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Directors Report Report Of The Auditors Income Statements Balance Sheets Statement Of Changes Cash Flow Statements Notes To The Financial Statements Statement And Declaration By Directors
Directors' Report
The directors of UNISEM (M) BERHAD have pleasure in submitting their report and the audited financial statements of the Group and the Company for the financial year ended December 31, 2000.
Principal Activities The Company is principally involved in the manufacturing of semiconductor devices. The subsidiary company, Unisem II Sdn. Bhd., a company incorporated in Malaysia, has not commenced operations since its incorporation. There has been no significant change in the nature of the activity of the Company during the financial year.
Results Of Operations The results of operations of the Group and the Company for the financial year are as follows:
The Group RM
The Company RM
Profit before tax Income tax expense Net profit for the year
In the opinion of the directors, the results of operations of the Group and the Company during the financial year have not been substantially affected by any item, transaction or event of a material and unusual nature.
Dividends A final dividend of 12%, tax-exempt, amounting to RM17,160,000 proposed in the previous financial year and dealt with in the previous directors report was paid by the Company during the current financial year. An interim dividend of 10%, tax-exempt, amounting to RM14,300,000 was paid in respect of the current financial year. The directors proposed a final dividend of 15%, tax-exempt, amounting to RM21,450,000 in respect of the current financial year.
UNISEM
(M)
BERHAD
183314-V
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Reserves And Provisions There were no material transfers to or from reserves or provisions during the financial year.
Issue Of Shares And Debentures The Company has not issued any new shares or debentures during the financial year.
Employee Share Option Scheme (ESOS) On August 3, 2000, the shareholders of the Company approved an ESOS for the benefit of eligible employees including full-time Executive Directors of the Company and its subsidiary company. The salient features of the ESOS are as follows: (a) The ESOS is set-up for participation in the ordinary share capital of the Company only; (b) The total number of new ordinary shares to be offered under the ESOS shall not exceed ten (10) per centum of the issued and paid-up share capital of the Company at any point in time during the existence of the scheme; (c) Eligible Malaysian employees (including full-time Executive Directors of the Company and its subsidiary company) are those who have been confirmed in service for at least one (1) continuous year while a non-Malaysian employee must have been employed for at least three (3) continuous years in any company within the Group on or prior to the date of offer pursuant to the ESOS; (d) The criterion of allotment of new shares is by reference to the position of the eligible employee. No option shall be granted for less than 1,000 ordinary shares nor more than 400,000 ordinary shares to any individual employee or full-time Executive Director; (e) The price payable for each ordinary share under the ESOS upon exercise of the option shall be at a discount of not more than ten (10) per centum from the weighted average of the mean market quotation (calculated as the average of the highest and lowest price transacted) of the ordinary shares as quoted and shown in the daily official list issued by the Kuala Lumpur Stock Exchange for the five (5) preceding market days prior to the date of the offer, or the par value of such share of the Company, whichever is the higher; (f) The ESOS shall be in force for a period of five (5) years commencing September 7, 2000;
(g) The options granted shall be capable of being exercised at any time or times during the option period; and (h) The ESOS Committee is appointed by the Board of Directors of the Company to administer the Scheme.
24
The movements in the options to take up unissued ordinary shares of RM1 each are as follows: Number Granted on September 14, 2000 Granted on October 3, 2000 Granted on December 13, 2000 Balance as of December 31, 2000 7,395,000 120,000 170,000 7,685,000 Option Price RM 14.80 13.50 10.20
There was no exercise of the options during the financial year. Other Financial Information Before the income statements and balance sheets of the Group and the Company were made out, the directors took reasonable steps: (a) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of provision for doubtful debts and have satisfied themselves that all known bad debts have been written off and that adequate provision has been made for doubtful debts; and (b) to ensure that any current assets which were unlikely to realise their book values in the ordinary course of business have been written down to their estimated realisable values. At the date of this report, the directors are not aware of any circumstances: (a) which would render the amount written off as bad debts or the provision for doubtful debts in the financial statements of the Group and the Company inadequate to any substantial extent; or (b) which would render the values attributed to current assets in the financial statements of the Group and the Company misleading; or (c) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and the Company misleading or inappropriate; or (d) not otherwise dealt with in this report or financial statements which would render any amount stated in the financial statements of the Group and the Company misleading. At the date of this report, there does not exist: (a) any charge on the assets of the Group and the Company which has arisen since the end of the financial year and secures the liability of any other person; or (b) any contingent liability of the Group and the Company which has arisen since the end of the financial year. No contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve months after the end of the financial year which, in the opinion of the directors, will or may substantially affect the ability of the Group and the Company to meet its obligations as and when they fall due.
UNISEM
(M)
BERHAD
183314-V
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In the opinion of the directors, no item, transaction or event of a material and unusual nature has arisen in the interval between the end of the financial year and the date of this report which is likely to affect substantially the results of operations of the Group and the Company for the succeeding financial year except as disclosed in Note 20 to the Financial Statements.
Directors The following directors served on the Board of the Company since the date of the last report: Mr. John Chia Sin Tet Y. Bhg. Tan Sri Dato Dr. Mohd. Rashdan bin Haji Baba Y. Bhg. Tan Sri Dato Samshuri bin Arshad Mr. Colin Garfield MacDonald Mr. Yen Woon @ Low Sau Chee Mr. Sundra Moorthi s/o V.M. Krishnasamy Mr. Francis Chia Mong Tet Mr. Tee Yee Loh Mr. Chua Khing Chiew (alternate to Yen Woon @ Low Sau Chee) Mr. Koo Hong @ Ku Hong Hai (retired on 18.4.2000) In accordance with Article 124 of the Companys Articles of Association, Messrs. Colin Garfield MacDonald, Yen Woon @ Low Sau Chee and Tee Yee Loh retire by rotation and, being eligible, offer themselves for re-election.
Directors Interest The shareholdings in the Company of those who were directors at the end of the financial year, as recorded in the Register of Directors Shareholdings kept by the Company under Section 134 of the Companies Act, 1965, are as follows: No. of ordinary shares of RM1 each Balance at Bought/ Sold/ Balance at 1.1.2000 Transferred* Transferred* 31.12.2000 Registered in name of director Y. Bhg. Tan Sri Dato Dr. Mohd. Rashdan bin Haji Baba Mr. Colin Garfield MacDonald Mr. Sundra Moorthi s/o V.M. Krishnasamy Mr. Francis Chia Mong Tet Mr. Tee Yee Loh
1,000,000*
26
No. of ordinary shares of RM1 each Balance at Bought/ Sold/ Balance at 1.1.2000 Transferred* Transferred* 31.12.2000 Deemed interest Mr. John Chia Sin Tet Y. Bhg. Tan Sri Dato Dr. Mohd. Rashdan bin Haji Baba Y. Bhg. Tan Sri Dato Samshuri bin Arshad Mr. Colin Garfield MacDonald Mr. Yen Woon @ Low Sau Chee Mr. Sundra Moorthi s/o V.M. Krishnasamy Mr. Francis Chia Mong Tet Mr. Tee Yee Loh Mr. Chua Khing Chiew (Alternate to Yen Woon @ Low Sau Chee)
1,000,000*
No. of ordinary shares under Option Balance at Balance at 1.1.2000 Granted Exercised 31.12.2000 Mr. John Chia Sin Tet 400,000 400,000
Directors Benefits Since the end of the previous financial year, none of the directors of the Company has received or become entitled to receive any benefit (other than those disclosed as directors remuneration in the financial statements) by reason of a contract made by the Company or a related corporation with the director or with a firm of which he is a member, or with a company in which he has a substantial financial interest except for any benefit which may be deemed to have arisen by virtue of the following: (a) Professional fees paid to a partnership business in which Mr. Sundra Moorthi s/o V.M. Krishnasamy is also a partner; and (b) Award of contracts as Project Managers for the construction and facilitization of plant expansion to a company in which Messrs. Francis Chia Mong Tet and Tee Yee Loh have financial interests. During and at the end of the financial year, no arrangement subsisted to which the Company was a party whereby directors of the Company might acquire benefits by means of the acquisition of shares in, or debentures of, the Company or any other body corporate except for the ESOS as disclosed.
UNISEM
(M)
BERHAD
183314-V
27
Auditor The auditors, Messrs. Deloitte KassimChan (formerly known as Kassim Chan & Co.), have indicated their willingness to continue in office.
28
We have audited the accompanying balance sheets as of December 31, 2000, the related statements of income, cash flows and changes in equity for the year then ended. These financial statements are the responsibility of the Companys directors. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the directors, as well as evaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion. In our opinion: (a) the abovementioned financial statements are properly drawn up in accordance with the provisions of the Companies Act, 1965 and the applicable approved accounting standards in Malaysia so as to give a true and fair view of: (i) the state of affairs of the Group and the Company as of December 31, 2000 and of the results and the cash flows of the Group and the Company for the year ended on that date; and
(ii) the matters required by Section 169 of the Act to be dealt with in the financial statements and consolidated financial statements; and (b) the accounting and other records and the registers required by the Act to be kept by the Company and by the subsidiary company have been properly kept in accordance with the provisions of the Act. We are satisfied that the financial statements of the subsidiary company that have been consolidated with the financial statements of the Company are in form and content appropriate and proper for the purposes of the preparation of the consolidated financial statements, and we have received satisfactory information and explanations as required by us for these purposes. The auditors report on the financial statements of the subsidiary company was not subject to any qualification and did not include any comment made under Sub-section (3) of Section 174 of the Act.
GREGORY WONG GUANG SENG 787/3/01(J/PH) Partner Ipoh, February 28, 2001
UNISEM
(M)
BERHAD
183314-V
29
Income Statements
For The Year Ended December 31, 2000
Note
The Group 2000 RM 403,880,264 9,840,993 199,970 (89,233,332) (46,499,051) (40,985,589) (69,998,628)
The Company 2000 1999 RM RM 403,880,264 9,840,993 199,970 (89,233,332) (46,499,051) (40,985,589) (69,994,690) 167,208,565 (20,393,000) 146,815,565 310,296,137 13,253,805 903,171 (62,833,959) (32,806,755) (22,474,309) (49,381,171) 156,956,919 526 156,957,445
Revenue Other operating income Changes in inventories of finished goods and work-in-progress Raw materials and consumables used Staff costs Depreciation of property, plant and equipment Other operating expenses Profit before tax Income tax expense Net Profit for the year 4 5
Diluted
102.6 sen
30
Balance Sheets
As Of December 31, 2000
Note
ASSETS Property, plant and equipment Subsidiary company Current Assets Inventories Trade receivables Other receivables, deposits and prepayments Fixed deposits, cash and bank balances 8 9 594,501,027 594,501,027 1,404,167 249,429,024
10
11
Current Liabilities Trade payables Other payables and accrued expenses Tax liabilities Proposed dividend
12 & 13 6
39,935,216 634,436,243
Represented by: Issued capital Reserves Shareholders Equity 15 16 143,000,000 491,436,243 634,436,243 143,000,000 491,440,181 634,440,181 143,000,000 380,374,616 523,374,616
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BERHAD
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The Group
Note
Issued Capital RM
Total RM
Balance as of January 1, 1999 Net profit for the year Dividends Balance as of December 31, 1999 Net profit for the year Dividends Balance as of December 31, 2000
143,000,000
152,392,308
143,000,000
152,392,308
143,000,000
152,392,308
339,043,935
634,436,243
The Company Balance as of January 1, 1999 Net profit for the year Dividends Balance as of December 31, 1999 Net profit for the year Dividends Balance as of December 31, 2000
143,000,000
152,392,308
143,000,000
152,392,308
143,000,000
152,392,308
339,047,873
634,440,181
32
Note CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES Profit before tax Adjustments for: Depreciation of property, plant and equipment (Gain)/Loss on disposal of property, plant and equipment Property, plant and equipment written off Interest income Overcapitalisation of land related expenses Operating Profit Before Working Capital Changes Increase in inventories Increase in trade receivables Increase in other receivables, deposits and prepayments (Decrease)/Increase in trade payables Increase in other payables and accrued expenses Cash Generated From Operations Interest received Income tax paid Net Cash Generated From Operating Activities CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES Proceeds from disposal of property, plant and equipment Acquisition of subsidiary company* Advances to subsidiary company Purchase of property, plant and equipment Net Cash Used In Investing Activities
167,204,627
167,208,565
156,956,919
201,417,867 (16,166,416) (17,658,883) (11,771,590) (2,525,330) 92,950,067 246,245,715 6,779,597 (2,924,472) 250,100,840
201,421,805 (16,166,416) (17,658,883) (10,370,363) (2,525,330) 92,949,067 247,649,880 6,779,597 (2,924,472) 251,505,005
167,596,998 (4,468,341) (24,974,608) (73,747) 9,040,232 48,294,899 195,415,433 11,553,326 (2,924,474) 204,044,285
(Forward)
UNISEM
(M)
BERHAD
183314-V
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Note CASH FLOWS USED IN FINANCING ACTIVITIES Dividends paid NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR CASH AND CASH EQUIVALENTS AT END OF YEAR
(31,460,000)
(31,460,000)
(28,600,000)
(167,474,670)
(167,474,672)
47,002,268
301,086,339
301,086,339
254,084,071
19
133,611,669
133,611,667
301,086,339
* ANALYSIS OF ACQUISITION OF SUBSIDIARY COMPANY During the financial year, the Company acquired Unisem II Sdn. Bhd.. acquired and the liabilities assumed are as follows: The fair value of the assets
RM Preliminary expenses Payables Total acquisition cost Less: Cash balance of subsidiary company acquired Cash flow on acquisition, net of cash required 2,350 (2,348) 2 (2)
34
1.
Principal Activities The Company is principally involved in the manufacturing of semiconductor devices. The subsidiary company, Unisem II Sdn. Bhd., a company incorporated in Malaysia, has not commenced operations since its incorporation. There has been no significant change in the nature of the activity of the Company during the financial year.
2.
Basis Of Preparation Of The Financial Statements The financial statements of the Group and the Company have been prepared in accordance with the provisions of the Companies Act, 1965 and the applicable approved accounting standards of the Malaysian Accounting Standards Board. During the financial year, the Group and the Company adopted the MASB 1, Presentation of Financial Statements which is effective for financial periods commencing on and after July 1, 1999. Accordingly, the presentation and disclosure of the financial information have been modified to conform with the requirements of MASB 1. Certain comparative figures have been reclassified to achieve a consistent presentation.
3.
Significant Accounting Policies Basis of Accounting The financial statements of the Group and the Company have been prepared under the historical cost convention. Revenue Revenue of the Company represents sales of goods at gross invoiced value less discounts and returns. Foreign Currency Conversion Transactions in foreign currencies are converted into Ringgit Malaysia at exchange rates prevailing at the transaction dates or, where settlement has not yet been made at the end of the financial year, at approximate exchange rates prevailing at that date. All foreign exchange gains or losses are taken up in the income statement. Income Tax The tax effects of transactions are generally recognised, using the liability method, when such transactions enter into the determination of net income regardless of when they are recognised for tax purposes. However, where timing differences give rise to a net deferred tax debit, the tax effects are recognised generally on actual realisation.
UNISEM
(M)
BERHAD
183314-V
35
Property, Plant and Equipment and Depreciation Property, plant and equipment are stated at cost less accumulated depreciation. Depreciation of all other property, plant and equipment except for capital work-in-progress which is not depreciated, is computed on the straight-line method at rates based on the estimated useful lives of the various assets. Long-term leasehold land is amortised over the period of the lease of 99 years. The annual depreciation rates are as follows: Buildings Plant and machinery Electrical installation Office equipment Air-conditioners Motor vehicles Furniture and fittings Basis of Consolidation The consolidated financial statements incorporate the financial statements of the Company and the subsidiary company made up to the end of the financial year. The results of subsidiay company acquired during the financial year are included in the consolidated financial statements from the effective date of acquisition. All significant intercompany transactions and balances are eliminated on consolidation. Investment Investment in subsidiary company, which is eliminated on consolidation is stated in the Companys financial statements at cost less provision for permanent diminution in value, if any. A provision is made when the directors are of the opinion that a permanent diminution in value of an investment has occurred. Inventories Inventories are valued at the lower of cost and net realisable value. Cost is determined on the weighted average method. The cost of raw materials and factory supplies comprises the original purchase price plus cost of bringing the inventories to their present location. The cost of work-inprogress and finished goods comprises the cost of raw materials, direct labour and an appropriate proportion of factory overheads. Receivables Bad debts are written off while provision for doubtful debts is made based on estimates of possible losses which may arise from non-collection of certain receivable accounts. 2% 10% 10% 10% 10% 20% 10%
36
Cash Flow Statements The Group and the Company adopt the indirect method in the preparation of the cash flow statements. Cash equivalents are short-term, highly liquid investments with maturities of three months or less from the date of acquisition and are readily convertible to cash with insignificant risks of changes in value.
4.
Profit Before Tax The Group 2000 RM Profit before tax is arrived at: After charging: Directors remuneration: Fees Other emoluments Rental of premises Loss on disposal of property, plant and equipment Audit fee: Statutory Special Preliminary expenses written off Property, plant and equipment written off The Company 2000 1999 RM RM
And crediting: Interest on fixed deposits Gain on foreign exchange Gain on disposal of property, plant and equipment 6,830,267 2,547,838 6,830,267 2,547,838 11,829,499 1,085,105 69,199
The estimated monetary value of benefits-in-kind received and receivable by directors otherwise than in cash from the Group and the Company amounted to RM50,050 (1999: RM54,417)
UNISEM
(M)
BERHAD
183314-V
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5.
Income Tax Expense The Group 2000 RM Income tax expense for the Group and the Company consists of: Current year Overprovision in prior year The Company 2000 1999 RM RM
20,393,000 20,393,000
20,393,000 20,393,000
(526) (526)
The effective tax rates of the Group and the Company for the current financial year are lower than the statutory income tax rate due mainly to pioneer status being granted in respect of certain products of the Company for a period of five years commencing February 1, 2000. In accordance with the Income Tax (Amendment) Act, 1999, tax on chargeable income for Year of Assessment 2000 (Preceding Year Basis) is waived. Accordingly, no provision for income tax was required to be made for the previous financial year.
6.
Dividends The Group and The Company An interim dividend of 10%, tax-exempt, amounting to RM14,300,000 was paid in respect of the current financial year. The directors have proposed a final dividend of 15%, tax-exempt, amounting to RM21,450,000 in respect of the current financial year. This dividend which is subject to approval by shareholders at the forthcoming Annual General Meeting, has been included as a liability in the financial statements. Dividends per share during the year is 25 sen (1999: 20 sen) The proposed final dividend is payable in respect of all shares in issue as at the date of the financial statements.
7.
Earnings Per Share Basic The basic earnings per share of the Group has been calculated based on the Groups profit after tax RM146,811,627 and on the number of ordinary shares in issue during the financial year of 143,000,000.
38
Diluted The fully diluted earnings per share for the Group for 2000 has been calculated based on the Groups profit after tax of RM146,811,627 and on the adjusted weighted average number of ordinary shares issued and issuable of 143,040,790. The adjusted weighted average number of ordinary shares issued and issuable has been arrived at based on the assumption that 40,790 of the shares issuable on the exercise of the share options, were issued on December 31, 2000.
8.
Property, Plant And Equipment Property, plant and equipment in 2000 consist of the following: The Group and The Company --------------------------------Cost----------------------------- ------------------Accumulated Depreciation-----------------At beginning At end At beginning Charge for At end of year Additions Disposals of year of year the year Disposals of year RM RM RM RM RM RM RM RM Long-term leasehold land Buildings Plant and machinery Electrical installation Office equipment Air-conditioners Motor vehicles Furniture and fittings Capital work-in-progress 2,992,941 17,081,528 2,260,588 286,216,474 343,484,641 5,864,870 1,903,159 3,762,902 2,277,606 427,332 1,226,253 2,958,145 82,866 1,226,097 560,179 9,143,401 34,361,318 329,673,690 386,156,610 2,992,941 123,446 33,710 19,342,116 1,438,322 367,406 (258,918) 629,442,197 73,838,973 38,667,552 7,768,029 2,117,261 646,054 (8,000) 6,032,508 897,761 477,636 1,653,585 97,817 108,229 3,041,011 1,272,585 546,520 1,786,276 458,501 138,482 43,504,719 (266,918) 715,563,382 80,244,666 40,985,589 157,156 1,805,728 (162,475) 112,344,050 2,763,315 (5,425) 1,369,972 206,046 1,819,105 596,983 (167,900) 121,062,355
Net Book Value At beginning At end of year of year RM RM Long-term leasehold land Buildings Plant and machinery Electrical installation Office equipment Air-conditioners Motor vehicles Furniture and fittings Capital work-in-progress 2,869,495 15,643,206 212,377,501 3,747,609 2,865,141 329,515 1,685,560 767,596 9,143,401 249,429,024 2,835,785 17,536,388 517,098,147 5,004,714 4,662,536 1,447,539 1,221,906 1,189,293 43,504,719 594,501,027
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(M)
BERHAD
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9.
Subsidiary Company The Company 2000 1999 RM RM Unquoted shares, at cost Amount owing by subsidiary company 2 1,404,165 1,404,167
The wholly-owned subsidiary company is Unisem II Sdn. Bhd., a company incorporated in Malaysia. The subsidiary company is pre-operating at balance sheet date. The amount owing by subsidiary company arose mainly from payments made on behalf for the acquisition of a piece of industrial land. The amount owing by subsidiary company is unsecured, interest-free and has no fixed repayment terms.
10. Inventories The Group 2000 RM At cost: Finished goods Work-in-progress Raw materials Factory supplies The Company 2000 1999 RM RM
The Group 2000 RM Fixed deposits with licensed banks Cash and bank balances 125,739,680 7,871,989 133,611,669
The Company 2000 1999 RM RM 125,739,680 7,871,987 133,611,667 297,070,982 4,015,357 301,086,339
40
12. Other Payables And Accrued Expenses Other payables and accured expenses comprise of: The Group 2000 RM Other payables Accrued expenses 152,414,704 5,562,744 157,977,448 The Company 2000 1999 RM RM 152,414,704 5,561,744 157,976,448 54,458,628 10,568,753 65,027,381
Other payables arose mainly from the acquisition of plant and machinery and facilitisation of cleanrooms in line with the expansion programme embarked by the Company.
13. Related Party Transactions Related parties are entitles which have common directors and/or shareholders with the Company, excluding those disclosed as related companies. During the financial year, the significant related party transactions are as follows: 2000 RM Amount paid to a company which directors have substantial interests for services rendered to the company Professional fees paid to a firm in which a director is a partner 1999 RM
3,438,488 3,875
116,831 16,320
The directors of the Company are of the option that the above transactions have been entered in the normal course of business and have been established under terms that are no less favourable than those arranged with independent third parties. The outstanding balances arising from the above transactions are as follows: 2000 RM Payables: Included in other payables` 1999 RM
133,455
UNISEM
(M)
BERHAD
183314-V
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14. Deferred Taxation Details of potential deferred tax liability, calculated under the liability method, are as follows: The Group 2000 RM Cumulative timing differences between depreciation and tax allowances on property, plant and equipment Potential deferred tax liability not taken up in the financial statements calculated at 28% tax rate 74,384,000 The Company 2000 1999 RM RM 74,384,000 44,574,000
20,827,000
20,827,000
12,481,000
The potential deferred tax liability of the Group and the Company is not provided for in the financial statements as it is anticipated that the tax effect of such deferrals will continue in the foreseeable future. 15. Share Capital The Group 2000 RM Authorised: Ordinary shares of RM1 each Issued and fully paid: Ordinary shares of RM1 each 16. Reserves Subject to agreement with the Inland Revenue Board, the Company has a tax-exempt account arising from its pioneer status amounting to approximately RM131,304,000 (1999: RM140,301,000) and a Section 108 tax credit of RM23,636,000 (1999: RM3,243,000). The Company also has a special tax-exempt account arising from the waiver of tax on chargeable income for Year of Assessment 2000 (Preceding Year Basis) of approximately RM118,606,000. Accordingly, the Company may distribute in full all of its unappropriated profit as at December 31, 2000 by way of cash dividends without incurring any additional income tax. 17. Capital Commitments The Group 2000 RM Capital expenditure: Contracted but not provided for Approved but not contracted for 90,130,000 90,130,000 The Company 2000 1999 RM RM 84,654,000 84,654,000 64,770,000 237,162,000 301,932,000 500,000,000 The Company 2000 1999 RM RM 500,000,000 500,000,000
143,000,000
143,000,000
143,000,000
42
18. Segmental Information The Company operates within one industry and one geographical area. information is not presented. As such, segmental
19. Cash And Cash Equivalents Cash and cash equivalents comprise the following: The Group 2000 RM Fixed deposits with licensed banks Cash and bank balances 125,739,680 7,871,989 133,611,669 The Company 2000 1999 RM RM 125,739,680 7,871,987 133,611,667 297,070,982 4,015,357 301,086,339
20. Subsequent Event On February 23, 2001, the Company subscribed for an additional 299,998 new ordinary shares of RM1 each at par in its wholly-owned subsidiary company, Unisem II Sdn. Bhd. There was no change in the Groups effective interest.
21. General Information The total number of employees of the Group and the Company at year end were 3,199 (1999: 2,099). The registered office and principal place of business of the Group and the Company are as follows: Registered Office : Letter Box #95, 9th Floor, UBN Tower, No. 10, Jalan P. Ramlee, 50250 Kuala Lumpur. No. 1, Persiaran Pulai Jaya 9, Kawasan Perindustrian Pulai Jaya, 31300 Ipoh.
22. Comparative Figures As the consolidated balance sheet, statements of income, cash flow and changes in equity have been drawn up for the first time, no comparative figures are presented.
UNISEM
(M)
BERHAD
183314-V
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STATEMENT BY DIRECTORS
The directors of UNISEM (M) BERHAD state that, in their opinion, the accompanying balance sheets and statements of income, cash flows and changes in equity, are drawn up in accordance with the provisions of the Companies Act, 1965 and the applicable approved accounting standards in Malaysia so as to give a true and fair view of the state of affairs of the Group and the Company as of December 31, 2000 and of the results of their businesses and the cash flows of the Group and the Company for the year ended on that date. Signed in accordance with a resolution of the Directors,
JOHN CHIA SIN TET COLIN GARFIELD MACDONALD Kuala Lumpur, February 28, 2001
DECLARATION BY THE DIRECTOR PRIMARILY RESPONSIBLE FOR THE FINANCIAL MANAGEMENT OF THE COMPANY
I, JOHN CHIA SIN TET, the director primarily responsible for the financial management of UNISEM (M) BERHAD, do solemnly and sincerely declare that the accompanying balance sheets and statements of income, cash flows and changes in equity are, in my opinion, correct, and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the Statutory Declarations Act, l960.
Subscribed and solemnly declared by the abovenamed JOHN CHIA SIN TET at KUALA LUMPUR on 28th day of February, 2001.
) ) )
Before me,
44
1.
COMPOSITION OF THE AUDIT COMMITTEE The Committee shall consist of at least three (3) members but not more than five (5) members, appointed by the Board from amongst the Directors, comprising a majority of directors independent of management and executive functions (independent non-executive Directors. If a member of an audit committee resigns, dies or for any other reason ceases to be a member with the result that the number of members is reduced below three (3), the Board shall, within three (3) months of that event, appoint such number of new members as may be required to make up the minimum number of three (3) members. The Chairman of the Audit Committee shall be appointed by the Board from amongst the independent non-executive Directors.
2.
MEETING The Audit Committee shall meet at least three (3) times per year, and as many times as the Committee deems necessary.
3.
ATTENDANCE The quorum for the Audit Committee shall be two (2) members who are independent non-executive Directors. As necessary or desirable, the Chairman may request that members of management, the internal auditor and representatives of the independent auditors be present at meetings of the Committee.
4.
MINUTES 4.1 The Company Secretary of the Company shall be present at all meetings to record minutes. 4.2 Minutes of each meeting shall be prepared and sent to Committee members, and the Companys Directors who are not members of the Committee. A copy of the minutes shall be filed with the Company.
5. TERMS OF REFERENCE I) Authority The Audit Committee shall be granted the authority to investigate any activity of the Company and its subsidiaries and all employees shall be directed to co-operate as requested by members of the Committee. The Committee shall be empowered to retain persons having special competence as necessary to assist the Committee in fulfilling its responsibilities.
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II)
Responsibilities a. The Audit Committee shall serve as a focal point for communications between NonCommittee Directors, the independent auditors, internal auditors and the Company's management, as their duties relate to financial accounting, reporting and controls. The Audit Committee shall assist the Board of Directors in fulfilling its fiduciary responsibilities as to accounting policies and reporting practices of the Company and its subsidiaries and the sufficiency of auditing relating thereto. The Audit Committee shall be the Board's principal agent in assuring the independence of the Company's independent auditors, the integrity of management, and the adequacy of disclosures to stockholders. The opportunity for the independent auditors to meet with the entire Board of Directors as needed is not be restricted, however.
b.
c.
III) Specific Duties The Audit Committee shall at all times comply with Section 344A of the Kuala Lumpur Stock Exchange Listing Requirements and in particular shall: a. Inform the independent auditors and management that the independent auditors and the Committee may communicate with each other at all times and the independent auditors have the right to appear and be heard at any meeting of the Committee and shall appear before the Committee when required to do so by the Committee; and the Committee Chairman may call a meeting whenever he deems it necessary or upon the request of the independent auditors. Review with the Company's management, independent auditors and the internal auditor, the Company's general policies and procedures to reasonably assure the adequacy of internal accounting and financial reporting controls. Have familiarity, through the individual efforts of its members, with the accounting and reporting principles and practices applied by the Company in preparing its financial statements. Further, the Committee shall make, or cause to be made, all necessary inquiries to management and the independent auditors concerning established standards of corporate conduct and performance, and deviations therefrom. Review, prior to the annual audit, the scope and general extent of the independent auditors' audit examination, including their engagement letter. The auditors' fees are to be arranged with management, and annually summarised for Committee review. The Committee's review should entail an understanding from the independent auditors of the factors considered by the auditors in determining his audit scope, including: Industry and business risk and characteristics of the Company. External reporting requirements. Materiality of the various segments of the Company's consolidated and non-consolidated activities. Quality of internal accounting controls. Extent of involvement of internal audit in the audit examination. Other areas to be covering during the audit engagement.
b.
c.
d.
46
e.
Review the extent of non-audit services provided by the independent auditors in relation to the objectivity needed in the audit. Review with management and the independent auditors, upon completion of their audit, financial results for the year, prior to their submission to the Board and release to the public. This review shall encompass: The Company's annual report to shareholders including the financial statements and supplemental disclosures required by generally accepted accounting principles and the International Accounting Standards. Significant transactions not a normal part of the Company's operations. Changes, if any, during the year in the Company's accounting principles or their applications. Significant adjustments proposed by the independent auditors.
f.
g.
Evaluate the co-operation received by the independent auditors during the audit examination, including their access to all requested records, date and information. Also, elicit the comments of management regarding the responsiveness of the independent auditors to the Company's needs. Inquire of the independent auditors whether there have been any disagreements with management, which if not satisfactorily resolved would have caused them to issue a non-standard report on the Company's financial statements. Discuss with the independent auditors the quality of the Company's financial and accounting personnel, and any relevant recommendations which the independent auditors may have (including those in their "letter of comments and recommendations"). Topics to be considered during this discussion include improving internal financial controls, the audit plan, the audit report, the selection of accounting principles, any related party transaction that may arise within the Company and management reporting system. Review written responses of management to "letter of comments and recommendations" from the independent auditors. Discuss with Company management the scope and quality of internal accounting and financial reporting controls in effect. Inform the Board of Directors, through minutes and special presentations as necessary, of significant developments in the course of performing the above duties. Recommend to the Board of Directors any appropriate extension or changes in the duties of the Committee. Recommend to the Board of Directors the retention or non-retention of the independent auditors, and provide a written summary of the basis for the recommendations.
h.
i.
j.
k.
l.
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Shareholding Statistics
As At 16th March 2001
1.
Authorised Share Capital Issued and paid-up Share Capital Class of Shares Voting Right
: : : :
2.
Distribution of shareholders No. of holders 39 3802 433 147 1 Holdings Less than 1,000 1,000 to 10,000 10,001 to 100,000 100,001 to less than 5% of issued shares 5% and above of issued shares Total holdings 3,805 8,406,472 15,038,089 75,651,634 42,900,000 % 0.00 5.88 10.52 53.60 30.00
3.
List of substantial shareholders (2% and above excluding bare trustees) and their direct and deemed interests as shown in the Register of Substantial Shareholders Direct Interest No. of shares held % of total issued shares 30.00
(a)
Bandar Rasah Sdn Bhd The Great Eastern Life Assurance Co Ltd Colin Garfield MacDonald Employees Provident Fund Board Jayvest Holdings Sdn Bhd Prudential Portfolio Managers Singapore Ltd Great Eastern Life Assurance (Malaysia) Berhad Koo Hong @ Ku Hong Hai
42,900,000
(c)
(d)
3,514,000
2.46
(e)
3,471,000 3,083,063
2.43 2.16
48
List of substantial shareholders (contd) Direct Interest No. of shares held % of total issued shares 1.02 0.28 Deemed Interest No. of shares held % of total issued shares 1.82 32.77 32.49 30.00 30.17 30.00
(c)
Francis Chia Mong Tet John Chia Sin Tet Soo Yut Kuan Noadwood Sdn Bhd Yen Woon @ Low Sau Chee Chua Khing Chiew Oversea-Chinese Banking Corporation Ltd Great Eastern Holdings Limited GEL Capital (Malaysia) Berhad
1,458,200 400,000
(f)
(g)
(d)
(h)
(i)
(j)
(j)
(b)
Notes: (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) Held as bare trustee by Malaysia Nominees (Asing) Sdn Bhd Held indirectly through Great Eastern Life Assurance (Malaysia) Berhad Held indirectly through nominee companies under pledged securities accounts Held indirectly through Bandar Rasah Sdn Bhd Held as bare trustee by Malaysia Nominees (Tempatan) Sdn Bhd Held indirectly through his spouse, Bandar Rasah Sdn Bhd and Jayvest Holdings Sdn Bhd Held indirectly through Bandar Rasah Sdn Bhd and Jayvest Holdings Sdn Bhd Held indirectly through his spouse and Noadwood Sdn Bhd Held indirectly through Noadwood Sdn Bhd Held indirectly through The Great Eastern Life Assurance Co Ltd, Great Eastern Life Assurance (Malaysia) Berhad, The Overseas Assurance Corporation Ltd and Overseas Assurance Corporation (M) Bhd
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4.
List of Directors shareholding as shown in the Register of Directors Direct Interest No. of shares held John Chia Sin Tet Y. Bhg. Tan Sri Dato Dr Mohd Rashdan bin Haji Baba Y. Bhg. Tan Sri Dato Samshuri bin Arshad Colin Garfield MacDonald Yen Woon @ Low Sau Chee Sundra Moorthi s/o V.M. Krishnasamy Francis Chia Mong Tet Tee Yee Loh Chua Khing Chiew
Notes: (a) Held (b) Held (c) Held (d) Held (e) Held
Deemed Interest No. of shares held 46,855,600 17,000 200,000 1,700,000 43,150,000 2,000 2,600,000 948,810 42,900,000 % of total issued shares 32.77 0.00 0.14 1.19 30.17 0.00 1.82 0.66 30.00
(a)
(b)
(b)
(b)
(c)
(d)
(b)
(b)
(e)
his spouse, Bandar Rasah Sdn Bhd and Jayvest Holdings Sdn Bhd. nominee companies under pledged securities accounts. his spouse and Noadwood Sdn Bhd. his spouse. Noadwood Sdn Bhd.
5.
List of thirty largest shareholders according to the Record of Depositors (without aggregating the securities from different securities from different securities accounts belonging to the same person(s)) Shareholders No. of shares held (direct interest) 42,900,000 % of issued shares 30.00
1. 2.
5,155,000 5,011,049
3.60 3.50
3.
50
List of thirty largest shareholders (contd) Shareholders No. of shares held (direct interest) 4,133,000 3,555,600 3,471,000 3,083,063 % of issued shares 2.89 2.49 2.43 2.16
4. 5. 6. 7. 8.
Employees Provident Fund Board Jayvest Holdings Sdn Bhd Malaysia Nominees (Tempatan) Sdn Bhd
Qualifier: Great Eastern Life Assurance (Malaysia) Berhad
9. 10. 11.
Malaysia National Insurance Berhad Chase Malaysia Nominees (Asing) Sdn Bhd
Qualifier: Abu Dhabi Investment Authority
Tee Yee Loh Francis Chia Mong Tet DB (Malaysia) Nominee (Asing) Sdn Bhd
Qualifier: DB GCS London for Morgan Grenfell Global Select Funds Global Emerging Markets Fund
1,350,000
0.94
15.
1,316,000 1,307,000
0.92 0.91
16. 17.
Low Kim Bee @ Lau Kim Bee HSBC Nominees (Asing) Sdn Bhd
Qualifier: HSBC BK PLC for Prudential Assurance Company Ltd
1,292,000
0.90
18.
1,032,000
0.72
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List of thirty largest shareholders (contd) Shareholders No. of shares held (direct interest) % of issued shares
19.
1,000,000 1,000,000
0.70 0.70
20. 21.
1,000,000 918,000
0.70 0.64
22. 23.
Overseas Assurance Corporation (Malaysia) Berhad HLG Nominee (Asing) Sdn Bhd
Qualifier: APS Asset Management Pte Ltd for Sampo Life Insurance Co Ltd
911,000
0.64
24.
848,000 755,000
0.59 0.53
25. 26.
600,000
0.42
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List Of Properties
Location
Description
Existing Use
Tenure
Area
Age of building 19
Book Value
Factory
6.294 hectare
RM20,372,173
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