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Contents
2 Notice of Annual General Meeting
FINANCIAL STATEMENTS
5 Nomination of Auditors
6 Statement Accompanying Notice of 42 Directors’ Report
Annual General Meeting
48 Statement by Directors
7 Corporate Information
48 Statutory Declaration
8 Corporate Structure
49 Independent Auditors’ Report
10 Chairman’s Statement 55 Statements of Profit or Loss and
Other Comprehensive Income
12 Management Discussion and
Analysis 56 Statements of Financial Position
16 Directors’ Profile 58 Statement of Changes in Equity
19 Senior Management’s Profile 60 Statements of Cash Flows
21 Corporate Governance Overview
62 Notes to the Financial Statements
Statement
26 Audit & Risk Management
Committee Report 114 Analysis of Shareholdings
29 Directors’ Responsibilities Statement 116 Analysis of Warrant Holdings
AGENDA
Ordinary Business
1. To receive the Audited Financial Statements for the financial year ended 31 Please refer to
December 2017 together with the Reports of Directors and Auditors thereon. Note 7
2. To re-elect Mr. Fong Yit Meng, a Director who retires by rotation in Resolution 1
accordance with Article 95 of the Company’s Constitution and who, being
eligible, offers himself for re-election.
3. To re-elect Mr. Leong Woay Hong @ Neoh Woay Hong, a Director who retires Resolution 2
by rotation in accordance with Article 95 of the Company’s Constitution and
who, being eligible, offers himself for re-election.
4. To approve the payment of Directors’ fees for the financial year ended 31 Resolution 3
December 2017 and financial year ending 31 December 2018. Please refer to
Note 8
6. To appoint Messrs STYL Associates (AF 1929) as auditors of the Company for Resolution 5
the ensuing year in place of the retiring auditors, Messrs Afrizan Tarmili Please refer to
Khairul Azhar and to authorise the Directors to fix their remuneration. Note 9
Special Business
To consider and if thought fit, to pass with or without any modifications the
following ordinary resolutions:-
AND THAT, such authority shall commence immediately upon the passing of
this resolution and continue to be in force until the conclusion of the next
AGM of the Company.”
8. To transact any other business of which due notice shall have been given in accordance with the
Company’s Constitution and the Companies Act, 2016.
EKA NOODLES BERHAD (583565-U)
2 ANNUAL REPORT 2017
NOTICE OF
ANNUAL GENERAL MEETING (Cont’d)
FURTHER NOTICE IS HEREBY GIVEN THAT for the purpose of determining a member who shall be
entitled to attend the 15th AGM, the Company shall be requesting Bursa Malaysia Depository Sdn.
Bhd. to issue a General Meeting Record of Depositors as at 15 May 2018 Only a depositor whose
name appears on the Record of Depositors as at 15 May 2018 shall be entitled to attend the 15 th
AGM or appoint proxies to attend and/or vote on his/her behalf.
Penang
Date: 23 April 2018
(2) For a proxy to be valid, the proxy form duly completed must be deposited at the registered
office of the Company at 51-21-A Menara BHL Bank, Jalan Sultan Ahmad Shah, 10050
Penang not less than 24 hours before the time appointed for the taking of the poll or at any
adjournment thereof.
(3) A member shall be entitled to appoint 1 or more proxies to attend and vote instead of
him at the same meeting and where a member appoints more than 1 proxy to vote at the
same meeting, such appointment shall be invalid unless he specifies the proportion of his
shareholding to be represented by each proxy.
(4) Where a member is an exempt authorized nominee which holds ordinary shares of the
Company for multiple beneficial owners in one securities account (“omnibus account”), there
is no limit to the number of proxies it may appoint in respect of each omnibus account it
holds.
(5) In the case of a corporate member, the proxy form must be executed under the corporation’s
common seal or under the hand of an officer or attorney duly authorised.
(6) Pursuant to Paragraph 8.29A of the Main Market Listing Requirements of Bursa Malaysia
Securities Berhad, all the resolutions set out in this Notice will be put to vote by poll.
(7) The Agenda 1 is meant for discussion only as the provision of Section 340(1)(a) of the
Companies Act 2016 does not require the shareholders’ approval for the Audited Financial
Statements. Hence, the Agenda 1 is not put forward for voting.
(8) The proposed Directors’ fees and benefits payable to non-executive directors are in the best
interest of the Company and are in accordance with the remuneration framework of the
Group. The details are as follows:
The Resolution 3, if approved, will facilitate the payment of directors’ fees to non-executive
directors for the financial year ended 31 December 2017 and financial EKA year ending
NOODLES 31 (583565-U)
BERHAD
3
December 2018. The directors’ fees payable are based on the number ANNUAL of non-executive
REPORT 2017
directors. In the event, there is an increase in fees, approval will be sought at the next AGM
of the Company.
(6) Pursuant to Paragraph 8.29A of the Main Market Listing Requirements of Bursa Malaysia
Securities Berhad, all the resolutions set out in this Notice will be put to vote by poll.
(8) The proposed Directors’ fees and benefits payable to non-executive directors are in the best
interest of the Company and are in accordance with the remuneration framework of the
Group. The details are as follows:
The Resolution 3, if approved, will facilitate the payment of directors’ fees to non-executive
directors for the financial year ended 31 December 2017 and financial year ending 31
December 2018. The directors’ fees payable are based on the number of non-executive
directors. In the event, there is an increase in fees, approval will be sought at the next AGM
of the Company.
The Resolution 4, if approved, will enable the Company to pay meeting allowance and other
benefits to non-executive directors of the Company. The total amount of directors’ benefits
payable is estimated based on the number of scheduled meetings of the Board and Board
Committees as well as the number of non-executive directors involved in these meetings.
(9) The Company had received a letter dated 11 April 2018 from a shareholder of the Company
nominating Messrs. STYL Associates (AF 1929), who has given their consent to act as the
new statutory auditors of the Company. A copy of the letter is annexed and marked as
“Appendix A” in the Company’s Annual Report for the financial year ended 31 December
2017.
The Resolution 5, if approved, Messrs. STYL Associates shall hold office until the conclusion
of the next AGM of the Company.
(10) The Resolution 6, if approved, will enable the Directors to allot and issue shares in the
Company up to an amount not exceeding 10% of the total number of issued shares of the
Company for the time being for such purposes as the Directors consider will be in the best
interest of the Company. This authority, unless revoked or varied by the shareholders of the
Company in a general meeting will expire at the conclusion of the next AGM.
The proposed renewal of general mandate for issuance of shares will provide flexibility to the
Company for any possible fund raising activities, including but not limited to placing of shares
for the purpose of funding future investment, working capital and/or acquisition.
As at the date of this notice, the Directors have not issued any shares pursuant to the
general mandate granted at the last AGM of the Company.
1) No individuals are standing for election as directors at the forthcoming 15th Annual General
Meeting of the Company.
2) The profiles of the directors who are standing for re-election as in Agenda 2 and 3 of the
Notice of the 15th Annual General Meeting of the Company are set out in the Directors’ Profile
section of this Annual Report.
3) The details of the directors’ interests in the securities of the Company as at 30 March 2018
are set out in the Statistic of Shareholdings section of this Annual Report.
4) The Resolution 5 tabled under Special Business as per the Notice of 15th Annual General
Meeting of the Company dated 23 April 2018 is a renewal of general mandate granted by
shareholders of the Company at the last Annual General Meeting held on 26 May 2017.
The proposed renewal of general mandate for issuance of shares will provide flexibility to the
Company for any possible fund raising activities, including but not limited to further placing of
shares for the purpose of funding future investment, working capital and/or acquisition.
As at the date of notice of meeting, the Directors have not issued any shares pursuant to the
general mandate granted at the last Annual General Meeting of the Company.
BOARD
BOARDOF DIRECTORS
OF DIRECTORS REGISTERED
REGISTERED OFFICE
OFFICE
Chairman
Chairman
/ Non-Independent
/ Non-Independent
Non-Executive
Non-Executive
Director
Director 51-21-A,
51-21-A,
Menara
Menara
BHLBHL
BankBank
Y. Bhg.
Y. Bhg.
Tan Tan
Sri Dato’
Sri Dato’
Seri Seri
Tan Tan
KingKing
Tai @
TaiTan
@ Tan
KhoonKhoon
Hai Hai JalanJalan
Sultan
Sultan
Ahmad
Ahmad
ShahShah
1005010050
Penang
Penang
Executive
Executive
Director
Director Tel No.
Tel 04-2108833
No. 04-2108833
FongFong
Yit Meng
Yit Meng Fax No.
Fax 04-2108831
No. 04-2108831
Independent
Independent
Non-Executive
Non-Executive
Directors
Directors REGISTRARS
REGISTRARS
Leong
Leong
Woay Woay
HongHong
@ Neoh
@ Neoh
Woay Woay
HongHong Tricor
Tricor
Investor
Investor
& Issuing
& Issuing
House
House
Services
Services
Sdn.Sdn.
Bhd.Bhd.
Dato’Dato’
Dr. Chin
Dr. Chin
YewYew
Sin (JP)
Sin (JP) Unit Unit
32-01,
32-01,
LevelLevel
32, Tower
32, Tower
A, Vertical
A, Vertical
Business
Business
SuiteSuite
Lim Choo
Lim Choo
HooiHooi Avenue
Avenue
3, Bangsar
3, Bangsar
South
South
Khairuddin
Khairuddin
Bin Jaflus
Bin Jaflus No. 8,
No.
Jalan
8, Jalan
Kerinchi
Kerinchi
5920059200
Kuala Kuala
Lumpur
Lumpur
AUDIT
AUDIT
& RISK
& RISK
MANAGEMENT
MANAGEMENT COMMITTEE
COMMITTEE Tel Tel : 03-2783
: 03-2783
92999299
Leong
Leong
Woay Woay
HongHong
@ Neoh
@ Neoh
Woay Woay
HongHong
(Chairman)
(Chairman) Fax Fax : 03-2783
: 03-2783
92229222
Dato’Dato’
Dr. Chin
Dr. Chin
YewYew
Sin (JP)
Sin (JP)
Lim Choo
Lim Choo
HooiHooi HEADHEAD
OFFICE
OFFICE
Lot 208,
Lot 208,
Phase
Phase
II II
REMUNERATION
REMUNERATION COMMITTEE
COMMITTEE Kuala
Kuala
KetilKetil
Industrial
Industrial
EstateEstate
Lim Choo
Lim Choo
HooiHooi
(Chairman)
(Chairman) 09300
09300
KualaKuala
KetilKetil
Dato’Dato’
Dr. Chin
Dr. Chin
YewYew
Sin (JP)
Sin (JP) Kedah
Kedah
DarulDarul
Aman Aman
Leong
Leong
Woay Woay
HongHong
@ Neoh
@ Neoh
Woay Woay
HongHong Tel Tel : 04-416
: 04-416
22222222
Fax Fax : 04-416
: 04-416
20222022
NOMINATING
NOMINATING COMMITTEE
COMMITTEE
Leong
Leong
Woay Woay
HongHong
@ Neoh
@ Neoh
Woay Woay
HongHong
(Chairman)
(Chairman) STOCK
STOCK
EXCHANGE
EXCHANGE LISTING
LISTING
Dato’Dato’
Dr. Chin
Dr. Chin
YewYew
Sin (JP)
Sin (JP) MainMain
Market
Market
of Bursa
of Bursa
Malaysia
Malaysia
Securities
Securities
Berhad
Berhad
Lim Choo
Lim Choo
HooiHooi Stock
Stock
CodeCode
: 7182
: 7182
Stock
Stock
NameName
: EKA: EKA
COMPANY
COMPANYSECRETARIES
SECRETARIES
Tan Tan
TongTong
LangLang
(MAICSA
(MAICSA
7045482)
7045482)
P’ngP’ng
Chiew
Chiew
Keem Keem
(MAICSA
(MAICSA
7026443)
7026443)
Chong
Chong
VoonVoon
WahWah
(MAICSA
(MAICSA
7055003)
7055003)
AUDITORS
AUDITORS
Afrizan
Afrizan
Tarmili
Tarmili
Khairul
Khairul
AzharAzhar
(AF1300)
(AF1300)
Chartered
Chartered
Accountants
Accountants
No. 2,
No.
Jalan
2, Jalan
Rampai
Rampai
Niaga
Niaga
2 2
Rampai
Rampai
Business
Business
ParkPark
5330053300
KualaKuala
Lumpur
Lumpur
Tel Tel : 03-4143
: 03-4143
93309330
Fax Fax : 03-4142 : 03-4142
93309330
BANKERS
BANKERS
Public
Public
BankBank
Berhad
Berhad
BankBank
Kerjasama
Kerjasama
Rakyat
Rakyat
Malaysia
Malaysia
Berhad
Berhad
BankBank
Pertanian
Pertanian
Malaysia
Malaysia
Berhad
Berhad
SOLICITORS
SOLICITORS
Ng &Ng
Teo
& Teo
VeonVeon
Szu Szu
& Kok
& Kok
ThyeThye
100%
Kilang Bihun Bersatu
Sdn Bhd
100% 100%
Bersatu Biotechnology Bersatu Sago Industries
(Johore) Sdn Bhd (Mukah) Sdn Bhd
100% 100%
Kilang Bihun Bersatu Bersatu Noodles
(East Malaysia) Industries Sdn Bhd
Sdn Bhd
100% 100%
EKA Foodstuff Bersatu Sago Industries
Sdn Bhd Sdn Bhd
Dear shareholders, on behalf of the Board of Directors, I am honoured to present to you EKA Noodles
Berhad’s (“EKA”) annual report for the financial year ended 31 December 2017 (“FY2017”).
Financial Performance
FY 2017 was a very challenging year for the Group. In March 2017, the new management undertook
rigorous internal rationalization to strategise the Group. Correspondingly, we managed to resume our
operations in May 2017 against the backdrop of our financial condition and persistent challenging
operating environment.
In FY2017, the Group registered a revenue of RM13.15 million versus RM23.91 million in FY2016 and
this was because the 3 main subsidiaries only resumed its operation fully in the second half of 2017.
Although our financial performance in FY2017 was hit with a loss before tax of RM5.01 million, the Group
recorded encouraging improvements as compared to a loss before tax of RM34.44 million in preceding
financial year (FY2016).
In FY2017, our operating expenses reduced by RM 34.53 million to RM20.68 million mainly due to
massive cost cutting measures and operational efficiencies. Whilst, the administrative expenses also
reduced by 71.22% to RM6.65 million in FY2017 as compared to RM23.11 million in FY2016.
In pursuit to regularize the financial condition of the Company, EKA had announced a string of series of
proposals which had been formulated to address and uplift the PN17 status of the Company with the main
objective to return the Company to a better financial standing and profitability.
We had spent the past year putting in place the pillar to spearhead the future of EKA and we look forward
for your continued support.
Industry Outlook
Referencing the world economic outlook update published by IMF (International Monetary Fund), global
growth for 2018 and 2019 has been revised upwards to 3.9%. Specifically, growth rates for euro area
economies such as Germany, Italy and the Netherlands have been marked up as a result of stronger
momentum in both domestic and external demands while the outlook for Malaysia remains resilient and
positive with gross domestic product (“GDP”) growth expected to be within 5% to 5.5%.
In a report issued in January 2018, the MIER (Malaysian Institute of Economic Research) noted the
exceptional performance of the local economy last year driven by strong domestic demand underpinned
by improvements in both investment and consumption and reinforced by a sturdy global demand. The
Malaysian economy grew by about 5.6% in 2017 with sustained manufacturing activities supported by
double digit growth in exports. The upbeat consumer spending is attributable to a stable job market,
contained core inflation and strengthening Ringgit Malaysia, as well as several government measures to
boost disposable income as announced in the 2018 Budget. Nonetheless, there are signs of consumers
being more pragmatic and cautious in their spending.
The Malaysian economy is expected to grow at 5.4% this year, again driven by domestic demand
particularly from the private sector, which in turn is projected to grow at 5.2% as well as buoyant external
demand. The external sector is expected to remain strong.
Growth is expected to remain favourable in 2018, with domestic demand continuing to be the key driver of
growth. The expected faster expansion in global growth would continue to benefit Malaysia’s exports, with
positive spillovers to the domestic economic activity. Headline inflation is expected to moderate in 2018,
reflecting a smaller contribution from global cost factors and a stronger ringgit compared to 2017. Upward
pressures from the robust demand condition will be contained by continued spare capacity in the labour
market and on-going investment for capacity expansion. The trajectory for headline inflation, however, will
remain dependent on the trend of global oil prices, which remains highly uncertain.
The outlook for the noodle manufacturing industry in Malaysia looks positive, and is expected to register a
steady growth throughout the forecast period from 2018 to 2022. The total gross output value of the
noodles manufacturing industry in Malaysia is estimated at RM1.41 billion in 2017. The noodles
manufacturing industry in Malaysia is expected to grow at a compounded annual growth rate of 6.5% for
the period 2018 to 2022.
With a business-friendly environment, the industry is poised to exceed expectations and to continue its
exponential growth.
Appreciation
On behalf of the Board, I wish to express our sincere appreciation to our valued shareholders, customers,
suppliers, bankers, government agencies and other stakeholders for your continued support,
cooperation,trust and confidence in the Group. We will continue to strive hard and uphold your trust in us.
I also wish to convey my gratitude to my fellow directors for their advice and unfailing support, to the
management and staff for their dedication and commitment to steer EKA forward.
Y. Bhg. Tan Sri Dato’ Seri Tan King Tai @ Tan Khoon Hai
Chairman
This Statement contains the management discussion and analysis (“MD&A”) of the business
operations and performance (including financial performance) of EKA Noodles Berhad (“EKA”) Group
for the financial year ended 31 December 2017 (“FY 2017”).
This MD&A should be read in conjunction with the Audited Financial Statements of the Group for FY
2017 as set out in this Annual Report.
This MD&A contains forward-looking statements that reflect our current views in respect to future
events. Our actual results may differ from those anticipated in these forward-looking statements as the
results of risks and uncertainties.
FY 2017 had been a very challenging year for the Group. Following the announcement on 30 August
2016 that the Company is an affected listed issuer under Paragraph 8.04 and Paragraph 2.1(a) of
PN17 of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the Company
announced its cessation of business operations in January 2017.
Amidst the challenges of a very difficult operating environment, the Company resumed its operation in
May 2017.
Net profit / (Loss) after tax 688 (37,032) (14,909) (34,106) (5,166)
(RM’000)
Highlights of the Group’s Financial Information for Past 5 Financial Years (Cont’d)
Net assets per share (RM) 0.19 0.06 0.04 (0.07) (0.09)
Review of Financial Results and Financial Condition Indicators to Measure the Group’s
Performance
FY 2017 FY 2016
RM’000 RM’000
Revenue 13,154 23,910
Gross Loss (876) (8,190)
Loss Before Tax (LBT) (5,007) (34,439)
For FY 2017, the Group registered revenue of RM 13.15 million, a decrease by RM 10.76 million or
45% as compared to RM 23.91 million in the preceding financial year (FY 2016). The revenue for FY
2017 was derived from the resumption of operations of the 3 subsidiaries in May 2017 and August
2017 respectively.
Despite lower revenue, the Group recorded a lower gross loss of RM 0.88 million in FY 2017, RM 7.31
million or 89.30% lower as compared to RM 8.19 million in FY 2016. The improvements in the gross
loss position were mainly due to lower fixed operating cost e.g. staff costs due to fewer manpower and
depreciation charges.
In FY 2017, the Group registered a decrease in LBT of RM 5.01 million as compared to a LBT of RM
34.44 million in FY 2016. The said decrease was the result of lower administrative expenses by
71.22% to RM 6.65 million versus RM 23.11 million in FY 2016 and other income of RM 6.23 million
mainly derived from insurance claims of RM 0.77 million, gain on deconsolidated of a subsidiary which
was wound up by Court of RM 2.02 million and the reversal of impairment loss on trade and other
receivables.
Significant Changes in Financial Position and Liquidity as Compared with the Previous
Financial Year
31.12.2017 31.12.2016
RM’000 RM’000
Total assets 55,638 59,171
Total liabilities 82,410 80,777
Net current (liabilities) / assets (77,126) (21,606)
Current ratio (times) 0.06 0.73
Total borrowings 69,928 69,135
Net cash from operating activities 2,028 284
The total assets as at 31 December 2017 reduced by 5.97% to RM 55.64 million as compared to RM
59.17 million as at last financial year end mainly due to annual depreciation charges on property, plant
and equipment and wound up of a subsidiary by court order on 27 September 2017.
The total liabilities as at 31 December 2017 increased by RM 1.63 million to RM 82.41 million, 2.02%
higher than the total liabilities as at 31 December 2016 mainly due to increase in trade and other
payables and provision for taxation.
There was an increase in borrowings by RM 0.79 million to RM 69.93 million as at 31 December 2017
as compared to RM 69.14 million as at last financial year end mainly due to interests charges by the
banks in the financial year.
The Group’s business generated a net cash inflow from operating activities of RM 2.03 million for FY
2017 as compared to RM 0.28 million in FY 2016. The increase of RM 1.75 million was mainly due to
lower LBT and positive sign of operating profit before working capital changes.
31.12.2017 31.12.2016
RM’000 RM’000
Property, Plant & Equipment 50,656 57,991
Shareholders’ equity (26,772) (21,606)
Total borrowings 69,928 69,135
Net debt 61,800 69,514
Gearing ratio (2.61) (3.20)
Debt- to - Equity ratio (2.82) (2.60)
Earnings / (Loss) per share (Cents) (2.61) (3.20)
Net assets per share (RM) (0.09) (0.07)
Net cash from investing activities 987 1,008
Net cash from / (used in ) financing activities (3,112) (1,689)
Dividend per share - -
The capital expenditure in respect of property, plant and equipment (PPE) as at 31 December 2017
reduced by RM 7.34 million, or 12.65% to RM 50.66 million as compared to RM 57.99 million as at 31
December 2016 due to depreciation, PPE written off and disposal of PPE.
The gearing ratio of the Group for FY 2017 was (2.61) as compared to (3.20) in FY 2016 and the debt-
to-equity ratio of the Group for FY 2017 was (2.82) as compared to (2.60) in FY 2016.
Net cash from investing activities for FY 2017 was RM 0.99 million, RM 0.02 million lower than
RM1.01 million in FY 2016. Net cash used in financing activities increased to RM 3.11 million in FY
2017 as compared to RM 1.69 million in FY 2016 mainly due to increase in repayment of term loan to
financial institution during FY 2017.
31.12.2017 31.12.2016
RM’000 RM’000
Revenue
- West Malaysia 11,270 23,910
- East Malaysia 1,884 -
Total 13,154 23,910
Basically EKA had divided its business segments into West Malaysia and East Malaysia.
For FY 2017, revenue in West Malaysia decreased by RM 12.64 million or 52.86% to RM 11.27 million
as compared to RM 23.91 million in FY 2016. The revenue in West Malaysia was solely derived from
two subsidiaries which only resumed their operations in middle of FY 2017 after the Group temporarily
ceased operations in January 2017. For East Malaysia, the revenue was RM 1.88 million in FY 2017,
represented 100% increment as compared to FY 2016 mainly attributed from the resumption of
operation of one subsidiary in East Malaysia during FY 2017.
West Malaysia had suffered loss before tax of RM 4.90 million for FY 2017 as compared to loss before
tax of RM 27.40 million in FY 2016, significantly lower by 82.12% or RM 22.50 million. East Malaysia
also suffered a loss of RM0.10 million in FY 2017 as compared to loss before tax of RM 7.04 million in
FY 2016, significantly reduced by RM 6.94 million or 98.58%. Overall, the Group achieved
encouraging improvements as loss before tax had reduced by 85.46% versus preceding financial year.
Business Risks
Generally the Group’s raw materials are broken rice/rice chips, tapioca starch, corn starch, potato
starch and sago starch which are readily available in Malaysia. In view of the Company’s financial
condition, the Group was exposed to shortage of supply of raw materials during the financial year. In
mitigation, the Group had adopted zero inventory system as well as improving its working relationships
with a few suppliers for longer credit terms and on-time payment.
Forward-looking Statement
In view of the positive outlook of the noodle manufacturing industry, we expect our core businesses
and our establishment in the industry over a decade would represent a positive growth momentum.
We cautiously optimistic for the future and expect the Group to perform satisfactorily in next financial
year despite the challenging environment.
Y. Bhg. TAN SRI DATO’ SERI TAN KING TAI @ TAN KHOON HAI
Y. Bhg. TAN SRI DATO’
Non-Independent SERI TAN KING
and Non-Executive TAI @aged
Chairman, TAN62,
KHOON HAI
Male, Malaysian
Non-Independent and Non-Executive Chairman, aged 62, Male, Malaysian
Y. Bhg. TAN SRI DATO’ SERI TAN KING TAI @ TAN KHOON HAI was appointed as the Non-Independent and
Y. Bhg. TAN SRI
Non-Executive DATO’ SERI
Chairman on 08TAN
May KING
2017. TAI @ TAN KHOON HAI was appointed as the Non-Independent and
Non-Executive Chairman on 08 May 2017.
Y. Bhg. Tan Sri graduated from Bolton University in Business Management majoring in Accounting. He is a
Y. Bhg. Tan
member Sri graduated
of The Institute of from Bolton
Certified University
Public in Business
Accountants, Management
Ireland majoring
and is currently in Accounting.
a Council MemberHeof isthe
a
member
MalaysianofAssociation
The Institute of CertifiedSecretaries.
of Companies Public Accountants, Ireland and is currently a Council Member of the
Malaysian Association of Companies Secretaries.
He has over 35 years of working experience in the fields of auditing, accounting and corporate finance. He was
He
the has over 35
Executive years of
Director working experience
of Pensonic in the fields
Holdings Berhad of auditing, 1995
from September accounting and corporate
to October 2017. finance. He was
the Executive Director of Pensonic Holdings Berhad from September 1995 to October 2017.
Y. Bhg. Tan Sri also holds directorships in the following public companies listed on Bursa Malaysia Securities
Y. Bhg. Tan
Berhad:- Sri alsoIndependent
(a) Senior holds directorships in the following
Non-Executive Director ofpublic companies
Unimech listed on(appointed
Group Berhad Bursa Malaysia Securities
on 6 March 2000
Berhad:-
and was resigned on 5 July 2016); (b) Executive Director/Finance Director of Muar Ban Lee Group Berhad 2000
(a) Senior Independent Non-Executive Director of Unimech Group Berhad (appointed on 6 March (with
and
effectwas resigned
from 30 Juneon 2009);
5 July 2016);
and (c)(b) Executive
Executive Director/Finance
Director of SWS Director
Capital of Muar Ban
Berhad on 30LeeNovember
Group Berhad
2003 (with
and
effect from
resigned on3026June 2009);
October andHe
2010. (c)was
Executive Directorappointed
subsequently of SWS Capital
as the Berhad
Deputy on 30 November
Executive 2003
Chairman onand
23
resigned
Decemberon2015 26 and
October 2010. Heaswas
redesignated subsequently
Executive Chairman appointed as the Deputy
on 16 November Executive
2016. He also sitsChairman on 23
on the board of
December 2015limited
several private and redesignated
companies. as Executive Chairman on 16 November 2016. He also sits on the board of
several private limited companies.
A total of 5 Board meetings held during the financial year ended 31 December 2017. He had attended all the
A totalmeetings
Board of 5 Board meetings
held after hisheld during the
appointment financial
in May 2017.year ended 31 December 2017. He had attended all the
Board meetings held after his appointment in May 2017.
He is the father-in-law of Fong Yit Meng, the Executive Director of the Company. He does not have any conflict
He is the father-in-law
of interests of Fong
in any business Yit Meng, involving
arrangement the Executive Director of
the Company northe Company.
any He for
convictions does not have
offences anythe
within conflict
past
of interests in any business arrangement
5 years other than traffic offences, if any. involving the Company nor any convictions for offences within the past
5 years other than traffic offences, if any.
CHAN
CHAN SOO SOO YEENYEEN was appointed as the Group General Manager on 25 April 2017.
Group General Manager, aged 43, Female, Malaysian
She obtained a certificate in Book-Keeping and Accounting accredited to LCCI & Pitman Examinations Institute
CHAN
of LondonSOOinYEEN was aappointed
2002 and certificateasinthe GroupProducts
Marine GeneralCultivation
Manager on 25 April
from Chung 2017.
Hwa Correspondence School in
April 2002.
She obtained a certificate in Book-Keeping and Accounting accredited to LCCI & Pitman Examinations Institute
of London
She has overin 2002 and aofcertificate
20 years in Marine Products
working experience Cultivation
in accounting from Chung
and finance. Hwashe
In 1994, Correspondence School
started her career as in
a
April 2002.
bank teller in MBF Finance Berhad. Subsequently, she joined Heap Seong Chan Co Sdn Bhd as an Accounts
Executive in 1997. She then joined Kilang Bihun Bersatu Sdn Bhd (KBBSB) as an Accounts Executive in 2002
She her
and has last
overposition
20 yearsinofKBBSB
workingwas experience in accounting
an Internal and finance.
Auditors. During her 9 In 1994,
years she started
tenure her career
with KBBSB, she aswas a
bank teller in MBF Finance Berhad. Subsequently, she joined Heap Seong Chan Co Sdn
responsible for the management, administrative functions as well as credit control of KBBSB. From 2011 to Bhd as an Accounts
Executive
2015, she inwas1997.
withShe then joined
Chemlite KilangSdn
Industries Bihun
BhdBersatu Sdn Bhd
as a Senior (KBBSB)
Accounts as an Accounts
Executive. She alsoExecutive
involves in
in 2002
GST
and her last
consulting andposition in KBBSB
has played a pivotalwas
rolean Internal aspect
in various Auditors. During
of the her 9 years tenure with KBBSB, she was
management.
responsible for the management, administrative functions as well as credit control of KBBSB. From 2011 to
2015,isshe
She was with
currently ChemliteallIndustries
overseeing corporate,Sdn Bhd as a Senior
administrative Accounts Executive.
and procurement functions She also
of the EKAinvolves
Groupinand
GST a
consulting and has played a pivotal role in various aspect of the management.
Board member of the EKA Group. She does not have any directorships in public companies or public listed
companies.
She is currently overseeing all corporate, administrative and procurement functions of the EKA Group and a
Board
Ms. Chanmember
does ofnotthe EKA
have anyGroup.
family She does notwith
relationship have
anyany directorships
director in public
and/or major companies
shareholder or Company
of the public listed
or
companies.
any conflict of interests in any business arrangement involving the Company. She has no convictions for
offences within the past 5 years other than traffic offences, if any.
Ms. Chan does not have any family relationship with any director and/or major shareholder of the Company or
any conflict of interests in any business arrangement involving the Company. She has no convictions for
offences
CHAN withinCHIN
YONG the past 5 years other than traffic offences, if any.
Group Accountant, aged 40, Male, Malaysian.
CHAN YONG
CHAN YONG CHIN
CHIN was appointed the Group Accountant on 14 July 2017.
Group Accountant, aged 40, Male, Malaysian.
He is graduated with a Degree in Accounting from University Science of Malaysia and is a member of Malaysian
CHAN
InstituteYONG CHIN was
of Accountant appointed the Group Accountant on 14 July 2017.
(MIA).
He
He is
hasgraduated
over 15 with
yearsa of
Degree in Accounting
working experiencefrom University
where he startedScience of Malaysia
his career as an and
auditisassistant
a member in of Malaysian
Wong Liu &
Institute of Accountant (MIA).
Partner in March 2002. Subsequently, he joined KPMG Tax Services Sdn Bhd as associate tax consultant in
October 2002. He was then promoted to senior tax consultant in KPMG Tax Services Sdn Bhd before he joined
He has Tax
JB Lau overServices
15 yearsSdn
of working
Bhd as aexperience whereinhe
Tax Supervisor started
2007. his career as
Subsequently, he an audit assistant
spanned his careerintoWong Liu &
Singapore
Partner in March 2002. Subsequently, he joined KPMG Tax Services Sdn Bhd as associate
and was attached with Stephen McLaren Consultants Pte Ltd as an Assistant Tax Supervisor in 2008. In 2009, tax consultant in
October
he joined2002.
CK &He was thenas
Associates promoted to senior
an Operations tax consultant
Manager, fully in in KPMGofTax
charge the Services Sdn
operational Bhd before
activities hefirm.
of the joined
In
JB LauheTax
2010, Services
started Sdn business
his own Bhd as a inTax Supervisor
healthcare in 2007.
products Subsequently,
and subsequentlyheinto
spanned
bio-fuelhisadditive
career business.
to Singapore He
and was
was attached
a joint with
venture Stephen
partner McLaren
of Yingdi Consultants
Innovation Pte Ltd as
Technology an Assistant
(Shenzhen) Co.Tax
Ltd,Supervisor
China forinbio-fuel
2008. In 2009,
additive
he joined CK &and
manufacturing Associates
marketingasinan Operations
China, Manager,
especially fully in charge
in Guangdong of the
and Hubei operational
province, activities of the firm. In
China.
2010, he started his own business in healthcare products and subsequently into bio-fuel additive business. He
was
He isa responsible
joint venture for
partner of Yingdiand
the finance Innovation Technology
accounting functions(Shenzhen)
of the EKA Co.Group.
Ltd, China
He doesfor bio-fuel
not have additive
any
manufacturing and marketing in China, especially in
directorships in public companies or public listed companies.Guangdong and Hubei province, China.
He is responsible
Mr. Chan for the
does not have anyfinance and accounting
family relationship functions
with any directorofand/or
the EKA
majorGroup. He does
shareholder not
of the have any
Company or
directorships
any conflict ofininterests
public companies or public
in any business listed companies.
arrangement involving the Company. He has no convictions for offences
within the past 5 years other than traffic offences, if any.
Mr. Chan does not have any family relationship with any director and/or major shareholder of the Company or
any conflict of interests in any business arrangement involving the Company. He has no convictions for offences
within the past 5 years other than traffic offences, if any.
TEOH MOAY YANG was appointed as the Production Manager on 1 June 2017.
She has spent most of her career in the manufacturing industry and is one of the pioneer executives of the
Company. After completing her education at Sekolah Menengah Padang Serai, she joined General Electric
(Audio) Malaysia Sdn Bhd as a Production Assistant Line Leader in 1985 and a year later, she joined Franklin
Porcelain Sdn Bhd as a Production Supervisor. She was a Production Manager of Asia Porcelain Sdn Bhd
(Selangor) Sdn Bhd in 1990 and subsequently joint EKA Group in 2001.
She has more than 20 years of experience in the manufacturing industry and is primarily responsible for
production management and maintaining strict Food Safety & Quality Consultant (FSQC) of the EKA’s Group
manufacturing operation. She does not have any directorships in public companies or public listed companies.
Ms. Teoh does not have any family relationship with any director and/or major shareholder of the Company or
any conflict of interests in any business arrangement involving the Company. She has no convictions for
offences within the past 5 years other than traffic offences, if any.
This Corporate Governance Overview Statement is prepared in accordance with the Main Market Listing
Requirements of Bursa Malaysia Securities Berhad (Bursa Securities) and the Malaysian Code of
Corporate Governance (MCCG) issued by the Securities Commission Malaysia.
This statement gives the shareholders an overview of the corporate governance (CG) practices of the
Company during the financial year ended 31 December 2017 (FY2017) and it is to be read together with
the Corporate Governance Report which is available at the Company’s website (www.ekanoodles.com)
Board Responsibilities
The Board is mindful of its responsibilities to the shareholders and stakeholders of the Company for
creating sustainable value through leadership and implementation of policies which ensure the Group’s
objectives and performance are met.
The Board delegates certain areas of its responsibilities to the Board Committees, each with predefined
terms of reference and responsibilities and the Board receives reports of their proceedings and
deliberations. Where the Board Committees have no authority to make decisions on matters reserved for
the Board, recommendations would be tabled to the Board for its approval. The Chairman of the
respective Board Committees shall report the outcome of the Committee meetings to the Board and
relevant decisions are incorporated in the minutes of the Board meetings.
The Board, in its stewardship role delegates authority and vests accountability in respect of the Group’s
day to day operations with the management team led by the Executive Director.
Below is the Group’s Governance Model where specific powers of the Board are delegated to ensure
responsibilities and duties are discharged orderly:
BOARD OF DIRECTORS
CHAIRMAN
INDEPENDENT DIRECTORS EXECUTIVE DIRECTOR
- Audit & Risk Management Committee - Executive Management
- Nominating Committee
- Remuneration Committee
The Board is supported by 3 qualified company secretaries and has unrestricted access to the services of
the Company Secretaries on matters relating to the companies law, rules and regulations of the regulatory
authorities as well as best practices on governance.
Board Composition
The overview of the Board composition, balance and diversity as at 31 December 2017 is as follows:
The profile of each director is set out in the Directors’ Profile section of this Annual Report.
In accordance with the Company’s Constitution, 1/3 of the directors for the time being, or, if their number
is not 3 or a multiple of 3, then the number nearest to 1/3 shall retire from office and be eligible for re-
election. Provided always that, all directors shall retire from office once at least in each 3 years but shall
be eligible for re-election. A retiring director shall retain office until the close of the meeting at which he
retires.
The Board through its Nominating Committee conducts annual assessments of the effectiveness of the
Board, the Board Committees, individual directors and senior management of the Company.
The Nominating Committee, upon its recent annual assessment carried out, is satisfied that the current
size and composition of Board, Board Committees, its directors and senior management are adequately
appropriate for its purpose with relevant mix of skills, experience, competency, ethnicity and age.
The assessment of the Board and Board Committees are carried out by way of questionnaires to be
completed by the Nominating Committee in regard to mix of skills, knowledge, competency, proceeding of
meetings, experiences, timely reporting and so forth. The assessments of individual directors,
independent directors and senior management are carried out by way of self-assessment questionnaires.
The self-assessment questionnaires include amongst others the character, integrity, contributions in
meetings, quality of input, understanding of role, time commitment and so forth.
The responses to the questionnaires are then sent to the Nominating Committee for evaluations. The
Nominating Committee will deliberate based on their ratings and makes its recommendations to the Board.
During FY 2017, the Nominating Committee had carried out the following activities:
Remuneration
The Board has in place a Remuneration Policy which is fair and transparent to ensure a competitive
remuneration are in place to motivate, reward and retain calibre directors and senior management of the
Group. During the financial year, the Remuneration Committee had reviewed and recommended the
remuneration package of the executive director to the Board and the executive director’s concerned had
abstained from deliberation and voting in respect of his remuneration package.
The Remuneration Committee had also reviewed the remuneration to be paid to non-executive directors
based on their level of responsibilities, time commitment required. However, the Board as a whole
determines the remuneration of the non-executive directors, and the individual director concerned had
abstained from deliberation on his own remuneration. The directors’ fees and benefits determined by the
Board are subject to shareholders’ approval at the AGM.
Remuneration (Cont’d)
N1 – Received on Company Level
N2 – Received on Group Level
N3 – Other emoluments comprising of performance incentives, allowances and statutory contributions to
regulatory bodies
N4 – No directors’ benefits were paid during the FY 2017
PRINCIPLE B – EFFECTIVE AUDIT AND RISK MANAGEMENT
For FY 2017, the Audit & Risk Management Committee had held 5 meetings and the summary of their
activities including the internal audit functions are set out in the Audit & Risk Management Committee
Report section of this Annual Report.
Risk Management and Internal Control Framework
The Board acknowledges its responsibility for establishing a sound framework to manage risks and
maintaining a sound system of internal control to safeguard the shareholders’ investment and the Group’s
assets.
The Board had established a risk management framework to manage risks affecting its business and
operations.
During FY 2017, the Board had received assurance from the executive director that the Group’s risk
management and internal control is operating adequately.
An overview of risk management and the state of internal control within the Group is set out in the
Statement on Risk Management and Internal Control section of this Annual Report.
PRINCIPLE C – INTEGRITY IN CORPORATE REPORTING AND MEANINGFUL RELATIONSHIP
WITH STAKEHOLDERS
The Board has in placed a Corporate Disclosure Policy to ensure accurate and timely disclosures to the
regulatory authorities, shareholders and stakeholders of the Company. This policy sets out the
procedures for the Group to observe including but not limited to disclosures of information that conforms
with the rules and regulations of Bursa Securities, press releases, updating the information published on
the Company’s websites and so forth.
The Non-Independent Non-Executive Chairman or failing him, the Executive Director is assigned with the
responsibility in ensuring the accuracy of the contents released to the regulatory authorities and/or the
public.
The Board encourages the participation of shareholders and investors, both individual and institutional, at
general meetings and welcomes briefings from press and investment analysts.
The Company’s AGM is a vital forum for interactions with shareholders. The Annual Report of the
Company together
EKA NOODLES with (583565-U)
BERHAD the notice of AGM is sent to shareholders at least 28 days before the date of the
24 ANNUAL
AGM. REPORT 2017
Each item of special business included in the notice of AGM will be accompanied by explanatory
CORPORATE GOVERNANCE
OVERVIEW STATEMENT (Cont’d)
The Corporate Disclosure Policy is available at the Company’s website at (www.ekanoodles.com)
Conduct of General Meetings
The Board encourages the participation of shareholders and investors, both individual and institutional, at
general meetings and welcomes briefings from press and investment analysts.
The Company’s AGM is a vital forum for interactions with shareholders. The Annual Report of the
Company together with the notice of AGM is sent to shareholders at least 28 days before the date of the
AGM.
Each item of special business included in the notice of AGM will be accompanied by explanatory
statement to facilitate a full understanding and evaluation of the proposed resolution.
The Company’s Chairman will invite shareholders’ to raise questions pertaining to each proposed
resolution before putting the motion to vote by poll. Board members and senior management will be
present to respond to any questions raised from the shareholders. The Company’s external auditors are
also present to address issues relating to the audits and the auditors’ reports. Before the commencement
of poll voting, the Company Secretary will share with shareholders the poll voting process on all
resolutions put to the meeting.
Shareholders are encouraged to ask questions on any proposed resolutions and/or to clarify issues that
they may have at the forthcoming 15th AGM of the Company to be held at Lot 208, Phase II, Kuala Ketil
Industrial Estate, 09300 Kuala Ketil, Kedah Darul Aman on Tuesday, 22 May 2018 at 11.00 am.
This Corporate Governance Overview Statement was approved by the Board on 22 March 2018.
Composition
Chairman : Leong Woay Hong @ Neoh Woay Hong - Independent Non-Executive Director
Members : Dato’ Dr. Chin Yew Sin (JP) - Independent Non-Executive Director
Lim Choo Hooi - Independent Non-Executive Director
Terms of Reference
The terms of reference of the Audit & Risk Management Committee is available at the Company’s website
(www.ekanoodles.com)
Summary of Activities
The Audit & Risk Management Committee met 5 times during the financial year ended 31 December 2017
(FY 2017) and details of attendance are as follows:-
The summarized activities carried out by the Audit & Risk Management Committee during FY 2017 are as
follows:-
Financial Reporting
o Reviewed the quarterly and annual financial statements of the Company and of the Group with the
executive director and management, focusing particularly on appropriate accounting policies
adopted by the management, any adjustments arising from the audits, prudent judgements and
reasonable estimates made by the management are in accordance with the financial reporting
standards and other legal requirements to ensure that the financial statements presented a true and
fair view of the Group’s financial performance before recommending them to the Board for approval.
External Audit
o Reviewed with the external auditors, the audit review memorandum arising from audits of the
Company and its subsidiaries together with comments and responses of the management
including the assistance given by the management and employees of the Group.
o Assessed the independence, resources and the overall performance of the external auditors and
upon assessment, recommended them to the Board for re-appointment.
o Held private sessions with the external auditors without the presence of the executive director or
the management of the Company to reinforce the independence of the external audit function of
the Company.
o Held private sessions with the external auditors without the presence of the executive director or
the management of the Company to enquire about any extraordinary matters or material concerns
related to the Group which required immediate attention of the Audit & Risk Management
Committee.
o Reviewed with the internal auditors, the internal audit plan to ensure adequate coverage of key
functional areas and business activities of the Group.
o Reviewed with the internal auditors, the internal audit reports to ensure appropriate corrective
actions had been taken by the management to implement the audit recommendations.
o Reviewed and report to the Board on the adequacy of the scope, function and effectiveness of the
Company’s internal audit function.
o Reviewed and report to the Board on the risks profile including the management action plans in
mitigating the principal risks identified.
o Assessed and report to the Board on the resources, competencies and the overall performance of
the internal auditors.
o Reviewed the report by the management in respect of recurrent related party transactions of the
Group to ensure all related party transactions were undertaken on an arm’s length basis and on
normal commercial terms, consistent with the Group’s usual business practices and policies,
which are not more favourable to the related parties than those generally available to the public
and are not detrimental to the minority shareholders of the Company. During FY 2017, there were
no related party transactions involving the interest of the directors or major shareholders of the
Company.
Annual Reports
o Reviewed the Statement on Risk Management and Internal Control, Audit & Risk Management
Committee Report and Corporate Governance Disclosures and recommended to the Board for
inclusion in the Company’s Annual Report for the financial year ended 31 December 2016.
The Board recognises that an internal audit function is vital in ensuring the effectiveness of the Group’s
systems of internal control and is an integral part of the risk management process. The Board has
established an internal audit function which is independent of the activities in audits. The Internal Auditors
reports directly to the Audit & Risk Management Committee.
The Audit & Risk Management Committee reviews and approves the internal audit plan and assesses the
adequacy of the internal audit function. The internal auditors will independently review the systems of
internal control of selected auditable or functional areas and present their findings and recommendations
for improvements in the internal audit report to the Audit & Risk Management Committee.
The Audit & Risk Management Committee will use its reasonable efforts to carry out its obligations in
ensuring appropriate actions are being taken for the Group to maintain a sound systems of internal control.
The internal audit function is carried out by the Group internal audit department, to assist the Audit & Risk
Management Committee in discharging its duties and responsibilities. The total cost incurred in managing
the internal audit function for FY 2017 was RM13,476.42.
During FY 2017, the internal auditors had reviewed the systems of internal control on Property, Plant and
Equipment Management covering the areas in maintenance of register, capitalisation and depreciation
policies, identification and maintenance of assets, acquisition, disposal, transfer of assets and
safeguarding of assets.
The internal auditors had also reviewed the risk management framework to ensure their adequacy and
relevance. Additionally, the internal auditors had carried a risk review exercise on the principal risks
identified by the management including the activities to mitigate such risks to ensure adequate and
effective risk management are in place.
The Directors acknowledge that they are responsible for the Annual Audited Financial Statements so
as to give a true and fair view of the state of affairs as at the end of the financial year of the Group and
of the Company and of their results and their cash flows.
In preparing the financial statements for the financial year ended 31 December 2017, the Directors
had:-
The Directors had ensured the Company maintains appropriate accounting policies that disclose with
reasonable accuracy of the financial position of the Group and of the Company, and which enable
them to ensure that the financial statements comply with the Companies Act, 2016.
The Directors had also taken steps that are reasonably available to them to safeguard the assets of
the Group and of the Company, and to prevent and detect fraud, other irregularities and material
misstatements.
This statement was made in accordance with a resolution of the Directors dated 22 March 2018.
The Board is pleased to present the inaugural Sustainability Statement of EKA Noodles Berhad (“EKA” or
“our Company”).
With the introduction of our new corporate strategy, the FY 2017 was in many ways a year of transition for
us. Our vision is to be a leading manufacturer of rice vermicelli in Malaysia whilst our mission is to ensure
high standards of governance across our entire operation to promote responsible business practices,
environmental stewardship, and meet the social needs of the community and nation.
The Board believes that sustainability business practices are fundamental to our growth as well as
strengthening our consumers’ trust and loyalty. The adoption, implementation and development of
sustainable development is a journey thus EKA had adopted a balance approach whilst it strives to
improve and continue to explore constructive learning opportunities for sustainability.
Scope
The Sustainability Statement underpinned EKA’s commitment to undertake its business in a responsible
and sustainable manner through Economic, Environmental and Social (EES).
This Statement reflects the outcome of our Group’s materiality assessment of the most important
sustainability areas.
Governance Structure
As part of our commitment towards sustainability, we established a clear governance structure to ensure
compliance and performance.
BOARD OF DIRECTORS
EXECUTIVE DIRECTOR
SUSTAINABILITY WORKING GROUP
The Board has set up a Sustainability Working Group comprising certain key executives of the Group
from various departments to implement our sustainability policies and guidelines. The Sustainability
Working Group is led by the Executive Director who is tasked to monitor, review, make recommendations
and report to the Board.
Stakeholder Engagement
We recognise that transparency promotes accountability and ensure that matters pertaining to
stakeholders are approached with ethical conducts as well as operational and economic responsibilities.
Stakeholders’ communication methods are regularly assessed, through information requests, to ensure
that they are transparent and effective.
Materiality Assessment
A materiality assessment is conducted by the Company to identify and prioritise the material EES risks
and opportunities.
Upon the identification of the EES factors that are significant to the business and stakeholders, a risk
assessment is then conducted to review the exposures and extent of the impact of the material EES
factors.
- have most significant and material impact on our strategies and business operations; and
- are of importance to our stakeholders and in particular, our customers, employees, shareholders, local
communities, suppliers and regulatory authorities.
Anti-Corruption
At EKA, we operate our business based on the principles of fairness, honesty, transparency, decency,
integrity and ethics, which we believe are crucial to our success. EKA has in place a Whistle Blowing
Policy which sets out a formal communication channel for employees and stakeholders of the Group to
communicate matters of concern in good faith and without fear of reprisal.
The Board had also adopted the Code of Business Conduct which outlines the business conducts and
practices of the Group which is applicable to all directors, employees and any other persons who
represent the Group in executing their duties and functions of the Group.
The Whistle Blowing Policy and Code of Business Conduct are available on our website
(www.ekanoodles.com)
Product Responsibility
As a rice vermicelli manufacturer, it is our priority to produce our products which meet all applicable food
safety standards and are consistently high quality and nutritious as customers confidence in our products
are of paramount importance.
EKA is committed to be the market leader in manufacturing and marketing of all types of rice and sago
sticks (vermicelli) and related food products that emphasises on high quality and food safety, where our
manufactured products conform with statutory requirements and customers specification at the most
competitive cost, highest quality and reliability and prompt service through continual improvements that
exceed customer requirements.
EKA had implemented Safe Quality Management System where we strongly emphasise on quality, safety
and expertise to be in line with Hazard Analysis and Critical Control Point (“HACCP”) practice.
The raw materials used in the manufacturing are carefully selected through stringent quality control. At
every process stage, from manufacturing to packaging and marketing, we ensure well trained, skilled and
qualified staff are assigned to constantly check the product quality and the best are delivered to our
customers.
Besides upholding food safety, we regularly improve the nutritional contents of our products for better
nutritional values and health benefits to customers.
We have established our brand presence since 2002 and a reputation for quality and value-for-money
products. We are the first vermicelli and noodles manufacturers to be awarded HACCP. We are also Halal,
Mesti, ISO 9001:2008 and GMP certified companies.
We strive to ensure our products are widely distributed and to be accessible to consumers in East and
West Malaysia vide general trade channels, traditional media and Internet-of-Things. In effort to promote
affordability, we would provide discounts as well as special bulk price on certain products.
We are committed to minimise our impact on the environment through innovation, efficient use natural
resources and reducing emissions and waste, in order to preserve our eco-system for future generations.
These measures also help to improve efficiencies and cost reductions for our business.
We have own waste treatment plants that adheres to the waste management requirements and our
manufacturing facilities are in full compliance with the Environmental Quality (Clean Air) Regulations 2014.
In FY 2017, the Department of Environment (DOE) Malaysia and the Department of Occupational Safety
and Health (DOSH) Malaysia had inspected and certified that our boilers and chimneys are in compliance
with the governing rules and regulations.
We assigned trained and qualified personnel to closely monitor carbon and water emissions across all our
manufacturing sites. Further to this, we have Emission Management Competency training programs in
place to ensure our teams are fully aware of the requirements that need to be complied with.
We had also undertaken various environment related initiatives such as encouraging our employees to
reduce paper usages and energy savings as well as the culture of recycling waste materials.
Our Employees
Our employees form an integral part of EKA as we believe our people are the key driving force in
achieving the Company’s objectives. We are committed to ensure fairness in careers’ opportunities and
treat all employees equally regardless of their religions, ethnicity, genders, age and nationalities towards a
harmonious working environment, at the same time creating a healthy lifestyle and working cultures.
For FY 2017, our Group had a total of 123 employees, comprising 62 male employees and 61 female
employees. Out of the total employees, 71.54% or 88 employees are Malaysians and the balance of
28.46% or 35 employees are foreign nations.
EMPLOYEES, EMPLOYEES,
FEMALE, 61 MALE, 62
FOREIGNERS, 35
LOCALS, 88
We are committed in maintaining high safety and health standards for our employees and other
stakeholders. To achieve this objective, each operation unit has established a Safety & Health Committee
which is responsible
Occupational Safety for
andcultivating
Health safe working practices and behavior. A series of in-house training
programs on safety and health have also been conducted by committee members and external experts. In
addition, a Hazard Identification
We are committed Riskhigh
in maintaining Assessment andhealth
safety and Controls (“HIRAC”)
standards forsystem and related
our employees facilities
and other
are in place to reduce hazards
stakeholders. To achieve this objective, each operation unit has established a Safety & Health Committee
which is responsible for cultivating safe working practices and behavior. A series of in-house training
Social andonWelfare
programs Contribution
safety and health have also been conducted by committee members and external experts. In
addition, a Hazard Identification Risk Assessment and Controls (“HIRAC”) system and related facilities
As ainresponsible
are corporate
place to reduce citizen, we always believe the way to build a great and enduring company is to
hazards
strike a balance between profitability and fulfilling its social responsibilities. EKA has always encouraged
its management
Social andContribution
and Welfare staff to be involved in welfare work and charity and we are pleased that the spirit is
very much alive within our Group.
As a responsible corporate citizen, we always believe the way to build a great and enduring company is to
1. Canteen
strike Daybetween
a balance 2017 atprofitability
Sekolah Rendah JenisitsKebangsaan
and fulfilling ( C ) Tai Tong,
social responsibilities. Sungai
EKA has Petani,
always Kedah
encouraged
its management and staff to be involved in welfare work and charity and we are pleased that the spiritthe
participated by EKA Group wherein the profit from the sales of “Bihun and Laksa Noodles” during is
veryCanteen Daywithin
much alive was donated to the school.
our Group.
1. Canteen Day 2017 at Sekolah Rendah Jenis Kebangsaan ( C ) Tai Tong, Sungai Petani, Kedah
participated by EKA Group wherein the profit from the sales of “Bihun and Laksa Noodles” during the
Canteen Day was donated to the school.
2. We also extended our care and concern to the under-privileged group as follows:
i. PDK Kuala Ketil, Kedah
ii. Pertubuhan Kebajikan Anak Yatim dan Miskin Nur Hidayah, Baling,
iii. Pertubuhan Kebajikan Rumah Anak-Anak Yatim dan Miskin Al-Taqwa, Baling
iv. Rumah
2. We Bakti Ainul
also extended ourHusna (Pusat
care and Penjagaan
concern Dan Pendidikan group
to the under-privileged Anak-anak Yatim/Miskin)
as follows:
v. Madrasah Tahzi Bunnufus
i. PDK Kuala Ketil, Kedah (Pondok Ustaz Haji Awang Lanai)
vi. Pertubuhan
ii. Rumah AnakKebajikan
Yatim/ Miskin
Anak(Pertubuhan Sinar Nur
Yatim dan Miskin Kasih Darul Aitam).
Hidayah, Baling,
iii. Pertubuhan Kebajikan Rumah Anak-Anak Yatim dan Miskin Al-Taqwa, Baling
iv. Rumah Bakti Ainul Husna (Pusat Penjagaan Dan Pendidikan Anak-anak Yatim/Miskin)
v. Madrasah Tahzi Bunnufus (Pondok Ustaz Haji Awang Lanai)
vi. Rumah Anak Yatim/ Miskin (Pertubuhan Sinar6 Kasih Darul Aitam).
Charity Program at Rumah Bakti Ainul Husna (Pusat Penjagaan Dan Pendidikan
Charity Program Anak-anak
at Madrasah Yatim/Miskin)
Tahzi Bunnufus (Pondok Ustaz
nul Husna (Pusat Penjagaan Dan Pendidikan
Charity Program Anak-anak
at Madrasah 2. (Pondok Ustaz Haji Awang Lanai)
Yatim/Miskin)
Tahzi Bunnufus
2.
Anak-anak Yatim/Miskin) 8
8
Charity Program at Madrasah Tahzi Bunnufus (Pondok Ustaz Haji Awang Lanai)
drasah Tahzi Bunnufus (Pondok Ustaz Haji Awang Lanai)
ang Lanai) 8
8
INTRODUCTION
The Board acknowledges its responsibilities for overseeing the Group’s internal control and risk
management systems and for reviewing their adequacy and effectiveness. This process lends support to
the role of the management of implementing the various policies on risk and control.
Due to limitations that are inherent in any system of internal controls, these systems are designed to
manage rather than eliminate the respective inherent risks that exist in achieving the Group’s business
objectives. Therefore, such systems of internal controls and risk management can only provide
reasonable, and not absolute, assurance against material misstatement or loss.
RISK MANAGEMENT
The Group has an on-going process for identifying, evaluating and managing principal risks. The Risk
Management Processes of the Group are summarized below:-
Risk Identification
To understand and perform analysis on the internal and external potential events that could adversely
impact the achievement of the Group’s objectives and to distinguish between risks and opportunities so
that opportunities are channeled back to the Group’s objectives-setting processes.
Risk Rating
The identified business risks are then evaluated to determine their impact on the Group’s business. This
is defined by risk assessment which involves the assessment of the LIKELIHOOD of occurrence and the
consequential IMPACT of the risk should event takes place.
Risk Treatment
Risk treatment is primarily a decision making process in completing the Risk Register. A variety of risk
management measures are used to manage the identified risks such as ACCEPT risk as it is rated,
AVOID risk from coming into existence, TRANSFER risk to another party or risk sharing and lastly
REDUCE risk with appropriate mitigation plans.
Risk Monitoring
Ongoing risk monitoring is conducted by the management to assess whether any conditions associated
with a particular risk have changed, and to ensure that action and risk mitigation plans have been
implemented. Status of action/mitigation plans are then communicated to the Audit & Risk Management
Committee. The Audit & Risk Management Committee then reported to the Board who assumes the
oversight role in relation to the Group’s risk management and the implementation of the management
actionMonitoring
Risk plans to mitigate the risks identified.
(Cont’d)
During the financial year, the new management had identified the following principal risks:
Business Risk
Compliance Risk
Financial Risk
The Audit & Risk Management had reviewed the risk profiles and was satisfied with the actions taken by
the management in mitigating such risks.
The Company’s internal audit function is performed in-house. The internal audit review is based on the
EKA NOODLES BERHAD (583565-U)
internal audit plan approved by the Audit & Risk Management Committee.ANNUAL
TheREPORT
internal
2017 auditors report
37
directly to the Audit & Risk Management Committee.
During the financial year, the new management had identified the following principal risks:
Business Risk
Compliance Risk
STATEMENT
Financial RiskON RISK MANAGEMENT AND
INTERNAL
The CONTROL
Audit & Risk Management had (Cont’d)
reviewed the risk profiles and was satisfied with the actions taken by
the management in mitigating such risks.
The Company’s internal audit function is performed in-house. The internal audit review is based on the
internal audit plan approved by the Audit & Risk Management Committee. The internal auditors report
directly to the Audit & Risk Management Committee.
The audit plan is developed using a risk based audit approach. A cycling approach to the internal audit
plan is used, whereby high-risk areas are audited on annual basis, and medium-to-low risk areas are
audited over 18 to 24 months cycle.
The focus on internal audit review evolves with changing risk profile, safeguarding of assets, effectiveness
and efficiency of operation, compliance with applicable laws and regulations including adding value to the
Group’s business and to improve business efficiency performance.
Upon completion, the internal audit findings, recommendations and management responses were
presented to the Audit & Risk Management Committee. Follow-up reviews will also be carried out by the
internal auditors to assess the status of implementation of the recommended action plans by the
management. The Audit & Risk Management Committee then reports on the Group’s internal control
systems to the Board.
Organisational chart of the Group with defined roles and responsibilities, levels of authority and
lines of accountability of each division.
Standard operating procedures are in place for the Group’s day to day operations to be carried out.
Regular management operation meetings to monitor the effectiveness of the Group’s systems of
internal control and to take actions where necessary.
The Code of Business Conducts for the directors and employees to uphold the Group’s corporate
cultures, values, conducts and practices.
The Whistle Blowing Policy for employees and stakeholders to communicate matters of concern in
good faith and without fear of reprisal.
The internal audit function provides assurance on the effectiveness of the system of internal
control within the Group.
The Audit & Risk Management Committee reviews the internal audit reports and follow-up findings
reported in previous quarters and subsequently, reports to the Board on the progress of the
internal audit function.
BOARD ASSESSMENT
The Board had received assurance from the executive director that the Group’s risk management and
internal control system is operating adequately as there were no material losses incurred based on the
risk management and internal control systems of the Group.
The Board is of the opinion that the risk management and systems of internal control are ongoing
processes. The identification, monitoring, review and reporting arrangements in place provide reasonable
assurance that the structure of controls and its operations are appropriate to the Group’s businesses.
The external auditors had reviewed this statement in accordance to Paragraph 15.23 of the Main Market
Listing Requirements of Bursa Malaysia Securities Berhad.
The review was performed in accordance with Recommended Practice Guide (RPG) 5 (Revised 2015)
issued by the Malaysian Institute of Accountants. RPG 5 (Revised 2015) does not require the external
auditors to form an opinion on the adequacy and effectiveness of the risk management and internal
EKA NOODLES BERHAD (583565-U)
control systems
38 ANNUAL of the Group.
REPORT 2017
This Statement is issued in accordance with a resolution of the Board dated 22 March 2018.
The Board had received assurance from the executive director that the Group’s risk management and
internal control system is operating adequately as there were no material losses incurred based on the
risk management and internal control systems of the Group.
STATEMENT ON RISK MANAGEMENT AND
The Board is of the opinion that the risk management and systems of internal control are ongoing
INTERNAL CONTROL
processes. The identification, (Cont’d)
monitoring, review and reporting arrangements in place provide reasonable
assurance that the structure of controls and its operations are appropriate to the Group’s businesses.
The external auditors had reviewed this statement in accordance to Paragraph 15.23 of the Main Market
Listing Requirements of Bursa Malaysia Securities Berhad.
The review was performed in accordance with Recommended Practice Guide (RPG) 5 (Revised 2015)
issued by the Malaysian Institute of Accountants. RPG 5 (Revised 2015) does not require the external
auditors to form an opinion on the adequacy and effectiveness of the risk management and internal
control systems of the Group.
This Statement is issued in accordance with a resolution of the Board dated 22 March 2018.
UTILISATION OF PROCEEDS
During FY 2017, there were no proceeds raised by the Company from any corporate proposals.
The amount of audit fees and non-audit fees paid or payable to the external auditors or a firm or
corporation affiliated to the audit firm by the Company and the Group for FY 2017 are follows:-
Group Company
(RM) (RM)
Fees paid / payable to the external auditors
Audit Fees 142,500 42,000
Non-Audit Fees - -
142,500 42,000
MATERIAL CONTRACTS
There were no material contracts with the Company and its subsidiaries involving directors and major
shareholders, either still subsisting at the end of the financial year or entered into since the date of the
previous financial year end.
There were no recurrent related party transactions of revenue or trading nature conducted pursuant to the
shareholders’ mandate during FY 2017.
DIRECTORS’ TRAININGS
All the directors were appointed during FY 2017 and accordingly, they had attended the Mandatory
Accreditation Programme (MAP) prescribed by Bursa Securities. In addition to the MAP, Board members
are encouraged to attend structured training and other conferences or events to keep abreast with the
latest developments of the changes in laws or regulatory and the business environment.
Description of Trainings
Y. Bhg. Tan Sri Dato’ Seri Tan King Tai CSP Practical Issues Under The Companies
@ Tan Khoon Hai Act 2016
LHDNM –MEF Seminar 2017 – Taxation and
Employers
2 Days Workshop on Companies Act 2016
Malaysian Company Secretaries Conference
2017
Mandatory Accreditation Programme (MAP)
Dato’ Dr. Chin Yew Sin (JP) 9th World Chinese Economic Summit
Mandatory Accreditation Programme (MAP)
DIRECTORS’ REPORT
The Directors hereby submit their report together with the audited financial statements of the
Group and of the Company for the financial year ended 31 December 2017.
PRINCIPAL ACTIVITY
The Company is principally engaged in the business of investment holding. The principal
activities of the subsidiaries are set out in Note 9 to the financial statements.
There have been no significant changes in the nature of these activities during the financial
year. Since January 2017, all of the Company subsidiaries temporarily ceased operation.
However, 3 of the subsidiaries continued its operation in May and August during the year.
FINANCIAL RESULTS
Group Company
RM RM
Attributable to:
Owners to the company 5,165,493 13,775,328
DIVIDENDS
There were no dividends proposed, declared or paid by the Company since the end of the
previous financial year. The directors also do not recommend any final dividend in respect of the
current financial year.
All material transfers to or from reserves or provisions during the financial year are disclosed in
the financial statements.
The Company did not issue any shares and debentures during the year.
WARRANTS
The salient terms of the warrants are disclosed in Note 18 to the financial statements.
During the financial year, no options were granted by the Company to any person to take up
any unissued shares in the Company.
Before the financial statements of the Group and of the Company were made out, the Directors
took reasonable steps to ascertain that action had been taken in relation to the writing off the
bad debts and the making of allowance for impairment losses on receivables, and satisfied
themselves that all known bad debts had been written off and that adequate allowance had
been made for impairment losses on receivables.
At the date of this report, the Directors are not aware of any circumstances that would require
the further writing off of bad debts, or the additional allowance for the impairment losses on
receivables in the financial statements of the Group and of the Company.
CURRENT ASSETS
Before the financial statements of the Group and of the Company were made out, the Directors
took reasonable steps to ascertain that any current assets other than debts, which were unlikely
to be realised in the ordinary course of business, including their value as shown in the
accounting records of the Group and of the Company, have been written down to an amount
which there might be expected so to realise.
At the date of this report, the Directors are not aware of any circumstances that would render
the values attributed to the current assets in the financial statements misleading.
VALUATION METHODS
At the date of this report, the Directors are not aware of any circumstances which have arisen
which render adherence to the existing of the valuation of assets or liabilities of the Group and
of the Company misleading or inappropriate.
The contingent liabilities are disclosed in Note 27 to the financial statements. At the date of this
report, there was: -
(a) Charge on the assets of the Group and of the Company that has arisen since the end of
the financial year which secures the liabilities of any other person; or
(b) Contingent liability of the Group and of the Company which has arisen since the end of
the financial year.
No contingent or other liability of the Group and of the Company has become enforceable or is
likely to become enforceable with in the year of twelve months after the end of the financial year
which, in the opinion of the Directors, will or may substantially affect the ability of the Group and
of the Company to meet their obligations when the fall due.
CHANGE OF CIRCUMSTANCES
At the date of this report, the Directors are not aware of any circumstances not otherwise dealt
with in this report or the financial statement of the Group and of the Company which would
render any amount stated in the financial statement misleading.
The results of the operations of the Group and of the Company during the financial year were
not in the opinion of the Directors, substantially affected by any item, transaction or event of a
material and unusual nature.
There has not arisen in the interval between the end of the financial year and the date of this
report any item, transaction or event of a material and unusual nature likely, in the opinion of
the Directors, to affect substantially the results of the operations of the Group and of the
Company for the financial year.
DIRECTORS
DIRECTORS’ INTERESTS
According to the register of the Directors’ shareholdings, the interests of Directors holding office
at the end of the financial year in shares and options over shares of the company and its related
corporations during the financial year are as follows: -
The Directors, by virtue of their interest in shares of the Company, are also deemed to have
interests in shares of the subsidiaries to the extent that the Company has an interest.
Other than as disclosed above and according to the register of directors’ shareholdings, none of
the Directors in office at the end of the financial year hold any interest in shares and options
over ordinary shares in the Company and its related corporations during the financial year.
DIRECTORS’ BENEFITS
During and at the end of the financial year, there is no arrangement subsisted to which the
Company or its related companies is a party with the object or objects of enabling Directors of
the Company to acquire benefits by means of the acquisition of shares in or debentures of the
Company or any other body corporate.
Since the date of the last report, no Director has received or become entitled to receive any
benefit 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.
DIRECTORS’ REMUNERATION
The amounts of the remunerations of the Directors or past Directors of the Group and the
Company comprising remunerations received/receivable from the Group and the Company
during the year are as follows:
Group Company
RM RM
No indemnities have been given or insurance premiums paid, during or since the end of the
year, for any person who is or has been the director, officer or auditor of the Group and of the
Company.
Before the statement of profit or loss and other comprehensive income and statement of
financial position of the Group and of 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 allowance for doubtful debts, and had satisfied themselves that no
known bad debts need to be written off and that adequate allowance had 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 had been written down to their estimated realisable values.
(c) which would render the values attributed to current assets in the financial statements of
the Group and of the Company misleading; or
(d) which have arisen which render adherence to the existing method of valuation of assets
or liabilities of the Group and of the Company misleading or inappropriate; or
(e) not otherwise dealt with in this report or financial statements which would render any
amount stated in the financial statements of the Group and of the Company misleading.
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 year which, in the opinion of the Directors, will
or may substantially affect the ability of the Group and of the Company to meet their obligations
as and when they fall due.
No item, transaction or event of a material and unusual nature has arisen in the interval
between the end of the year and the date of this report which is likely to affect substantially the
results of operations of the Company for the succeeding year.
AUDITORS’ REMUNERATION
The total amounts paid to or receivable by the auditors as remunerations for their services as
auditors are as follows:
Group Company
RM RM
AUDITORS
The auditors, AFRIZAN TARMILI KHAIRUL AZHAR, have expressed their willingness to
continue in office.
TAN SRI DATO’ SERI TAN KING TAI @ TAN KHOON HAI
Director
TAN
KualaSRI DATO’Malaysia
Lumpur, SERI TAN KING TAI @ TAN KHOON HAI
Director
Company No: 583565-U
Date: 22 Mar 2018
Company
EKA No: 583565-U
KualaNOODLES
Lumpur, Malaysia
BERHAD
TAN SRI DATO’
(Incorporated SERI TAN KING TAI @ TAN KHOON HAI
in Malaysia)
EKA NOODLES BERHAD
Director
(Incorporated in Malaysia)
Date: 22 Mar 2018
STATUTORY DECLARATION
STATUTORY
PURSUANT TO SECTION
STATUTORY DECLARATION
Kuala Lumpur,DECLARATION
Malaysia
251 (1)(b) OF THE COMPANIES ACT, 2016
Pursuant to Section
PURSUANT TO SECTION 251 251 (2) of TheOF
(1)(b) Companies Act, 2016
THE COMPANIES ACT, 2016
I, FONG YIT MENG, being the director primarily responsible for the financial management of
EKA NOODLES BERHAD, do solemnly and sincerely declare that the accompanying financial
I, FONG
Date: YIT 2018
22 Mar MENG, being the director primarily responsible for the financial management of
statements, are to the best of my knowledge and belief, correct and I make this solemn
EKA NOODLES BERHAD, do solemnly and sincerely declare that the accompanying financial
declaration conscientiously believing the same to be true, and by virtue of the provisions of the
statements, are to the best of my knowledge and belief, correct and I make this solemn
Statutory Declarations Act, 1960.
declaration conscientiously believing the same to be true, and by virtue of the provisions of the
Statutory Declarations Act, 1960.
Subscribed and solemnly declared by the }
above named at Kuala Lumpur in this }
Subscribed and solemnly declared by the }
Federal Territory on 22 Mar 2018 }
above named at Kuala Lumpur in this }
FONG YIT MENG
Federal Territory on 22 Mar 2018 }
7 FONG YIT MENG
Before me,
7
Before me,
In our opinion, the accompanying financial statements give a true and fair view of the financial
position of the Group and of the Company as at 31 December 2017, and of their financial
performance and their cash flows for the year then ended in accordance with Malaysian
Financial Reporting Standards and the requirements of the Companies Act 2016 in Malaysia.
We conducted our audit in accordance with approved standards on auditing in Malaysia and
International Standards on Auditing. Our responsibilities under those standards are further
described in the Auditors’ Responsibilities for the Audit of the Financial Statements section of
our report. We believe that the audit evidence we have obtained is sufficient and appropriate to
provide a basis for our opinion.
We are independent of the Group and of the Company in accordance with the By-Laws (on
Professional Ethics, Conduct and Practice) of the Malaysian Institute of Accountants (“By-
Laws”) and the International Ethics Standards Board for Accountants’ Code of Ethics for
Professional Accountant (“IESBA Code”), and we have fulfilled our other ethical responsibilities
in accordance with the By-Laws and the IESBA Code.
We draw attention to Note 2 to the financial statements which disclosed the premise upon which
the Group and the Company has prepared its financial statements by applying the going
concern assumption, notwithstanding that the Group and the Company incurred a net loss of
RM5,165,493 and of RM 13,775,328 respectively during the financial year ended 31 December
2017, and as at that date, the Group and the Company’s current liabilities exceeded its current
assets by RM77,125,700 and RM66,588,718 respectively and deficits of shareholders’ funds of
RM26,771,712 and RM59,343,790 respectively, thereby indicating the existence of a material
uncertainty which may cast significant doubt about the Group’s and the Company’s ability to
continue as a going concern. Our opinion is not modified in respect of this matter.
The Group and the Company has been categorised as Practice Note 17 (“PN17”) company and
is required to submit its regularisation plan to the regulatory authorities pursuant to the Listing
Requirements of Bursa Securities Malaysia Berhad (“Bursa Malaysia”). On 14 March 2018,
Bursa Malaysia granted the Company an extension of time of up to 31 May 2018 for the
submission of the proposed Regularisation Plan to Bursa Malaysia. The details of the
regularisation plan are disclosed in Note 31.1 to the financial statements. The ability of the
Group and of the Company to continue as going concerns is dependent upon successful and
timely implementation of the regularisation plan.
Key audit matters are those matters that, in our professional judgement, were of most
significance in our audit of the financial statements of the Group and of the Company for the
current year. These matters were addressed in the context of our audit of the financial
statements of the Group and of the Company as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters. In addition to the matter described
in the Material Uncertainty Related to Going Concern section, we have determined the matters
described below to be the key audit matters to be communicated in our report.
The Group carries significant property, plant and equipment as disclosed in Note 8 to the
financial statements and is subject to impairment assessment. We have focused on the
impairment assessments as the process is complex and its require significant judgements
and estimates of the future results and key assumptions which are based on assumptions
that are affected by expected future market and economic conditions in determining their
recoverable amounts.
Assessing the Group’s calculation of the recoverable amount of property, plant and
equipment assets by comparing to the current market value of all those assets.
Making inquiries of management regarding the action plans to realise the carrying
amount.
Evaluate the adequacy and appropriateness of disclosure of impairment
assessment made in the financial statements.
10
We focused on this area because of the potential significance of the contingent liabilities.
The assessment as to whether or not a liability should be recognised and whether
amounts can be reliably estimated includes, to a certain extent, judgment from
management.
Information Other than the Financial Statement and Auditors’ Report Thereon
The directors of the Company are responsible for the other information. The other information
comprises the Directors’ Report but does not include the financial statements of the Group and
of the Company and our auditors’ report thereon.
Our opinion on the financial statements of the Group and of the Company does not cover the
Directors’ Report and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements of the Group and of the Company, our
responsibility is to read the Directors’ Report and, in doing so, consider whether the Directors’
Report is materially inconsistent with the financial statements of the Group and of the Company
or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If based on the work we have performed, we conclude that there is a material misstatement of
the Directors’ Report, we are required to report that fact. We have nothing to report in this
regard.
11
The directors of the Company are responsible for the preparation of financial statements of the
Group and of the Company that give a true and fair view in accordance with Malaysian Financial
Reporting Standard and the requirements of Companies Act 2016 in Malaysia. The directors are
also responsible for such internal control as the directors determine is necessary to enable the
preparation of financial statements of the Group and of the Company that are free from material
misstatement, whether due to fraud or error.
In preparing the financial statements of the Group and of the Company, the directors are
responsible for assessing the Group’s and the Company’s ability to continue as a going
concern, disclosing, as applicable, matters related to going concern and using the going
concern basis of accounting unless the directors either intend to liquidate the Group or the
Company or to cease operations, or have no realistic alternative but to do so.
i) Identify and assess the risks of material misstatement of the financial statements of the
Group and of the Company, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain audit evidence that is sufficient and
appropriate to provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override
of internal control.
ii) Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Group’s and the Company’s internal
control.
12
iii) Evaluate the appropriateness of accounting policies used and the reasonableness of
accounting estimates and related disclosures made by the directors.
iv) Conclude on the appropriateness of the directors’ use of the going concern basis of
accounting and, based on the audit evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast significant doubt on the Group’s or
the Company’s ability to continue as a going concern. If we conclude that a material
uncertainty exists, we are required to draw attention in our auditors’ report to the related
disclosures in the financial statements of the Group and of the Company or, if such
disclosures are inadequate, to modify our opinion. Our conclusions are based on the
audit evidence obtained up to the date of our auditors’ report. However, future events or
conditions may cause the Group or the Company to cease to continue as a going
concern.
v) Evaluate the overall presentation, structure and content of the financial statements of the
Group and of the Company, including the disclosures, and whether the financial
statements of the Group and of the Company represent the underlying transactions and
events in a manner that achieves fair presentation.
vi) Obtain sufficient appropriate audit evidence regarding the financial information of the
entities or business activities within the Group to express an opinion on the financial
statements of the Group. We are responsible for the direction, supervision and
performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the directors regarding, among other matters, the planned scope and
timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and
other matters that may reasonably be thought to bear on our independence, and where
applicable, related safeguards.
From the matters communicated with the directors, we determine those matters that were of
most significance in the audit of the financial statements of the Group and of the Company for
the current year and are therefore the key audit matters. We describe these matters in our
auditors’ report unless law or regulation precludes public disclosure about the matter or when, in
extremely rare circumstances, we determine that a matter should not be communicated in our
report because the adverse consequences of doing so would reasonably be expected to
outweigh the public interest benefits of such communication.
13
Other Matters
This report is made solely to the members of the Group and of the Company, as a body, in
accordance with Section 266 of the Companies Act 2016 in Malaysia and for no other purpose.
We do not assume responsibility to any other person for the content of this report.
14
Group Company
2017 2016 2017 2016
Note RM RM RM RM
Non Current Assets
Property, plant and equipment 8 50,656,115 - 4,292 -
Investment in subsidiaries 9 - - 7,240,635 -
Other investment 10 1 - 1 -
Intangible assets 11 1 - - -
Total Non Current Assets 50,656,117 - 7,244,928 -
Current Assets
Property, plant and equipment 8 - 57,990,900 - 109,064
Investment in subsidiaries 9 - - - 18,640,637
Other investment 10 - 1 - 1
Intangible assets 11 - 1 - -
Inventories 12 1,701,402 - - -
Trade receivables 13 1,511,403 - - -
Other receivables, deposits
and prepayments 14 1,355,637 609,198 174,990 -
Tax recoverable - 59,451 - -
Cash and bank balances 15 413,754 511,219 12,741 72,880
Total Current Assets 4,982,196 59,170,770 187,731 18,822,582
Equity
Share capital 16 46,800,000 46,800,000 46,800,000 46,800,000
Share premium 17 3,600,000 3,600,000 3,600,000 3,600,000
Reserve 18 14,041,732 14,041,732 4,837,366 4,837,366
Accumulated losses (91,213,444) (86,047,951) (114,581,156) (100,805,828)
Total Equity (26,771,712) (21,606,219) (59,343,790) (45,568,462)
Group Company
2017 2016 2017 2016
Note RM RM RM RM
Non Current Liabilities
Hire purchase payables 19 302,129 - - -
Total Non Current Liabilities 302,129 - - -
Current Liabilities
Hire purchase payables 19 71,869 535,206 - 76,234
Bank borrowings 20 69,554,126 58,662,769 63,832,277 53,400,163
Deferred taxation 21 - - - -
Trade payables 22 8,836,250 8,570,508 - -
Other payables and accruals 23 3,390,168 12,957,363 738,685 10,914,647
Provision for taxation 255,483 51,143 - -
Amount due to subsidiaries - - 2,205,487 -
Total Current Liabilities 82,107,896 80,776,989 66,776,449 64,391,044
Total Liabilities 82,410,025 80,776,989 66,776,449 64,391,044
Total Equity and Liabilities 55,638,313 59,170,770 7,432,659 18,822,582
58
Company No: 583565-U
Attributable to
EKA NOODLES BERHADShare Share Capital Revaluation Warrant Other Accumulated owners of the Total
(Incorporated in Malaysia)
capital premium reserve reserve reserve reserve losses company equity
Group RM RM RM RM RM RM RM RM RM
31 December 2016 46,800,000 3,600,000 4,837,366 9,204,366 6,000,000 (6,000,000) (86,047,951) (21,606,219) (21,606,219)
STATEMENT OF CHANGES IN EQUITY
1 January 2017 46,800,000 3,600,000 4,837,366 9,204,366 6,000,000 (6,000,000) (86,047,951) (21,606,219) (21,606,219)
31 December
1 January 2017
2016 46,800,000 3,600,000
46,800,000 3,600,000 6,000,000
6,000,000 (6,000,000)
(6,000,000) 4,837,366
4,837,366 (114,581,156) 1,750,337
(53,487,029) (59,343,790)
31 December 2016/1 January 2017 46,800,000 3,600,000 6,000,000 (6,000,000) 4,837,366 (100,805,828) (45,568,462)
21
1. GENERAL INFORMATION
The Company is a public company limited by share and is incorporated under the
Companies Act, 1965 in Malaysia. The domicile of the Company is Malaysia.
The registered office of the Company is located at 51-21-A, Menara BHL Bank, Jalan
Sultan Ahmad Shah, 10050 Penang. The principal place of business is located at Lot
208 Phase II, Kuala Ketil Industrial Estate 09300 Kuala Ketil, Kedah Darul Aman.
The Company is principally engaged in the business of investment holding. The principal
activities of the subsidiaries are set out in Note 9 to the financial statement. There have
been no significant changes in the nature of these activities during the financial year.
Since January 2017, all of the Company subsidiaries temporarily ceased operation.
However, 3 of the subsidiaries continued its operation in May and August during the
year.
a) Statement of compliance
The financial statements of the Company have been prepared in accordance with
the Malaysian Financial Reporting Standards (“MFRS”), International Financial
Reporting Standards and the requirements of Companies Act 2016 in Malaysia.
The accompanying financial statements have been prepared assuming that the
Group and the Company will continue as a going concern which contemplates
the realisation of assets and settlement of liabilities in the normal course of
business.
During the financial year, the Group and the Company has prepared its financial
statements by applying the going concern assumption, notwithstanding that the
Group and the Company incurred a net loss of RM5,165,493 and of RM
13,775,328 respectively during the financial year ended 31 December 2017, and
as at that date, the Group and the Company’s current liabilities exceeded its
current assets by RM77,125,700 and RM66,588,718 respectively and deficits of
shareholders’ funds of RM26,771,712 and RM59,343,790 respectively, thereby
indicating the existence of a material uncertainty which may cast significant doubt
about the Group’s and the Company’s ability to continue as a going concern.
22
The financial statements have been prepared under the historical cost
convention except as disclosed in the respective significant accounting policies.
The standards and interpretations that are issued but not yet effective up to date
of issuance of the Company’s financial statements are disclosed below. The
Company intends to adopt these standards, if applicable, when they become
effective.
Effective dates
for financial
periods beginning
on or after
23
The initial application of the abovementioned MFRSs are not expected to have
any significant impacts on the financial statements of the Company except as
mentioned below:
For liabilities, the standard retains most of the MFRS 139 requirements.
These include amortised cost accounting for most financial liabilities, with
bifurcation of embedded derivatives. The main change is that, in cases
where the fair value option is taken for financial liabilities, the part of a fair
value change due to an entity's own credit risk is recorded in OCI rather
than the profit or loss, unless this creates an accounting mismatch.
The Company are currently still in process of assessing the impact of the
new standards upon initial application of these standards.
24
b) Basis of measurement
The financial statements have been prepared on the historical cost basis other
than as disclosed in Note 3.
These financial statements are presented in Ringgit Malaysia (“RM”), which is the
Company’s functional currency.
25
Estimates and judgements are continually evaluated by the directors and the
management and are based on historical experience and other factors,
including expectations of future events that are believed to be reasonable under
the circumstances. The estimates and judgements that affect the application of
the Company’s accounting policies and disclosure, and have a significant risk
of causing a material adjustment to the carrying amount of assets, liabilities,
income and expenses are discussed below: -
The estimates for the residual values, useful lives and related
depreciation charges for the property, plant and equipment are
based on the commercial factors which could change significantly
as a result of technical innovations and competitors’ actions in
response to the market conditions. The Group and the Company
anticipates that the residual values of its property, plant and
equipment will be insignificant. As a result, residual values are not
being taken into consideration for the computation of the
depreciation amount. Changes in the expected level of usage and
technological development could impact the economic useful lives
and the residual values of these assets, therefore future
depreciation charges could be revised.
The value in use is the net present value of the projected future
cash flows derived from the business operations of the respective
subsidiaries discounted at an appropriate discount rate. Such a
discounted cash flow method involves the use of estimated future
results and a set of assumptions to reflect their income and cash
flows. Judgment was also used to determine the discount rate for
the cash flows and the future growth of the businesses of the
subsidiaries.
26
27
(x) Fair value estimates for certain financial assets and liabilities
The Group and the Company carries certain financial assets and
liabilities at fair value, which requires extensive use of accounting
estimates and judgment. While significant components of fair
value measurement were determined using verifiable objective
evidence, the amount of changes in fair value would differ if the
Group and the Company uses different valuation methodologies.
Any changes in fair value of these assets and liabilities would
affect profits and/or equity.
Subsidiaries are consolidated from the date on which control is transferred to the
Group up to the effective date on which control ceases, as appropriate.
29
30
Upon the loss of control of a subsidiary, the Group recognizes any gain or
loss on disposal in profit or loss which is calculated as the difference
between: -
(i) the aggregate of the fair value of the consideration received and
the fair value of any retained interest in the former subsidiary; and
31
Financial instruments are offset when the Group has a legally enforceable right to
offset and intends to settle either on a net basis or to realize the asset and settle
the liability simultaneously.
A financial instrument is recognized initially, at its fair value plus, in the case of a
financial instrument not at fair value through profit or loss, the transaction costs
that are directly attributable to the acquisition or issue of the financial instrument.
a) Financial assets
32
33
All financial liabilities are initially at fair value plus directly attributable
transaction costs and subsequently measured at amortised cost using the
effective interest method other than those categorized as fair value
through profit or loss.
Fair value through profit of loss category comprises financial liabilities that
are either held for trading or are designated to eliminate or significantly
reduce a measurement or recognition inconsistency that would otherwise
arise. Derivatives are also classified as held for trading unless they are
designated as hedges.
Ordinary shares classified as equity are measured at cost and are not
remeasured subsequently. Incremental costs directly attributable to the
issue of new ordinary shares or options are shown in equity as a
deduction, net of tax, from proceeds.
35
(d) Derecognition
On the disposal of the investments in subsidiaries, the difference between the net
disposal proceeds and the carrying amount of the investments is recognized in
profit or loss.
Property, plant and equipment, other than freehold land, leasehold land and
building are stated at cost less accumulated depreciation and impairment losses,
if any.
Leasehold land and building are stated at revalued amount less accumulated
depreciation and impairment losses recognized after the date of the revaluation.
Freehold land, leasehold land and building are revalued periodically, at least
once in every five (5) periods or earlier if circumstances indicate that the carrying
amount may differ significantly from the market value.
36
Rate
Leasehold land Over the lease periods
of 21 and 54 years
Shop house, factory buildings and improvement 2% to 10%
Plant, machinery and equipment 5% to 25%
Vessel 10%
Motor vehicles 10% to 20%
Furniture, fitting and office equipment 10%
The depreciation method, useful lives and residual values are reviewed, and
adjusted if appropriate, at the end of each reporting year to ensure that the
amounts, method and periods of depreciation are consistent with previous
estimates and the expected pattern of consumption of the future economic
benefits embodied in the items of the property, plant and equipment.
37
(a) Trademarks
3.7 IMPAIRMENT
All financial assets (other than those categorized at fair value through
profit or loss), are assessed at the end of each reporting year whether
there is any objective evidence of impairment as a result of one or more
events having an impact on the estimated future cash flows of the asset.
The carrying values of assets, other than those to which MFRS 136 –
Impairment of Assets does not apply, are reviewed at the end of each
reporting year for impairment when there is an indication that the assets
might be impaired. Impairment is measured by comparing the carrying
values of the assets with their recoverable amounts. The recoverable
amount of the assets is the higher of the assets’ fair value less costs to
sell and their value-in-use, which is measured by reference to discounted
future cash flows.
38
Assets acquired under hire purchase are capitalized in the financial statements at
the lower of the fair value of the leased assets and the present value of the
minimum lease payments and, are depreciated in accordance with policy set out
in Note 3.5 above. Each hire purchase payment is allocated between the liability
and finance charges so as to achieve a constant rate on the finance balance
outstanding. Finance charges so as to achieve a constant rate on the finance
balance outstanding. Finance charges are recognized in profit or loss over the
year of respective hire purchase agreements.
3.9 INVENTORIES
Inventories are stated at the lower of cost and the net realizable value. Cost is
determined on the first-in-first-out basis and comprises direct material, direct
labour costs and overheads that have been incurred in bringing the inventories to
their present location and condition.
Net realizable value represents the estimated selling price less the estimated
cost necessary to make the sale.
Income tax for the year comprises current and deferred tax.
Current tax is the expected amount of income taxes payable in respect of the
taxable profit for the reporting year and is measured using the tax rates that have
been enacted or substantively enacted at the end of the reporting year.
40
Deferred tax assets are recognized for all deductible temporary differences,
unused tax loses and unused tax credits to the extent that it is probable that
future taxable profits will be available against which the deductible temporary
differences, unused tax loses and unused tax credits can be utilized. The
carrying amounts of deferred tax assets are reviewed at the end of each
reporting year and reduced to the extent that it is no longer probable that
sufficient future taxable profits will be available to allow all or part of the deferred
tax assets to be utilized.
Deferred tax assets and liabilities are measured at the tax rates that are
expected to apply in the period when the asset is realized or the liability is
settled, based on the tax rates that have been enacted or substantively enacted
at the end of the reporting year.
Deferred tax assets and liabilities are offset when there is a legally enforce right
to set off current tax assets against current tax liabilities and when the deferred
income taxes relate to the same taxation authority.
Cash and bank balances comprise cash in hand, bank balances, bank overdrafts
and short-term, highly liquid investments that are readily convertible to known
amounts of cash and which are subject to an insignificant risk of changes in
value with original maturities period three months or less.
41
3.12 PROVISIONS
Provision are recognized when the Group and of the Company has a present
obligation as a result of past events, when it is probable that an outflow of
resources embodying economic benefits will be required to settle the obligation,
and when a reliable estimate of the amount can be made. Provisions are
reviewed at the end of each reporting year and adjusted to reflect the current
best estimate. Where the effect of the time value of money is material, the
provision is the present value of the estimated expenditure required to settle the
obligation. The unwinding of the discount is recognized as interest expense in
profit or loss.
Wages, salaries, paid annual leave and sick leave, bonuses and non-
monetary benefits are measured on an undiscounted basis and are
recognized in profit or loss in the year in which the associated services
are rendered by employees of the Group and of the Company.
42
(i) The entity and the reporting entity are members of the same group
(which means that each parent, subsidiary and fellow subsidiary is
related to the others).
(ii) One entity is an associate or joint venture of the other entity (or an
associate or joint venture of a member of a group of which the
other entity is a member).
(iii) Both entities are joint ventures of the same third party.
(iv) One entity is a joint venture of a third entity and the other entity is
an associate of the third party.
(v) The entity is a post-employment benefit plan for the benefit of the
employees of either the reporting entity or an entity related to the
reporting entity. If the reporting entity is itself such a plan, the
sponsoring employers are also related to the reporting entity.
(vi) The entity is controlled or jointly controlled by a person identified
in (a) above.
(vii) A person identified in (a)(i) above has significant influence over
the entity or is a member of the key management personnel of the
entity (or of a parent of the entity).
Close members of the family of a person are those family members who
may be expected to influence, or be influence by, that person in their
dealings with the entity.
Fair value is the price that would be received to sell an asset or paid to transfer a
liability in an orderly transaction between market participants at the measurement
date, regardless of whether that price is directly observable or estimated using a
valuation technique. The measurement assumes that the transaction takes place
either in the principal market or in the absence of a principal market, in the most
advantageous market. For non-financial asset, the fair value measurement takes
into account a market’s participant’s ability to generate economic benefits by
using the asset in its highest and best use or by selling it to another market
participant that would use the asset in its highest and best use.
43
For financial reporting purposes, the fair value measurements are analysed into
level 1 to level 3 as follows: -
Level 1: Inputs are quoted prices (unadjusted) in active markets for identical
assets or, liability that the entity can access at the measurement date;
Level 2: Inputs are inputs, other than quoted prices included within level 1, that
are observable for the asset or liability, either directly or indirectly; and
The transfer of fair value between levels is determined as of the date of the event
or change in circumstances that caused the transfer.
44
All other borrowing costs are recognized in profit or loss as expenses in the years
in which they incurred.
4. REVENUE
Revenue represents the gross invoiced value of goods sold less returns and discounts
allowed.
45
Group Company
2017 2016 2017 2016
RM RM RM RM
Audit fee
- current financial year 142,500 136,700 42,000 47,200
- overprovision in prior year (13,450) - - -
Depreciation charge 2,998,155 7,326,780 4,022 20,272
Director's remuneration 389,120 678,030 381,349 678,030
Gain on deconsolidated of subsidiary (2,019,944) - - -
Allowance for impairment loss:
- trade receivables - 5,237,941 - -
- other receivables - 3,647,935 - 283,376
Property, plant and equipment
written off 3,718,098 - - -
Impairment loss on property,
plant and equipment - 2,908,775 - -
Ammortisation on leasehold land 130,014 - - -
Interest expense:
- hire purchase 22,390 34,877 544 3,698
- term loans 3,616,917 3,975,753 91,594 -
- others 70,527 76,885 - -
Late interest expenses 266,859 - 266,859 -
Rental of motor vehicles - 157,776 - -
Rental of premises - 499,700 - -
Staff cost:
- salaries and other benefits 2,445,719 5,408,575 121,213 557,930
Bad debts recovered - (59,249) - -
Interest income - (163,178) - -
(Gain)/loss on disposal of
property, plant and equipment (498,011) (32,867) 27,130 -
Rental income - (95,236) - -
46
6. TAX EXPENSE
Group Company
2017 2016 2017 2016
RM RM RM RM
A reconciliation of income tax credit applicable to the loss before taxation at the statutory
tax rate to income tax credit at the effective rate of the Group and the Company is a
follows: -
Group Company
2017 2016 2017 2016
RM RM RM RM
47
Deferred tax assets have not been recognized in respect of the following items:
Group Company
2017 2016 2017 2016
RM RM RM RM
Unabsorbed capital
allowances 30,192,785 16,879,006 5,030,672 -
Unabsorbed reinvestment
allowances 6,075,599 15,060,000 - -
Group
Continuing operations 2017 2016
RM RM
The diluted loss per share were not presented as there were no dilutive potential
ordinary shares outstanding at the end of the reporting year.
48
Depreciation
As at 1 January 2016 - 797,888 10,203,697 3,980,941 73,264,617 1,928,986 90,176,129
Charge for the year - 129,235 814,213 171,442 6,125,989 85,901 7,326,780
As at 31 December 2016/1 January 2017 - 927,123 11,017,910 4,152,383 79,390,606 2,014,887 97,502,909
Charge for the year - 130,014 785,483 77,442 2,102,030 33,200 3,128,169
Disposal - - - (814,092) (2,360,969) - (3,175,061)
For the Financial Year Ended 31 December 2017
Carrying amount
As at 1 January 2016 4,376,267 6,571,797 30,992,687 534,508 25,156,982 469,379 68,101,620
As at 31 December 2016/1 January 2017 4,376,267 6,442,562 30,136,044 242,109 16,445,697 348,221 57,990,900
As at 31 December 2017 4,376,267 6,312,548 29,350,561 27,221 10,266,470 323,048 50,656,115
NOTES TO THE FINANCIAL STATEMENTS (Cont’d)
49
Motor Office
Company vehicles equipment Total
RM RM RM
Cost
As at 1 January 2016/31 December 2016 195,000 7,721 202,721
Disposal (195,000) - (195,000)
As at 31 December 2017 - 7,721 7,721
Depreciation
As at 1 January 2016 71,500 1,885 73,385
Charge for the year 19,500 772 20,272
As at 31 December 2016/1 January 2017 91,000 2,657 93,657
Charge for the year 3,250 772 4,022
Disposal (94,250) - (94,250)
As at 31 December 2017 - 3,429 3,429
Carrying amount
As at 1 January 2016 123,500 5,836 129,336
As at 31 December 2016/1 January 2017 104,000 5,064 109,064
As at 31 December 2017 - 4,292 4,292
(a) Included in the assets of the Group at the end of the reporting year were motor
vehicles with a total net book value of RM373,608 (2016: RM581,247) which
were acquired under hire purchase terms.
(b) The freehold land, leasehold land and buildings of the Group have been pledged
to licensed banks as securities for banking facilities granted to the Group with a
total net carrying amount of RM40,039,374 (2016: RM40,954,873).
(c) Freehold land, leasehold land, factory buildings and improvement have been
revalued in the financial period 31 December 2015 based on valuations
performed by Mark Saw Khay Liang, FRICS, FRISM a valuer from PPC
International (Penang) Sdn Bhd. The firms is independent firm of professional
valuers, and the valuations were arrived at using the ‘Comparison method’ and
‘Cost method’ of valuation.
50
9. INVESTMENT IN SUBSIDIARIES
Company
2017 2016
RM RM
51
Bersatu Sago Industries Sdn. Malaysia 100 100 Has ceased operations
Bhd. since January 2017
During the financial year, Rasayang Food Industries Sdn Bhd (“RFISB”) has been wound
up pursuant to Court Order dated 27 September 2017. Hence, the Group deconsolidated
RFISB and the effects of the deconsolidation on the financial results of the Group during
the financial year were as follows:
From 1.1.2017
to 27.9.2017
RM
Revenue -
52
27.9.2017
RM
The secondary bonds with the maturity date on 26 January 2012 have been charged to
the Trustee for the benefit of the Bondholders pursuant to primary collateralized loan
obligations transactions entered into by the lending bank.
The impairment loss arose from the non-receipt of funds on maturity of the secondary
bonds.
53
12. INVENTORIES
Group
2017 2016
RM RM
At cost:
Consumables stock 39,250 -
Finished goods 888,396 -
Raw material 396,260 -
Packaging material 357,574 -
Work in progress 19,922 -
1,701,402 -
(a) The Group’s normal trade credit terms range from 30 to 120 (2016: 30 to 120)
days.
(b) The allowance for impairment losses is made mainly on those trade receivables
in significant financial difficulties and has defaulted on payments.
54
Group Company
2017 2016 2017 2016
RM RM RM RM
Group Company
2017 2016 2017 2016
RM RM RM RM
Allowance for impairment
losses:
As at 1 January 2,210,036 2,210,036 283,376 -
Addition during the year - - - 283,376
Reversal during the year (2,177,006) - - -
As at 31 December 33,030 2,210,036 283,376 283,376
For the purpose of the statement of cash flows, cash and bank balances comprise the
following: -
Group Company
2017 2016 2017 2016
RM RM RM RM
55
The movements in the authorised and paid-up share capital of the Company are as
follows: -
Group/Company
2017 2016
Number of Monetary Number of Nominal
shares value shares value
Unit RM Unit RM
Authorised
Ordinary shares of
RM0.15 each* - - 400,000,000 60,000,000
The new Companies Act, 2016 (“The Act”), which come into enforcement on 31st
January 2017, abolished the concept of authorised share capital and introduced “no par
value shares” regime. Consequently, the amounts standing to the credit of the share
premium account shall become part of the Company’s share capital pursuant to the
transitional provisions set out in Section 618(2) of the Act. Notwithstanding this
provision, the Company may within 24 months from the commencement of the Act, use
the amount standing to the credit of its share premium account of RM3,600,000 for
purposes as set out in Section 618(3) of the Act. There is no impact on the numbers of
ordinary shares in issue or the relative entitlement of any of the members as a result of
this transition.
The movement in the share premium of the Group and the Company are as follows: -
Group/Company
2017 2016
RM RM
The share premium is not distributable by way of dividends and due to enforcement of
Companies Act, 2016, the Company may within 24 months from commencement of the
Act, use the amount standing for the purpose as set out in Section 618(3) of the Act.
56
18. RESERVE
Group Company
2017 2016 2017 2016
RM RM RM RM
Non-distributable
Capital reserve 4,837,366 4,837,366 4,837,366 4,837,366
Revaluation reserve 9,204,366 9,204,366 - -
Warrant reserve 6,000,000 6,000,000 6,000,000 6,000,000
Other reserve (6,000,000) (6,000,000) (6,000,000) (6,000,000)
14,041,732 14,041,732 4,837,366 4,837,366
57
Group Company
2017 2016 2017 2016
RM RM RM RM
Current
Not later than one year 71,869 535,206 - 76,234
Non-Current
Later than one year 302,129 - - -
Group Company
2017 2016 2017 2016
RM RM RM RM
Current
Revolving credit 2,968,524 2,524,000 - -
Term loans 66,585,602 56,138,769 63,832,277 53,400,163
69,554,126 58,662,769 63,832,277 53,400,163
The revolving credit and term loans bore a weighted average of 8.35% (2016: 8.35%)
per annum at the end of the reporting year and are secured by: -
(i) Legal charges over the property, plant and equipment as disclosed in Note 8 to
the financial statements;
(ii) A debenture by way of fixed and floating charge over all present and future
assets belonging to the Group;
(iii) Personal guaranteed by a former director of the Company.
58
At 1 January - 529,821
Recognised in profit or loss (Note 6) - (529,821)
At 31 December - -
The normal trade credit term granted to the Group and the Company is 30 to 90 (2016: 30 to
90) days.
Group Company
2017 2016 2017 2016
RM RM RM RM
Group
2017 2016
RM RM
Executive directors:
- fee 36,000 -
- non-fee emoluments 128,971 656,616
Non-Executive directors
- fee 180,000 -
- non-fee emoluments 44,149 22,000
389,120 678,616
59
Group
2017 2016
Executive directors:-
Below RM100,000 3 1
RM100,001 to RM200,000 - -
RM200,001 to RM300,000 - -
Above RM300,001 - 1
Non-Executive director
Below RM100,000 8 2
RM100,001 to RM200,000 - 1
11 5
(b) Other than those disclosed elsewhere in the financial statements, the Group and
the Company also carried out the following significant transactions with the
related parties during the financial year: -
Group Company
2017 2016 2017 2016
RM RM RM RM
Management fees
received/receivable from
subsidiaries - - 753,000 1,836,000
60
The Group operates predominantly in manufacturing and marketing of all type of rice
and sago sticks (vermicelli), sago starch and related products in Malaysia. Accordingly,
the information by business and geographical segment is no presented.
MAJOR CUSTOMERS
The group client base consists mainly of small wholesalers and retailers and hence
disclosure for major customers is not representable and irrelevant.
Group Company
2017 2016 2017 2016
RM RM RM RM
Unsecured
The Group’s and the Company’s activities are exposed to a variety of market risk
(including foreign currency risk, interest rate risk and equity price risk), credit risk and
liquidity risk. The Group’s overall financial risk management policy focuses on the
unpredictability of financial markets and seeks to minimise potential adverse effects on
the Group’s and the Company’s financial performance.
The Group’s and the Company’s policies in respect of the major areas of
treasury activity are as follows: -
The Group and the Company’s does not have any transactions or
balances denominated in foreign currencies and hence not
exposed to foreign currency risk.
61
Interest rate risk is the risk that the fair value or future cash flows
of a financial instrument will fluctuate because of changes in
market interest rates. The Group’s and the Company’s exposures
to interest rate risk arise mainly from interest-bearing financial
liabilities. The Group’s and the Company’s policy is to obtain the
most favourable interest rates available. Any surplus funds of the
Group and the Company will be placed with licensed financial
institutions to generate interest income.
Group Company
2017 2016 2017 2016
Increase/ Increase/ Increase/ Increase/
(Decrease) (Decrease) (Decrease) (Decrease)
RM RM RM RM
Effect on Profit
After Taxation
Increase of 10 bp 53,145 44,990 48,513 41,102
Decrease of 10 bp (53,145) (44,990) (48,513) (41,102)
The Group and the Company does not have any quoted
investments and hence is not exposed to equity price risk.
62
The Group’s and the Company’s exposure to credit risk, or the risk of
counterparties defaulting, arises mainly from trade and other receivables.
The Group and the Company manages its exposure to credit risk by the
application of credit approvals, credit limits and monitoring procedures on
an ongoing basis. For other financial assets (including cash and bank
balances), the Group and the Company minimizes credit risk by dealing
exclusively with high credit rating counterparties.
The Group and the Company does not have any major
concentration of credit risk related to any individual customer or
counterparty.
As the Group and the Company does not have any major
concentration of credit risk related to any individual customer or
counterparty.
63
2017
Past due:
1 to 30 days past due date 719,387 - - 719,387
31 to 60 days past due 658,286 - - 658,286
61 to 90 days past due 65,942 - - 65,942
more than 91 days past due 13,905,054 (13,837,266) - 67,788
15,348,669 (13,837,266) - 1,511,403
2016
Past due:
1 to 30 days past due date - - - -
31 to 60 days past due - - - -
61 to 90 days past due - - - -
more than 91 days past due - - - -
- - - -
64
A significant portion of trade receivables that are neither past due nor
impaired are regular customers that have been transacting with the
Group and the Company. The Group and the Company uses ageing
analysis to monitor the credit quality of the trade receivable. Any
receivables having significant balance past due or more than 91 days,
which are deemed to have higher credit risk, are monitored individually.
65
Liquidity risk arises mainly from general funding and business activities.
The Group and the Company practices prudent risk management by
maintaining sufficient cash balances and the availability of funding
through certain committed credit facilities.
The following table sets out the maturity profile of the financial liabilities at
the end of the reporting year based on contractual undiscounted cash
flows (including interest payments computed using contractual rates or, if
floating, based on the rates at the end of the reporting year):-
Weighted
Average Contractual
Effective Carrying Undiscounted Within Over
Rate Amount Cash Flows 1 Year 1 Year
Group % RM RM RM RM
2017
Hire purchase
payables 3.86 373,998 373,998 71,869 302,129
Revolving credit 8.35 2,968,524 2,968,524 2,968,524 -
Term loans 8.35 66,585,602 66,585,602 66,585,602 -
Trade payables - 8,836,250 8,836,250 8,836,250 -
Other payables
and accruals - 3,390,168 3,390,168 3,390,168 -
82,154,542 82,154,542 81,852,413 302,129
2016
Hire purchase
payables 3.86 535,206 535,206 535,206 -
Revolving credit 8.35 2,524,000 2,524,000 2,524,000 -
Term loans 8.35 56,138,769 56,138,769 56,138,769 -
Trade payables - 8,570,508 8,570,508 8,570,508 -
Other payables
and accruals - 12,957,363 12,957,363 12,957,363 -
80,725,846 80,725,846 80,725,846 -
66
Weighted
Average Contractual
Effective Carrying Undiscounted Within Over
Rate Amount Cash Flows 1 Year 1 Year
Company % RM RM RM RM
2017
2016
Hire purchase
payables 2.42 76,234 681,821 18,946 662,875
Term loans 8.35 53,400,163 53,400,163 4,300,000 49,100,163
Other payables
and accruals - 10,914,647 10,914,647 10,914,647 -
64,391,044 64,996,631 15,233,593 49,763,038
67
Group Company
2017 2016 2017 2016
RM RM RM RM
Financial assets
Available-for-sale financial assets
Other investment 1 1 1 1
Financial liabilities
At the end of the reporting year, there were no financial instruments carried at
fair values.
The fair values of the financial assets and financial liabilities approximated their
carrying amounts due to the relatively short-term maturity of the financial
instruments (maturing within the next 12 months and/or undefined repayment
term). The fair values are included in level 2 of the fair value hierarchy.
The fair value of the non-current portion of receivables and payables equal the
carrying amounts as the impact of discounting is not material.
68
The Group and the Company manages its capital by maintaining an optimal capital
structure so as to support their businesses and maximise shareholder(s) value. To
achieve this objective, the Group and the Company may make adjustments to the
capital structure in view of changes in the economic conditions, such as adjusting the
amount of dividend payment, returning of capital to shareholders or issuing new shares.
The Group and the Company manages its capital based on debt-to-equity ratio that
complies with debt covenants and regulatory, if any. The debt-to-equity ratio is
calculated as total borrowings from financial institutions divided by total equity.
There was no change in the Group’s and the Company’s approach to capital
management during the financial year.
The debt-to-equity ratio of the Group and of the Company at the end of the reporting
year was as follow: -
Group Company
2017 2016 2017 2016
RM RM RM RM
Dinxings (M) Sdn Bhd (“Dinxings”) filed a Writ of Summons and Statement of
Claim against the Company’s Subsidiary, Kilang Bihun Bersatu (East Malaysia)
Sdn Bhd (‘KBBEMSB’). Dinxings had sought against KBBEM the following:
69
(v) further and other reliefs as the Court deems fit and proper to grant.
Penang Magistrate Court has fixed next case management on 23 April 2018
pending the expiry of restraining order obtained by the Company and its
subsidiaries.
The Directors are of the view that there is no material impact to the financial
statements of the Group and the Company.
BPMB has granted BBA facilities under Islamic Banking Scheme to KBBSB and
the Company is Corporate Guarantors. KBBSB has defaulted in payments and
the said facilities were called back by the BPMB. BPMB seeks against KBBSB
for the following:
Penang High Court has fixed next case management on 24 April 2018 pending
the expiry of restraining order obtained by the Company and its subsidiaries.
70
30.3 Litigation with Tan Hooi Ming & Tan Hooi Kang (SEV Partnership
Enterprise)
Tan Hooi Ming and Tan Hooi Kang, both trading under the name and style of
SEV Partnership Enterprise seeks against KBBSB for the following to be paid
within 21 days from the date of the receipt of the Notice:
(i) Principal Sum of RM1,625,475 being the debt remaining due for the
goods sold and delivered upon KBBSB’s request as at 30 August 2017.
(ii) The sum of RM21,376 being interest of 4% on the outstanding amount of
RM1,625,475 calculated on per annum basis from 30 August 2017 until
the date of the Notice.
(iii) The costs of RM5,000.
Penang High Court has fixed next case management on 2 May 2018 pending the
expiry of restraining order obtained by the Company and its subsidiaries.
KBBSB is required to enter appearance to the above action within 14 days from
20 December 2017, failing which, default judgement and execution may be
entered against KBBSB.
According to the Statement of Claims, CHEP had from period of January 2016 to
August 2017 issued several invoices to KBBSB for the pallets hired under the
Hire Agreement. The total outstanding amount up to 26 August 2017 is
RM60,103. CHEP had demanded for the Outstanding Amount and KBBSB have
despite repeated reminders from the CHEP, failed to pay the Outstanding
Amount.
Kuala Lumpur Magistrate Court has fixed next case management on 23 April
2018 pending the expiry of restraining order obtained by the Company and its
subsidiaries.
The Directors are of the view that there is no material impact to the financial
statements of the Group and the Company.
KBBSB is required to enter appearance to the above action within 14 days from 7
December 2017, failing which, default judgment may be entered against KBBSB.
Shell had granted the Shell Fleet Card to KBBSB upon such terms and
conditions as in the Shell Cardholder Agreement. As at 31 December 2016,
KBBSB had used the Shell Fleet Card at various petrol stations in Malaysia and
had incurred the sum of RM45,374 in purchasing fuels. Consequently, Shell had
through a firm of lawyers acting on their behalf issued a letter of demand dated
10 August 2017 to KBBSB demanded the outstanding sum of RM45,374 due to
Shell. However to date, KBBSB fails/refuses and/or still fails or refuses to pay the
sum demanded by Shell. Shell seeks against KBBSB for the following:
Penang Magistrate Court has fixed next case management on 23 April 2018
pending the expiry of restraining order obtained by the Company and its
subsidiaries.
The Directors are of the view that there is no material impact to the financial
statements of the Group and the Company.
73
The Bukit Raya Sdn Bhd (“BRSB”), filed winding up petition against Kilang Bihun
Bersatu Sdn Bhd (“KBBSB”), based on purported debt of RM 917,577 remained
unpaid after Notice pursuant to Section 465 & 466 Companies Act 2016.
Penang High Court has fixed next case management on 25 May 2018 pending
the expiry of restraining order obtained by the Company and its subsidiaries.
The Great Line Success Sdn Bhd (“GLSSB”), filed winding up petition against
Kilang Bihun Bersatu Sdn Bhd (“KBBSB”), based on purported debt of RM
349,802 remained unpaid after Notice pursuant to Section 465 & 466 Companies
Act 2016.
Penang High Court has fixed next case management on 26 April 2018 pending
the expiry of restraining order obtained by the Company and its subsidiaries.
.
On 30 August 2016, the Company announced that it had triggered the prescribed
criteria pursuant to Paragraph 8.04 and Paragraph 2.1 (a) of Practice Note 17
(“PN17”) of the Main Market Listing Requirements of Bursa Malaysia Securities
Berhad (“Bursa Securities”) and was hence an affected issuer under PN17.
The Company is required to take necessary steps to comply with the following
obligations:
(i) within twelve (12) months from the date of this announcement that the
Company is an affected issuer under PN17 on 30 August 2016, to submit
a Regularisation Plan to the Securities Commission of Malaysia and
Bursa Securities;
(ii) Implement the Regularisation Plan within the time frame stipulated by the
SC and/or Bursa Securities, as the case may be;
(iii) Announce within three (3) months from the First Announcement, whether
the Regularisation Plan will result in a significant change in the business
direction or policy of the Company;
74
(iv) Announce the status of the Regularisation Plan and the number of
months to the end of the relevant time frames referred to in Paragraphs
5.1 and 5.2 of PN17, as may be applicable, on a monthly basis until
further notice from Bursa Securities;
(vii) where the Company fails to regularise its condition, it will announce the
dates of suspension and de-listing of its listed securities, immediately
upon notification of suspension and de-listing by Bursa Securities.
Pursuant thereto, the Proposed Regularisation Plan shall comprise the following:-
a) Proposed Capital Reconstruction;
b) Proposed Debt Restructuring Scheme;
c) Proposed Rights Issue with Warrants; and
d) Proposed Acquisition.
76
According to the Statement of Claims, SEV issued a letter dated 4 April 2016 to
Rasayang demanded the sum of RM628,510 as at 28 March 2016 due to SEV.
However, Rasayang fails/refuses and/or still fails or refuses to pay the sum
demanded by SEV. Subsequent to that, on 27 September 2017 Rasayang was
wound up by the Court Order based on the petition filed by SEV on 29 March
2017.
The financial statements have been approved for issue in accordance with a resolution
of the Board of Directors on the date of these financial statements.
77
(N1) Deemed interested by virtue of Section 8 of the Companies Act, 2016 held through Vibrant Class
Sdn. Bhd.
Y. Bhg. Tan Sri Dato’ Seri Tan King Tai @ - - 64,063,900 (N1) 20.53
Tan Khoon Hai
Fong Yit Meng 7,125,700 2.28 - -
Dato’ Dr. Chin Yew Sin (JP) - - - -
Leong Woay Hong @ Neoh Woay Hong - - 50,000 (N2) 0.016
Lim Choo Hooi - - - -
Khairuddin Bin Jaflus - - - -
(N1) Deemed interested by virtue of Section 8 of the Companies Act, 2016 held through Vibrant Class
Sdn. Bhd.
According to the Record of Depositors, the 30 largest shareholders of the Company as at 30 March 2018 are
as follows:-
Number of
No. Name Shares %
M & A NOMINEE (TEMPATAN) SDN BHD GENTING UTAMA
1 SDN BHD FOR VIBRANT CLASS SDN BHD 33,300,000 10.673
2 VIBRANT CLASS SDN BHD 30,763,900 9.860
3 YEOH PHAIK SUAN 9,103,100 2.917
4 FONG YIT MENG 7,125,700 2.283
5 YEN SWEE FOONG 6,900,000 2.211
6 NAVANEETHAKRISHNER A/L KATHIRGAMATAMBY 5,900,000 1.891
7 SELLACHY A/P KATHIRGAMATAMBY 5,628,300 1.803
8 HARUMI TAKIZAWA 5,471,700 1.753
9 LAU JIT WENG 3,900,000 1.250
No. of Warrant
Directors Direct Indirect
Interest % Interest %
According to the Record of Depositors, the 30 largest warrant holders of the Company as at 30 March 2018
are as follows :-
Number of
No. Name Warrant %
1 NGEE PENG SOON 4,290,400 3.575
2 SEAH CHIN LENG 3,500,000 2.916
CIMSEC NOMINEES (TEMPATAN) SDN BHD PLEDGED
3 SECURITIES ACCOUNT FOR KHOR KIM HOCK (B B KLANG-CL) 2,725,100 2.270
4 LEONG KHOON HUAT 2,000,000 1.666
5 TAY TIAN SEN 2,000,000 1.666
6 MUHAMMAD MUHSIN BIN MOHD MASHOR 1,900,000 1.583
7 OOI ENG HOOI 1,600,000 1.333
8 WONG KOOK CHEE 1,500,000 1.250
9 YEOW BOON LEONG 1,500,000 1.250
10 MAYBANK NOMINEES (TEMPATAN) SDN BHD ISMAIL BIN JUSOH 1,421,400 1.184
CIMSEC NOMINEES (TEMPATAN) SDN BHD CIMB FOR CHEAH
11 SENG CHYE (PB) 1,400,000 1.166
12 MAYBANK NOMINEES (TEMPATAN) SDN BHD WONG KAR ZENG 1,400,000 1.166
RHB CAPITAL NOMINEES (TEMPATAN) SDN BHD MOHD FALIQ
13 BIN ZAINAL AZMI 1,344,000 1.120
14 LING SING TIONG 1,318,000 1.098
15 MOHAMMAD HAIKAL BIN ABDUL HALIM 1,040,000 0.866
16 ANG AH EAN 1,028,200 0.856
17 LEE ENG HOCK 1,000,000 0.833
18 SABBIR HUSAIN BIN AKBARALI 1,000,000 0.833
19 LYE EIT PING 998,000 0.831
PUBLIC NOMINEES (TEMPATAN) SDN BHD PLEDGED
20 SECURITIES ACCOUNT FOR KANG CHIN HONG (E-PPG) 930,100 0.775
21 CHIN LAM FEI 900,000 0.750
22 SEAH CHEE YEN 900,000 0.750
23 TANG WEI PIAU 840,000 0.700
24 CHAN AH LUAN 800,000 0.666
25 KONG LIENG TEE 800,000 0.666
MAYBANK NOMINEES (TEMPATAN) SDN BHD WAN MOHD
26 RAZDAN BIN WAN MOHD ZAIN 800,000 0.666
TA NOMINEES (TEMPATAN) SDN BHD PLEDGED SECURITIES
27 ACCOUNT FOR CHEAH SOW KIEN 800,000 0.666
28 WONG CHEE KHEONG 800,000 0.666
29 ZAMZURI BIN MOHAMMED TAHIR 750,000 0.625
30 YAU YIK LIAN 741,200 0.617
42,026,400 35.022
Net
Land/ Approximate
Carrying Date of
Existing Built - Age of Tenure
Location/Address Amount @ Valuation/
Use up Area Building/Land (Expiry Date)
31.12.2017 Acquisition
(m²) (year)
(RM'000)
Lot 208, Kawasan Factory & 25,264/ 15 Leasehold 22,676 19.08.2015
Perindustrian Kuala office 10,045 60 years with (Valuation)
Ketil, Mukim Tawar, premises a possibility to
District of Baling, extend for a
Kedah Darul Aman further 39
years
Lot 1178, Block 19, Factory & 4,073/ 21 Leasehold 4,557 30.06.2015
Seduan Land office 1,072 60 years (Valuation)
District, Sarawak premises (16.9.2051)
Lot 3162, Retus Factory & 1,153/ 11 Freehold 73 30.06.2015
Land District, Ulu office 2,205 (Valuation)
Sungai Danan, premises
Batang Igan, Sibu,
Sarawak
Lot 3161, 3164, Agriculture 34,945/ Lot 3319 & Leasehold 2,275 30.06.2015
3319 Retus Land Land & 3,845 3161 - 47 Lot 3319 & (Valuation)
District, Ulu Sungai building Lot 3164 - 48 3161 30.06.2015
Danan, Batang 99 years (Valuation)
Igan, Sibu, (31.12.2068)
Sarawak Lot 3164
99 years
(31.12.2067)
Lot 259 , Block 134, Factory 17,446 10 Leasehold 3,456 30.06.2015
Mukah Land Land & 99 years (Valuation)
District, Sarawak building (31.12.2035)
of ……………………………………………………..…………………………………………………………………………..……………………………………………….
(Address)
…………………………………………………………………………………………………………………………………..………………..…………………………………
(Address)
or failing whom, the Chairman of the meeting as *my/our proxy to vote for *me/us on *my/our behalf at the 15th Annual
General Meeting (“AGM”) of EKA Noodles Berhad will be held at Lot 208, Phase II, Kuala Ketil Industrial Estate, 09300 Kuala
Ketil, Kedah Darul Aman on Tuesday, 22 May 2018 at 11.00 a.m. and at any adjournment thereof.
Please indicate with an “x” in the appropriate spaces provided above on how you wish your vote to be cast. If no specific
direction as to voting is given, the proxy may vote as he thinks fit.
Notes:
1. A proxy may but need not be a member of the Company.
2. For a proxy to be valid, this form must be duly completed and deposited at the Registered Office of the Company, 51-21-A
Menara BHL Bank, Jalan Sultan Ahmad Shah, 10050 Penang not less than twenty-four (24) hours before the time appointed
for the taking of the poll or at any adjournment thereof. Last date and time for lodging of Proxy Form will be on Monday, 21
May 2018 at 11.00 am (being the approximate time appointed for the taking of the poll at the 15th AGM)
3. A member shall be entitled to appoint one (1) or more proxies to attend and vote instead of him at the same
meeting and where a member appoints two (2) or more proxies to vote at the same meeting, such appointment shall be
invalid unless he specifies the proportion of his shareholding to be represented by each proxy.
4. Where a member is an exempt authorized nominee which holds ordinary shares of the Company for multiple beneficial
owners in one securities account (“omnibus account”), there is no limit to the number of proxies it may appoint in respect of
each omnibus account it holds.
5. In the case of a corporate member, this form must be executed under the corporation’s common seal or under the hand of
an officer or attorney duly authorised.
6. In respect of deposited securities, only a depositor whose name appear on the Record of Depositors on 15 May 2018
(General Meeting Record of Depositors) shall be eligible to attend the meeting or appoint proxies to attend and/or vote on
his/her behalf.
7. Pursuant to Paragraph 8.29A of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, all the
resolutions set out in the notice of 15th AGM will be put to vote by poll.
STAMP
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