Cycle & Carriage Bintang Berhad Annual Report 2009...Cycle & Carriage Bintang Berhad Annual Report 2009 1 CONTENTS 2 Financial Highlights 3 Corporate Proﬁ le 3 Corporate Information

Annual Report

Company No. 7378-DCycle & Carriage Bintang Berhad

FINANCIAL CALENDAR

Financial year ended 31 December 2009Announcement of results:– fi rst quarter 21 April 2009

– second quarter 30 July 2009

– third quarter 5 November 2009

– fourth quarter 23 February 2010

Issue of Annual Report 5 April 2010

2010 Annual General Meeting 27 April 2010

Entitlement to 2009 fi nal dividend 31 May 2010

Payment of 2009 fi nal dividend 25 June 2010

Financial year ending 31 December 2010

Announcement of results:

– fi rst quarter 27 April 2010

– second quarter 22 July 2010

– third quarter 3 November 2010

– fourth quarter 24 February 2011

Cycle & Carriage Bintang Berhad Annual Report 2009

1

CONTENTS

2 Financial Highlights3 Corporate Profi le3 Corporate Information4 Chairman’s Statement5 Penyata Pengerusi6 Board of Directors8 Corporate Governance Statement12 Statement of Internal Control13 Audit Committee Report14 Audit Committee Terms of Reference16 Additional Compliance Information16 Statement of Directors’ Responsibility for Preparing the Financial Statements17 Statutory Financial Statements63 Five-Year Summary64 Financial Charts65 Group Properties66 Shareholding Statistics67 Notice of Annual General Meeting70 Statement Accompanying Notice of Annual General Meeting Form of Proxy

A member of the Jardine Cycle & Carriage Group


2

• Earnings from underlying operations up 12%• Vehicle unit sales rose 6%• Lower corporate overhead expenses

Results 12 months ended

31 December

2009 2008 Change RM’000 RM’000 %

Revenue from underlying operations 466,320 513,090 (9)Net profi t from underlying operations:(a) Mercedes-Benz operations 12,414 9,883 26(b) MBM dividend 11,229 11,229 – 23,643 21,112 12Non-recurring items:(a) Net gain on restructuring and property sale – 6,958 (100)(b) One-off premium from investment in MBM – 18,715 (100)(c) Refund of duties 4,486 – 100 4,486 25,673 (83)Net profi t attributable to shareholders 28,129 46,785 (40)

Sen Sen

Earnings per share– Based on net profi t from underlying operations 23.5 20.9 12– Based on net profi t attributable to shareholders 27.9 46.4 (40)

Dividend per share (gross)– Normal 10.0 10.0 –– Special 120.0 135.0 (11)

As at 31 December

2009 2008 RM’000 RM’000

Shareholders’ funds 158,120 228,217 (31)

RM RM

Net assets per share 1.57 2.27 (31)

FINANCIAL HIGHLIGHTS


3

CORPORATE INFORMATION

Board of Directors

Benjamin William Keswick, Chairman(Alternate: Chiew Sin Cheok)

Datuk Syed Tamim Ansari bin Syed Mohamed, Deputy Chairman(Alternate: Mohkam Singh A/L Tara Singh)

Tan Sri Dato’ Sulaiman bin SujakCheah Kim Teck(Alternate: Ho Yeng Tat)

Vimala Menon

Audit Committee

Vimala Menon, Chairman

Tan Sri Dato’ Sulaiman bin SujakCheah Kim Teck

Remuneration Committee

Benjamin William Keswick, Chairman

Tan Sri Dato’ Sulaiman bin SujakVimala Menon

Nomination Committee

Tan Sri Dato’ Sulaiman bin Sujak, Chairman Benjamin William Keswick Vimala Menon

Secretaries

Yeap Kok LeongOh Swee Chin

Auditors

PricewaterhouseCoopersChartered Accountants

Registrar

Tricor Investor Services Sdn. Bhd.(Formerly known as Tenaga Koperat Sdn. Bhd.)Level 17, The Gardens North TowerMid Valley CityLingkaran Syed Putra 59200 Kuala Lumpur Telephone: 03-22643883Facsimile: 03-22821886

Registered Offi ce

Level 18, The Gardens North Tower Mid Valley CityLingkaran Syed Putra59200 Kuala LumpurTelephone: 03-22648888Facsimile: 03-22822733

Website

www.ccb.com.my

CORPORATE PROFILE

Cycle & Carriage Bintang, a member of the Jardine Cycle & Carriage Group, is listed on Bursa Malaysia and is the largest dealer of Mercedes-Benz vehicles in Malaysia. It is involved in the retail and after-sales service of Mercedes-Benz motor vehicles.

Jardine Cycle & Carriage (“JC&C”) is a leading Singapore-listed company and a member of the Jardine Matheson Group. It has an interest of just over 50% in Astra, a major listed Indonesian conglomerate, and other motor interests in Southeast Asia. Together with its subsidiaries and associates, JC&C employs some 137,000 people across Indonesia, Malaysia, Singapore and Vietnam.


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CHAIRMAN’S STATEMENT

Overview

The Malaysian economy contracted by 4% in 2009 against the background of the global economic downturn. The automotive sector saw the volume of new vehicles sold declining by 2% to 537,000 units, while the non-national vehicle segment fell by 6%.

Performance

The Group’s revenue for the year ended 31 December 2009 decreased by 9% to RM466.3 million. Net profi t from underlying operations rose by 12% to RM23.6 million, due mainly to lower overhead expenses following the restructuring undertaken in 2008.

The net profi t attributable to shareholders of RM28.1 million benefi ted from a refund of RM4.5 million of duties which were written off in earlier years and lower overhead expenses. The result was, however, 40% lower than the previous year which had been enhanced by non-recurring gains of RM25.7 million.

The Board is recommending a fi nal dividend of 5 sen per share less tax, which, together with the interim dividend will give a total dividend of 10 sen per share. A special dividend of RM 1.20 per share less tax was paid in September 2009 as part of the Group’s plan of returning to shareholders surplus cash not required for its operations.

Business Activities

Sales of Mercedes-Benz passenger cars rose by 6% to 1,600 units in 2009, compared with 2008 which had suffered from supply constraints of the C-Class. During 2009, the Group successfully completed the run-out of the old E-Class ahead of the launch of the new model in the last quarter of the year. Response to the new E-Class has been encouraging.

In view of the economic slow down, there was an increase in marketing campaigns to attract customers to the after-sales activities, while steps taken to reduce costs proved effective. Corporate overheads were also lower as the Group continued to benefi t from the prior year’s restructuring.

People

Dato’ Khalid who has been on the Board since February 2003 retired in December 2009. I would like to thank him for his services and contribution to the Group. I would also like to welcome Datuk Syed Tamim who was appointed to the Board in January 2010.

I would like to thank all our staff for their dedication and hard work during these challenging times. I also wish to thank our customers, shareholders and business partners for their continued support.

Prospects

The outlook for 2010 is positive as consumer confi dence is expected to improve with the recovery of the Malaysian economy, although risks remain as to the sustainability of the recovery when stimulus packages are gradually withdrawn.

Ben Keswick Chairman23 February 2010


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PENYATA PENGERUSI

Tinjauan Menyeluruh

Ekonomi Malaysia menyusut 4% pada tahun 2009 ekoran kemelesetan persekitaran ekonomi global. Justeru, jumlah kenderaan baru yang dijual dalam sektor automotif telah menurun pada kadar 2% kepada 537,000 unit, manakala segmen kenderaan bukan nasional jatuh 6%.

Prestasi

Hasil Kumpulan bagi tahun berakhir 31 Disember 2009 menyusut sebanyak 9% kepada RM466.3 juta. Walau bagaimanapun, keuntungan bersih daripada operasi asas meningkat 12% kepada RM23.6 juta disebabkan terutamanya oleh perbelanjaan overhed yang lebih rendah susulan penyusunan semula yang dilaksanakan pada tahun 2008.

Keuntungan bersih milik pemegang saham sebanyak RM28.1 juta memanfaat daripada pembayaran balik duti sebanyak RM4.5 juta yang telah dihapuskira pada tahun-tahun sebelumnya serta turut disumbangkan oleh perbelanjaan overhed yang lebih rendah. Walau bagaimanapun, hasil tersebut adalah 40% lebih rendah berbanding tahun sebelumnya yang telah dipertingkatkan oleh keuntungan tidak berulang berjumlah RM25.7 juta.

Lembaga Pengarah mengesyorkan dividen akhir sebanyak 5 sen sesaham tolak cukai, di mana berserta dengan dividen interim, akan menjadikan jumlah dividen sebanyak 10 sen sesaham. Dividen khas sebanyak RM1.20 sesaham tolak cukai telah dibayar pada bulan September 2009 sebagai sebahagian daripada rancangan Kumpulan untuk memulangkan kepada para pemegang saham lebihan tunai yang tidak diperlukan untuk operasinya.

Aktiviti Perniagaan

Penjualan kereta penumpang Mercedes-Benz meningkat sebanyak 6% kepada 1,600 unit pada tahun 2009, berbanding tahun 2008 yang mengalami kekurangan bekalan model C-Class. Pada tahun 2009, Kumpulan berjaya menghabiskan stok model E-Class sebelum pelancaran model baru pada suku terakhir tahun tersebut. Sambutan bagi E-Class baru adalah amat menggalakkan.

Kelembapan ekonomi telah membawa kepada peningkatan kempen-kempen pemasaran untuk menarik pelanggan kepada aktiviti selepas jualan, manakala langkah-langkah yang diambil untuk mengurangkan kos juga telah terbukti berkesan. Overhed korporat juga berkurangan kerana Kumpulan terus beroleh manfaat daripada penyusunan semula pada tahun sebelumnya.

Kakitangan

Saya ingin mengucapkan setinggi penghargaan kepada Dato’ Khalid atas khidmat dan sumbangan beliau kepada Kumpulan semenjak penganggotaan beliau dalam Lembaga Pengarah pada Februari 2003 sehingga persaraan beliau pada Disember 2009. Saya juga ingin mengalu-alukan penyertaan Datuk Syed Tamim yang telah dilantik menganggotai Lembaga Pengarah pada bulan Januari 2010.

Ucapan ribuan terima kasih juga ingin saya tujukan kepada semua kakitangan kita atas dedikasi dan usaha keras mereka sepanjang tempoh yang begitu mencabar ini. Saya juga ingin menyampaikan berbanyak terima kasih kepada para pelanggan, pemegang saham dan rakan kongsi perniagaan atas sokongan berterusan mereka.

Prospek

Unjuran bagi tahun 2010 adalah positif kerana keyakinan pengguna dijangka akan meningkat seiring dengan pemulihan ekonomi Malaysia. Walau bagaimanapun, risiko kemampanan pemulihan tersebut akan tetap wujud apabila pakej rangsangan ekonomi dimansuhkan secara beransur-ansur kelak.

Ben Keswick Pengerusi23 Februari 2010


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BOARD OF DIRECTORS

Benjamin William Keswick – Chairman

Mr Ben Keswick, aged 37, a British citizen, joined the Board on 1 April 2007 as a Non-Independent Non-Executive Director. He became Chairman of the Board on 25 April 2008. He is also Chairman of the Remuneration Committee and a member of the Nomination Committee. He is the Group Managing Director of the Jardine Cycle & Carriage Group. He has been with the Jardine Matheson Holdings Ltd since 1998, most recently as the Chief Executive Offi cer and before that, Finance Director of Jardine Pacifi c, which represents a number of Jardine Matheson Holdings Ltd’s non-listed interests in a range of industry sectors. He is a director of Jardine Matheson Holdings, Jardine Matheson Ltd, MCL Land Ltd and OHTL Public Company Ltd. He is also a Commissioner of PT Astra International Tbk and the Vice President Commissioner of PT United Tractors Tbk. Mr Keswick graduated from Newcastle University with a Bachelor of Science degree in Agricultural Economics and Food Marketing and obtained a Master of Business Administration from INSEAD.

Datuk Syed Tamim Ansari bin Syed Mohamed– Deputy Chairman appointed on 1 January 2010

Datuk Syed Tamim, aged 62, a Malaysian, joined the Board on 1 January 2010 as a Non-Independent Non-Executive Director. He was appointed as Deputy Chairman on the same date. He is currently the Group Country Chairman of Jardine Matheson Group of Companies in Malaysia, and Principal Consultant of ST&H Consultancy Services Sdn Bhd, a private company he established soon after his retirement in 2007. He is also an independent Non-Executive Board member of Integrax Berhad and Minetech Resources Berhad. He was a Board member of Maybank Berhad until September 2009. He has worked for more than 36 years in both public and private sectors. After obtaining his Economics Honours degree from the University of Malaya in 1972, he served the Administrative and Diplomatic Service until 1981. During his tenure with the government, he was sponsored to do his MBA which he obtained from the University of Oregon. He left the government to join PERNAS Group of Companies for 5 years. In 1986 he joined Sime Darby Berhad. In the 20 years stint with Sime, he headed various Divisions; Trading, Manufacturing, Oil and Gas, Engineering, Automotive, Tyres, Healthcare, and Plantations. Before he retired in July 2007, he headed the team that wrote and completed the Northern Corridor Economic Blueprint for the Government of Malaysia. He was trained in Japan, Australia and Harvard Business School which were all sponsored by Sime.

Dato’ Khalid bin Haji Ismail– Former Deputy Chairman resigned on 31 December 2009

Dato’ Khalid, aged 69, a Malaysian, became a Non-Independent Non-Executive Director on 24 February 2003 and was subsequently appointed Deputy Chairman on 10 March 2004. He held the post until his retirement from the Board on 31 December 2009. He was the Group Country Chairman of Jardine Matheson Group of Companies in Malaysia until his retirement on 31 December 2009. Previously, he held several senior positions in the Public Services Department, the Prime Minister’s Department, the Ministry of Finance and retired as Secretary-General of the Ministry of Culture, Arts and Tourism Malaysia. Dato’ Khalid holds a Bachelor of Arts (Honours) degree from University of Malaya and an MPA from University of Southern California, USA.

Tan Sri Dato’ Sulaiman bin Sujak

Tan Sri Dato’ Sulaiman, aged 76, a Malaysian, joined the Board as an Independent Non-Executive Director on 24 February 2003 and was appointed Chairman of the Nomination Committee and a member of the Audit Committee and Remuneration Committee on 26 April 2008. He has been with HSBC Bank Malaysia Berhad since 1989 and was an executive director and advisor from January 1994 to March 2004. He is now a non-executive and independent director of HSBC Bank Malaysia Berhad. A graduate of Royal Air Force College, Cranwell, England, Tan Sri Dato’ Sulaiman served both with the Royal Air Force and the Royal Malaysian Air Force and was the fi rst Malaysian Air Force Chief. He was an advisor (now known as Assistant Governor) of Bank Negara Malaysia and was the Commercial Director of Kumpulan Guthrie Berhad. He was also the Deputy Chairman of Malaysian Airline System Berhad for 24 years. He also sits on the board of FACB Industries Incorporated Berhad and Nationwide Express Courier Services Berhad.

Cheah Kim Teck

Mr Cheah, aged 58, a Singaporean, joined the Board on 2 February 2005 as a Non-Independent Non-Executive Director. He was appointed a member of the Audit Committee on 26 April 2008. He is the Chief Executive Offi cer of the Jardine Cycle & Carriage Group’s motor operations excluding those held by PT Astra International Tbk. In this capacity, he oversees the Group’s motor operations in Singapore, Malaysia, Thailand and Vietnam. He is a director of Jardine Cycle & Carriage Ltd and also a Commissioner of PT Tunas Ridean Tbk. He sits on the boards of Trek 2000, Mapletree Logistics Trust Management Ltd and Tote Board, and is a management committee member of the Singapore Turf Club. Prior to joining the group, he has held several senior marketing positions in multinational companies, namely McDonald’s Restaurant, Kentucky Fried Chicken and Coca-Cola. He holds a Master’s degree in Marketing from the University of Lancaster, United Kingdom.


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Vimala Menon

Ms Vimala Menon, aged 55, a Malaysian, joined the Board on 26 April 2008 as an Independent Non-Executive Director and was appointed Chairman of the Audit Committee on the same date. She is also a member of the Nomination Committee and the Remuneration Committee. Ms Menon, a Chartered Accountant, is an Associate Member of Institute of Chartered Accountants in England and Wales and a member of the Malaysian Institute of Accountants. She was the Director - Finance & Corporate Affairs of Proton Holdings Berhad from 2008 to 2009 and before that the Executive Director Finance & Corporate Services of EON Berhad from 1984 to 2007 and has served on the boards of EON Berhad from 1990 to 2006 and EON Bank Berhad from 1994 to 2004. She also served on the boards of Jardine Cycle & Carriage Limited from 1994 to 2003 and PT Astra International Tbk from 2000 to 2003.

Chiew Sin Cheok

Mr Chiew, aged 48, a Malaysian, is an alternate director to Mr Ben Keswick. He joined Jardine Cycle & Carriage Ltd as Group Finance Director on 1 November 2006. He has worked for the Jardine Matheson Group since 1993 where he has held various senior fi nance positions, prior to which he worked for Schroders and Pricewaterhouse, both in London. He is a Commissioner of PT Astra International Tbk and PT Astra Otoparts Tbk, Vice President Commissioner of PT Astra Agro Lestari Tbk and a member of the Audit Committee of PT Tunas Ridean Tbk. Mr Chiew graduated from the London School of Economics and Political Science with a Bachelor of Science (Economics) degree, obtained a Masters in Management Science degree from the Imperial College of Science and Technology, London, and is a member of the Institute of Chartered Accountants in England and Wales. He is on the Board of Governors of the Keswick Foundation, a charitable body in Hong Kong.

Ho Yeng Tat

Mr Ho, aged 54, a Singaporean, became the alternate director to Mr Cheah Kim Teck on 26 April 2008. He has been with Jardine Cycle & Carriage Limited since 1984 and is now the Group Company Secretary as well as Director of Group Corporate Affairs. He holds an LLB (Hons) degree and MBA from the National University of Singapore. He is also a graduate of the Association of Chartered Certifi ed Accountants, United Kingdom.

Mohkam Singh A/L Tara Singh

Mr Mohkam Singh, aged 58, a Malaysian, resigned as an alternate director to Dato’ Khalid on 31 December 2009 and was re-appointed as an alternate director to Datuk Syed Tamim on 1 January 2010. He is the Finance Director of Jardine Matheson (Malaysia) Sdn Bhd, a position he has held since April 1992. He previously held the position of Group Financial Controller of Jardine Transport Services, Malaysia and LK-NES (M) Sdn Bhd. He is a Fellow of the Association of Chartered Certifi ed Accountants, an associate of the Institute of Taxation (London) and a member of Malaysian Institute of Accountants.

Wong Kin Foo

Mr Wong, aged 43, a Malaysian, is the Chief Executive Offi cer of Cycle & Carriage Bintang, and is responsible for the Group’s motor operations in Malaysia. He has been with the Group since 1996 and last held the position of Chief Operating Offi cer.Mr Wong is an Associate Chartered Management Accountant, United Kingdom and is also a member of the Malaysian Institute of Accountants.

None of the directors has any family relationship with any director and/or substantial

shareholder; any confl ict of interest with the Company and any convictions for offences

within the past 10 years other than traffi c offences.


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CORPORATE GOVERNANCE STATEMENT

The Board of Directors fully supports the recommendations of the Malaysian Code on Corporate Governance (“Code”) which sets out the broad principles for good corporate governance and best practices for listed companies.

The Board is committed to applying the recommendations of the Malaysian Code on Corporate Governance to ensure that good corporate governance is practiced throughout the Group to effectively discharge its responsibilities to protect and enhance shareholder value.

The Company has in place a Board Charter that sets out, amongst others, the responsibilities, authorities, procedures and structures of the Board and Board Committees as well as the relationship between the Board with its management and shareholders.

Set out below is a statement of how the Group has applied the principles of the Code. The Board confi rms that the Group has complied with the best practices in the Code throughout the fi nancial year ended 31 December 2009.

The Board of Directors

The Board has overall responsibility for the strategic direction of the Group. The Board meets regularly to review corporate strategies, operations and the performance of business units within the Group. All Board members bring an independent judgement to bear on issues of strategy, performance, resources and standards of conduct.

During the fi nancial year ended 31 December 2009, four Board meetings were held. Set out below is the record of attendance of the Board members:

Directors Attendance

Benjamin William Keswick 4/4Dato’ Khalid bin Haji Ismail* 3/4Tan Sri Dato’ Sulaiman bin Sujak 4/4Cheah Kim Teck 4/4Vimala Menon 4/4

* Dato’ Khalid bin Haji Ismail resigned as a Non-Independent Non-Executive Deputy

Chairman of the Board on 31 December 2009 and was replaced by Datuk Syed Tamim

Ansari bin Syed Mohamed on 1 January 2010. Datuk Syed Tamim Ansari bin Syed

Mohamed was appointed as a Non-Independent Non-Executive Deputy Chairman of

the Board.

The Board has delegated specifi c responsibilities to three Board Committees, namely the Audit, Remuneration and Nomination Committees. These Committees have the authority to deal with particular issues and report to the Board with their recommendations, if any. The ultimate responsibility for the fi nal decision on the recommendations lies with the entire Board.

Board Balance

The Board currently has fi ve members, comprising two Independent Non-Executive Directors and three Non-Independent Non-Executive Directors. Together, the Directors bring a wide range of business and fi nancial experience relevant to the direction and objectives of the Group. A brief description of the background of each Director is presented on pages 6 to 7.

A clear division of responsibility between the Chairman and the Chief Executive Offi cer (“CEO”) exists to ensure a balance of power and authority. Formal position descriptions for the Chairman and the CEO outlining their respective roles and responsibilities are set out in the Board Charter. In the event that the Group does not have CEO, the Chief Operating Offi cer (“COO”) or such other person appointed by the Board shall have overall charge of the Group to the extent determined by the Board.

The composition of the Board is further balanced by the presence of Independent Non-Executive Directors. Although all Directors have equal responsibility for the Group’s business directions and operations, the role of these Independent Non-Executive Directors is particularly important in ensuring that the strategies proposed by the management are fully discussed and evaluated, having considered the long term interests of all interested parties, including the shareholders, employees, customers, suppliers and the community as a whole.

Vimala Menon, who is the Chairman of the Audit Committee, acts as the Senior Independent Non-Executive Director. Any concerns with regards to the Group may be conveyed to her.

The interests of major shareholders and minority shareholders are refl ected in the Board composition.


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Supply of Information

The management is duty bound to furnish the Board with all material information for the Board to discharge its responsibilities. In order for the Board to function effectively, matters for the Board’s consideration are presented to all the Directors with suffi cient time to enable the Directors to examine the issues and to obtain further explanation where necessary. As a general rule, Board papers are circulated for the Directors’ review at least fi ve days prior to any scheduled Board meeting. The Board papers include, among others, the following:

• Minutes of previous Board meeting• Minutes of meetings of Committees of the Board• Directors Circular Resolutions• Monthly performance report of the Group• Operational matters• Financial matters• Funding requirements• Business strategy matters• Project papers

There is a schedule of matters reserved specifi cally for the Board’s decision, including the approval of corporate plans and budgets, acquisition and disposal of major assets, major investments, changes to the management and control structure of the Group and issues in respect of key policies, procedures and authority limits.

The Board has also approved a procedure for Directors, whether as a full Board or in their individual capacity, to take independent advice, where necessary, at the Group’s expense in furtherance of their duties.

All Directors have access to the advice and services of the Company Secretary.

Appointments to the Board

The Malaysian Code on Corporate Governance endorses, as good practice, a formal procedure for appointments to the Board, with a nomination committee making recommendations to the Board. The Code, however, states that this procedure may be performed by the Board as a whole, although, as a matter of best practice, it recommends that this responsibility be delegated to a committee.

The Board has adopted the best practice and the Nomination Committee has been given the responsibility to recommend new appointments to the Board.

Nomination Committee

The present members of the Nomination Committee are:

• Tan Sri Dato’ Sulaiman bin Sujak (Chairman)• Benjamin William Keswick• Vimala Menon

This Committee met once during 2009. The meeting was attended by all members. All the members of this Committee are Non-Executive Directors and the majority is independent including the Chairman of the Committee.

The primary function of the Nomination Committee is to recommend to the Board candidates for directorships of the Company and its subsidiaries and Directors to fi ll the seats on Board Committees.

In addition, the Nomination Committee assesses the effectiveness of the Board, Board Committees and contributions of each individual Director. It also ensures an appropriate framework and plan for Board and management succession.

The Nomination Committee reviews annually and recommends to the Board the structure, size, balance and composition of the Board and Committees. This requires a review of the required mix of skills and experience including core competencies which Non-Executive Directors should bring to the Board and other qualities for the Board to function effectively and effi ciently.

Directors’ Training

As an integral part of the process of appointing new Directors, the Nomination Committee ensures that there is an orientation programme for new Board members. Directors also receive further training, from time to time, from professional bodies and training institutions.

In their effort to keep abreast with the changes in the industry, legislation and regulation affecting the Company, the Directors have in course of the year attended training programmes or talks in which the topics presented were in area of fi nance, leadership and economy.


10

CORPORATE GOVERNANCE STATEMENT

Re-election

In accordance with the Company’s Articles of Association, all Directors who are appointed by the Board during the year are subject to election by shareholders at the Annual General Meeting following their appointment. The Articles also provide that at least one third of the remaining Directors be subject to re-election by rotation at each Annual General Meeting and all Directors are to offer themselves for re-election once every three years.

Directors’ Remuneration

The Company is guided by the objectives as recommended by the Malaysian Code on Corporate Governance to determine the remuneration for Directors. Remuneration packages of management are structured so as to link rewards to the achievement of corporate and individual performance. In the case of Non-Executive Directors, the level of remuneration refl ects the level of responsibilities undertaken by the Directors.

Remuneration Procedure

The Remuneration Committee recommends to the Board the framework of executive remuneration and its cost, including the remuneration package for the CEO/COO. The Remuneration Committee also recommends the framework of fees payable to Non-Executive Directors. The Remuneration Committee may draw on the expertise of consultants before making recommendations to the Board. The fi nal decision on any remuneration package offered to the CEO/COO and the fees payable to Non-Executive Directors are the responsibilities of the entire Board.

Remuneration Committee

The present members of the Remuneration Committee are:

• Benjamin William Keswick (Chairman)• Tan Sri Dato’ Sulaiman bin Sujak• Vimala Menon

The Remuneration Committee had two meetings in 2009 which were attended by all members. All the members of this Committee are Non-Executive Directors and the majority is independent.

Remuneration Package

The remuneration packages of Directors and management are as follows:

(a) Basic Salary

The Remuneration Committee recommends the basic salary of the CEO/COO after having considered his performance. In the evaluation process, consideration is given to the salary scales for similar jobs in the industry.

(b) Directors’ Fees

Directors’ fees are only payable to Non-Executive Directors. The Remuneration Committee recommends the framework of Directors’ fees to the Board. The fees structure is determined after a study of comparable organisations’ practices or available professional studies/surveys as well as the level of responsibilities involved.

Non-Executive Directors receive annual fi xed fees based on the tenure of directorship and attendance fees based on attendances at Board and Committee meetings. The fees are paid quarterly in arrears.

(c) Bonus Scheme

The Group operates a bonus scheme for all employees, including the CEO/COO. The qualifi cation and eligibility for the scheme is linked to the performance of the Group’s business activities and an assessment of the employees’ performance and contribution. The CEO/COO’s bonus is dependent on the level of profi t achieved for the Group’s business activities against targets, together with an assessment of his performance during the year. Bonus payable to him is reviewed by the Remuneration Committee and approved by the Board.

(d) Benefi ts in Kind

Other customary benefi ts (such as car, driver, club membership, allowances, etc.) are made available as appropriate.

(e) Retirement Benefi ts

Contributions are made to the Employees Provident Fund, the national mandatory defi ned contribution plan, in respect of the CEO/COO. The rate of contribution is above the mandatory requirement in accordance with the Group’s employment scheme, available to all executive employees.

(f) Service Contract

There is currently no service contract with any Director.


11

Directors’ Remuneration

Directors’ fees of RM337,000 were paid to the fi ve Non-Executive Directors for the fi nancial year ended 31 December 2009.

The number of Directors whose remuneration fell within bands of RM50,000 is as follows:

Range of remuneration:

Less than RM50,000 1RM50,001– RM100,000 4

Policy on External Appointments

The Group recognises that its Directors may be invited to become directors of other companies and that exposure to other organisations can broaden the experience and knowledge of its Directors which will benefi t the Group. Directors are therefore at liberty to accept other board appointments so long as the appointment is not in confl ict with the business of the Group and does not adversely affect the Directors’ performance as a member of the Board. All such appointments must fi rst be discussed with the Chairman of the Board before being accepted.

Dialogue between the Company and Investors

The Group adheres strictly to the disclosure requirements under the listing requirements of Bursa Malaysia Securities Berhad. Results of the Group are announced quarterly to Bursa Malaysia Securities Berhad. In addition, material transactions and events are also announced accordingly.

The Group has established a website at www.ccb.com.my which shareholders can access for information.

Annual General Meeting

At each Annual General Meeting, the Board presents the performance of the business. The Chairman, CEO/COO and other Directors are available to respond to shareholders’ questions during the meeting.

Items of special business included in the notice of Annual General Meeting will be accompanied by a full explanation of the effects of a proposed resolution. Separate resolutions are proposed for separate issues at the meeting and the Chairman declares the number of proxy votes received both for and against each separate resolution where appropriate.

Financial Reporting

In presenting the annual fi nancial statements to shareholders and the announcements of quarterly fi nancial results, the Board aims to present a balanced assessment of the Group’s position and prospects.

Corporate Social Responsibility (“CSR”)

The Group’s CSR efforts in 2009 focused mainly on the employees’ well-being and the community. During the year, the Group continued with the Academic Excellence Awards Presentation which encourages and recognises the academic excellence of the children of the Group’s employees. The Group has also contributed to the less privileged communities such as the disabled and the aged.


12

STATEMENT OF INTERNAL CONTROL

Responsibility

The Board of Directors recognises the importance of sound internal controls and risk management practices to good corporate governance. The Board affi rms its overall responsibility for the Group’s systems of internal controls and risk management, and for reviewing the adequacy and effectiveness of the control and risk management systems. It should however be noted that such systems of internal controls are only designed to manage rather than totally eliminate risk of failure to achieve business objectives. Accordingly, such systems can only provide reasonable rather than absolute assurance against material losses, misstatements or other signifi cantly adverse consequences.

Risk Management Framework

The Group has in place a formal risk management process to identify, evaluate and manage signifi cant risks impacting the Group. The process is supported by policies as well as detailed procedures, methodologies, evaluation criteria and documentation requirements to ensure clarity and consistency of application across the Group.

The process requires management to comprehensively identify and assess all types of risks in terms of likelihood and magnitude of impact as well as to identify and evaluate the adequacy and application of mechanisms in place to manage, mitigate, avoid or eliminate these risks. The process encompasses assessments and evaluations at business unit process level before being examined on a Group perspective.

At least once a year, a written report is presented to the Audit Committee on the signifi cant risks impacting the Group and the measures taken by the management to address the risks. The report will also highlight residual exposures along with management action plan to manage or mitigate such exposures. Any internal or external changes that may signifi cantly impact the risks and control spectrum will also be highlighted. The Audit Committee will deliberate on the reports and advise the Board on signifi cant risk exposures.

Control Structure and Environment

The embedded control system is designed to facilitate achievement of the Group’s business objectives. It comprises the following:

• Organisation structure with well defi ned lines of

responsibility and delegated authority

The organisation structure includes defi ned delegation of responsibilities to the Committees of the Board, the Chief Executive or Chief Operating Offi cer and operating units through defi ned sets of terms of references, position descriptions and authorisation levels for all aspects of the business as set out in the Board Charter and Limits of

Authority. Besides the predominantly non-executive standing committees such as Audit, Nomination and Remuneration Committees, the Board is supported operationally by the Management Committee which consists of senior members of the organisation including the Chief Executive or Chief Operating Offi cer. The Management Committee convenes regularly to meet its strategic business agenda thus channelling the appropriate inputs to the Board for its assessment of the Group’s operations and the assertion of effective control over the entire operations.

• Independence of the Audit Committee

The Audit Committee comprises non-executive members of the Board, with the majority being Independent Directors. The Committee has full and unrestricted access to any information pertaining to the Group and has direct communication channels with the external and internal auditors. The primary objectives of the Audit Committee are to assist the Board in monitoring the Group’s management of its business and fi nancial risks and the determination of appropriate internal controls to manage these risks.

• Comprehensive budgeting and monitoring processes

Detailed and comprehensive budgets for both business and support units are prepared on an annual basis for approval by the Board together with an indication of future business directions under a two-year operating plan. Actual performance is monitored against the budget on a monthly basis and appropriate explanations documented for signifi cant variances. Periodical forecasts are also carried out frequently to update changes in business environment. Management Accounts packages detailing performance of business and support units against budget, forecast, prior year results and key business indicators are tabled and deliberated at the Management Committee and Board meetings for proper monitoring of performance.

Monitoring and Review

The effectiveness of the systems of internal control and risk management are monitored through periodical review of business processes, the state of internal control and business risk profi le by operating units. The results of the review will be examined by a team within the organisation and after due processes, the management will identify signifi cant areas to be reported to the Audit Committee.

Independent appraisals by internal auditors also ensure compliance with policies, procedures, standards and legislation and give reasonable assurance of the effectiveness of the Group’s systems of internal controls and risk management.


13

The Audit Committee of the Board of Directors was formed in 1977. The present members of the Committee are:

• Vimala Menon (Chairman)• Tan Sri Dato’ Sulaiman bin Sujak• Cheah Kim Teck

The members of the Audit Committee consist solely of Non-Executive Directors, the majority of whom are independent. The independent members are Vimala Menon as Chairman and Tan Sri Dato’ Sulaiman bin Sujak as member. The Non-Independent Director is Cheah Kim Teck.

The Committee had four meetings during the year. The meetings were attended by all members. Members of senior management attended these meetings upon invitation by the Chairman of the Committee. The Group’s internal and external auditors attended all the meetings during the period.

Set out below is the record of attendance of the Audit Committee members:

Audit Committee Members Attendance

Vimala Menon 4/4Tan Sri Dato’ Sulaiman bin Sujak 4/4Cheah Kim Teck 4/4

The terms of reference of the Audit Committee are set out in pages 14 to 15.

During the fi nancial year, the Audit Committee carried out its duties as set out in the terms of reference. In particular, the functions of the Audit Committee are to review accounting policies, internal controls, statutory fi nancial statements and related party transactions of the Company and its subsidiary companies on behalf of the Board of Directors.

In performing its functions, the Audit Committee reviewed the overall scope of internal audit. It met with the Group’s internal auditors to discuss the results of their examinations and their evaluation of the system of internal controls of the Company and its subsidiary companies.

In addition, the Audit Committee discussed with the external auditors the audit plan which states the nature and scope of audit and the results of examination arising from the external audit.

The Audit Committee also reviewed the quarterly announcements to Bursa Malaysia Securities Berhad (“BMSB”) and the fi nancial statements of the Company and the consolidated fi nancial statements of the Group as well as the statutory auditors’ report thereon. The Audit Committee recommended to the Board of Directors, subject to the shareholders’ approval, the selection of the Company’s and its subsidiary companies’ statutory auditors.

In its endeavour to fulfi ll its responsibilities, the Audit Committee focused its attention on key aspects of business operations that have signifi cant impact not only on profi tability but also the quality of services provided to customers.

Other main issues discussed by the Audit Committee are as follows:

• Review of the Group’s risk management reports;• The new Financial Reporting Standards issued by the

Malaysian Accounting Standards Board and their applicability to the consolidated fi nancial statements for the fi nancial year ended 31 December 2009; and

• The disclosure requirements of the Main Market Listing Requirements of BMSB.

Internal Audit Function

The Group uses the services of the Jardine Matheson Group Internal Auditors to accomplish its internal audit requirements. The Group Internal Auditors report to the Audit Committee on matters concerning the Group and assists the Board of Directors in monitoring and managing risks and internal controls.

The Group Internal Auditors review internal controls in all key activities of the Group and recommend improvement in controls and procedures. The Group Internal Auditors are independent of the activities they audit and perform with impartiality and due professional care. Findings of the Group Internal Auditors are reported regularly to the Audit Committee.

The Audit Committee approves the internal audit plan of the Group Internal Auditors each year. The scope of the internal audit covers the audits of signifi cant units and operations, including subsidiaries. In addition, the Group Internal Auditors also audit the various computer application systems and network of the Group.

During the year the management worked hand in hand with the Group Internal Auditors in identifying risk areas, implementing control measures and monitoring controls. The monitoring process will form the basis for continually improving the risk management process in the context of the Group’s overall goals.

In the course of auditing, the Group Internal Auditors have identifi ed some minor internal control weaknesses during the period, which have been or are being addressed. None of the weaknesses have resulted in any material losses, contingencies or uncertainties that would require disclosure in the Group’s Annual Report.

AUDIT COMMITTEE REPORT


14

AUDIT COMMITTEE TERMS OF REFERENCE

Purpose

The Audit Committee is established as a committee of the Board of Directors. The primary objectives of the Audit Committee are to:

1. Provide assistance to the Board in fulfi lling its statutory and fi duciary responsibilities to review the Company and its subsidiaries (“the Group”) and monitoring the Group’s management of business/fi nancial risk processes and accounting and fi nancial reporting practices;

2. Determine that the Group has adequate administrative, operational and internal accounting controls and that the Group is operating in accordance with its prescribed procedures, codes of conduct and applicable legal and regulatory requirements;

3. Serve as an independent and objective party in the review of the fi nancial information presented by management for distribution to shareholders and the general public; and

4. Provide direction and oversight over the internal audit function and the external auditors to enhance their independence from management.

Membership

The Audit Committee must have at least three members. All the members must be non-executive directors and fi nancially literate with a majority of them being independent directors. The chairperson of the Committee shall be an independent director.

At least one member of the Committee, preferably an independent director, must meet the criteria set by the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“BMSB”) (Paragraph 15.09(1)(c)).

Audit Committee members and the chairperson must be appointed by the Board based on the recommendations of the Nomination Committee. No alternate directors shall be appointed to the Audit Committee.

If a member of the Committee resigns, dies or for any reason ceases to be a member resulting in non-compliance with the above paragraphs, the Board must, within three (3) months of that event, appoint such number of new members as may be required.

The Audit Committee shall have no executive powers.

Committee’s Operating Principles

The Audit Committee wherever necessary and reasonable for the performance of its duties, shall in accordance with the procedures determined by the Board and at the cost of the Group:

1. Have authority to investigate any matter within its terms of reference;

2. Have the resources which are required to perform its duties;

3. Have full and unrestricted access to any information pertaining to the Group;

4. Have direct communication channels with the external auditors and internal auditors;

5. Be able to obtain independent professional advice or other advice; and

6. Be able to convene meetings with the external auditors, the internal auditors or both, excluding the attendance of other directors and employees of the Company, whenever deemed necessary.

Meetings

The Committee shall meet at least four (4) times each year. Additional meetings shall be scheduled as considered necessary by the Committee or chairperson. The Committee may establish procedures from time to time to govern its meetings, keeping of minutes and its administration.

The Committee may request other directors, members of management, counsels, internal auditors and external auditors, as applicable to participate in Committee meetings, as necessary, to carry out the Committee’s responsibilities. It shall be understood that either internal or external auditors, may, at any time, request a meeting with the Audit Committee with or without management attendance.

The external auditors shall be given notice of meetings and shall have the right to attend and speak.

At least twice a year, the Committee shall meet with the external auditors without the presence of executive Board members.

The Secretary of the Committee shall be appointed by the Committee from time to time. Committee meeting agendas shall be the responsibility of the Committee chairperson with input from Committee members. The chairperson may also ask management to participate in this process. The agenda for each meeting shall be circulated at least fi ve days before each meeting to the Committee members, the external auditors and all those who are required to attend the meeting. Written materials including information requested by the Committee from management, internal audit and external auditors shall be received together with the agenda for the meetings.


15

The Committee shall cause minutes to be duly entered in the books provided for the purpose of all resolutions and proceedings of all meetings of the Committee. Such minutes shall be signed by the chairperson of the meeting at which the proceedings were held or by the chairperson of the next succeeding meeting and if so signed, shall be conclusive evidence without any further proof of the facts thereon stated. Minutes of each meeting shall also be distributed to all attendees (members) of the Audit Committee meeting and external auditors.

The Committee, through its chairperson, shall report to the Board after each meeting. The minutes of the Committee meeting shall be available to all Board members.

Circular Resolutions signed by all the members shall be valid and effective as if it had been passed at a meeting of the Audit Committee.

Scope of Activities

The duties of the Audit Committee shall include the following:

1. To recommend appointment of the external auditors and their fees and consider any questions of resignation or dismissal including whether there is reason (supported by grounds) to believe that the external auditors are not suitable for re-appointment;

2. To review the external auditors’ proposed scope and approach before the audit commences and ensure co-ordination where more than one audit fi rm is involved;

3. To review the quarterly fi nancial announcements and year-end fi nancial statements of the Group, prior to the approval by the Board, focusing particularly on:

• changes in or implementation of major accounting policies;

• signifi cant and unusual events;

• signifi cant adjustments arising from the audit;

• going concern assumption; and

• compliance with accounting standards and other legal requirements.

4. To discuss problems and reservations arising from interim and fi nal audits and any matter the auditor may wish to discuss (in the absence of management where necessary) including assistance given by employees of the Group to the auditor;

5. To review with the external auditors, their evaluation of the system of internal controls, including any signifi cant suggestions for improvements and management’s response;

6. To review with the external auditors, their audit report;

7. To review the Group’s business risk management process, including adequacy of the Group’s overall control environment and controls in selected areas representing signifi cant fi nancial and business risk;

8. To do the following where an internal audit function exists:

• review the adequacy of the scope, function, competency and resources of the internal audit function and that it has the necessary authority to carry out its work;

• review the internal audit programme, process and results of the internal audit programme, processes or investigation undertaken and where necessary ensure that appropriate action is taken on the recommendations of the internal audit function;

• ensure that the internal audit function is independent of the activities it audits; the internal audit function should be free from interference in determining the scope of internal audit, performing work and communicating results; and

• ensure that the internal audit function reports directly to the Committee.

9. To review any related party transactions and confl ict of interest situation that may arise within the Group including any transaction, procedure or course of conduct that raises questions of management integrity;

10. To review the major fi ndings of internal investigations and management’s response;

11. To review management’s monitoring of compliance with the Group’s code of corporate conduct;

12. To review with the Group’s counsels, any legal matters that could have a signifi cant impact on the Group’s fi nancial statements;

13. To verify at the end of each fi nancial year, the allocation of options under a share scheme for employees to ensure compliance with the allocation criteria determined by the Remuneration Committee and in accordance with the Bye-Laws of the relevant Option Scheme. A statement by the Committee verifying such allocation shall be included in the annual report;

14. To review the fi ndings of any investigation by regulatory authorities;

15. Where the Audit Committee is of the view that a matter

reported by it to the Board has not been satisfactorily resolved resulting in a breach of BMSB’s requirements, the Audit Committee must promptly report such matters to BMSB; and

16. Perform other oversight functions as requested by the Board.


16

ADDITIONAL COMPLIANCE INFORMATION

In compliance with the Main Market Listing Requirements of Bursa Malaysia Securities Berhad (“BMSB”), the following information is provided:

Non-Statutory Audit Fees

The amount of non-statutory audit fees paid and payable to the external auditors by the Company and its subsidiaries for the fi nancial year ended 31 December 2009 are as follows:

PricewaterhouseCoopers RM24,000PricewaterhouseCoopers Taxation Services Sdn Bhd RM44,000Total RM68,000

Material Contracts

Neither the Company nor any of its subsidiaries have entered into any contracts which are or may be material (not being contracts entered into in the ordinary course of business) involving Directors’ and major shareholders’ interests since the end of the previous fi nancial year.

Recurrent Related Party Transactions

The Company had at the Annual General Meeting held on 21 April 2009 obtained a shareholders’ mandate for the Group to enter into recurrent transactions of a revenue or trading nature, which are necessary for its day to day operations and are in the ordinary course of business, with related parties. The said general mandate has been in effect from 21 April 2009 until the conclusion of the forthcoming Annual General Meeting of the Company. The Company intends to seek a renewal of the said general mandate for recurrent related party at the forthcoming Annual General Meeting of the Company.

The details of the new mandate to be sought have been furnished in the Circular to Shareholders dated 5 April 2010 attached to this Annual Report.

Details of related party transactions are disclosed in Note 29 to the fi nancial statements, of which none of the aggregate value of transactions conducted pursuant to the shareholders’ mandate during the fi nancial year is equal to or exceeds the applicable prescribed threshold under Chapter 10 of the Main Market Listing Requirements of BMSB.

Sanctions or Penalties

During the fi nancial year, there were no sanctions and/or penalties imposed on the Company and its subsidiaries, Directors or management by the relevant regulatory bodies.

STATEMENT OF DIRECTORS’ RESPONSIBILITY FOR PREPARING THE FINANCIAL STATEMENTS

The Directors are required by the Companies Act, 1965 to prepare fi nancial statements for each fi nancial year which have been made out in accordance with the applicable approved accounting standards and give a true and fair view of the state of affairs of the Group and of the Company at the end of the fi nancial year and of the results and cash fl ows of the Group and of the Company for the fi nancial year.

In preparing the fi nancial statements, the Directors have:

• selected suitable accounting policies and applied them consistently;

• made judgements and estimates that are reasonable and prudent;

• ensured that all applicable accounting standards have been followed; and

• prepared fi nancial statements on the going concern basis as the Directors have a reasonable expectation, having made enquiries, that the Group and the Company have adequate resources to continue operations for the foreseeable future.

The Directors acknowledge the responsibility for ensuring that the Company keeps accounting records which disclose with reasonable accuracy the fi nancial position of the Group and of the Company and which enable them to ensure that the fi nancial statements comply with the Companies Act, 1965.

The Directors have overall responsibilities for taking such steps as are reasonably open to them to safeguard the assets of the Group, to prevent and detect fraud and other irregularities.


17

STATUTORY FINANCIAL STATEMENTS

18 Directors’ Report

22 Statement by Directors

22 Statutory Declaration

23 Independent Auditors’ Report

24 Consolidated Income Statement

25 Consolidated Balance Sheet

26 Consolidated Statement of

Changes in Equity

27 Consolidated Cash Flow Statement

28 Company Income Statement

29 Company Balance Sheet

30 Company Statement of

Changes in Equity

31 Company Cash Flow Statement

32 Summary of Significant

Accounting Policies

38 Notes to the Financial Statements


18

DIRECTORS’ REPORT

The directors submit their Annual Report to the members together with the audited fi nancial statements of the Group and of the Company for the fi nancial year ended 31 December 2009.

Principal Activities

The principal activities of the Group and of the Company consist of the retailing of motor vehicles, sales of spare parts and servicing of vehicles. There was no signifi cant change in the nature of these activities during the fi nancial year.

Financial Results

Group Company RM’000 RM’000

Profi t before tax 30,505 43,502Tax expense (6,862) (9,989)Profi t for the year from continuing operations 23,643 33,513Profi t for the year from discontinued operations 4,486 4,486Profi t attributable to equity holders 28,129 37,999

Dividends

The dividends paid or declared by the Company since 31 December 2008 were as follows:

RM’000

In respect of the fi nancial year ended 31 December 2008, as shown in the Directors’ report for the year, fi nal gross dividend of 5 sen per share on 100,744,500 ordinary shares, less income tax, paid on 19 June 2009 3,778

In respect of the fi nancial year ended 31 December 2009: Interim gross dividend of 5 sen per share on 100,744,500 ordinary shares, less income tax, paid on 18 September 2009 3,778

Special gross dividend of 120 sen per share on 100,744,500 ordinary shares, less income tax, paid on 18 September 2009 90,670 98,226

The directors now recommend the payment of a fi nal gross dividend of 5 sen per share on 100,744,500 ordinary shares, less income tax, amounting to RM3,778,000 which, subject to the approval of members at the forthcoming Annual General Meeting of the Company, will be paid on 25 June 2010 to shareholders whose names appear in the Company’s Register of Members and Record of Depositors on 31 May 2010.

Reserves and Provisions

Material transfers to or from reserves and provisions during the fi nancial year are shown in the fi nancial statements.

Directors

The directors who have held offi ce during the period since the date of the last report are:

Benjamin William KeswickTan Sri Dato’ Sulaiman bin SujakCheah Kim TeckVimala A/P V.R. MenonChiew Sin Cheok (Alternate director to Benjamin William Keswick)Ho Yeng Tat (Alternate director to Cheah Kim Teck)Datuk Syed Tamim Ansari bin Syed Mohamed (appointed on 1.1.2010)

Mohkam Singh A/L Tara Singh (Alternate director to Dato’ Khalid bin Haji Ismail) (resigned on 31.12.2009)

(Alternate director to Datuk Syed Tamim Ansari bin Syed Mohamed) (appointed on 1.1.2010)

Dato’ Khalid bin Haji Ismail (resigned on 31.12.2009)


19

Directors (continued)

In accordance with the Company’s Articles of Association, Benjamin William Keswick retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for re-election.

In accordance with the Company’s Articles of Association, Datuk Syed Tamim Ansari bin Syed Mohamed retires under casual vacancy at the forthcoming Annual General Meeting and, being eligible, offers himself for re-election.

In accordance with Section 129 of the Companies Act 1965, Tan Sri Dato’ Sulaiman bin Sujak being over seventy years of age, retires at the forthcoming Annual General Meeting and offers himself for re-appointment.

Directors’ Benefi ts

During and at the end of the fi nancial year, no arrangements subsisted to which the Company is a party, with the object or objects of enabling directors of the Company to acquire benefi ts by means of the acquisition of shares in or debentures of the Company or any other body corporate.

Since the end of the previous fi nancial year, no director has received or become entitled to receive a benefi t (other than those disclosed in Note 5 and Note 29(c) to the fi nancial statements) by reason of a contract made by the Company or a related corporation with the director other than share options or with a fi rm of which he is a member, or with a company in which he has a substantial fi nancial interest.

Directors’ Interests in Shares

According to the register of directors’ shareholdings, particulars of interests of directors who held offi ce at the end of the fi nancial year in the shares and options over shares in the Company and its related corporations were as follows:

Number of ordinary shares

At At 1.1.2009 Acquired Sold 31.12.2009

Shares in Jardine Cycle & Carriage Limited (“JCCL”) held by:Cheah Kim Teck 20,189 0 0 20,189Ho Yeng Tat 51,833 0 (17,000) 34,833

Options over ordinary shares

At At 1.1.2009 Granted Exercised 31.12.2009

Options in JCCL held by:Ho Yeng Tat 20,000 0 0 20,000

Number of ordinary shares of US$0.25 each


Shares in Jardine Matheson Holdings Limited (“JMHL”) held by:Benjamin William Keswick 2,315,643 18,543 (100,000) 2,234,186Benjamin William Keswick # 37,503,225 207,518 (288,000) 37,422,743

# Deemed interest in shares held by family trusts in which Benjamin William Keswick is a benefi ciary.


20

DIRECTORS’ REPORT

At 31 December 2009, Benjamin William Keswick had deemed interests in 35,915,991 ordinary shares in JMHL as discretionary objects under the 1947 Trust, the income of which is available for distribution to senior executive offi cers and employees of JMHL and its wholly owned subsidiaries.

Options over ordinary shares of US$0.25 each

At At 1.1.2009 Granted Exercised 31.12.2009

Options in JMHL held by:Benjamin William Keswick 300,000 0 0 300,000Chiew Sin Cheok 20,000 0 0 20,000

Number of ordinary shares of £0.05 each


Shares in Jardine Lloyd Thompson Group Plc held by:Benjamin William Keswick 1,349 0 0 1,349

None of the other directors who held offi ce at the end of the fi nancial year held any interest in shares in the Company or its related corporations during the fi nancial year.

Statutory Information on the Financial Statements

Before the income statements and balance sheets 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 satisfi ed themselves that all known bad debts had been 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 in the ordinary course of business their values as shown in the accounting records of the Group and of the Company had been written down to an amount which they might be expected so to realise.

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

(a) which would render the amounts written off for bad debts or the amount of the allowance for doubtful debts in the fi nancial statements of the Group and of the Company inadequate to any substantial extent; or

(b) which would render the values attributed to current assets in the fi nancial statements of the Group and of the Company misleading; or

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

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 fi nancial year which, in the opinion of the directors, will or may substantially affect the ability of the Group or of the Company to meet their obligations when they fall due.

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

(a) any charge on the assets of the Group or of the Company which has arisen since the end of the fi nancial year which secures the liability of any other person; or

(b) any contingent liability of the Group or of the Company which has arisen since the end of the fi nancial year.

At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this report or the fi nancial statements which would render any amount stated in the fi nancial statements misleading.


21

Statutory Information on the Financial Statements (continued)

In the opinion of the directors,

(a) the results of the Group’s and of the Company’s operations during the fi nancial year were not substantially affected by any item, transaction or event of a material and unusual nature; and

(b) there has not arisen in the interval between the end of the fi nancial year and the date of this report any item, transaction or event of a material and unusual nature likely to affect substantially the results of the operations of the Group or of the Company for the fi nancial year in which this report is made.

Ultimate Holding Company

The directors regard Jardine Matheson Holdings Limited, a company incorporated in Bermuda, as the Company’s ultimate holding company.

Auditors

The auditors, PricewaterhouseCoopers, have expressed their willingness to continue in offi ce.

Signed on behalf of the Board of Directors in accordance with their resolution dated 23 February 2010.

Benjamin William Keswick Vimala A/P V.R. MenonDirector Director


22

We, Benjamin William Keswick and Vimala A/P V.R. Menon, two of the directors of Cycle & Carriage Bintang Berhad, state that, in the opinion of the directors, the fi nancial statements set out on pages 24 to 62 are drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company as at 31 December 2009 and of the results and cash fl ows of the Group and of the Company for the fi nancial year ended on that date in accordance with the Financial Reporting Standards, MASB Approved Accounting Standards in Malaysia for Entities Other than Private Entities and the provisions of the Companies Act, 1965.

Signed on behalf of the Board of Directors in accordance with their resolution dated 23 February 2010.

Benjamin William Keswick Vimala A/P V.R. MenonDirector Director

STATUTORY DECLARATION

Pursuant to Section 169(16) of the Companies Act, 1965

I, Wong Yee Ying, the offi cer primarily responsible for the fi nancial management of Cycle & Carriage Bintang Berhad, do solemnly and sincerely declare that the fi nancial statements set out on pages 24 to 62 are, in my opinion, correct, and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the Statutory Declarations Act, 1960.

Wong Yee Ying

Subscribed and solemnly declared by the abovenamed Wong Yee Ying.

At: Kuala Lumpur

On: 23 February 2010

Before me:

Commissioner for Oaths

STATEMENT BY DIRECTORS

Pursuant to Section 169(15) of the Companies Act, 1965


23

INDEPENDENT AUDITORS’ REPORT

To the Members of Cycle & Carriage Bintang Berhad (Company No. 7378 D)

Report on the Financial Statements

We have audited the fi nancial statements of Cycle & Carriage Bintang Berhad, which comprise the balance sheets as at 31 December 2009 of the Group and of the Company, and the income statements, statements of changes in equity and cash fl ow statements of the Group and of the Company for the fi nancial year then ended, and a summary of signifi cant accounting policies and other explanatory notes, as set out on pages 24 to 62.

Directors’ Responsibility for the Financial Statements

The Directors of the Company are responsible for the preparation and fair presentation of these fi nancial statements in accordance with the Financial Reporting Standards, MASB Approved Accounting Standards in Malaysia for Entities Other than Private Entities and the Companies Act 1965. This responsibility includes: designing, implementing and maintaining internal control relevant to the preparation and fair presentation of fi nancial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditors’ Responsibility

Our responsibility is to express an opinion on these fi nancial statements based on our audit. We conducted our audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the fi nancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial statements. The procedures selected depend on our judgement, including the assessment of risks of material misstatement of the fi nancial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Company’s preparation and fair presentation of the fi nancial statements 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 Company’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Directors, as well as evaluating the overall presentation of the fi nancial statements.

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

Opinion

In our opinion, the fi nancial statements have been properly drawn up in accordance with the Financial Reporting Standards, MASB Approved Accounting Standards in Malaysia for Entities Other than Private Entities and the Companies Act 1965 so as to give a true and fair view of the fi nancial position of the Group and of the Company as of 31 December 2009 and of their fi nancial performance and cash fl ows for the fi nancial year then ended.

Report on Other Legal Regulatory Requirements

In accordance with the requirements of the Companies Act 1965 in Malaysia, we also report the following:

(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiaries have been properly kept in accordance with the provisions of the Act.

(b) We are satisfi ed that the accounts of the subsidiaries that have been consolidated with the Company’s fi nancial statements are in form and content appropriate and proper for the purposes of the preparation of the fi nancial statements of the Group and we have received satisfactory information and explanations required by us for those purposes.

(c) Our audit reports on the accounts of the subsidiaries did not contain any qualifi cation or any adverse comment made under Section 174(3) of the Act.

Other Matters

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

PricewaterhouseCoopers Jayarajan A/L U. Rathinasamy(No. AF: 1146) (No. 2059/06/10 (J))Chartered Accountants Chartered Accountant

Kuala Lumpur23 February 2010


24

CONSOLIDATED INCOME STATEMENT

For the fi nancial year ended 31 December 2009

Note 2009 2008 RM’000 RM’000

CONTINUING OPERATIONS

REVENUE 4 466,320 513,090Cost of sales (412,607) (452,246)Gross profi t 53,713 60,844

Other operating income– dividend income 11,229 11,229– income from investment 0 18,714– rental income 3,576 2,525– gain on disposal of properties 28 0 12,460– others 7,241 5,086Selling and distribution costs (26,380) (33,833)Administrative expenses (18,356) (20,871)Other operating expenses 0 (8,245)OPERATING PROFIT 31,023 47,909

FINANCE COST – interest expense on borrowings (509) (719)SHARE OF (LOSS)/PROFIT OF AN ASSOCIATED COMPANY 14 (9) 127PROFIT BEFORE TAX 30,505 47,317TAX EXPENSE 6 (6,862) (688)PROFIT FOR THE YEAR FROM CONTINUING OPERATIONS 23,643 46,629

DISCONTINUED OPERATIONS

PROFIT FOR THE YEAR FROM DISCONTINUED OPERATIONS 7 4,486 156PROFIT FOR THE YEAR 8 28,129 46,785

PROFIT ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANY 28,129 46,785

Basic earnings per share attributable to the equity holders of the Company (sen):– profi t for the year from continuing operations 10 23.5 46.3

– profi t for the year 10 27.9 46.4

The accounting policies on pages 32 to 37 and the notes on pages 38 to 62 form an integral part of these fi nancial statements.


25

As at 31 December 2009 Note 2009 2008 RM’000 RM’000

NON-CURRENT ASSETSProperty, plant and equipment 11 68,864 73,224Leasehold land use rights 12 11,391 11,618Investment in an associated company 14 & 27 195 204Investment in unquoted shares 15 66,003 66,003Deferred tax assets 16 1,037 2,608 147,490 153,657

CURRENT ASSETSInventories 17 53,600 62,179Tax recoverable 232 1,269Trade and other receivables 18 43,831 60,445Bank balances and deposits 20 28,427 58,766 126,090 182,659Non-current assets held for sale 7 0 250 126,090 182,909TOTAL ASSETS 273,580 336,566

CURRENT LIABILITIESProvisions for liabilities and charges 21 963 1,391Current tax liabilities 934 126Trade and other payables 22 83,563 106,832Borrowings (unsecured) 23 30,000 0 115,460 108,349TOTAL LIABILITIES 115,460 108,349NET ASSETS 158,120 228,217

EQUITY

CAPITAL AND RESERVES ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANYShare capital 24 100,745 100,745Share premium 23,857 23,857Revaluation reserve 8,463 8,463Retained profi ts 25,055 95,152TOTAL EQUITY 158,120 228,217


CONSOLIDATED BALANCE SHEET


26


Attributable to equity holders of the Company

Issued and fully paid ordinary shares of RM1 each

Number Nominal Share Revaluation Retained of shares value premium reserve profi ts Total ’000 RM’000 RM’000 RM’000 RM’000 RM’000

At 1 January 2009 100,745 100,745 23,857 8,463 95,152 228,217

Profi t for the year 0 0 0 0 28,129 28,129

Dividends for the fi nancial year ended: – 31 December 2008 0 0 0 0 (3,778) (3,778)

– 31 December 2009 0 0 0 0 (94,448) (94,448)

At 31 December 2009 100,745 100,745 23,857 8,463 25,055 158,120


Issued and fully paid ordinary shares of RM1 each


At 1 January 2008 100,745 100,745 23,857 12,433 150,535 287,570 Share of exchange difference arising on consolidation 0 0 0 0 (1) (1)Revaluation surplus on property, plant and equipment during the fi nancial year 0 0 0 1,962 0 1,962Realisation of revaluation surplus on disposal of property, plant and equipment 0 0 0 (5,932) 5,932 0

(Loss)/income recognised directly in equity 0 0 0 (3,970) 5,931 1,961Profi t for the year 0 0 0 0 46,785 46,785Total (loss)/income for the year 0 0 0 (3,970) 52,716 48,746

Dividends for the fi nancial year ended: – 31 December 2007 0 0 0 0 (3,728) (3,728) – 31 December 2008 0 0 0 0 (104,371) (104,371)At 31 December 2008 100,745 100,745 23,857 8,463 95,152 228,217


CONSOLIDATED STATEMENT OF CHANGES IN EQUITY


27

CONSOLIDATED CASH FLOW STATEMENT


Note 2009 2008 RM’000 RM’000

OPERATING ACTIVITIESNet cash fl ow from operations 26 32,092 126,674

Interest paid (522) (1,324)Interest received 1,095 1,301Taxation (paid)/refunded (4,941) 145Retrenchment/voluntary separation benefi ts paid 0 (5,971)Warranty and other provisions utilised (235) (256) (4,603) (6,105)Net cash fl ow from operating activities 27,489 120,569

INVESTING ACTIVITIESProceeds from disposal of property, plant and equipment 370 33,131Purchase of property, plant and equipment (1,201) (5,389)Interim capital distribution from an associated company 0 450Proceeds from disposal of subsidiaries 0 23,181Dividend income 11,229 11,229Income from investment 0 18,714Net cash fl ow from investing activities 10,398 81,316

FINANCING ACTIVITIESRevolving credits and bankers acceptance 30,000 (49,479)Dividends paid (98,226) (108,099)Net cash fl ow used in fi nancing activities (68,226) (157,578)

NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS DURING THE FINANCIAL YEAR (30,339) 44,307CASH AND CASH EQUIVALENTS AT BEGINNING OF FINANCIAL YEAR 58,766 14,459CASH AND CASH EQUIVALENTS AT END OF FINANCIAL YEAR 20 28,427 58,766



28

COMPANY INCOME STATEMENT


Note 2009 2008 RM’000 RM’000

CONTINUING OPERATIONS

REVENUE 4 415,343 453,244Cost of sales (366,452) (400,184)Gross profi t 48,891 53,060

Other operating income– dividend income 11,229 11,229– income from investment 0 18,714– rental income 3,996 3,343– dividend income from subsidiary companies 14,027 0– gain on disposal of properties 28 0 12,460– others 7,006 4,072Selling and distribution costs (23,599) (30,249)Administrative expenses (17,539) (18,687)Other operating expenses 0 (11,221)OPERATING PROFIT 44,011 42,721

FINANCE COST – interest expense on borrowings (509) (719)PROFIT BEFORE TAX 43,502 42,002

TAX EXPENSE 6 (9,989) (366)PROFIT FOR THE YEAR FROM CONTINUING OPERATIONS 33,513 41,636

DISCONTINUED OPERATIONS

PROFIT/(LOSS) FOR THE YEAR FROM DISCONTINUED OPERATIONS 7 4,486 (652)PROFIT FOR THE YEAR 8 37,999 40,984



29

COMPANY BALANCE SHEET

As at 31 December 2009 Note 2009 2008 RM’000 RM’000

NON-CURRENT ASSETSProperty, plant and equipment 11 67,738 72,707Leasehold land use rights 12 13,246 13,473Investments in subsidiary companies 13 & 27 31,654 31,654Investment in an associated company 14 & 27 0 0Investment in unquoted shares 15 66,003 66,003Deferred tax assets 16 986 2,461 179,627 186,298

CURRENT ASSETSInventories 17 48,451 57,230Tax recoverable 0 1,141Trade and other receivables 18 40,206 55,530Amounts due from subsidiary companies 19 4,896 386Bank balances and deposits 20 26,386 56,322 119,939 170,609Non-current assets held for sale 7 0 250 119,939 170,859TOTAL ASSETS 299,566 357,157

CURRENT LIABILITIESProvisions for liabilities and charges 21 890 1,259Current tax liabilities 934 0Trade and other payables 22 78,462 99,104Amounts due to subsidiary companies 19 26,147 33,434Borrowings (unsecured) 23 30,000 0 136,433 133,797TOTAL LIABILITIES 136,433 133,797NET ASSETS 163,133 223,360

EQUITY

CAPITAL AND RESERVES ATTRIBUTABLE TO EQUITY HOLDERS OF THE COMPANYShare capital 24 100,745 100,745Share premium 23,857 23,857Revaluation reserve 7,446 7,446Retained profi ts 25 31,085 91,312TOTAL EQUITY 163,133 223,360



30

COMPANY STATEMENT OF CHANGES IN EQUITY



Issued and fully paid ordinary shares of RM1 each Non-Distributable Distributable


At 1 January 2009 100,745 100,745 23,857 7,446 91,312 223,360

Profi t for the year 0 0 0 0 37,999 37,999

Dividends for the fi nancial year ended: – 31 December 2008 0 0 0 0 (3,778) (3,778)

– 31 December 2009 0 0 0 0 (94,448) (94,448)

At 31 December 2009 100,745 100,745 23,857 7,446 31,085 163,133


Issued and fully paid ordinary shares of RM1 each Non-Distributable Distributable


At 1 January 2008 100,745 100,745 23,857 11,416 152,495 288,513

Revaluation surplus on property, plant and equipment during the fi nancial year 0 0 0 1,962 0 1,962Realisation of revaluation surplus on disposal of property, plant and equipment 0 0 0 (5,932) 5,932 0(Loss)/income recognised directly in equity 0 0 0 (3,970) 5,932 1,962Profi t for the year 0 0 0 0 40,984 40,984Total (loss)/income for the year 0 0 0 (3,970) 46,916 42,946

Dividends for the fi nancial year ended: – 31 December 2007 0 0 0 0 (3,728) (3,728) – 31 December 2008 0 0 0 0 (104,371) (104,371)At 31 December 2008 100,745 100,745 23,857 7,446 91,312 223,360



31

COMPANY CASH FLOW STATEMENT

For the fi nancial year ended 31 December 2009 Note 2009 2008 RM’000 RM’000

OPERATING ACTIVITIESNet cash fl ow from operations 26 20,667 158,261

Interest paid (522) (1,273)Interest received 1,095 1,301Taxation paid (4,427) (203)Retrenchment/voluntary separation benefi ts paid 0 (5,971)Warranty and other provisions utilised (234) (250) (4,088) (6,396)Net cash fl ow from operating activities 16,579 151,865

INVESTING ACTIVITIESProceeds from disposal of property, plant and equipment 420 31,972Purchase of property, plant and equipment (458) (2,315)Proceeds from disposal of subsidiaries 0 690Interim capital distribution from an associated company 0 450Dividends from subsidiary companies 10,520 0Dividend income 11,229 11,229Income from investment 0 18,714Net cash fl ow from investing activities 21,711 60,740

FINANCING ACTIVITIESRevolving credits and bankers acceptance 30,000 (59,000)Dividends paid (98,226) (108,099)Net cash fl ow used in fi nancing activities (68,226) (167,099)

NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS DURING THE FINANCIAL YEAR (29,936) 45,506CASH AND CASH EQUIVALENTS AT BEGINNING OF FINANCIAL YEAR 56,322 10,816CASH AND CASH EQUIVALENTS AT END OF FINANCIAL YEAR 20 26,386 56,322



32

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES


Unless otherwise stated, the following accounting policies have been applied consistently to all the years presented in dealing with items which are considered material in relation to the fi nancial statements.

A Basis of Preparation

The consolidated fi nancial statements have been prepared in accordance with the provisions of the Companies Act, 1965 and Financial Reporting Standards, the MASB Approved Accounting Standards in Malaysia for Entities Other than Private Entities. The consolidated fi nancial statements have been prepared under the historical cost convention, except as disclosed in the accounting policies below.

The preparation of fi nancial statements in conformity with the Financial Reporting Standards and the provisions of the Companies Act, 1965 requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the fi nancial statements, and the reported amounts of revenues and expenses during the reported period. It also requires management to exercise its judgement in the process of applying the Group’s accounting policies. Although these estimates and judgement are based on the directors’ best knowledge of current events and actions, actual results could differ from these estimates.

The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are signifi cant to the fi nancial statements, are disclosed in Note 3.

(a) Standards, amendments to published standards and interpretations to existing standards that are not yet effective

and have not been early adopted

The new standards, amendments to published standards and interpretation that are mandatory for the Group’s fi nancial periods beginning on or after 1 January 2010, but which the Group has not early adopted, are as follows:

• Revised FRS 3 – Business Combinations. • FRS 7 – Financial Instruments: Disclosures. • FRS 8 – Operating Segments. • FRS 101 – Presentation of Financial Statements. • Revised FRS 127 – Consolidated and Separate Financial Statements. • FRS 139 – Financial Instruments: Recognition and Measurement. • Amendments to FRS 139 – Reclassifi cation of Financial Assets. • Amendments to FRS 139 – Eligible Hedged Items. • Amendments to IC Interpretation 9 and FRS 139 – Embedded Derivatives. • Amendments to FRS 1 and FRS 127 – Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate. • Amendments to FRS 132 and FRS 101 – Puttable Financial Instruments and Obligations Arising on Liquidation. • IC Interpretation 9 – Reassessment of Embedded Derivatives. • IC Interpretation 10 – Interim Financial Reporting and Impairment. • IC Interpretation 13 – Customer Loyalty Programmes.

(b) Standards, amendments to published standards and interpretation to existing standards that are not yet effective

and not relevant for the Group’s operations

• FRS 4 – Insurance Contracts. • FRS 123 – Borrowing Costs. • Amendments to FRS 2 – Share-based Payments: Vesting Conditions and Cancellations. • IC Interpretation 11 FRS 2 – Group and Treasury Share Transactions. • IC Interpretation 12 – Service Concession Arrangements. • IC Interpretation 14 FRS 119 – The Limit on a Defi ned Benefi t Asset, Minimum Funding Requirements and their Interaction. • IC Interpretation 15 – Agreements for Construction of Real Estate. • IC Interpretation 16 – Hedges of a Net Investment in a Foreign Operation. • IC Interpretation 17 – Distributions of Non-cash Assets to Owners.

B Basis of Consolidation

The consolidated fi nancial statements made up to 31 December include the audited fi nancial statements of the Company and all its subsidiary companies.

Subsidiary companies are consolidated from the date of acquisition up to the date of disposal using the acquisition method of accounting. All intercompany transactions, balances and unrealised surpluses and defi cits on transactions between group companies have been eliminated. Where necessary, accounting policies for subsidiary companies have been changed to ensure consistency with the policies adopted by the Group.


33

C Subsidiary Companies

Subsidiaries are all entities over which the Group has the power to govern the fi nancial and operating policies generally accompanying a shareholding of more than 50% of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases.

Investments in subsidiary companies are stated in the fi nancial statements of the Company at cost less allowance for any accumulated impairment losses. Impairment in value of an investment is recognised as an expense in the period in which the impairment is identifi ed.

A listing of the Group’s subsidiary companies is set out in Note 27.

D Associated Companies

Associates are all entities over which the Group has signifi cant infl uence, but no control, generally accompanying a shareholding of between 20% and 50% of the voting rights. Investments in associates are accounted for in the consolidated fi nancial statements using the equity method of accounting and are initially recorded at cost. The Group’s investment in associates includes goodwill (net of any accumulated impairment losses) identifi ed on acquisition. When the Group’s share of losses in an associate equals or exceeds its interest in the associate, including any other unsecured receivables, the Group does not recognise further losses, unless the Group has incurred obligations or made payments on behalf of the associate.

Signifi cant unrealised gains on transactions between the Group and its associates are eliminated to the extent of the Group’s interest in the associate. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred. Adjustments have been made where necessary to ensure consistency with the policies adopted by the Group.

The details of the Group’s associated company are shown in Note 27.

E Investments

Unquoted investments are stated at cost and provision for diminution in value is only made where in the opinion of the directors, there is a reduction in carrying amount which is other than a temporary decline.

On disposal of an investment, the difference between the net disposal proceeds and its carrying amount is charged/credited to the income statement.

F Property, Plant and Equipment

Freehold land is stated at valuation. Freehold buildings and the building component of owner-occupied leasehold properties are stated at valuation less accumulated depreciation and impairment losses where applicable. Independent valuations are performed every three years on an open market basis, and in the case of building component of leasehold properties, on the basis of depreciated replacement cost. Depreciated replacement cost is used as the most reliable basis of allocating open market value to the building component. In the intervening years, the directors review the carrying values and adjustment is made where there has been a material change. Any accumulated depreciation on the date of revaluation is eliminated against the gross carrying amount of the assets and the net amount is restated to the revalued amount of the assets. Revaluation surpluses and defi cits are dealt in asset revaluation reserves, except for movements on individual properties below depreciated cost which are dealt with in the income statement. All other assets are stated at historical cost less depreciation and impairment losses.

Freehold land is not depreciated. Buildings are depreciated using the straight line method over their estimated useful economic lives or the estimated remaining period of the lease, whichever is shorter. All other property, plant and equipment are depreciated on a straight line basis to write-off the cost of each asset to their residual values over their estimated useful lives at the following annual rates:

Buildings 3 1/3% – 20%Plant and machinery 14% – 33%Motor vehicles, equipment and fi xtures 10% – 33%

Depreciation on assets under construction commences when the assets are ready for their intended use.


34



F Property, Plant and Equipment (continued)

The residual value, useful lives and depreciation method of property, plant and equipment are reviewed at each balance sheet date. An asset’s carrying amount is written down immediately to its recoverable amount if the asset carrying amount is greater than its estimated recoverable amount.

On disposal of property, plant and equipment, the difference between the net disposal proceeds and the carrying amount is credited or charged to the income statement in determining profi t from operations. The revaluation surplus on land and buildings is transferred directly to retained earnings on sale of the property.

G Leasehold Land Use Rights

Leasehold land use rights are payments to acquire long term interests in owner-occupied property. Leasehold land use rights acquired by way of a business combination are measured at their fair values at the acquisition date. For subsequent measurement, leasehold land use rights are amortised over the useful life of the lease which includes the renewal period if the lease can be renewed without signifi cant cost. The estimated useful lives range from 61 to 91 years.

H Non-current Assets (or Disposal Groups) Classifi ed as Held for Sale

Non-current assets (or disposal groups) are classifi ed as assets held for sale and stated at the lower of carrying amount and fair value less costs to sell if their carrying amount is recovered principally through a sale transaction rather than through a continuing use.

I Impairment of Assets

Assets that have an indefi nite useful life are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events of changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use.

For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifi able cash fl ows (cash-generating units). Non-fi nancial assets other than goodwill that suffered impairment are reviewed for possible reversal of the impairment at each reporting date. The impairment loss is charged to the income statement unless it reverses a previous revaluation in which case it is charged to the revaluation reserve. Impairment loss on goodwill is not reversed. In respect of other assets, any subsequent increase in recoverable amount is recognised in the income statement unless it reverses an impairment loss on a revalued asset in which case it is taken to revaluation reserve.

J Operating Leases

Accounting by lessee

Leases of assets where a signifi cant portion of the risks and rewards of ownership are retained by the lessor are classifi ed as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on the straight line basis over the lease period.

K Inventories

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

Cost is generally determined using the fi rst in, fi rst out method except for spare parts, where cost is determined on the weighted average method. Work-in-progress and cost of locally assembled vehicles include direct materials, labour and an appropriate proportion of production overheads.

Net realisable value is the estimate of the selling price in the ordinary course of business, less the estimated costs of completion and selling expenses. Allowances are made where necessary for obsolete, slow-moving and defective stocks.

L Trade Receivables

Trade receivables are carried at invoice amount less allowance for doubtful debts. The allowance is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. The amount of the allowance is the difference between the carrying amount and the recoverable amount.

Bad debts are written off when it is established that they are irrecoverable.


35

M Income Taxes

Current tax expense is provided based on the tax payable on the income for the fi nancial year that is chargeable to tax.

Deferred income tax is recognised in full, using the liability method, on temporary differences arising between the amounts attributed to assets and liabilities for tax purposes and their carrying amounts in the fi nancial statements. The principal temporary differences arise from depreciation on property, plant and equipment, revenue received in advance, impairment of assets, revaluations of certain non-current assets, provisions for pensions and other post-retirement benefi ts, and tax losses carried forward; and in relation to acquisitions, on the difference between the fair values of the net assets acquired and their tax bases.

Deferred tax assets are recognised for temporary differences which will result in deductible amounts in future periods, carry-forward of unused tax losses and tax credits but only to the extent that it is probable that taxable profi t will be available against which these temporary differences, losses or tax credits can be utilised.

Deferred tax is recognised on temporary differences arising on investments in subsidiaries, associated companies and joint ventures except where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

N Foreign Currencies

(1) Functional and presentation currency

The fi nancial statements are presented in Ringgit Malaysia, which is the Company’s functional and presentation currency.

(2) Transactions and balances

Foreign currency monetary assets and liabilities have been converted into Ringgit Malaysia at the rates of exchange ruling at the balance sheet date. Transactions in foreign currencies have been converted at rates ruling at the transaction dates. Exchange differences arising from the settlement of foreign currency transactions and from the translation of foreign currency monetary assets and liabilities are included in the income statements.

O Revenue Recognition

Revenue comprises the fair value of the consideration received or receivable for the sale of goods and services in the ordinary course of the Group’s activities. Revenue is shown net of sales and service taxes, excise duties, and is stated net of discounts and after eliminating sales within the Group. The Group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefi ts will fl ow to the entity.

Interest income and return on investment are recognised in the income statement on a time-proportion basis unless collection is in doubt.

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

P Cash and Cash Equivalents

For the purposes of the cash fl ow statement, cash and cash equivalents comprise cash in hand, deposits held at call with banks and short term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignifi cant risk of changes in value, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the balance sheet.

Q Share Capital

(1) Classifi cation

Ordinary shares are classifi ed as equity.

(2) Dividends

Interim dividends are accounted for in shareholders’ equity as an appropriation of retained earnings in the period in which they are declared whilst fi nal dividends are accounted for when approved by shareholders at the Annual General Meeting.


36


R Employee Benefi ts

(1) Short term employee benefi ts

Wages, salaries, paid annual leave and sick leave, bonuses, and non-monetary benefi ts are accrued in the period in which the associated services are rendered by employees of the Group.

(2) Defi ned contribution plan

The Group’s contributions to the Employees’ Provident Fund, a defi ned contribution plan regulated and managed by the government, are charged to the income statement in the period to which they relate. Once the contributions have been paid, the Group has no further fi nancial obligations.

(3) Termination benefi ts

Termination benefi ts are payable whenever an employee’s employment is terminated before the normal retirement date or whenever an employee accepts voluntary redundancy in exchange for these benefi ts. The Group recognises termination benefi ts when it is demonstrably committed to either terminate the employment of current employees according to a detailed formal plan without possibility of withdrawal or to provide termination benefi ts as a result of an offer made to encourage voluntary redundancy. Benefi ts falling due more than 12 months after balance sheet date are discounted to present value.

S Financial Instruments

(1) Description

A fi nancial instrument is any contract that gives rise to both a fi nancial asset of one enterprise and a fi nancial liability or equity instrument of another enterprise.

A fi nancial asset is any asset that is cash, a contractual right to receive cash or another fi nancial asset from another enterprise, a contractual right to exchange fi nancial instruments with another enterprise under conditions that are potentially favourable, or an equity instrument of another enterprise.

A fi nancial liability is any liability that is a contractual obligation to deliver cash or another fi nancial asset to another enterprise, or to exchange fi nancial instruments with another enterprise, or to exchange fi nancial instruments with another enterprise under conditions that are potentially unfavourable.

(2) Financial instruments recognised on the balance sheet

Financial instruments carried on the balance sheet include cash and bank balances, receivables, investments, payables and borrowings. The particular recognition methods adopted are disclosed in the individual policy statements associated with each item.

(3) Financial instruments not recognised on the balance sheet

The Group is also a party to fi nancial instruments that reduce exposure to fl uctuations in foreign currency exchange. These instruments, which mainly comprise foreign currency forward contracts, are not recognised in the fi nancial statements on inception.

The Group entered into foreign currency forward contracts to protect the Group from movements in exchange rates by establishing the rate at which a foreign currency asset or liability will be settled. Any increase or decrease in the amount required to settle the asset or liability is offset by a corresponding movement in the value of the foreign currency forward contract. The gains and losses are therefore offset for fi nancial reporting purposes and are not recognised in the fi nancial statements.

(4) Fair value estimation for disclosure purposes

The fair value of publicly traded investments is based on quoted market prices at the balance sheet date. The fair value of forward foreign exchange contracts is determined using forward exchange market rates at the balance sheet date.

In assessing the fair value of other fi nancial instruments, the Group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance sheet date. Estimated discounted value of future cash fl ows are used to determine fair value for investment in unquoted shares.

The face values of fi nancial assets (less any estimated credit adjustments) and fi nancial liabilities with a maturity period of less than one year are assumed to approximate their fair values. The fair values of fi nancial assets and liabilities with a maturity period of more than one year are disclosed in the notes to the fi nancial statement.



37

T Segment Reporting

Business segments provide products or services that are subject to risks and returns that are different from those of other business segments. Geographical segments provide products or services within a particular economic environment that is subject to risks and returns that are different from those components operating in other economic environments.

Segment revenue, expense, assets and liabilities are those amounts resulting from the operating activities of a segment that are directly attributable to the segment and the relevant portion that can be allocated on a reasonable basis to the segment. Segment revenue, expense, assets and segment liabilities are determined before intragroup balances and intragroup transactions are eliminated as part of the consolidation process, except to the extent that such intragroup balances and transactions are between group enterprises within a single segment.

U Provisions

Provisions for service and warranty, retrenchment benefi t and legal claims are recognised when: the Group has a present legal or constructive obligation as a result of past events; it is more likely than not that an outfl ow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognised for future operating losses.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax rate that refl ects current market assessment of the time value of money and the risks specifi c to the obligation. The increase in the provision due to passage of time is recognised as interest expense.

V Borrowings

Borrowings are initially recognised based on the proceeds received, net of transaction costs incurred. In subsequent periods, borrowings are stated at amortised cost using the effective yield method; any difference between proceeds (net of transaction costs) and the redemption value is recognised in the income statement over the period of the borrowings.

Borrowings are classifi ed as current liabilities unless they are due at least 12 months after the balance sheet date.


38


1 General Information

The principal activities of the Group and of the Company consist of the retailing of motor vehicles, sales of spare parts and servicing of vehicles. There was no signifi cant change in the nature of these activities during the fi nancial year.

The ultimate holding company of the Company is Jardine Matheson Holdings Limited, a company incorporated in Bermuda.

The holding company of the Company is Jardine Cycle & Carriage Limited, a company incorporated in Singapore.

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

The address of the registered offi ce of the Company is as follows:

Level 18, The Gardens North TowerMid Valley CityLingkaran Syed Putra59200 Kuala Lumpur

The address of the principal place of business of the Company is as follows:

Lot 19, Jalan 51A/21946100 Petaling JayaSelangor Darul Ehsan

2 Financial Risk Management Objectives and Policies

The Group’s activities expose it to a variety of fi nancial risks, including interest rate risk, credit risk, liquidity and cash fl ow risk. The Group’s overall fi nancial risk management objective is to ensure that the Group creates value for its shareholders. Financial risk management is carried out through risk reviews, internal control systems and adherence to Group fi nancial risk management policies. The Board regularly reviews these risks and approves the treasury policies, which covers the management of these risks.

Interest rate risk

The Group is exposed to interest rate risk through the impact of rate changes on interest bearing borrowings. The risk is mitigated by entering into interest rate cap contracts.

Credit risk

Credit risk arises when sales are made on deferred credit terms. The Group has no signifi cant concentrations of credit risk. The Group seeks to control credit risk by setting counterparty limits and ensuring that sales of products and services are made to customers with an appropriate credit worthiness.

Liquidity and cash fl ow risk

The Group adopts prudent liquidity risk management by maintaining suffi cient cash and an adequate amount of available committed credit facilities.

3 Critical Accounting Estimates and Judgement

Estimates and judgements used in preparing the fi nancial statements are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable. The resulting accounting estimates will, by defi nition, seldom equal the related actual results. The estimates and assumptions that have a signifi cant effect on the carrying amounts of assets and liabilities are discussed below.

(a) Service and warranty

The Group and the Company provide servicing and warranties on vehicles sold under specifi c warranty terms. A provision is made for expected warranty claims based on past service history or potential obligation to maintain brand image.

Factors that could impact the estimated warranty claim include the quality of the products distributed, as well as parts and labour costs.

NOTES TO THE FINANCIAL STATEMENTS


39

3 Critical Accounting Estimates and Judgement (continued)

(b) Income taxes

Signifi cant judgement is required in determining the provision for income taxes. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for anticipated tax audit issues based on estimates of whether additional taxes will be due. Where the fi nal tax outcome of these matters is different from the amounts that were initially recorded, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made.

Recognition of the deferred tax assets, which principally relate to tax losses, depends on the management’s expectation of future taxable profi t that will be available against which the tax losses can be utilised. The outcome of their actual utilisation may be different.

4 Revenue

Revenue of the Group and of the Company comprise sales of motor vehicles, spare parts and servicing of motor vehicles, excluding sales and service taxes, excise duties and net of discounts.

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Sales of motor vehicles and spare parts 446,253 489,533 397,730 432,462 Servicing of motor vehicles 20,067 23,557 17,613 20,782 466,320 513,090 415,343 453,244

5 Directors’ Remuneration

The emoluments receivable by directors of the Company during the fi nancial year were as follows:

Group and Company

2009 2008 RM’000 RM’000

Non-executive Directors: – fees 337 429

Executive Director: – salaries and bonus 0 1,450 – estimated value of benefi ts-in-kind @ 0 120 – defi ned contribution retirement plan @ 0 73 337 2,072

@ The amounts include amount payable to Jardine Matheson & Co., Ltd of RM Nil (2008: RM135,000).

6 Tax Expense

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Continuing Operations

Current tax 5,291 4,533 8,514 4,184 Deferred tax 1,571 (3,845) 1,475 (3,818) 6,862 688 9,989 366

Discontinued Operations

Current tax 1,495 106 1,495 0


40


6 Tax Expense (continued)

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000


Current tax: – current year 5,538 4,699 8,765 4,284 – benefi t from previously unrecognised temporary differences and tax losses 0 (2) 0 0 – over accrual in prior years (net) (247) (164) (251) (100)

Deferred tax: – origination and reversal of temporary differences 1,571 (3,845) 1,475 (3,818) 6,862 688 9,989 366


Current tax: – current year 1,495 106 1,495 0

The effective tax rates of the Group and of the Company differ from the prevailing statutory income tax rate of 25% (2008: 26%) due to the following:

Group Company

2009 2008 2009 2008 % % % %

Malaysian tax rate 25 26 25 26 Tax effects of: – expenses not deductible for tax purposes 3 1 3 1 – income not subject to tax (5) (25) (5) (26) – prior year over provision (1) 0 (1) 0 – others 1 0 1 0 Average effective tax rate 23 2 23 1

7 Discontinued Operations and Non-current Assets Held for Sale

(I) Discontinued Operations

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Discontinuance of the Mercedes-Benz wholesale business operation (Note 7(I)(a)) 4,486 (1,100) 4,486 (1,100) Discontinuance of the assembly operation (Note 7(I)(b)) 0 (6) 0 0 Discontinuance of the Peugeot business operation (Note 7(l)(c)) 0 780 0 0 Discontinuance of the Mazda business operation (Note 7(l)(d)) 0 963 0 448 Discontinuance of the Parts & Truck business operations (Note 7(l)(e)) 0 (481) 0 0 Profi t/(loss) for the year from discontinued operations 4,486 156 4,486 (652)



41

7 Discontinued Operations and Non-current Assets Held for Sale (continued)

(I) Discontinued Operations (continued)

(a) Discontinued Mercedes-Benz Wholesale Business Operation

As disclosed in prior fi nancial years, the Company ceased to have the rights to the Mercedes-Benz wholesale business with effect from 1 January 2003. The discontinuance of the wholesale business affects the automobile industry business segment.

The results attributable to the discontinued Mercedes-Benz wholesale business operation during the fi nancial year were as follows:

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Revenue 0 0 0 0 Other income/(expenses) excluding tax 5,981 (1,100) 5,981 (1,100) Profi t/(loss) before tax 5,981 (1,100) 5,981 (1,100) Tax expense (1,495) 0 (1,495) 0 Profi t/(loss) after tax 4,486 (1,100) 4,486 (1,100)

The other income of RM5,981,000 for the fi nancial year ended 31 December 2009 is in respect of the duty drawback received during the fi nancial year.

The cash fl ows attributable to the discontinued Mercedes-Benz wholesale business operation during the fi nancial year were as follows:

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Operating activities 5,981 0 5,981 0

(b) Discontinued Assembly Operation

As disclosed in prior fi nancial years, Asia Automobile Industries Sendirian Berhad (“AAI”), and Srisari Sdn. Bhd. (“Srisari”), both wholly owned subsidiaries of the Company has each entered into an agreement with MBM for an early termination of the assembly operation.

The results attributable to the discontinued assembly operation during the fi nancial year were as follows: Group

2009 2008 RM’000 RM’000

Revenue 0 0 Expenses excluding tax 0 (6) Loss before tax 0 (6) Tax expense 0 0 Loss after tax 0 (6)

The cash fl ows attributable to the discontinued assembly operation during the fi nancial year were as follows: Group

2009 2008 RM’000 RM’000

Operating activities 0 (9)


42




(c) Discontinued Peugeot Business Operation

On 25 October 2007, the Group announced that its wholly owned subsidiary, Cycle & Carriage Automobiles Sendirian Berhad had notifi ed Automobiles Peugeot (“AP”) that it would not be renewing its agreement with AP for the distribution of Peugeot vehicles in Malaysia, which had expired on 31 December 2007.

The results attributable to the discontinued Peugeot business operation during the fi nancial year were as follows:

Group

2009 2008 RM’000 RM’000

Revenue 0 4,400 Expenses excluding tax 0 (3,620) Profi t before tax 0 780 Tax expense 0 0 Profi t after tax 0 780

The cash fl ows attributable to the discontinued Peugeot business operation during the fi nancial year were as follows:

Group

2009 2008 RM’000 RM’000

Operating activities 0 (396) Investing activities – Proceeds from disposal of plant and equipment 0 323 Total cash fl ow 0 (73)

The net gain on disposal of equipment attributable to the discontinued Peugeot business operation during the fi nancial year was as follow:

Group

2009 2008 RM’000 RM’000

Proceeds from disposal 0 323 Net book value of equipment 0 (301) Gain on disposal 0 22

(d) Discontinued Mazda Business Operation

On 29 February 2008, the Group entered into a share sale agreement with Bermaz Motor Sdn Bhd, a wholly owned subsidiary of Berjaya Corporation Berhad, for the disposal of the wholesale and retail business of the Mazda franchise in Malaysia via the disposal of its wholly owned subsidiary, Hercules Automotive Engineers Sendirian Berhad.

The sale was completed on 1 April 2008 and the Group subsequently ceased to be in the business of distribution and retail of Mazda vehicles in Malaysia.



43



(d) Discontinued Mazda Business Operation (continued)

The results attributable to the discontinued Mazda business operation during the fi nancial year were as follows:

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Revenue 0 22,795 0 5,020 Expenses excluding tax 0 (21,826) 0 (4,572) Profi t before tax 0 969 0 448 Tax expense 0 (6) 0 0 Profi t after tax 0 963 0 448

The cash fl ows attributable to the discontinued Mazda business operation during the fi nancial year were as follows:

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Operating activities 0 1,308 0 0 Investing activities: – Purchase of plant and equipment 0 (2,222) 0 0 – Proceeds from disposal of plant and equipment 0 794 0 0 Total cash fl ow 0 (120) 0 0

The net loss on disposal of equipment attributable to the discontinued Mazda business operation during the fi nancial year was as follows:

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Proceeds from disposal 0 794 0 0 Net book value of equipment 0 (981) 0 0 Loss on disposal 0 (187) 0 0

(e) Discontinued Parts & Truck Business Operations

On 18 July 2008, the Group entered into a share sale agreement with Mikani Holdings Sdn Bhd (“Purchaser”) for the disposal of the Company’s wholly owned subsidiaries, Cycle & Carriage Motors Sdn Bhd, Cycle & Carriage Parts and Accessories Sdn Bhd and Asia Automobile Industries Sendirian Berhad.

The sale was completed on 22 July 2008 and the Group subsequently ceased its Parts & Truck businesses.


44




(e) Discontinued Parts & Truck Business Operations (continued)

The results attributable to the discontinued parts & truck business operations during the fi nancial year were as follows:

Group

2009 2008 RM’000 RM’000

Revenue 0 16,522 Expenses excluding fi nance cost and tax 0 (16,853) Loss before fi nance cost and tax 0 (331) Finance cost 0 (50) Loss before tax 0 (381) Tax expense 0 (100) Loss after tax 0 (481)

The cash fl ows attributable to the discontinued parts & truck business operations during the fi nancial year were as follows:

Group

2009 2008 RM’000 RM’000

Operating activities 0 (383) Investing activities: – Purchase of plant and equipment 0 (834) – Proceeds from disposal of plant and equipment 0 65 Total cash fl ow 0 (1,152)

The net gain on disposal of equipment attributable to the discontinued parts & truck business operations during the fi nancial year was as follows:

Group

2009 2008 RM’000 RM’000

Proceeds from disposal 0 65 Net book value of equipment 0 (63) Gain on disposal 0 2

(II) Non-current assets held for sale

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Property, plant and equipment 0 250 0 250

At 1 January 250 10,332 250 10,332 Transfer from property, plant and equipment (Note 11) 0 7,675 0 7,675 Disposals (250) (17,757) (250) (17,757) At 31 December 0 250 0 250



45

8 Profi t for the Year

(a) Expenses by nature: Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Defi ned contribution pension plan 2,989 3,458 2,648 2,874 Salaries, bonus and other employee benefi ts costs 23,880 33,158 21,511 28,408 Write-down of inventories 1,842 515 1,751 447 Reversal of write-down of inventories made in previous year (Note 17) (764) (1,721) (702) (598) Costs of inventories/materials/consumables 402,802 479,847 357,630 395,165 Demonstration car expenses 3,005 4,371 2,722 3,998 Depreciation of property, plant and equipment (Note 11) 5,031 5,846 4,846 5,486 Impairment of property, plant and equipment (Note 11) 474 18 474 18 Amortisation of leasehold land use rights (Note 12) 227 227 227 227 Utilities 2,098 2,512 1,925 2,255 Repairs and maintenance 1,653 2,692 1,540 2,494 Delivery, packing and travelling 1,212 1,989 1,031 1,474 Advertising, marketing and promotion 1,967 1,497 1,747 1,213 Leasing of equipment 818 1,001 714 861 Directors’ fees 337 429 337 429 Auditors’ remuneration @ 279 331 221 256 Credit card charges 584 525 524 524 Printing and stationery 372 569 325 490 Company car expenses 787 1,059 744 860 Legal and professional fees 1,593 876 1,541 806 Security guard expenses 807 1,057 743 930 Revaluation defi cit of properties (Note 11) 0 2,154 0 2,154 Payment/provision for retrenchment/ voluntary separation benefi ts 0 5,485 0 4,985 Amount due from subsidiaries written-off 0 0 0 3,026 Rent for land and buildings 4,297 4,620 4,197 4,496 Other expenses 1,569 6,819 1,410 2,735 Total expenses * 457,859 559,334 408,106 466,013

* Total expenses consist of cost of sales, selling and distribution costs, administrative expenses and other operating expenses arising from

continuing and discontinued operations.

@ The following information relates to remuneration of auditors of the Group and of the Company during the fi nancial year:

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

PricewaterhouseCoopers Malaysia

Statutory audit 211 209 172 167 Fees for other services: – non-statutory audit related services 24 58 24 58 – tax advisory and compliance work 44 61 25 28 – other services 0 3 0 3 Total remuneration 279 331 221 256


46


8 Profi t for the Year (continued)

(b) The following amounts have been credited in arriving at profi t for the year: Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Dividend income 11,229 11,229 11,229 11,229 Income from investment 0 18,714 0 18,714 Dividend income from subsidiary companies 0 0 14,027 0 Gain on disposal of property, plant and equipment (Note 26) 64 11,645 63 11,833 Interest income (Note 26) 1,095 1,301 1,095 1,301 Insurance commission income 1,576 1,565 1,493 1,301

9 Dividends

Dividends declared or proposed in respect of the fi nancial years ended 31 December 2009 and 2008 are as follows: Group and Company

2009 2008

Amount of Amount of Gross dividend Gross dividend per share net of tax per share net of tax Sen RM’000 Sen RM’000

Interim dividend paid 5 3,778 5 3,728 Special dividend paid 120 90,670 135 100,643 Final dividend proposed 5 3,778 5 3,778 130 98,226 145 108,149

At the forthcoming Annual General Meeting on 27 April 2010, a fi nal gross dividend in respect of the fi nancial year ended 31 December 2009 of 5 sen per share (2008: 5 sen per share), less income tax, amounting to RM3,778,000 (2008: RM3,778,000) will be proposed for shareholders’ approval. These fi nancial statements do not refl ect this fi nal dividend which will be accounted for as an appropriation of retained profi ts and accrued as a liability in the fi nancial year ending31 December 2010 when approved by shareholders of the Company.

10 Earnings per Share

Basic earnings per share is calculated by dividing the Group profi t attributable to equity holders of the Company for the fi nancial year by the weighted average number of ordinary shares in issue during the fi nancial year.

Group

2009 2008

Profi t for the year attributable to equity holders of the Company (RM’000) 28,129 46,785 Weighted average number of ordinary shares in issue (’000) 100,745 100,745

Basic earnings per share (sen) 27.9 46.4

Profi t attributable to equity holders of the Company from continuing operations (RM’000) 23,643 46,629

Basic earnings per share from continuing operations (sen) 23.5 46.3

No diluted EPS is computed for the Group as there is no dilutive potential ordinary shares in issue.



47

11 Property, Plant and Equipment

Motor Plant vehicles, and equipment Freehold land Buildings machinery and fi xtures Total Group RM’000 RM’000 RM’000 RM’000 RM’000

2009

Net book value at 1 January 30,150 31,137 1,295 10,642 73,224

Additions 0 268 466 467 1,201

Disposals 0 0 0 (56) (56)

Depreciation charge (Note 8) 0 (1,356) (462) (3,213) (5,031)

Impairment loss (Note 8) 0 (87) (2) (385) (474)

Net book value at 31 December 30,150 29,962 1,297 7,455 68,864

At cost 0 0 8,497 25,321 33,818

At valuation 30,150 31,469 0 0 61,619

Accumulated depreciation 0 (1,420) (7,186) (17,481) (26,087)

Accumulated impairment losses 0 (87) (14) (385) (486)

Net book value at 31 December 30,150 29,962 1,297 7,455 68,864

2008

Net book value at 1 January 35,273 35,825 2,249 15,158 88,505 Revaluation surplus 1,777 225 0 0 2,002 Revaluation defi cit (Note 8) 0 (2,154) 0 0 (2,154) Additions 0 1,509 464 3,416 5,389 Disposals 0 (1,221) (341) (2,167) (3,729) Depreciation charge (Note 8) 0 (1,430) (540) (3,876) (5,846) Assets of companies disposed of (Note 26) 0 (842) (519) (1,889) (3,250) Impairment loss (Note 8) 0 0 (18) 0 (18) Transfer to non-current assets held for sale (Note 7(II)) (6,900) (775) 0 0 (7,675) Net book value at 31 December 30,150 31,137 1,295 10,642 73,224

At cost 0 0 8,053 25,570 33,623 At valuation 30,150 31,201 0 0 61,351 Accumulated depreciation 0 (64) (6,746) (14,890) (21,700) Accumulated impairment losses 0 0 (12) (38) (50) Net book value at 31 December 30,150 31,137 1,295 10,642 73,224


48


11 Property, Plant and Equipment (continued)

Motor Plant vehicles, and equipment Freehold land Buildings machinery and fi xtures Total Company RM’000 RM’000 RM’000 RM’000 RM’000

2009

Net book value at 1 January 30,150 31,137 1,065 10,355 72,707

Additions 0 35 47 376 458

Disposals 0 0 0 (107) (107)

Depreciation charge (Note 8) 0 (1,347) (431) (3,068) (4,846)

Impairment loss (Note 8) 0 (87) (2) (385) (474)

Net book value at 31 December 30,150 29,738 679 7,171 67,738

At cost 0 0 5,326 23,923 29,249

At valuation 30,150 31,236 0 0 61,386

Accumulated depreciation 0 (1,411) (4,633) (16,367) (22,411)

Accumulated impairment losses 0 (87) (14) (385) (486)

Net book value at 31 December 30,150 29,738 679 7,171 67,738

2008

Net book value at 1 January 35,273 35,825 1,520 13,487 86,105 Revaluation surplus 1,777 225 0 0 2,002 Revaluation defi cit (Note 8) 0 (2,154) 0 0 (2,154) Additions 0 401 173 1,741 2,315 Disposals 0 (955) (147) (1,280) (2,382) Depreciation charge (Note 8) 0 (1,430) (463) (3,593) (5,486) Impairment loss (Note 8) 0 0 (18) 0 (18) Transfer to non-current assets held for sale (Note 7(II)) (6,900) (775) 0 0 (7,675) Net book value at 31 December 30,150 31,137 1,065 10,355 72,707

At cost 0 0 5,298 24,283 29,581 At valuation 30,150 31,201 0 0 61,351 Accumulated depreciation 0 (64) (4,221) (13,890) (18,175) Accumulated impairment losses 0 0 (12) (38) (50) Net book value at 31 December 30,150 31,137 1,065 10,355 72,707

The Group’s freehold land, freehold buildings and the building component of owner-occupied leasehold properties were last revalued at 31 December 2008 by independent professionally qualifi ed valuers. Valuations were made on the basis of open market value and in the case of leasehold buildings on the basis of depreciated replacement cost.

If these assets were stated on the historical cost basis, the amounts would be as follows: Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Cost 65,171 65,136 66,995 66,960 Accumulated depreciation (12,390) (10,937) (11,627) (10,169) Net book value 52,781 54,199 55,368 56,791



49

12 Leasehold Land Use Rights

Group Company RM’000 RM’000

2009

At 1 January 11,618 13,473

Amortisation charge for the year (Note 8) (227) (227)

At 31 December 11,391 13,246

2008

At 1 January 11,845 13,700 Amortisation charge for the year (Note 8) (227) (227) At 31 December 11,618 13,473

The analysis of land use rights into long leasehold (with unexpired term of more than 50 years) and short leasehold (with unexpired term of less than 50 years) at the balance sheet date is as follows:

Group 2009 2008

Long Short Long Short leasehold leasehold Total leasehold leasehold Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Cost 13,696 67 13,763 13,696 67 13,763 Accumulated amortisation (2,336) (36) (2,372) (2,110) (35) (2,145) Net book value 11,360 31 11,391 11,586 32 11,618

Company 2009 2008

Long Short Long Short leasehold leasehold Total leasehold leasehold Total RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

Cost 15,487 67 15,554 15,487 67 15,554 Accumulated amortisation (2,272) (36) (2,308) (2,046) (35) (2,081) Net book value 13,215 31 13,246 13,441 32 13,473

13 Investments in Subsidiary Companies

Company

2009 2008 RM’000 RM’000

Unquoted investments at cost 50,185 50,185 Less: Allowance for accumulated impairment losses (18,531) (18,531) 31,654 31,654

A list of subsidiary companies is set out in Note 27.


50


14 Investment in An Associated Company

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Unquoted investment at cost 112,732 112,732 112,732 112,732 Less: Allowance for accumulated impairment losses 0 0 (27,561) (27,561) Less: Interim capital distribution received (79,045) (79,045) (79,045) (79,045) Less: Dividend from pre-acquisition profi t (6,126) (6,126) (6,126) (6,126) 27,561 27,561 0 0 Share of retained profi ts less accumulated losses and reserves of associated company (20,651) (20,642) 0 0 Less: Goodwill written off (6,715) (6,715) 0 0 Interest in associated company 195 204 0 0

The Group’s share of the assets and liabilities and results of the associated company are summarised below:

2009 2008 RM’000 RM’000

Current assets 583 611 Current liabilities (388) (407) Share of attributable net assets 195 204

(Loss)/profi t after tax (9) 127

The details of the associated company are set out in Note 27.

15 Investment in Unquoted Shares

The investment in unquoted shares relates to the Company’s investment in Mercedes-Benz Malaysia Sdn Bhd (“MBM”), a joint-venture company with Daimler AG (“DAG”). The Company subscribed for 49% of the shares in MBM, representing 66,003,000 Class B shares at a par value of RM1 each, whilst DAG subscribed for 51% of the shares in MBM representing 68,697,000 Class A shares at a par value of RM1 each on 10 January 2003. The rights attached to the Class A and Class B shares are set out in the Articles and Memorandum of Association. The participation of the Company in MBM shall not entitle the Company to any veto rights or minority rights except for veto rights under the Malaysian Company law in relation to Class B shares, and accordingly the investment has been accounted for as simple investment instead of an associated company.

There are put and call options in respect of the Company’s stake which are not exercisable prior to 31 December 2012.

Under the terms of the agreement with DAG, the Company is entitled to receive an annual net dividend income of RM11.2 million in respect of the investment in MBM until December 2012.

During the fi nancial year ended 31 December 2009, the Group recognised a dividend income of RM11.2 million (2008: RM11.2 million). In the previous fi nancial year ended 31 December 2008, the Company also received an other income from investment of RM18,714,000. The fair value of the investment in MBM at 31 December 2009 is RM76,223,000 (2008: RM79,030,000). In determining the fair value, the directors have discounted the future contractual cash fl ows from January 2010 to December 2012 at the Group’s rate of return for similar investment, and on the assumption that the Put and Call Options will be exercised on1 January 2013.



51

16 Deferred Taxation

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when the deferred taxes relate to the same tax authority. The following amounts, determined after appropriate offsetting, are shown in the balance sheet:

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Deferred tax assets 1,037 2,608 986 2,461

At 1 January 2,608 (1,197) 2,461 (1,317)

(Charged)/credited to income statement: – property, plant and equipment (1,774) 562 (1,770) 548 – provisions 452 (201) 443 (209) – allowance for stocks (103) (132) (21) (141) – accrued income 0 3,945 0 3,945 – others (146) (329) (127) (325) (1,571) 3,845 (1,475) 3,818

Charged to equity: – property, plant and equipment 0 (40) 0 (40) At 31 December 1,037 2,608 986 2,461

Subject to income tax: Deferred tax assets (before offsetting) Property, plant and equipment 0 1,704 0 1,704 Provisions 907 455 861 418 Allowance for stocks 536 639 491 512 Others 0 146 0 127 1,443 2,944 1,352 2,761 Offsetting (406) (336) (366) (300) Deferred tax assets (after offsetting) 1,037 2,608 986 2,461

Deferred tax liabilities (before offsetting) Property, plant and equipment 406 336 366 300 Offsetting (406) (336) (366) (300) Deferred tax liabilities (after offsetting) 0 0 0 0

The amount of deductible temporary differences and unused tax losses (both of which have no expiry date) for which no deferred tax asset is recognised in the balance sheet are as follows:

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Deductible temporary differences 517 847 0 0 Tax losses 6,235 5,989 0 0


52


17 Inventories

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Motor vehicles 45,095 51,909 40,748 48,118 Spare parts 8,505 10,270 7,703 9,112 53,600 62,179 48,451 57,230

The Group and the Company reversed RM764,000 and RM702,000 (2008: RM1,721,000 and RM598,000) (Note 8) respectively in respect of part of inventory write-down made in prior years that were subsequently not required as the Group and the Company were able to sell these inventories at values above their carrying amounts.

18 Trade and Other Receivables

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Trade receivables 44,322 56,812 41,090 52,809 Less: Allowance for doubtful debts (15,218) (15,418) (15,216) (15,349) 29,104 41,394 25,874 37,460

Warranty claims receivables 1,998 6,150 1,707 5,076 Less: Allowance for doubtful debts (500) (554) (448) (428) 1,498 5,596 1,259 4,648

Dividend receivable 11,229 11,229 11,229 11,229 Deposits 2,000 2,175 1,844 2,142 Prepayments 0 51 0 51 43,831 60,445 40,206 55,530

Credit terms of trade receivables range from 30 to 90 days. All trade receivables and other receivables are denominated in Ringgit Malaysia.

Concentrations of credit risk with respect to trade receivables are limited as the more signifi cant debts are partially backed up by bank guarantees and their payment track records. The Group’s historical experience in collection of accounts receivable falls within the recorded allowances. Due to these factors, management believes that no additional credit risk beyond amounts provided for collection losses is inherent in the Group’s trade receivables.

The Group’s exposure to fl uctuation in foreign currency is limited due to the forward contract entered into by the Group as disclosed in Note 30.

19 Amounts Due From/(To) Subsidiary Companies

Company

2009 2008 RM’000 RM’000

Amounts due from subsidiary companies 6,048 1,538 Less: Allowance for amount due from a subsidiary company (1,152) (1,152) 4,896 386

Amounts due to subsidiary companies (26,147) (33,434)

The amounts due from/(to) subsidiary companies are denominated in Ringgit Malaysia, unsecured, interest free and have no fi xed repayment terms.



53

20 Cash and Cash Equivalents

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Deposits with licensed banks 20,134 47,500 20,134 47,500 Bank and cash balances 8,293 11,266 6,252 8,822 28,427 58,766 26,386 56,322

Bank and cash balances are denominated in Ringgit Malaysia. The bank balances are placed in current accounts with major licensed banks in Malaysia.

The weighted average annual interest rates that were effective as at the balance sheet date were as follows: Group and Company

2009 2008 % % per annum per annum

Bank balances and deposits 1.75 2.85

Deposits with licensed banks of the Group and of the Company have an average maturity period of 1 day (2008: 2 days).

21 Provisions for Liabilities and Charges

Retrenchment/ Service voluntary and separation warranty benefi ts Others Total Group RM’000 RM’000 RM’000 RM’000

At 1 January 2009 822 14 555 1,391

Additional provisions 31 0 197 228

Unused amounts reversed (167) (14) (240) (421)

Credited to income statement (136) (14) (43) (193)

Utilised during the year (14) 0 (221) (235)

At 31 December 2009 672 0 291 963

At 1 January 2008 1,933 1,000 35 2,968

Additional provisions 481 5,485 530 6,496 Unused amounts reversed (281) 0 (10) (291) Charged to income statement 200 5,485 520 6,205 Utilised during the year (256) (5,971) 0 (6,227) Disposal of subsidiaries (Note 26) (1,055) (500) 0 (1,555) At 31 December 2008 822 14 555 1,391


54


21 Provisions for Liabilities and Charges (continued)

Retrenchment/ Service voluntary and separation warranty benefi ts Others Total Company RM’000 RM’000 RM’000 RM’000

At 1 January 2009 710 14 535 1,259

Additional provisions 31 0 178 209

Unused amounts reversed (90) (14) (240) (344)

Credited to income statement (59) (14) (62) (135)

Utilised during the year (14) 0 (220) (234)

At 31 December 2009 637 0 253 890

At 1 January 2008 1,742 1,000 25 2,767

Additional provisions 480 5,485 510 6,475 Unused amounts reversed (1,262) (500) 0 (1,762) (Credited)/charged to income statement (782) 4,985 510 4,713 Utilised during the year (250) (5,971) 0 (6,221) At 31 December 2008 710 14 535 1,259

Service and warranty

The Group and the Company provide service and warranties on vehicles sold under specifi c warranty terms. A provision is made for expected warranty claims based on past service history or potential obligation to maintain brand image.

Retrenchment/voluntary separation benefi ts

As a result of anticipated restructuring undertaken to align the work force to the new business environment, the Group had established a provision for retrenchment benefi t. The provision was based on estimated costs required to compensate the redundant work force. The exercise was completed in the previous fi nancial year.

Others

Other provisions comprise provisions in respect of various legal claims arising from the ordinary course of business. The directors consider the disclosure of further details on those claims unnecessary due to the immaterial amount attributable to each claim.

22 Trade and Other Payables

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Trade payables 71,815 93,900 67,834 87,516 Trade accruals 11,748 12,932 10,628 11,588 83,563 106,832 78,462 99,104

Credit terms of trade payables granted to the Group and the Company vary from 30 to 90 days. All trade payables and accruals are denominated in Ringgit Malaysia.



55

23 Borrowings (Unsecured)

Group and Company

2009 2008 RM’000 RM’000

Current

Bankers acceptance 30,000 0

Contractual terms of borrowings are as follows: Contractual interest rates Total Maturity at balance Functional carrying profi le sheet date currency amount < 1 year Group and Company (per annum) RM’000 RM’000

2009

Unsecured Bankers acceptance 2.41% RM 30,000 30,000

24 Share Capital

Group and Company

2009 2008

’000 RM’000 ’000 RM’000

Ordinary shares of RM1 each

Authorised: At 1 January/31 December 200,000 200,000 200,000 200,000

Issued and fully paid-up: At 1 January/31 December 100,745 100,745 100,745 100,745

25 Retained Profi ts

Under the single-tier tax system which came into effect from the year of assessment 2008, companies are not required to have tax credits under Section 108 of the Income Tax Act 1967 for dividend payment purposes. Dividends paid under this system are tax exempt in the hands of shareholders.

Companies with Section 108 credits as at 31 December 2007 may continue to pay franked dividends until the Section 108 credits are exhausted or 31 December 2013 whichever is earlier unless they opt to disregard the Section 108 credits to pay single-tier dividends under the special transitional provisions of the Finance Act 2007. As at 31 December 2009, the Company has suffi cient tax credits in the Section 108 to pay franked dividends amounting to RM19,079,000 (2008: RM91,312,000) out of its retained profi ts. If the balance of the retained profi ts were to be distributed as dividends, the Company may distribute such dividends under the single-tier system.


56


26 Cash Flow From Operations

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Profi t for the year 28,129 46,785 37,999 40,984

Adjustments for: Property, plant and equipment: – depreciation (Note 11) 5,031 5,846 4,846 5,486 – gain on disposal (Note 8) (64) (11,645) (63) (11,833) – impairment (Note 11) 474 18 474 18 Amortisation of leasehold land use rights (Note 12) 227 227 227 227 Revaluation defi cit of properties (Note 8) 0 2,154 0 2,154 Interest income (Note 8) (1,095) (1,301) (1,095) (1,301) Finance cost 509 769 509 719 Provisions (179) 720 (121) (272) Gain on disposal of subsidiaries 0 (500) 0 (299) Dividends (gross) from subsidiary companies (Note 8) 0 0 (14,027) 0 Provision of retrenchment/voluntary separation benefi ts (14) 5,485 (14) 4,985 Dividend income (Note 8) (11,229) (11,229) (11,229) (11,229) Income from investment (Note 8) 0 (18,714) 0 (18,714) Share of results of an associated company 9 (127) 0 0 Tax expense 8,357 794 11,484 366 2,026 (27,503) (9,009) (29,693) 30,155 19,282 28,990 11,291 Changes in working capital: Inventories 7,969 27,275 8,779 22,797 Receivables 16,614 7,364 15,324 9,290 Payables (22,646) 72,753 (20,629) 64,780 Subsidiary companies’ balances 0 0 (11,797) 50,103 1,937 107,392 (8,323) 146,970 Net cash fl ow from operations 32,092 126,674 20,667 158,261

Disposal of subsidiaries

Subsidiaries disposed by the Group during the previous fi nancial year ended 31 December 2008 were as follows: Group’s effective interest disposed Name of subsidiaries %

Hercules Automotive Engineers Sendirian Berhad 100 Asia Automobile Industries Sendirian Berhad 100 Cycle & Carriage Parts and Accessories Sdn Bhd 100 Cycle & Carriage Motors Sdn Bhd 100



57

26 Cash Flow From Operations (continued)

Details of the assets, liabilities and net cash infl ow arising from the disposal of subsidiaries were as follows: Group RM’000

Property, plant and equipment (Note 11) 3,250 Inventories 20,645 Trade and other receivables 17,149 Bank balances and deposits 1,931 Trade and other payables (7,287) Provision for liabilities and charges (Note 21) (1,555) Borrowings (unsecured) (9,521) Net assets disposed 24,612 Less: Net proceeds from disposal (25,112) Gain on disposal of subsidiaries 500

Cash consideration for the disposal 25,112 Less: Cash and cash equivalents of subsidiaries disposed (1,931) Net cash infl ow on disposal of subsidiaries 23,181

27 Subsidiary and Associated Companies

The subsidiary and associated companies, which are all incorporated in Malaysia, are detailed below: Issued Group’s share capital 2009 2008 Principal activities RM’000 % %

Subsidiary companies

Ipoh Motors Sdn Berhad 1,710 100 100 Retailing of motor vehicles, sales of spare parts, servicing of vehicles and business of an insurance agent.

Srisari Sdn. Bhd. 0* 100 100 Assembly of engines. The company ceased assembly in year 2005 and remained dormant (see note 7(l)(b)).

Selecsama Sdn. Bhd. (formerly 5,000 100 100 The Company commenced operation of sales of known as Cycle & Carriage spare parts and servicing of vehicles during the Automobiles Sendirian Berhad) fi nancial year.

Cycle & Carriage (Malaysia) 31,000 100 100 Retailing of motor vehicles, sales of spare parts, Sdn Berhad provision of after-sales services and hire purchase fi nancing. The company ceased its operation in year 2008 and remained dormant.

Associated company

CCL Group Properties Sdn Berhad # 59,664 40 40 Property investment. * Issued share capital of RM2

# Under members voluntary liquidation

28 Gain on Disposal of Properties

Group and Company

2009 2008 RM’000 RM’000

Leasehold land use rights and freehold land and building 0 7,742 Investment property 0 4,718 0 12,460


58


29 Signifi cant Related Party Disclosures

In addition to related party disclosures disclosed elsewhere in the fi nancial statements, set out below are other signifi cant related party transactions and balances.

The related party transactions described below were carried out on terms and conditions obtainable in transactions with unrelated parties.

Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

(a) With subsidiary companies:

Transfer of motor vehicles and prepaid sales tax to a subsidiary 0 0 44,032 33,344 Transfer of motor vehicles and prepaid sales tax from a subsidiary 0 0 (30,083) (33,425) Sales of motor vehicles, goods and services 0 0 411 2,430 Receipt of rental 0 0 420 819 Receipt of management fees 0 0 317 2,305

(b) With an associated company:

Interim capital distribution 0 450 0 450

(c) With directors/companies related to directors:

Sales of motor vehicles to: – Peremba (Malaysia) Sdn Bhd 0 723 0 723 – Syed Zaid bin Syed Jaffar Albar 0 511 0 511

(d) With substantial shareholders and companies related to

substantial shareholders:

Receipt of rental and miscellaneous income from Mikani Group of Companies 45 429 45 429 Sales of motor vehicle to Jardine Matheson (Malaysia) Sdn. Bhd. 325 0 325 0 Payment of group service charge to Jardine Cycle & Carriage Limited (396) (374) (396) (374) Payment of HR services and IT services to Cycle & Carriage Industries Pte Limited (83) (192) (83) (192) Payment of insurance premiums to Jardine Lloyd Thompson Sdn Bhd (175) (918) (175) (918) Purchase of parts from: – PT Astra Otoparts Tbk 0 (13) 0 0 – Diplomat Parts Pte Ltd 0 (899) 0 0 Payment of computer software and peripherals to Jardine OneSolution (2001) Sdn Bhd (271) (391) (271) (391) Payment to Jardine Matheson & Co., Ltd: – Consultancy and course fees 0 (61) 0 (61) – Group internal audit (255) (240) (255) (240) Payment of professional services rendered from Jardine Matheson (Malaysia) Sdn. Bhd. (196) 0 (196) 0

(e) Remuneration of key management personnel of the Group:

Salaries and other short term employee benefi ts (1,685) (3,680) (1,685) (3,680)



59

29 Signifi cant Related Party Disclosures (continued)

Relationships with the above related parties are as follows:

Related party Relationship

Syed Zaid bin Syed Jaffar Albar Former director of the Company.

Jardine Cycle & Carriage Limited The holding company of the Company.

PT Astra Otoparts Tbk, Subsidiaries of Jardine Cycle & Carriage Limited, the holding company of the Cycle & Carriage Industries Pte Limited, Company. Diplomat Parts Pte Ltd

Jardine Matheson & Co., Ltd, Companies related to Jardine Matheson Holdings Limited, the ultimate Jardine OneSolution (2001) Sdn Bhd, holding company of the Company. Jardine Lloyd Thompson Sdn Bhd, and Jardine Matheson (Malaysia) Sdn. Bhd.

Peremba (Malaysia) Sdn Bhd A company in which Datuk Hassan Abas, a former director of the Company is also a director.

Mikani Group of Companies Companies in which Steven Gareth Foster, a former director of the Company is also a director.

Outstanding balances with the above related parties arose from normal trade transactions during the fi nancial year.

30 Financial Instruments

In applying the Group’s risk management strategy, the Group manages its exposure to foreign currency rate movements through the use of foreign currency forward contracts with creditworthy fi nancial institutions. In general, the Group’s policy is to enter into foreign currency forward contracts for foreign currency assets related to sale of stocks based on confi rmed orders.

The local currency amount to be received and contractual exchange rates of the outstanding contract is as follows: Group and Company

2009 2008 RM’000 RM’000

Singapore Dollar – at rates averaging 1 SGD = RM2.4340 1,664 0

Fair value at 31 December (unfavourable net position) 9 0

The carrying amounts of other fi nancial assets and liabilities of the Group and of the Company at the balance sheet date approximated their fair values.

31 Contingent Liabilities (Unsecured)

(a) At 31 December 2009, the Group and the Company had contingent liabilities in respect of various legal claims against the Company amounting to RM4,462,000 (2008: RM4,858,000). After taking appropriate legal advice, the directors are of the opinion that the outcome of such actions is unlikely to give rise to any signifi cant loss to the Group and the Company.

(b) At 31 December 2009, the Group and the Company had contingent liabilities in respect of recognition of “years of service” in the Company in the event of a “retrenchment or closure exercise” by Mercedes-Benz Malaysia Sdn Bhd (“MBM”) in respect of those former employees who opted to join MBM in December 2002 amounting to RM2,800,000 (2008: RM2,800,000).


60


31 Contingent Liabilities (Unsecured) (continued)

(c) At 31 December 2009, the Group and the Company had contingent liabilities in respect of recognition of “years of service” in the Company in the event of a “retrenchment or closure exercise” by Hap Seng Auto Sdn Bhd (“HSA”) in respect of those former employees who opted to join HSA in December 2005 amounting to RM620,000 (2008: RM620,000).

If these employees are retrenched due to the closure and cessation of business by HSA within 10 years after the completion of the business and asset transfer from the Company’s Kuching Branch to HSA, the Company is liable for the cost of retrenchment in respect of period of employment under the Company.

(d) In 1997, the Company supplied units of bus chassis to Transit Link Sdn Bhd (“Transit Link”) and was paid by Transit Link’s appointed bus body builder, Hup Lee Coachbuilders Holdings Sdn Bhd (“Hup Lee”).

On 10 February 2004, Hup Lee served a Writ of Summons on the Company after an earlier Originating Summons on the same matter was dismissed. In the Writ, Hup Lee is seeking the return of the monies it paid to the Company alleging wrongful payment of RM8 million plus accrued interest. The matter went on trial and the court has decided in favour of the Company. Hup Lee has fi led an appeal to the Court of Appeal. Based on legal advice, the directors believe that the Company has a reasonable chance of succeeding and accordingly, no provision has been made in the fi nancial statements for this claim.

32 Segment Reporting

The activities of the Group are conducted within Malaysia as shown in the following business segments:

• Automobile industry – assembly, distribution and retailing of motor vehicles, distribution and sales of spare parts and servicing of vehicles. • Investment – investment in Mercedes-Benz Malaysia Sdn Bhd. • Others – property investment through an associated company, CCL Group Properties Sdn Berhad (under members voluntary liquidation).


Automobile

industry Investment Others Total

RM’000 RM’000 RM’000 RM’000

2009

Revenue 466,320 0 0 466,320

Results: Segment results 19,794 11,229 0 31,023

Finance cost (509) 0 0 (509)

Share of results of an associated company 0 0 (9) (9)

30,505

Tax expense (Note 6) (6,862)

Net profi t 23,643

Net assets: Segment assets 194,884 77,232 0 272,116

Investment in an associated company 0 0 195 195

Unallocated assets 1,269

273,580

Segment liabilities 114,526 0 0 114,526

Unallocated liabilities 934

115,460

Other information: Capital expenditure 1,201 0 0 1,201

Depreciation and amortisation 5,258 0 0 5,258



61

32 Segment Reporting (continued)


Automobile


RM’000 RM’000 RM’000 RM’000

2009

Revenue 0 0 0 0

Results: Segment results 5,981 0 0 5,981

Tax expense (Note 6) (1,495) 0 0 (1,495)

Net profi t (Note 7(I)) 4,486

Net assets: Segment assets 0

Segment liabilities 0

Other information: Capital expenditure 0 0 0 0

Depreciation and amortisation 0 0 0 0


2008

Revenue 513,090 0 0 513,090 Results: Segment results 17,966 29,943 0 47,909 Finance cost (719) 0 0 (719) Share of results of an associated company 0 0 127 127 47,317 Tax expense (Note 6) (688) Net profi t 46,629

Net assets: Segment assets 254,430 77,232 0 331,662 Investment in an associated company 0 0 204 204 Unallocated assets 3,877 335,743

Segment liabilities 107,251 0 0 107,251 Unallocated liabilities 126 107,377

Other information: Capital expenditure 2,333 0 0 2,333 Depreciation and amortisation 5,881 0 0 5,881


62


32 Segment Reporting (continued)


Automobile


RM’000 RM’000 RM’000 RM’000

2008

Revenue 43,717 0 0 43,717 Results: Segment results 312 0 0 312 Finance cost (50) 0 0 (50) Tax expense (Note 6) (106) 0 0 (106) Net profi t (Note 7(I)) 156

Net assets: Segment assets 823 0 0 823

Segment liabilities 972 0 0 972

Other information: Capital expenditure 3,056 0 0 3,056 Depreciation and amortisation 192 0 0 192

33 Commitments

(a) Capital commitments

Capital expenditure not provided for in the fi nancial statements are as follows: Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Property, plant and equipment – Approved and contracted 25 69 25 32

(b) Operating lease commitments

The Group leases various properties under non-cancellable operating lease agreements. The leases have varying terms and renewal rights.

The future aggregate minimum lease payments under non-cancellable operating leases are as follows: Group Company

2009 2008 2009 2008 RM’000 RM’000 RM’000 RM’000

Not later than 1 year 4,095 4,388 3,505 4,254 Later than 1 year and not later than 5 years 4,690 6,509 4,290 6,500 8,785 10,897 7,795 10,754

34 Approval of Financial Statements

The fi nancial statements have been approved for issue in accordance with a resolution of the Board of Directors on23 February 2010.



63

FIVE-YEAR SUMMARY

2005 2006 2007 2008 2009

RM’000 RM’000 RM’000 RM’000 RM’000

Consolidated Income Statements

Revenue 760,682 640,574 658,566 556,807 466,320

Profi t before tax 33,428 51,859 11,022 47,579 36,486

Tax expense (9,520) (6,163) (3,578) (794) (8,357)

Net profi t attributable to shareholders 23,908 45,696 7,444 46,785 28,129

Earnings per share (sen) 23.7 45.4 7.4 46.4 27.9

Gross dividend per share (sen) 15.0 213.0 10.0 145.0 130.0

Consolidated Balance Sheets

Property, plant and equipment 100,268 90,843 88,505 73,224 68,864 Leasehold land use rights 36,024 13,299 11,845 11,618 11,391

Interests in associated companies 9,374 1,070 527 204 195

Investments in unquoted shares 66,003 66,003 66,003 66,003 66,003 Other net non-current (liabilities)/assets (617) (2,101) (1,197) 2,608 1,037 Non-current assets held for sale 0 7,871 10,332 250 o

Net current assets, other than net cash 285,951 226,545 156,096 15,544 12,203 Net (borrowings)/cash (111,160) (116,227) (44,541) 58,766 (1,573)

Net operating assets 385,843 287,303 287,570 228,217 158,120

Share capital 100,745 100,745 100,745 100,745 100,745 Reserves 285,098 186,558 186,825 127,472 57,375 Shareholders’ funds and capital employed 385,843 287,303 287,570 228,217 158,120

Net asset value per share (RM) 3.83 2.85 2.85 2.27 1.57

Consolidated Cash Flow Statements

Net cash fl ows from operating activities (54,402) 61,826 68,438 120,569 27,489 Net cash fl ows from investing activities 65,325 91,236 10,602 81,316 10,398

Net cash fl ows from fi nancing activities (5,160) (143,329) (88,354) (157,578) (68,226)

Net cash fl ows per share from operating activities (RM) (0.5) 0.6 0.7 1.2 0.3

Key Ratios

Gearing 29% 40% 15% 0% 1%

Interest cover (times) 13 23 4 63 73 Dividend cover (times) 2.2 0.3 1.0 0.4 0.3 Dividend payout 46% 338% 99% 231% 349%

Return on shareholders’ funds 6.3% 13.6% 2.6% 18.1% 14.6%

Notes:

1. Earnings per share is computed based on the net profi t attributable to shareholders divided by the weighted average number of shares in issue.

2. Gross dividend per share represents the dividend declared and dividend proposed per share for the fi nancial year.3. Net asset value per share is computed based on shareholders’ funds divided by the number of shares in issue at the end of the

fi nancial year.4. Net cash fl ows per share from operating activities is computed based on the net cash fl ows from operating activities divided by the

weighted average number of shares in issue.5. Gearing is computed based on net borrowings divided by shareholders’ funds.6. Interest cover is computed based on profi t before interest expense and tax expense divided by interest expense.7. Dividend cover is based on the net profi t attributable to shareholders divided by net dividend declared and dividend proposed for

the fi nancial year.8. Dividend payout is based on net dividend declared and dividend proposed for the fi nancial year divided by net profi t attributable

to shareholders.9. Return on shareholders’ funds is computed based on net profi t attributable to shareholders divided by average shareholders’

funds.10. Included in 2006, 2008 and 2009 gross dividends were special gross interim dividends of 203 sen, 135 sen and 120 sen per share

respectively.


64

FINANCIAL CHARTS

* excluding special interim dividend


65

GROUP PROPERTIES

As at 31 December 2009

Net Book Acquisition

Approximate Value/ Date where

Location of Property Description Age of Building Land Area Land Tenure Fair Value relevant(*)

Years sq. ft. RM’000

1 Lot 5, Jalan Perusahaan Satu, Service centre, 13 178,118 Leasehold 5,472 7.2.1983 Kawasan Perusahaan parts retail (expire in the Batu Caves, Batu Caves, and offi ce. year 2074) Selangor.

2 Lot 421, Jalan Sekudai, MB Autohaus – vehicle 18 222,417 Freehold 13,389 – Johor Bahru, showroom, service centre, Johor. parts retail and offi ce.

3 75, Jalan Tunku Abdul MB Autohaus – vehicle 6 100,144 Freehold 5,182 – Rahman, Ipoh, Perak. showroom, service centre, parts retail and offi ce.

4 No. 37A, Lot 82, Holiday bungalow. 33 50,570 Leasehold 219 31.8.1977 Jalan Kamunting, (expire in the Tanah Rata, year 2037) Cameron Highlands, Pahang.

5 No. 16, Lot 69682, MB Autohaus – vehicle 4 63,227 Freehold 23,642 – Jalan PJU 7/5, showroom, service centre, Mutiara Damansara, parts retail and offi ce. Selangor.

6 Lot 19, MB Autohaus – vehicle 4 102,996 Leasehold 23,344 31.7.1974 Jalan 51A/219, showroom, service centre, (expire in the Petaling Jaya, parts retail and offi ce. year 2066) Selangor.

With effect from 1 January 2006, freehold land which was previously stated at cost is now stated at valuation and buildings which were previously stated at cost less depreciation and impairment losses where applicable are now stated at valuation less depreciation and impairment losses where applicable. The Group’s properties were last revalued in December 2008.

(*) Leasehold land use rights are amortised over the useful life of the lease which includes the renewal period if the lease can be renewed without signifi cant cost. The date of acquisition of leasehold land is as indicated.


66

SHAREHOLDING STATISTICS

Analysis of Shareholdings by Range Groups as at 25 February 2010 No. of % Over Total No. of % Over Total

Size of Shareholdings Shares Shares Holders Shareholders

1 – 99 4,002 0.00 267 7.42100 – 1,000 1,143,142 1.14 1,453 40.391,001 – 10,000 5,899,634 5.86 1,675 46.5710,001 – 100,000 4,395,722 4.36 182 5.06100,001 – 5,037,224 12,031,300 11.94 18 0.505,037,225 and above 77,270,700 76.70 2 0.06 100,744,500 100.00 3,597 100.00

Thirty Largest Shareholders as at 25 February 2010

No. Investor Name/Benefi ciary Name No. of Shares %

1 HDM Nominees (Asing) Sdn Bhd DBS Vickers Secs (S) Pte Ltd for Jardine Cycle & Carriage Limited 59,543,000 59.102 Employees Provident Fund Board 17,727,700 17.603 CIMSEC Nominees (Tempatan) Sdn Bhd Exempt an for CIMB Trustee Berhad 3,792,000 3.764 Kumpulan Wang Simpanan Pekerja 1,500,000 1.495 Key Development Sdn. Berhad 1,183,000 1.176 Gan Teng Siew Realty Sdn. Berhad 1,049,900 1.047 Chinchoo Investment Sdn. Berhad 909,000 0.908 Mikdavid Sdn Bhd 864,900 0.869 Gemas Bahru Estates Sdn. Bhd. 797,700 0.7910 Bidor Tahan Estates Sdn. Bhd. 356,200 0.3511 Citigroup Nominees (Asing) Sdn Bhd CBNY for Dimensional Emerging Markets Value Fund 241,300 0.2412 Sin Ee Nam 203,300 0.2013 Chan Kim Sendirian Berhad 194,900 0.1914 Rengo Malay Estate Sendirian Berhad 179,700 0.1815 HDM Nominees (Tempatan) Sdn Bhd UOB Kay Hian Pte Ltd for Johore (Masai) Plantation Sdn Bhd. 160,000 0.1616 CIMSEC Nominees (Asing) Sdn Bhd Exempt an for CIMB-GK Securities Pte Ltd (Retail Clients) 151,000 0.1517 HDM Nominees (Asing) Sdn Bhd Lim & Tan Securities Pte Ltd for Yap Giau Teck @ Yap Geow Teck 120,000 0.1218 Mikdavid Sdn Bhd 115,000 0.1119 Sin Mong Chon & Sons Sdn Bhd 112,400 0.1120 Goh Geok Loo 101,000 0.1021 Chinchoo Holdings (S) Private Limited 99,800 0.1022 Yap Giau Teck @ Yap Geow Teck 92,700 0.0923 Lim Bee Ling 85,000 0.0824 Chia Choon Kwang @ Chai Choon Kwang 83,500 0.0825 Choonhoi Sdn Bhd 80,600 0.0826 Malayan Jobbers Sdn. Berhad 75,900 0.0827 Liew Yew Chin 75,000 0.0728 Tee Keng Sing 68,000 0.0729 Ong Aik Khoon 62,800 0.0630 Tan Hai Guan 55,000 0.05 90,080,300 89.38

Substantial Shareholders as at 25 February 2010 Direct Indirect

No. Name No. of Shares % No. of Shares %

1 Jardine Cycle & Carriage Limited 59,543,000 59.10 – –2 Employees Provident Fund Board/ Kumpulan Wang Simpanan Pekerja 19,227,700 19.09 – –3 Jardine Matheson Holdings Limited – – 59,543,000* 59.104 JMH Investments Limited – – 59,543,000* 59.105 Jardine Strategic Holdings Limited – – 59,543,000* 59.106 JSH Asian Holdings Limited – – 59,543,000* 59.107 Jardine Strategic Singapore Pte Ltd – – 59,543,000* 59.10

* Deemed interest by virtue of Section 6A of the Companies Act, 1965


67

NOTICE OF ANNUAL GENERAL MEETING

NOTICE IS HEREBY GIVEN THAT the 42nd Annual General Meeting of the Company will be held at Concorde Ballroom 1, Lobby Level, Concorde Hotel, Jalan Sultan Ismail, 50250 Kuala Lumpur on Tuesday, 27 April 2010 at 9.30 a.m., for the following purposes:

1. To receive the Audited Financial Statements for the fi nancial year ended 31 December 2009 together with the Reports of the Directors and the Auditors thereon. (Resolution 1)

2. To approve the payment of a fi nal dividend of 5 sen per share less 25% income tax for the fi nancial year ended 31 December 2009 as recommended by the Directors. (Resolution 2)

3. To approve the payment of Directors’ fees of up to RM341,000 for the fi nancial year ending 31 December 2010 (2009: RM338,000). (Resolution 3)

4. To re-elect Benjamin William Keswick, who is retiring pursuant to Article 98 of the Articles of Association of the Company. (Resolution 4)

5. To re-elect Datuk Syed Tamim Ansari bin Syed Mohamed, who is retiring by casual vacancy pursuant to Article 103 of the Articles of Association of the Company. (Resolution 5)

6. To re-appoint Tan Sri Dato’ Sulaiman bin Sujak, who is over the age of 70 years and retiring pursuant to Section 129 of the Companies Act, 1965. (Resolution 6)

7. To re-appoint Messrs. PricewaterhouseCoopers as Auditors and to authorise the Directors to fi x their remuneration. (Resolution 7)

8. To transact any other ordinary business of which due notice shall be given.

As Special Business:

To consider and, if thought fi t, to pass the following as Ordinary Resolutions:

9. Authority to Issue Shares pursuant to Section 132D of the Companies Act, 1965 (“the Act”)

“THAT the Directors of the Company be and are hereby authorised, pursuant to Section 132D of the Act, to issue shares in the Company at any time subject to Section 132D of the Act and upon such terms and conditions and for such purposes as the Directors may, in their absolute discretion, deem fi t provided that the aggregate number of shares to be issued pursuant to this resolution does not exceed 10 percent of the issued share capital of the Company for the time being and that the Directors be and are also empowered to obtain the approval for the listing of and quotation for the additional shares so issued on the Bursa Malaysia Securities Berhad and that such authority shall continue to be in force until the conclusion of the next Annual General Meeting of the Company.” (Resolution 8)

10. Proposed Renewal of Shareholders’ Mandate for Recurrent Related Party Transactions of a Revenue or Trading Nature (“RRPT”)

(i) “THAT, subject to the Listing Requirements of Bursa Malaysia Securities Berhad, approval be and is hereby given to renew the shareholders’ mandate to allow Cycle & Carriage Bintang Berhad Group to enter into recurrent related party transactions of a revenue or trading nature with related parties which are necessary for the day to day operations and not more favourable to the related parties than those generally available to the public (“Proposed Shareholders’ Mandate”) and are not to the detriment of the minority shareholders as set out in Section 2.3 of the Circular and that the authority conferred by this resolution shall take effect immediately upon the passing of this resolution;

(ii) THAT such Proposed Shareholders’ Mandate be subject to annual renewal and such approval shall continue to be in force until:

(a) the conclusion of the next Annual General Meeting of the Company following this Annual General Meeting, at which time it will lapse, unless by a resolution passed at the meeting, the authority is renewed;

(b) the expiration of the period within which the next Annual General Meeting after the date is required to be held pursuant to Section 143(1) of the Act (but must not extend to such extension as may be allowed pursuant to Section 143(2) of the Act); or

(c) revoked or varied by resolution passed by the shareholders in general meeting;

whichever is the earlier;

(iii) THAT the Directors of the Company be and are hereby authorised to complete and do all such acts and things (including executing all such documents as may be required) as they may consider expedient or necessary to give effect to the renewal and the extension of the scope of the Proposed Shareholders’ Mandate;


68

As Special Business: (continued)

(iv) THAT the estimates given of the recurrent related party transactions (“Recurrent Related Party Transactions”) specifi ed in Section 2.3.2 of the Circular being provisional in nature, be accepted and that the Directors be and are hereby authorised to agree to the actual amounts thereof provided always that such amount or amounts comply with the procedures set out in Section 2.4 of the Circular; and

(v) THAT the aggregate value of the transactions conducted pursuant to the Proposed Shareholders’ Mandate during the fi nancial year be disclosed in the annual report in accordance with the Main Market Listing Requirements of Bursa Malaysia Securities Berhad.” (Resolution 9)

To consider and, if thought fi t, to pass the following resolution as Special Resolution:

11. Proposed Amendments to the Articles of Association of the Company

THAT the Articles of Association of the Company be amended as follows:

a. “THAT a new article, to be numbered 105(c), be inserted to read as follows:

105. (c) Meetings By Electronic Means

(i) In this article “electronic” means actuated by electric, magnetic, electron-magnetic, electro-chemical or electro-mechanical energy and “by electronic means” means by any manner only capable of being so actuated and shall include, but not limited to the telephone, video conferencing and telephone conferencing.

(ii) A person in communication by electronic means with the Chairman and with all other parties to a meeting of the Directors or of a committee of the Directors shall be regarded for all purposes as personally attending such a meeting and shall be counted in a quorum and be entitled to vote but only for so long he has the ability to communicate interactively and simultaneously with all other parties attending the meeting including all persons attending by electronic means.

(iii) A meeting at which one or more of the Directors attends by electronic means is deemed to be held at such place as the Directors shall at the said meeting resolve. In the absence of a resolution as aforesaid, the meeting shall be deemed to be held at the place, if any, where a majority of the Directors attending the meeting are physically present, or in default of such a majority, the place at which the Chairman of the meeting is physically present.

(iv) Subject to the Companies Act, 1965, all business transacted in the manner provided above by electronic means shall for the purpose of these articles be deemed to be validly effectively transacted at a meeting of the board or a committee of the board notwithstanding that two or fewer than two Directors or Alternate Directors are physically present at the same meeting.

b. THAT Article 136 of the Articles of Association be deleted in its entirety and substituted thereof with the following new article:

136. Any dividend, interest, or other monies payable in cash in respect of shares may be paid by cheque or warrant sent through the post and to the last registered address of the member or person entitled thereto or by direct transfer or such other mode of electronic means (subject to the provision of the Act, the Central Depositories Act and the Rules, the Listing Requirements and/or other regulatory authorities) to the bank account of the holder whose name appear in the Register or Record of Depositors respectively. Every such cheque or warrant or payment by direct transfer shall be made payable to the order of the person to whom it is sent or to such person as the holder or person or persons entitled to the share in consequence of the death or bankruptcy of the holder may direct and the payment of the cheque or warrant by such electronic means shall be a good discharge to the Company of the dividend to which it relates, regardless that it may subsequently appear that the cheque or warrant has been stolen or that endorsement thereon has been forged or of any discrepancy given by the member in the details of the bank account(s). Every such cheque or warrant shall be sent at the risk of the person entitled to the money represented thereby.

(old article) 136. Any dividend or other moneys payable in cash on or in respect of a share may be paid by cheque or warrant sent through

the post to the registered address of the Member or person entitled thereto, or, if several persons are registered as joint holders of the share or are entitled thereto in consequence of the death or bankruptcy of the holder to any one of such persons or to such persons at such address as such persons may by writing direct. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent or to such person as the holder or joint holders or person or persons entitled to the share in consequence of the death or bankruptcy of the holder may direct and payment of the cheque if purporting to be endorsed or the receipt of any such person shall be a good discharge to the Company. Every such cheque or warrant shall be sent at the risk of the person entitled to the money represented thereby.



69

c. THAT Article 147 of the Articles of Association be amended by the inclusion of the sentence: “For avoidance of doubt, the Company shall be entitled to send the copy of every balance sheet, profi t and loss account (including every document required by law to be annexed thereto and the auditors’ report to the members via CD-ROM or other electronic means.)” at the end of the existing article.

147. A copy of every balance sheet and profi t and loss account which is to be laid before a General Meeting of the Company (including every document required by the Act to be annexed thereto) together with a copy of every report of the Auditors relating thereto and of the Directors’ report shall not less than fourteen days before the date of the Meeting be sent to every Member of, and every holder of debentures (if any) of, the Company and to every other person who is entitled to receive notices from the Company under the provisions of the Act or these Articles; provided that this Article shall not require a copy of these documents to be sent to any person of whose address the Company is not aware or to more than one of the joint holders of a share in the Company or the several persons entitled in consequence of the death or bankruptcy of the holder or otherwise but any Member to whom a copy of these documents has not been sent shall be entitled to receive a copy free of charge on application at the Offi ce. For avoidance of doubt, the Company

shall be entitled to send the copy of every balance sheet, profi t and loss account (including every document required

by law to be annexed thereto and the auditors’ report to the members via CD-ROM or other electronic means.)”

(Resolution 10)

Notice of Dividend Entitlement and Payment

NOTICE IS ALSO HEREBY GIVEN THAT subject to the approval of Members at the 42nd Annual General Meeting of the Company to be held on Tuesday, 27 April 2010, a fi nal dividend of 5 sen per share less 25% income tax, for the fi nancial year ended 31 December 2009 will be paid on Friday, 25 June 2010 to Depositors whose names appear in the Record of Depositors on Monday, 31 May 2010.

FURTHER NOTICE IS HEREBY GIVEN THAT a Depositor shall qualify for the dividend entitlement only in respect of:

(a) shares transferred into the Depositor’s Securities Account before 4.00 p.m. on Monday, 31 May 2010 in respect of ordinary transfers; and

(b) shares bought on the Bursa Malaysia Securities Berhad on a cum entitlement basis according to the Rules of the Bursa Malaysia Securities Berhad.

By Order of the Board

Yeap Kok Leong (MAICSA No. 0862549)

Oh Swee Chin (MAICSA No. 7055178)

Company Secretaries

Kuala Lumpur, 5 April 2010


70

Notes:

1. A Member of the Company entitled to attend and vote at the meeting is entitled to appoint a proxy or in the case of a corporation, to appoint a representative to attend and vote in his place. A proxy need not be a Member of the Company.

2. The Form of Proxy must be signed by the appointor or his attorney duly authorised in writing or if the appointor is a corporation either under common seal or under the hand of an attorney or an offi cer duly authorised.

3. In the event the Member duly executes the Form of Proxy but does not name any proxy, such Member shall be deemed to have appointed the Chairman of the meeting as his proxy.

4. Any alterations in the Form of Proxy must be initialled.

5. To be valid, the Form of Proxy duly completed must be deposited at the Registered Offi ce of the Company at Level 18, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur, Malaysia, not less than 48 hours before the time for holding the meeting or adjourned meeting.

6. Where a Member is an authorised nominee as defi ned under the Securities Industry (Central Depositories) Act, 1991, it may appoint at least one (1) proxy in respect of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account.

7. For the purpose of determining a member who shall be entitled to attend the 42nd Annual General Meeting, the Company shall be requesting Bursa Malaysia Depository Sdn Bhd, in accordance with Article 58(2) of the Company’s Articles of Association and Section 34(1) of the Securities Industry (Central Depositories) Act, 1991 to issue a General Meeting Record of Depositor as at 19 April 2010. Only a depositor whose name appears therein shall be entitled to attend the said meeting or appoint a proxy to attend and/or vote on his stead.

Explanatory Notes on Ordinary Business:

Ordinary Resolution 3 – Directors’ fees for the fi nancial year ending 31 December 2010

Directors’ fees approved for the fi nancial year 2009 was RM338,000. The actual Directors’ fees for Non-Executive Directors paid during the fi nancial year 2009 was RM337,000. The Directors’ fees proposed for the fi nancial year 2010 are calculated based on the number of scheduled Board and Committee meetings for 2010 and assuming that all Non-Executive Directors will hold offi ce until the end of the fi nancial year. This resolution is to facilitate payment of Directors’ fees on current fi nancial year basis. In the event the Directors’ fees proposed is insuffi cient (e.g. due to more meetings or enlarged Board size), approval will be sought at the next Annual General Meeting for additional fees to meet the shortfall.

Explanatory Notes on Special Business:

Ordinary Resolution 8 – Authority to Issue Shares pursuant to Section 132D of the Companies Act, 1965

The Ordinary Resolution 8 proposed pursuant to Section 132D of the Act, if passed, will empower the Directors to allot and issue shares in the Company up to an amount not exceeding in total 10 percent of the issued share capital of the Company for such purposes as the Directors consider would be in the interest of the Company. This authority, unless revoked or varied by the Company at a general meeting, will expire at the next Annual General Meeting. The Directors did not allot nor issue any shares under the same mandate granted last year. Nevertheless a renewal for the said mandate is sought to avoid any delay and cost involved in convening such a general meeting. The Directors would utilise the proceeds raised from this mandate for working capital or such other applications they may in their absolute discretion deem fi t.

Ordinary Resolution 9 – Recurrent Related Party Transaction

For further information on Ordinary Resolution 9, please refer to the Circular to Shareholders dated 5 April 2010 accompanying the Company’s Annual Report for the year ended 31 December 2009.

Special Resolution 10 – Proposed Amendments to the Articles of Association of the Company

The proposed special resolution to amend Articles 105, 136 and 147 of the Company’s Articles of Association is to enhance the Board’s effi ciency and facilitate the future payments of dividends through electronic means and to allow the Company, should it be found expedient to do so, to send to the members the Company’s Annual Report in CD-ROM format.

STATEMENT ACCOMPANYING NOTICE OF ANNUAL GENERAL MEETINGPursuant to Paragraph 8.27(2) of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad

There is no person seeking election as Director of the Company at this Annual General Meeting.


I/We

of

being a member/members of CYCLE & CARRIAGE BINTANG BERHAD hereby appoint

of

or whom failing

of

to vote for me/us on my/our behalf at the Annual General Meeting to be held at Concorde Ballroom 1, Lobby Level, Concorde Hotel,

Jalan Sultan Ismail, 50250 Kuala Lumpur on Tuesday, 27 April 2010 at 9.30 a.m. and at any adjournment of such meeting.

(Should you desire to direct your proxy to vote on the Resolutions set out in the Notice of Meeting and summarised below, please

indicate with an “X” in the appropriate spaces. If no specifi c direction as to voting is given, the proxy will vote or abstain at his

discretion.)

Number of shares held

Dated this day of 2010

Signature of Member or Common Seal

Notes:

1. A Member of the Company entitled to attend and vote at the meeting is entitled to appoint a proxy or in the case of a corporation, to appoint a representative to

attend and vote in his place. A proxy need not be a Member of the Company.

2. The Form of Proxy must be signed by the appointor or his attorney duly authorised in writing or if the appointor is a corporation either under common seal or under

the hand of an attorney or an offi cer duly authorised.

3. In the event the Member duly executes the Form of Proxy but does not name any proxy, such Member shall be deemed to have appointed the Chairman of the meetings

as his proxy.

4. Any alterations in the Form of Proxy must be initialled.

5. To be valid, the Form of Proxy duly completed must be deposited at the Registered Offi ce of the Company at Level 18, The Gardens North Tower, Mid Valley City,

Lingkaran Syed Putra, 59200 Kuala Lumpur, Malaysia, not less than 48 hours before the time for holding the meeting or adjourned meeting.

6. Where a Member is an authorised nominee as defi ned under the Securities Industry (Central Depositories) Act, 1991, it may appoint at least one (1) proxy in respect

of each Securities Account it holds with ordinary shares of the Company standing to the credit of the said Securities Account.

7. For the purpose of determining a member who shall be entitled to attend the 42nd Annual General Meeting, the Company shall be requesting Bursa Malaysia

Depository Sdn Bhd, in accordance with Article 58(2) of the Company’s Articles of Association and Section 34(1) of the Securities Industry (Central Depositories) Act,

1991 to issue a General Meeting Record of Depositors as at 19 April 2010. Only a depositor whose name appears therein shall be entitled to attend the said meeting

or appoint a proxy to attend and/or vote on his stead.

Ordinary Business For Against

Ordinary Resolution 1







Special Business



Special Resolution 10

Form of ProxyCycle & Carriage Bintang Berhad (7378-D)

(Incorporated in Malaysia)

(NRIC) (new) (old)

(NRIC) (new) (old)

(NRIC) (new) (old)

fold here

Cycle & Carriage Bintang Berhad (7378-D)Level 18, The Gardens North Tower

Mid Valley City, Lingkaran Syed Putra

59200 Kuala Lumpur

Malaysia

Stamp

fold here

www.ccb.com.my

Documents

Cycle & Carriage Bintang Berhad Annual Report 2009...Cycle & Carriage Bintang Berhad Annual Report 2009 1 CONTENTS 2 Financial Highlights 3 Corporate Proﬁ le 3 Corporate Information