwai 10,443,150 70,282,877* 80,726,027 63.67Dato’ Ir. Dr. Goh Yong Chee 2,957,300 65,393,877** 68,351,177 53.91Tham Yen Thim 334,000 - 334,000 0.26Ir. Boey Cheng Hai 3,491,846 - 3,491,846 2.75

* Deemed interest through corporate shareholders and his spouse and daughter.** Deemed interest through corporate shareholders and his spouse.

97


Notice of the Fifteenth Annual General Meeting

NOTICE IS HEREBY GIVEN THAT the Fifteenth Annual General Meeting of JMR Conglomeration Bhd. (“JMR” or the “Company”) will be held at Lawang Room, Parkroyal Penang, Batu Ferringhi Beach, 11100 Penang, Malaysia on Wednesday, 23rd day of August, 2017 at 11.30 a.m for the transaction of the following business:

AS ORDINARY BUSINESS

1. To receive the Audited Financial Statements for the financial year ended 31 March 2017 together with the Reports of the Directors and Auditors thereon.

2. To approve the payment of Directors’ fees of RM83,000.00 for the financial year ended 31 March 2017. Resolution 1

3. To approve the payment of Directors’ remuneration (excluding Directors’ fees) of not exceeding RM31,500.00 from 31 January 2017 until the next Annual General Meeting of the Company. Resolution 2

4. To re-elect Dato’ IR. Dr. Goh Yong Chee, a Director of the Company retiring pursuant to Article 109 of the Company’s Constitution. Resolution 3

5. To consider and if thought fit, to pass the following resolutions:

(a) “THAT Mr. Tham Yen Thim be and is hereby re-appointed as Director of the Company.”

(b) “THAT IR. Boey Cheng Hai be and is hereby re-appointed as Director of the Company.”

(c) “THAT Dato’ IR. Goh Nai Kooi @ Gah Mai Kwai be and is hereby re-appointed as Director of the Company.”

Resolution 4

Resolution 5

Resolution 6

6. To re-appoint Messrs. PKF as Auditors of the Company until the conclusion of the next annual general meeting and to authorise the Directors to fix their remuneration. Resolution 7

7.

AS SPECIAL BUSINESS

To consider and, if thought fit, to pass the following resolutions, with or without modification, as Ordinary Resolutions:

AUTHORITY UNDER SECTIONS 75 AND 76 OF THE COMPANIES ACT, 2016 FOR THE DIRECTORS TO ISSUE SHARES“THAT, subject always to the Companies Act, 2016 (“the Act”), the Constitution of the Company and the approvals of the relevant government and/or regulatory authorities, the Directors be and are hereby authorised, pursuant to Sections 75 and 76 of the Act, to allot and issue shares in the Company at any time until the conclusion of the next Annual General Meeting or the expiration of the period within which the next Annual General Meeting is required by law to be held or revoked/varied by resolution passed by the shareholders in general meeting whichever is the earlier and upon such terms and conditions and for such purposes as the Directors may, in their absolute discretion, deemed fit, provided that the aggregate number of shares to be issued does not exceed 10% of the total number of issued shares of the Company for the time being and that the Directors are also empowered to obtain the approval from Bursa Malaysia Securities Berhad for the listing of and quotation for the additional shares to be issued.” Resolution 8

8. To transact any other business of which due notice shall have been given in accordance with the Company’s Constitution and the Companies Act, 2016.

By Order of the Board

OOI YOONG YOONG (MAICSA 7020753) SecretaryPenang31 July 2017

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9999

Notes:

Appointment of Proxy

1. A member of the Company entitled to attend and vote is entitled to appoint any person as his proxy to attend and vote in his stead. There is no restriction as to the qualification of the proxy. A proxy need not be a member of the Company, an advocate, an approved company auditor or a person approved by the Registrar.

2. The instrument appointing a proxy must be deposited at the registered office of the Company at 39 Salween Road, 10050 Penang

not less than forty eight (48) hours before the time appointed for holding the meeting. 3. The instrument appointing a proxy shall be in writing under the hands of the appointor or his attorney duly authorised in writing or

if such appointor is a corporation, (a) under its Seal or (b) under the hands of its attorney duly authorised and in the case of (b), be supported by a certified true copy of the power of attorney.

4. A Member shall not, subject to Paragraph (5) below, be entitled to appoint more than two (2) proxies to attend and vote at the same

meeting. Where a member appoints two (2) proxies to attend and vote at the same meeting, the appointment shall be invalid unless the member specifies the proportion of his shareholding to be represented by each proxy.

5. Where a Member of the Company is an exempt authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991, which holds ordinary shares in the Company for multiple beneficial owners in one securities account (“omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

General Meeting Record of Depositors

6. Only a depositor whose name appears on the Record of Depositors of the Company as at 16 August 2017 shall be entitled to attend this Annual General Meeting or appoint proxies to attend, speak and/or vote on his/her behalf.

Ordinary Business

7. Ordinary Resolution 2 – Proposed payment of Directors’ remuneration (excluding Directors’ fees) of not exceeding RM31,500.00 from 31 January 2017 until the next AGM of the Company.

The total estimated amount of Directors’ benefits payable is calculated based on the number of scheduled Board’s and Board Committees’ meetings from 31 January 2017 until the next Annual General Meeting. This authority, unless revoked or varied by the Company in a general meeting will expire at the conclusion of the next Annual General Meeting of the Company.

8. Ordinary Resolution 4 – Re-Appointment of Mr. Tham Yen Thim as Director of the Company

Mr. Tham Yen Thim, who is above the age of 70, was re-appointed as Director pursuant to Section 129 of the Companies Act, 1965 at the Fourteenth Annual General Meeting of the Company held on 22 August 2016 to hold office until the conclusion of the forthcoming Fifteenth Annual General Meeting. His term of office will end at the conclusion of the forthcoming Fifteenth Annual General Meeting.

There is no age limit for directors pursuant to the Companies Act, 2016 which came into force on 31 January 2017. The proposed resolution 4, if passed, will enable Mr. Tham Yen Thim, who has offered himself for re-appointment to continue to act as a Director of the Company.

9. Ordinary Resolution 5 – Re-Appointment of IR. Boey Cheng Hai as Director of the Company

IR. Boey Cheng Hai, who is above the age of 70, was re-appointed as Director pursuant to Section 129 of the Companies Act, 1965 at the Fourteenth Annual General Meeting of the Company held on 22 August 2016 to hold office until the conclusion of the forthcoming Fifteenth Annual General Meeting. His term of office will end at the conclusion of the forthcoming Fifteenth Annual General Meeting.

There is no age limit for directors pursuant to the Companies Act, 2016 which came into force on 31 January 2017. The proposed resolution 5, if passed, will enable IR. Boey Cheng Hai, who has offered himself for re-appointment to continue to act as a Director of the Company.

Notice of the Fifteenth Annual General Meeting (cont’d)

99


10. Ordinary Resolution 6 – Re-Appointment of Dato’ IR. Goh Nai Kooi @ Gah Mai Kwai as Director of the Company

Dato’ IR. Goh Nai Kooi @ Gah Mai Kwai, who is above the age of 70, was re-appointed as Director pursuant to Section 129 of the Companies Act, 1965 at the Fourteenth Annual General Meeting of the Company held on 22 August 2016 to hold office until the conclusion of the forthcoming Fifteenth Annual General Meeting. His term of office will end at the conclusion of the forthcoming Fifteenth Annual General Meeting.

There is no age limit for directors pursuant to the Companies Act, 2016 which came into force on 31 January 2017. The proposed resolution 6, if passed, will enable Dato’ IR. Goh Nai Kooi @ Gah Mai Kwai, who has offered himself for re-appointment to continue to act as a Director of the Company.

Special Business

11. Resolution 8 - Authority under Sections 75 and 76 of the Companies Act, 2016 for the Directors to issue shares

The proposed Ordinary Resolution 8, if passed, will give authority to the Board of Directors to issue and allot ordinary shares in the Company at any time in their absolute discretion and that such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company or the expiration of the period within which the next Annual General Meeting is required by law to be held or revoked/varied by resolution passed by the shareholders in general meeting whichever is the earlier.

As at the date of this Notice, no new shares in the Company were issued pursuant to the mandate granted to the Directors at the last Annual General Meeting which will lapse at the conclusion of the Fifteenth Annual General Meeting.

This renewed general mandate will provide flexibility to the Company for any possible fund raising activities, including but not limited to placing of shares, for purpose of funding future investment project(s), working capital and/or acquisitions.

12. Retirement of Dato’ Abdul Rahman Bin Ahmad as Director of the Company

Dato’ Abdul Rahman Bin Ahmad, who is above the age of 70, was re-appointed as Director pursuant to Section 129 of the Companies Act, 1965 at the Fourteenth Annual General Meeting of the Company held on 22 August 2016 to hold office until the conclusion of the forthcoming Fifteenth Annual General Meeting. His term of office will end at the conclusion of the forthcoming Fifteenth Annual General Meeting.

Dato’ Abdul Rahman Bin Ahmad had indicated to the Company that he does not wish to seek for re-appointment as Director at the Fifteenth Annual General Meeting of the Company. Hence he retired from office as Director of the Company at the close of the Fifteenth Annual General Meeting held on 23 August 2017.

Personal data privacy:

By submitting an instrument appointing a proxy(ies) and/or representative(s) to attend, speak and vote at the AGM and/or any adjournment thereof, a member of the Company (i) consents to the collection, use and disclosure of the member’s personal data by the Company (or its agents) for the purpose of the processing and administration by the Company (or its agents) of proxies and representatives appointed for the AGM (including any adjournment thereof) and the preparation and compilation of the attendance lists, minutes and other documents relating to the AGM (including any adjournment thereof), and in order for the Company (or its agents) to comply with any applicable laws, listing rules, regulations and/or guidelines (collectively, the “Purposes”), (ii) warrants that where the member discloses the personal data of the member’s proxy(ies) and/or representative(s) to the Company (or its agents), the member has obtained the prior consent of such proxy(ies) and/or representative(s) for the collection, use and disclosure by the Company (or its agents) of the personal data of such proxy(ies) and/or representative(s) for the Purposes, and (iii) agrees that the member will indemnify the Company in respect of any penalties, liabilities, claims, demands, losses and damages as a result of the member’s breach of warranty.

Notice of the Fifteenth Annual General Meeting (cont’d)

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I/We(*NRIC NO./COMPANY NO.)

of

being **a member/members of JMR CONGLOMERATION BHD., hereby appoint

(*NRIC NO./COMPANY NO.)

of

or failing him, (*NRIC NO./COMPANY NO.)

of(FULL ADDRESS)

or failing him, the Chairman of the meeting, as * my/our proxy to vote for * me/us on * my/our behalf at the Fifteenth Annual General Meeting of the Company to be held at Lawang Room, Parkroyal Penang, Batu Ferringhi Beach, 11100 Penang, Malaysia on Wednesday 23rd day of August, 2017 at 11.30 a.m and at any adjournment thereof.

No. Resolutions Ordinary For Against

1 To approve the payment of Directors’ fees of RM83,000.00 for the financial year ended 31 March 2017. Resolution 1

2 To approve the payment of Directors’ remuneration (excluding Directors’ fees) of not exceeding RM31,500.00 from 31 January 2017 until the next AGM of the Company.

Resolution 2

3 To re-elect Dato’ IR. Dr. Goh Yong Chee as Director of the Company pursuant to Article 109 of the Company’s Constitution.

Resolution 3

4 To re-appoint Mr. Tham Yen Thim as Director of the Company. Resolution 4

5 To re-appoint IR. Boey Cheng Hai as Director of the Company. Resolution 5

6 To re-appoint Dato’ IR. Goh Nai Kooi @ Gah Mai Kwai as Director of the Company. Resolution 6

7 To re-appoint Messrs. PKF as Auditors of the Company and to authorise the Directors to fix their remuneration. Resolution 7

8 Authority under Sections 75 and 76 of the Companies Act, 2016 for the Directors to issue shares. Resolution 8

Please indicate with an “X” in the appropriate space provided above on how you wish your vote to be cast. If no specific direction as to voting is given, the proxy will vote or abstain from voting at his/her discretion.

The proportion of shareholdings to be represented by my proxies:No. of shares Percentage

Proxy 1Proxy 2

Total 100%

Signed this day of 2017

Notes:

1. A member of the Company entitled to attend and vote is entitled to appoint any person as his proxy to attend and vote in his stead. There is no restriction as to the qualification of the proxy. A proxy need not be a member of the Company, an advocate, an approved company auditor or a person approved by the Registrar.

2. The instrument appointing a proxy must be deposited at the registered office of the Company at 39 Salween Road, 10050 Penang not less than forty eight (48) hours before the time appointed for holding the meeting.

3. The instrument appointing a proxy shall be in writing under the hands of the appointor or his attorney duly authorised in writing or if such appointor is a corporation, (a) under its Seal or (b) under the hands of its attorney duly authorised and in the case of (b), be supported by a certified true copy of the power of attorney.

4. A Member shall not, subject to Paragraph (5) below, be entitled to appoint more than two (2) proxies to attend and vote at the same meeting. Where a member appoints two (2) proxies to attend and vote at the same meeting, the appointment shall be invalid unless the member specifies the proportion of his shareholding to be represented by each proxy.

5. Where a Member of the Company is an exempt authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991, which holds ordinary shares in the Company for multiple beneficial owners in one securities account (“omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus account it holds.

* Strike out whichever is not desired.


(Incorporated in Malaysia)

FORM of PROXYNumber of shares held

CDS account number

Common Seal/Signature of Member

The Company SecretaryJMR Conglomeration Bhd. 592280-W(Incorporated in Malaysia)

39, Salween Road, 10050 Penang,Malaysia.

AffixStamp

Please fold across the lines and close

Please fold across the lines and close

Over Three Decades in Road Paving, Infrastructure and Property Development


日马集团股份有限公司

A Public Listed Company on Bursa Malaysia Securities Berhad since 2004

65, Sri Bahari Road10050 Penang, MalaysiaTel : (604) 264 4992 / 4993Fax : (604) 264 5122Email : [email protected]

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