ppedana-cover to page 78 (3mb).pdf

AnnuAl RepoRt 2009

Building A Sustainable Future

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1 Energy Commission’s Diamond Building, Precinct 2, Putrajaya

2 Malaysia Green Technology Corporation’s Green Energy Office (“GEO”), Bangi

3 Lot 2C2 green commercial office suites, Precinct 2, Putrajaya

4 Sarawak Energy Berhad’s energy efficient headquarters, Kuching

5 Ministry of Energy, Green Technology and Water’s Low Energy Office (“LEO”), Putrajaya

6 D’Heron At The Lakes energy efficient lakeside bungalows, Precinct 16, Putrajaya

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contents

Our Vision & Mission 4Our Philosophy 5Corporate Profile 6Group Corporate Structure 12Corporate Information 13Board of Directors 14Profile of Directors 16Profile of Senior Management 18Chairman’s Statement 22CEO’s Review of Operations 28Group Financial Highlights 36Quarterly Performance 37Financial Calendar 37Share Price Performance 38Corporate Milestones 39

Statement on Corporate Governance 42Audit Committee Report 51Statement on Internal Control 57Additional Compliance Information 59Directors’ Responsibility Statement 61Corporate Responsibility 64Quality, Health and Safety, Environment Statement 77Financial Statements 79Properties of PPB Group 139Analysis of Shareholdings 142Notice of Annual General Meeting 145Form of ProxyGroup Directory

One Menerung luxury condominium, Bangsar

cover rAtIonALe

BuILdIng A sustAInABLe FutureAs a responsible builder and a pioneer in green building construction, Putrajaya Perdana Berhad is committed to undertaking sustainable construction practices that harmonise with the local climate, traditions, culture and surrounding environment. Our aim is to build a sustainable future for our future generations and the Group’s businesses, as well as to contribute towards Malaysia’s progress on its journey to becoming a fully developed nation.

This year’s annual report cover design portrays several of the landmark green building projects that we have been involved in. Many of these have been recognised for their innovative use of green technology and the tangible energy efficiency measures they have delivered. All of them demonstrate our commitment as a premier builder to creating ground-breaking products of quality and distinction.

The Group’s strategy of taking the green route has begun to pay off and we will continue to leverage on this to drive our future performance.

PutrAjAyA PerdAnA BerhAd

Upholds the three essential elements of success:

• Teamwork• Knowledge• Commitment

We are committed to:

• Realising our vision to be the Premier Builder in theregions we operate

• Successfullydeliverourservicestoclients• ContributetowardsmakingMalaysiaafullydevelopednation

ourvIsIon & mIssIon

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Wisma Tani, Putrajaya

Diamond Building, Putrajaya

PutrAjAyA PerdAnA BerhAd (465327-P) • Annual Report 2009

eFFectIve teAmWorK

Putrajaya Perdana Berhad (“PPB”) is built on the solid experience and expertise of its management team. Its services are delivered by a workforce of team-oriented individuals who share the goal of exceeding their clients’ expectations.

The underlying values of PPB form the foundation upon which the Group is built; with integrity, the pursuit of excellence, commitment and respect for every individual; from client to sub-contractors to employees.

The Group prides itself on its pool of talented and skilled workers, which produces the diversity of ideas and creativity at PPB. It is this dynamic depth of ideas and expertise, ingrained at every level, which turns visions into reality and creates outstanding landmarks for our clients.

our PhILosoPhysAFety And trAInIng

PPB believes that successful projects are not merely measured by the finished product, but also by the quality of the process.

Numerous safety courses and drills are implemented as part of the Safety and Health Plan at all project sites, reflecting an uncompromising commitment to safety, training and quality. This plan aims to manage and eliminate potential workplace hazards.

settIng neW stAndArds

PPB strives to continually set new standards in the construction and development industries. Meticulously planned designs are executed with efficient work practices to provide intelligent and elegant design solutions.

This foundation built on integrity, knowledge and commitment serves as the cornerstone of PPB, and fulfils the diverse needs of our highly discerning clients.

05PutrAjAyA PerdAnA BerhAd (465327-P) • Annual Report 2009

corPorAte ProFILe


Pavilion Residences, Kuala Lumpur

deLIverIng IntegrAted BuILdIng And constructIon soLutIons

Incorporated in 1998, Putrajaya Perdana Berhad (“PPB” or “the Group”) is an investment holding company listed on the Main Market of Bursa Malaysia Securities Berhad. We are recognised as one of Malaysia’s most innovative and reliable construction and property development groups, having successfully delivered several prominent and large scale projects on a turnkey design-and-build basis as well as pioneering green and energy efficiency in construction. With the recent addition of a road and pavement maintenance and rehabilitation capability to our portfolio as well as our continued focus on green building construction, the Group today is in a strong position to deliver integrated building and construction solutions to our clients.

Road maintenance and upgrading works in SarawakGreen Energy Office, Bangi

We have strengthened our core competencies and expanded our portfolio ...

PUTRAJAYA PERDANA BERHAD (465327-P) • Annual Report 2009

PIONEERING SUSTAINABLE BUILDINGS

Over the years, the Group has built a reputation for itself as a leading player in the construction of green and energy efficient buildings in Malaysia. Our landmark projects to date include the Low Energy Office (“LEO”) Building for the Ministry of Energy, Green Technology and Water, the Green Energy Office (“GEO”) for the Malaysia Green Technology Corporation (formerly known as Malaysia Energy Centre) and the Diamond Building for the Energy Commission, among others. The Group is currently undertaking construction of Sarawak Energy Berhad’s energy efficient headquarters in Sarawak and a commercial green building on Lot 2C2 in Putrajaya.

With the Malaysian Government advocating green building development and offering attractive incentives to those opting to go green, the market is expected to be flooded with green building opportunities. The Group will leverage on our proven expertise and strong track record in the development of green or sustainable buildings to tap these opportunities and grow our green building business segment.

CREATING PROMINENT LANDMARKS

Since PPB’s inception, we have been involved in a multitude of landmark commercial, residential and infrastructure projects throughout Malaysia. These include the construction of the majority of the government complexes, offices and high-end residential units within the Federal Government’s administrative capital of Putrajaya. We have also been involved in constructing several prominent commercial and residential projects within the Kuala Lumpur City Centre, some of which have received accolades for their architectural and design excellence.

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corporate profile

BuILdIng the nAtIon’s InFrAstructure

The Group’s infrastructure development expertise today encompasses infrastructure works involving the maintenance and rehabilitation of major roads and pavements. Through CMS Roads Sdn Bhd and CMS Pavement Tech Sdn Bhd, we have formally gained entry into the road and pavement construction and management businesses in the state of Sarawak. We also continue to leverage on our expertise to build the infrastructure for some of Malaysia’s busiest ports, as well as highways, bridges, utility service tunnels and monorail tunnels, among others.

deveLoPIng InnovAtIve ProPertIes

In the high-end residential market segment, we are involved in developing innovative and luxurious high-rise condominiums and energy efficient lake front bungalows. To date, we have had a hand in developing such prominent projects as the

... and are leveraging on our proven track record as builders of landmark

projects and green buildings


Pavilion Residences and One Menerung among others, and we continue to actively promote our exclusive D’Heron At The Lakes energy efficient bungalows. Our property development division also has a strong track record in developing residential properties ranging from apartments, semi-detached houses and super-link houses, to townhouses and bungalows.

LeverAgIng on strong core comPetencIes

We owe our strong growth over the past decade to a strong focus on our core competencies in construction and property development, high standards of quality and efficiency, and a firm commitment to delivering on time without compromise. Our focus on research and cost effective solutions, as well as our openness to exploring innovative technologies, also continue to hold us in good stead. Backed by sound business fundamentals and a strong management team which has the foresight and ability to tap into lucrative new opportunities, PPB is well positioned to deliver on our promises in all our projects and all our markets.

Liquid Bulk Terminal, Port Klang

4C11, the newly completed commercial building in Precinct 4, Putrajaya

corporate profile

PutrAjAyA PerdAnA BerhAd (465327-P) • Annual Report 2009 09

Universiti Teknikal Malaysia Melaka

... to deliver a wealth of integrated building and construction

solutions to our clientsrecognIsed For our eFForts

As a testament to our efforts, the Group’s projects have received international accolades from various organisations in several categories. These include the Malaysian Construction Industry Excellence Awards 2003 (under the Major Engineering Category) for the LEO Building. The LEO Building was also awarded the 2006 ASEAN Energy Efficiency and Conservation Best Practices for Energy Efficient Building Award. These accolades and awards have gone a long way in positioning PPB as an outstanding construction and property development player in the region.

More recently, our commitment to pioneering energy efficiency and green building development won us the “stamp of approval” at the national level when the LEO, GEO and Diamond buildings were showcased on 2009 stamps and first-day covers in support of Malaysia’s green technology initiatives. On top of this, we garnered recognition for our corporate responsibility efforts when we qualified as one of the 20 shortlisted finalists in the CR Awards 2009 event organised by The Star Publications and ICR Malaysia.

In PursuIt oF neW horIZons

Going forward, PPB will continue to leverage on its expertise and strong track record to aggressively pursue new horizons. We will continue to pursue domestic opportunities, seek out new markets and explore growth opportunities that are synergistic to our core competencies. All in all, as we build upon our key strengths, we are setting our sights on becoming a key integrated building and construction solutions provider in the international arena.

The Group remains confident of providing good returns to our shareholders as we bring into play our expertise and experience as proven builders of landmark projects and pioneers of green buildings.

Making a differencethat lasts a lifetime

D’Heron At The Lakes Bungalows with a built-up of approximately 4,900 sq ft

in Precinct 16, Putrajaya

grouP corPorAte structure

ConstruCtion ProPerty DeveloPment

100%Putra Perdana

Construction Sdn Bhd

100%CMS Roads Sdn Bhd

100%CMS Pavement Tech Sdn Bhd

100% Putra Perdana

Development Sdn Bhd

100% Senandung Budiman Sdn Bhd

100% Sarjana Sejati (M) Sdn Bhd

100% Perdana Land Development Sdn Bhd


corPorAte InFormAtIon

BoArd oF dIrectorsKrishnan a/l C K MenonIndependent Non-Executive Director (Chairman)

Dato Sri Mahmud Abu Bekir TaibNon-Independent Non-Executive Director (Deputy Chairman)

Wie Hock KiongNon-Independent Executive Director(Chief Executive Officer)

Tan Vern TactNon-Independent Non-Executive Director

Philip a/l K.O. Kunjappy Independent Non-Executive Director

Monica Oh Chin Chin Non-Independent Non-Executive Director(Alternate Director to Tan Vern Tact)

comPAny secretAryKoo Lai Ngor MAICSA 7022379

AudItorsErnst & YoungChartered AccountantsLevel 23A, Menara MileniumJalan DamanlelaPusat Bandar Damansara50490 Kuala Lumpur, MalaysiaTel : +60 3 7495 8000Fax : +60 3 2095 5332

PrIncIPAL BAnKersMalayan Banking BerhadAmInvestment Bank BerhadAlliance Bank Malaysia Berhad

shAre regIstrArMetra Management Sdn Bhd30.02, 30th FloorMenara Multi-Purpose, Capital Square8, Jalan Munshi Abdullah50100 Kuala Lumpur, MalaysiaTel : +60 3 2698 3232Fax : +60 3 2698 0313

regIstered oFFIce &PrIncIPAL PLAce oF BusIness2nd & 3rd Floor5, Jalan P16, Precinct 1662150 Putrajaya, MalaysiaTel : +60 3 8886 8888Fax : +60 3 8889 5668Website : www.p-perdana.comEmail : [email protected]

stocK eXchAnge LIstIngBursa Malaysia Securities Berhad Main Market

stocK short nAme & codePPEDANA (5117)


BoArd oF dIrectors


1 TAN VERN TACT2 KRISHNAN A/L C K MENON3 WIE HOCK KIONG

4 DATO SRI MAHMUD ABU BEKIR TAIB5 PHILIP A/L K.O. KUNJAPPY

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12

board of directors


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4

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Mr. Wie Hock Kiong was appointed to the

Board of PPB on 9 November 1998. On

29 December 1998, he was appointed as

the Chief Executive Officer of PPB. He is a

member of the Executive Committee.

Mr. Wie graduated with a Bachelor of

Science (Hons) degree in Civil and Structural

Engineering from the University of Aberdeen,

United Kingdom. He is an engineer by

profession and has more than 20 years of

working and management experience in the

fields of civil and structural works locally and

abroad. He has been overseeing the overall

management, development and operations

of PPB Group since the commencement

of business in 1990 via Putra Perdana

Construction Sdn Bhd, a wholly-owned

subsidiary company of PPB. With his

leadership and management, he has

transformed PPB Group to its current sound

financial position, building an excellent track

record with the successful completion of all

projects undertaken.

He does not have any family relationship

with any Director and/or major shareholder

of PPB, nor any conflict of interest in

any business arrangement involving the

Company. He has had no convictions for

any offences within the past 10 years.

ProFILe oF dIrectors

Mr. Krishnan a/l C K Menon was appointed

to the Board of Putrajaya Perdana Berhad

(“PPB”) on 31 May 2003. Mr. Menon is the

Chairman of Remuneration Committee,

Nomination Committee and Employees’

Share Options Scheme Committee. He

is also a member of the Audit Committee

and Executive Committee.

Mr. Menon is a Fellow of the Institute of

Chartered Accountants in England and

Wales, a member of the Malaysian Institute

of Accountants and the Malaysian Institute

of Certified Public Accountants.

He spent 13 years in public practice with

Hanafiah Raslan & Mohamed, of which 7

years as a Partner. He joined Public Bank

Berhad as General Manager and was

subsequently promoted to Executive Vice

President. After serving two public listed

companies, he then joined Putrajaya

Holdings Sdn Bhd (“PJH”) as Chief

Operating Officer from 1997 to 2000.

Mr. Menon is the Chairman of M3

Technologies (Asia) Berhad and currently

sits on the board of MISC Berhad, SPK-

Sentosa Corporation Berhad, SCICOM

(MSC) Berhad, UBG Berhad (“UBG”) and

PJH.







Dato Sri Mahmud was appointed to the

Board of PPB on 19 September 2008.

Having pursued his tertiary education in

USA and Canada, Dato Sri Mahmud has

extensive experience in stock-broking and

corporate sectors. He was a founding

member of Sarawak Securities Sdn Bhd,

Sarawak’s first stock-broking company

which is now merged with Kenanga

Investment Bank Berhad.

Dato Sri Mahmud is the Chairman of UBG,

the holding company of PPB. He is the

Deputy Group Chairman of Cahya Mata

Sarawak Berhad (“CMS”) and a major

shareholder of CMS.

Dato Sri Mahmud also sits on the Board

of Sarawak Cable Berhad and CMS’s

subsidiaries that involved in construction,

construction materials, financial services,

property development and technology.

Dato Sri Mahmud is a board representative

of UBG. He does not have any conflict

of interest in any business arrangement

involving the Company. He has had no

convictions for any offences within the past

10 years.


KrIshnAn A/L c K menon

Independent Non-Executive DirectorChairmanMalaysian, Age 60 years

dAto srI mAhmud ABu BeKIr tAIB

Non-Independent Non-Executive DirectorDeputy ChairmanMalaysian, Age 46 years

WIe hocK KIong

Non-Independent Executive DirectorChief Executive OfficerMalaysian, Age 49 years

Mr. Tan Vern Tact was appointed to the

Board of PPB on 10 March 2008. He

is a member of the Audit Committee,

Remuneration Committee, Nomination

Committee, Employees’ Share Options

Scheme Committee and Executive

Committee.

Mr. Tan graduated with a Bachelor of Arts

(B.A.) and a Master of Engineering (M. Eng.)

in Electrical and Information Sciences from

Trinity College, University of Cambridge,

United Kingdom.

He currently sits on the Board of Loh & Loh

Corporation Berhad (“LLCB”) and UBG

(as alternate director) and UBG Enterprise

Berhad.

Mr. Tan is a board representative of UBG.







profile of directors

Mr. Philip a/l K.O. Kunjappy was appointed

to the Board of PPB on 10 March 2008. He

is the Chairman of the Audit Committee and

Executive Committee. He is a member of

the Remuneration Committee, Nomination

Committee and Employees’ Shares Option

Scheme Committee.

Mr. Philip is a qualified accountant and

is a Fellow of the Institute of Chartered

Accountants in England and Wales, and

a member of the Malaysian Institute of

Certified Public Accountants.

He had served Attlee, Edge & Lambert,

United Kingdom, Price Waterhouse, Kuala

Lumpur Kepong Berhad and Island &

Peninsular Berhad before joining Felda

Holdings Berhad (“Felda”) in March 2006.

He is currently the Senior Executive Director

of Felda’s Corporate Planning and a Board

member of several Felda’s subsidiaries. He

is also an active member of the Malaysian

Institute of Management, the Malaysian

Institute of Accountants and the Malaysian

Institute of Taxation.








tAn vern tAct

Non-Independent Non-Executive DirectorMalaysian, Age 33 years

PhILIP A/L K.o. KunjAPPy

Independent Non-Executive Director Malaysian, Age 53 years

monIcA oh chIn chIn

Alternate Director to Mr. Tan Vern TactMalaysian, Age 49 years

Ms. Monica Oh Chin Chin was appointed as

the Alternate Director to Mr. Tan Vern Tact

on 3 July 2009.

Ms. Oh graduated from Monash University,

Australia in 1982 with a Bachelor of

Economics majoring in Accounting. She

is a member of the Malaysian Institute of

Accountants and CPA Australia.

Ms. Oh joined UBG as a General Manager,

Finance & Administration in September

2002. She was subsequently appointed

as the Company Secretary of UBG on 26

December 2002 before she assumed the

current position as the Executive Director,

Finance & Administration of UBG on

1 November 2008. Prior to joining UBG,

Ms. Oh has served in a foreign bank in

Malaysia and has more than 13 years of

banking experience.

She currently sits on the Board of LLCB as

Alternate Director to Mr. Tan Vern Tact.

She does not have any family relationship




Company. She has had no convictions for


ProFILe oF senIor mAnAgement


Mr. Cheah Ham Cheiaa Malaysian, is our Deputy Chief Executive Officer. He graduated with a Bachelor of Science degree in Civil Engineering from the University of Aberdeen, United Kingdom.

He has more than 30 years of hands-on working experience gained through various projects including major civil infrastructure works, and the construction of jetties, buildings, factories, water-treatment plants and fertilizer plants.

He has been with the Group since June 1994 and was promoted to the position of Deputy Chief Executive Officer in August 2007. Prior to his employment with PPB, he was attached to a leading international construction company and was actively involved in multi-million dollar projects in Malaysia as well as abroad such as Sri Lanka, Bangladesh and Singapore.

He currently oversees the Group’s operations, which include implementing policies to achieve the Group’s commercial objectives, medium and long terms goals, as well as to maximize the Group’s profit and efficiency.

He also sits on the board of PPB’s subsidiary companies.

Mr. Sit Kam Hocka Malaysian, is our Chief Financial Officer. He heads the finance department overseeing the Group’s accounting, finance and corporate matters.

He is a member of the Malaysian Institute of Certified Public Accountants and the Malaysian Institute of Accountants and a Fellow member of CPA Australia.

He was attached with international firms of Chartered Accountants both in Malaysia and Australia where he specialised in auditing and consultancy before joining the commercial sector. He left the accounting profession in 1989 and joined the commercial sector in various positions.

He has over 20 years of consultancy, finance and accounting experience.

Mr. Teh Kian Huata Malaysian, is our Senior General Manager responsible for the Group’s building projects.

He holds a Bachelor of Civil Engineering degree and has been with PPB for 18 years.

He has 23 years of vast experience in the building construction industry, in particular the design and building works involving roads, bridges, water treatment plants, sewerage plants, resorts, office buildings and commercial complexes.

Prior to joining the Group in July 1991, he was attached to a Singapore-based construction company for three (3) years as the site engineer for projects involving high-rise buildings, refurbishment and residential construction.

Mr. Yong Khoon Senga Malaysian, is our Senior General Manager in charge of the Group’s infrastructure projects.

He is a civil engineer registered with the Board of Engineers in Malaysia. He graduated in 1984 with Bachelor of Science (Hons) degree and in 1985 with a Master of Science degree in Structural Engineering from University of Louisiana, USA.

His vast job experience of approximately 24 years covers site supervision, contract administration, project planning and implementation, and tendering of civil and infrastructure works.

He joined the Group in August 1997 as a Senior Project Manager, mainly handling the tendering and management for the implementation of projects. He was promoted to Assistant General Manager in January 2001, elevated to the position of General Manager in January 2004 and promoted as the Senior General Manager in July 2007.

His current portfolio includes tendering and proposing for potential projects as well as managing and administering civil and infrastructure projects.

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profile of senior management


Mr. Bu Teng Chenga Malaysian, is our Senior General Manager in charge of property development and management.

He holds a Diploma in Mechanical Engineering from Universiti Teknologi Malaysia and a Bachelor of Science degree in Civil Engineering from Louisiana State University, USA.

He has more than 20 years of experience in construction and development projects. His involvement in development covers overall conceptualization, sales, administration, and completion of large mixed development projects as well as management and maintenance of residential and commercial buildings.

His current portfolio encompasses planning, design and implementation of energy efficient buildings and sustainable development.

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Mr. Goh Ceah Chuanga Malaysian, is our Senior General Manager heading the Abu Dhabi branch office in United Arab Emirates.

He holds a Bachelor of Science degree in Civil Engineering from the University of Aberdeen, United Kingdom. He is registered as a Professional Engineer with the Board of Engineers, Malaysia and is also a member of the Institute of Engineers, Malaysia.

He has approximately 28 years of experience in the construction and construction related manufacturing industries which include Pre-contract, Implementation and Post Contract Management of both infrastructure and building projects. He was also responsible for the setting up of Ready-Mix Concrete plants and cement sand brick factories for a local public listed company.

Prior to joining the Group in March 2007, he was attached to Dewan Bandaraya Kuala Lumpur, a leading international construction company, a public listed company and several other construction companies.

Mr. Chia Peng Haia Malaysian, is our Senior General Manager responsible for the building projects.

He holds a Bachelor of Engineering (Honours) degree from Monash University, Australia. Mr. Chia has more than 20 years experience in the construction industry. His varied experience encompasses corporate business planning, project development and construction of infrastructure and building projects. The key scopes of duties include liaison with public authorities, business planning and development, operations management, project planning and implementation, tendering, contract management and staff management.

He joined the Group in June 2008 and currently oversees several building projects undertaken by the Group. Prior to joining the Group, he was attached to a public listed company and several other leading construction companies.

Mr. Lim Jit Yawa Malaysian, is our Senior General Manager effective June 2009, in charge of the CMS Roads Sdn Bhd (“CMSR”) and CMS Pavement Tech Sdn Bhd (“CMSPT”) operations in Sarawak.

He is an engineer by profession and graduated with a Bachelor of Mechanical Engineering Degree from the University of New South Wales, Australia. He is a member of the Board of Engineers in Malaysia and currently, the Vice Chairman of Kuching Section, Malaysian Chapter’s American Society of Heating, Refrigerating and Air-conditioning Engineers, Inc.

He joined PPES Works (Sarawak) Sdn Bhd (“PPESW”) since year 2006. He was appointed as the Head of Federal Road Maintenance of PPESW before being promoted as the Senior General Manager of CMSR and CMSPT.

Prior to his employment with PPESW, he has more than 10 years of hands-on working experience gained through various projects in the field of construction, mechanical and electrical systems. He was an associate director of Maunsell NVOF Sdn Bhd, a consulting engineering company focusing on overall project conceptualization and system planning, designing, project management, administration, tendering and contract administration. Subsequently, he was with CMS Group in charge of building construction, fleet management and federal road maintenance.

Mr. Alexander Lo Tzone Leonga Malaysian, is our Senior General Manager responsible for the Group’s building projects.

He holds a Master of Science degree in Construction Management from Wilmington Advance University, USA and has approximately 18 years of working experience in the construction industry.

He joined the Group in 1994 and is now responsible for managing the construction of various high-rise commercial and luxury residential icons within the Kuala Lumpur city centre. Aside from this, he has been involved in the management and construction of landed residential buildings, offices, interior fit-outs and recreational development projects.

His current portfolio includes tendering and developing proposals for potential projects, as well as managing and administering the Group’s building projects.

Better outcomesfor better lives

A nigth view of the brightly lit 4C11, Putrajaya

Dear Shareholders,The year 2009 was an exciting one for Putrajaya Perdana Berhad (“PPB” or “the Group”). After being weighed down by the preceding year’s flood of challenges, the construction sector began to strengthen again in 2009 in tandem with the recovering domestic economy. Against this backdrop, the Group made strong strides forward on all fronts to turn in a commendable performance for the year ended 31 December 2009. The addition of new road and pavement maintenance subsidiaries to our portfolio did much to strengthen our overall offering and earnings base. Together with our proven track record in green building construction and a bolstered infrastructural capability, the Group is in a stronger position today to deliver integrated building and construction solutions to our clients.

chAIrmAn’s stAtement


Krishnan a/l C K MenonChairman

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On behalf of the Board of Directors of PPB, I am pleased to present the Annual Report and Audited Financial Statements of the Group and the Company for the financial year ended 31 December 2009.

oPerAtIng envIronment

2009 was the year in which the global economy began to show positive signs of recovery following a period of deep global recession. Unprecedented intervention by various governments to support demand as well as ease uncertainty and systemic risk in financial markets, helped stabilise economic activity and foster modest growth in some countries. In general, emerging and developing countries were further ahead on the path to economic recovery led by the resurgence in Asia.

2009 was also the year in which the Malaysian economy set out on the slow but sure pathway to recovery. The domestic economy registered a GDP contraction of 6.2% in the first quarter (“Q1”), followed by a smaller contraction of 3.9% in Q2 that materialised on the back of a rebound in the external sector. In Q3, the Malaysian economy experienced a GDP contraction of only 1.2% due to a rebound in the manufacturing. In Q4, the domestic economy registered GDP growth of 4.5% as a result of strengthening domestic and external demand. All in all, the Malaysian economy posted a GDP contraction of 1.7% in 2009, stronger than initially forecast.

On the sectoral front, the construction sector fared better than most, registering positive growth of 1.1% in Q1 of 2009 following a contraction of 1.6% in Q4 of 2008. The sector then went on to register 4.5%, 7.9% and 9.2% growth in Q2, Q3 and Q4 of 2009 respectively following the implementation of construction projects under the Government’s economic stimulus packages to aid domestic recovery. This included a RM60 billion stimulus

package announced in March 2009 on top of the initial RM7 billion stimulus package announced in November 2008.

FInAncIAL PerFormAnce

Amidst this strengthening operating environment, the Group leveraged on the many opportunities in hand to generate revenue of RM866.0 million and profit before tax (“PBT”) of RM69.6 million for financial year ended 2009 (“FY2009”) compared to FY2008’s revenue of RM864.9 million and PBT of RM39.4 million.

The acquisition of the road and pavement construction and management operations of CMS Roads Sdn Bhd (“CMSR”) and CMS Pavement Tech Sdn Bhd (“CMSPT”) impacted positively on our overall earnings - contributions from these two companies alone amounted to approximately 32% of our profit.

The activities of our Construction Division too, continued to strengthen our overall earnings even as several projects were brought to a closure and ongoing projects were carried out. We gained good momentum in the green building segment, while our Property Development Division continued with its efforts to market our energy efficient D’Heron At The Lakes bungalows.

dIvIdend PAyments

In view of the year’s good results, the Board is pleased to recommend a final single tier dividend of 5 sen per share in respect of the financial year ended 31 December 2009. Including an earlier interim single tier dividend of 6 sen per share, the total proposed and declared dividend for FY2009 is 11 sen per share, representing a payout ratio of 31% of the Group’s net profit for the financial year.

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Suruhanjaya Tenaga’s green headquarters, Diamond Building, Putrajaya

chairman’s statement


strAtegIc deveLoPments

Infrastructure Capability Strengthened

On 12 May 2009, we completed the acquisition of our entire equity stake in CMSR and CMSPT from our holding company UBG Berhad for an aggregate cash consideration of RM75.0 million. Our strategic move to get involved in the maintenance of state roads in East Malaysia has certainly strengthened our existing infrastructure capability. Moreover, it is providing us with a recurring stream of revenue that will help balance out the lumpy earnings from our core construction business. While the operations of these two businesses were already profitable before we acquired them, we believe we can make them more efficient and focused by bringing into play the operational procedures and efficiencies that PPB is renowned for.

Over the course of FY2009, we also turned our attention towards high-end infrastructure project implementation to bolster our earnings base. I am delighted to announce that we secured the Tanjung Agas gas supply base and marine services infrastructure development project in Pahang, a significant incentive by the Government to develop Malaysia’s Eastern Economic Corridor. Our success in winning our client’s trust and setting high standards among suppliers, as well as paying close attention to the detail and quality of this project, continues to make us stand out amongst our peers. Even as we leverage on our strong track record of undertaking iconic jobs as well

as bring our existing expertise in infrastructure development into play, we are strengthening our foothold in the infrastructure segment and opening the door to other such opportunities.

Green Building Activities Gain Recognition

The year also saw us gaining momentum and recognition as a pioneer in green building construction. As a testament to our commitment to pioneering green and energy efficiency building development, three of our landmark projects, namely the Low Energy Office (“LEO”), the Green Energy Office (“GEO”), and the Diamond Building, were awarded the “stamp of approval” at national level when they were showcased on 2009 stamps and first-day covers highlighting Malaysia’s green technology initiatives. We are grateful that our strategy of taking the green route has paid off handsomely and we will continue to leverage on this to drive the Group’s performance. With the Malaysian Government advocating sustainable building construction and green technology usage, as well as providing several tax incentives, our involvement in the huge, untapped green building segment bodes well for us.

Potential Change to Listing Status

Several changes have taken place on the shareholder front these the last few months which may affect the Group’s listing status going forward. On 29 December 2009, a privately-owned oil exploration and production company, PetroSaudi

CMSPT conducting cement stabilisation work



One Menenung, Bangsar

International Ltd (“PSI”) announced its intention to privatise and delist our holding company, UBG Berhad (“UBG”), once it had completed acquiring stakes in the company currently held by UBG’s three major shareholders, namely Majestic Masterpiece Sdn Bhd (“MMSB”), Concordance Holdings Sdn Bhd (“CHSB”) and PPES Works Sarawak Sdn Bhd (“PPESW”). On 8 January 2010, PSI announced that it had received conditional acceptances from these major shareholders of UBG.

Upon PSI completing the acquisition of the stakes held by MMSB, CHSB and PPESW, it will end up holding more than 33% of UBG shares, which will trigger off a mandatory general offer (“MGO”) for all the shares not already held by PSI. Once the MGO has been triggered at the UBG level, PSI will also be automatically obliged to make an MGO for the remaining ordinary shares it does not hold in UBG’s subsidiaries, namely Loh & Loh Corporation Bhd (“LLCB”) and PPB. This will eventually lead to the take over and delisting of LLCB and ourselves. At the time of writing, neither UBG nor the Group have received any notice of a takeover from PSI or its nominees pursuant to the Malaysian Code on Takeovers and Mergers. Upon enquiry with UBG’s shareholders, we understand that the proposed acquisition of UBG has yet to be completed.

corPorAte governAnce

The Board is committed to upholding the tenets of integrity, transparency and accountability in all that we do. As such, we

continue to bring effective corporate governance practices into play to create the utmost value for our shareholders as well as to protect the Group’s reputation and stakeholders’ interests. Our Statement on Corporate Governance, the Audit Committee Report and the Statement on Internal Control found on pages 42 to 58 of this Annual Report, spell out the stringent internal and external controls and measures in place to ensure good corporate governance practices are adhered to.

corPorAte resPonsIBILIty

PPB believes in carrying out responsible practices that create value and ensure the sustainable growth of our businesses, employees, customers, shareholders, partners and the communities and environment that we operate in. In 2009, we continued to implement various impactful corporate responsibility (“CR”) measures in the areas of the marketplace, workplace, environment and community. Our initiatives included implementing more stringent safeguards to protect all onsite workers and sub-contractors, implementing an upgraded integrated management system to ensure the highest standards throughout all work processes, and undertaking measures to provide employees a more conducive workplace plus better benefits.

New face-lift of Bangsar Shopping Complex

Mr. Wie receiving the finalist CR 2009 Award

from Star Publications Bhd Group Managing

Director/CEO Datuk Linda Ngiam and ICR

Malaysia Chairman Datuk Johan Raslan



On top of this, we undertook environmental sustainability initiatives that included impactful recycling activities and the second run of the PPB Green Lecture Tour series, while community outreach initiatives such as our Charitable Homes and Schools Adoption Programmes, aid to an orang asli settlement in Pekan, as well as complementary infrastructural works, brought tangible benefits to our target audiences.

Details of the abovementioned initiatives and a host of other impactful ones can be found in our CR Report on pages 64 to 76 of this Annual Report. As a result of our efforts, PPB qualified as one of the 20 finalists shortlisted from more than 300 participating public listed companies in the running for the recent CR Awards 2009 competition organised by The Star Publications and ICR Malaysia.

outLooK And ProsPects

Malaysia is expected to emerge from a technical recession in 2010 with leading economic indicators suggesting that the economy will maintain its steady rising trend in the coming months. The construction sector is set to be bolstered further as the Government rolls out several mega infrastructural projects under the 10th Malaysia Plan. These will include the

multi-billion ringgit Low Cost Carrier Terminal (“LCCT”) project adjacent to the Kuala Lumpur International Airport; the Pahang-Selangor Water Transfer (“PSWT”) project and the Light Rail Transit (“LRT”) extensions project.

To spur private sector involvement in the development of Malaysia’s economic corridors, the Government had set aside RM3.5 billion this year for infrastructure and basic amenities in the corridor regions. The property market is also expected to rise in 2010 as both developers and consumers regain their confidence amidst strengthening economic conditions.

Given this optimistic outlook, the Board is confident about the Group’s prospects for FY2010. We anticipate securing several new jobs as we pursue mega infrastructure projects like the LCCT, PSWT and LRT extensions. On top of this, the Group also expects to reap the benefits of having a constant stream of revenue flowing in from our road and pavement construction and management operations in East Malaysia. We are also actively seeking out more opportunities in the green building segment and exploring opportunities in the fast recovering high-end property segment. Even as we move forward to tap new opportunities, we will continue to be prudent about which clients we take on, especially in the wake of the global credit crunch.

The newly completed 4C11 commercial building located

at Precinct 4, Putrajaya

Berth 11 & 12 of Pelabuhan Tanjung Pelepas (Phase 2), Johor

“The Board is confident about the Group’s prospects for FY2010. We anticipate securing several new jobs as we pursue mega infrastructure projects and expect to reap the benefits of having a constant stream of revenue flowing in from our East Malaysian operations.”



All in all, we will focus our efforts on undertaking projects that solidify the Group’s position as an integrated building and construction solutions provider. We are confident that our experience and expertise, adherence to quality, on-schedule delivery time, and competitive pricing, will continue to hold us in good stead as we pursue new opportunities. However, be assured that we are not resting on our laurels, but are already working hard to replenish our order book. Even as we move forward to aggressively tender for new projects, we are confident of securing a total order book exceeding RM2 billion in FY2010 from both public and private sector projects.

APPrecIAtIon

On behalf of the Board of Directors I wish to convey my sincere gratitude to all our past shareholders for your steadfast support and confidence in the Group.

My sincere appreciation also goes to the Malaysian Government and regulatory authorities as well as the Group’s business partners, clients, bankers, consultants, sub-contractors and suppliers for their staunch support. PPB looks forward to strengthening its relationships with all of you as we work together for our common benefit.

Our management and employees continue to display their unwavering dedication to the Group and this is especially noteworthy amidst the many challenges we have faced. I thank them for standing by us and for the immense hard work, sacrifices and worthy contributions they have made. The Board wishes to extend its utmost gratitude to Dato’ Ong Gim Huat, our fellow director who has resigned from the Board. We thank him for his worthy contributions and dedication towards the Group and wish him every success in his new endeavours. We also bid welcome to Ms. Monica Oh Chin Chin who comes onboard as an alternate director to Mr. Tan Vern Tact and we look forward to her contributions.

As the Group moves forward to explore new opportunities and tackle all challenges on our journey to success, I trust that all our stakeholders will continue to lend us their steadfast support.

Krishnan a/l C K MenonChairman

The overall view of the Universiti Teknikal Malaysia Melaka campus

ceo’s revIeW oF oPerAtIons

Putrajaya Perdana Berhad (“PPB” or “the Group”) turned in a strong performance in 2009 amidst an economy on the pathway to recovery. Our impressive performance came on the back of strong earnings from our newly acquired road and pavement maintenance businesses in East Malaysia, as well as our focus on green building construction. Today, we continue to build upon on our position as a key provider of integrated building and construction solutions by undertaking more high-end infrastructural projects.

Wie Hock KiongChief Executive Officer


constructIon ActIvItIes on the uPtrend

FY2009 saw subsidiary Putra Perdana Construction Sdn Bhd (“PPC”) making strong inroads on the construction front. PPC successfully brought several projects to their full completion which included the 368-unit Pavilion Residences luxury service residential towers in Kuala Lumpur, retrofitting works for the facade of the Bangsar Shopping Centre (Phase 2) as well as construction works for both the ICT Data Centre and 4C11 projects in Putrajaya. PPC also completed the six-block 229-unit One Menerung high-end condominium project in Bangsar for Bandar Raya Developments Berhad; the Wharf 11 & 12 project in Johor for Pelabuhan Tanjung Pelepas; and the Diamond Building project in Putrajaya for the Energy Commission.

At the time of writing, projects which are close to completion include Packages 2B(ii) and 2C of Universiti Teknikal Malaysia Melaka’s campus in Melaka, and the retrofitting works for the final phase of the Bangsar Shopping Centre, together with the construction of office blocks and an annexe to the shopping centre. The Group has several other ongoing projects, among which is the construction of the 50-storey high Wisma Felda in Platinum Park near the Kuala Lumpur City Centre. While the Government’s stimulus packages and its focus on developing low-medium cost housing certainly helped drive the overall growth of the construction sector in 2009, the Group experienced a slowdown in construction activities pertaining to our high-end condominium and office projects. With the high-end property market experiencing flattish demand in 2009, we focused our efforts on securing more infrastructural projects under the Government’s stimulus packages. As a result, we bagged Package 1 and 2 of the infrastructure development works project for the Tanjung Agas gas supply base and marine services in Taman Industri Minyak & Gas dan Maritime, Pekan, Pahang. Our scope-of-work primarily involves the development of roads for the Tanjung Agas industrial area and we expect this project to contribute towards our 2010 revenue.


On the international front, activities at our Abu Dhabi branch office have been slow with the exception of our overseeing construction of a commercial building for Mr. Mallalla Mubarak Suwaid Al Ameri. While we remain optimistic about our prospects in this region, we are adopting a cautious stance towards new project implementation in light of the financial difficulties that Middle Eastern cities like Dubai have encountered.

green BuILdIng segment gAIns momentum

Since early 2000, we have built up a reputation for ourselves as for a leading player in the construction of green and energy efficient buildings in Malaysia and we continue to make strong inroads in the green building segment. On top of landmark projects like the Low Energy Office (“LEO”) for the Ministry of Energy, Green Technology and Water, the Malaysia Green Technology Corporation’s Green Energy Office (“GEO”) and the Diamond Building for the Energy Commission, we are working to complete the Sarawak Energy Berhad headquarters in Kuching. This building, which is currently in consideration to be upgraded from an energy efficient building to a full-fledged green building, is scheduled for completion in 2011.

We are also in the midst of constructing a RM181.8 million commercial green building on Lot 2C2 in Putrajaya. The 2C2 project incorporates the latest green technology features including the use of double glazing with low E-coating to reduces the transfer of heat into the building as well as ensures optimal energy savings and water harvesting. The 2C2 green commercial building is expected to be completed in 2012.

The green building movement recently received a boost when the Government announced a tax exemption for green building owners in its 2010 Budget. The launch of Malaysia’s very own Green Building Index (“GBI”) in April 2009 plus the formal setting up of the Malaysia Green Building Confederation or MGBC (of which we are a founding member) also bodes well for us. With the Government driving the green building agenda and several attractive incentives already in place for those going green, we

29

50-storey Wisma Felda atPlatinum Park, Kuala Lumpur

The commercial building for Mr. Mallalla Mubarak Suwaid Al Ameri in Abu Dhabi, UAE


ceo’s review of operations

Piling work in progress at the Tanjung Agas project

30

anticipate a surge in retrofitting and new green building projects in the near future. These developments will enable us to bring into play our proven expertise and track record in the development of sustainable buildings.

The Energy Commission’s Diamond Building is all set to receive the Green Mark Platinum certification from Singapore’s Building and Construction Authority. This accolade is apt reflection of our prowess in the green building segment and it also sets the benchmark for future high-end green building construction activities in Malaysia. The 2C2 office suites too, is aiming to set high standards in sustainable development and is currently being upgraded to achieve the Gold Rating under the GBI. Going forward, we aim to take the green message everywhere we go and influence our clients to demonstrate their commitment towards sustainable development.

roAd And PAvement BusInessesdeLIver strong resuLts

May 2009 marked the Group’s formal entry into the road and pavement construction and management businesses via the acquisition of CMS Roads Sdn Bhd (“CMSR”) and CMS Pavement Tech Sdn Bhd (“CMSPT”). The integration of these

two companies into our portfolio has boosted the Group’s earnings considerably as well as strengthened our position as an integrated building and construction solutions provider.

Today, CMSR is responsible for maintaining over 4,600 km of roads throughout Sarawak under a 15-year concession agreement (beginning 1 January 2003) with the Sarawak State Government. Using an internationally recognised road maintenance management system, CMSR undertakes routine and periodic maintenance activities. CMSPT on the other hand, is a specialist provider of construction, maintenance and rehabilitation technology for road pavements. Apart from being an environmentally friendly company and promoting sustainable engineering and construction, CMSPT utilises technology that ensures cost savings, speed of construction, as well as improved pavement performance and life span. We remain open to exploring the opportunity to take the expertise of these companies elsewhere.

comPetItIve edge shArPened

In 2009, we implemented various initiatives to enhance our competitive edge and make us an even more efficient organisation.

Sarawak Energy Berhad’s Head Office, Kuching



31

Bangsar Shopping Complex Annex, Phase 3

Human Capital Strengthened

On the human capital side, we continued to nurture our employees into a finely-honed workforce. We invested in effective employee training and development opportunities as well as provided them the tools to help them keep abreast of the latest industry developments. Group employees who were sent for in-depth training relating to GBI certification were able to successfully cascade this knowledge down throughout the entire organisation. Our people are now beginning to have a strong grasp of green building construction and sustainable development concepts which ties in neatly with our green agenda.

We also continued to implement effective talent management programmes and offer competitive remuneration and benefits to attract and retain talented employees. This is all the more important given the shortage of skilled workers in the construction sector. Following the assimilation of new subsidiaries CMSR and CMSPT into our fold in 2009, our employee numbers doubled overnight. In line with this, our management team set in place a more detailed and structured human management system while taking greater responsibility for aligning the business objectives and strategies of all our subsidiaries.

Operational Efficiencies Enhanced

PPB has very clear cut operating procedures in place and this has made us very efficient. In fact, our operational and cost efficiencies are currently at their optimum level. We know which areas to focus on and are continuously taking steps to improve weaker ones. From risk mitigation and assessment of clients, to operational implementation and handing over of projects - we have built up a solid reputation in the industry and are renowned for our best practices. Having said that, there is always room for improvement in any area and we will continue to uphold and implement effective and prudent operational practices in all that we undertake.

Worker Health and Safety Enforced

The health and safety of our workforce is of paramount importance and the Group’s companies went out of their way in 2009 to provide a safe and conducive working environment for our employees and all those who came into contact with our project sites. To ensure worker and public safety, we continued to install leading-edge safety panelling throughout our high-rise building projects, increase the use of appropriate safety systems and step up enforcement activities. We also undertook


2C2, another up and coming commercial green building in Putrajaya“Going forward into 2010, the Group is determined to intensify its business development activities and we will seek new opportunities to bolster our position as an integrated building and construction solutions provider.”

site safety audits which stressed systematic and meticulous information and knowledge sharing, plus intensified health and safety training among our workforce.

Management Control Systems Integrated

We are continuously enhancing our quality control systems to ensure the smooth delivery of high quality business processes, services and products. 2009 saw us integrating all three of our management systems – the ISO 9001 quality management system, ISO 14001 environmental management system and OHSAS 18001 occupational health and safety management system – under an umbrella Integrated Management System (“IMS”). With this IMS in place, we are one of the few industry players to have such a comprehensive list of operational standards. Going forward, our work will now be audited in accordance with international standards thereby making us a more efficient construction company and enhancing our credibility with clients.

The year also saw us implementing our very first 5-S Programme at the 50-storey-high Wisma Felda building with maximum safety features in place. The 5-S management system is a set of practices that provide an organised approach to

good housekeeping at workplace. Through tapping the 5-S management system we are motivating our people, improving safety, efficiency and productivity, as well as moving closer towards our goal of achieving Total Quality Management and becoming the first SIRIM-accredited 5-S construction firm in Malaysia.

movIng AheAd

With economic indicators showing that the Malaysian economy is on a definite uptrend, the Group is looking forward to achieving a much better year.

Going forward into 2010, PPB is determined to intensify its business development activities and we will seek new opportunities to bolster our position as an integrated building and construction solutions provider. Success in the building construction market today is dependent on players’ ability to integrate a wealth of solutions which now include green building solutions, financial strength, a skilled workforce and technological innovation. Currently not many industry players are able to offer such an expertise so we have a good head start over others with our integrated solutions offering.



“With our strong balance sheet, new controlling shareholders as well as an experienced management team at the helm, PPB is confident of maintaining its profitability in FY2010.”

CMSPT constructed the access road and car park for the Borneo Convention Centre Kuching

As government has increased its spending by implementing several mega infrastructure projects like the Low Cost Carrier Terminal adjacent to the Kuala Lumpur International Airport, the Pahang-Selangor Water Transfer project and the Light Rail Transit extensions projects, we will work towards securing one of them. We also anticipate our earnings to increase in the high-end property segment even as this market begins to show signs of recovery in the first quarter of 2010. We will also continue to leverage on opportunities in the green building sector.

All in all, we are confident of securing a total order book exceeding RM2 billion in FY2010. Add to this, with the recurring revenue from our road and pavement construction and management operations, we are confident of growing our earnings base in the new financial year. Going forward, our management team will continue to explore all avenues for growth as well as mitigate the impact of external factors on our business. With our strong balance sheet, new controlling shareholders as well as an experienced management team at the helm, PPB is confident of maintaining its profitability in FY2010.

In APPrecIAtIon

On behalf of the Board of Directors of PPB, I wish to convey my appreciation to our shareholders, the regulatory authorities, financiers, partners and all others for their support. I especially

want to thank our clients, particularly those who have been supportive of the Group’s direction to go green. I am grateful to our consultants, suppliers and sub-contractors for their dedication and commitment to delivering quality work, on time and within budget. We look forward to continuing with these mutually beneficial business relationships and to forging strong new partnerships.

I wish to thank my colleagues on the management team and our staff for their hard work and unfailing dedication towards the Group. Their efforts in boldly taking on the many challenges we faced and selflessness in performing their daily tasks, have ensured the smooth running of our operations and helped drive our performance. I trust all our stakeholders will continue to lend us their support as we endeavour to deliver another year of strong results.

Wie Hock KiongChief Executive Officer


Providing knowledgethat shapes solutions

Hydraulic excavator laying road base

material during pavement re-construction

grouP FInAncIAL hIghLIghts


Revenue (RM million) Profit Before Tax (RM million) Net Assets Per Share (sen)

08070706 09

Financial Year Ended 31 Dec

9-monthPeriodEnded31 Dec

FinancialYear Ended31 March

435.3

537.3

336.1

864.9866.0

070706




45.4

52.7

37.939.4

69.6

070706




137.2

104.5

119.1

104.5

129.1

08 09 08 09

In RM Million 9-month (except otherwise indicated) Financial Year Ended Period Ended Financial Year Ended 31 Dec 2009 31 Dec 20082 31 Dec 2007 31 Mar 2007 31 Mar 2006

Revenue 866.0 864.9 336.1 537.3 435.3

Profit before tax 69.6 39.4 37.9 52.7 45.4

Profit attributable to shareholders 50.2 27.9 30.0 38.5 32.5

Total assets 654.2 763.8 433.6 482.9 403.9

Shareholders’ equity 180.7 146.2 166.1 141.1 164.6

Share capital - issued & fully paid 70.0 70.0 69.7 67.5 20.0

Return on average shareholders’ equity (%) 30.7 17.9 19.6 25.2 21.9

Return on total assets (%) 7.7 3.7 6.9 8.0 8.0

Basic earnings per share (sen) 35.8 20.0 21.9 29.9 27.11

Gross dividend per share (sen) 11.03 5.0 9.0 11.0 79.41

Net dividend per share (sen) 11.03 5.0 9.0 8.0 57.21

Net assets per share (sen) 129.1 104.5 119.1 104.5 137.21

Notes:1 The computation have been adjusted based on paid-up share capital of 120,000,000 ordinary shares of RM0.50 each after the bonus issue and share split,

assuming the bonus issue and share split which were completed in August 2006, had taken place since the beginning of the financial year ended 31 March 2006.

2 The Group’s financial statements have been prepared based on merger method of accounting in relation to the acquisition of two subsidiaries. Accordingly, certain comparatives figures for the financial year ended 31 December 2008 have been restated as if the merger had been effected since 1 September 2008.

3 Included a proposed final single tier dividend of 5 sen per share, to be approved by the shareholders at the forthcoming Annual General Meeting.

quArterLy PerFormAnce

FInAncIAL cALendAr


FInAnCIAL YEAR EnDED 31 DECEMBER 2009

Announcement of Results:

1st Quarter Results ended 31 March 2009 14 May 2009

2nd Quarter Results ended 30 June 2009 18 August 2009

3rd Quarter Results ended 30 September 2009 19 November 2009

4th Quarter Results ended 31 December 2009 22 February 2010

Others:

Notice of entitlement for final single tier dividend of 5 sen per share 7 April 2009for the financial year ended 31 December 2008

Book closure date for payment of final single tier dividend of 5 sen per share 6 May 2009for the financial year ended 31 December 2008

11th Annual General Meeting & Extraordinary General Meeting 30 April 2009

Payment of final single tier dividend of 5 sen per share for the financial year ended 31 December 2008 13 May 2009

Notice of entitlement for interim single tier dividend of 6 sen per share for the financial year ended 31 December 2009 19 November 2009

Book closure date for payment of interim single tier dividend of 6 sen per share 8 December 2009for the financial year ended 31 December 2009

Payment of interim single tier dividend of 6 sen per share for the financial year ended 31 December 2009 16 December 2009

Announcement of the proposed final single tier dividend of 5 sen per share for the financial year ended 22 February 201031 December 2009 subject to the shareholders’ approval at the forthcoming Annual General Meeting

FOR THE FInAnCIAL YEAR EnDED 31 DECEMBER 2009

Quarter 1 Quarter 2 Quarter 3 Quarter 4 YearIn RM Million ended ended ended ended ended(except otherwise indicated) 31 Mar 2009 30 Jun 2009 30 Sep 2009 31 Dec 2009 31 Dec 2009

restated 1

Revenue 251.7 228.2 199.9 186.2 866.0

Profit before interest and tax 11.8 13.3 18.1 32.9 76.1

Profit after tax 7.4 7.3 12.2 23.3 50.2

Profit attributable to equity holders of the Company 7.4 7.3 12.2 23.3 50.2

Earnings per share (sen) 5.3 5.2 8.8 16.5 35.8

Dividends per share (sen) - - 6.0 5.0 2 11.0

Note:1 The Quarter 1 figures have been restated to account for the effects on adoption of merger accounting.2 Proposed final single tier dividend of 5 sen per share for the financial year ended 31 December 2009 subject to the shareholders’ approval at the forthcoming

Annual General Meeting.

shAre PrIce PerFormAnce


Jan 09 Feb 09 Mar 09 Apr 09 May 09 Jun 09 Jul 09 Aug 09 Sep 09 Oct 09 nov 09 Dec 09

Trading Volume Highest Share Price

Share Price (RM)

monthLy trAdIng voLume And hIghest-LoWest shAre PrIce movements

Period: 1 January 2009 to 31 December 2009

Month Jan 09 Feb 09 Mar 09 Apr 09 May 09 Jun 09 Jul 09 Aug 09 Sep 09 Oct 09 Nov 09 Dec 09

Volume (’00) 479 380 2,776 12 332 93 1,012 20 14 260 2,183 383

Highest (RM) 4.86 4.54 4.20 4.02 4.48 4.48 4.50 4.20 4.20 4.20 3.60 3.26

Lowest (RM) 4.18 3.72 4.02 3.86 3.70 4.20 3.70 3.10 2.96 3.06 2.67 2.61

Volume (’00)

2

4

6

8

10

12

500

1,000

1,500

2,000

2,500

3,000

38

4.86

4.54

4.02

4.48 4.48 4.504.20 4.20 4.20

3.26

4.20

3.60

corPorAte mILestones


1986December

Indah Tegas Sdn Bhd (“ITSB”) was incorporated in Malaysia

under the Companies Act, 1965 as a wholly-owned subsidiary

of Kamunting Corporation Berhad (“KCB”) (now known as E&O

Property Development Berhad).

1990April

ITSB changed its name to Kamunting Construction Sdn Bhd

(“KCSB”) and commenced construction activities.

1990 - 1996

Handling mainly in-house projects within the Multi-Purpose -

Kamunting Group of Companies.

1997April

Malaysian Plantations Berhad (“MPB”) (now known as Alliance

Financial Group Berhad) acquired KCSB from KCB to serve as

a joint venture (“JV”) vehicle between K.L. Land Development

Sdn Bhd (“K.L. Land”), Putrajaya Holdings Sdn Bhd (“PJH”) and

Kumpulan Pinang Golf & Country Resort Sdn Bhd (“KPGCR”) to

jointly develop Putrajaya.

September

KCSB acquired Taman Melaka Raya Developments Sdn Bhd

(“TMR”) from Bandar Raya Developments Berhad. TMR was

principally engaged in the property development of Taman

Melaka Raya, Melaka.

1998July

Putrajaya Perdana Sdn Bhd (“PPSB”) was incorporated as a

new JV vehicle in place of KCSB.

September

KCSB and TMR changed their names to Putra Perdana

Construction Sdn Bhd (“PPC”) and Putra Perdana Development

Sdn Bhd (“PPD”) respectively.

OctOber

PPSB acquired 100% equity interest in both PPC and PPD.

2000July

KCB acquired 62% equity interest in K.L. Land which holds 55%

equity interest in PPSB from MPB.

AuguSt

KCB further acquired 15% equity interest in PPSB from KPGCR

by way of a Mandatory General Offer pursuant to the provisions

of the Malaysian Code on Take-Overs and Mergers, 1998. As a

result of these acquisitions, KCB holds 49.1% effective equity

interest in PPSB.

September

Both PPC and PPD were awarded the MS ISO 9001:1994

Quality Systems certification from SIRIM QAS International Sdn

Bhd/UKAS of United Kingdom.


corporate milestones

40

2000December

PPD acquired the entire equity interest of Sarjana Sejati (M) Sdn

Bhd (“SSSB”) from KCB. SSSB entered into a JV with Tunas

Eksklusif Holding Sdn Bhd in January 2001 to jointly develop a

piece of land in Bukit Katil, Melaka.

2002June

PPSB converted to a public limited company, known as Putrajaya

Perdana Berhad (“PPB”).

July

PPB moved to its own building at Danau Point, located in

Precinct 16, Putrajaya.

2004June

PPD acquired the entire equity interest of Senandung Budiman

Sdn Bhd (“SBSB”) from PJH. SBSB is principally engaged in

property development and construction.

2006July

The LEO (Low Energy Office) Building built by PPC was awarded

with the ASEAN Energy Efficiency & Conservation Best Practices

for Energy Efficient Building Award under the New & Existing

Category by the ASEAN Centre for Energy.

September

PPC obtained the Occupational Health and Safety Management

Systems Certificate from SIRIM QAS International Sdn Bhd

for the successful implementation of an Occupational Health

and Safety Management Systems complying with OHSAS

18001:1999. The scope of the certification covers construction

services in building and civil engineering works.

SBSB launched its first green residential product of exclusive

lake-front energy efficient bungalows, D’Heron At The Lakes, in

Precinct 16, Putrajaya to the public.

OctOber

PPB implemented the Putrajaya Perdana Employees’ Share

Option Scheme (“ESOS”) which entails the issuance of up to

15% of PPB’s issued and fully paid-up share capital at any one

time pursuant to the options to be granted under the ESOS,

to eligible Directors and employees of the Group. The ESOS is

governed by the ESOS By-Laws approved by the shareholders

at an Extraordinary General Meeting on 22 August 2006.

Listing of PPB’s entire issued and paid up share capital on the

Main Board (now known as Main Market) of Bursa Securities

under the construction counter.


corporate milestones

41

2007AuguSt

Swan Symphony Sdn Bhd (“Swan Symphony”), a special purpose

vehicle owned by the Abu Dhabi-Kuwait-Malaysia Investment

Corp and Autron Investment, a subsidiary of Singapore and

Australian-listed Autron Corp Ltd, emerged as a new substantial

shareholder of PPB after acquiring 50.6% of PPB shares from

Eastern & Oriental Bhd.

2008 OctOber

UBG Berhad (“UBG”) acquired the entire equity interest held

by Swan Symphony in PPB. As a result of the completion of a

conditional take-over offer and placement of shares by UBG,

UBG now holds 85.85% direct interest in PPB.

2009FebruAry

PPC was awarded the MS ISO 14001:2004 Environmental

Management System Certification from SIRIM QAS International

Sdn Bhd.

mAy

PPB completed its acquisition of the entire equity interests in

CMS Roads Sdn Bhd (“CMSR”) and CMS Pavement Tech Sdn

Bhd (“CMSPT”) from UBG. CMSR principally undertakes the

road management and maintenance work while CMSPT is a

specialist provider of pavement works encompassing pavement

construction, rehabilitation and maintenance.

2010mArch

PPB was named a finalist of StarBiz-ICR Malaysia Corporate

Responsibility Awards 2009. PPB was one of the 20 finalists

shortlisted from more than 300 public listed companies in

Malaysia who participated in this event. The award is a partnership

between The Star and Institute of Corporate Responsibility

Malaysia, and is supported by the Securities Commission

Malaysia and Bursa Malaysia.


stAtement oncorPorAte governAnce

42

IntroductIon

The Board of Directors (“Board”) of Putrajaya Perdana Berhad (“PPB” or the “Company”) is pleased to report that the Board remains firmly committed towards ensuring the highest standard of corporate governance is maintained throughout the Company and its subsidiaries (“Group”).

The Board subscribes to the belief that observance with statutory requirements and market regulations are pivotal to sound corporate governance. Hence, the Board is fully dedicated to continuously evaluate the Group’s corporate governance practices and procedures with a view to ensure the principles and best practices in corporate governance as promulgated by the Malaysian Code on Corporate Governance (Revised 2007) (“Code”) is applied and adhered to in the best interests of the stakeholders.

This disclosure statement sets out the manner in which the Group has applied and complied with the principles of the Code and the extent of compliance with best practices advocated therein pursuant to Bursa Malaysia Securities Berhad (“Bursa Securities”) Main Market Listing Requirements (“LR”).

BoArd oF dIrectors

1. The Board

PPB Board is made up of directors who are entrepreneurs and experienced professionals with a wide and varied range of expertise and skills. Together the members of the Board formed an effective Board that is able to effectively lead and control the Company.

The Board has the overall responsibility for effective performance and control of the Company and the Group, whereby collective decision and close monitoring are conducted on issues relating to strategic direction, formulation of policies, significant resource utilisation and investments of the Group. The Board also recognises its role in implementing an appropriate system of risk management and ensuring the adequacy and integrity of the Company’s system of internal control.

2. Board Balance

The Board currently has five (5) members, comprising one (1) Executive Director, designated as Chief Executive Officer and four (4) Non-Executive Directors. Two (2) of the four (4) Non-Executive Directors are Independent Directors. The presence of Independent Non-Executive Directors on the Board provides objectivity and they are of the calibre necessary to advise the Board on its decisions. The current composition of the Board is in compliance with the Code and the LR. The profile of each Board member is entailed on pages 16 to 17 of this Annual Report.

The Non-Executive Directors are involved in the formulation of policy and decision-making through their knowledge and experience on other business sector. They also play an important role in ensuring the strategies proposed by executive management are fully deliberated and examined, and consider the long term interest of all shareholders, employees, customers, suppliers and other stakeholders. The Independent Directors provide a broader view and independent assessment to the Board’s decision making process by acting as an effective check and balance.


statement on corporate governance

43

The roles of the Chairman and Chief Executive Officer are distinct and separate with their responsibilities clearly defined to ensure a balance of power and authority. The responsibilities of the Chief Executive Officer include constructing and implementing operational decisions while the responsibilities of the Chairman is primarily responsible for the orderly conduct and working of the Board. Given the strong independent element in the current board composition, the Board does not consider it necessary at this juncture to identify a Senior Independent Non-Executive Director. Any concerns relating to the Group may be conveyed by the stakeholders to any of the independent directors.

The Board is satisfied with its current membership as it fairly reflects the investment of minority shareholders in the Company and represents the required mix of skills and experience required to discharge the Board’s duties and responsibilities. In addition, no individual director or group of directors dominates the Board’s decision making.

3. Board Meetings

The Board is scheduled to meet at least four (4) times a year at quarterly intervals, with additional meetings to be convened when urgent and important decisions need to be made between the scheduled meetings. Agenda and Board papers are circulated to the Board prior to the Board meetings so as to give the Directors time to consider and deliberate on the issues to be raised at Board meetings.

During the financial year, the Board met five (5) times and details of the respective Director’s attendance is as follows:

no. of Meetings AttendanceDirector Designation Attended %

Krishnan a/l C K Menon Independent Non-Executive Director 5/5 100 Chairman

Dato Sri Mahmud Abu Bekir Taib Non-Independent Non-Executive Director 4/5 80 Deputy Chairman

Wie Hock Kiong Non-Independent Executive Director 5/5 100 Chief Executive Officer

Tan Vern Tact Non-Independent Non-Executive Director 5/5 100

Philip a/l K.O. Kunjappy Independent Non-Executive Director 5/5 100

Dato’ Ong Gim Huat Independent Non-Executive Director 4/5 80(Resigned on 28.12.2009)



4. Board Conduct

4.1 Supply of Information

The agenda and Board papers are circulated to all Board members well in advance to enable the Directors to obtain information and further explanations so that proper discussion can be held during Board meetings and an informed decision can be made. The Board papers include amongst others, minutes of previous meetings, group financial performance and proposal papers from the Management.

All Directors, whether as a full Board or in their individual capacity, have access to the advice and services of the Company Secretary. The Directors may also seek independent professional advice in furtherance of their duties, whenever they deem necessary, at the expense of the Company.

4.2 Relationship with Management

Senior Management staffs are invited to the Board and various Board committee meetings when necessary so as to provide additional information and insight into matters being discussed.

4.3 Conflict of Interest

The Directors have a continuing responsibility to determine whether they have a potential or actual conflict of interest in relation to any matter being discussed. The Directors must declare their interest if there is any potential related party transaction and abstain from voting, deliberation and giving any opinion when considering such transaction.

5. Directors’ Training

The Board acknowledges the importance of constantly updating itself on the industry’s changes and development. They are provided with the opportunity for training and updates from time to time, particularly on relevant new laws and regulations, financial reporting, risk management and investor relations to equip themselves with the knowledge to effectively discharge their duties as Directors.

The Board will ensure that all its members continue to keep abreast with the relevant developments in industry changes, laws, regulations and business management. The Board acknowledges that continuous education is essential for the Directors to further enhance their skills and knowledge. As an integral part of their training program, they are provided with updates from time to time on the relevant changes in laws, regulations and the business environment.

All Directors of the Company have attended and completed the Mandatory Accreditation Programme (“MAP”) as prescribed by the LR. The Nomination Committee has reviewed and is satisfied that the Directors have received the necessary training during the year under review which enhanced their effectiveness and contribution to the Board.



During the financial year, the Directors have attended the following training programmes:

Director Training Programmes

Krishnan a/l C K Menon 3rd Petronas Board Audit Committee Forum 2009

How to Ace the Media Interview

Representations & Warranties and Common Issues in Deal Structuring for Cross Border Merger and Acquisitions

Bursa Malaysia Evening Talks on Corporate Governance - Corporate Integrity

Bursa Malaysia Evening Talks on Corporate Governance - Risk Action Planning: The Missing Element in an Enterprise Risk Management Framework

The Challenges of Implementing FRS 139

Corporate Governance Guide: Towards Boardroom Excellence - Getting up to speed with Governance

SC - Bursa Malaysia Lecture Series Corporate Governance: Lessons from Hong Kong

Dato Sri Mahmud How to Ace the Media Interview Abu Bekir Taib Representations & Warranties and Common Issues in Deal Structuring for Cross Border

Merger and Acquisitions

Wie Hock Kiong Representations & Warranties and Common Issues in Deal Structuring for Cross Border Merger and Acquisitions

Corporate Governance Guide: Towards Boardroom Excellence

Tan Vern Tact How to Ace the Media Interview

Representations & Warranties and Common Issues in Deal Structuring for Cross Border Merger and Acquisitions


Financial Instruments: Recognition, Measurement, Presentation and Disclosure




46

Director Training Programmes

Philip a/l K.O. Kunjappy Representations & Warranties and Common Issues in Deal Structuring for Cross Border Merger and Acquisitions

Corporate Governance Guide - Towards Boardroom Excellence


Dato’ Ong Gim Huat Corporate Governance Guide - Towards Boardroom Excellence

Monica Oh Chin Chin Financial Instruments: Recognition, Measurement, Presentation and Disclosure (Alternate Director to Tan Vern Tact)

Mandatory Accreditation Programme for Directors of Public Listed Companies


Financial Instruments: Recognition, Measurement, Presentation and Disclosure

The Malaysian 2010 Budget & Tax Planning Conference

6. Appointment to the Board

The Nomination Committee, which comprises independent directors, is responsible for making recommendations for any new appointments to the Board. In making these recommendations, the Nomination Committee considers the required mix of skills and experience which the Directors should bring to the Board. Any new nomination received is put to the Board for assessment and endorsement. The proposed re-election of existing Directors who are seeking re-election at the Annual General Meeting are also considered and evaluated by the Nomination Committee. The Nomination Committee, upon its evaluation, will make recommendations on the proposals to the Board. The Board makes the final decision on the proposed re-election to be presented to shareholders for approval.

7. Re-election of Director

Board members who are appointed by the Board are subject to retirement at the first Annual General Meeting (“AGM”) of the Company subsequent to their appointment. The Company’s Articles of Association provides that at least one-third (1/3) of the Directors shall retire by rotation at each AGM and all Directors shall retire from office at least once every three (3) years, but shall be eligible for re-election.



47

8. Board Committees

The Board has established the following committees to assist the Board in discharging their duties and responsibilities. The committees are provided with written terms of reference. The Chairman of the various committees, comprises of Independent Non-Executive Directors, reports the decision and outcome of the committee meetings to the Board:

Directors Audit nomination Remuneration Executive Employees’ Committee Committee Committee Committee Share Option Scheme Committee

Independent non-Executive DirectorKrishnan a/l C K Menon Member Chairman Chairman Member ChairmanPhilip a/l K.O. Kunjappy Chairman Member Member Chairman MemberDato’ Ong Gim Huat 1 - - - - -

non-IndependentExecutive Director (CEO)Wie Hock Kiong - - - Member -

non-Independent non-Executive Director Dato Sri Mahmud Abu Bekir Taib - - - - -Tan Vern Tact Member Member Member Member Member

Note: 1 Resigned as an Independent Non-Executive Director on 28 December 2009.

8.1 Executive Committee

The objective of the Executive Committee (“EXCO”) is to assist the Board in discharging its responsibilities in respect of various matters or aspects that the Board mandates through more frequent meetings of a smaller number of appointed members of the Board who have the power to provide direction to the Management of the Company and to ensure the smooth and effective running of the Group.

The responsibilities of the EXCO shall be:- (a) to review, revise and approve the operation manual of the Group; (b) to review, revise and approve the human resources policy of the Group; (c) to review, revise and approve the terms and conditions relating to the engagement of consultants, contractors, legal or

professional advisers; (d) to implement all policies/decisions made by the Board, formulating the framework of key policies and procedures,

operational processes, management controls and structure; (e) to assist the Board in implementing the strategic plans and policies of the Group, identifying business and investment

risks, monitoring performance, results and budgets, major capital expenditure, major investment or divestment or corporate exercises affecting the Group;

(f) to decide on all development, construction, operations and financing matters referred by the management and any other responsibilities, functions or assignments as may be delegated from time to time by the Board; and

(g) to review the performance of the Group’s operating units, risk management issues and internal control process improvement and set the key performance indicators for the Board’s approval, if required.



48

8.2 Audit Committee

The Audit Committee’s responsibilities is to review the Company’s financial statements, system of internal controls, related party transactions and business risk management. The Audit Committee met five (5) times during the year. The Audit Committee met with the External Auditors twice during the financial year under review, without the presence of the executive board members and senior management of the Company.

A full Audit Committee report enumerating its membership, terms of reference and activities during the financial year is set out on pages 51 to 56 of this Annual Report.

8.3 nomination Committee

The Group adopts a formal and transparent procedure for the appointment of Directors to the Board through the Nomination Committee (“NC”). The NC comprises exclusively of Non-Executive Directors and majority of whom are independent.

The Board through the NC reviews annually its required mix of skills and experience and other qualities, including core competencies which Non-Executive Directors should bring to the Board. The NC is also responsible for reviewing and making recommendation on appointment of new members and reviewing the resignation of members to the Board. In making their recommendation, the Committee members shall consider the required size of the Board, required mix of skills and experience and other qualities which the Director shall bring to the Group. Nomination made is put forward to the Board for assessment and endorsement.

The NC met once during the year to review the effectiveness of the Board and the contribution of each Director, including the Independent Non-Executive Directors. The Committee also reviewed the structure, size and composition of the Board, and recommended the retiring directors for re-election at the PPB’s forthcoming Annual General Meeting.

During the year under review, the Board considered that the current mix of skills and experience of its members is sufficient for the effective discharge of its duties and responsibilities.

8.4 Remuneration Committee

The Remuneration Committee recommends to the Board the remuneration packages of the Executive Directors. Such packages are designed to attract, retain and motivate the Directors, and are reflective of their experience and level of responsibilities. The remuneration of the Executive Directors are reviewed annually.

The Board as a whole determines the remuneration of the Non-Executive Directors. None of the individual Directors participate in determining their individual remuneration.

The Remuneration Committee met once during the year under review and the meeting was attended by all members.

8.5 Employees’ Share Option Scheme Committee

The Employees’ Share Option Scheme (“ESOS”) Committee has been appointed by the Board to administer the PPB ESOS in accordance with the objectives and regulations stated therein the ESOS By-Laws.



49

dIrectors’ remunerAtIon

1. The Level and Make-up of Remuneration

The Company has adopted the objective as recommended by the Code to determine the remuneration of Directors so as to ensure the Company attracts and retains the Directors needed to run the Group effectively. The remuneration policy for Directors is designed to support the Company’s overall objective of delivering long-term value to its shareholders.

2. Directors’ Remuneration

Details of Directors’ Remuneration for the financial year ended 31 December 2009, distinguishing between Executive and Non-Executive Directors are categorised according to the following appropriate components:

Categories of Remunerations Executive Director non-Executive Directors (rm’000) (rm’000)

Salary and other emolument 1,130 -

Fees - 293

Total 1,130 293

The number of Directors whose remuneration falls into each successive band are set out below:

Remuneration Band number of Directors

Executive non-Executive

Less than RM50,000 - 2

RM50,001 to RM100,000 - 3

RM1,100,001 to RM1,150,000 1 -

Total 1 5

The Board is of the view that the transparency and accountability aspects of corporate governance as applicable to Directors’ remuneration are appropriately served by the “band disclosure” in accordance with the LR. Hence the remuneration of individual Directors in accordance with the Best Practice of the Code are not disclosed in this statement.

shArehoLders

1. Dialogue between the Company and Investors

A key element of good corporate governance is being transparent and accountable to all stakeholders. Underlying these transparency and accountability objectives is the communication of clear, relevant and comprehensive information which is timely and which is readily accessible by all stakeholders. As part of fulfilling its corporate governance obligations, the Board maintains a high level of disclosure and extensive communication with its stakeholders with the provision of clear, comprehensive and timely information. In addition to various announcements made during the year, the timely release of financial results on a quarterly basis, press releases, annual report and circulars provides shareholders with an overview of PPB Group’s performance and operations.



50

Besides, the Company actively responds to request for meetings with institutional shareholders, analysts and members of the press to provide them with a better understanding of the Group’s performance and direction. All queries from shareholders, members of public and news media received via telephone calls or written letters are handled by the CEO.

Announcement, disclosures made, press release, company’s projects, corporate and financial information of the Group are also made available to shareholders, investors and the public through the Group’s website at www.p-perdana.com.

2. Annual General Meeting (“AGM”)

The AGM is the principal forum for dialogue with individual shareholders and investors. Shareholders have direct access to the Directors and are provided with sufficient opportunity and time to participate through questions on the prospects, performance of the Group and other matters of concern. Members of the Board as well as the external auditors will be present to answer questions raised at the meeting. Suggestions and comments raised by shareholders will also be noted for consideration. Shareholders who are unable to attend are allowed to appoint proxies to attend and vote on their behalf.

AccountABILIty And AudIt

1. Financial Reporting

The Board aims to provide and present a balanced and meaningful assessment of the Group’s financial performance and prospects at the end of the financial year, primarily through the annual financial statement, quarterly announcement of results to shareholders as well as the Chairman’s statement and review of operations in this Annual Report.

The Board is assisted by the Audit Committee in overseeing the Group’s financial reporting processes and the accuracy, adequacy and completeness of its financial reporting.

The Directors’ Responsibility Statement for the Audited Financial Statements of the Company and the Group is set out on page 61 of this Annual Report.

2. Internal Control

The Board affirms its overall responsibility for the Group’s system of internal control to safeguard shareholders’ interest and review the adequacy and integrity of the Group’s system of internal control regularly.

Information on the Group’s Internal Control is presented in the Statement on Internal Control as detailed on pages 57 to 58 of this Annual Report.

3. Relationship with Auditors

The Company maintained a transparent and appropriate relationship with both the external and internal auditors through the Audit Committee. The role of the Audit Committee in relation to both external and internal auditors is stated on pages 51 to 58 of this Annual Report.

This Statement was made based on the collective approval of the Board on 22 February 2010.


AudIt commIttee rePort

The Audit Committee assists the Board in fulfilling its responsibilities in relation to the Group’s risk management and internal control system, internal and external audit functions, accounting policies and practices and financial reporting.

memBers oF the AudIt commIttee

The Audit Committee comprises of three (3) members, all of whom are Non-Executive Directors and majority of whom are Independent Directors.

The members of the Audit Committee are:-

Philip a/l K.O. Kunjappy Chairman Independent Non-Executive Director

Krishnan a/l C K Menon Member Independent Non-Executive Director

Tan Vern Tact Member Non-Independent Non-Executive Director

All members of the Audit Committee are Non-Executive Directors, the Chairman is an Independent Non-Executive Director and a member of Malaysia Institute of Accountant. The Company is therefore in compliance with Bursa Malaysia Securities Berhad Main Market Listing Requirements.

meetIng And AttendAnce

During the financial year under review, the Audit Committee convened five (5) meetings. Details of the attendance of Audit Committee meetings for the year are as follows:-

name of Director no. of Meetings Attended %

Philip a/l K.O. Kunjappy 5/5 100

Krishnan a/l C K Menon 5/5 100

Tan Vern Tact 5/5 100

The Audit Committee has met with the External Auditors without presence of the executive board members’ twice in the financial year under review.

The representative of the internal audit attended meetings held during the financial year. Other senior management members and the representative of the External Auditors also attended these meetings upon invitation to brief on the specific issues.


audit committee report

terms oF reFerence

The terms of reference of the Audit Committee are set out below:

1.0 Composition

1.1 The Audit Committee shall be appointed by the Board of Directors from amongst their number and shall consist of not less than three (3) members, all of whom must be non-executive directors, with a majority of them being independent directors.

1.2 The Board shall at all times ensure that at least one (1) member of the Audit Committee:

• mustbeamemberoftheMalaysianInstituteofAccountants(“MIA”);or • ifheisnotamemberoftheMIA,hemusthaveatleastthree(3)years’workingexperienceand: (a) he must have passed the examinations specified in Part I of the 1st Schedule of the Accountants Act, 1967; or (b) he must be a member of one of the associations of accountants specified in Part II of the 1st Schedule of the Accountants

Act 1967; or • fulfilssuchotherrequirementsasprescribedorapprovedbyBursaMalaysiaSecuritiesBerhad.

1.3 In the event of any vacancy in the Audit Committee resulting in the numbers of member being reduced to below three (3), the Board of Directors shall within 3 months appoint such number of new members as may be required to make up the minimum number of three (3) members.

1.4 No alternate director shall be appointed as a member of the Audit Committee.

1.5 The members of the Audit Committee shall elect a Chairman from amongst their number who shall be an independent director.

1.6 The term of office and performance of the Audit Committee and each of its members shall be reviewed by the Board at least once every three (3) years.

2.0 Quorum and Procedures of Meetings

2.1 The Audit Committee shall meet as the Chairman deems necessary but not less than four times a year.

2.2 The Audit Committee may, as and when deemed necessary, invite other Board members, senior management personnel and external independent professional advisers to attend the meetings.

2.3 In order to form a quorum in respect of a meeting of the Audit Committee, the majority of members of the Audit Committee present at the meeting must be independent directors.

2.4 The Secretary is responsible for sending out notices of meetings, preparing and keeping minutes of meetings and circulating the minutes of meetings to the Audit Committee and all members of the Board.

2.5 The Audit Committee shall meet with the external auditors, without the executive board members’ present, at least twice in a financial year.



53

3.0 Authority

3.1 The Audit Committee shall have the authority to:

(a) investigate any matter within its terms of reference;

(b) have the resources which are required to perform its duties;

(c) have full and unrestricted access to any information pertaining to the Company;

(d) have direct communication channels with the external auditors or person(s) carrying out the internal audit function or activity (if any);

(e) obtain independent professional or other advice; and

(f) convene meetings with the external auditors, the internal auditors or both, excluding the attendance of other directors and employees of the Company, whenever deemed necessary.

3.2 Where the Audit Committee is of the view that a matter reported by it to the Board has not been satisfactorily resolved resulting in a breach of the Listing Requirements, the Audit Committee shall promptly report such matter to Bursa Malaysia Securities Berhad.

4.0 Duties and Responsibilities

The Audit Committee shall review and report to the Board of Directors the following, where appropriate:

(a) Risk Management and Internal Control

• Theadequacyandintegrityofriskmanagement,internalcontrolandgovernancesystemsinstitutedintheCompanyandthe Group

• Overallriskmanagementprocesses,riskmanagementpoliciesandimplementationofsystemstomanagerisks • Theappointmentorterminationoftheheadofriskmanagementunit • Thereportoftheriskmanagementunit

(b) Internal Audit

• TheoutsourcedinternalauditfunctionwillreportdirectlytotheAuditCommittee • Theadequacyofthescope,functions,competencyandresourcesoftheoutsourcedinternalauditfunction,andthatit

has the necessary authority to carry out its work • Appraiseorassesstheperformanceoftheoutsourcedinternalauditfunction • Approveanyappointmentorterminationoftheoutsourcedinternalauditfunction • Takecognisanceofthedeterminationofanyoutsourcedinternalauditfunctionandprovideitwithanopportunityto

submit its reasons for determining its function


(c) External Audit

• Reviewoftheauditplanandscopeoftheiraudits,includinganychangestothescopeoftheauditplanwiththeexternalauditor

• Theexternalauditors’auditreportandtheirevaluationofthesystemofinternalcontrols • TheassistancegivenbytheemployeesoftheCompanytotheexternalauditors • The appointment and performance of external auditors, the audit fee and any question of resignation or dismissal

including any written explanations before making recommendations to the Board

(d) Audit Reports

• The internal audit programme, processes, the results of the internal audit programme, processes or investigationundertaken and whether or not appropriate action is taken on the recommendations of the internal audit function

• Themajorfindingsofinternalinvestigationsandrelatedmanagementresponses

(e) Financial Reporting

The quarterly results and the year end financial statements of the Company and the Group for recommendation to the Board of Directors for approval, focusing particularly on:

• Changesinorimplementationofaccountingpoliciesandpractices; • Significantandunusualevents; • Compliancewithaccountingstandardsandotherlegalrequirements;and • Goingconcernassumption

(f) Related Party Transactions

Any related party transaction and conflict of interest situation that may arise within the Company or the Group including any transaction, procedure or course of conduct that raises questions of management integrity

(g) Allocation of Share Options

Verification on the allocation of share options to ensure compliance with the criteria for allocation of share options pursuant to the share scheme for employees of the Group at the end of each financial year, if any.

(h) Other Functions

Any such other functions as the Audit Committee considers appropriate or as authorised by the Board of Directors.

ActIvItIes durIng the yeAr

Summary of Activities of the Audit Committee

During the year under review, the Audit Committee had reviewed and deliberated the following matters and made relevant recommendation to the Board for approval:

(a) the External Auditors’s audit planning memorandum for the financial year ended 31 December 2009 audit and considered their proposed audit fees;



(b) discussed with the External Auditors the overview of the audit process, updates of new developments on accounting standards issued by the Malaysian Accounting Standards Board, updates on the Capital Markets and Services Act 2007;

(c) quarterly and annual financial reporting;

(d) the outsourced Internal Auditors’ audit plan, scope of audit and approved the annual internal audit plan, risk management report;

(e) the outsourced Internal Auditors’ report, findings and areas for improvement by the management. Follow-up audits reports were also reviewed to ensure that appropriate actions are taken to improve the system of internal control and procedures;

(f) related party transactions of the Group and recurrent related party transactions entered during the financial year based on the monthly reports submitted by the management;

(g) the half-yearly reports of the enterprise risk management programme;

(h) the Internal Audit Charter; and

(i) the performance of the outsourced Internal Audit function.

stAtement on InternAL AudIt FunctIon

The Group outsourced its internal audit function to a professional service provider firm to assist the Audit Committee in discharging its duties and responsibilities by executing independent reviews on the Group’s systems of internal control on a systematic basis.

The director of the outsourced service provider has been identified as the Head of the Internal Audit Function. During the year, the outsourced service provider‘s director or its representatives have attended all the Audit Committee meetings.

Functions and Duties

The duties of the internal audit function is to:

(a) discuss with the Audit Committee on the scope, procedures, results and reports of internal audits;

(b) review the effectiveness of the Group’s internal control system;

(c) perform the following:

i) prepare the audit plan for the Audit Committee’s consideration;

ii) execute audits in accordance with the audit plan approved by the Audit Committee. Specifically, these include:

• preparetheinternalauditprogramme; • documenttheprocessesreviewed; • reporttheresultsofinternalaudits,processesorinvestigationundertaken;and • determine whether appropriate action is taken by the management on the recommendations of the internal audit

function



iii) report on their evaluation of the Group’s system of internal control;

iv) review any conflict of interest situation that may arise within the Company or the Group including any transaction, procedure or course of conduct that raises questions of management;

v) submit to the Audit Committee a report on the summary of activities of the internal audit function in the discharge of its duties and responsibilities in respect of each financial year; and

vi) perform other functions and duties as may be prescribed to by the Audit Committee and the Board.

Summary of Activities of the Internal Audit Function

During the period under review, various activities were carried out to provide the Audit Committee with reasonable assurance that PPB Group’s systems of internal control continue to operate satisfactorily and effectively. Amongst the activities that were carried out include:

• formulatedannualauditplanthatfocusesoncontrolsmanagingtheprincipalrisksoftheGroup;• reviewedtheresourcerequirementsfortheauditexecutions;• executedinternalauditsinaccordancewiththeannualauditplanapprovedbytheAuditCommittee;• reportingtheresultsofinternalauditstotheCommitteeonaperiodicbasis;and• followed-upontheimplementationofauditrecommendationsandManagement’sagreeduponactionplans.

Resources

The outsourced internal audit function has stringent hiring, professional development and promotion policies as the firm seeks to attain and maintain professional competence and technical standards required to enable the delivery of quality services with due care. Hence, professionals assigned to perform internal audits at PPB Group are trained to demonstrate value and to work with management in co-developing and co-delivering solutions.

Cost of Maintaining Internal Audit Function

During the financial year under review, the outsourced service provider has conducted 4 reviews for the Group (inclusive of a special review conducted on CMS Roads Sdn Bhd) and the cost incurred to maintain the internal audit function amounted to RM305,878.50.



stAtement on InternAL controL

IntroductIon

The Malaysian Code on Corporate Governance requires the Board of Directors of public listed companies to identify significant risks and maintain a sound system of internal control to safeguard shareholders’ investments and the Group’s assets. The Listing Requirements of Bursa Malaysia Securities Berhad (“Bursa Securities”) for the Main Market requires directors of public listed companies to include a statement in the annual report on its status on internal control as a group. Pursuant to complying with the above requirements and guided by the Statement on Internal Control: Guidance for Directors of Public Listed Companies (“the Guidance”), the Board of Directors (“the Board”) of Putrajaya Perdana Berhad (“PPB”) is pleased to present below its Statement on Internal Control as a group for the financial year ended 31 December 2009.

BoArd resPonsIBILIty

The Board of PPB recognises the importance of sound internal control and risk management practices for good corporate governance and endeavors to maintain an appropriate group-wide system of internal control and risk management. The Board is ultimately responsible for PPB Group’s system of internal control which includes the establishment of appropriate control environment and framework as well as reviewing its adequacy and integrity. However, due to the inherent limitations in any system of internal control, such system of internal control put into effect by the Management can only manage but not eliminate all risks that may impede the achievement of the Group’s business objectives. Therefore, the internal control system can only provide reasonable and not absolute assurance against material misstatement or loss.

rIsK mAnAgement FrAmeWorK

The Board firmly believes that risk management is critical to the Group’s continued profitability and the enhancement of shareholders’ value. Therefore, the Board had embedded in the Group a monitoring and reporting process to continuously evaluate and monitor the principal risks in a formal manner as well as establishing procedures for reporting and monitoring of risks and controls. These initiatives would ensure that the Group has in place an ongoing process for identifying, evaluating, monitoring and managing the principal risks that affects the achievement of its business objectives.

Key risks relating to PPB’s operations and strategic and business plans are addressed at periodic management meetings. In addition, the responsibility of managing the risks of each department lies with the respective Heads of Department and it is during the periodic management meetings, significant risks identified and the corresponding internal controls implemented are communicated to the Chief Executive Officer (“CEO”) and Senior Management.

mAnAgement styLe & controL envIronment

Enhancing the Group’s ability to achieve its business objectives remains as the Board’s primary objective and direction in managing PPB Group. In ensuring that this objective is achieved, the Board will continue to rely on the Senior Management to ensure that the performances of their businesses are within the agreed business strategies. The Board will in turn monitor the performances and profitability through the reports it received and its involvement in operational and strategic meetings. Matters arising which are significant in nature are brought to the attention of the CEO, who in turn, will direct these matters, if necessary, to the Board for its attention.


statement on internal control

58

In monitoring the performance of the Group, an elaborate annual budgetary planning and review process is practised. This is to ensure that the performance of the various business units can be monitored and benchmarked, and the interests of all its stakeholders are addressed.

Well-defined organisational structures and management disciplines further reinforced the internal control framework to ensure its continued relevance and effectiveness. Among the management disciplines were the Group-wide authority chart which provided clear definition of delegated authority to various management levels.

The Group continues to maintain its proven ‘open-door’ and ‘hands-on’ approach to allow for the efficient resolution of matters arising and drawing on the experience and knowledge of employees throughout the Group.

InternAL controL mechAnIsm

The responsibility for reviewing the adequacy and integrity of the internal control system has been delegated by the Board to the Audit Committee. In turn, the Audit Committee assesses the adequacy and integrity of the internal control system through independent reviews conducted on reports it received from external auditors, the internal auditors and the Management. Significant internal control matters which are brought to the attention of the Audit Committee will be highlighted to the Board.

The Group has outsourced its internal audit function to a globally affiliated internal audit service provider firm as part of its strategy to provide the Board with assurance on the adequacy and integrity of the systems of internal control. The outsourced internal audit function focuses on the review of areas which are related to the significant risks of PPB Group. The areas of review are set out in a risk based internal audit plan which has been approved by the Audit Committee.

During the financial year, scheduled reviews on the Group’s systems of internal control were completed according to approved audit plan. Although a number of internal control weaknesses were identified during this process, none of the weaknesses have resulted in any material losses, contingencies or uncertainties that would require separate disclosure in this annual report.

summAry

In accordance with the assessment of the Group’s systems of internal control, the Board is of the view that the risks undertaken by the Group are within tolerable level in the context of the business environment the Group operates in and the systems of internal control that existed throughout the year comprising the internal control framework, management processes, monitoring and review processes that can be relied on. During the year under review, nothing has come to the attention of the Board which would result in any material losses, contingencies or uncertainties that would require separate disclosure in this annual report. Notwithstanding this, the Board will continue to ensure that the Group’s systems of internal control can continuously adapt to prevail in its current changing and challenging business environment.

This statement was made in accordance with the PPB’s Board of Directors resolution dated 22 February 2010.


AddItIonAL comPLIAnce InFormAtIon

The following information is presented in compliance with Appendix 9C, Paragraph 9.25 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad:

1. Utilisation of Proceeds

The Company did not make any corporate proposal during the financial year ended 31 December 2009.

2. Share Buy-Back

The Company did not make any proposal for share buy-back during the financial year ended 31 December 2009.

3. Options or Convertible Securities

During the financial year under review, the Company did not issue any options or convertible securities and there was no ESOS option exercised. The number of ESOS option not exercised as at 31 December 2009 was 120,000.

4. Depository Receipt Programme

The Company did not sponsor any depository receipt programme during the financial year under review.

5. Sanctions and/or Penalties

There were no sanctions and/or penalties imposed on the Company and its subsidiaries, directors or management during the financial year ended 31 December 2009.

6. non-Audit Fees

The non-audit fees incurred for the financial year ended 31 December 2009 are as follows:-

Ernst & Young RM 7,500 Ernst & Young Tax Consultants Sdn Bhd RM 92,400

7. Variation in Results

There was no variance between the unaudited results of the Group as announced on 22 February 2010 and the audited consolidated results for the financial year ended 31 December 2009.

8. Profit Guarantee

There was no profit guarantee issued by the Group during the financial year under review.


additional compliance information

60

9. Material Contracts Involving Directors’ and Major Shareholders’ Interests

Save as disclosed below, there were no other material contracts (not being contracts entered into in the ordinary course of business) entered into by the Company and its subsidiaries involving Directors and Major Shareholders’ interests since the previous financial year ended 31 December 2008:

(i) Share Sale Agreement dated 26 February 2009 between UBG Berhad (“UBG”) and the Company for the acquisition by the Company of 1,000,000 ordinary shares of RM1.00 each in CMS Roads Sdn Bhd and 5,000,000 ordinary shares of RM1.00 each in CMS Pavement Tech Sdn Bhd (“CMSPT”) from UBG at an aggregate cash consideration of RM75 million (“Acquisition”). The Acquisition was completed on 12 May 2009.

10. Revaluation Policy on Landed Properties

The Group does not have a revaluation policy on landed properties.

11. Recurrent Related Party Transaction of a Revenue or Trading nature (“RRPT”)

The Group had on 30 April 2009 obtained a shareholders’ mandate for the Group to enter into RRPT with the related parties. The breakdown of the aggregate value of RRPT transacted by the Group during the financial year under review were as follows:

Related Parties Types of transaction Transacted value for the financial year ended 31 December 2009 (rm’000)

Cahya Mata Sarawak Berhad (“CMS”)1 Provision of construction 41,440Group contracts and services

CMS1 Group Procurement of material contracts - Payments (32,698) - Claims 21,629

Note: 1 CMS is a major shareholder of the Company. CMS is deemed interested by virtue of its direct equity interest of 100% in Concordance Holdings Sdn Bhd,

which holds 28.3% direct equity interest in UBG and indirect equity interest of 51% in PPESW, which in aggregate holds more than 15% direct equity interest in UBG whereby UBG in turn holds 85.9% direct equity interest in PPB. YBhg Dato Sri Mahmud Abu Bekir Taib is a Non-Independent Director of CMS and the Company.


Under the Companies Act, 1965 (“Act”), the Directors are responsible for the maintenance of accounting records and the preparation of the annual financial statements of the Company and of the Group in accordance with applicable Financial Reporting Standards in Malaysia which give a true and fair view of the financial position of the Company and the Group as at the end of the financial year and of the results and cash flows of the Company and the Group for the financial year.

In preparing the financial statements, the Directors have:

• appliedappropriateandrelevantaccountingpoliciesonaconsistentbasis;

• madejudgementsandestimatesthatarereasonableandprudent;

• preparedthefinancialstatementsonagoingconcernbasis;and

• keptappropriateaccountingrecordstoensurethatthefinancialstatementscomplywiththeprovisionsoftheAct.

dIrectors’ resPonsIBILIty stAtement in accordance with 15.26(a) of Bursa Malaysia Securities Berhad Main Market Listing Requirements

Protectingwhat matters most

The dome skylight at the atrium is the

centrepiece of the Diamond Building.

It allows natural day light to penetrate

the core of the building.


corPorAte resPonsIBILIty

64

Putrajaya Perdana Berhad (“PPB” or “the Group”) recognises the importance of implementing and managing good Corporate Responsibility (“CR”) practices within the ambit of our overall business activities. We endeavour to inspire and empower our people to contribute positively to the marketplace, workplace, environment and community in which we operate while balancing this with astute financial performance. We have adopted the Japanese maxim kaizen which advocates that we apply the principle of continuous improvement to every level of our CR implementation through involving all members of our organisation to build a better tomorrow for all.

In doing so, we look to the following principles to guide us in our daily operations:

Reliable Marketplace Practices

• Weare committed to complyingwith legal and regulatoryrequirements in all our activities, and we strive for continuous improvement in all our business practices;

• Weactivelypromoteastronghealthyandsafeculturewithinour supply chain, ensuring a safe and conducive working environment at all our project sites and the places where our employees and other business associates work;

• We promote sustainable construction and design in ourwork to minimise any negative impact on the environment and society as a whole; and

• Weendeavour toengageactivelywithall stakeholdersbyanticipating and satisfying stakeholders’ needs, engaging in ethical procurement practices, and continuing to deliver and create value for our shareholders.

Sharing in the joy of providing for 31 orang aslifamilies at Kampung Sekukuh, Pekan, Pahang


corporate responsibility

65

Fair Workplace Practices

• We uphold equal opportunities in all areas of workopportunities;

• We are committed to improving the quality of life of ouremployees through good remuneration packages, staff benefits and personal development programmes;

• We strive to cultivate and maintain a conducive workingenvironment and healthy working culture at all times; and

• Wepractiseopen-doorcommunicationbetweenemployeesand management.

Safe Environmental Practices

• We seek to protect and preserve the environment bypromoting and maintaining best practices in our activities;

• We reduce waste through recycling whenever possible toenhance our waste management practices;

• Wepromoteenergyefficiencyandsustainabledevelopmentin all our products and services to reduce our global carbon footprint; and

• Wetakeintoconsiderationthevalueofallbiodiversitywithinour construction sites to minimise any impact on the fauna and flora within the area.

The safety management committee of a Korean delegation on a site visit to Wisma Felda sharing their construction safety know-how

The 20 years and above Long Service

Award was given out during the 2010

Annual Dinner to commemorate the employees’

continuous commitment towards

the Group

Impactful Community Practices

• We are committed to undertaking philanthropic effortsamong the communities we operate in by supporting them in terms of monetary means with the overall aim of elevating their lives; and

• Weare involved inupgrading thestandardof livingof thecommunity around our office and work sites via a properly structured community programme.

In support of the above principles, we have in place various policies such as PPB’s Corporate Governance Policy, Risk Management Policy, Quality Policy, Environmental Policy and Health and Safety Policy.



our commItment toWArds heALth & sAFety

The Group is committed to the health and safety of our employees and co-workers and all the Group’s companies prioritise these matters above all others in their project management meetings. The Group Health and Safety Committee is responsible for reviewing and analysing our entire safety operational structure for possible shortcomings. The committee goes to great lengths to ensure existing safety measures are continuously being improved upon and that stringent standards and practices are in place to ensure the well-being of all parties.

Proactive Site Safety Audit

In 2009, we carried out 32 Site Safety Audits at eight sites where systematic and meticulous information and knowledge sharing were emphasised. These sessions helped shed light on the many onsite problems project managers had encountered as well as offered practical, proactive solutions on how to overcome similar hazardous situations or practices. To date, many of the best practices picked up from these sessions are being enforced at all sites as proactive measures rather than as corrective measures.

Higher OHSAS 18001:2007 Standards

We have also successfully upgraded the OHSAS 18001:1999 certification to OHSAS 18001:2007, thereby fulfilling the new and more stringent occupational health and safety standards set by SIRIM Malaysia.

Following the rampant outbreak attack of A(H1N1) globally, we have set up screening points at all site entrances to ensure every worker and visitor is screened and deemed fit enough to enter our sites. On top of this, all our site staff canteens are equipped with filtered water canisters to ensure a good supply of clean water at all times.

Over 100 Site First-aiders Onsite

To date, we have more than 100 first-aiders spread across all our sites to handle minor injuries and apply first-aid as and when needed. All the Group’s first-aiders are required to attend refresher training courses every year to keep themselves updated on the latest techniques.

Successful Zero Fatality Record

As a result of our stringent health and safety standards and practices as well as the many proactive initiatives implemented over the course of the year, PPB recorded zero fatality in 2009.



67

Basic onsite dress code requirement: SIRIM-approved safety helmet with chin strap, ear plug, eye protection and dust mask

1

First-aid rooms complete with medical supplies and in-house first-aiders

2

3

Temporary safe passageway to worksites Safety signage

4

List of Major Safety Measures Implemented:

Introduction of new Safety Measures

In 2009, we implemented several new safety measures within our Building Construction Division. These included:

Areas Involved Previous Practices newly Introduced Practices

Exterior works External scaffold Mass climber, gondola and sky lift

Edge protection for high rise External scaffold for Climbing Protection Panel (“CPP”)building construction edge protection

Lift openings Canvas cover GI wire-mesh swing door

Hoisting of water drum using tower crane Without cage With caged water drum

Floor opening fall protection Using timber and plywood Caste in BRC netting for for cover better cover

Barricade at loading platform Permanent barricade which Easy to remove and replace is inconvenient edge barricade

Lifting of table form to upper floors Tower crane Peri table lifter

Daily attendance/head count Manually counted Palm scanning reader

Working at heights Use of safety belt Use of safety harness

Head protection Helmet Helmet with chin strap



68

Empty spaces and floor openings barricaded with GI Pipes and safety netting

5

Edge and fall protection complete with lifelines for workers to hook their safety harnesses

67

Monthly training on the proper use of fire extinguisher

8

Proper barricades and signage provided during hacking work9

Standard lifting cage for transporting drums for building materials



69

Demarcation for construction material storage complete with signage

10

M&E floor openings cast with BRC (DA5) and covered with plywood to prevent falls

11

12

Lift door protection CIDB Green Card Training

13

14

Permit-to-work system applied to all formwork dismantling works to ensure compliance with formwork dismantling procedures

Proper passenger hoist lobby (complete with overhead protection)

15



70

Caged entrance to passenger hoist is guarded by security guards. Workers are to board the passenger hoist in an orderly manner

16 17

Concreting using placing boom

Easy to remove temporary edge barricade for areas where the loading platform will be installed

18

Peri CPP (Climbing Protection Panel) for external fall protection (man and material) all round the structure

19

Use of mass climber to install cladding and glass

20

Proper planning on the allocation of temporary lighting and power points

21

22

Temporary toilets and urinals built at alternate floors to cater for workers’ needs


our commItment toWArds our emPLoyees

Catering to Employees’ Recreational needs

Following the formation of Kelab Sukan Putrajaya Perdana Berhad (“KSPPB”) in 2008 to cater to the recreational needs of the Group’s employees, the 2009/2010 term saw us rolling out the following activities for our employees ranging from community work and donations to sports, environmental and health care activities:

71

Celebrating the DeepaRaya festivities together


A(H1N1) prevention programme. Security Guard will scan all workers

body temperature every alternate day at site entrances

PPB at the Peak: 20 triumphant employees proudly bear the Putrajaya Perdana flag after having conquered Mt. Kinabalu on 30 October 2009

•KSPPBbowlingtournaments•Bloodandorgandonation•KSPPBbadmintontournament•Externalbadmintontournament•DeepavalicelebrationatPusatJagaanBeribuanKasih•StaffDeepaRayacelebration•MountKinabaluexpedition“PPBatthePeak”•Futsaltournament

•ChristmasandNewYearstaffcelebration-cum-lunch•Kidneyhealthtalkandscreening•PPBAnnualDinner:“RainbowofChange”•StaffoutingtoTaiping•ChineseNewYearcelebrationandlunchtreatforstaff•Futsaltraining•Monthlyrecyclingcampaign

Chinese New Year Celebration at

Putrajaya Office

The monthly recyclingcampaign gets off to

a good start



Through these activities, our employees were able to foster better ties and sense of belonging which has certainly helped forge a stronger working relationship and team spirit among them. Different activities were lined up for the Group’s new subsidiaries, CMS Roads Sdn Bhd (“CMSR”), CMS Pavement Tech Sdn Bhd (“CMSPT”) as well as Putra Perdana Construction Sdn Bhd’s (“PPC”) offshore branch offices over the same timeframe.

Increased Training and Development Budget

In response to the rapidly changing needs of our clients and intense requirement for better quality products, PPB has progressively increased its training budget over the years.

For 2009, more than RM500,000 was allocated for training purposes with some 60% of our workforce benefitting from a total of four training hours per staff. Most of these trainings covered skills and technical trainings conducted either in-house or via external parties.

Balanced Staff Benefits Structure

To standardise our work practices and ensure all employees receive equal treatment, the Group has revised the employee benefit structure whereby all employees now benefit equally from the scheme. Amongst the newly introduced benefits are the employee hospital and surgical card, and an increase in Employer’s EPF contributions to 15% (effective 1 January 2010).

Recognising Staff Contributions

To encourage innovation and leadership amongst employees, the Good Action Award is awarded annually. It aims to motivate employees to be proactive and take the lead in implementing innovative ways to improve our workflow and operational efficiency. In 2009, there was a significant increase in the number of awards handed out with 12 employees receiving the award at our Annual Dinner 2010 in comparison to 4 recipients in 2008.

Long-service Awards for employees with more than 20 years of services were also presented to 11 employees who have been loyally serving the Group. These awards serve to recognise our employees’ worthy contributions from our inception till today where the Group is recognised as an industry icon.

Rewarding Academic Excellence

The Group also continues to reward the children of our employees who have excelled in the UPSR, PMR and SPM examinations on an annual basis. In early 2010, the management decided to reward the children of our employees who had taken or will be taking STPM or A-Level examinations to encourage them to pursue higher education. This is in line with our vision of making Malaysia a developed country with well-educated citizens.

Representatives receiving the annual Good ActionAward during the 2010 Annual Dinner


Donars at the KSPPB-organised annual blood and organ

donation campaign

PPC received the ISO 14001 certification recognition at the Majlis SIRIM-Industri 2009

held on 20 November 2009 at KLCC

our commItment toWArds our envIronment

Driving the Green Building Movement

In line with our mission of greening the environment and driving home the importance of sustainability, PPB continues to spearhead the construction of green buildings in Malaysia. Following the construction of two of Malaysia’s landmark green and energy efficient buildings, namely the Low Energy Office (“LEO”) Building and the Green Energy Office (“GEO”) Building, we went on to complete the Diamond Building for the Energy Commission in Putrajaya in March 2010. This innovative building is targeting to receive the Green Mark Platinum certification by Singapore’s Building and Construction Authority (“BCA”) in recognition of its successfully passing the most rigorous tier of the four-tier green building benchmark developed by the BCA. Meanwhile our on-going projects, the Sarawak Energy Berhad Headquarters and the 2C2 commercial building in Putrajaya, are possibly upgraded to Green Building status in line with the Malaysian Green Building Index (“GBI”).

On 9 September 2009, three of our landmark projects, the LEO, GEO and Diamond buildings appeared on POS Malaysia’s 2009 stamps and first-day covers under the theme “Energy Efficient Buildings”. This is apt reflection that our efforts in pioneering energy efficiency and green building development have gained recognition at the national level.


Reducing Our Global Carbon Footprint

In support of the Earth Hour 2009 campaign mooted by the World Wildlife Fund which aims to reduce to global carbon footprint by switching off lights for an hour, some 130 of the Group’s employees including those within four project sites and PPC worker camps, pledged to “total lights out” on 28 March 2009. This move attests to our commitment and seriousness in doing our part for Mother Earth be it individually at home, or collectively at our workplace. For 2010, we had 285 employees who came forward to pledge their commitment to putting their lights out in support of this novel movement.

ISO 14001 certification

PPC was accredited with ISO 14001: 2004 Certification by SIRIM on 6 February 2009.

Focusing on Waste Management

In the year under review, we focused our efforts on waste management activities. Waste management training and waste disposal management activities were conducted to create a better understanding of the handling methodology for scheduled and non-scheduled waste. To show that we are committed to walking our talk, we launched a battery and light bulbs recycling campaign at the end of 2009. This campaign aims to encourage employees to dispose of used batteries and light



74

buildings. To showcase real-life green building applications, we incorporated tours of the LEO Building and GEO Building into our lecture tour agenda.

Following positive feedback from the universities and colleges we visited, we hope to inspire other organisations in the corporate world to conduct similar sustainable development awareness campaigns and elevate green building standards in Malaysia.

Championing Green Building Standards

As one of the pioneers of Malaysia’s green building movement, we became one of the first few corporate members of the newly established Malaysia Green Building Confederation (“MGBC”) in the year under review. The year also saw us sending a team of six employees to attend the GBI facilitator course to gain a better understanding of the stringent requirements of the GBI launched in May 2009.

To drive home the importance of green building construction within the Group, we have lined up a series of talks to educate all our onsite employees and workers about GBI and green construction-related matters beginning 2010. Moving forward,

Coming to grips with the conceptsof scheduled and non-scheduled waste

at a Waste Management Training session for employees

Enthusiastic participants of the Green LectureTour at Universiti Kebangsaan Malaysia, Bangi

bulbs as scheduled waste rather than to throw these items away as common rubbish that would end up in a landfill. Numerous posters and emails on the correct method for disposing this scheduled waste were disseminated to all employees.

Our monthly recycling campaign has been gathering good momentum even as employees and residents living in the vicinity of Danau Point near the Group’s headquarters have begun to participate actively in this campaign by segregating and disposing waste in the correct manner in recycle bins placed outside our premises. The monthly collection from the sale of recyclable items is currently being channelled to KSPPB.

Green Education via the Green Lecture Tour

To create awareness about the need for sustainable development in engineering and construction, we mooted and launched the Green Lecture Tour in late 2008. In 2009, we went on to conduct a total of six events among local and foreign students at both public and private universities. Where our first lecture tour series focused on the issue of global warming and emphasised the need for green development, our second tour focused on practical applications relating to the construction of green and sustainable



Providing Complimentary Infrastructure Development

Following the Group’s expansion into East Malaysia in the second quarter of 2009, our scope of work in relation to the communities we operate in also expanded. In Sarawak, CMSR and CMSPT have embraced the “contribute as we work” system whereby they provide complimentary road and pavement upgrading services to villages or residential areas near their worksites. Our efforts to date have included activities such as building crossover, general road cleaning, small pipe and culverts construction and the widening of side drainage areas, all aimed at enhancing the well-being of the local communities.

we will include green concepts in all our proposals to our clients to reflect the Group’s intent to continue spearheading Malaysia’s green building movement.

our commItment toWArds ourcommunIty & stAKehoLders

Supporting Charitable Homes and Schools

PPB remains committed to fulfilling our role as a responsible corporate citizen that is making a difference by elevating the well-being of the local communities. In Peninsular Malaysia, we continue to implement our Charitable Homes and Schools Adoption Programmes, whereby selected homes and schools that are in dire financial need and located within or nearby our worksites or offices, are placed under our care for a period of two years. In 2009, the residents of Pusat Jagaan Beribuan Kasih and the students of SJK (C) Lee Min benefited financially and materially from our efforts to improve their livelihood.

Employees of CMSR undertake a road upgrading exercise to widen and repair the

access road to Tanah Perkuburan Islam Kemunting in Bintulu, Sarawak

CMSR and CMSPT come together to lend assistancein cash and kind to folks who lost their 30-year old

longhouses to a fire at Rh. Gendi KampungSemilang in Sri Aman, Sarawak

33 employees from CMSR’s Betong branch office volunteer to clean up the building and surrounding area of the Betong

Buddhist Society at Paya Udak, Sarawak



Enhancing Educational Opportunities

As part of our contribution to nation building, the Group continues to provide educational opportunities for the younger generation. In 2009, we increased the value of the annual PPB scholarships for deserving but financially challenged scholars from RM92,000 to RM150,000 and awarded 14 new scholars from local universities and colleges, including some from Sarawak. Our management is also looking to further increase the scholarship fund in the coming year to enable more students to benefit from this programme.

Providing Internship Opportunities

The year saw 30 trainees participating in our internship programme which seeks to prepare students for working life by giving them practical hands-on experience. With many new projects secured in late 2009, trainee recruitment is expected to increase in 2010. The internship programme has also been opened up to the Group’s scholarship holders who need practical training over the course of their studies.

Elevating Communities

Our philanthropic efforts also extend to ad-hoc donations, and organisations such as the Kiwanis Club of Kuala Lumpur, the Ti-Ratana Welfare Society, Persatuan Kanak-kanak Istimewa

Local undergraduates specialising in building and construction-related studies

receive their Annual PPB Scholarships at PPB’s headoffice in Putrajaya

Kajang, Universiti Telekom Students’ Trust Fund, the GEL Project E.P.I.C. and the Buddhist Tzu-Chi Merit Society Malaysia. In early 2010, the Group made donations in-kinds to an orang asli community at Kampung Sekukuh, Pekan located within the vicinity of our project site at Tanjung Agas, Pahang. On top of this, CMSR and CMSPT made donations in cash and kind in aid of fire victims of Rh. Gendi Kampung Semilang, Sri Aman whose long houses had burnt down and participated in some other community activities. Proactively Engaging Stakeholders

We are committed to engaging with our stakeholders through the transparent and speedy delivery of pertinent information and are constantly improving our website, the primary platform for information dissemination. In early 2009, we subscribed to Bursa Malaysia Securities Berhad’s announcement feed thus enabling all our public announcements to be updated automatically on the investor relations section of our website. Plans are in the pipeline to make our investor relations section more user-friendly and we have also introduced a new section called “Corporate Responsibility Activities”, to update users on the latest such happenings. The year also saw us launching new websites for CMSR and CMSPT at www.cmsroads.com and www.cmspavement.com respectively, thus enabling easier and more convenient access to information pertaining to these companies.


quALIty, heALth And sAFety, envIronment stAtement

Putrajaya Perdana Berhad (“PPB”)’s vision to be the region’s Premier Builder builds on Teamwork, Knowledge and Commitment of our people & partners.

We are Committed:• To meet the quality requirement of our customers and

clients;

• To carry out our business in a manner that protects thehealth and safety of our employee, workers, suppliers, sub-contractors, clients, the general public and other interested parties at all times; and

• Tocarryout ourbusiness in amanner thatpreserves theenvironment at all times.

Group Policy on Quality• To constantly enhance our Quality Management System

conforming to ISO 9001 Standard;

• To continuously improve our business processes andservices;

• Toalwaysderiverealistic,practicalandeffectivesolutionstoissues we meet;

• Tocreateandmaintainaconduciveworkenvironment;and

• To develop smart partnership with all our businessassociates.

Group Policy on Health & Safety• To constantly enhance our Occupational Health & Safety

(OHS) Management System conforming to OHSAS 18001 Standard;

• To comply with all applicable OHS legal and otherrequirement;

• Toensureahealthyandsafeworkplaceforallouremployeesand workers;

• ToprovidecontinuousOHSawarenessandtrainingtoourpeople;

• Topromoteahealthyandsafeworkplaceculturetopreventall forms of accidents; and

• TocontinuouslyimproveourOHSperformance.

Group Policy on Environment• To constantly enhance our Environmental Management

System conforming to ISO 14001 Standard;

• Tocomplywithallapplicableenvironmentallegalandotherrequirements;

• Topreventenvironmentalpollution,toapply3Rpracticetomanage construction wastes, and to conserve energy and resources;

• Tocreateawareness,toprovidetrainingandtoencourageparticipation in implementing good environmental practices to our people, suppliers and sub-contractors; and

• Tocontinuouslyimproveourenvironmentalperformance.

ISO 9001 / OHSAS 18001 / ISO 14001 Certifications• PPB’s subsidiaries, Putra Perdana Construction Sdn Bhd

(“PPC”) and Putra Perdana Development Sdn Bhd (“PPD”), have been accredited with ISO 9001 by SIRIM since 2000.

• PPChasalsobeenaccreditedwithOHSAS18001bySIRIMsince 2006.

• PPChasfurtherbeenaccreditedwithISO14001bySIRIMin 2009.

• Implementationofabovepracticeshasalso ledtheGroupto become an effective and dynamic organization that is at ease with open communication and committed to continual improvement at all times.

Open Communication• Our day-to-day engagements at PPB involve regular

dialogues and open debates at all levels of the company, which encourages free exchange of ideas and information.

• Frequentmanagement-ledmeetingsalsohelptostrategise,plan, design and deliver higher performance and output.

• Investment in InformationCommunicationandTechnology(ICT) has provided convenient company-wide online links between the head office and all project sites.

77


quality, health and safety, environment statement

Continual Improvement• Key critical processes are regularly identified for

improvement.

• Improvedtechniquesandtechnologyarecontinuallysourcedand acquired in order to improve the speed and quality of our construction.

• Drivingdownunnecessarywastesisalwaysourpriority.

• Lessonslearntarecapturedforimprovedqualitycontrolandproblem solving.

• Regularauditsarecarriedouttoprovideusefulfeedbacktoour people.

• Top management-led reviews and meetings are regularlycarried out to provide the necessary guidance to all functional departments and project teams.

• Ourultimateobjectiveistodelivermorevalue-addedserviceto meet our customers’ current and future needs.

COnQUAS (Construction Quality Assessment System) by BCA, and QLASSIC (Quality Assessment System) by cIdB• Forbetterqualitycontrolofourworkmanship,wehavealso

taken company-wide initiative to incorporate CONQUAS (Construction Quality Assessment System) developed by BCA Singapore into our projects.

• BCA has been continually engaged to conduct trainingsessions and hands-on field demonstration for our staff and sub-contractors since 2007, in order to familiarise them with CONQUAS’ concept and practice.

• Regular in-house assessment sessions have since beenroutinely carried out in our projects.

• BCA and CIDB are regularly invited to carry out third-party independent quality assessment on our projects to benchmark against their standards (CONQUAS/QLASSIC).

5-S Programme• In2009,PPChasalsoembarkedonthe“5-SProgramme”

for its Felda Tower construction site, working closely with in-depth consultation from SIRIM and Hong Kong 5-S Association.

• Thiseffortwillbemadecompany-wideatallourworksites.

• Through the continuous effort in this practice, we aim toimprove our self discipline and nurture a culture to excel.

Good Action Award (GAA) Programme• We believe in that good people generate good thoughts,

and therefore deliver good actions.

• Annually,duringourAnnualDinner,weannouncetheGAAwinners for the following categories of performance: Q, HS, E, PG, PS, P & I (Quality, Health & Safety, Environmental, People Growth, Problem Solving, Productivity & Image).

ppedana-cover to page 78 (3mb).pdf

Documents

green building construction

corporate profile

green route

corporate information

corporate responsibility

group corporate structure

corporate governance

corporate milestones