GP AR ie ce:La 1 29/05/12 4:35 PM Page 1 - Green Packet · 2018. 7. 25. · China, Taiwan, Australia, Bahrain, Egypt, Hong Kong, Spain and ... mobile broadband and networking solutions

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CORPORATE GOVERNANCE

033 Statement on Corporate Governance

040 Audit Committee Report

044 Statement on Internal Control

046 Statement on Directors’ Responsibility

047 Additional Compliance Information

049 Financial Statements

OTHER CORPORATE INFORMATION

139 List of Property

140 Analysis of Shareholdings

144 Analysis of Warrantholdings

146 Notice of Annual General Meeting

148 Statement Accompanying

Notice of Annual General Meeting

149 Appendix I

Form of Proxy

CORPORATE INFORMATION

002 Vision and Mission

004 About Green Packet

006 Our Core Business

008 Solutions Converged Communications Services

012 Our Corporate Milestones

014 Corporate Responsibility

016 Corporate Information

017 Corporate Structure

018 5-Year Financial Highlights

020 Board of Directors

022 Profile of Directors

027 Message from the Chairman

GP AR pg1-32:GP proposed 28/05/12 3:16 PM Page 1

2 Green Packet Berhad | Annual Report 2011

To be a visionaryglobal leader in delivering bestconnectivity to enrich lives.


Annual Report 2011 | Green Packet Berhad 3

We set out to be an inspiring international brand andcompany offering high value and beneficial products,solutions and services through our two synergistic businesspillars of Solutions and Converged Communications Services.To fulfill our mission, we will continuously:

• Innovate to meet the current and future needs of our customers; and commit to the culture of service excellence

• Deliver our value proposition to the international marketplace

• Develop, engage and appreciate our people

• Adopt organizational best practices

• Generate sustained growth and fair shareholder returns

• Be a responsible and active corporate citizen



Green Packet Berhad (Green Packet) is an international informationtechnology and communications company founded in the SiliconValley, California. In year 2000, Green Packet established a regionalR&D and marketing centre in Malaysia, a strategic location andgateway to the new major economies in ASEAN.



Over the years, the Company has evolved to be recognized as aleading player in Next Generation mobile broadband and networkingsolutions with an exceptional range of revolutionary communicationsproducts and services. Its business is anchored on two key pillars -

“Solutions and

Converged Communications Services”

Green Packet is today headquartered near Malaysia’s robustcapital city, Kuala Lumpur, and is listed on the Main Market of BursaMalaysia Securities Berhad. It has operations in the USA, Singapore,China, Taiwan, Australia, Bahrain, Egypt, Hong Kong, Spain andBrazil, and employs more than 1,000 employees.





Green Packet presents a compelling business case to the entirewireless value chain - device manufacturers, telecommunicationscompanies (Telcos) and end-consumers - for the implementation of pervasive wireless access to fulfill the customer’s needs andexpectations for connectivity, mobility, security and lifestylerequirements.

Green Packet fully harnesses the powerful synergy of its two corebusiness pillars of ‘Solutions’ and ‘Converged CommunicationsServices’ to deliver unique benefits to our wide-ranging customers.

PILLAR 1: SOLUTIONS

Provision of leading carrier-grade solutions and award-winningconsumer devices to Telcos and device manufacturers.

Green Packet has expertise in providing a seamless andunified platform to deliver multimedia communications andservices regardless of the nature and availability of backboneinfrastructures. Its range of products opens up new avenuesfor Telcos and device manufacturers to gain competitiveadvantage by enabling the seamless integration of fixed,mobile, voice, and data networks; and their provision ofanytime, anywhere access and relevant content to the end-user.

PILLAR 2: CONVERGED COMMUNICATIONS SERVICES

Provision of 4G wireless broadband converged servicesspanning connectivity, communications, and content andservices.

Green Packet’s subsidiary, Packet One Networks (Malaysia)Sdn Bhd better known as P1, is Malaysia’s first and leading4G Telco providing Malaysian broadband consumers withsuperior value high speed wireless broadband services torealize P1’s ‘broadband for all’ mission.



GREENPACKET SOLUTIONS

Greenpacket Solutions prides itself as a leading developer of Next Generationmobile broadband and networking solutions with the vision in a future of limitlessfreedom in wireless communications. With its extensive portfolio of highly innovativecarrier-grade solutions and award-winning consumer devices, GreenpacketSolutions helps telecommunication operators open new avenues, meet newdemands, and enrich lifestyles while forging new relationships.

CARRIER SOLUTIONS

Greenpacket Solutions offers a wide range of award winning carrier-grade,customizable solutions encompassing connectivity, communications, contentdelivery and diagnostics. Our connectivity experience and mobile data offloadsolutions facilitates the delivery of a meaningful connectivity experience that arelifestyle-based, feature rich and customizable to offer best-in-class user experiencewhilst addressing prevailing carriers need for network convergence. With ourindustry know-how, Operators enjoy shorter time-to-market, tremendous costsavings, and customer loyalty which translate into improved Average Revenue PerUser (ARPU).

Greenpacket Solutions’ award-winning Intouch Connectivity Experience solution converts Multiple Devices, Multiple Networksand Multiple Environments into a converged experience. Intouch Connectivity Experience delivers next generation networksexperience management through a single-client platform for handhelds, modems and laptops across multiple networks andautomated over the air firmware updates gives the convenience to ensure consumers’ device are always up-to-date.

Intouch Connectivity Experience wasnominated as a finalist for the World VendorAward 2012.

Intouch Connectivity Experience wasawarded the Product of The Year by 4GWireless 2010.

Intouch Connectivity Experience wasawarded the TMC WiMAX DistinctionAward 2009.

INTOUCH CONNECTIVITY EXPERIENCE

AWARD & NOMINATIONS



INTOUCH DATA OFFLOAD

Greenpacket Solutions’ Intouch Data Offload is a carrier-grade solution thatcomprises of Intouch Seamless Data Offload and Intouch Dynamic Data Offload totransparently offload 3G~Wi-Fi and to push operator’s services and manage datatraffic effectively. Users will enjoy uninterrupted connectivity on-the-go ensuring that they are connected anytime, anywhere for a truly ubiquitous connectivityexperience.

4G DEVICES

Greenpacket Solutions’ comprehensive range of field-tested 4G WiMAX Modems encompasses indoor, outdoor, USB donglesand pocket modems for residential, enterprise and nomadic use. Greenpacket Solutions’ award-winning 4G WiMAX Modemshave been widely recognized by 4G operators to be best-in-class devices with superior indoor and outdoor signal qualityperformance, rich features and attractive form factor which reaffirm Greenpacket Solutions’ commitment to innovating highquality products that address real market needs.

In 2012, Greenpacket Solutions has already embarked on the LTE trail with the company’s first LTE product made available inthe second quarter.

DX Tower WiMAXIndoor Modem wasawarded the Productof The Year by 4GWireless Evolution2012.

UH Shuttle 4G WiMAX USBModem was nominated forthe German Design Awards2012, in the Product Designcategory.

UH Shuttle 4G WiMAX USBModem was honored the iFProduct Design Award2011 for its outstandingdesign achievement.

OX WiMAX OutdoorModem.

Pocket Modem. UT WiMAX USBModem.

WN Wi-Fi NetworkExtender.

Greenpacket’s DV 4G WiMAX IndoorModem was awarded the TMC WiMAXDistinction Award2009.

INSTINQ SERVICE MANAGEMENT AND OPERATIONS

Instinq Service Management and Operations is an intelligent solution that providesproactive self-service customer care through online and offline support. The diagnostic and self-healing mechanism detects and resolves deviceconnectivity issues with pre-engineered knowledge models. The closed looplearning system aggregates knowledge model over time and troubleshoots andresolves problems without the intervention of customer support personnel.

1.

2.

UH Shuttle 4G WiMAX USBModem was awarded theProduct of The Year by 4GWireless Evolution 2010.

3.



Packet One Networks (Malaysia) Sdn Bhd ("P1"), a subsidiary of Green Packet Berhad with South Korea leading Operator, SKTelecom as second largest shareholder, is Malaysia's first and leading 4G telecommunications company. P1 4G representsthe first large-scale commercial 4G WiMAX deployment in Southeast Asia, and the first large-scale deployment of an 802.16e2.3GHz WiMAX network outside Korea. Although LTE is still in its infancy in Malaysia, P1 is already gearing up for 4G LTEtransition and deployment through strong strategic partnerships with the world’s largest LTE proponents namely QualcommInternational, China Mobile Limited and being accepted into the elite Global TD-LTE Initiative (“GTI”) that encompasses morethan half the world’s market potential. P1's goal is to bridge the digital divide by making access to the internet universal,ubiquitous and affordable for every Malaysian. P1 hopes to play a major part in realizing the nation's goal providing Broadbandfor All.

INSTANT BROADBAND CAMPAIGN USER PROFILING CAMPAIGN



P1 is the winner of the Red Herring Asia's Most Innovative Private Technology Company in 2008 and is listed in the MalaysiaBook of Records as Malaysia's first WiMAX telco (August 2008). In 2009, P1 bagged the MSC Malaysia APICTA Best of Start-Up Companies award. P1 is awarded the 2010 Most Promising Service Provider of the Year by the prestigious 2010 Frost &Sullivan Malaysia Telecoms Awards. P1’s "Sudah Potong?" advertising campaign bagged gold at the highly coveted 2010Malaysia Effie Awards. In 2011, P1 bags the Best Enterprise Brand of the year 2010 from Global Golden Brand Award. At thesame time, P1 is awarded by Global Leadership Awards in Internet Category.

POTONG STIM CAMPAIGN4G SPOT CAMPAIGN TO CREATE

AWARENESS OF NEW SITESP1 TURNED 3



01 JANGreenpacket Solutions extended its award winning IntouchConnection Manager application to three of the world’s mostpopular mobile platforms - Android, Symbian and WindowsMobile which received the ‘2010 4G Wireless EvolutionProduct of the Year’ award.

P1 and its Korean business partner SK Telecom wascongratulated by Minister of South Korea telecommunications andregulator; the Korea Communications Commission ChairmanSeejoong Choi on reaching the important milestone of securing280,000 subscribers for its P1 4G broadband service in hisspecial visit to P1’s headquarters.

02 FEBGreenpacket Solutions inked an agreement with TimeWarner Cable, the second largest cable operator in the U.S.with 14.5 million customers across 28 states, to provide itsnext generation connection management solutions.

Greenpacket Solutions secured 35 percent of the Africanmobile WiMAX market as they sealed another WiMAX dealwith Zimbabwe internet service and VoIP provider ApticsTrading.

P1 provided broadband to students’ college campus andresidential quarters at Insaniah University College in AlorSetar, Kedah.

03 MARGreenpacket Solutions launched its new line of pocketmodems to address rising demands for superior broadband on-the-go experience, taking personal broadband to a newlevel.

Greenpacket Solutions first to launch Interworking WirelessLAN (iWLAN) Client as part of its Intouch Connection Management(ICM) solution for secured data offload.

P1 launched the 'Instant Broadband' campaign as part of itsongoing effort to make 4G broadband more accessible,affordable and instantaneous for all Malaysians.

04 APRGreenpacket Solutions’ Intouch Connection ManagementPlatform (ICMP) now enhanced with Access NetworkDiscovery and Selection Function (ANDSF) which enablesmobile operators to dynamically offload subscribers fromcongested cellular networks to Wi-Fi networks using intelligentswitching rules based on operator’s network managementpolicies and controls.

P1 strengthens the 4G leadership by being the first to harness the power of WiMAX and LTE technologies in a livedemonstration to members of the media.

P1 had the honor of the SK Group chairman visitation atPacket Hub.

05 MAYP1 received RM201.6 million from their major shareholders, SK Telecom of Korea and Green Packet Berhad to supportthe accelerated expansion of its 4G WiMAX/TD-LTE networkexpansion.



06 JUNP1, Malaysia and Southeast Asia’s first 4G WiMAX serviceprovider joined the ranks of global operators in the Global TD-LTE Initiative (“GTI”) to champion the TD-LTE technology.The membership acceptance further affirms P1’s commitmentin embracing the next wave of 4G technology evolution.

P1 signed a Memorandum of Understanding with QualcommInternational to collaborate on the deployment of Long TermEvolution Time Division Duplex (LTE TDD) technology inMalaysia, witnessed by the Minister of Information,Communications and Culture YB Dato’ Sri Utama Dr. RaisYatim and wife, Datin Sri Maznah Rais at the CommunicAsiain Singapore.

P1 sealed an agreement with China Mobile to spearhead the TD-LTE technology movement in Malaysia and South-East Asia,witnessed by Deputy Minister of Information, Communicationsand Culture Malaysia Dato’ Joseph Salang and Charge’dAffaires of China to Malaysia His Excellency Chen Dehai.

07 JUL Greenpacket Solutions breaks new ground as world-classproduct developer with design nomination from the GermanDesign Awards 2012 for their Shuttle’ WiMAX USB Modem.

Greenpacket Solutions customers test run LTE-ready IntouchConnection Manager for the first time.

Greenpacket Solutions, P1 and Sequans CommunicationsS.A. collaborate on LTE solutions.

P1 launched a new broadband bundle plan called the One Planthat offers an all-round improved broadband experience to itsusers.

08 AUGWateen Telecom awarded Greenpacket Solutions with a 2-year contact for its Hybrid ‘Shuttle’ modem.

P1 signed an agreement with eight State-backed companiesunder the umbrella of Persatuan Penyedia InfrastrukturTelekomunikasi to further boost its 4G service provision in thecountry. P1 currently covers 45 percent of the population andaims to hit 65 percent coverage by 2012.

09 SEP Greenpacket Solutions launched its new value packedWiMAX compliant Indoor Modems, the DV235 and DV360.

Greenpacket Solutions’ ANDSF Client successfully testedwith Bridgewater Policy Servers to enable dynamic dataoffload for operators globally.

10 OCT Greenpacket Solutions published its first case studyperiodical “Communicating Success” which featured theirsuccessful collaboration with Time Warner Cable along withother operators in the world.

Greenpacket Solutions clinched 4G devices deals with Aria and Max Telecom, rapidly expanding its presence in theEuropean market.

P1 joined forces with Telekom Malaysia Berhad (“TM”) to accelerate the delivery of High Speed Broadband (HSBB)services to all Malaysians, powered by TM’s HSBBinfrastructure. Under the agreement sealed between the twoparties, TM will be providing the HSBB (Access) and HSBB(Transmission) services to P1 whereby P1 will have access toall 1.3 million homes covered by the HSBB areas nationwide.

11 NOV Greenpacket Solutions’ Intouch Connectivity Managementand Data Offload Solutions (ICMP) is chosen by SmartCommunications Philippines which enabled Smart to be thefirst Philippines operator to offer converged connectivity acrossits 3G and WiFi access networks.

Greenpacket Solutions’ WiMAX pocket modem, MF250 madee-learning a reality for the Kings Country School Districts,California USA.



At the Green Packet Group, corporate responsibility is integratedinto every aspect of our business to enhance shareholder value. It guides the way we make business decisions, managerisks, the way we operate, the design and development of our products and services, to how we grow our people and the waywe communicate.

• Packet Hoops

2011• Packeteers showed how they ha

ve

‘evolved’ for the Evolution Nite 2011

• CNY 2011 Celebration at Packet Hub • Christmas Carolling 2011

EMPLOYEE ENGAGEMENT

We believe that the most important asset of our company isour employees, whom we refer to as the ‘Packeteers’. TheGroup aims to find and keep the highest caliber employeesand encourage their strong contribution through variouscommunication tools and activities. These include:

PacketNet, The Group’s intranet portal, which facilitates ouremployees’ daily administrative tasks and enables robustinformation and knowledge sharing amongst employees.

Face-to-face sessions which comprises our Quarterly TeamMeet or casual ‘Teh Tarik’ (tea) sessions for employees to getcloser to Top Management and provide feedback about theCompany.

Active information updates on key corporate developmentsand activities disbursed via platforms such as email, memoboard, and the Company’s bi-monthly internal e-newsletter,Packeteers’ Pride.

Fielding of ideas, input and feedback with easily accessiblechannels such as the email-based ‘Idea Hub’ and ‘speakout’boxes located at every floor of our office building.



GREAT WORKPLACE

We try to create a great workplace for our employees as theyspend so many hours at work. This extends beyond facilitiessuch as our dedicated employee recreation floor, rooftopgarden, in-house cafeteria; to promoting positive interactionamongst employees and encouraging work-life balance.

To promote casual and open communication betweenemployees, we create a casual and open environment at workwhich is achieved by the design of our office spaces,management’s open door practices, and our 5-day dress-down policy.

We also try to facilitate closer relationships amongstemployees primarily through the Green Packet Group (GPG)Sports & Social Club which organizes events and activitiesthroughout the year. One of the key highlights of 2011 is theemployee dinner themed “Packeteers Evolution Nite”.

To encourage a healthy lifestyle, employees have access to a line-up of weekly sporting activities such as yoga, futsal,badminton and basketball. The GPG Sports & Social Club isalso responsible to create festive joy around the many culturalfestivities in the year to celebrate our diversity. The GPGSports & Social Club is run by employees of the Group on avoluntary basis with members elected by their peers annually.

CAPABILITY BUILDING

Developing our people is a key strategy to grow the Group business. Our dedicated Learning & Developmentdepartment continues to plan and organize in-house andexternal training programs based on the individual needs of our employees and in line with business requirements. GP Beyond, the Group’s e-learning platform carries a rich

resource of relevant training and development courses thatemployees can access at anytime and compete at their ownpace.

PHILANTHROPY

The GPG Sports & Social Club continues to champion theGroup’s philanthropic efforts as we believe they caneffectively represent our employees’ wishes on the causes tosupport being close to the ground.

The two staple activities that we organize annually continueto garner strong participation from our employees. There aretwo blood donation drives held in March and August tosupplement the low blood supply of a local public hospital:And our fourth consecutive showing for the annual Terry FoxRun to raise awareness and funds for cancer research heldin November.

COMMUNITY

In April 2011, P1 sponsored 10 WiMAX modems to connectSekolah Kebangsaan Damansara Utama (SKDU). Over 700students at SKDU benefited with ubiquitous wirelessbroadband connection in and around the school grounds.

ENVIRONMENT

We continue to work towards a greener Green Packet withworkplace energy saving initiatives and adoption of e-platforms at the workplace. To reduce cars on the road, theGroup continues to provide shuttle services for ouremployees to get to and from public transportation hubs.

• Our fourth year participation in the Terry

Fox Run

• P1 sponsored stu

dents at SKDU with

wireless broadband

connection.



Board Of Directors

Tan Sri Datuk Dr. Haji Omar Bin Abdul RahmanChairman / Independent Non-Executive Director

Puan Chan CheongGroup Managing Director / Chief Executive Officer

Nik Mat Bin IsmailExecutive Director / Vice President of Business Development

Tan Sri Dato’ Kok OnnNon-Independent Non-Executive Director

Ong Ju YanNon-Independent Non-Executive Director

Rami BazziNon-Independent Non-Excutive Director

Boey Tak KongIndependent Non-Executive Director

A. Shukor Bin S.A. KarimIndependent Non-Executive Director

Yee Chee Wai(Alternate Director to Ong Ju Yan)

Audit CommitteeBoey Tak Kong (Chairman)

Tan Sri Datuk Dr. Haji Omar Bin Abdul Rahman

A. Shukor Bin S.A. Karim

Nomination CommitteeTan Sri Datuk Dr. Haji Omar BinAbdul Rahman (Chairman)

Boey Tak Kong


Remuneration CommitteeTan Sri Datuk Dr. Haji Omar Bin Abdul Rahman (Chairman)

Ong Ju Yan

Puan Chan Cheong

Board Tender CommitteeBoey Tak Kong (Chairman)

Tan Sri Datuk Dr. Haji Omar Bin Abdul Rahman


Puan Chan Cheong

Liew Kok Seong

Company SecretaryTai Siew May (MAICSA 7015823)

Registered Office10th Floor, Menara Hap SengNo. 1 & 3, Jalan P. Ramlee50250 Kuala LumpurTel No. 603.2382 4288Fax No. 603.2382 4170

Head/Management OfficePacket Hub159, Jalan Templer46050 Petaling JayaSelangor Darul EhsanTel No. 603.7450 8888Fax No. 603.7450 8899

Share RegistrarSymphony Share Registrars Sdn. Bhd.Level 6, Symphony HousePusat Dagangan Dana 1Jalan PJU 1A/4647301 Petaling JayaSelangor Darul EhsanTel No. 603.7841 8000Fax No. 603.7841 8151/8152

Principal BankersHSBC Bank Malaysia Berhad2 Leboh Ampang50100 Kuala Lumpur

OCBC Bank (Malaysia) Berhad1A-A - 4A-A Jalan USJ10/1APusat Perniagaan USJ1047610 UEP Subang JayaSelangor Darul Ehsan

AuditorsMessrs Crowe HorwathChartered AccountantsLevel 16 Tower CMegan Avenue II12 Jalan Yap Kwan Seng50450 Kuala LumpurTel No. 603.2788 9999Fax No. 603.2788 9998

Stock Exchange ListingMain Market of Bursa Malaysia Securities BerhadStock & Warrant Name:GPACKET/GPACKET-WAStock & Warrant Code:0082/0082WA

Websitewww.greenpacket.com

Place of Register of Options is KeptLevel 10, Packet Hub159, Jalan Templer46050 Petaling JayaSelangor Darul EhsanTel No. 603.7450 8888Fax No. 603.7450 8899


100% Green Packet Berhad Taiwan Branch

100% Green Packet Networks (Taiwan) Pte Ltd

100% Green Packet(Shanghai) Ltd

100% Green Packet(Australia) Pty Ltd

100% Green Packet Networks(Singapore) Pte Ltd

100% Packet Interactive Sdn Bhd

100% Green Packet Networks S.P.C

100% Packet One Sdn Bhd

100% Green Packet International Sdn Bhd

100% Green Packet (L) Ltd

100% Next Telecommunications Sdn Bhd

100% Next Global Technology Sdn Bhd

70% First Wireless Sdn Bhd

100% Worldline Enterprise Sdn Bhd

71% Inova VenturePte Ltd

100% Green Packet (US) LLC

100% Green Packet Ventures Ltd

55% Packet One Networks (Malaysia) Sdn Bhd

100% NGT Networks Pte Ltd

100% Packet One (S) Pte Ltd

100% P1.Com Sdn Bhd100% Millercom Sdn Bhd

100% RuumzNation Sdn Bhd

100% Packet One (L) Ltd




2007 2008 2009 2010 2011

MYR '000 MYR '000 MYR '000 MYR '000 MYR '000

Profitability

Revenue 122,836 87,495 217,815 393,968 538,526Profit after Taxation 29,016 (60,294)1 (187,410) (255,563) (177,696)

Key Balance Sheet Items

Total Assets 470,546 682,281 970,316 952,109 985,290Total Liability 29,433 257,912 569,490 633,606 816,683Total Equity 441,113 424,369 400,826 318,503 168,607No. of Shares in Issue 333,279 399,935 657,304 657,753 657,753

Segmental Information

Revenue- Solution 65,940 13,680 61,039 154,132 221,874- Broadband Services - 8,8461 107,865 208,281 292,865- Communication/Voice Services 56,896 71,760 95,480 78,315 75,828- Elimination - (6,791) (46,569) (46,760) (52,041)

122,836 87,495 217,815 393,968 538,526

Profit Before Taxation by Pillar

- Solution 33,082 (13,321)2 (34,751)2 (15,419)2 12,583- Broadband Services - (24,883)1 (140,230) (173,692) (159,510)- Communication/Voice Services (54) (10,505)2 124 1,881 1,510- Finance Cost (372) (419) (10,050)3 (16,020)3 (32,364)3

- Share of Results of Associated Companies (1,664) (9,513) (669) (17,907)4 -- Unallocated expenses - - 614 (4,714) -

30,992 (58,641) (184,962) (225,871) (177,781)

Notes:1. The Broadband Services (P1) was launched in August 2008, resulting in its first revenue for the year. The significant

losses arose from substantial investment to roll out the infrastructures, resulting in higher depreciation cost. P1 alsoincurred substantial start-up costs in the initial years.

2. The losses arose mainly due to significant impairment made on certain non-core investment made in the previous years,i.e. First Wireless Sdn Bhd, GMO Global Limited and IWICS Inc.

3. Higher finance costs due to interests costs imputed on Irredeemable Convertible Preference Shares – LiabilitiesComponent.

4. The associated companies’ losses arose mainly due to impairment of its investment in China.



0

100

200

300

400

500

TOTAL EQUITY

2007 2008 2009 2010 2011

441 424401

319

169

0

200

400

600

800

1000

TOTAL LIABILITIES

2007 2008 2009 2010 2011

29

258

569634

817

0

200

400

600

800

1000

TOTAL ASSETS

2007 2008 2009 2010 2011

471

682

970 952 985

0

100

200

300

400

500

600

REVENUE

2007 2008 2009 2010 2011

12387

218

394

539

(RM MILLION)

(RM MILLION)

(RM MILLION)

(RM MILLION)



3 Nik Mat Bin IsmailExecutive Director / Vice President of Business Development

4 A. Shukor Bin S.A. KarimIndependent Non-Executive Director

1 Tan Sri Datuk Dr. Haji Omar Bin Abdul RahmanChairman / Independent Non-Executive Director

2 Puan Chan CheongGroup Managing Director / Chief Executive Officer

3

2

1

4



5 Rami BazziNon-Independent Non-Executive Director

6 Ong Ju YanNon-Independent Non-Executive Director

7 Tan Sri Dato’ Kok OnnNon-Independent Non-Executive Director

8 Boey Tak KongIndependent Non-Executive Director

9 Yee Chee Wai(Alternate Director to Ong Ju Yan)

7

8

9

5

6



profileof directors

Tan Sri Datuk Dr. Haji Omar Bin Abdul Rahman, a Malaysian, aged 79, was appointed the Chairman andIndependent Non-Executive Director of Green Packet Berhad(“the Company”) on 25 June 2004. He is also the Chairman ofthe Remuneration Committee, Nomination Committee and amember of the Audit Committee and Board Tender Committeeof the Company.

Tan Sri Omar started his professional career in 1960 inveterinary research after graduating in veterinary science fromthe University of Sydney and obtaining a Ph.D from theUniversity of Cambridge. In 1972, he was appointed theFounding Dean of the Faculty of Veterinary Medicine andAnimal Sciences and the first professor at the newlyestablished Universiti Pertanian Malaysia (UPM), nowUniversity Putra Malaysia. He played a major role in theestablishment phase of the university. His last position was asDeputy Vice Chancellor Academic Affairs.

In 1984, Tan Sri Omar was appointed to the new position ofScience Advisor in the Prime Minister’s Department. AsScience Advisor, he served on a number of nationalcommittees and initiated many programmes for enhancingtechnology management, increasing funding for Research &Development (“R&D”) and for commercialization of the resultsof research. He was the founder chairman of Technology ParkMalaysia Corporation (“TPM”), the Malaysian Industry-Government Group for High Technology (MIGHT), CompositeTechnology (Research) Malaysia Sdn Bhd (CTRM) andMalaysian Technology Development Corporation (MTDC).

Tan Sri Omar is the founding and current chairman of theLondon-based Commonwealth Partnership for TechnologyManagement Ltd (CPTM), Founding Fellow of the IslamicWorld Academy of Sciences, a Fellow of the Academy ofSciences for The Developing World (TWAS), an HonoraryFellow of the Academy of Science of Kyrgyzstan and theFounding President of the Academy of Sciences Malaysia. Hewas a member of the United Nations Advisory Committee onScience and Technology for Development, the ExecutiveCommittee for OIC Ministerial Standing Committee onScientific and Technological Cooperation and of theUNESCO’s International Scientific Council for Science andTechnology Policy Development. He is also the immediatepast President of the Federation of Asian Scientific Academiesand Societies (FASAS) and a member of UNESCO Committeeon Ethics of Science and Technology (COMEST).

His directorships in other public companies include KotraIndustries Berhad, Great Wall Plastic Industries Berhad, OSKVentures International Berhad, BCT Technology Berhad, GWPlastics Holdings Berhad AND Sabio Technology Berhad.

Tan Sri does not have any family relationship with any otherdirectors or major shareholders of the Company, has noconflict of interest with the Company and has not beenconvicted of any offences within the past ten (10) years, otherthan traffic offences, if any.

Tan Sri attended all six (6) Board Meetings of the Companyheld during the financial year under review.

Puan Chan Cheong, a Malaysian aged 44 was appointed asa Chief Executive Officer of the Company on 1 November 2003.He is also a member of the Remuneration Committee and theBoard Tender Committee of the Company.

Mr Puan is currently the Group Managing Director/ChiefExecutive Officer (“CEO”) of Green Packet Berhad (“GPB”), afully integrated mobile broadband player in the 4G space.GPB is both a technology developer of 4G software solutionsand devices for global telecommunications companies, and a 4GTelecommunications Company (Telco) offering convergedcommunications services in Malaysia via its subsidiary PacketOne Networks (Malaysia) Sdn Bhd (“P1”).

Under his stewardship, GPB is today the world’s third largestvendor for WiMAX devices and the No.1 connectionmanagement solutions provider in Asia. The Company’s 4GTelco, P1, is also Malaysia’s first and leading 4G wirelessbroadband service provider with the largest network andsubscriber base. GPB has operations in the United States ofAmerica (“USA”), Malaysia, Singapore, China, Taiwan,Australia, Bahrain, Hong Kong, Spain and Brazil.

A visionary and astute entrepreneur, Mr Puan co-founded andsits on the board of GPB, Green Packet Inc incorporated inthe USA, Green Packet International Inc and Green PacketHoldings Ltd. He also successfully steered GPB to its listingon Bursa Malaysia Securities Berhad’s MESDAQ Market on 25May 2005, and subsequently the Main Market on 18 July 2007.

TAN SRI DATUK DR. HAJI OMAR BIN ABDUL RAHMANChairman / Independent Non-Executive Director

PUAN CHAN CHEONGGroup Managing Director / Chief Executive Officer



profileof directors (cont’d)

Mr Puan has more than 18 years of diversified businessexperience with a strong success track-record in consulting,and the development and management of large-scaletelecommunications, infrastructure and property projectsinternationally. His personal accolades include the covetedPIKOM Technopreneur of the Year award.

He holds a Bachelor of Science in Business Administrationand a Bachelor Degree in Management Information Systems& Finance from University of Nebraska-Lincoln, USA.

Mr Puan is an indirect major shareholder of the Company. Hehas no conflict of interest except for certain recurrent relatedparty transactions of revenue or trading nature which arenecessary for the day-to-day operations of the Group. He hasnot been convicted of any offences within the past ten (10)years other than traffic offences, if any.

Mr Puan attended all six (6) Board Meetings of the Companyheld during the financial year under review.

Nik Mat Bin Ismail, a Malaysian, aged 48, was appointed asthe Executive Director of the Company on 3 September 2001.

Encik Nik is currently the Executive Director/Vice President ofBusiness Development of the Company. He has more than 16years experience in international business development, salesand marketing. He enjoys an extensive network of contactswithin the Government, local businesses and public listedcompanies. Prior to joining the Company, he was the GroupCEO and co-founder of the IBI Group of companies inMalaysia. He had first worked in the insurance industry as asenior executive with a global insurer before setting up the IBIGroup. He also sits in the Board of a few GPB wholly ownedsubsidiaries including GPN Network SPC Bahrain.He does nothold any directorship in any other public company.

He graduated with a Bachelor of Science in Accounting fromUtah State University, United States of America.

Encik Nik does not have any family relationship with any otherdirectors or major shareholders of the Company, has noconflict of interest with the Company and has not beenconvicted of any offences within the past ten (10) years, otherthan traffic offences, if any.

Encik Nik attended five (5) out of the six (6) Board Meetingsof the Company held during the financial year under review.

Tan Sri Dato’ Kok Onn, a Malaysian, aged 61, was appointedas the Non-Independent Non-Executive Director of theCompany on 15 December 2000.

Tan Sri Dato’ Kok Onn is the Managing Director cum ChiefExecutive Officer of Gadang Holdings Berhad (“Gadang”) acompany listed on the Second Board of Bursa MalaysiaSecurities Berhad (“Bursa Securities”) which wassubsequently transferred to the Main Board of BursaSecurities on 24 December 2007. He is the Chairman ofGadang’s Risk Management Committee and a member of theRemuneration and ESOS Committees. He has extensiveexperience and knowledge of the construction industry,having been involved with the industry for over 35 years in civiland engineering projects in Malaysia, China, Indonesia andthe Middle East.

Prior to joining Gadang, he was the Group Chief ExecutiveOfficer of Bridgecon Holding Berhad (“Bridgecon”). Tan SriDato’ Kok Onn was the person who transformed Bridgeconfrom a construction company to a group with activitiesinvolving property and resort development, toll expresswayoperations, manufacturing of readymixed concrete andquarrying.

Tan Sri Dato’ Kok Onn is an indirect major shareholder of theCompany. He has no conflict of interest except for certainrecurrent related party transactions of revenue or tradingnature which are necessary for the day-to-day operations ofthe Group. He has not been convicted of any offences withinthe past ten (10) years, other than traffic offences, if any.

Tan Sri Dato’ Kok Onn attended five (5) out of the six (6) BoardMeetings of the Company held during the financial year underreview.

Executive Director /Vice President of Business Development

NIK MAT BIN ISMAIL

Non-Independent Non-Executive Director

TAN SRI DATO’ KOK ONN




Ong Ju Yan, a Malaysian, aged 33, was appointed as theNon-Independent Non-Executive Director of the Company on3 April 2008. He is also a member of the RemunerationCommittee of the Company.

Mr Ong is currently the Chief Operating Officer and Head ofInvestment Banking for OSK Investment Bank Berhad. Hisresponsibilities include managing the Group’s investmentbanking and institutional securities businesses and handlingthe Group’s regional expansion and integration strategies. He has over 10 years of experience in financial services, having started his career with Morgan Stanley in New York and Singapore and later joining OSK Investment Bank inMalaysia where he maintains a regional management role.

Mr Ong holds a B.A. in Economics from Yale University andserved as Yale’s Country Director for Malaysia from 2005 to 2010.

Mr Ong was appointed as an Executive Director of OSKVentures International Berhad on 28 August 2006.

Mr Ong is the son of Ong Leong Huat @ Wong Joo Hwa, an indirect major shareholder of the Company and also a nominee director of OSK Technology Ventures Sdn Bhd.

Mr Ong does not have any conflict of interest with theCompany and he has not been convicted of any offenceswithin the past ten (10) years, other than traffic offences, if any.

Mr Ong attended all six (6) Board Meetings of the Companythat were held during the financial year under review.

Rami Bazzi, a Canadian, aged 41, was appointed as a Non-Independent Non-Executive Director of the Company on 16 February 2011.

Mr Bazzi is responsible for managing Sedco Holding's (“SH”)direct investment activities, looking after the development and management of strategic equity investments in privatecompanies in the Middle East and Africa (“MEA”) andSoutheast Asia.

He brings to the firm extensive experience in the areas of private equity, corporate strategy, shareholder valueimprovement, business valuation, M&A analysis, riskmanagement and credit risk.

Mr Bazzi joined SH from Injazat Capital, Dubai, UAE, wherehe was the Senior Executive Officer responsible for managingthe bank's private equity and advisory services. Prior to that, he was the CFO of LITAT Group, a regional commoditytrading group, where he was in charge of the group’sinvestments’ financing & negotiation and the restructuring ofthe organization.

Before that, Mr Bazzi worked with Deloitte Consulting inToronto, Canada, in the area of strategy and shareholder valueanalysis. He managed assignments for firms operating inNorth America, Europe and Asia. He covered variousindustries including telecom, pharmaceutical, automotive, oil& gas, aluminum manufacturing, and retail. He was appointedas subject matter expert in the area of shareholder value toCanada’s leading aerospace manufacturer, and the country’slargest oil refinery.

Prior to Deloitte, Mr Bazzi worked with the Royal BankFinancial Group in Toronto, Canada, in the areas of corporatecredit risk, financial policy, and strategy. He was responsiblefor managing a portfolio of corporate debt exceeding $3 billion.

Mr Bazzi’s directorship in other company includes CNA Groupas an alternate director.

Mr Bazzi earned a Master of Business in Administration and a Master of Science in Finance from Concordia University,Canada. He has also earned a Bachelor of Science inComputer Science from the Lebanese American University inLebanon, and is a Chartered Financial Analyst.

Mr Bazzi is a nominee director of PacificQuest, a majorshareholder of the Company. He does not have any conflict ofinterest with the Company and has not been convicted of anyoffences within the past ten (10) years, other than trafficoffences, if any.

Mr Bazzi attended five (5) out of the six (6) Board Meetings ofthe Company held during the financial year under review.

ONG JU YANNon-Independent Non-Executive Director

RAMI BAZZI






Boey Tak Kong, a Malaysian, aged 58, was appointed as theIndependent Non-Executive Director of the Company on 11 March 2005. He is the Chairman of the Audit Committee and the Board Tender Committee, besides serving as amember of the Nomination Committee of the Company.

He is a Fellow member of the Chartered Association ofCertified Accountants, United Kingdom, Associate member ofthe Institute of Chartered Secretaries & Administrators, UnitedKingdom, Chartered Accountant of the Malaysian Institute of Accountants, Member of the Malaysian Institute ofManagement and Associate member of the Institute ofMarketing Malaysia.

He has over 23 years of senior financial management, internalaudit and overseas business development experience with six(6) major listed groups with listing in Malaysia, UnitedKingdom, Singapore, Australia and New Zealand. He hasextensive expertise in developing and managing infrastructureprojects in China, Vietnam, Cambodia, Indonesia and thePhilippines.

He is currently the Managing Director of Terus Mesra Sdn Bhd, a strategic management and leadership development company. He is a regular speaker for the ContinuousEducation Programme for the Malaysian Institute ofAccountants, Association of Certified Accountants, theChartered Institute of Management Accountants and theInstitute of Internal Auditors Malaysia.

His directorships in listed public companies include DutchLady Milk Industries Berhad, IJM Land Berhad, GadangHoldings Berhad, Century Software Holdings Berhad andPermaju Industries Berhad. He is also a director of BunsengHoldings Berhad.

Mr Boey does not have any family relationship with any otherdirectors or major shareholders of the Company, has noconflict of interest with the Company and has not beenconvicted of any offences within the past ten (10) years, otherthan traffic offences, if any.

He attended all six (6) Board Meetings of the Company thatwere held during the financial year under review.

A. Shukor Bin S.A. Karim, a Malaysian, aged 56, wasappointed as the Independent Non-Executive Director of theCompany on 21 May 2008. He is also a member of the AuditCommittee, Nomination Committee and Board TenderCommittee of the Company.

Encik A. Shukor began his career with the Government ofMalaysia, Statistics Department in 1979. He left to join SapuraGroup in 1982 where he was one of the founder member ofSapura Information Technology (IT) and developed Sapura’sIT business to be one of Malaysia’s biggest IT company withmore than 1,000 employees and revenues exceeding RM600million per annum in the late nineties with more than 20subsidiaries involved in various aspects of the IT industry, fromsales and distribution, systems integration to softwaredevelopment and IT education.

He was also directly involved in the setting up of the AsiaPacific Institute of Information Technology (APIT) which istoday one of Malaysia’s biggest IT education institute.

Encik A. Shukor was deeply involved in the development ofthe IT Industry in Malaysia and served as Chairman ofPersatuan Industri Komputer Dan Multimedia, Malaysia(‘PIKOM’) from 1993 to 1995.

He graduated with a B Sc (Hons) in Computation from theUniversity of Manchaster, Institute of Science and Technology.

He is an Executive Director of Theta Edge Berhad which on the Main Board of Bursa Malaysia Securities Berhad (“BursaSecurities”).

Encik A. Shukor does not have any family relationship with anyother directors or major shareholders of the Company, has noconflict of interest with the Company and has not beenconvicted of any offences within the past ten (10) years, otherthan traffic offences, if any.

Encik A. Shukor attended all six (6) Board Meetings of theCompany held during the financial year under review.

Independent Non-Executive DirectorBOEY TAK KONG

Independent Non-Executive DirectorA. SHUKOR BIN S.A. KARIM




Yee Chee Wai, a Malaysian, aged 47, was appointed as theAlternate Director to Mr Ong Ju Yan on 3 April 2008. He is amember of both the Malaysian Institute of Accountants as aChartered Accountant and the Malaysian Institute of CertifiedPublic Accountant as a Certified Public Accountant. He hasbeen an investment banker with various investment banks inMalaysia from June 1991 to year 2007.

Upon graduation in 1984, he worked as an auditor with aninternational accounting firm based in Malaysia. He began hiscareer in the investment banking industry with Affin InvestmentBank Berhad and his last posting in the industry prior tojoining OSK Venture Equities Sdn. Bhd. in August 2007 waswith Public Investment Bank Berhad, where he worked formore than six (6) years as General Manager. He is theExecutive Director/Chief Operating Officer of OSK VentureEquities Sdn. Bhd. since March 2008.

He is a director of OSK Ventures International Berhad andmTouche Technology Berhad, all of which are listed on theACE Market of Bursa Malaysia. He is also a director of MaxwellInternational Holdings Berhad, which is listed on the MainMarket of Bursa Malaysia.

Mr Yee does not have any conflict of interest with the Companyand has not been convicted of any offences within the pastten (10) years, other than traffic offences, if any.

Mr Yee attended four (4) out of the six (6) Board Meetings ofthe Company held during the financial year under review.

YEE CHEE WAIAlternate Director to Ong Ju Yan



INDUSTRY OVERVIEW

2011 reflected a challenging yet exciting year for Green Packet Berhad and thetelecommunications industry as we were faced with the rapid rise in data consumption, steepcompetition, implementation of High Speed Broadband (HSBB) and the advent of newtechnologies such as LTE. Through all these, the government is on target, through the EconomicTransformation Programme (ETP), of achieving a knowledge-based economy and eventually, adeveloped nation status by 2020.

According to the ETP, the government will further improve the Communications Content andInfrastructure, which forms one of the twelve National Key Economic Areas. This boosted thenational broadband household penetration to 62% or four million of 6.5 million households in2011 - a further improvement from the commendable 54% penetration recorded in 2010. This isin line with the government’s target of reaching 75% broadband penetration nationwide by 2015,bridging the digital divide between rural and urban areas.

Studies have indicated the strong role of broadband in stimulating a country’s growth in grossdomestic product (GDP). In the Broadband Commission for Digital Development's report titledBroadband: A Platform for progress, the commission cited China as an example, where every10% increase in broadband penetration contributes an additional 2.5% to GDP growth. Thecommission also showed broadband creates new businesses and job opportunities.

As nations comprehend the importance of this, broadband take-up will rise. ManufacturerEricsson in its Traffic and Market Data Report revealed that global Mobile Broadbandsubscriptions have grown by 60% year-on-year and are now close to a total of 1 Billion. For thefirst time in 2011, we witnessed mobile data doubling the volume of voice traffic.

Dear shareholders,On behalf of the Board of Directors, themanagement team and Green Packet Groupemployees, I am pleased to present the AnnualReport and Audited Financial Statements of theGroup and the Company for the financial yearended 31 December 2011.



INDUSTRY OVERVIEW (CONT’D)

According to Cisco Visual Networking Index (VNI), the globalmobile internet data traffic will experience a steep climb of 18-fold from 2011 to 2016, translating into a compound annualgrowth rate (CAGR) of 78 percent spanning the forecastedperiod. By that time, data usage will reach 10.8 exabytes per month. The Asia-Pacific region will have a 21-fold growth, or 84 percent CAGR.

In 2011, Malaysian Internet users consumed up to 9.4GB ofdata a month. The study conducted by Informa Telecomsshowed that by 2015, Internet users in this region is predictedto consume up to 31.2GB of data each, per month. The worldis embracing a perpetual data tsunami and we must be readyfor it.

FINANCIAL PERFORMANCE

I am pleased to report that Green Packet Berhad’s (“TheGroup’s”) revenue as at 31 December, increased by 37% year-on-year to a cumulative total of RM539.6 million. This isthe first time we have crossed the half-a-billion Ringgit mark -a huge milestone for us as it is the largest revenue in ourhistory.

The Group recorded a net loss of RM180.8 million, animprovement over the previous year’s RM225.6 million. Theloss for the year was mainly due to investment in P1’s network,subscriber acquisition activities, and our focus to increasemarket share of the high growth nomadic broadband segment.Nevertheless, the lower losses in comparison to previous yearwere attributed to significantly higher revenue and stringentcost-saving strategies executed by the Group.

In 2011, we saw progressive improvements in both ourbusiness pillars with the Solutions Business revenue increasingto RM222 million from RM154 million in 2010 as a result ofsecuring new clients. Revenue for Packet One Networks(Malaysia) Sdn Bhd (“P1”) increased to RM293 million from theprevious year’s RM208 million owing to increased subscribersfor our 4G operator business.

The Solutions Business continued to grow strongly, recordingits fifth consecutive EBITDA (earnings before interest, taxes,depreciation and amortization) positive quarter at the end of 2011; its devices shipment reached 803,000 units whilesoftware shipped 742,000 licenses, registering a Y-o-Yincrease of 110% and 389%, respectively.

Similarly, the 4G network operator’s subscriber base grew by42% or 115,000 subscribers from 275,000 in 2010 to 388,000subscribers in 2011. P1 continued to achieve 13 consecutivequarters of increase in revenue by the end of the reportingyear.

CORPORATE DEVELOPMENTSIn 2011 the Group continued to experience growth through itsproven strategy and plan, demonstrating its commitment to a sustainable future of profitability in the light of a volatilelandscape.

SOLUTIONS BUSINESS

The Solutions Business experienced steady growth andenjoyed four consecutive quarters of profitability. Thatmomentum sees no sign of waning as it had demonstratedconsistent growth in global market share for software anddevice.

SECURING NEW CUSTOMER BASE

The Solutions Business continued to make steady progresstowards its goal of becoming a leading vendor to telcosworldwide, securing a number of wins with major global telcoplayers such as in the United States of America (USA),clinching a deal with Time Warner Cable, the second largestcable provider, for its Intouch Connection Management andWiFi Experience Management solution. The solution is alsobeing deployed by Hong Kong’s leading telecommunicationoperator, PCCW - a 3G and 4G communications andtechnology provider.

On the European front, the Solutions Business delivered theIntouch Connection Management Platform (ICMP) solution withseamless mobility to enable Mobile IP TV service for Telefonica,Spain’s largest telecommunication operator. On the WiMAXmodem front, Solutions Business secured deals with Aria (Italy’s largest WiMAX operator) and Max Telecom (Bulgaria’slargest WiMAX operator).

Similarly, in the Philippines, the Solutions Business signed anagreement with Smart Communications (Smart) for its winningICMP, enabling Smart to be the first Philippines operator tooffer converged connectivity across its 3G and WiFi accessnetworks.

message from the chairman (cont’d)

Solutions Business signs with Time Warner Cable. From feft Kelvin Lee, Sr GM, Green Packet Berhad; CC Puan, Group MD/CEO, Green PacketBerhad; Mike Roudi, Group Vice President, Wireless Services, Time WarnerCable; Vijay Venkateswaran, Sr Director, Mobile Data Product Management,Time Warner Cable; Erik Hanssen, VP of Worldwide Sales (software), GreenPacket Berhad.



SECURING NEW CUSTOMER BASE

In the Middle East, we clinched more deals such as the 2-yearcontract with Wateen Telecom, Pakistan’s leading WiMAXoperator serving 22% of the wireless broadband market inPakistan, for the supply of Green Packet’s award winning high-gain modem, the UH350.

We also made forays into Africa, consolidating our leadershipin the African WiMAX space after sealing a WiMAX modemsupply deal with Zimbabwe Internet and VoIP provider, ApticsTrading. The deal, of four contract-wins in under a year,signifies a market share of more than 35% of the Africanmobile WiMAX market. The African continent has shown theirappetite for broadband growth that cannot be ignored.

These deals will further strengthen our position in America,Europe, Africa and Asia.

PROVEN QUALITY PRODUCTS

The year also saw our Shuttle WiMAX USB Modem beingnominated for the German Design Awards 2012 under theProduct Design Category. The nomination comes as amilestone for the company, elevating us to a world-classstanding. Already, our Shuttle has won a series of renownedawards such as the ‘iF Product Design Award’ and ‘Product ofthe Year 2010’ by 4GWE for excellence in productperformance. The Shuttle redefines the next generation ofportable modems with its unique identity showcasingexcellence in both performance and design. It also supportsa wideband frequency range of 2.3GHz to 2.7GHz.

On top of that, the Solutions Business introduced the stylishand modern Green Packet Pocket Modem to capture thenomadic broadband market. The pocket modem will changethe way people live, work and play in the near future. Currently,it has garnered interest from operators in Southeast Asia,Europe and North America.

The Solutions Business also supplied its WiMAX PocketModem to schools in California, USA, as part of the California-state’s Digital Textbook Initiative (DTI). The first batch of theMF250 had benefited students, teachers and parents in KingsCounty School Districts (KCSD) to experience learning on-the-go.

LEADING TECHNOLOGIES

As the demand for mobile broadband continues to surge,service providers face the increasingly daunting task of trafficoffloading to fixed/Wi-Fi networks. In 2011, Cisco VNI reportsthat 11 percent, or 72 petabytes, per month of total mobiledata traffic was offloaded to fixed/Wi-Fi traffic, which was morethan 18 times greater than cellular traffic. By 2016, 22 percent,or 3.1 exabytes, per month of total mobile data traffic will beoffloaded. Without offloading, the 2011-2016 global mobiledata traffic CAGR would hit 84 percent.

The imminent broadband traffic trend presents itself as a long-term commitment for the Solutions Business to dataoffloading solutions. Our ICMP plays the essential dataoffloading role and has become a preferred connection anddata offload management solution of tier-1 telcos and manyare catching on. The ICMP intelligently switches between 3Gand WiFi network conditions, choosing the least congestedline to transmit data. Through the Interworking WLAN (IWLAN)Client for secured data offloading that helps offload datacongestion,by tethering data traffic from WiFi networks backto the 3G packet core. The solution has garnered goodresponse from operators in Europe and APAC leading tooperator trials.

Recently, we have successfully conducted our Inter OperabilityTesting (IOT) with 3GPP compliant Access Network Discoveryand Selection Function Policy servers. The success representsa strategic combination of client and server technologies thatenable end-to-end network deployment of dynamic dataoffload by operators globally, delivering seamless connectivityexperience to the end-user. The connectivity client solutionmakes it possible for operators to maintain and extendnetwork-level data traffic policies and controls on itssubscribers, even when they switch to WiFi networks.

CONVERGED COMMUNICATIONS SERVICESP1 CONTINUES TO IMPACT MORE MALAYSIANS

P1 is one of Malaysia’s fastest growing wireless broadbandservice providers in Malaysia. Its technological heritage isderived from our Solutions Business. We had a successful year,leapfrogging from a subscriber base of 274,000 in 2010 to388,000 in 2011.





CONVERGED COMMUNICATIONS SERVICESP1 CONTINUES TO IMPACT MORE MALAYSIANS (CONT’D)

This business pillar also achieved a commendable feat bydeploying nearly 600 base stations in 2011 - the highest in ourhistory; accumulating our total base stations to 1,500. Thefourth quarter enjoyed very high site rollout of 356 stationscompared with third quarter, representing a 328% Q-o-Qincrease. This is mainly attributable to timely execution andquick response to upgrading works, focusing on network depthand quality and team work.

Churn has improved as well to about 5.6%, which is close toindustry norm standards. The company has put in placeproper measures to better manage subscriber net addsaccording to site rollout. For 2011, we maintained a strongARPU due to better take up on higher value fixed wirelessbroadband packages outside the Klang Valley. Anothercontributing factor is today’s Malaysian surfing pattern thatseeks faster speeds and higher quota packages to satiatetheir broadband appetite.

EXCITING AND INTRIGUING MARKETING CAMPAIGNS

Amidst steep competition in 2011, P1 continues to generatecaptivating marketing ideas to constantly capture marketshare. The instant broadband campaign reflects ourMalaysian way of life for all things instant, such as instantnoodles for those who are on-the-go. Hundreds of thousandsof P1 users are enjoying P1’s instant plug and play 4Gservices at home and on-the-go at great value for money.

It subsequently launched a series of print advertisements tocommunicate its complete broadband services, educatingconsumers on choosing the ‘best-fit’ P1 4G service packagebased on individual usage pattern and lifestyle needs.

Soon after, the One Plan™ was unveiled in the middle of 2011based on a research conducted by Frost and Sullivan, whichshowed 93% of broadband users in Malaysia compromisedtheir broadband experience by using their mobile dongles athome and were frustrated with their broadband services. Withthe One Plan™, customers get a 3-in-1 value proposition ofhaving two modems and voice package. For modems, wehave the powerful 4G home modem with WiFi and a nifty P14G on-the-go modem, catered specifically for the nomadicmarket. On top of that, consumers also get a shared quota ofup to 30GB, which is a rare gem in the market.

In 2011, nomadic grew 15% to reach nearly 40% of our totalsubscribers. With this insight, the company will continue toformulate strategies that will capture a sizeable piece of thismarket segment.

LEADING THE WAY IN 4G TD-LTE

P1 is working hard to deploy both powers of 4G WiMAX and TD-LTE technologies into one single platform, asdemonstrated live to members of the Malaysian media, withits 4G vendor partner ZTE Corporation. The demonstrationshowed that both 4G technologies are supported on the sameplatform and most importantly, the ease of transitioning from4G WiMAX to TD-LTE. Until the market is ready for TD-LTE, P1will continue to develop and expand 4G WiMAX as it iscurrently the most commercially mature and available 4Gtechnology available.

Our commitment to a dual WiMAX/TD-LTE ecosystem is furthershown through the establishment of Southeast Asia’s first andonly 4G Experience Centre in our headquarters here in PacketHub. This is realized with the signing between Packet One International, a subsidiary of Packet One, and ZTECorporation, and with the support of China Mobile. Once upand running in early 2012, customers in search of ‘real deal’wireless 4G speeds can come and experience for themselveswireless speeds of more than 120 Mbps.

STRATEGIC COLLABORATIONS

P1 has collaborated with anumber of key industryplayers, such as QualcommInc, the world’s largest mobile chipset manufacturer,to explore the future of TD-LTE deployment inSoutheast Asia. Both partiesagreed to exchange andshare knowledge on TD-LTEpertaining to infrastructureand device suppliers,network optimization toolsand applications in hope tospeed up the LTE ecosystemadoption.

In addition to that, P1 has committed to work with the French-based Sequans Communications to develop dual-modeWiMAX/TD-LTE chipsets. Through this collaboration, P1 havebeen conducting tests, utilizing Sequans’ equipment to transitsmoothly from 4G WiMAX to TD-LTE, which is already a part ofthe latter’s 4sight program.

Michael Lai, CEO of P1, explaining thefeatures of the remote radio unit, theWiMAX & LTE backhaul hardware at alive demo in Port Dickson.



messagefrom the chairman (cont’d)

STRATEGIC COLLABORATIONS (CONT’D)

The year also saw P1 collaborating with ENT Broadband,manufacturer of the AXIA Internet protocol private branchexchange to help local businesses to significantly reduceinternational roaming charges through the P1 Next GenerationVoice Session Initiation Protocol Trunking Service (SIPTrunking), enabling P1 in targeting the business marketssegment.

Meanwhile, the relationship with our strategic alliance, SKTelecom has grown strong, since June 2010. South Korea’slargest mobile telco further invested another RM50 million into P1 to accelerate its 4G/TD-LTE network expansion. This increased SK Telecom’s shareholding in P1 to 25.97%.

JOINING IN THE RANKS OF GTI

Despite a small player in comparison with legacy telcos, P1was invited to join the ranks in the Global TD-LTE Initiative(GTI) to champion the technology together with global telcosnamely China Mobile, Bharti Airtel, Softbank, Clearwire,Vodafone among others. GTI is a platform formed to createvalue for stakeholders across the TD-LTE ecosystem and drivethe early adoption of the technology. P1 will benefit and addvalue to this initiative as it has the most matured 4Gtechnology in available in Southeast Asia.

In tandem with GTI, P1 had also teamed up with China Mobile,the world’s largest telco in terms of subscriber base, to drivethe adoption of the TD-LTE technology. The collaboration willbe an effective and strong platform as both parties share thesame vision of LTE driving the way forward in mobilebroadband.

In tandem with GTI, P1 had also teamed up with China Mobile,the world’s largest telco in terms of subscriber base, to drivethe adoption of the TD-LTE technology. The collaboration willbe an effective and strong platform as both parties share thesame vision of LTE driving the way forward in mobilebroadband.

IMPROVING NETWORK AND COVERAGE

As highlighted earlier, P1 places the highest priority when it comes to network expansion and for 2011, we managed tobuild nearly 600 additional sites; almost doubling the numberwe achieved in the previous year.

One of the factors contributing to this success is signing the agreement with eight State-backed companies under theumbrella of Persatuan Penyedia Infrastruktur Telekomunikasi. The agreement allows us to boost our rollout execution in afaster and more efficient manner.

Another significant factor to the expansion of our network isthe improvement in various rollout processes, such asdiversifying our rollout vendors.

MOVING INTO THE HSBB ARENA

In terms of expanding its business markets services, P1signed a deal with TM to accelerate high speed broadband(HSBB) to more Malaysians. We believe that we have anunparalleled offering that gives customers the best of bothworlds - 4G in the air and fiber on the ground. We are excitedto be offering our customers this new HSBB services in 2012.

HSBB will allow P1 to offer fiber services to 1.3 million householdsin the Klang Valley, Johor Bahru and Penang, givingMalaysians a wider choice of broadband that suit their needs.It would also allow us to offer high value packages toMalaysians. Our fiber service will be extended to small andmedium businesses as well.

FORWARD GROWTH

There is no doubt, both pillars will continue to grow rapidlyand key measures are ensured for a sustainable future.

The Solutions Business is already recognised worldwide as a leading 4G developer, being Asia’s number one leader inConnection Management software and one of the world’sleading vendor of 4G/WiMAX devices. We will be lookingforward to strengthening our position. The year 2012 andbeyond will be an exciting and promising period, marking it asignificant and historic in Green Packet’s journey.

The Solutions Business is already in the midst of conductingextensive research and development in-line with the LTEproliferation, building a comprehensive portfolio to serve theimpending growth and demand for its LTE devices andsoftware. The Solutions Business will also continue to exploredifferent markets, introducing new network and devicesolutions that cater to the relevant needs of its customers. Wehave the advantage in cost and technological advancement.This will be a pull factor that key accounts look out for.

While many operators are making a global decision to buildingthe LTE ecosystem and as it’s waiting to be ready, theSolutions Business would already have a comprehensiveportfolio to serve the impending growth and demand for itsLTE devices and software. We will also be realigning ourbusiness priorities, shifting our focus to data offloadmanagement, which is still in its infancy.




FORWARD GROWTH (CONT’D)

On the converged communications services pillar, P1 willcontinue to thrive and expand. For the past 3 years, we haveintroduced Malaysians to a fast 4G wireless broadband andfixed line for voice. As the first and leading WiMAX operatorin Malaysia, P1 weaved into a highly competitive landscapewith many legacy telcos having strong financial backings, Imust admit that we have managed well and enjoyed a run ofsuccess.

For 2012, one of the areas we will be focusing is to grow theVoice, HSBB and Small Medium Enterprise (SME) market. We will be expanding our network coverage from the current53% to 65% of the population over the next two years,reaching out to keen broadband users in East Malaysia whodesire real 4G speeds. Part of our key rollout strategy is to beef up our 4G network to TD-TLE.

APPRECIATION

I wish to thank the Management and employees for theircontinuous efforts and dedication in bringing the Group togreater heights. As the competition grows fiercer andresources are limited, we will continue to gather and maximize

our pool of talents to learn and grow, ensuring that we remaina force to reckon with.I would also like to thank our business partners and vendorsfor their support.

A big warm extension of gratitude towards the Government ofMalaysia who has been very supportive of the industry andbusiness operators. We stand together with the governmentin realizing its vision of a knowledge-based nation thanks to asound broadband infrastructure and system.

Finally, I thank my fellow directors for their support to andcontribution to the Board.

TAN SRI DATUK DR. HAJI OMAR BIN ABDUL RAHMANChairman / Independent Non-Executive Director

23 May 2012

This chairman’s message includes “forward-looking statements”within the meaning of the securities laws. Statements in thismessage that are not historical facts are forward-lookingstatements. The words “estimate,” “forecast,” “intend,”“expect,” “believe,” “target,” and similar expressions areintended to identify forward-looking statements. Forward-looking statements are projections reflecting board’s andmanagement’s judgment and assumptions based on currentlyavailable information and involve a number of risks anduncertainties that could cause actual results to differ materiallyfrom those suggested by the forward-looking statements.

Future performance cannot be assured. Actual results maydiffer materially from those in the forward-looking statementsdue to a variety of factors, including, but not limited to:

• the changes in the regulatory environment in Malaysiaand in countries which Green Packet does business;

• uncertainties related to the implementation of thecompany’s 4G Operator business strategy;

• the costs and business risks associated with deployinga 4G network and offering products and servicesutilizing 4G technology;

• the inability of third party suppliers, software developersand other vendors to perform requirements and satisfyobligations, under agreements with the Green PacketGroup;

• the impact of adverse network performance; and

• other risks referenced from time to time in the company’sfilings with the Securities and Exchange Commission.

Green Packet believes the forward-looking statements in theChairman’s Message are reasonable; however, you should notplace undue reliance on forward-looking statements, whichare based on current expectations as of the date of this annualreport. Green Packet is not obligated to publicly release anyrevisions to forward-looking statements to reflect events afterthe date of this annual report.



statement

on corporate governance

The Board of Directors (“the Board”) of Green Packet Berhad (“GPB” or “the Company”) recognises and subscribes to theimportance of the principles and best practices set out in the Malaysian Code on Corporate Governance (“the Code”) as a keyfactor towards achieving an optimal governance framework and process in managing the business and operational activitiesof the Company.

The Board believes that good corporate governance practices are pivotal to enhancing shareholders’ value. Hence, the Boardis fully dedicated to continuously evaluate GPB Group (“the Group”)’s corporate governance practices and procedures toensure that the principles and best practices in corporate governance are applied and adhered to in the best interests of thestakeholders.

The Statement below sets out the manner in which the Group has applied the principles of the Code and the extent ofcompliance with best practices advocated therein.

BOARD OF DIRECTORS

1. The Board

The Group is driven by an effective Board (“the Board”) consisting of competent individuals with appropriate specializedskills and knowledge to ensure capable management of the Group. The Board is responsible for overseeing the conductand performance of the Group’s business and oversees the Group’s internal controls. The compositions of theindependent and non-independent directors are carefully considered to ensure that the Board is well balanced.

The Board acknowledges its key responsibilities in directing the strategic plans, development and control of the Groupand has taken steps to adopt the specific responsibilities listed by the Code, which facilitates the discharge of the Board’sstewardship responsibilities.

The Board has established four (4) Board Committees to which it has delegated certain of its responsibilities. They areAudit Committee, Nomination Committee, Remuneration Committee and Board Tender Committee. All Board Committeeshave their roles/functions, written terms of reference, operating procedures and authorities clearly defined. The Boardreviews the Board Committees’ authority and terms of reference from time to time.

2. Composition and Balance

The Board currently has eight (8) members, comprising three (3) Independent Non-Executive Directors, three (3) Non-Independent Non-Executive Directors and two (2) Executive Directors. The composition of the Board complied withparagraph 15.02 of the Main Market Listing Requirements of the Bursa Malaysia Securities Berhad (“Bursa Securities”).It is a well-balanced Board and comprises professionals from various backgrounds with the relevant experience andexpertise that would add value to the Group. The mix of experience is vital for the strategic success of the Group.

The presence of the independent non-executive directors fulfills a pivotal role in corporate accountability as they provideindependent views, advice and judgement.

The members of the Board are as follows:

Tan Sri Datuk Dr. Haji Omar Bin Abdul RahmanChairman / Independent Non-Executive Director

Puan Chan CheongGroup Managing Director / Chief Executive Officer

Nik Mat Bin IsmailExecutive Director / Vice President of Business Development



statement

on corporate governance (cont’d)

BOARD OF DIRECTORS (CONT’D)

2. Composition and Balance (cont’d)

Tan Sri Dato’ Kok OnnNon-Independent Non-Executive Director

Ong Ju YanNon-Independent Non-Executive Director

Rami RazziNon-Independent Non-Executive Director

Boey Tak KongIndependent Non-Executive Director

A. Shukor Bin S.A. KarimIndependent Non-Executive Director

Yee Chee Wai(Alternate Director to Ong Ju Yan)

The details of the Directors’ profile and their respective memberships, please refer to pages 22 to 26 of this AnnualReport.

There is a clear division of responsibilities between the Chairman and Group Managing Director to ensure that there isbalance of power and authority. In ensuring this balance, the positions of the Chairman and Group Managing Directorare held by separate members of the Board. The Board has appointed Mr Boey Tak Kong as Senior Independent Non-Executive Director to whom concerns may be conveyed.

3. Board Meetings

The Board meets at least four (4) times a year on a quarterly basis, with additional meetings convened when necessary.Agenda and Board papers are circulated to the Board prior to the Board meetings so as to give the Directors time toconsider and deliberate on the issues to be raised at the meetings in relation to the Group’s financial performance,corporate development, strategic issues and business plan.

There were six (6) Board Meetings held during the financial year ended 31 December 2011. Details of each Director’sattendance of the Board meetings held are as follows:

Name of Director Designation Meeting attended

Tan Sri Datuk Dr. Haji Omar Independent Non-Executive Director 6/6Bin Abdul Rahman

Puan Chan Cheong Executive Director 6/6

Nik Mat Bin Ismail Executive Director 5/6

Tan Sri Dato’ Kok Onn Non-Executive Director 5/6

Ong Ju Yan Non-Executive Director 6/6

Rami Bazzi Non-Executive Director 5/6

Boey Tak Kong Independent Non-Executive Director 6/6

A. Shukor Bin S.A. Karim Independent Non-Executive Director 6/6

Yee Chee Wai (Alternate Director to Ong Ju Yan) 4/6



statement



4. Directors’ Training

All the Directors had attended and successfully completed the Mandatory Accreditation Programme as prescribed byBursa Securities.

The Group acknowledges that continuous education is vital for the Board to discharge its responsibilities effectively. The Directors are encouraged to attend appropriate external trainings and where applicable to the Company.

Directors who were unable to attend any formal training during the financial year, are well-informed of the latestdevelopments on the various relevant rules and regulations as all Directors were updated by the Management, by providing them with reading materials on such new developments.

During the financial year, the Directors attended the following training programmes/seminars:

Name of Director Details of Programme

Tan Sri Datuk Dr. Haji Omar • Half Day Governance Program – Assessing the Risk and Control Environment Bin Abdul Rahman • An invitation to directors to attend the Corporate Integrity Launch by Dato’ Seri

Idris Jala• Board Responsibility for Corporate Culture – Selected Governance Concerns

& Tools for Addressing Corporate Culture and Board Performance• Driving The Corporate Governance Agenda• The Securities Commission’s New Corporate Governance Blueprint – What Does

It Mean For Your Company• Corporate Governance Blueprint 2011 – Towards Excellence in Corporate Governance

Puan Chan Cheong • Corporate Governance Blueprint 2011 – Towards Excellence in Corporate Governance• Silicon Valley Comes to Malaysia • LTE TDD/FDD International Summit• Asia Pacific Technology, Media & Telecommunications Conference 2011

Nik Mat Bin Ismail • Corporate Governance Blueprint 2011 – Towards Excellence in Corporate Governance

Tan Sri Dato’ Kok Onn • Drawing A New Roadmap For Growth – Going Beyond Traditional• Corporate Governance Blueprint 2011 – Towards Excellence in Corporate Governance• Improving The Budget Process for Effective High Performance

Ong Ju Yan • Media Training• Forum on New Takeovers & Mergers Code• Anti Money Laundering Act• MIBA Lecture: Investment Banking in the Post Crisis World• ASEAN Exchanges Collaboration: The ASEAN Link Network• Corporate Governance Blueprint 2011 – Towards Excellence in Corporate Governance• PEMANDU Lecture on The Economic Transformation Programme, A One Year Report• Internal Capital Adequancy Assessment Process (ICAAP) and BASEL III



statement



4. Directors’ Training (cont’d)

Name of Director Details of Programme

Boey Tak Kong • Powering Business Sustainability• Future Vision Series For Leaders – Preparing For Tomorrow Today• Corporate Governance “Assessing The Risk and Control Environment”• Related Party Transactions: What Directors & Investors Need To Know• Talk on “Whistleblower Protection Act 2010, Personal Data Protection Act 2010

& Price Control & Anti-Profiteering Act 2011” by Raja, Darryl & Loh Advocates & Solicitors

• Directors & Officers Liability: Are You Exposed: by ACE Synergy Insurance and MP Insurance Brokers Berhad

• Annual Conference 2011 - Governing Responsibly: Inevitable Changes• Chindia Rising - How China and India Can Help Your Business• ICAA-MICPA Forum - Improving Corporate Governance In Malaysian Capital

Markets - The Role Of Audit Committee• Corporate Governance Blueprint 2011• Updates on Budget 2011• Managing Corporate Reputation In Digital Age• Competition Act 2010• Corporate Governance + Corporate Responsibility + Innovation - The Building

Blocks For Economic Prosperity• Risk Management & Internal Controls - Are the Boards aware what they are

up against?• Challenges Faced By Accountants As Independent Directors

A. Shukor Bin S.A. Karim • Corporate Governance Blueprint 2011 - Towards Excellence in Corporate Governance

Yee Chee Wai • Board Responsibility for Corporate Culture - Selected Governance Concerns & Toolsfor Addressing Corporate Culture and Board Performance

• Corporate Governance Blueprint 2011 - Towards Excellence in Corporate Governance• HKTDC Invitation to Financial Seminar• MVCA Brunch Networking Session III• Brunch Networking Session IV (KOTRA)• Advocacy Sessions on Disclosure for CEO's and CFO's• Kuala Lumpur International Venture Capital Symposium 2011 - "Risk Taking -

A Paradigm Shift"• Workshop on Private Equity• Living OSK's Brand Values

5. Director’s Remuneration

The Directors’ remuneration of the Company for the financial year ended 31 December 2011 is as follows:-

Salary Directors’ Fee Other Emoluments Total(RM) (RM) (RM) (RM)

Executive DirectorsPuan Chan Cheong 600,000 - 160,610 760,610Nik Mat Bin Ismail 284,130 - 333,975 618,105

884,130 494,585 1,378,715



statement



5. Director’s Remuneration (cont’d)

The Directors’ remuneration of the Company for the financial year ended 31 December 2011 is as follows:-

Salary Directors’ Fee Other Emoluments Total(RM) (RM) (RM) (RM)

Non-Executive DirectorsTan Sri Datuk Dr. Haji Omar Bin Abdul Rahman - 77,176 7,000 84,176Tan Sri Dato’ Kok Onn - 27,562 2,500 30,062Ong Ju Yan - 27,562 3,500 31,062Rami Bazzi - 27,562 2,500 30,062Boey Tak Kong - 60,638 7,500 68,138A. Shukor Bin S.A. Karim - 27,562 7,500 35,062

248,062 30,500 278,562

Total 884,130 248,062 525,085 1,657,277

6. Supply of Information

The Directors have full unrestricted and timely access to all information necessary for the discharge of theirresponsibilities. The Board is provided with the meeting agenda and Board papers to enable them to consider the mattersarising and facilitate informed decision making. The Board papers, amongst others include matters pertaining tooperational, financial, corporate, performance, business development, audit as well as updates on market information,statutory regulations and requirements affecting the Group.

In addition, there is a formal schedule of matters reserved specifically for the Board’s decisions. These are generallysignificant matters relating to the business operations of the Group.

All Directors, whether as a full Board or in their individual capacity, have access to the advice and services of CompanySecretaries. The Company Secretaries also act as the Secretary for all the Board Committees. The Directors may obtainindependent professional advice in furtherance of their duties.

BOARD COMMITTEES

1. Audit Committee

The Board’s obligation to establish formal and transparent arrangements in considering how it should apply financialreporting and internal control principles, and maintaining an appropriate relationship with the Company’s external auditors,Crowe Horwath is met through the Audit Committee (“AC”).

All members of the AC are Non-Executive Directors and Mr Boey Tak Kong fulfils the financial expertise requisite of theListing Requirements.

The members of the AC are as follows:

Boey Tak Kong - Chairman/Independent Non-Executive DirectorTan Sri Datuk Dr. Haji Omar Bin Abdul Rahman - Independent Non-Executive DirectorA. Shukor Bin S.A. Karim - Independent Non-Executive Director

Details on function, composition, membership and summary of the activities of the Audit Committee during the year areset out in the Audit Committee Report on pages 40 to 43 of this Annual Report.



statement


2. Nomination Committee

The Nomination Committee (“NC”) is responsible for proposing candidates for directorship and assessing the directorson an on-going basis. In addition, NC assesses the contribution of individual Board members, the effectiveness of theBoard and the Board Committees.

The members of the NC are as follows:

Tan Sri Datuk Dr. Haji Omar Bin Abdul Rahman - Chairman/Independent Non-Executive Director Boey Tak Kong - Independent Non-Executive DirectorA. Shukor Bin S.A. Karim - Independent Non-Executive Director

The NC met once during the financial year to review the Board’s structure, size and composition.

The duties and responsibilities are spelt out in the Terms of Reference of the Nomination Committee.

The Company’s Articles of Association provides that Directors who are appointed during the year shall retire from officeand be subject to re-election by shareholders at the annual general meeting. At every annual general meeting, at leastone-third (1/3) of the Board are subject to retirement and re-election by rotation at least once in every three (3) years. In addition, a Director who attains the age over 70 retires at every annual general meeting pursuant to the CompaniesAct, 1965.

3. Remuneration Committee

The Company has adopted the objective as recommended by the Code to determine the remuneration of the Directorsso as to ensure that the Company attracts, retains and motivates the Directors of the quality needed to manage thebusiness of the Group effectively. The remuneration scheme is reflective of the individual Director’s experience and levelof responsibilities. In addition, the remuneration for Executive Directors is structured to link rewards to corporate andindividual performance.

The Remuneration Committee (“RC”) is responsible for recommending the remuneration scheme for Directors. The remuneration packages of all Directors shall be devised to attract, retain and motivate them, and is reflective of theindividual Director’s experience and responsibilities. None of the Executive Directors participate in any way in determiningtheir individual remuneration packages. The remuneration of Non-Executive Directors are determined by the Board as awhole with the individual Directors concerned abstaining from deliberation and voting on their own remuneration.

The members of the RC are as follows:

Tan Sri Datuk Dr. Haji Omar Bin Abdul Rahman - Chairman/Independent Non-Executive DirectorOng Ju Yan - Non-Independent Non-Executive Director Puan Chan Cheong - Group Managing Director/Chief Executive Officer

The RC met once during the financial year to review the remuneration of Executive Directors.

The duties and responsibilities are spelt out in the Terms of Reference of the Remuneration Committee.



statement


BOARD COMMITTEES (CONT’D)

4. Board Tender Committee

The Board Tender Committee (“BTC”) is responsible for reviewing and reporting to the Board on approval of all relevanttenders and procurement contracts with an estimated value of RM10 million and up to RM20 million and makingrecommendations for Board approval for tenders and procurement contracts with an estimated value of exceeding RM20 million.

The current members of the BTC are as follows:

Boey Tak Kong - Chairman/Independent Non-Executive DirectorTan Sri Datuk Dr. Haji Omar Bin Abdul Rahman - Independent Non-Executive DirectorA. Shukor Bin S.A. Karim - Independent Non-Executive DirectorPuan Chan Cheong - ManagementLiew Kok Seong - Management

The BTC had since held three (3) meetings during the financial year.

SHAREHOLDERS

1. Investors Relations and Shareholders’ Communication

The Board recognises the need for shareholders to be informed of all material business matters affecting the Group. In addition to various announcements made during the year, the timely release of financial results on a quarterly basis,press releases and annual report provides shareholders with an overview of the Group’s performance and operations.

2. Annual General Meeting (“AGM”)

The AGM is the principal forum for dialogue and communication with shareholders and investors. Shareholders areencouraged to attend and participate during the AGM in the question and answer session on the prospects, performanceof the Group and other matters of concern. Members of the Board, Heads of Department and the auditors are present toanswer questions raised at the meeting. Suggestions and comments raised by shareholders are also noted forconsideration. Shareholders who are unable to attend are allowed to appoint proxy/proxies to attend and vote on theirbehalf.

ACCOUNTABILITY AND AUDIT

1. Financial Reporting

The Board endeavour to provide and present a balanced and meaningful assessment of the Group’s financialperformance and prospects to shareholders, primarily through the annual reports, quarterly announcements of the Group’sresults and other price-sensitive public reports. The Board is assisted by the Audit Committee in overseeing the Group’sfinancial reporting processes and the accuracy, consistency and appropriateness of the use and application of accounting policies and standards, as well as the reasonableness and prudence in making estimates, statements andexplanations.

2. Internal Control

The Statement on Internal Control of the Group is set out on pages 44 to 45 of this Annual Report. The Statement providesan overview of the Group’s approach in maintaining a sound system of internal control to safeguard shareholders’investment and the Group’s assets.



audit

committee report

The Audit Committee (“the Committee”) was established on 11 March 2005. During the financial year under review, the Committee met five (5) times and the details of the attendance of the Committee members are set out as follows:

COMPOSITION OF THE AUDIT COMMITTEE

Name Attendance

Boey Tak Kong (Chairman) 5/5Independent Non-Executive Director

Tan Sri Datuk Dr. Haji Omar Bin Abdul Rahman 4/5Independent Non-Executive Director

A. Shukor Bin S.A. Karim 5/5Independent Non-Executive Director

Details of the members of the Committee are contained in the “Directors’ Profile” as set out on pages 22 and 25 of this AnnualReport.

TERMS OF REFERENCE

The Committee is governed by the following terms of reference:

1. Composition

The Committee shall be appointed from amongst the Board and shall comprise no fewer than three (3) members. All theaudit committee members must be non-executive directors, a majority of whom shall be independent directors and atleast one (1) member must be a member of the Malaysian Institute of Accountants or possess such other qualificationsand/or experience as approved by the Bursa Malaysia Securities Berhad (“Bursa Securities”). No alternate director ofthe Board shall be appointed as a member of the Audit Committee. The Audit Committee Chairman, Mr Boey Tak Kongis a Chartered Accountant of the Malaysian Institute of Accountants.

In the event of any vacancy with the result that the number of members is reduced to below three, the vacancy shall befilled within two (2) months but in any case not later than three (3) months. Therefore a member of the Committee whowishes to retire or resign should provide sufficient written notice to the Company so that a replacement may be appointedbefore he leaves.

2. Chairman

The Chairman, who shall be elected by the Committee, shall be an independent director.

3. Secretary

The Company Secretary shall be the Secretary of the Committee and shall be responsible, in conjunction with theChairman, for drawing up the agenda and circulating it prior to each meeting.

The Secretary shall also be responsible for keeping the minutes of meetings of the Committee and circulating them tothe Committee Members. The Committee Members may inspect the minutes of the Committee at the Registered Office orsuch other place as may be determined by the Committee.



audit

committee report (cont’d)

TERMS OF REFERENCE (CONT’D)

4. Meetings

The Committee shall meet at least four (4) times in each financial year. The quorum for a meeting shall be two (2) members,provided that the majority of members present at the meeting shall be independent.

The Committee may call for a meeting as and when required with reasonable notice as the Committee Members deemfit. The Committee Members may participate in a meeting by means of conference telephone, conference videophone orany similar or other communications equipment by means of which all persons participating in the meeting can hear eachother. Such participation in a meeting shall constitute presence in person at such meeting.

All decisions at such meeting shall be decided on a show of hands on a majority of votes.

The internal auditors and external auditors may attend at any meeting at the invitation of the Committee and shall appearbefore the Committee when required to do so by the Committee. The internal auditors and external auditors may alsorequest a meeting if they consider it necessary.

5. Rights

The Committee shall:

(a) have authority to investigate any matter within its terms of reference;(b) have the resources which are required to perform its duties;(c) have full and unrestricted access to any information pertaining to the Group;(d) have direct communication channels with the external auditors and person(s) carrying out the internal audit function

or activity;(e) have the right to obtain independent professional or other advice at the Company’s expense;(f) have the right to convene meetings with the internal auditors and external auditors, excluding the attendance

of other directors or employees of the Group, whenever deemed necessary;(g) promptly report to the Bursa Securities, or such other name(s) as may be adopted by Bursa Securities, matters

which have not been satisfactorily resolved by the Board of Directors resulting in a breach of the ListingRequirements;

(h) have the right to pass resolutions by a simple majority vote by the Committee and that the Chairman shall have thecasting vote should a tie arise;

(i) meet as and when required on a reasonable notice;(j) the Chairman shall call for a meeting upon the request of the internal auditors and external auditors.

6. Duties

(a) To review with the external auditors on:• the audit plan, its scope and nature;• the audit report;• the results of their evaluation of the accounting policies and systems of internal accounting controls within

the Group; and• the assistance given by the officers of the Company to external auditors, including any difficulties or disputes

with Management encountered during the audit.



audit


TERMS OF REFERENCE (CONT’D)

6. Duties (cont’d)

(b) To review the adequacy of the scope, functions, competency, resources and set the standards of the internal auditfunction.

(c) To provide assurance to the Board of Directors on the effectiveness of the system of internal control and riskmanagement practices of the Group.

(d) To review the internal audit programme, ascertain the results of the internal audit programme, determine theinvestigation undertaken and whether or not appropriate action is taken on the recommendations of the internalauditors.

(e) To review with management:• audit reports and management letter issued by the external auditors and the implementation of audit

recommendations;• interim financial information; and• the assistance given by the officers of the Company to external auditors.

(f) To monitor related party transactions entered into by the Company or the Group and to determine if suchtransactions are undertaken on;• at arm’s length basis• normal commercial terms• terms not more favourable to the related parties than those generally available to the public• to ensure that the Directors report such transactions annually to shareholders via the annual report• to review conflicts of interest that may arise within the Company or the Group including any transaction,

procedure or course of conduct that raises questions of management integrity.

(g) To review the quarterly reports on consolidated results and annual financial statements prior to submission to theBoard of Directors, focusing particularly on:• any changes in or implementation of major accounting policy and practices;• compliance with accounting standards and other legal requirements; • significant adjustments resulting from the audit;• the going concern assumption; and• compliance with accounting standards and other legal requirements.

(h) To consider the appointment and/or re-appointment of internal auditors and external auditors, the audit fee and anyquestions of resignation or dismissal including recommending the nomination of person or persons as auditors.

(i) To verify any allocation of options in accordance with the employees’ share option scheme of the Company, at theend of the financial year.



SUMMARY OF ACTIVITIES OF THE COMMITTEE

During the financial year under review, the activities undertaken by the Committee includes:-

(a) Reviewed the unaudited quarterly financial statements and the audited accounts of the Company and the Group includingthe announcements pertaining thereto, before recommending to the Board of Directors for their approval and release toBursa Securities;

(b) Reviewed with external auditors on their audit planning memorandum of the Group for the financial year ended 31 December 2011;

(c) Reviewed with external auditors on the results and issues arising from their audit of the previous financial year endstatements and their resolutions of such issues highlighted in their report to the Committee;

(d) Reviewed related party transactions to ensure that they are fair and reasonable, and not detriment to minorityshareholders;

(e) Reviewed with the internal auditors on the internal audit findings and issues arising from their internal audit review andthe management recommendations;

(f) Met the external auditors on two private sessions without the presence of executive directors and management; and(g) Verified the allocation of Employees’ Share Option Scheme (“ESOS”) options is in compliance with the established and

approved ESOS By-Laws.

STATEMENT ON EMPLOYEES’ SHARE OPTION SCHEME (“ESOS”) BY THE COMMITTEE

During the financial year ended 31 December 2011, the Company had granted 10.5 million new share options pursuant to theESOS to eligible employees and directors of the Company and its subsidiaries at an exercise price of RM0.60 per share.

The Committee has verified and is satisfied that the options granted were in accordance with the ESOS By-Laws, the criteriaand basis of allocation set by the Option Committee.

During the financial year, the Company has granted share options to the Non-Executive Directors. Details of their share optionsare disclosed in the Directors’ Report.

INTERNAL AUDIT FUNCTION

The Group’s internal audit function is outsourced to an independent professional firm, KPMG Business Advisory Sdn Bhd(“KPMG”) which reports to the Committee in monitoring risks and reviewing the soundness of the internal control framework.The internal audit function cost for the year is RM22,000.

The scope of internal audit covers the audits on risk management, internal control, governance and compliance activities of the Group. This scope is in accordance to the International Professional Practices Framework of The Institute of InternalAuditors.

The approach adopted by the Group is of a risk based approach to assess and review the implementation and monitoring of control of its subsidiary companies.

The audit encompasses the following activities:• Review and assess the risk management and governance structure of the Group.• Review and appraise the soundness, adequacy and application of accounting, financial and other key internal controls

are effective.• Ascertain the extent to which the Group’s assets are safeguarded.• Ascertain the level of compliance to the Group’ policy and procedures.• Recommend improvements to the existing system of risk management, internal control and governance.

audit




statement

on internal control

1. Introduction

The Malaysian Code on Corporate Governance requires listed companies to maintain a sound system of internal controlsto safeguard shareholders’ investments and the Group’s assets. The Listing Requirements of Bursa Malaysia SecuritiesBerhad (“Bursa Securities”) require directors of listed companies to include a statement in annual reports on the state oftheir internal controls on a Group basis. The Bursa Securities’ statement on internal control: Guidance for Directors ofPublic Listed Companies (“Guidance”) provides guidance on disclosure of the Group’s risk management activities andinternal control systems.

The Board of Directors of Green Packet Berhad is pleased to present the Statement on Internal Control, which has beenprepared largely in accordance with the Guidance. The Board believes the practice of good corporate governance is animportant continuous process and not just a matter to be covered as compliance in its Annual Report. Hence, the Boardendeavors to maintain an adequate system of internal control that is designed to manage, rather than eliminate risk, andto improve the governance process of the Group.

2. Board Responsibility

The Board acknowledges its overall responsibility for the internal control system to cover the financial, compliance andoperational controls of the Group. The Board also recognizes its responsibility for reviewing the adequacy and integrityof the system of internal controls to safeguard shareholders’ investment and the Group’s assets. However, it should benoted that such a system is designed to manage rather than eliminate the risk of failure to achieve business objectivesand can only provide reasonable and not absolute assurance against material misstatement or loss.

3. Risk Management Framework

The Group maintains a risk management framework to continually update and identify the various risk factors that couldhave a potentially significant impact on the Group’s mid to long term business objectives.

The Board also, throughout the current financial year, has identified, evaluated and managed the significant risks facedby the Group through monitoring of the Group’s operational efficiency and profitability.

4. Internal Audit Function

KPMG Business Advisory Sdn Bhd (“KPMG”) an independent professional firm, supports the Audit Committee, and byextension, the Board, by providing independent assurance on the effectiveness of the Group’s system of internal controls.

In particular, KPMG appraises and contributes towards improving the Group’s risk management and control systems andreports to the Audit Committee. In assessing the adequacy and effectiveness of the system of internal controls andfinancial control procedures of the Group, the Audit Committee reports to the Board on its activities, significant auditfindings and the necessary recommendations or actions needed to be taken by management to rectify those issues.

The internal audit work plan, which reflects the risk profile of the Group’s major business sectors is routinely reviewedand approved by the Audit Committee. The scope of KPMG’s function covered the audit and review of governance, riskmanagement, compliance, operational and financial control across all business units.

The costs incurred for the internal audit function in respect of the financial year ended 31 December 2011 was RM22,000.

5. Key Process

The Group’s key internal control processes based on COSO principles benchmarking are as follows:

Control Environment

• Management provides strategic leadership with proper delegation, aligned to business and operations requirementsin order to achieve the Group’s missions.

• A clear and detailed organisation structure has been established to focus on the related reporting responsibilitiesand accountabilities to ensure and clarify task ownership.



statement

on internal control (cont’d)

5. Key Process (cont’d)

Control Environment (cont’d)

• The Board had delegated authority levels with limits for various business transactions to the senior managementteam duly documented, to facilitate effective internal control over expenditure commitment.

• The Group has in place a Whistle Blower Policy, which forms part of the Code of Ethics, to provide an avenue foremployees to report any breach or suspected breach of any law or regulation, including business principles andthe Group’s policies and guidelines in a safe and confidential environment.

• A Code of Ethics & Conduct is established for all employees which defines the ethical standards and conduct ofwork required at the Company and Group levels. New employees undergo a structured orientation programmesorganised by the Human Capital Department, where they are briefed on the Group’s culture, organization structure,codes of ethics & conducts and employees’ benefits.

Risk Assessment

• Quarterly risk management meetings were conducted and attended by the senior management team at subsidiaries’levels to discuss, identify and manage key enterprise risks.

Control Activities

• The Group constantly reviews and updates its standing operating procedures to ensure consistency, clarity andaccountability in the Group’s daily operations.

• The Group has in placed a dedicated billing and customer care service to manage the billing and collectionfunctions efficiently for its subsidiaries.

Information And Communication

• Employees are briefed on their job descriptions, responsibilities and KPI expectations upon joining the Group bytheir immediate supervisors and a documented copy of the same is filed in their respective personnel files.

• Issues and matters arising from departments and functions are discussed and resolved in weekly and monthlymanagement meetings with minutes of meetings taken.

• The communication channels widely used are email, teleconferencing with emphasis placed on effective and “free-flow” or open communication within the organisation.

Monitoring

• Dashboards of individual functions are utilized to monitor and track progress of all projects and initiatives undertaken. • Management constantly monitored financial performances, business plan achievement and the progress of

corrective actions implementated.

6. Conclusion

The Management continues to take measures and maintains an ongoing commitment to strengthen the Group’s controlenvironment and processes. During the year, there were no material losses caused by breakdown in internal controls. Itshould be appreciated that the system of internal controls only provides reasonable assurance in managing businessrisks rather than eliminating them and there is no absolute assurance against material misstatement or loss.

The external auditors have reviewed this Statement on Internal Control for the inclusion in the annual report for the yearended 31 December 2011 and reported to the Board that nothing has come to their attention that causes them to believethat the statement is inconsistent with their understanding of the process adopted by the Board in reviewing the adequacyand integrity of the system of internal controls of the Group.

This statement was made in accordance with a resolution of the Board dated 23 May 2012.



statement

on directors’ responsibility

The directors are responsible for ensuring that the financial statements of the Group and the Company are drawn up inaccordance with applicable approved accounting standards in Malaysia, the provisions of the Companies Act, 1965 and theListing Requirements of Bursa Malaysia Securities Berhad so as to give a true and fair view of the state of affairs of the Groupand the Company as at 31 December 2011.

In preparing the financial statements for the year ended 31 December 2011, the Directors have:-

• Adopted suitable accounting policies and applied them consistently;• Made judgments and estimates that are reasonable and prudent;• Ensured adoption of applicable accounting standards; and • Prepared the financial statements on a going concern basis.

The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at all times thefinancial position of the Group and the Company and to enable them to ensure that the financial statements comply with theCompanies Act, 1965.

The Directors are also responsible for safeguarding the assets of the Group and the Company and, hence, for taking reasonablesteps in the prevention and detection of fraud and other irregularities.



additional

compliance information

1. Utilisation of Proceeds

The Company did not implement any fund raising exercise during the financial year.

2. Share Buy-backs

The Company did not make any share buy-back arrangement during the financial year. To-date, the Company has4,707,700 treasury shares.

3. Options, Warrants or Convertible Securities

Warrants 2009/2014

The Company had on 28 September 2009 issued 197,613,775 warrants. Each warrants entitles the warrant holder tosubscribe for one new ordinary shares of RM0.20 each in the Company at an exercise price of RM0.95 per ordinary share.

The period of the warrants is 5 years from the date of issuance and is expiring on 27 September 2014. The warrants areconstituted by a Deed Poll dated 17 August 2009. None of the Warrants were exercised during the financial year.

Employees’ Share Option Scheme (“ESOS”)

The Company had on 8 August 2006 established and implemented an ESOS and is to be in force for a period of (5) yearswith an option to extend the duration of the scheme for a further (5) years but shall not exceed the duration of (10) years.On 17 February 2011, the Board of Directors approved the extension of the existing ESOS which expired on 8 August2011 for a further (5) years to 8 August 2016.

On 5 May 2011, the Company granted 10,500,000 share options to eligible employees and directors of the Companyand Group.

None of the employees exercised their share options during the year.

The details of the options over the ordinary shares of RM0.20 each and the exercise prices of the following offers grantedunder the ESOS are as follows:-

Adjusted LapsedExercise Due to Exercised

Price after As at Staff during As atDate Exercise Rights 1.1.2011 Granted Resignations the year 31.12.2011of Offer Price Issue ‘000 ‘000 ‘000 ‘000 ‘000

8.8.2006 RM4.48 RM4.22 7,140 - 609 - 6,53128.3.2008 RM2.09 RM1.97 7,452 - 1,117 - 6,33529.1.2009 RM0.85 RM0.80 7,201 - 1,041 - 6,1601.3.2010 RM1.10 - 10,083 - 1,544 - 8,5395.5.2011 RM0.60 - - 10,500 1,461 - 9,039



additional

compliance information (cont’d)

4. American Depository Receipt (ADR) or Global Depository Receipt (GDR) Programme

During the financial year, the Company did not sponsor any ADR or GDR.

5. Imposition of Sanctions/Penalties

During the financial year, there were no sanctions and/or penalties imposed on the Company and its subsidiaries, directorsor management by any regulatory bodies.

6. Non-Audit Fee

Non-audit fee amounting RM30,422 was paid to external auditors of the Group during the year.

7. Variation in results

There was no significant variance in the Company’s audited financial results for the financial year ended 31 December 2011and the unaudited results previously announced for the financial quarter ended 31 December 2011.

8. Profit Guarantee

The Company did not give any profit guarantee during the financial year.

9. Material Contracts

There were no material contracts entered into by the Company and its subsidiary companies involving Directors andmajor shareholders’ interests, either still subsisting at the end of the financial year end or entered into since end of theprevious financial year end.

10. Recurrent Related Party Transaction of a Revenue Nature

There was no recurrent related party transaction of a revenue nature which requires shareholders’ mandate during the year.


050 Directors’ Report

057 Statement by Directors

057 Statutory Declaration

058 Independent Auditors’ Report

060 Statements of Financial Position

062 Statements of Comprehensive Income

064 Statements of Changes in Equity

068 Statements of Cash Flows

070 Notes to the Financial Statements

GP ACC:GP-Acc 28/05/12 3:48 PM Page 49


The directors hereby submit their report and the audited financial statements of the Group and of the Company for the financialyear ended 31 December 2011.

PRINCIPAL ACTIVITIES

The Company is principally engaged in the business of research, development, manufacturing, marketing and distribution ofwireless networking and telecommunication products, networking solutions and other high technology products and services.The principal activities of the subsidiaries are set out in Note 5 to the financial statements. There have been no significantchanges in the nature of these activities during the financial year.

RESULTS

The Group The CompanyRM’000 RM’000

(Loss)/Profit after taxation for the financial year (177,696) 21,183

Attributable to:-Owners of the Company (85,725) 21,183Non-controlling interest (91,971) -

(177,696) 21,183

DIVIDENDS

No dividend was paid since the end of the previous financial year and the directors do not recommend the payment of anydividend for the current financial year.

RESERVES AND PROVISIONS

All material transfers to or from reserves or provisions during the financial year are disclosed in the financial statements.

ISSUES OF SHARES AND DEBENTURES

During the financial year,

(a) there were no changes in the authorised and issued and paid-up share capital of the Company; and

(b) there were no issues of debentures by the Company.

TREASURY SHARES

There were no purchases of any ordinary shares from the open market during the financial year. As at 31 December 2011, thetotal number of shares held as treasury shares amounted to 4,707,700 ordinary shares. The treasury shares are held at acarrying amount of RM11,388,802. Relevant details on the treasury shares are disclosed in Note 19 to the financial statements.

directors’ report



OPTIONS GRANTED OVER UNISSUED SHARES

During the financial year, no options were granted by the Company to any person to take up any unissued shares in theCompany except for the options granted pursuant to the Employees’ Share Option Scheme.

WARRANTS 2009/2014

The Company had on 28 September 2009 issued 197,613,775 Warrants in conjunction with the Rights Issue. The Warrants areconstituted by a Deed Poll dated 17 August 2009 (“Deed Poll”). The salient features of the Warrants 2009/2014 are as follows:-

(a) The issue date of the Warrants was 28 September 2009 and the expiry date is 27 September 2014. Any Warrant notexercised at the expiry date will lapse and cease to be valid for any purpose;

(b) Each Warrant entitles the registered holder to subscribe for one (1) new ordinary share of RM0.20 each in the Companyat an exercise price of RM0.95 per ordinary share;

(c) The exercise price and the number of unexercised Warrants are subject to adjustments in the event of alteration to theshare capital of the Company, capital distribution or issue of shares or any other events in accordance with the provisionsof the Deed Poll;

(d) The Warrant holders are not entitled to vote in any general meeting of the Company or to participate in any distributionand/or offer of further securities in the Company unless and until the Warrant holders exercise their Warrants for newshares; and

(e) The new ordinary shares to be issued upon exercise of the Warrants, shall, upon allotment and issue, rank pari passuwith the then existing ordinary shares except that they will not be entitled to dividends, rights, allotments and/or otherdistributions declared by the Company prior to the relevant allotment date of the new ordinary shares allotted pursuantto the exercise of the Warrants.

The movements of the Warrants during the financial year are as follows:-

Entitlement of Ordinary Shares of RM0.20 Each At At

1.1.2011 Issued Exercised 31.12.2011

Number of unexercised warrants (Unit) 197,613,775 - - 197,613,775

EMPLOYEES’ SHARE OPTION SCHEME (“ESOS”)

The ESOS is governed by the By-Laws approved by the shareholders on 30 March 2006. The ESOS was implemented on 8 August 2006 and is to be in force for a period of 5 years from the date of implementation with an option to extend the durationof the Scheme for a further (5) years but shall not in aggregate exceed the duration of (10) years.

On 17 February 2011, the Board of Directors approved the extension of the existing ESOS which expired on 8 August 2011 fora further five (5) years to 8 August 2016.

On 5 May 2011, the Company granted 10,500,000 share options to eligible employees and directors of the Company andGroup with an exercise price of RM0.60 per new share.

directors’ report (cont’d)



EMPLOYEES’ SHARE OPTION SCHEME (“ESOS”) (CONT’D)

During the year, the outstanding options are as follows:

Date AdjustedExercise Price

Issued on 8 August 2006 RM4.22Issued on 28 March 2008 RM1.97Issued on 29 January 2009 RM0.80Issued on 1 March 2010 RM1.10Issued on 5 May 2011 RM0.60

The movement in the options to subscribe for the new ordinary shares of RM0.20 each at the respective adjusted exerciseprice per share is as follows:-

Number of Options Over Ordinary Shares of RM0.20 Each At The Adjusted Exercise Price of

RM4.22 RM1.97 RM0.80 RM1.10 RM0.60Each Each Each Each Each‘000 ‘000 ‘000 ‘000 ‘000

As at 1 January 2011 7,140 7,452 7,201 10,083 -Granted during the financial year - - - - 10,500Cancellation due to staff resignations (609) (1,117) (1,041) (1,544) (1,461)Exercised during the financial year - - - - -

As at 31 December 2011 6,531 6,335 6,160 8,539 9,039

The Company has made an application to the Companies Commission of Malaysia (“CCM”) and the CCM had on 30 March 2012 granted its approval for the Company to disclose the names of eligible employees holding at least 752,457 share options pursuant to the ESOS of the Company during the financial year.

Employees who are holding 752,457 and above share options pursuant to the ESOS are as follows:-

Number of Options Over Ordinary Shares of RM0.20 EachAt At

1.1.2011 Granted Exercised 31.12.2011

Puan Chan Cheong 3,066,550 900,000 3,966,550Tan Kay Yen 1,821,796 450,000 2,271,796Lai Chin Tak 1,538,885 350,000 1,888,885Kelvin Lee Tsuan Chin 991,330 264,800 1,256,130Liew Kok Seong 795,977 308,000 1,103,977Nik Mat Ismail 789,875 64,800 854,675Wang Chang-Hsien 779,306 164,800 944,106Ti Lian Seng 677,090 274,800 951,890Dan Dan Huang 649,953 114,800 764,753Kan Tze Chun 637,658 114,800 752,458

The salient terms and conditions of the ESOS are as follows:-

(i) the ESOS shall be in force for a period of 5 years commencing from the effective date of the implementation of the ESOSand is to expire on 8 August 2011. Upon the expiry of the ESOS, the Board of Directors shall have the discretion, withoutapprovals of the Company’s shareholders, to extend the duration of the ESOS provided that such extension shall not inaggregate exceed the duration of 10 years. On 17 February 2011, the Board of Directors approved the extension of the ESOS for a further 5 years to 8 August 2016.


NIL



EMPLOYEES’ SHARE OPTION SCHEME (“ESOS”) (CONT’D)

The salient terms and conditions of the ESOS are as follows:- (cont’d)

(ii) any employee of the Group or director of the Company who is at least 18 years old, and has been confirmed in servicefor regular full time employment of any company within the Group shall be eligible to participate in the Scheme;

(iii) the total number of new ordinary shares of the Company, which may be made available under the ESOS, shall not exceed15% of the total issued and paid-up share capital of the Company at any time during the existence of the ESOS;

(iv) not more than 50% of the new ordinary shares of the Company available under the ESOS should be allocated, inaggregate, to the directors and senior management of the Group;

(v) not more than 10% of the new ordinary shares of the Company available under the ESOS should be allocated to anyindividual eligible employee who holds 20% or more of the issued and paid-up share capital of the Company;

(vi) the price at which the option holder is entitled to subscribe for each new ordinary share of the Company may be at adiscount of not more than 10% from the 5 day weighted average market price of ordinary shares as at the offer dateprovided that the subscription price shall in no event be less than the par value of the ordinary shares;

(vii) The options shall be vested annually on each anniversary date commencing 12 months from the date of offer. Optionsthat are vested and therefore exercisable may be carried forward to subsequent years within the duration of the ESOS.Any vested options that remain unexercised at the expiry of the duration of the ESOS shall be automatically terminatedwithout any claims against the Company; and

(viii) the shares to be allotted upon any exercise of an option will rank pari passu in all respects with the existing issued andpaid-up share capital of the Company.

BAD AND DOUBTFUL DEBTS

Before the financial statements of the Group and of the Company were made out, the directors took reasonable steps toascertain that action had been taken in relation to the writing off of bad debts and the making of allowance for impairmentlosses on receivables, and satisfied themselves that all known bad debts had been written off and that adequate allowancehad been made for impairment losses on receivables.

At the date of this report, the directors are not aware of any circumstances that would require the further writing off of baddebts, or the additional allowance for impairment losses on receivables in the financial statements of the Group and of theCompany.

CURRENT ASSETS

Before the financial statements of the Group and of the Company were made out, the directors took reasonable steps toascertain that any current assets other than debts, which were unlikely to be realised in the ordinary course of business,including their value as shown in the accounting records of the Group and of the Company, have been written down to anamount which they might be expected so to realise.

At the date of this report, the directors are not aware of any circumstances which would render the values attributed to thecurrent assets in the financial statements misleading.




VALUATION METHODS

At the date of this report, the directors are not aware of any circumstances which have arisen which render adherence to theexisting methods of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate. The financialstatements of the Company are prepared on the basis of accounting principles applicable to a going concern as explained inNote 3(b) to the financial statements.

CONTINGENT AND OTHER LIABILITIES

The contingent liabilities are disclosed in Note 41 to the financial statements. At the date of this report, there does not exist:-

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

(b) any contingent liability of the Group and of the Company which has arisen since the end of the financial year.

No contingent or other liability of the Group and of the Company has become enforceable or is likely to become enforceablewithin the period of twelve months after the end of the financial year which, in the opinion of the directors, will or maysubstantially affect the ability of the Group and of the Company to meet their obligations when they fall due.

CHANGE OF CIRCUMSTANCES

At the date of this report, the directors are not aware of any circumstances not otherwise dealt with in this report or the financialstatements of the Group and of the Company which would render any amount stated in the financial statements misleading.

ITEMS OF AN UNUSUAL NATURE

The results of the operations of the Group and of the Company during the financial year were not, in the opinion of the directors,substantially affected by any item, transaction or event of a material and unusual nature.

There has not arisen in the interval between the end of the financial year and the date of this report any item, transaction orevent of a material and unusual nature likely, in the opinion of the directors, to affect substantially the results of the operationsof the Group and of the Company for the financial year.

DIRECTORS

The directors who served since the date of the last report are as follows:-

TAN SRI DATUK DR. HAJI OMAR BIN ABDUL RAHMAN PUAN CHAN CHEONGNIK MAT BIN ISMAILTAN SRI DATO’ KOK ONNBOEY TAK KONG RAMI BAZZI ONG JU YAN A. SHUKOR BIN S.A. KARIM YEE CHEE WAI (AS ALTERNATE DIRECTOR TO ONG JU YAN)




DIRECTORS’ INTERESTS

According to the register of directors’ shareholdings, the interests of directors holding office at the end of the financial year inshares, warrants and options in the Company and its related corporations during the financial year are as follows:-

Number of Ordinary Shares of RM0.20 EachAt At

1.1.2011 Bought Sold 31.12.2011

THE COMPANY

DIRECT INTERESTSPuan Chan Cheong 3,425,295 - - 3,425,295Nik Mat Bin Ismail 1,120,362 - (190,000) 930,362Boey Tak Kong 676,000 - - 676,000

Number of Ordinary Shares of RM0.20 EachAt At

1.1.2011 Bought Sold 31.12.2011

THE COMPANY

INDIRECT INTERESTSPuan Chan Cheong # 223,878,339 - - 223,878,339Tan Sri Dato’ Kok Onn # 223,878,339 - - 223,878,339

Number of Warrants 2009/2014At Brought/ Sold/ At

1.1.2011 Allotted Exercised 31.12.2011

THE COMPANY

DIRECT INTERESTSPuan Chan Cheong 1,241,765 - - 1,241,765Nik Mat Bin Ismail 146,787 - - 146,787

# - Deemed interested by virtue of their direct substantial shareholdings in Green Packet Holdings Ltd.

Number of Options Over Ordinary Shares of RM0.20 EachAt At

1.1.2011 Granted Exercised 31.12.2011

THE COMPANY

PUAN CHAN CHEONG 3,066,550 900,000 - 3,966,550NIK MAT BIN ISMAIL 789,875 64,800 - 854,675TAN SRI DATO’ KOK ONN 157,875 50,000 - 207,875TAN SRI DATUK DR. HAJI OMAR BIN ABDUL RAHMAN 132,041 50,000 - 182,041

BOEY TAK KONG 106,207 50,000 - 156,207A. SHUKOR BIN S.A. KARIM - 50,000 - 50,000ONG JU YAN - 50,000 - 50,000




DIRECTORS’ INTERESTS (CONT’D)

By virtue of their interests in shares in the Company, Puan Chan Cheong and Tan Sri Dato’ Kok Onn are deemed to have interestsin the shares in the subsidiaries to the extent of the Company’s interest, in accordance with Section 6A of the Companies Act,1965.

The other directors holding office at the end of the financial year had no interest in shares in the Company or its relatedcorporations during the financial year.

DIRECTORS’ BENEFITS

Since the end of the previous financial year, no director has received or become entitled to receive any benefit (other than abenefit included in the aggregate amount of emoluments received or due and receivable by directors as shown in the financialstatements, or the fixed salary of a full-time employee of the Company) by reason of a contract made by the Company or arelated corporation with the director or with a firm of which the director is a member, or with a company in which the directorhas a substantial financial interest except for any benefits which may be deemed to arise from transactions entered into in theordinary course of business with companies in which certain directors have substantial financial interests as disclosed in Note37 to the financial statements.

Neither during nor at the end of the financial year was the Group or the Company a party to any arrangements whose objectis to enable the directors to acquire benefits by means of the acquisition of shares in or debentures of the Company or anyother body corporate other than the options granted to certain directors pursuant to the ESOS of the Company.

SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR

The significant events during the financial year are disclosed in Note 43 to the financial statements.

SIGNIFICANT EVENTS OCCURRING AFTER THE REPORTING PERIOD

The significant events occurring after the reporting period are disclosed in Note 44 to the financial statements.

AUDITORS

The auditors, Messrs. Crowe Horwath, have expressed their willingness to continue in office.

SIGNED IN ACCORDANCE WITH A RESOLUTION OF THE DIRECTORSDATED 25 APRIL 2012

Puan Chan Cheong

Nik Mat Bin Ismail




We, Puan Chan Cheong and Nik Mat Bin Ismail, being two of the directors of Green Packet Berhad, state that, in the opinionof the directors, the financial statements set out on pages 60 to 137 are drawn up in accordance with Financial ReportingStandards and the Companies Act 1965 in Malaysia so as to give a true and fair view of the state of affairs of the Group and ofthe Company at 31 December 2011 and of their results and cash flows for the financial year ended on that date.

The supplementary information set out in Note 47, which is not part of the financial statements, is prepared in all materialrespects, in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses inthe Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the MalaysianInstitute of Accountants and the directive of Bursa Malaysia Securities Berhad.

SIGNED IN ACCORDANCE WITH A RESOLUTION OF THE DIRECTORSDATED 25 APRIL 2012

Puan Chan Cheong Nik Mat Bin Ismail

I, Liew Kok Seong, I/C No. 680730-10-6985, being the officer primarily responsible for the financial management of GreenPacket Berhad, do solemnly and sincerely declare that the financial statements set out on pages 60 to 137 are, to the best ofmy knowledge and belief, correct, and I make this solemn declaration conscientiously believing the same to be true and byvirtue of the provisions of the Statutory Declarations Act 1960.

Subscribed and solemnly declared byLiew Kok Seong, I/C No. 680730-10-6985,at Kuala Lumpur in the Federal Territory on this 25 April 2012

Liew Kok Seong

Before me

Pesuruhjaya SumpahYap Lee Chin (No. W – 591)

statementby directors

statutorydeclaration



Report on the Financial Statements

We have audited the financial statements of Green Packet Berhad, which comprise the statements of financial position as at31 December 2011 of the Group and of the Company, and the statements of comprehensive income, statements of changesin equity and statements of cash flows of the Group and of the Company for the financial year then ended, and a summary ofsignificant accounting policies and other explanatory information, as set out on pages 60 to 137.

Directors’ Responsibility for the Financial Statements

The directors of the Company are responsible for the preparation of financial statements that give a true and fair view inaccordance with Financial Reporting Standards and the Companies Act 1965 in Malaysia, and for such internal control as thedirectors determine is necessary to enable the preparation of financial statements that are free from material misstatement,whether due to fraud or error.

Auditors’ Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit inaccordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical requirementsand plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from materialmisstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financialstatements. The procedures selected depend on our judgement, including the assessment of risks of material misstatement ofthe financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control relevantto the Company’s preparation of financial statements that give a true and fair view in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’sinternal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness ofaccounting estimates made by the directors, as well as evaluating the overall presentation of the financial statements.

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

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards andthe Companies Act 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Companyas of 31 December 2011 and of their financial performance and cash flows for the financial year then ended.

Emphasis of Matter

Without qualifying our opinion, we draw attention to Note 3(b) to the financial statements which discloses the premise uponwhich the Group has prepared its financial statements by applying the going concern assumption, notwithstanding that theGroup incurred a net loss of RM85.725 million during the financial year ended 31 December 2011, and as of that date, theGroup's current liabilities exceeded its current assets by RM219.973 million, thereby indicating the existence of a materialuncertainty on the Group’s ability to continue as a going concern.

independent auditors’ report to the members of Green Packet Berhad(incorporated in Malaysia) Company No: 534942-H



Report on Other Legal and 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 andits subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of theAct.

(b) We have considered the financial statements and the auditors' reports of the subsidiaries of which we have not acted asauditors, which are indicated in Note 5 to the financial statements.

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

(d) The audit reports on the financial statements of the subsidiaries did not contain any qualification or any adverse commentmade under Section 174(3) of the Act other than the emphasis of matter on the going concern of certain subsidiaries asindicated in Note 5 to the financial statements.

The supplementary information set out in Note 47 to the financial statements is disclosed to meet the requirement of BursaMalaysia Securities Berhad and is not part of the financial statements. The directors are responsible for the preparation of thesupplementary information in accordance with Guidance on Special Matter No. 1, Determination of Realised and UnrealisedProfits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issuedby the Malaysian Institute of Accountants ("MIA Guidance") and the directive of Bursa Malaysia Securities Berhad. In ouropinion, the supplementary information is prepared, in all material respects, in accordance with the MIA Guidance and thedirective of Bursa Malaysia Securities Berhad.

Other Matters

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.

Crowe Horwath Lee Kok WaiFirm No: AF 1018 Approval No: 2760/06/12 (J)Chartered Accountants Chartered Accountant

25 April 2012

Kuala Lumpur

independent auditors’ report to the members of Green Packet Berhad (cont’d)(incorporated in Malaysia) Company No: 534942-H


The Group The CompanyRestated

2011 2010 2009 2011 2010Note RM’000 RM’000 RM’000 RM’000 RM’000

ASSETS

NON-CURRENT ASSETSInvestments in subsidiaries 5 - - - 66,606 68,019Investments in associates 6 - - 18,785 - -Property, plant and equipment 7 622,557 504,990 474,667 3,556 5,131Other investments 8 135 135 9,263 635,614 425,150Goodwill 9 13,004 18,811 23,141 - -Development costs 10 35,201 44,907 60,790 14,888 17,869Intangible assets 11 65,008 69,033 39,951 4,940 7,220Amount owing by subsidiaries 15 - - - 50,000 141,000

735,905 637,876 626,597 775,604 664,389

CURRENT ASSETSInventories 12 31,532 21,779 35,732 7,747 12,207Trade receivables 13 71,295 60,513 42,840 30,511 12,171Other receivables, deposits and prepayments 14 61,282 60,959 117,431 6,222 7,086Amount owing by subsidiaries 15 - - - 104,919 70,667Tax refundable - 162 561 - -Deposits with licensed banks 16 1,191 72,368 2,792 1,191 1,159Cash and bank balances 17 84,085 98,452 144,363 71,533 82,967

249,385 314,233 343,719 222,123 186,257

TOTAL ASSETS 985,290 952,109 970,316 997,727 850,646

EQUITY AND LIABILITIES

EQUITYShare capital 18 131,551 131,551 131,461 131,551 131,551 Treasury shares 19 (11,389) (11,389) (11,389) (11,389) (11,389)Reserves 20 52,714 134,809 275,447 618,261 485,260

TOTAL EQUITY ATTRIBUTABLE TO OWNERS OF THE COMPANY 172,876 254,971 395,519 738,423 605,422

NON-CONTROLLING INTERESTS (4,269) 63,532 5,307 - -

TOTAL EQUITY 168,607 318,503 400,826 738,423 605,422

NON-CURRENT LIABILITIESGCEB 21 - 50,000 50,000 - 50,000 Hire purchase payables 22 452 2,217 8,952 79 360 Borrowings 23 200,115 246,043 162,998 7,152 9,982 Other payables and accruals 26 89,082 46,112 91,089 - -Deferred taxation 24 57,676 49,635 2,499 12 24

347,325 394,007 315,538 7,243 60,366


statements of financial positionat 31 December 2011

The annexed notes form an integral part of these financial statements.




2011 2010 2009 2011 2010Note RM’000 RM’000 RM’000 RM’000 RM’000

CURRENT LIABILITIESTrade payables 25 98,503 39,763 67,951 49,629 18,890Other payables and accruals 26 223,075 133,240 147,470 9,766 10,025Amount owing to subsidiaries 15 - - - 113,943 140,203Amount owing to a related party 27 2,578 - - 2,578 -GCEB 21 50,000 - - 50,000 -Hire purchase payables 22 2,888 5,790 6,012 281 298Borrowings 23 92,314 60,806 32,519 25,864 15,442

469,358 239,599 253,952 252,061 184,858

TOTAL LIABILITIES 816,683 633,606 569,490 259,304 245,224

TOTAL EQUITY AND LIABILITIES 985,290 952,109 970,316 997,727 850,646

NET ASSETS PER SHARE (SEN) 28 26 40 61

statements of financial positionat 31 December 2011 (cont’d)




The Group The Company2011 2010 2011 2010

Note RM’000 RM’000 RM’000 RM’000

REVENUE 29 538,526 393,968 214,678 124,451

COST OF SALES (244,374) (216,482) (154,687) (89,661)

GROSS PROFIT 294,152 177,486 59,991 34,790

OTHER INCOME 9,750 1,348 14,814 8,598

303,902 178,834 74,805 43,388

ADMINISTRATIVE EXPENSES (31,307) (32,655) (24,793) (32,684)

SELLING AND DISTRIBUTION EXPENSES (125,017) (62,762) (3,993) (2,350)

OTHER EXPENSES (292,995) (275,361) (17,538) (56,227)

SHARE OF RESULTS IN ASSOCIATES - (17,907) - -

FINANCE COSTS (32,364) (16,020) (7,406) (7,374)

(LOSS)/PROFIT BEFORE TAXATION 30 (177,781) (225,871) 21,075 (55,247)

INCOME TAX EXPENSE 31 85 308 108 (74)

(LOSS)/PROFIT AFTER TAXATION (177,696) (225,563) 21,183 (55,321)

OTHER COMPREHENSIVE INCOME, NET OF TAX

- Foreign currency translation 331 (372) 4 (16)- Fair value adjustment - - 109,255 74,000

331 (372) 109,259 73,984

TOTAL COMPREHENSIVE (EXPENSES)/ INCOME FOR THE FINANCIAL YEAR (177,365) (225,935) 130,442 18,663

statements of comprehensive incomefor the financial year ended 31 December 2011





Note RM’000 RM’000 RM’000 RM’000

(LOSS)/PROFIT AFTER TAXATION ATTRIBUTABLE TO:-Owners of the Company (85,725) (143,397) 21,183 (55,321)Non-controlling interests (91,971) (82,166) - -

(177,696) (225,563) 21,183 (55,321)

TOTAL COMPREHENSIVE (EXPENSES)/INCOMEATTRIBUTABLE TO:-Owners of the Company (85,394) (143,769) 130,442 18,663Non-controlling interests (91,971) (82,166) - -

(177,365) (225,935) 130,442 18,663

LOSS PER SHARE (SEN)- Basic 32 (13) (22)

- Diluted 32 Not Notapplicable applicable

statements of comprehensive incomefor the financial year ended 31 December 2011 (cont’d)




Non-Distributable

Distribu-

Table

Attribu-

Employee

Retained

Table To

Transla-

Share

Profits/

Owners

Non-

Share

Treasury

Share

tion

Option

Warrant

(Accum

ulated

Of The Controlling

Total

Capital

Shares

Premium

Reserve

Reserve

Reserve

Losses)Com

pany

Interests

Equity

THE GROUP

Note

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

Balan

ce at 1.1.20

1013

1,46

1(11,38

9)34

5,53

041

911

,490

57,714

(139

,706

)39

5,51

95,30

740

0,82

6

Loss afte

r taxatio

n for the

finan

cial yea

r-

--

--

-(143

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)(143

,397

)(82,16

6)(225

,563

)

Other com

prehe

nsive inco

me,

net o

f tax

- foreign cu

rren

cy tran

slation

--

-(372

)-

--

(372

)-

(372

)

Total c

omprehe

nsive inco

me

--

-(372

)-

-(143

,397

)(143

,769

)(82,16

6)(225

,935

)

Tran

sactions with

owne

rs of

the Com

pan

y:- Issuan

ce of p

referenc

e shares by subsidiary

- As previou

sly stated

--

--

--

--

129,23

812

9,23

8- Prio

r year adjustmen

t45

--

--

--

--

19,173

19,173

- As restated

--

--

--

--

148,41

114

8,41

1

- Exp

enses incu

rred

on issuan

ce of

- ordinary shares

--

(428

)-

--

-(428

)-

(428

)- preferenc

e shares

--

--

--

--

(8,020

)(8,020

)

- Sha

re Optio

ns granted

und

erESOS

--

--

3,28

9-

-3,28

9-

3,28

9

- ESOS exercised

90-

270

--

--

360

-36

0

Balan

ce at 3

1.12

.201

013

1,55

1(11,38

9)34

5,37

247

14,779

57,714

(283

,103

)25

4,97

163

,532

318,50

3

statements of changes in equityfor the financial year ended 31 December 2011

The an

nexed notes fo

rm an integral p

art o

f the

se fina

ncial statemen

ts.



Non-Distributable

Distribu-

Table

Attribu-

Employee

Retained

Table To

Transla-

Share

Profits/

Owners

Non-

Share

Treasury

Share

tion

Option

Warrant

(Accum

ulated

Of The Controlling

Total

Capital

Shares

Premium

Reserve

Reserve

Reserve

Losses)Com

pany

Interests

Equity

THE GROUP

Note

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

Balance at 31.12.2010/1.1.2011

131,551

(11,389)

345,372

4714,779

57,714

(283,103)

254,971

63,532

318,503

Los s after taxation for the

financial year

--

--

--

(85,725)

(85,725)

(91,971)

(177,696)

Other com

prehensive income,

net of tax

- foreign

currency tra

nslation

--

-331

--

-331

-331

Total com

prehensive income

--

-331

--

(85,725)

(85,394)

(91,971)

(177,365)

Transactions with owners of

the Com

pany

- Issuance of preference

shares by subsidiary

--

--

--

--

24,170

24,170

- Share Options granted

und

erES

OS

--

--

3,299

--

3,299

-3,299

Balance at 31.12.2011

131,551

(11,389)

345,372

378

18,078

57,714

(368,828)

172,876

(4,269)

168,607

statements of changes in equityfor the financial year ended 31 December 2011 (cont’d)

The an

nexed notes fo

rm an integral p

art o

f the

se fina

ncial statemen

ts.



Non-Distributable

Distribu-

Table

Employee

Transla-

Share

Fair

Share

Treasury

Share

tion

Option

Value

Warrant

Retained

Total

Capital

Shares

Premium

Reserve

Reserve

Reserve

Reserve

Profits

Equity

THE COMPA

NY

Note

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

Balance at 1.1.2010

131,461

(11,389)

345,530

1911,490

-57,714

48,713

583,538

Loss after taxation for the financial year

--

--

--

-(55,321)

(55,321)

Other com

prehens ive income, net of tax

- fair value chang

es on available-

for-sale financial assets

--

--

-74,000

--

74,000

- foreign

currency tra

nslation

--

-(16)

--

--

(16)

Total com

prehensive income

--

-(16)

-74,000

-(55,321)

18,663

Transactions with owners ofthe Com

pany

- Expenses incurred

on issuance

of ordinary shares

--

(428)

--

--

-(428)


und

er ESO

S -

--

-3,289

--

-3,289

- ESO

S exercised

90-

270

--

--

-360


131,551

(11,389)

345,372

314,779

74,000

57,714

(6,608)

605,422


The an

nexed notes fo

rm an integral p

art o

f the

se fina

ncial statemen

ts.




Non-Distributable

Distribu-

Table

Employee

Transla-

Share

Fair

Share

Treasury

Share

tion

Option

Value

Warrant

Retained

Total

Capital

Shares

Premium

Reserve

Reserve

Reserve

Reserve

Profits

Equity

THE COMPA

NY

Note

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

RM’000

Balance at 31.12.2010/1.1.2011

131,551

(11,389)

345,372

314,779

74,000

57,714

(6,608)

605,422

Profi t after taxation for the financial year

-

-

-

-

-

-

-

21,183

21,183

Other com

prehensive income, net of tax

- fair value chang

es on available-

for-sales financial assets

-

-

-

-

-

109,255

-

- 109,255

- foreign

currency tra

nslation

-

-

-

4 -

-

-

-

4

Total com

prehensive income

-

-

-

4 -

109,255

-

21,183

130,442

Trans actions with owners of the Com

pany


und

er ESO

S -

-

-

-

2,559

-

-

-

2,559


131,551

(11,389)

345,372

7 17,338

183,255

57,714

14,575

738,423

The an

nexed notes fo

rm an integral p

art o

f the

se fina

ncial statemen

ts.




Note RM’000 RM’000 RM’000 RM’000

CASH FLOWS FROM/(FOR) OPERATING ACTIVITIES

(Loss)/Profit before taxation (177,781) (225,871) 21,075 (55,247)

Adjustments for:-Amortisation of:- development costs 5,407 5,429 3,261 2,712- intellectual property 2,280 2,280 2,280 2,280- modems 57,343 28,838 - -

Bad debts written off - 1,130 - 1,130Depreciation of property, plant and equipment 67,638 51,219 1,718 1,977Development costs written off 6,542 14,931 6,491 3,424Equipment written off 716 14 424 14Impairment loss on:- trade receivables 17,689 6,039 - 4,196- other receivables - 1,304 - 1,304- amount owing by a subsidiary - - - 3,192- other investment - 9,128 - 9,128- investments in subsidiaries - - 4,800 11,235- goodwill 5,807 4,330 - -- investments in associates - 878 - 20,108Interest expense 32,364 16,020 7,403 7,374Inventories written down 9,292 8,939 2,137 996Modems written off 1,395 - - -Share of loss in associates - 17,907 - -Share options granted under ESOS 3,299 3,289 2,559 3,289Loss on disposal of property, plant and equipment 2 21 - -Gain on disposal of a subsidiary/business (283) - - -Dividend income from an associate (733) - (733) -Unrealised loss/(gain) on foreign exchange 1,400 (14,484) (5,031) 6,115Interest income (663) (510) (6,027) (8,598)

Operating profit/(loss) before working capital changes 31,714 (69,169) 40,357 14,629(Increase)/Decrease in inventories held for resale (19,045) 5,014 2,323 11,260Increase in trade and other receivables (29,969) (38,178) (17,476) (13,651)Increase/(Decrease) in trade and other payables 179,918 (77,191) 30,480 (789)(Increase)/Decrease in amount owing by subsidiaries - - (24,705) 3,067

CASH FROM/(FOR) OPERATIONS CARRIED FORWARD 162,618 (179,524) 30,979 14,516

statements of cash flowsfor the financial year ended 31 December 2011





Note RM’000 RM’000 RM’000 RM’000

CASH FROM/(FOR) OPERATIONS CARRIED FORWARD 162,618 (179,524) 30,979 14,516Interest paid (32,364) (16,020) (7,403) (7,374)Tax (paid)/refunded (281) 1,162 96 90

NET CASH FROM/(FOR) OPERATING ACTIVITIES 129,973 (194,382) 23,672 7,232

CASH FLOWS FOR INVESTING ACTIVITIESAdditional investment in subsidiaries - - (3,387) (3,394)Addition of other investments - - (101,209) (39,687)Net cash inflows on the disposal of a subsidiary/business 33 1,331 - - -Purchase of property, plant and equipment 34 (183,428) (81,039) (898) (249)Proceeds from disposal of property, plant and equipment 365 182 - -Development costs incurred (5,103) (3,729) (6,440) (8,435)Modem costs incurred (56,993) (60,200) - -Advances to subsidiaries - - 81,453 (43,713)Interest received 663 510 6,027 8,598Dividend from an associate 733 - 733 -

NET CASH FOR INVESTING ACTIVITIES (242,432) (144,276) (23,721) (86,880)

CASH FLOWS FROM/(FOR) FINANCING ACTIVITIES

Repayment to a related company - - - (14,287)Repayment to a subsidiary - - (26,260) (5,271)Issuance of Preference Share to non-controlling interestsby subsidiary 55,195 322,910 - -

Proceeds from issuance of ordinary shares - 360 - 360Proceeds from private placement - 68,504 - 68,504Expenses incurred on issuance of ordinary/preference shares - (8,448) - (428)

Net (repayment)/drawdown of borrowings (31,553) (6,091) 7,592 607Advances from a related party 2,578 - 2,578 -Repayment of hire purchase obligations (4,667) (8,425) (298) (323)

NET CASH FROM/(FOR) FINANCING ACTIVITIES 21,553 368,810 (16,388) 49,162

NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENT (90,906) 30,152 (16,437) (30,486)

Foreign exchange translation differences 5,362 (6,487) 5,035 (6,131)

CASH AND CASH EQUIVALENTS AT BEGINNING OF THE FINANCIAL YEAR 170,820 147,155 84,126 120,743

CASH AND CASH EQUIVALENTS AT THE ENDOF THE FINANCIAL YEAR 35 85,276 170,820 72,724 84,126

statements of cash flowsfor the financial year ended 31 December 2011 (cont’d)




1. GENERAL INFORMATION

The Company is a public company limited by shares and is incorporated under the Companies Act 1965 in Malaysia.The domicile of the Company is Malaysia. The registered office and principal place of business are as follows:-

Registered office : 10th Floor, Menara Hap Seng,No. 1 & 3, Jalan P. Ramlee,50250 Kuala Lumpur.

Principal place of business : Packet Hub,159 Jalan Templer,46050 Petaling Jaya,Selangor Darul Ehsan.

The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the directors dated 25 April 2012.

2. PRINCIPAL ACTIVITIES

The Company is principally engaged in the business of research, development, manufacturing, marketing and distributionof wireless networking and telecommunication products, networking solutions and other high technology products andservices. The principal activities of the subsidiaries are set out in Note 5 to the financial statements. There have been nosignificant changes in the nature of these activities during the financial year.

3. BASIS OF ACCOUNTING

(a) Basis of Preparation

The financial statements of the Group are prepared under the historical cost convention and modified to includeother bases of valuation as disclosed in other sections under significant accounting policies, and in compliancewith Financial Reporting Standards (“FRS”) and the Companies Act 1965 in Malaysia.

(I) During the current financial year, the Group has adopted the following new accounting standards andinterpretations (including the consequential amendments):-

FRSs and IC Interpretations (including the Consequential Amendments)

FRS 1 (Revised) First-time Adoption of Financial Reporting Standards

Amendments to FRS 1 (Revised): Limited Exemption from Comparative FRS 7 Disclosures for First-timeAdopters

Amendments to FRS 1 (Revised): Additional Exemptions for First-time Adopters

Amendments to FRS 2: Scope of FRS 2 and FRS 3 (Revised)

Amendments to FRS 2: Group Cash-settled Share-based Payment Transactions

Amendments to FRS 5: Plan to Sell the Controlling Interest in a Subsidiary

Amendments to FRS 7: Improving Disclosures about Financial Instruments

notes to the financial statementsfor the financial year ended 31 December 2011



3. BASIS OF ACCOUNTING (CONT’D)

(a) Basis of Preparation (cont’d)

(I) FRSs and IC Interpretations (including the Consequential Amendments) (cont’d)

Amendments to FRS 138: Consequential Amendments Arising from FRS 3 (Revised)

IC Interpretation 4 Determining Whether An Arrangement Contains a Lease

IC Interpretation 12 Service Concession Arrangements

IC Interpretation 16 Hedges of a Net Investment in a Foreign Operation

IC Interpretation 17 Distributions of Non-cash Assets to Owners

IC Interpretation 18 Transfers of Assets from Customers

Amendments to IC Interpretation 9: Scope of IC Interpretation 9 and FRS 3 (Revised) to FRSs (2010)

Annual Improvement to FRSs (2010)

The adoption of the above accounting standards and interpretations (including the consequentialamendments) did not have any material impact on the Group’s financial statements, other than the following:-

(i) Amendments to FRS 7 expand the disclosure requirements in respect of fair value measurements andliquidity risk. In particular, the amendments require additional disclosure of fair value measurements bylevel of a fair value measurement hierarchy, as shown in Note 42(e) to the financial statements.Comparatives are not presented by virtue of the exemption given in the amendments.

(ii) Annual Improvements to FRSs (2010) contain amendments to 11 accounting standards that result in accounting changes for presentation, recognition or measurement purposes.

The amendments to FRS 101 (Revised) clarify that an entity may choose to present the analysis of theitems of other comprehensive income either in the statement of changes in equity or in the notes to thefinancial statements. The Group has chosen to present the items of other comprehensive income in thestatement of changes in equity.

(II) The Group has not applied in advance the following accounting standards and interpretations (including theconsequential amendments) that have been issued by the Malaysian Accounting Standards Board (MASB)but are not yet effective for the current financial year:-

FRSs and IC Interpretations (including the Consequential Amendments) Effective Date

FRS 9 Financial Instruments 1 January 2015

FRS 10 Consolidated Financial Statements 1 January 2013

FRS 11 Joint Arrangements 1 January 2013

FRS 12 Disclosure of Interests in Other Entities 1 January 2013

FRS 13 Fair Value Measurement 1 January 2013

notes to the financial statementsfor the financial year ended 31 December 2011 (cont’d)





(II) FRSs and IC Interpretations (including the Consequential Amendments) (cont’d) Effective Date

FRS 119 (Revised) Employee Benefits 1 January 2013

FRS 124 (Revised) Related Party Disclosures 1 January 2012

FRS 127 (2011) Separate Financial Statements 1 January 2013

FRS 128 (2011) Investments in Associates and Joint Ventures 1 January 2013

Amendments to FRS 1 (Revised): Severe Hyperinflation and Removal of Fixed Dates for First-time Adopters 1 January 2012

Amendments to FRS 7: Disclosures – Transfers of Financial Assets 1 January 2012

Amendments to FRS 7: Disclosures – Offsetting Financial Assets and Financial Liabilities 1 January 2013

Amendments to FRS 9: Mandatory Effective Date of FRS 9 and Transition Disclosures 1 January 2015

Amendments to FRS 101 (Revised): Presentation of Items of Other Comprehensive Income 1 July 2012

Amendments to FRS 112: Recovery of Underlying Assets 1 January 2012

Amendments to FRS 132: Offsetting Financial Assets and Financial Liabilities 1 January 2014

IC Interpretation 15 Agreements for the Construction of Real Estate Withdrawn on 19 November 2011

IC Interpretation 19 Extinguishing Financial Liabilities with Equity Instruments 1 July 2011

IC Interpretation 20 Stripping Costs in the Production Phase of aSurface Mine 1 January 2013

Amendments to IC Interpretation 14: Prepayments of a Minimum FundingRequirement 1 July 2011

The Group’s next set of financial statements for the annual period beginning on 1 January 2012 will beprepared in accordance with the Malaysian Financial Reporting Standards (“MFRSs”) issued by the MASBthat will also comply with International Financial Reporting Standards (“IFRSs”). As a result, the Group will notbe adopting the above accounting standards and interpretations (including the consequential amendments)that are effective for annual periods beginning on or after 1 January 2012.






(III) Following the issuance of MFRSs (equivalent to IFRSs) by the MASB on 19 November 2011, the Group will beadopting the new accounting standards in the next financial year. The Group is currently in the process ofassessing the impact of the adoption of these new accounting standards and the directors do not expect anysignificant impact on the financial statements arising from the adoption.

(b) Going Concern

The Group incurred a net loss of RM85.725 million during the financial year ended 31 December 2011, and as ofthat date, the Group's current liabilities exceeded its current assets by RM219.973 million, thereby indicating theexistence of a material uncertainty on the Group’s ability to continue as a going concern. The financial statementsof the Group are prepared on the basis of accounting principles applicable to a going concern due to the following:-

(i) The Group has successfully secured a convertible loan of RM50 million from Malaysia Debt Ventures Berhadsubsequent to the financial year end; and

(ii) The Group is currently planning to raise additional borrowings for working capital purposes.

Based on the funds expected to be raised as mentioned above, and the anticipated improvement in the Group’sresults, the directors are of the opinion that the basis of preparation of the financial statements on a going concernbasis is appropriate, and accordingly, the financial statements do not include any adjustment should the goingconcern assumption prove to be inappropriate.

4. SIGNIFICANT ACCOUNTING POLICIES

(a) Critical Accounting Estimates And Judgements

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

(i) Depreciation of Property, Plant and Equipment

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

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

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




4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D)

(a) Critical Accounting Estimates And Judgements (cont’d)

(ii) Income Taxes

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

(iii) Impairment of Non-financial Assets

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

(iv) Amortisation of Development Costs

Changes in the expected level of usage and technological development could impact the economic usefullives and therefore, future amortisation charges could be revised.

(v) Write-down of Inventories

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

(vi) Impairment of Trade and Other Receivables

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

(vii) Impairment of Available-for-sale Financial Assets

The Group reviews its available-for-sale financial assets at the end of each reporting period to assess whetherthey are impaired. The Group also records impairment loss on available-for-sale equity investments whenthere has been a significant or prolonged decline in the fair value below their cost. The determination of whatis “significant’ or “prolonged” requires judgement. In making this judgement, the Group evaluates, amongother factors, historical share price movements and the duration and extent to which the fair value of aninvestment is less than its cost.





(a) Critical Accounting Estimates And Judgements (cont’d)

(viii) Classification of Leasehold Land

The classification of leasehold land as a finance lease or an operating lease requires the use of judgement indetermining the extent to which risks and rewards incidental to its ownership lie. Despite the fact that therewill be no transfer of ownership by the end of the lease term and that the lease term does not constitute themajor part of the indefinite economic life of the land, management considered that the present value of theminimum lease payments approximated to the fair value of the land at the inception of the lease. Accordingly,management judged that the Group has acquired substantially all the risks and rewards incidental to theownership of the land through a finance lease.

(ix) Impairment of Goodwill

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

(x) Fair Value Estimates for Certain Financial Assets and Liabilities

The Group carries certain financial assets and liabilities at fair value, which requires extensive use ofaccounting estimates and judgement. While significant components of fair value measurement weredetermined using verifiable objective evidence, the amount of changes in fair value would differ if the Groupuses different valuation methodologies. Any changes in fair value of these assets and liabilities would affectprofit and/or equity.

(xi) Share-based Payments

The Group measures the cost of equity settled transactions with employees by reference to the fair value ofthe equity investments at the date at which they are granted. The estimating of the fair value requiresdetermining the most appropriate valuation model for a grant of equity instruments, which is dependent onthe terms and conditions of the grant. This also requires determining the most appropriate inputs to thevaluation model including the expected life of the option volatility and dividend yield and making assumptionsabout them.

(b) Basis of Consolidation

The consolidated financial statements include the financial statements of the Company and its subsidiaries madeup to 31 December 2011.

A subsidiary is defined as a company in which the parent company has the power, directly or indirectly, to exercisecontrol over its financial and operating policies so as to obtain benefits from its activities.

Subsidiaries are consolidated from the date on which control is transferred to the Group up to the effective date onwhich control ceases, as appropriate.





(b) Basis of Consolidation (cont’d)

Intragroup transactions, balances, income and expenses are eliminated on consolidation. Where necessary,adjustments are made to the financial statements of subsidiaries to ensure consistency of accounting policies withthose of the Group.

Non-controlling interests are presented within equity in the consolidated statement of financial position, separatelyfrom the Company’s shareholders’ equity, and are separately disclosed in the consolidated statement ofcomprehensive income. Transactions with non-controlling interests are accounted for as transactions with ownersand are recognised directly in equity. Profit or loss and each component of other comprehensive income areattributed to the owners of the parent and to the non-controlling interests. Total comprehensive income is attributedto non-controlling interests even if this results in the non-controlling interests having a deficit balance.

At the end of each reporting period, the carrying amount of non-controlling interests is the amount of those interestsat initial recognition plus the non-controlling interests’ share of subsequent changes in equity.

All changes in the parent’s ownership interest in a subsidiary that do not result in a loss of control are accountedfor as equity transactions. Any difference between the amount by which the non-controlling interest is adjusted andthe fair value of consideration paid or received is recognised directly in equity and attributed to owners of the parent.

Upon loss of control of a subsidiary, the profit or loss on disposal is calculated as the difference between:-

(i) the aggregate of the fair value of the consideration received and the fair value of any retained interest in theformer subsidiary; and

(ii) the previous carrying amount of the assets (including goodwill), and liabilities of the former subsidiary andany non-controlling interests.

Amounts previously recognised in other comprehensive income in relation to the former subsidiary are accountedfor (i.e. reclassified to profit or loss or transferred directly to retained profits) in the same manner as would berequired if the relevant assets or liabilities were disposed of. The fair value of any investments retained in the formersubsidiary at the date when control is lost is regarded as the fair value on initial recognition for subsequentaccounting under FRS 127.

Business combinations from 1 January 2010 onwards

Acquisitions of businesses are accounted for using the acquisition method. Under the acquisition method, theconsideration transferred for acquisition of a subsidiary is the fair value of the assets transferred, liabilities incurredand the equity interests issued by the Group at the acquisition date. The consideration transferred includes the fairvalue of any asset or liability resulting from a contingent consideration arrangement. Acquisition-related costs, otherthan the costs to issue debt or equity securities, are recognised in profit or loss when incurred.

In a business combination achieved in stages, previously held equity interests in the acquiree are remeasured tofair value at the acquisition date and any corresponding gain or loss is recognised in profit or loss.

Non-controlling interests in the acquiree may be initially measured either at fair value or at the non-controllinginterests’ proportionate share of the fair value of the acquiree’s identifiable net assets at the date of acquisition.The choice of measurement basis is made on a transaction-by-transaction basis.





(b) Basis of Consolidation (cont’d)

Business combinations before 1 January 2010

All subsidiaries are consolidated using the purchase method. At the date of acquisition, the fair values of thesubsidiaries’ net assets are determined and these values are reflected in the consolidated financial statements.The cost of acquisition is measured at the aggregate of the fair values, at the date of exchange, of assets given,liabilities incurred or assumed, and equity instruments issued by the Group in exchange for control of the acquiree,plus any costs directly attributable to the business combination.

Non-controlling interests are initially measured at their share of the fair values of the identifiable assets and liabilitiesof the acquiree as at the date of acquisition.

(c) Goodwill

Goodwill is measured at cost less accumulated impairment losses, if any. The carrying value of goodwill is reviewedfor impairment annually. The impairment value of goodwill is recognised immediately in profit or loss. An impairmentloss recognised for goodwill is not reversed in a subsequent period.

Business combinations from 1 January 2010 onwards

Under the acquisition method, any excess of the sum of the fair value of the consideration transferred in the businesscombination, the amount of non-controlling interests recognised and the fair value of the Group’s previously heldequity interest in the acquiree (if any), over the net fair value of the acquiree’s identifiable assets and liabilities atthe date of acquisition is recorded as goodwill.

Where the latter amount exceeds the former, after reassessment, the excess represents a bargain purchase gainand is recognised as a gain in profit or loss.

Business combinations before 1 January 2010

Under the purchase method, goodwill represents the excess of the fair value of the purchase consideration overthe Group’s share of the fair values of the identifiable assets, liabilities and contingent liabilities of the subsidiariesat the date of acquisition.

If, after reassessment, the Group’s interest in the fair values of the identifiable net assets of the subsidiaries exceedsthe cost of the business combinations, the excess is recognised as income immediately in profit or loss.

(d) Functional and Foreign Currencies

(i) Functional and Presentation Currency

The individual financial statements of each entity in the Group are presented in the currency of the primaryeconomic environment in which the entity operates, which is the functional currency.

The consolidated financial statements are presented in Ringgit Malaysia, which is the Company’s functionaland presentation currency.





(d) Functional and Foreign Currencies (cont’d)

(ii) Transactions and Balances

Transactions in foreign currencies are converted into the respective functional currencies on initial recognition,using the exchange rates approximating those ruling at the transaction dates. Monetary assets and liabilitiesat the end of the reporting period are translated at the rates ruling as of that date. Non-monetary assets andliabilities are translated using exchange rates that existed when the values were determined. All exchangedifferences are recognised in profit or loss.

(iii) Foreign Operations

Assets and liabilities of foreign operations are translated to RM at the rates of exchange ruling at the end ofthe reporting period. Revenues and expenses of foreign operations are translated at exchange rates ruling atthe dates of the transactions. All exchange differences arising from translation are taken directly to othercomprehensive income and accumulated in equity under translation reserve. On disposal of a foreignoperation, the cumulative amount recognised in other comprehensive income relating to that particular foreignoperation is reclassified from equity to profit or loss.

Goodwill and fair value adjustments arising from the acquisition of foreign operations are treated as assetsand liabilities of the foreign operations and are recorded in the functional currency of the foreign operationsand translated at the closing rate at the end of the reporting period.

(e) Financial Instruments

Financial instruments are recognised in the statements of financial position when the Group has become a party tothe contractual provisions of the instruments.

Financial instruments are classified as liabilities or equity in accordance with the substance of the contractualarrangement. Interest, dividends, gains and losses relating to a financial instrument classified as a liability, arereported as an expense or income. Distributions to holders of financial instruments classified as equity are chargeddirectly to equity.

Financial instruments are offset when the Group has a legally enforceable right to offset and intends to settle eitheron a net basis or to realise the asset and settle the liability simultaneously.

A financial instrument is recognised initially, at its fair value plus, in the case of a financial instrument not at fairvalue through profit or loss, transaction costs that are directly attributable to the acquisition or issue of the financialinstrument.

Financial instruments recognised in the statements of financial position are disclosed in the individual policystatement associated with each item.

(i) Financial Assets

On initial recognition, financial assets are classified as either financial assets at fair value through profit orloss, held-to-maturity investments, loans and receivables financial assets, or available-for-sale financial assets,as appropriate.





(e) Financial Instruments (cont’d)

(i) Financial Assets (cont’d)

• Financial Assets at Fair Value Through Profit or Loss

Financial assets are classified as financial assets at fair value through profit or loss when the financialasset is either held for trading or is designated to eliminate or significantly reduce a measurement orrecognition inconsistency that would otherwise arise. Derivatives are also classified as held for tradingunless they are designated as hedges.

Financial assets at fair value through profit or loss are stated at fair value, with any gains or losses arisingon remeasurement recognised in profit or loss. Dividend income from this category of financial assetsis recognised in profit or loss when the Company’s right to receive payment is established.

As at the end of the reporting period, there were no financial assets classified under this category.

• Held-to-maturity Investments

Held-to-maturity investments are non-derivative financial assets with fixed or determinable paymentsand fixed maturities that the management has the positive intention and ability to hold to maturity. Held-to-maturity investments are measured at amortised cost using the effective interest method less anyimpairment loss, with revenue recognised on an effective yield basis.

As at the end of the reporting period, there were no financial assets classified under this category.

• Loans and Receivables Financial Assets

Trade receivables and other receivables that have fixed or determinable payments that are not quotedin an active market are classified as loans and receivables financial assets. Loans and receivablesfinancial assets are measured at amortised cost using the effective interest method, less any impairmentloss. Interest income is recognised by applying the effective interest rate, except for short-termreceivables when the recognition of interest would be immaterial.

• Available-for-sale Financial Assets

Available-for-sale financial assets are non-derivative financial assets that are designated in this categoryor are not classified in any of the other categories.

After initial recognition, available-for-sale financial assets are remeasured to their fair values at the endof each reporting period. Gains and losses arising from changes in fair value are recognised in othercomprehensive income and accumulated in the fair value reserve, with the exception of impairmentlosses. On derecognition, the cumulative gain or loss previously accumulated in the fair value reserveis reclassified from equity into profit or loss.

Dividends on available-for-sale equity instruments are recognised in profit or loss when the Group’s rightto receive payments is established.

Investments in equity instruments whose fair value cannot be reliably measured are measured at costless accumulated impairment losses, if any.






(ii) Financial Liabilities

All financial liabilities are initially at fair value plus directly attributable transaction costs and subsequentlymeasured at amortised cost using the effective interest method other than those categorised as fair valuethrough profit or loss.

Fair value through profit or loss category comprises financial liabilities that are either held for trading or aredesignated to eliminate or significantly reduce a measurement or recognition inconsistency that wouldotherwise arise. Derivatives are also classified as held for trading unless they are designated as hedges

(iii) Equity Instruments

Ordinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares oroptions are shown in equity as a deduction, net of tax, from proceeds.

Dividends on ordinary shares are recognised as liabilities when approved for appropriation.

(iv) Treasury Shares

When the Company’s own shares recognised as equity are bought back, the amount of the considerationpaid, including all costs directly attributable, are recognised as a deduction from equity. Own sharespurchased that are not subsequently cancelled are classified as treasury shares and are presented as a deduction from total equity.

Where such shares are subsequently sold or reissued, any consideration received, net of any direct costs, is included in equity.

(v) Guaranteed Redeemable Convertible Exchangeable Bond

FRS 132 - Financial Instruments: Disclosures and Presentation, requires an issuer of a financial instrumentto classify the instrument either as a liability or equity in accordance with the substance of the contractualarrangement on initial recognition. As a consequence, the Guaranteed Redeemable Convertible ExchangeableBond for which the redemption is probable, is classified as a liability under such circumstances.

(vi) Irredeemable Convertible Preference Shares

The irredeemable convertible preference shares are regarded as compound instruments, consisting of aliability component and an equity component. The component of irredeemable convertible preference sharesthat exhibits characteristics of a liability is recognised as a financial liability in the statements of financialposition, net of transaction costs. The dividends on those shares are recognised as interest expense in profitor loss using the effective interest rate method. On issuance of the redeemable convertible preference shares,their fair value of the liability component is determined using a market rate for an equivalent non-convertibledebt and this amount is carried as a financial liability in accordance with the Group’s accounting policy.

The residual amount, after deducting the fair value of the liability component, is the equity component and isincluded in the shareholders’ equity, net of transaction costs.

Transaction costs are apportioned between the liability and equity components of the irredeemable convertiblepreference shares based on the allocation of proceeds to the liability and equity components when theinstruments were first recognised.






(vii) Financial Guarantee Contracts

A financial guarantee contract is a contract that requires the issuer to make specified payments to reimbursethe holder for a loss it incurs because a specific debtor fails to make payment when due.

The Group designates corporate guarantees given to financial institutions for credit facilities granted tosubsidiaries and related parties as insurance contracts as defined in FRS 4 Insurance Contracts. The Grouprecognises these corporate guarantees as liabilities when there is a present obligation, legal or constructive,as a result of a past event, when it is probable that an outflow of resources embodying economic benefits willbe required to settle the obligation and a reliable estimate can be made of the amount of the obligation.

(f) Investments in Subsidiaries

Investments in subsidiaries are stated at cost in the statement of financial position of the Company, and are reviewedfor impairment at the end of the reporting period if events or changes in circumstances indicate that the carryingvalues may not be recoverable.

On the disposal of the investments in subsidiaries, the difference between the net disposal proceeds and thecarrying amount of the investments is recognised in profit or loss.

(g) Investments in Associates

An associate is an entity in which the Group and the company have a long-term equity interest and where itexercises significant influence over the financial and operating policies.

Investments in associates are stated at cost in the statement of financial position of the Company, and are reviewedfor impairment at the end of the reporting period if events or changes in circumstances indicate that the carryingvalues may not be recoverable.

The investment in an associate is accounted for under the equity method, based on the financial statements of theassociate made up to 31 December 2011. The Group's share of the post acquisition profits of the associate isincluded in the consolidated statement of comprehensive income and the Group's interest in the associate is carriedin the consolidated statement of financial position at cost plus the Group's share of the post acquisition retainedprofits and reserves.

Unrealised gains on transactions between the Group and the associate are eliminated to the extent of the Group'sinterest in the associate. Unrealised losses are eliminated unless cost cannot be recovered.

On the disposal of the investments in associates, the difference between the net disposal proceeds and the carryingamount of the investments is recognised in profit or loss.





(h) Property, Plant and Equipment

Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses, if any.

Depreciation is calculated under the straight-line method to write off the depreciable amount of the assets overtheir estimated useful lives. Depreciation of an asset does not cease when the asset becomes idle or is retired fromactive use unless the asset is fully depreciated. The principal annual rates used for this purpose are:-

Leasehold land Over the lease period of 99 yearsLong leasehold building 3%Motor vehicles 20%Plant and machinery 25% - 33%Office equipment 10% - 20%Furniture and fittings 10% - 20%Computer equipment 17% - 33%Renovation 10% - 50%Computer software 20% - 33%Broadband infrastructure 10%

The depreciation method, useful lives and residual values are reviewed, and adjusted if appropriate, at the end ofeach reporting period to ensure that the amounts, method and periods of depreciation are consistent with previousestimates and the expected pattern of consumption of the future economic benefits embodied in the items of theproperty, plant and equipment.

Subsequent costs are included in the assets’ carrying amount or recognised as a separate asset, as appropriate,only when the cost is incurred and it is probable that the future economic benefits associated with the asset willflow to the Group and the cost of the asset can be measured reliably. The carrying amount of parts that are replacedis derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit orloss as incurred. Cost also comprises the initial estimate of dismantling and removing the asset and restoring thesite on which it is located for which the Group is obligated to incur when the asset is acquired, if applicable.

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits areexpected from its use. Any gain or loss arising from derecognition of the asset is recognised in profit or loss.

Capital work-in-progress represents construction of broadband infrastructure which are not ready for commercialuse at the end of the reporting period. Capital work-in-progress comprising mainly broadband infrastructure assetsand equipment are not depreciated until they are ready for intended use.

Broadband infrastructure costs include all expenditure up to and including the last distribution point beforecustomers’ premises. These primarily include materials, transmission and related equipment, contractors’ charges,engineering, site development, interest, labour and other overheads relating to the construction and developmentof the infrastructure. Included in broadband infrastructure costs are also systems and software costs which areintegral to the broadband infrastructure roll-out.





(i) Modems

Expenditure incurred in providing the customer a free modem, provided the customer signs a non-cancellablecontract for a predetermined contractual period, are capitalised as intangible assets and amortised over thecontractual period on a straight line method. These expenditure capitalised are assessed at each reporting datewhether there is any indication that the modems may be impaired.

(j) Intangible Assets

An intangible asset shall be recognised if, and only if it is probable that the expected future economic benefits thatare attributable to the asset will flow to the entity and that the cost of the asset can be measured reliably. An entityshall assess the probability of the expected future economic benefits using reasonable and supportableassumptions that represent management’s best estimate of the set of economic conditions that will exist over theuseful life of the asset. An intangible asset shall be measured initially at cost.

The useful lives of intangible assets are assessed to be either finite or indefinite.

Intangible assets with finite lives are amortised over their useful economic lives and assessed for impairmentwhenever there is an indication that the intangible assets may be impaired. The amortisation period and theamortisation method for an intangible asset with a finite useful life is reviewed at least at each financial year-end.Changes in the expected useful life or the expected pattern of consumption of future economic benefits embodiedin the asset is accounted for by changing the amortisation period or method, as appropriate, and treated as changesin accounting estimates. The amortisation expense on intangible assets with finite lives is recognised in profit orloss in the expense category consistent with the function of the intangible asset.

Intangible assets with indefinite useful lives are tested for impairment annually either individually or at the cashgenerating unit level. Such intangibles are not amortised. The useful life of an intangible asset with an indefinite lifeis reviewed annually to determine whether indefinite life assessment continues to be supportable. If not, the changein the useful life assessment from indefinite to finite is made on a prospective basis.

(k) Intellectual Property

The intellectual property consists of the acquisition cost of the exclusive rights of a suite of software modules,including the trademarks, copyright, source codes and associated documentation. The acquisition cost iscapitalised as an intangible asset as it is able to generate future economic benefits to the Group.

The intellectual property is amortised on a straight-line basis over the period of 10 years during which its economicbenefits are expected to be consumed.





(l) Research and Development Expenditure

Research expenditure is recognised as an expense when it is incurred.

Development expenditure is recognised as an expense except that costs incurred on development projects arecapitalised as long-term assets to the extent that such expenditure is expected to generate future economicbenefits. Development expenditure is capitalised if, and only if an entity can demonstrate all of the following:-

(i) its ability to measure reliably the expenditure attributable to the asset under development;

(ii) the product or process is technically and commercially feasible;

(iii) its future economic benefits are probable;

(iv) its ability to use or sell the developed asset; and

(v) the availability of adequate technical, financial and other resources to complete the asset under development.

Capitalised development expenditure is measured at cost less accumulated amortisation and impairment losses,if any. Development expenditure initially recognised as an expense is not recognised as assets in the subsequentperiod.

The development expenditure is amortised on a straight-line method over a periods of 3 to 10 years when theproducts are ready for sale or use. In the event that the expected future economic benefits are no longer probableof being recovered, the development expenditure is written down to its recoverable amount.

(m) Impairment

(i) Impairment of Financial Assets

All financial assets (other than those categorised at fair value through profit or loss), are assessed at the endof each reporting period whether there is any objective evidence of impairment as a result of one or moreevents having an impact on the estimated future cash flows of the asset. For an equity instrument, a significantor prolonged decline in the fair value below its cost is considered to be objective evidence of impairment.

An impairment loss in respect of held-to-maturity investments and loans and receivables financial assets isrecognised in profit or loss and is measured as the difference between the asset’s carrying amount and thepresent value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.

An impairment loss in respect of available-for-sale financial assets is recognised in profit or loss and ismeasured as the difference between its cost (net of any principal payment and amortisation) and its currentfair value, less any impairment loss previously recognised in the fair value reserve. In addition, the cumulativeloss recognised in other comprehensive income and accumulated in equity under fair value reserve, isreclassified from equity to profit or loss.

With the exception of available-for-sale equity instruments, if, in a subsequent period, the amount of theimpairment loss decreases and the decrease can be related objectively to an event occurring after theimpairment was recognised, the previously recognised impairment loss is reversed through profit or loss tothe extent that the carrying amount of the investment at the date the impairment is reversed does not exceedwhat the amortised cost would have been had the impairment not been recognised. In respect of available-for-sale equity instruments, impairment losses previously recognised in profit or loss are not reversed throughprofit or loss. Any increase in fair value subsequent to an impairment loss made is recognised in othercomprehensive income.





(m) Impairment (Cont’d)

(ii) Impairment of Non-Financial Assets

The carrying values of assets, other than those to which FRS 136 - Impairment of Assets does not apply, arereviewed at the end of each reporting period for impairment when there is an indication that the assets mightbe impaired. Impairment is measured by comparing the carrying values of the assets with their recoverableamounts. The recoverable amount of the assets is the higher of the assets' fair value less costs to sell andtheir value-in-use, which is measured by reference to discounted future cash flow.

An impairment loss is recognised in profit or loss immediately unless the asset is carried at its revaluedamount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extent of a previously recognised revaluation surplus for the same asset.

In respect of assets other than goodwill, and when there is a change in the estimates used to determine therecoverable amount, a subsequent increase in the recoverable amount of an asset is treated as a reversal ofthe previous impairment loss and is recognised to the extent of the carrying amount of the asset that wouldhave been determined (net of amortisation and depreciation) had no impairment loss been recognised. Thereversal is recognised in profit or loss immediately, unless the asset is carried at its revalued amount. A reversal of an impairment loss on a revalued asset is credited to other comprehensive income. However, tothe extent that an impairment loss on the same revalued asset was previously recognised as an expense inthe statements of comprehensive income, a reversal of that impairment loss is recognised as income in thestatements of comprehensive income.

(n) Assets under Hire Purchase

Assets acquired under hire purchase are capitalised in the financial statements and are depreciated inaccordance with the policy set out in Note 4(h) above. Each hire purchase payment is allocated between theliability and finance charges so as to achieve a constant rate on the finance balance outstanding. Financecharges are recognised in profit or loss over the period of the respective hire purchase agreements.

(o) Inventories

Inventories are stated at the lower of cost and net realisable value. Cost is determined on the weightedaverage basis and comprises the purchase price and incidentals incurred in bringing the inventories to theirpresent location and condition.

Net realisable value represents the estimated selling price less the estimated costs necessary to make the sale.

Where necessary, due allowance is made for all damaged, obsolete and slow-moving items. The Group writesdown its obsolete or slow moving inventories based on assessment of the condition and the future demandfor the inventories. These inventories are written down when events or changes in circumstances indicate thatthe carrying amounts may not be recovered.





(p) Income Taxes

Income tax for the year comprises current and deferred tax.

Current tax is the expected amount of income taxes payable in respect of the taxable profit for the year and ismeasured using the tax rates that have been enacted or substantively enacted at the end of the reporting period.

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

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

Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused taxcredits to the extent that it is probable that future taxable profits will be available against which the deductibletemporary differences, unused tax losses and unused tax credits can be utilised. The carrying amounts of deferredtax assets are reviewed at the end of each reporting period and reduced to the extent that it is no longer probablethat sufficient future taxable profits will be available to allow all or part of the deferred tax assets to be utilised.

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

Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assetsagainst current tax liabilities and when the deferred income taxes relate to the same taxation authority.

Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred taxitems are recognised in correlation to the underlying transactions either in other comprehensive income or directlyin equity and deferred tax arising from a business combination is included in the resulting goodwill or excess of theacquirer’s interest in the net fair value of the acquiree’s identifiable assets, liabilities and contingent liabilities overthe business combination costs.

(q) Cash and Cash Equivalents

Cash and cash equivalents comprise cash in hand, bank balances, demand deposits, deposits pledged withfinancial institutions, bank overdrafts and short-term, highly liquid investments that are readily convertible to knownamounts of cash and which are subject to an insignificant risk of changes in value.

(r) Provisions

Provisions are recognised when the Group has a present obligation as a result of past events, when it is probablethat an outflow of resources embodying economic benefits will be required to settle the obligation, and when areliable estimate of the amount can be made. Provisions are reviewed at the end of each reporting period andadjusted to reflect the current best estimate. Where the effect of the time value of money is material, the provisionis the present value of the estimated expenditure required to settle the obligation.





(s) Employee Benefits

(i) Short-term Benefits

Wages, salaries, paid annual leave and sick leave, bonuses and non-monetary benefits are recognised inprofit or loss and included in the development costs, where appropriate, in the period in which the associatedservices are rendered by employees of the Group.

(ii) Defined Contribution Plans

The Group’s contributions to defined contribution plans are recognised in profit or loss and included in thedevelopment costs, where appropriate, in the period to which they relate. Once the contributions have beenpaid, the Group has no further liability in respect of the defined contribution plans.

(iii) Share-based Payment Transactions

At grant date, the fair value of options granted to employees is recognised as an employee expense, with acorresponding increase in equity, over the period in which the employees become unconditionally entitled tothe options. The amount recognised as an expense is adjusted to reflect the actual number of share optionsthat are expected to vest.

(t) Related Parties

A party is related to an entity if:-

(i) directly, or indirectly through one or more intermediaries, the party:- • controls, is controlled by, or is under common control with, the entity (this includes parents, subsidiaries

and fellow subsidiaries);• has an interest in the entity that gives it significant influence over the entity; or• has joint control over the entity;

(ii) the party is an associate of the entity;(iii) the party is a joint venture in which the entity is a venturer;(iv) the party is a member of the key management personnel of the entity or its parent;(v) the party is a close member of the family of any individual referred to in (i) or (iv);(vi) the party is an entity that is controlled, jointly controlled or significantly influenced by, or for which significant

voting power in such entity resides with, directly or indirectly, any individual referred to in (iv) or (v); or(vii) the party is a post-employment benefit plan for the benefit of employees of the entity, or of any entity that is a

related party of the entity.

Close members of the family of an individual are those family members who may be expected to influence, or beinfluenced by, that individual in their dealings with the entity.

(u) Contingent Liabilities

A contingent liability is a possible obligation that arises from past events and whose existence will only be confirmedby the occurrence of one or more uncertain future events not wholly within the control of the Group. It can also bea present obligation arising from past events that is not recognised because it is not probable that an outflow ofeconomic resources will be required or the amount of obligation cannot be measured reliably.

A contingent liability is not recognised but is disclosed in the notes to the financial statements. When a change inthe probability of an outflow occurs so that the outflow is probable, it will then be recognised as a provision.





(v) Revenue Recognition

(i) Sale of Goods

Revenue is recognised upon delivery of goods and customers’ acceptance and where applicable, net of returns and trade discounts.

(ii) Services

Revenue is recognised upon the rendering of services and when the outcome of the transaction can beestimated reliably. In the event the outcome of the transaction could not be estimated reliably, revenue isrecognised to the extent of the expenses incurred that are recoverable.

(iii) Interest Income

Interest income is recognised on an accrual basis.

(iv) Dividend Income

Dividend income from investment is recognised when the right to receive dividend payment is established.

(v) Rental Income

Rental income is recognised on an accrual basis.

(w) Operating Segments

An operating segment is a component of the Group that engages in business activities from which it may earnrevenues and incur expenses, including revenues and expenses that relate to transactions with any of the Group’sother components. An operating segment’s operating results are reviewed regularly by the chief operating decisionmaker to make decisions about resources to be allocated to the segment and assess its performance, and for whichdiscrete financial information is available.

(x) Borrowing Costs

Borrowing costs, directly attributable to the acquisition and construction of property, plant and equipment arecapitalised as part of the cost of those assets, until such time as the assets are ready for their intended use or sale.Capitalisation of borrowing costs is suspended during extended periods in which active development is interrupted

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




5. INVESTMENTS IN SUBSIDIARIES

The Company2011 2010

RM’000 RM’000

Unquoted shares, at cost- in Malaysia 41,431 41,431- outside Malaysia 52,210 48,823

93,641 90,254Accumulated impairment losses:-At 1 January (22,235) (11,000)Addition during the financial year (4,800) (11,235)

At 31 December (27,035) (22,235)

66,606 68,019

Details of the subsidiaries are as follows:-

Country of Effective EquityName of Company Incorporation Interest Principal Activities

2011 2010

Green Packet (Shanghai) The People’s 100% 100% Research, development, marketing and Ltd. * Republic of distribution of wireless networking

and telecommunications products and solutions.

Green Packet Ventures The British 100% 100% Investment holding.Ltd. Virgin Islands

Green Packet Networks The Republic 100% 100% Investment holding.(Singapore) Pte. Ltd. of Singapore(“GPNS”) *

Green Packet (Australia) Australia 100% 100% Marketing of wireless broadband Pty. Ltd. (“GPA”)* © equipment, systems and solutions.

Green Packet International Malaysia 100% 100% Dormant.Sdn. Bhd.

Packet One Sdn. Bhd. Malaysia 100% 100% Investment holding.(“POSB”)

First Wireless Sdn. Bhd. Malaysia 70% 70% Development and marketing of wirelessbroadband equipment, systems and solutions.

Next Telecommunications Malaysia 100% 100% Provision of total communication Sdn. Bhd. (“NTSB”) services, solutions and products.




5. INVESTMENTS IN SUBSIDIARIES (CONT’D)


2011 2010

Millercom Sdn. Bhd. Malaysia 55% 55% Sales agent of prepaid cards and call(“MSB”) @* shop sales.

Next Global TechnologySdn. Bhd. (“NGTSB”) Malaysia 100% 100% Research and development of total value

added data network and communication services.

Packet One Networks Malaysia 55% 55% Provision of last mile broadband network (Malaysia) Sdn. Bhd. infrastructure facilities and services. (“PONSB”) *^©

Packet Interactive Malaysia 100% 100% Provision of total contents and value addedSdn. Bhd. services.

P1. Com Sdn. Bhd. Malaysia 55% 55% A collector of telecommunications revenue(“P1CSB”) @* for fellow group companies.

Green Packet Networks Kingdom of 100% 100% Supply and management of S.P.C (formerly known as Bahrain telecommunications network equipmentGreen Packet NetworksW.L.L)* ©

Green Packet Networks Taiwan 100% 100% Marketing and distribution of wireless(Taiwan) Pte. Ltd. networking and telecommunications(“GPNTPL”) * products, networking solutions and other

high technology products and services.

Green Packet (L) Ltd. Malaysia 100% 100% Investment holding and special purpose (“GPLL”) * vehicle for procurement of funds.

NGT Networks Pte. Ltd *# The Republic 100% 100% Provision of international voice traffic.of Singapore

RuumzNation Sdn. Bhd. Malaysia 55% 55% Provision of social online networking (“RNSB”) @* services.

OneVois Sdn. Bhd. Malaysia - 100% Provision of total communication services, (“OVSB”) # solutions and products.

OneVois Global Co Ltd Thailand - 33% Provision of total communication services,(“OVG”) ##* solutions and products




5. INVESTMENTS IN SUBSIDIARIES (CONT’D)


2011 2010

Worldline Enterprise Sdn. Malaysia 100% 100% Letting and management of propertiesBhd. (“WESB”) and property investment.

Packet One International The Republic 70% 70% Provision of total consultancy services,Pte. Ltd (“POI”) * of Singapore solutions and products.

Packet One (S) Pte. Ltd The Republic 100% 100% Provision of last mile broadband network (“P1s”) * of Singapore infrastructure facilities and services.

Inova Venture Pte. The Republic 71% 71% Provision of support services toLtd. (“IVPL”) ^* of Singapore telecommunication industry, general

importers and exporters.

Green Packet (US) United States 100% - Marketing of wireless broadbandLLC^^ of America equipment, systems and solutions.

* Not audited by Messrs. Crowe Horwath.

© The auditors’ report on the financial statements of these subsidiaries contain an emphasis of matter on the

preparation of financial statements on a going concern basis.

# Held through NGTSB

## Held through GPNS (carries 60% effective voting rights in OVG)

@ Held through PONSB.

^ Held through Green Packet Ventures Ltd.(carries 20% direct voting rights and 51% directing voting rights by Green

Packet Berhad)

^^ Held through GPA

The Company assessed the recoverable amount of the investments in subsidiaries and determined that an impairmentloss should be recognised as the recoverable amount is lower than the carrying amount. The recoverable amount of thecash-generating unit is determined using the fair value less costs to sell approach, and this is derived from the net assetsposition of the respective subsidiaries as at the end of the reporting period.

The net assets position of the respective subsidiaries as at the end of the current reporting period has declined in thecurrent financial year which was attributed to the losses incurred in the current and previous financial year.

On 30 March 2011, Green Packet (Australia) Pty. Ltd., a wholly owned subsidiary of GPB, incorporated a wholly-ownedsubsidiary in the United States of America known as Green Packet (US) LLC. Its registered office is located at 160,Greentree Drive, Suite 101 in the City of Dover, DE 19904 County of Kent, State of Delaware, California.

On 6 September 2011, One Vois Global Co. Ltd, a company in which Green Packet Networks (Singapore) Pte Ltd (“GPNS”)has a 33% equity interest was liquidated. GPNS is a wholly owned subsidiary of the Company.

On 9 September 2011, Next Global Technology Sdn. Bhd. a wholly owned subsidiary of the Company disposed of itsshareholding of 2 ordinary shares of RM1.00 each (“Shares Sale”), representing a 100% of the total issued and paid upshare capital in Onevois Sdn. Bhd., to Newflex Communications Sdn. Bhd. for a total cash consideration of RM2,991. As a result of the Shares Sale, Onevois Sdn. Bhd. ceased to be the subsidiary.




6. INVESTMENTS IN ASSOCIATES


RM’000 RM’000 RM’000 RM’000

Unquoted shares, at cost - 29,733 - 29,733Share of post acquisition loss - (24,422) - -Gain on dilution of investment - 5,192 - -

- 10,503 - 29,733Accumulated impairment loss:- At 1 January (10,503) (9,625) (29,733) (9,625)Addition during the year - (878) - (20,108)Written off 10,503 - 29,733 -

- (10,503) - (29,733)

At 31 December - - - -

Details of the associates are as follows:-


2011 2010

GMO Global Limited The British - 27.9% Investment holding.(“GMO”) Virgin Islands

MH Capital Inc. * The British - 19.5% Research and development of wireless(“MHC”) Virgin Islands networking and telecommunication

products, networking solutions and otherhigh technology products and services.

MH Technology Limited * The People’s - 19.5% Research, development and (“MHT”) Republic of China commercialisation of internet application,

telecommunication and multimedia technology, design and production of webpage and other related technical training and services.

* Held through GMO Global Limited.




6. INVESTMENTS IN ASSOCIATES (CONT’D)

The summarised financial information of the associates are as follows:-

2011 2010RM’000 RM’000

ASSETS AND LIABILITIESTotal assets - 5,268Total liabilities - (1,049)

ResultsRevenue - 13,761Profit/(Loss) for the year - (61,702)

In the previous financial year, the Group had recognised full impairment loss on the investments in associates. Theimpairment was made by the directors after taking into consideration the continued operating losses reported by theseassociates. During the financial year, the GMO disposed of all of its investments in MHC and MHT. GMO became adormant company and was subsequently wound up.




7. PROPERTY, PLANT AND EQUIPMENT

Disposal/At Written Depreciation At

1.1.2011 Additions Off Transfer Charge 31.12.2011THE GROUP RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

NET BOOK VALUELeasehold land 16,641 - - - (289) 16,352 Long leasehold buildings 17,144 - - - (530) 16,614Motor vehicles 975 - (21) - (584) 370 Plant and machinery 407 157 (420) - (134) 10 Office equipment 5,753 1,379 (301) (15) (4,943) 1,873Furniture and fittings 1,798 13 (13) - (1,292) 506 Computer equipment 1,585 6,634 (286) 3,468 (3,224) 8,177 Renovation 6,440 684 (28) - (3,651) 3,445 Computer software 12,960 186 (14) - (170) 12,962 Broadband infrastructure 436,086 7,774 - 130,367 (53,611) 520,616 Capital work-in-progress 5,201 166,601 - (130,170) - 41,632

504,990 183,428 (1,083) 3,650 (68,428) 622,557

Disposals/At Written Depreciation At

1.1.2010 Additions Off Transfer Charge 31.12.2010THE GROUP RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

NET BOOK VALUELeasehold land 17,171 - - - (530) 16,641Long leasehold buildings 17,433 - - - (289) 17,144Motor vehicles 1,300 228 - - (553) 975Plant and machinery 689 43 (97) - (228) 407Office equipment 5,184 1,300 (17) - (714) 5,753Furniture and fittings 1,903 624 (14) - (715) 1,798Computer equipment 3,547 1,756 (39) - (3,679) 1,585Renovation 8,297 781 (50) - (2,588) 6,440Computer software 13,244 97 - - (381) 12,960Broadband infrastructure 276,592 76,184 - 125,600 (42,290) 436,086Capital work-in-progress 129,307 1,494 - (125,600) - 5,201

474,667 82,507 (217) - (51,967) 504,990




7. PROPERTY, PLANT AND EQUIPMENT (CONT’D)

Accumulated Net BookAt Cost Depreciation Value

THE GROUP RM’000 RM’000 RM’000

At 31.12.2011

Leasehold land 17,657 (1,305) 16,352 Long leasehold buildings 17,656 (1,042) 16,614Motor vehicles 3,248 (2,878) 370 Plant and machinery 5,931 (5,921) 10 Office equipment 11,046 (9,173) 1,873Furniture and fittings 3,091 (2,585) 506 Computer equipment 18,830 (10,653) 8,177 Renovation 11,855 (8,410) 3,445 Computer software 15,047 (2,085) 12,962 Broadband infrastructure 629,265 (108,649) 520,616 Capital work-in-progress 41,632 - 41,632

775,258 (152,701) 622,557

Accumulated Net BookAt Cost Depreciation ValueRM’000 RM’000 RM’000

At 31.12.2010

Leasehold land 17,657 (1,016) 16,641Long leasehold buildings 17,656 (512) 17,144Motor vehicles 3,269 (2,294) 975Plant and machinery 6,194 (5,787) 407Office equipment 9,983 (4,230) 5,753Furniture and fittings 3,091 (1,293) 1,798Computer equipment 9,014 (7,429) 1,585Renovation 11,199 (4,759) 6,440Computer software 14,875 (1,915) 12,960Broadband infrastructure 491,124 (55,038) 436,086Capital work-in-progress 5,201 - 5,201

589,263 (84,273) 504,990





At Written Depreciation At1.1.2011 Additions Off Charge 31.12.2011

THE COMPANY RM’000 RM’000 RM’000 RM’000 RM’000

NET BOOK VALUE

Motor vehicles 137 - - (137) -Plant and machinery 33 238 - (134) 137Office equipment 269 18 (204) (51) 32Furniture and fittings 268 180 - (110) 338Computer equipment 650 268 (39) (332) 547Renovation 3,476 - (45) (1,153) 2,278Computer software 298 194 (136) (132) 224

5,131 898 (424) (2,049) 3,556

At Written Depreciation At1.1.2010 Additions Off Charge 31.12.2010

THE COMPANY RM’000 RM’000 RM’000 RM’000 RM’000

NET BOOK VALUE

Motor vehicles 392 - - (255) 137Plant and machinery 160 97 - (224) 33Office equipment 303 23 - (57) 269Furniture and fittings 431 40 (6) (197) 268Computer equipment 929 60 (8) (331) 650Renovation 4,398 203 - (1,125) 3,476Computer software 206 168 - (76) 298

6,819 591 (14) (2,265) 5,131

Accumulated Net BookAt Cost Depreciation ValueRM’000 RM’000 RM’000

THE COMPANY

At 31.12.2011

Motor vehicles 1,667 (1,667) -Plant and machinery 1,913 (1,776) 137Office equipment 414 (382) 32Furniture and fittings 849 (511) 338Computer equipment 1,604 (1,057) 547Renovation 5,849 (3,571) 2,278Computer software 779 (555) 224

13,075 (9,519) 3,556





Accumulated Net BookAt Cost Depreciation Value

THE COMPANY RM’000 RM’000 RM’000

At 31.12.2010

Motor vehicles 1,667 (1,530) 137Plant and machinery 1,675 (1,642) 33Office equipment 600 (331) 269Furniture and fittings 669 (401) 268Computer equipment 1,375 (725) 650Renovation 5,894 (2,418) 3,476Computer software 721 (423) 298

12,601 (7,470) 5,131

Included in property, plant and equipment of the Group and of the Company are the following assets held under hirepurchase terms:-


RM’000 RM’000 RM’000 RM’000

Motor vehicles 559 870 - 137Computer equipment 982 349 103 186Computer software 1,583 1,984 - - Capital work-in-progress 7 12,227 7 -

3,131 15,430 110 323

The long leasehold land and building have been pledged as security for banking facilities granted to the Company asdisclosed in Note 23 to the financial statements.

The depreciation charge of the Group and of the Company are allocated as follows:-


RM’000 RM’000 RM’000 RM’000

Profit or loss 67,638 51,219 1,718 1,977Development costs (Note10) 790 748 331 288

68,428 51,967 2,049 2,265




8. OTHER INVESTMENTS


Note RM’000 RM’000 RM’000 RM’000

Unquoted shares, at cost (a),(c) 18,628 18,628 18,628 18,628Unquoted shares, at fair value (b) - - 635,479 425,015Club membership (c) 135 135 135 135

18,763 18,763 654,242 443,778

Impairment loss:-At 1 January (18,628) (9,500) (18,628) (9,500)Addition during the financial year - (9,128) - (9,128)

At 31 December (18,628) (18,628) (18,628) (18,628)

135 135 635,614 425,150

(a) The unquoted shares, at cost, of the Group relate to investments of 3.0million Series B preferred stock of USD0.67each, 2.0million Series C preferred stock of USD1.00 each, 200,000 Series D preferred stock of USD1.00 each and1,815,736 Series E preferred stock of USD1.00 each in IWICS Inc., a company incorporated in the United States ofAmerica.

The Group has recognised full impairment loss on these investments as the directors are of the opinion that theexpected future return of these investments is uncertain.

(b) The unquoted shares, at fair value, relate to the investment in Islamic Irredeemable Convertible Preference Shares(“IICPS”) in an indirect subsidiary, PONSB. This investment is designated as available-for-sale financial assets andmeasured at fair value.

During the current financial year, the Company increased its investment in unquoted shares, at fair value, by anadditional subscription of approximately RM101 million (2010: RM39.7 million) IICPS.

(c) These investments are designated as available-for-sale financial assets and are stated at cost as their fair valuescannot be reliably measured using valuation techniques due to the lack of marketability of these investments.

9. GOODWILL

The Group2011 2010

RM’000 RM’000

At 1 January/31 December 23,141 23,141

Impairment loss:-At 1 January (4,330) -Addition during the year (5,807) (4,330)

Less: Accumulated impairment losses (10,137) (4,330)

At 31 December 13,004 18,811




9. GOODWILL (CONT’D)

(a) The carrying amounts of goodwill allocated to each cash-generating unit are as follows:-The Group

2011 2010RM’000 RM’000

Solution group 6,145 6,145Broadband services 6,859 6,859Communication Services - 5,807

13,004 18,811

(b) The Group has assessed the recoverable amounts of goodwill allocated and provided for impairment whererequired. The recoverable amounts of the cash-generating units are determined using the value-in-use approach,and this is derived from the present value of the future cash flows from the operating segments computed basedon the projections of financial budgets approved by management covering a period of 5 years. The key assumptionsused in the determination of the recoverable amounts are as follows:-

Gross Margin Growth Rate Discount Rate2011 2010 2011 2010 2011 2010

Solution group 26% 17% 21% 26% 12% 12%Broadband services 78% 70% 27% 43% 12% 12%Communication services - 20% - 20% - 12%

(a) Budgeted gross margin The basis used to determine the value assigned to the budgeted grossmargin is the average gross margins achieved in the year immediatelybefore the budgeted year increased for expected efficiency improvementsand cost saving measures.

(b) Growth rate The growth rates used are based on the expected projection of the wirelessrelated products and discounted telephony services.

(c) Discount rate The discount rates used are pre-tax and reflect specific risks relating to therelevant segments.




10. DEVELOPMENT COSTS


RM’000 RM’000 RM’000 RM’000

At 1 January 58,434 68,888 24,110 18,811Development costs capitalised during thefinancial year 5,893 4,477 6,771 8,723

Development costs written off (6,542) (14,931) (6,491) (3,424)Reclassification (4,136) - - -

53,649 58,434 24,390 24,110Government grants (489) (489) (489) (489)

53,160 57,945 23,901 23,621

Amortisation of development costs:-

At 1 January (13,038) (7,609) (5,752) (3,040)Amortisation charge (5,407) (5,429) (3,261) (2,712)Reclassification 486 - - -

(17,959) (13,038) (9,013) (5,752)

At 31 December 35,201 44,907 14,888 17,869

Development costs for the financial year included the following expenses:-


RM’000 RM’000 RM’000 RM’000

Depreciation of plant and equipment 790 748 331 288Interest expense 10 10 - - Rental of premises 113 91 113 90Staff costs 3,531 2,421 2,436 1,326




11. INTANGIBLE ASSETS

IntellectualProperty Modems TotalRM’000 RM’000 RM’000

COSTAt 1 January 2010 22,800 60,676 83,476Additions - 60,200 60,200

At 31 December 2010/1 January 2011 22,800 120,876 143,676Addition - 56,993 56,993Written off - (68,568) (68,568)

At 31 December 2011 22,800 109,301 132,101

AMORTISATIONAt 1 January 2010 13,300 30,225 43,525Additions 2,280 28,838 31,118

At 31 December 2010/1 January 2011 15,580 59,063 74,643Additions 2,280 57,343 59,623Written off - (67,173) (67,173)

At 31 December 2011 17,860 49,233 67,093

CARRYING AMOUNTSAt 31 December 2010/1 January 2011 7,220 61,813 69,033

At 31 December 2011 4,940 60,068 65,008

The intellectual property comprises the purchase price of the GP Base Software.

Modems represent costs incurred to provide customers with free modems and are amortised over the contractual period.




12. INVENTORIES


RM’000 RM’000 RM’000 RM’000

AT COST:-Inventories held for resale 31,057 21,779 7,272 12,207

Work-in-progress 475 - 475 -

31,532 21,779 7,747 12,207

None of the inventories is carried at net realised value.

13. TRADE RECEIVABLES


RM’000 RM’000 RM’000 RM’000

Trade receivables 86,134 75,470 30,511 16,367Allowance for impairment loss (14,839) (14,957) - (4,196)

71,295 60,513 30,511 12,171

Allowance for impairment lossAt 1 January (14,957) (8,918) (4,196) -Addition for the financial year (17,689) (6,039) - (4,196)Written off 17,807 - 4,196 -

At 31 December (14,839) (14,957) - (4,196)

Included in trade receivables of the Group and of the Company is the following:-

The Group/The Company

Note 2011 2010RM’000 RM’000

Green Packet, Inc. (a) 3,897 3,682

(a) A related party in which Tan Sri Dato’ Kok Onn and Puan Chan Cheong have substantial financial interests.

The Group’s normal trade credit terms range from 30 to 90 days. Other credit terms are assessed and approved on acase-by-case basis.




14. OTHER RECEIVABLES, DEPOSITS AND PREPAYMENTS


RM’000 RM’000 RM’000 RM’000

Other receivables 61,645 62,626 7,526 8,390Allowance for impairment loss (363) (1,667) (1,304) (1,304)

61,282 60,959 6,222 7,086

Allowance for impairment lossAt 1 January (1,667) (363) (1,304) -Addition for the financial year - (1,304) - (1,304)Written off 1,304 - 1,304 -

At 31 December (363) (1,667) - (1,304)

15. AMOUNTS OWING BY/(TO) SUBSIDIARIES

The amounts owing by/(to) subsidiaries consist of the followings:-


RM’000 RM’000

Amount owing by:-Current- trade 26,909 2,204- non-trade 78,010 68,463

104,919 70,667Non-current- non-trade 50,000 141,000

154,919 211,667

Represented by:-At cost 50,000 141,000At amortised cost 104,919 70,667

154,919 211,667




15. AMOUNTS OWING BY/(TO) SUBSIDIARIES (CONT’D)

The amounts owing by/(to) subsidiaries consist of the followings:-(cont’d)


RM’000 RM’000

Amount owing to:-Current- trade - (1,594)- non-trade 113,943 141,797

113,943 140,203

Represented by:-At amortised cost 113,943 140,203

113,943 140,203

The trade amounts are subject to normal credit terms. The non-trade amounts are unsecured, interest-free andrepayable/receivable on demand. The amount owing is to be settled in cash.

During the financial year, an amount of RM50,000,000 (2010: RM141,046,112) owing by a subsidiary for which thesettlement is neither planned nor likely to occur in the foreseeable future. Accordingly, this amount has been classifiedas a non-current asset and is stated at cost less accumulated impairment loss, if any as this amount is in substance, apart of the Company’s net investment in the subsidiary. The reduction of this amount by RM91 million during the financialyear was due to the conversion and capitalisation of the investment in unquoted shares in PONSB as further disclosedin Note 43(b) to the financial statements.

16. DEPOSITS WITH LICENSED BANKS

The effective interest rate of the deposits at the end of the reporting period is 2.75% (2010 - 2.0% to 3.0%) per annum.The deposits have a maturity period of 12 months (2010 - 1 month to 3 months).

Included in the fixed deposits with licensed banks is an amount of RM1,191,000 (2010 - RM1,159,000) pledged to alicensed bank for banking facilities granted to the Group

17. CASH AND BANK BALANCES

Included in the cash at bank of the Company at the end of the reporting period is an amount of approximatelyRM67,968,221 (2010: RM80,136,295) held in the account of a foreign subsidiary.




18. SHARE CAPITAL

The movements in the authorised share capital of the Company are as follows:-

2011 2010Par Number Share Par Number Share

Value Of Capital Value Of CapitalRM Shares RM RM Shares RM

‘000 ‘000 ‘000 ‘000ORDINARY SHARES

At 1 January/31 December 0.20 2,000,000 400,000 0.20 2,000,000 400,000

The movements in the issued and paid-up share capital of the Company are as follows:-

2011 2010Par Number Share Par Number Share

Value Of Capital Value Of CapitalRM Shares RM RM Shares RM

‘000 ‘000 ‘000 ‘000ORDINARY SHARES

At 1 January 0.20 657,753 131,551 0.20 657,304 131,461

Issuance of ordinary shares pursuant to ESOS 0.20 - - 0.20 449 90

At 31 December 0.20 657,753 131,551 0.20 657,753 131,551

19. TREASURY SHARES

There were no purchases of any ordinary shares from the open market during the financial year. As at 31 December 2011,the total number of shares held as treasury shares amounted to 4,707,700 ordinary shares. The treasury shares are heldat a carrying amount of RM11,388,802. None of the treasury shares were resold or cancelled during the financial yearended 31 December 2011.

20. RESERVES


RM’000 RM’000 RM’000 RM’000

Share premium 345,372 345,372 345,372 345,372Translation reserve 378 47 7 3Employees’ share option reserve 18,078 14,779 17,338 14,779Fair value reserve - - 183,255 74,000Warrant reserve 57,714 57,714 57,714 57,714(Accumulated losses)/ Retained profits (368,828) (283,103) 14,575 (6,608)

52,714 134,809 618,261 485,260




20. RESERVES (CONT’D)

(a) Share Premium

The movements of the share premium of the Group and the Company are as follows:

The Group/The Company

2011 2010RM’000 RM’000

At 1 January 345,372 345,530Expenses incurred for private placement - (428)Premium arising from ESOS - 270

At 31 December 345,372 345,372

The share premium is not distributable by way of dividends and may be utilised in the manner set out in Section60(3) of the Companies Act, 1965.

(b) Translation Reserve

The translation reserve arose from the translation of the financial statements of foreign subsidiaries and is notdistributable by way of dividends.

(c) Employees’ Share Option Reserve

The employees’ share option reserve represents the equity-settled share options granted to employees. The reserveis made up of the cumulative value of services received from employees recorded over the vesting periodcommencing from the grant date of equity-settled share options, and is reduced by the expiry or exercise of theshare options.

The movement in the options to subscribe for new ordinary shares of RM0.20 each at the respective adjustedexercise price per share is as follows:-

Number Of Options Over Ordinary Shares Of RM0.20 Each At The Adjusted Exercise Price Of:-


As at 1 January 2011 7,140 7,452 7,201 10,083 -Granted during the financial year - - - - 10,500Cancellation due to staff resignations (609) (1,117) (1,041) (1,544) (1,461)Exercised during the financial year - - - - -

As at 31 December 2011 6,531 6,335 6,160 8,539 9,039




20. RESERVES (CONT’D)

(c) Employees’ Share Option Reserve (cont’d)

The fair values of the share options granted were estimated using a binomial model, taking into account the termsand conditions upon which the options were granted. The fair values of the share options measured at grant dateand the assumptions used are as follows:-

Number Of Options Over Ordinary Shares Of RM0.20 Each At The Adjusted Exercise Price Of:-


Fair value of share options at the grant date (RM) 0.91 0.73 0.37 0.30 0.30Share price (RM) 3.18 2.25 0.89 1.23 0.65Exercise price (RM) 4.22 1.97 0.80 1.10 0.60Expected volatility (%) 31.43 36.80 36.80 17.50 16.50Expected life (years) 5.00 3.50 2.50 5.00 4.00Risk free rate (%) 3.81 3.81 3.81 3.55 3.55Dividend yield (%) 1.32 - - - -

(d) Fair Value Reserve

The fair value reserve represents the cumulative fair value changes (net of tax, where applicable) of available-for-sale financial assets until they are disposed of or impaired.

(e) Warrant Reserve

The warrant reserve arose from the allocation of the proceeds received from the issuance of the Warrants byreference to the fair value of the Warrants net of discount, amounting to RM0.30 per Warrant and net of expensesincurred in relation to the Rights Issue completed on 28 September 2010.

(f) Retained Profits

Subject to the agreement of the tax authorities, at the end of the reporting period, the Company has sufficient taxcredits under Section 108 of the Income tax Act, 1967 and tax-exempt income to frank the payment of dividendsout of its entire retained profits without incurring additional tax liabilities.

At the end of the reporting period, the Company has not elected for the single tier tax system. When the tax creditbalance is fully utilised, or by 31 December 2013 at the latest, the Company will automatically move to the singletier tax system. Under the single tier tax system, tax on the Company’s profits is a final tax, and dividends distributedto the shareholders will be exempted from tax.

21. GUARANTEED REDEEMABLE CONVERTIBLE EXCHANGEABLE BONDS (“GCEB”)

On 27 November 2008, the Company issued RM50,000,000 of 4-year Guaranteed Convertile Exchangeable Bonds at100% of its nominal value (“GCEB”) to Intel Capital Corporation to part finance the roll-out of wireless broadband network,provision of commercial wireless access services and working capital. The GCEB’s maturity falls on November 2012 andaccordingly have been reclassified from non-current liabilities to current liabilities during the financial year.




21. GUARANTEED REDEEMABLE CONVERTIBLE EXCHANGEABLE BONDS (“GCEB”) (CONT’D)

The salient terms of the GCEB are as follows:-

(a) Guarantee - The full and timely performance of the Company’s obligations under the GCEB shall be guaranteed byan indirect subsidiary, PONSB.

(b) Coupon rate - The GCEB shall bear a coupon rate of 4.5% per annum payable semi-annually in arrears on thenominal value outstanding.

(c) Redeemability - At the Maturity Date, all outstanding GCEB are redeemable for cash at their nominal value.

(d) Conversion Rights - the GCEB and any accrued interest on the GCEB are convertible into fully paid new shares ofthe Company at the Conversion Price during the conversion period.

(e) Conversion Price - RM2.80 per share of the Company, subject to adjustments in accordance with the provisions ofthe Trust Deed.

(f) Conversion Mode - The GCEB can be converted into the shares of the Company at the election of the Subscriberby surrendering for cancellation of either:-

(i) the GCEB with an aggregate nominal value equivalent to the Conversion Price; or

(ii) an aggregate nominal value of GCEB and any accrued interest on the GCEB equivalent to the ConversionPrice.

(g) Conversion Period - Period starting on the first anniversary of the Issue Date up to the close of business on the 7th

day prior to the Maturity Date of the GCEB or if such GCEB have been called for redemption or exchange beforethe Maturity Date, then up to the close of business on a date no later than seven business days prior to the datefixed for redemption thereof or prior to the date the exchange notice is delivered to the Company.

(h) Exchange Rights - Each registered holder of the GCEB shall have the right exercisable at its discretion at any timeand from time to time during the Exchange Period to exchange such amount of GCEB held or including any accruedinterest on the GCEB up to and including the date of exchange into Class B Irredeemable Convertible PreferenceShares or Packet One Shares or SPV Shares (“Relevant Exchange Shares”) at the Exchange Price.

(i) Exchange Price - RM250 per Relevant Exchange Share, subject to adjustments in accordance with the provisionsof the Trust Deed.

(j) Exchange Mode - The GCEB can be exchanged for Relevant Exchange Share by surrendering for cancellation ofeither:-

(i) The GCEB with an aggregate nominal value equivalent to the Exchange Price; or

(ii) An aggregate nominal value of GCEB and any accrued interest on the GCEB equivalent to the ExchangePrice.

(k) Exchange Period - At any time on and after the Issue Date up to the close of business (at the place where therelevant Bond is deposited for exchange) on the Maturity Date or if such Bond shall have been called for redemptionor conversion before the Maturity Date then up to the close of business (at the place aforesaid) on a date no laterthan 5 Business Days (at the place aforesaid) prior to the date fixed for redemption thereof or prior to the date theConversion Notice is delivered to the Issuer (the “Exchange Period”).




21. GUARANTEED REDEEMABLE CONVERTIBLE EXCHANGEABLE BONDS (“GCEB”) (CONT’D)

The salient terms of the GCEB are as follows:- (cont’d)

(l) Preemptive Rights - prior to any sale, transfer or other disposition by the Issuer to a third party (the “ProposedTransferee”) pursuant to a transfer permitted in these Conditions of all or any of the Packet One Ordinary Shares orClass B Irredeemable Convertible Preference Shares or other preference shares of PONSB beneficially ownedwhether directly or indirectly by the Issuer, the Issuer will procure that each Bondholder has the right for up to 14days to:

(i) purchase a pro-rata number of such shares as described above on the same terms as those offered to or bythe Proposed Transferee; or

(ii) to sell a pro-rata number of the Relevant Exchange Shares held by the Bondholder on the same terms asthose offered by the Proposed Transferee provided that such right to purchase or the closing date of aQualified IPO of PONSB, whichever is earlier.

Interest expense on the GCEB is calculated on the effective yield basis by applying the coupon interest rate of4.5% per annum for an equivalent non-convertible bond to the liability component of the GCEB.

22. HIRE PURCHASE PAYABLES


RM’000 RM’000 RM’000 RM’000

Minimum hire purchase payments:- not later than one year 3,203 6,274 300 343- later than one year and not later than five years 527 2,483 116 417- later than five years - 21 - -

3,730 8,778 416 760Less: Future finance charge (390) (771) (56) (102)

Present value of hire purchase payables 3,340 8,007 360 658

The net hire purchase payables are repayable as follows:-

Current:- not later than one year 2,888 5,790 281 298

Non-current:- later than one year and not later than five years 452 2,200 79 360- later than five years - 17 - -

452 2,217 79 360

3,340 8,007 360 658

The hire purchase payables of the Group and of the Company bore effective interest rates ranging from 3.65% to 5.29%(2010 – 1.93% to 6.50%) per annum at the end of the reporting period.




23. BORROWINGS


2011 2010 2011 2010RM’000 RM’000 RM’000 RM’000

Amanah Term Financing-i (“Amanah Facility”) 9,982 12,768 9,982 12,768Structured Commodity Financing-i Term Facility (“i Term Facility”) 19,084 29,759 - -Syndicated Murabaha Facility (“Murabaha Facility”) 49,553 70,329 - -Revolving Credits 4,500 4,500 - -Amanah Trade Bills 23,034 12,656 23,034 12,656Murabaha Project Facility (“Project Facillity”) 36,000 43,694 - -Irredeemable Convertible Preference Shares (“ICPS”) 150,276 133,143 - -

292,429 306,849 33,016 25,424

Current portion:- repayable within one year 92,314 60,806 25,864 15,442

Non-current portion:- repayable between one and two years 45,722 63,958 2,975 2,786- repayable between two and five years 4,117 48,942 4,177 7,196- repayable after five years 150,276 133,143 - -

Total non-current portion 200,115 246,043 7,152 9,982

292,429 306,849 33,016 25,424

Amanah Facility

The Amanah Facility is repayable in 84 monthly instalments of RM275,611 effective from 4 August 2008.

The Amanah Facility bore an effective interest rate of 5% (2010: 5%) per annum at the end of the reporting period and issecured by:-

(i) a third party first legal charge over a subsidiary’s leasehold land and building;(ii) Al Bai Inah Asset Purchase Agreement; and(iii) Al Bai Inah Asset Sale Agreement.




23. BORROWINGS (CONT’D)

I Term Facility & Murabaha Facility

The Structured Commodity Financing-i Term Facility was obtained from a local financial institution. The SyndicatedMurabaha Facility is obtained from a group of banks and financial institutions arranged by a foreign bank.

The above i Term Facility and Murabaha Facility were granted to a subsidiary and bore effective interest rates rangingfrom 1.84% to 6.25% (2010: 1.66% to 6.25%) per annum and are secured by a corporate guarantee from the Companyand will be fully repaid in 2013.

Project Facility

The Project Facility was granted to a subsidiary and bore an effective interest rate of 7% (2010: 7%) per annum at theend of the reporting period and is secured by a corporate guarantee from the Company and is to be fully repaid within48 months by November 2013.

Amanah Trade Bills

The Amanah Trade Bills bore an effective interest rate of 8.10% (2010: 6.61%) per annum and are repayable over a periodof 90 to 120 days.

Revolving Credits

The Revolving Credits were granted to a subsidiary and bore an effective interest rate of 5.14% (2010: 4.54%) per annumand are secured by a corporate guarantee of the Company and are renewable on a quarterly basis.

Irredeemable Convertible Preference Shares

The principal terms of the Class C ICPS shall carry a fixed cumulative dividend amounting to 4.75% per annum, of theOriginal Acquisition Price (adjusted for share splits, stock dividends, combinations and other similar recapitalisationsaffecting such shares) for Class C ICPS, payable semi-annually in arrears provided that (a) any such dividends shall onlybe payable subject to the availability of distributable profits and (b) where any dividend or part thereof is not payable insuch circumstances, such dividend or part thereof shall not be regarded as being in arrears for the purpose of theentitlement to exercise any voting rights under the Class C ICPS. Accordingly, the Class C ICPS is classified as compoundinstruments, of which the liability portion and its dividend are reflected as financial liability.

24. DEFERRED TAXATION


2011 2010 2011 2010RM’000 RM’000 RM’000 RM’000

At 1 January 49,635 2,499 24 -Transfer (from)/to profit or loss (Note 31) (528) 455 (12) 24Initial recognition of equity component of compoundfinancial instruments 8,569 46,681 - -

At 31 December 57,676 49,635 12 24




24. DEFERRED TAXATION (CONT’D)

The deferred tax liabilities relate to the following items:-


RM’000 RM’000 RM’000 RM’000

Accelerated capital allowances 2,426 2,954 12 24Initial recognition of equity component 55,250 46,681 - -

57,676 49,635 12 24

No deferred tax assets are recognised on the following items:-

The Group2011 2010

RM’000 RM’000

Unutilised tax losses 462,730 320,710Unabsorbed capital allowances 101,485 60,730

564,215 381,440

No deferred tax assets are recognised in respect of this item as it is not probable that taxable profits of the subsidiarieswill be available against which the deductible temporary differences can be utilised.

25. TRADE PAYABLES

The normal trade credit terms granted to the Group and the Company range from 30 to 90 days.

26. OTHER PAYABLES AND ACCRUALS


RM’000 RM’000 RM’000 RM’000

Current portion:- repayable within one year 223,075 133,240 9,766 10,025

Non-current portion:- repayable between one and two years 89,082 46,112 - -

Total non-current portion 89,082 46,112 - -

312,157 179,352 9,766 10,025

The other payables include an amount of approximately RM171.4 million (2010: RM91 million) owing to a supplier for the design,survey, supply, installation, testing, commissioning, integrating and optimising of a subsidiary’s WiMAX Networks which arepayable over a period of 3 years from the time of delivery of the equipment.




27. AMOUNT OWING TO A RELATED PARTY

The amount is non-trade in nature, unsecured, interest-fee and repayable on demand. The amount owing is to be settled incash.

28. NET ASSETS PER SHARE

The net assets per share is calculated based on the net assets value at the end of the reporting period of RM172,876,000 (2010:RM254,971,000) divided by the number of ordinary shares in issue at the end of the reporting period of 653,045,589 (2010:653,045,589) excluding treasury shares held by the Company.

29. REVENUE

Revenue of the Group and of the Company represent the invoiced value of goods sold and services rendered less discountsand returns.


RM’000 RM’000 RM’000 RM’000

Solution group 169,833 107,372 214,678 124,451Broadband services 292,865 208,281 - -Communication services 75,828 78,315 - -

538,526 393,968 214,678 124,451

30. (LOSS)/PROFIT BEFORE TAXATION


RM’000 RM’000 RM’000 RM’000

(Loss)/Profit before taxation is arrived at after charging/(crediting):-

Amortisation on:- development costs 5,407 5,429 3,261 2,712- intellectual property 2,280 2,280 2,280 2,280- modems 57,343 28,838 - -Impairment loss on: - trade receivables 17,689 6,039 - 4,196- other receivables - 1,304 - 1,304- amount owing by a subsidiary - - - 3,192- investments in associates - 878 - 20,108- other investments - 9,128 - 9,128- goodwill 5,807 4,330 - -- investments in subsidiaries - - 4,800 11,235




30. (LOSS)/PROFIT BEFORE TAXATION (CONT’D)


RM’000 RM’000 RM’000 RM’000

Audit fee:- for the current financial year 481 323 65 75- underprovision in the previous financial year 42 92 - 20Bad debts written off - 1,130 - 1,130Depreciation of property, plant and equipment 67,638 51,219 1,718 1,977Development costs written off 6,542 14,931 6,491 3,424Directors’ remuneration 1,356 933 1,356 933Directors’ fee 284 236 248 236Equipment written off 716 14 424 14Interest expense:- hire purchase 117 112 45 44- loans 10,302 6,181 5,057 4,858- GCEB 2,301 2,908 2,301 2,472- Class C ICPS-i 13,905 5,325 - -- other payables 5,739 1,494 - -Inventories written down 9,292 8,939 2,137 996Internet protocol lease rental 15,255 12,513 - -Modems written off 1,395 - - -Rental of office 6,612 5,335 1,127 1,136Rental of equipment 2,977 2,590 - 14Rental of motor vehicle 32 51 - -Share options granted under ESOS 3,299 3,289 2,559 3,289Staff costs 74,260 65,519 20,089 15,850Loss on disposal of property, plant and equipment 2 21 - -Loss/(Gain) on foreign exchange: - realised 332 (3,658) 76 (516)- unrealised 1,400 (14,484) (5,031) 6,115Interest income (663) (510) (6,027) (8,598)Dividend income from an associate (733) - (733) -Gain on disposal of subsidiary/business (283) - - -




31. INCOME TAX EXPENSE


RM’000 RM’000 RM’000 RM’000

Income tax- for the financial year 228 1,016 - 1,700- (over)/underprovision in the previous financial year 215 (1,779) (96) (1,650)

443 (763) (96) 50Deferred taxation (Note 24) (528) 455 (12) 24

(85) (308) (108) 74

The current taxation of the Company is in respect of interest income. The Company is not subject to tax as it has been grantedthe MSC Malaysia status, which qualifies the Company for the Pioneer Status incentive under the Promotion of Investments Act,1986. The Company will enjoy full exemption from income tax on its statutory income from pioneer activities for five years, from10 June 2008 to 9 June 2013.

The statutory tax rate for the current financial year is 25%.

A reconciliation of income tax expense applicable to the (loss)/profit before taxation at the statutory tax rate to income taxexpense at the effective tax rate of the Group and of the Company is as follows:-


RM’000 RM’000 RM’000 RM’000

(Loss)/Profit before taxation (177,781) (225,871) 21,075 (55,247)

Tax at the statutory tax rate of 25% (44,445) (56,468) 5,269 (13,812)

Tax effects of:-Non-taxable income (7,003) (31) (5,269) -Non-deductible expenses 5,466 15,117 - 13,886Deferred tax assets not recognised in the current financial year 45,694 43,336 - -Utilisation of deferred tax assets not recognised in theprevious financial year - (485) - -Differential in tax rates - 13 - -Under/(Over)provision in the previous financial year 203 (1,790) (108) -

(85) (308) (108) 74




32. LOSS PER SHARE

The basic loss per share is arrived at by dividing the Group’s loss attributable to shareholders of RM85,725,000 (2010:RM143,397,000) by the following weighted average number of ordinary shares in issue during the financial year excludingtreasury shares held by the Company.

The Group2011 2010’000 ’000

Issued ordinary shares at 1 January 653,045 652,596Effect of ESOS - 317

653,045 652,913

The diluted loss per share was not presented as there is an anti-dilutive effect arising from the assumed conversion of employees’share option and warrants.

33. DISPOSAL OF SUBSIDIARY/BUSINESS

In the current financial year, the Company disposed of the following subsidiary/business:-

(a) One Vois Sdn. Bhd.; and(b) Communication service business of a subsidiary.

The fair values of the identifiable assets and liabilities of the subsidiary/business as at the date of disposal were:-

The Group2011 2010

RM’000 RM’000

Current assets 1,175 -Current liabilities (62) -

Fair value of net assets acquired 1,113 -Gain on disposal 283 -

Total disposal consideration 1,396 -Amount owing by purchaser (65) -

Net cash inflow on disposal of subsidiary/business 1,331 -

The effects of the disposal of the subsidiary/business on the financial results of the Group at the end of the current financialyear were as follows:-

The Group2011 2010

RM’000 RM’000

Revenue 9,632 -Loss after taxation 827 -




34. PURCHASE OF PROPERTY, PLANT AND EQUIPMENT (CONT’D)


RM’000 RM’000 RM’000 RM’000

Cost of property, plant and equipment purchased 183,428 82,507 898 591Amount financed through hire purchase - (1,468) - (342)

Cash disbursed for purchase of property, plant and equipment 183,428 81,039 898 249

35. CASH AND CASH EQUIVALENTS

For the purpose of the statements of cash flows, cash and cash equivalents comprise the following:-


RM’000 RM’000 RM’000 RM’000

Deposits with licensed banks (Note 16) 1,191 72,368 1,191 1,159Cash and bank balances (Note 17) 84,085 98,452 71,533 82,967

85,276 170,820 72,724 84,126

36. DIRECTORS’ REMUNERATION

The aggregate amount of emoluments received and receivable by Directors of the Group and of the Company during thefinancial year are as follows:-


RM’000 RM’000 RM’000 RM’000

Executive directors:- basic salaries, Employees Provident Fund and bonus 1,326 908 1,326 908

Non-executive directors:- allowance 30 25 30 25- fee 284 236 248 236

1,640 1,169 1,604 1,169




36. DIRECTORS’ REMUNERATION (CONT’D)

Details of emoluments for the directors of the Group and of the Company received/receivable for the financial year inbands of RM50,000 are as follows:-


Executive directors:RM700,001 – RM750,000 1 - 1 -RM600,001 – RM650,000 - 1 - 1RM550,001 – RM600,000 1 - 1 -RM250,001 – RM300,000 - 1 - 1

Non-executive directors:Above RM50,000 3 2 2 2Below RM50,000 3 4 4 4

8 8 8 8

No emoluments were paid to the alternate director holding office during the financial year.

37. SIGNIFICANT RELATED PARTY DISCLOSURES

(a) Identities of related parties

The Group has related party relationships with its directors, key management personnel and entities within the samegroup of companies.

(b) In addition to the information detailed elsewhere in the financial statements, the Group and the Company carriedout the following significant transactions with the related parties during the financial year:-


RM’000 RM’000

Sales to subsidiaries:- GPNWLL 6,422 4,027- PONSB 52,038 26,716- GPA 5,365 6,946- GPUS 1,908 -

Loans/Advances from/(to) subsidiaries:- NGT - (76)- WESB - (2,313)- Inova - (358)- POI (18) -

Interest received/receivable from subsidiaries:- PONSB 3,498 6,042- NGT 74 76- WESB 2,277 2,313- Inova 118 94

Subscription of IICPS in a subsidiary:- PONSB 151,124 39,687




37. SIGNIFICANT RELATED PARTY DISCLOSURES (CONT’D)

(b) In addition to the information detailed elsewhere in the financial statements, the Group and the Company carriedout the following significant transactions with the related parties during the financial year:- (cont’d)


Note RM’000 RM’000 RM’000 RM’000

Loans from/(to) associate :- GMO Global Limited - (20) - (20)

Key management personnel compensation- short-term employee benefits 3,391 2,893 2,045 1,645- share-based payment 982 823 773 625

38. OPERATING SEGMENTS

Operating segments are prepared in a manner consistent with the internal reporting provided to the management as itschief operating decision maker in order to allocate resources to segments and to assess their performance. Formanagement purposes, the Group is organised into business units based on their products and services provided.

The Group is organised into 3 main business segments as follows:-

(i) Solution group - Research, development, marketing and distribution of wireless networking and telecommunicationsproducts and solutions.

(ii) Broadband services - Provision of broadband networks infrastructure, facilities and services.

(iii) Communications services - Provision of total communication services, solutions and products.

The management assesses the performance of the operating segments based on operating profit or loss which ismeasured differently from those disclosed in the consolidated financial statements.

Group financing (including finance costs) and income taxes are managed on a group basis and are not allocated tooperating segments.




a38. OPERATING SEGMENTS (CONT’D)

BUSINESS SEGMENTS

Solution Broadband Communication GroupGroup Services Services

RM’000 RM’000 RM’000 RM’0002011

RevenueExternal revenue 169,833 292,865 75,828 538,526Inter-segment revenue 52,041 - - 52,041

221,874 292,865 75,828 590,567

Adjustments and eliminations (52,041)

Consolidated revenue 538,526

ResultsSegment results 42,887 (15,805) 4,248 31,330Interest income 36 604 23 663Depreciation of property, plant and equipment (6,641) (60,435) (562) (67,638)Other non-cash expenses (23,699) (83,874) (2,199) (109,772)

12,583 (159,510) 1,510 (145,417)

Finance costs (32,364)Income tax expense 85

Consolidated loss after taxation (177,696)

AssetsSegment assets 183,028 779,202 23,060 985,290

Investment in an associate -

Consolidated total assets 985,290

LiabilitiesSegment liabilities (144,445) (594,793) (19,769) (759,007)

Deferred taxation (57,676)

Consolidated total liabilities (816,683)




38. OPERATING SEGMENTS (CONT’D)

BUSINESS SEGMENTS (cont’d)

Solution Broadband Communication GroupGroup Services Services

RM’000 RM’000 RM’000 RM’0002010

RevenueExternal revenue 107,372 208,281 78,315 393,968Inter-segment revenue 46,760 - - 46,760

154,132 208,281 78,315 440,728

Adjustments and eliminations (46,760)

Consolidated revenue 393,968

ResultsSegment results 11,705 (64,052) 2,376 (49,971)Interest income 73 437 - 510Depreciation of property, plant and equipment (2,024) (48,700) (495) (51,219)Other non-cash expenses (25,173) (61,377) - (86,550)

(15,419) (173,692) 1,881 (187,230)

Finance costs (16,020)Share of results in associates (17,907)Unallocated expenses (4,714)Income tax expense 308

Consolidated loss after taxation (225,563)

Restated

2010

AssetsSegment assets 189,346 718,628 44,135 952,109

Investment in an associate -

Consolidated total assets 952,109

LiabilitiesSegment liabilities (52,239) (513,285) (18,447) (583,971)

Deferred taxation (49,635)

Consolidated total liabilities (633,606)




38. OPERATING SEGMENTS (CONT’D)

BUSINESS SEGMENTS (cont’d)

Other non-cash expenses consist of the following:-

The Group2011 2010

RM’000 RM’000

Amortisation of:-- Development costs 5,407 5,429- Intellectual property 2,280 2,280- Modems 57,343 28,838Development costs written off 6,542 14,931Impairment loss of other investments - 9,128Impairment loss on goodwill 5,807 4,330Impairment loss on investments in associates - 878Impairment loss on receivables 17,689 7,343Bad debts written off - 1,130Modems written off 1,395 -Inventories written off 9,292 8,939Share options to employees 3,299 3,289Loss on disposal of property, plant and equipment 2 21Equipment written off 716 14

109,772 86,550

GEOGRAPHICAL INFORMATION

Non-CurrentRevenue Assets

2011 2010 2011 2010RM’000 RM’000 RM’000 RM’000

Malaysia 302,498 309,381 690,696 617,223Outside Malaysia 236,028 84,587 45,209 20,653

538,526 393,968 735,905 637,876

MAJOR CUSTOMERS

The following are major external customers with revenue equal to or more than 10% of Group revenue:-

Revenue Contribution Segment

2011 2010% %

Top 5 external customers 35% 19% Solution groupTop 5 external customers 50% 40% Communication services

For broadband services, its customers are retail in nature, hence its customers profile is voluminous and each of them issmall compared to the segment revenue.




39. CAPITAL COMMITMENTS


RM’000 RM’000 RM’000 RM’000

Approved and contracted for:- Plant and equipment 151,140 123,949 2 71- Inventories 29,042 79,073 29,042 79,073

Approved but not contracted for:- Plant and equipment 126,930 66,959 - -

40. OPERATING LEASE COMMITMENTS

The future minimum lease payments under the non-cancellable operating leases are as follows:-


RM’000 RM’000 RM’000 RM’000

Not later than one year 15,240 29,885 107 117Later than one year and not later than five years 25,399 21,016 4 111

40,639 50,901 111 228

41. CONTINGENT LIABILITIES

(a) Corporate Guarantees


RM’000 RM’000

Given to secure banking facilities granted to a wholly-owned subsidiary, GPLL 119,700 119,700

Given to ZTE Corporation on payment under the Supply Contract by a 55%owned subsidiary, PONSB 131,000 131,000

Given to IBM (Malaysia) Sdn. Bhd. for Leasing Facility grantedto PONSB. 14,000 14,000

(b) PONSB, a 55% owned subsidiary of the Company has provided guarantees amounting to RM7,700,000 to theMalaysian Communications and Multimedia Commission ("MCMC") for the due performance of a "2.3GHz BroadbandWireless Access Spectrum Tender" by PONSB for all the terms and conditions of the apparatus assignment issuedby MCMC.

42. FINANCIAL INSTRUMENTS

The Group’s activities are exposed to a variety of market risks (including foreign currency risk, interest rate risk and equityprice risk), credit risk and liquidity risk. The Group’s overall financial risk management policy focuses on theunpredictability of financial markets and seeks to minimise potential adverse effects on the Group’s financial performance.




42. FINANCIAL INSTRUMENTS (CONT’D)

(a) Financial Risk Management Policies

The Group’s policies in respect of the major areas of treasury activity are as follows:-

(i) Market Risk

(i) Foreign Currency Risk

The Group is exposed to foreign currency risk on transactions and balances that are denominated incurrencies other than Ringgit Malaysia and Chinese Renminbi. The currencies giving rise to this risk areprimarily United States Dollar. Foreign currency risk is monitored closely on an ongoing basis to ensurethat the net exposure is at an acceptable level. On occasion, the Group enters into forward foreigncurrency contracts to hedge against its foreign currency risk.

The Group’s exposure to foreign currency is as follows:-

United States Ringgit Chinese Dollar Malaysia Renminbi Others Total

The Group RM’000 RM’000 RM’000 RM’000 RM’000

2011

Financial assets

Other investments - 135 - - 135Trade receivables 50,593 20,322 227 153 71,295Other receivables and deposits 4,238 53,107 82 3,855 61,282Deposits with licensed banks - 1,191 - - 1,191Cash and bank balances 7,144 8,289 67,969 683 84,085

61,975 83,044 68,278 4,691 217,988

Financial liabilities

GCEB - 50,000 - - 50,000Hire purchase payables - 3,340 - - 3,340Borrowings 68,637 223,792 - - 292,429Trade payables 40,918 35,913 223 21,449 98,503Other payables and accruals 124,679 178,610 561 8,307 312,157Amount owing to a related party - 2,578 - - 2,578

234,234 494,233 784 29,756 759,007

Net financial assets/(liabilities) (172,259) (411,189) 67,494 (25,065) (541,019)Less: Net financial (assets)/

liabilities denominated inthe respective entities’functional currencies - 411,189 - - 411,189

Currency exposure (172,259) - 67,494 (25,065) (129,830)





(a) Financial Risk Management Policies (cont’d)

(i) Market Risk (cont’d)

(i) Foreign Currency Risk (cont’d)

United States Ringgit Chinese Dollar Malaysia Renminbi Others Total

The Group RM’000 RM’000 RM’000 RM’000 RM’000

2010

Financial assets

Other investments - 135 - - 135Trade receivables 24,160 35,977 65 311 60,513Other receivables and deposits 1,905 26,172 104 4,459 32,640Deposits with licensed banks 1,159 71,209 - - 72,368Cash and bank balances 5,212 12,598 80,642 - 98,452

32,436 146,091 80,811 4,770 264,108

Financial liabilities

GCEB - 50,000 - - 50,000Hire purchase payables - 8,007 - - 8,007Borrowings 100,088 206,761 - - 306,849Trade payables 22,007 17,381 223 152 39,763Other payables and accruals 90,296 84,079 565 4,412 179,352

212,391 366,228 788 4,564 583,971

Net financial assets/(liabilities) (179,955) (220,137) 80,023 206 (319,863)Less: Net financial (assets)/

liabilities denominated inthe respective entities’functional currencies - 220,137 113 - 220,250

Currency exposure (179,955) - 80,136 206 (99,613)








UnitedStates Ringgit ChineseDollar Malaysia Renminbi Others Total

The Company RM’000 RM’000 RM’000 RM’000 RM’000

2011

Financial assetsOther Investments - 635,614 - - 635,614Trade receivables 24,392 3,988 - 2,131 30,511Other receivables and deposits - 6,222 - - 6,222Deposits with licensed banks - 1,191 - - 1,191Amount owing by subsidiaries - 104,919 - - 104,919Cash and bank balances 1,241 2,323 67,969 - 71,533

25,633 754,257 67,969 2,131 849,990

Financial liabilitiesGCEB - 50,000 - - 50,000Hire purchase payables - 360 - - 360Borrowings - 33,016 - - 33,016Other payables and accruals - 9,766 - - 9,766Trade payables 47,109 2,520 - - 49,629Amount owing to subsidiaries - 113,943 - - 113,943Amount owing to related party 2,578 - - - 2,578

49,687 209,605 - - 259,292

Net financial assets/ (liabilities) (24,054) 544,652 67,969 2,131 590,698Less: Net financial (assets)/

liabilities denominated in the entity’s functional currency - (544,652) - - (544,652)

Currency exposure (24,054) - 67,969 2,131 46,046








UnitedStates Ringgit ChineseDollar Malaysia Renminbi Total

The Company RM’000 RM’000 RM’000 RM’000

2010

Financial assetsOther Investments - 425,150 - 425,150Trade receivables 10,871 1,300 - 12,171Other receivables and deposits - 634 - 634Deposits with licensed banks - 1,159 - 1,159Amount owing by subsidiaries - 70,667 - 70,667Cash and bank balances 30 2,801 80,136 82,967

10,901 501,711 80,136 592,748

Financial liabilitiesGCEB - 50,000 - 50,000Hire purchase payables - 658 - 658Borrowings - 25,424 - 25,424Other payables and accruals - 10,025 - 10,025Trade payables 17,620 1,270 - 18,890Amount owing to subsidiary - 140,203 - 140,203

17,620 227,580 - 245,200

Net financial assets/(liabilities) (6,719) 274,131 80,136 347,548Less: Net financial

(assets)/liabilitiesdenominated in the entity’sfunctional currency - (274,131) - (274,131)

Currency exposure (6,719) - 80,136 73,417








Foreign currency risk sensitivity analysis

The following table details the sensitivity analysis to a reasonably possible change in the foreigncurrencies as at the end of the reporting period, with all other variables held constant:-


Increase/ Increase/ Increase/ Increase/(Decrease) (Decrease) (Decrease) (Decrease)

RM’000 RM’000 RM’000 RM’000

Effects on profit after taxation/Equity

United States Dollar:-- strengthened by 5% (6,460) (8,998) (902) (336)- weakened by 5% 6,460 8,998 902 336

Chinese Renminbi:-- strengthened by 5% 2,531 4,007 2,549 4,007- weakened by 5% (2,531) (4,007) (2,549) (4,007)

Others:-- strengthened by 5% 940 - 80 -- weakened by 5% (940) - (80) -

(ii) Interest Rate Risk

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

Information relating to the Group’s exposure to the interest rate risk of the financial liabilities is disclosed inNote 42(a)(iii) to the financial statements.







(ii) Interest Rate Risk (cont’d)

Interest rate risk sensitivity analysis

The following table details the sensitivity analysis to a reasonably possible change in the interest ratesas at the end of the reporting period, with all other variables held constant:-


Increase/ Increase/ Increase/ Increase/(Decrease) (Decrease) (Decrease) (Decrease)

RM’000 RM’000 RM’000 RM’000

Effects on profit after taxation/EquityIncrease by 1% per annum (“p.a.”) (712) (1,173) (164) (127)

Decrease 1% p.a. 712 1,173 164 127

(iii) Equity Price Risk

The Group’s does not have any exposure to equity price risk arising mainly from changes in quotedinvestment prices as it does not hold any quoted investments.

(ii) Credit Risk

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

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

Credit risk concentration profile

The Group’s does not have major concentration of credit risk relating to any major single customer in its poolof customers as at the end of the reporting period.

Exposure to credit risk

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






(ii) Credit Risk (cont’d)

Exposure to credit risk (cont’d)

The exposure of credit risk for trade receivables by geographical region is as follows:-


RM’000 RM’000 RM’000 RM’000

In Malaysia 40,484 40,555 3,988 36Outside Malaysia 30,811 19,958 26,523 12,135

71,295 60,513 30,511 12,171

Ageing analysis

The ageing analysis of the Group’s trade receivables as at 31 December 2011 is as follows:-

Gross Individual Collective CarryingAmount Impairment Impairment Value

The Group RM’000 RM’000 RM’000 RM’000

2011

Not past due 25,246 - - 25,246Past due:-- less than 3 months 22,732 - - 22,732- 3 to 6 months 13,992 - - 13,992- over 6 months 24,164 - (14,839) 9,325

86,134 - (14,839) 71,2952010

Not past due 58,700 - - 58,700Past due:-- less than 3 months 2,422 (609) - 1,813- 3 to 6 months 1,685 (1,685) - -- over 6 months 4,875 (4,875) - -

67,682 (7,169) - 60,513






(ii) Credit Risk (cont’d)

Ageing analysis (cont’d)

At the end of the reporting period, trade receivables that are individually impaired were those in significantfinancial difficulties and have defaulted on payments. These receivables are not secured by any collateral orcredit enhancement.

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

Trade receivables that are past due but not impaired

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

Trade receivables that are neither past due nor impaired

A significant portion of trade receivables that are neither past due nor impaired are regular customers thathave been transacting with the Group. The Groups uses ageing analysis to monitor the credit quality of thetrade receivables. Any receivables having significant balances past due or more than 60 days, which aredeemed to have higher credit risk, are monitored individually.

(iii) Liquidity Risk

Liquidity risk arises mainly from general funding and business activities. The Group practises prudent riskmanagement by maintaining sufficient cash balances and the availability of funding through certain committedcredit facilities.

The following table sets out the maturity profile of the financial liabilities as at the end of the reporting periodbased on contractual undiscounted cash flows (including interest payments computed using contractual ratesor, if floating, based on the rates at the end of the reporting period):-

WeightedAverage Contractual OverEffective Carrying Undiscounted Within 1 – 5 5

Rate Amount Cash Flows 1 Year Years YearsThe Group % RM’000 RM’000 RM’000 RM’000 RM’0002011

GCEB 4.75% 50,000 54,500 54,500 - -Hire purchase payables 3.83% 3,340 3,730 3,203 527 -Borrowings 5.00% 292,429 475,756 96,930 62,213 316,613Trade payables - 98,503 98,503 98,503 - -Other payables and accruals - 312,157 318,943 229,861 89,082 -

Amount owing toa related party - 2,578 2,578 2,578 - -

759,007 954,010 485,575 151,822 316,613






(iii) Liquidity Risk (cont’d)

WeightedAverage Contractual OverEffective Carrying Undiscounted Within 1 – 5 5

Rate Amount Cash Flows 1 Year Years YearsThe Group % RM’000 RM’000 RM’000 RM’000 RM’0002010

GCEB 4.75% 50,000 54,500 2,250 52,250 -Hire purchase payables 4.22% 8,007 8,778 6,274 2,483 21Borrowings 5.00% 306,849 474,993 69,526 124,285 281,182Trade payables - 39,763 39,763 39,763 - -Other payablesand accruals - 179,352 185,947 152,253 33,694 -

583,971 763,981 270,066 212,712 281,203

The Company2011

GCEB 4.75% 50,000 54,500 54,500 - -Hire purchasepayables 4.22% 360 416 300 116 -

Bank borrowings 5.00% 33,016 34,885 26,341 3,307 5,237Trade payables - 49,629 49,629 49,629 - -Other payables - 9,766 9,766 9,766 - -Amount owing tosubsidiaries - 113,943 113,943 113,943 - -

Amount owing to arelated party - 2,578 2,578 2,578 - -

259,292 265,717 257,057 3,423 5,237

The Company2011

GCEB 4.75% 50,000 54,500 2,250 52,250 -Hire purchase payables 4.22% 658 760 343 417 -Bank borrowings 5.00% 25,424 29,285 17,017 12,268 -Trade payables - 18,890 18,890 18,890 - -Other payables - 10,025 10,025 10,025 - -Amount owing to subsidiaries - 140,203 140,203 140,203 - -

245,200 253,663 188,728 64,935 -





(b) Capital Risk Management

The Group manages its capital to ensure that entities within the Group will be able to maintain an optimal capitalstructure so as to support their businesses and maximise shareholders value. To achieve this objective, the Groupmay make adjustments to the capital structure in view of changes in economic conditions, such as adjusting theamount of dividend payment, returning of capital to shareholders or issuing new shares.

The Group manages its capital based on debt-to-equity ratio. The Group’s strategies were unchanged from theprevious financial year. The debt-to-equity ratio is calculated as net debt divided by total equity. Net debt iscalculated as total interest bearing bank borrowings less cash and cash equivalents.

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

The Group2011 2010

RM’000 RM’000

GCEB 50,000 50,000Hire purchase payables 3,340 8,007Bank borrowings 142,153 173,706

195,493 231,713Less: Deposits with licensed banks 1,191 72,368Less: Cash and bank balances 84,085 98,452

Net debt 110,217 60,893

Total equity 283,093 315,864

Debt-to-equity ratio 0.39 0.19

Under the requirement of Bursa Malaysia Practice Note No. 17/2005, the Company is required to maintain aconsolidated shareholders’ equity (total equity attributable to owners of the Company) equal to or not less than the25% of the issued and paid-up share capital (excluding treasury shares) and such shareholders’ equity is not lessthan RM40 million. The Company has complied with this requirement.

The Group is also required to maintain a maximum debt to equity ratio of 0.5 to comply with the bank covenant,failing which, the bank may call an event of default. The Group has complied with this requirement





(c) Classification Of Financial Instruments


RM’000 RM’000 RM’000 RM’000

Financial assets

Available-for-sale financial assetsUnquoted investments 135 - 635,614 -

Loans and receivables financial assets Trade receivables 71,295 60,513 30,511 12,171Other receivables and deposits 61,282 32,640 6,222 634Amount owing by subsidiaries - - 104,919 70,667Fixed deposits with licensed banks 1,191 72,368 1,191 1,159Cash and bank balances 84,085 98,452 71,533 82,967

217,853 263,973 214,376 167,598Financial liabilities

Other financial liabilitiesGCEB 50,000 50,000 50,000 50,000Hire purchase payables 3,340 8,007 360 658Borrowings 292,429 306,849 33,016 25,424Trade payables 98,503 39,763 49,629 18,890Other payables and accruals 312,157 179,352 9,766 10,025Amount owing to a subsidiary - - 113,943 140,203Amount owing to a related party 2,578 - 2,578 -

759,007 583,971 259,292 245,200

(d) Fair Values Of Financial Instruments

The carrying amounts of the financial assets and financial liabilities reported in the financial statementsapproximated their fair values.

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

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

(ii) The fair value of GCEB and hire purchase payables is determined by discounting the relevant cash flowsusing current interest rates for similar instruments as at the end of the reporting period.

(iii) The carrying amounts of the bank borrowings approximated their fair values as these instruments bear interestat variable rates.





(e) Fair Value Hierarchy

The fair values of the financial assets and liabilities are analysed into level 1 to 3 as follows:-

Level 1: Fair value measurements derive from quoted prices (unadjusted) in active markets for identical assetsor liabilities.

Level 2: Fair value measurements derive from inputs other than quoted prices included within level 1 that areobservable for the asset or liability, either directly or indirectly.

Level 3: Fair value measurements derive from valuation techniques that include inputs for the asset or liabilitythat are not based on observable market data (unobservable inputs).

The Company’s unquoted shares in IICPS of approximately RM635 million in an indirect subsidiary, PONSB isdesignated as available-for-sale financial assets and is measured at fair value. This financial asset belongs to level2 of the fair value hierarchy.

43. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR

Significant events during the financial year are as follows:-

(a) On 5 May 2011, the Company granted 10,500,000 options to subscribe for new ordinary shares of RM0.20 eachpursuant to the fourth allocation of share options under its Employees’ Share Option Scheme (“ESOS”) to eligibleemployees and directors of the Company and its subsidiaries at an option price of RM0.60.

(b) The Company, PONSB and SK Telekom Co. Ltd (“SKT”) had on 16 May 2011, entered into a conditional sharesubscription agreement:-

(i) for PONSB to issue 153,276 Class C Irredeemable Convertible Preference Shares of RM0.10 each (“Class CICPS-i) in PONSB to SKT for a total cash consideration of RM50.53 million or RM329.68 per Class C ICPS-I;and

(ii) for the Company to subscribe for up to 458,397 Class A ICPS-i for a total subscription price of up toapproximately RM151.12 million or RM329.68 per Class A ICPS-i.

On 7 July 2011, PONSB issued the following:-

(i) 276,026 Class A ICPS-i to the Company arising from the conversion and capitalisation of approximately RM91 million owing by PONSB to the Company; and

(ii) 153,276 Class C ICPS-i to SKT for a total cash consideration of approximately RM50.53 million.

On 6 September 2011, the Company subscribed for 30,708 new Class A ICPS-i in PONSB for a total cashconsideration of approximately RM10.12 million or RM329.68 per Class A ICPS-i.




42. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR (CONT’D)

Significant events during the financial year are as follows:-(cont’d)

(c) On 28 July 2011, NTSB had entered into a Business Sale Agreement with IME Telco (M) Sdn Bhd (“IME Telco”)whereby NTSB had sold its business, pursuant to an Advanced Reseller Agreement dated 31 July 2009 (“ARAgreement”) made between Maxis Broadband Sdn Bhd (“Maxis”) and NTSB, to IME Telco for a purchaseconsideration of RM957,500. NTSB has also agrees to sell and Newflex Communications Sdn Bhd (“Newflex”)agrees to purchase the business and fixed assets of NTSB other than the Maxis business for a total cashconsideration of RM435,088.

(d) GMO Global Limited, an associate of GPB, was dissolved on 30 September 2011. GMO Global Limited wasincorporated in The British Virgin Islands and the Company held 27.9% of the equity interest in GMO Global Limited.

44. SIGNIFICANT EVENTS OCCURRING AFTER THE REPORTING PERIOD

(a) On 13 March 2012, the Group, via a subsidiary, PONSB secured a convertible loan of RM50,000,000 (“the facility”)under the Shariah concept of Murabahah from Malaysia Debt Ventures Berhad (“MDV”). The facility is for a periodof forty eight months from the date of first disbursement inclusive of an estimated six month grace period.

During the tenure of the facility, MDV has the option which is exercisable at its sole discretion, to convert theoutstanding disbursed monies due and payable into the relevant numbers of ordinary shares of a subsidiary, PONSBor Class D Islamic Irredeemable Convertible Preference Shares of RM0.10 each (“Class D ICPS-i”), based on theconversion price of RM362.15 per share upon the terms and conditions agreed. MDV can convert up to 137,873Class D ICPS-i based on the conversion price. The Class D ICPS-i shall, upon allotment and issue, rank pari passuin all respects with the then existing Class A ICPS, Class B ICPS and Class C ICPS respectively in PONSB.

The facility is secured against a debenture incorporating a fixed and floating charge over all the present and futureassets and undertakings of PONSB and a Corporate Guarantee of the Company.

(b) On 27 March 2012, the Company granted 10.0 million share options at an offer price of RM0.56 per new ordinaryshare to all eligible employees and directors of the Company and Group pursuant to the Employees’ Share OptionScheme.

(c) On 19 April 2012, the Company entered into a Share Sale Agreement with Dr. Tan Peng San (a director of asubsidiary of the Company) to disposed of its entire equity interest in Mobiliti One International Pte Ltd (formerlyknown as Packet One International Pte Ltd) for a total cash consideration of S$1.00 (equivalent to approximatelyRM2.45).




45. PRIOR YEAR ADJUSTMENT

Class C ICPS in a subsidiary were classified as compound financial instruments that contained both liability and equitycomponents using a residual valuation of the equity component. The liability component and their related deferred taxliabilities of Class C ICPS were over-recognised in the previous financial year.

Accordingly, adjustments have been made to reduce the liability component and their related deferred tax liabilities witha corresponding increase in the non-controlling interest accounts.

The adjustments had the following effects on the financial statements in the previous financial year:-Group 2010

RM’000

Statements of financial position

Increase in non-controlling interests 19,173Decrease in borrowings (25,564)Increase in deferred taxation 6,391

46. COMPARATIVE FIGURES

The following figures have been reclassified to conform with the prior year adjustment as disclosed in Note 45 to thefinancial statements and the presentation of the current financial year:-

As As Previously

Restated ReportedRM’000 RM’000

Statements of Financial Position (Extract):-

Non-controlling interests 63,352 44,359Borrowings (non-current liabilities) 246,043 271,607Deferred taxation 49,635 43,244

Statements of Cash Flows (Extract):-(Loss)/Profit before taxation (55,247) (52,055)Impairment loss on amount owing by a subsidiary 3,192 -




47. SUPPLEMENTARY INFORMATION – DISCLOSURE OF REALISED AND UNREALISED PROFITS/LOSSES

The breakdown of the retained profits/(accumulated losses) of the Group and of the Company as at the end of thereporting period into realised and unrealised profits/(losses) are presented in accordance with the directive issued byBursa Malaysia Securities Berhad and prepared in accordance with Guidance on Special Matter No. 1, Determination ofRealised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities BerhadListing Requirements, as issued by the Malaysian Institute of Accountants, as follows:-


RM’000 RM’000 RM’000 RM’000

Total (accumulated losses)/retained profits:- realised (567,254) (353,629) 9,556 (469)- unrealised (3,826) 17,438 5,019 (6,139)

(571,080) (336,191) 14,575 (6,608)

Total share of retained profits of associates:- realised - (29,733) - -- unrealised

- - - -

(571,080) (365,924) 14,575 (6,608)Less: Consolidation adjustments

202,252 82,821 - -

At 31 December (368,828) (283,103) 14,575 (6,608)




list ofproperty

Description/ Acquisition Approximate Estimated Net Book Title/Location Existing Use Tenure Date Land Area Age of Value

in sq ft Building RM

HS(D) 171402, 12 ½ storey Leasehold 2 January 126,676 9 years 46,000,000PT No 159, Seksyen 8, purpose built expiring on 2008 gross floorBandar Petaling Jaya, office building 28 May 2068 area and Daerah Petaling Jaya, 100,000Negeri Selangor lettable area



Types of Securities : Ordinary share of RM0.20 each

Authorised Share Capital : RM400,000,000 of 2,000,000,000 ordinary shares of RM0.20 each

Issued and Paid-up Share Capital : RM131,550,657.80 comprising of 657,753,289 ordinary shares of RM0.20 each

Voting Rights : Every member of the Company, present in person or by proxy or attorney or authorisedrepresentative, shall have on a show of hands, one vote or on a poll, one vote for eachshare held

Number of Shareholders : 7,236

Distribution of Shareholdings

Range of No. of % of Total % ofshareholdings shareholders shareholders shareholdings shareholdings#

1- 99 193 2.67 8,554 0.00˜ 100-1,000 760 10.50 593,850 0.091,001-10,000 3,899 53.88 20,839,600 3.1910,001-100,000 2,068 28.58 64,536,768 9.88100,001-32,652,278 310 4.28 138,369,362 21.1932,652,279* and above 6 0.08 428,697,455 65.65

Total 7,236 100.00 653,045,589# 100.00

Notes:

˜ Negligible

* 5% of the issued share capital

# Excludes 4,707,700 ordinary shares held as treasury shares.

LIST OF THIRTY LARGEST REGISTERED SHAREHOLDERS

Name No. of shares Percentage (%)#

1. ECML Nominees (Asing) Sdn Bhd 131,207,771 20.09Pledged Securities Account for Green Packet Holdings Ltd (001)

2. OSK Technology Ventures Sdn Bhd 120,904,275 18.51

3. Cartaban Nominees (Asing) Sdn Bhd 52,599,216 8.05SSBT Fund HG22 For SmallCap World Fund, Inc.

4. MIDF Amanah Investment Nominees (Asing) Sdn Bhd 42,339,194 6.48Pledged Securities Account for Green Packet Holdings Ltd (MGN-GPH001M)

5. PacificQuest 41,315,625 6.33

6. JF Apex Nominees (Asing) Sdn Bhd 40,331,374 6.18Pledged Securities Account for Green Packet Holdings Ltd.

7. Lembaga Tabung Haji 12,708,050 1.95

8. Green Packet Holdings Ltd 10,000,000 1.53

9. Ong Lee Veng @ Ong Chuan Heng 4,100,000 0.63

analysis of

shareholdings as at 7 May 2012



LIST OF THIRTY LARGEST REGISTERED SHAREHOLDERS (CONT’D)

Name No. of shares Percentage (%)#

10. OSK Nominees (Tempatan) Sdn Berhad 3,425,295 0.52Pledged Securities Account for Puan Chan Cheong

11. HSBC Nominees (Asing) Sdn Bhd 3,158,800 0.48AA Noms SG for JX Ltd

12. Citigroup Nominees (Asing) Sdn Bhd 3,055,800 0.47Exempt an for UBS AG Hong Kong (Foreign)

13. HSBC Nominees (Asing) Sdn Bhd 2,758,700 0.42AA Noms SG for YM Ltd

14. HSBC Nominees (Asing) Sdn Bhd 2,666,300 0.41AA Noms SG for YC Ltd

15. HSBC Nominees (Asing) Sdn Bhd 2,488,200 0.38AA Noms SG for YS Ltd 2,437,300 0.37

16. Nora Ee Siong Chee

17. HSBC Nominees (Asing) Sdn Bhd 2,418,000 0.37AA Noms SG for JY Ltd

18. UNIVERSAL Trustee (Malaysia) Berhad 2,000,000 0.31TA Dana Fokus

19. Loh Teck Yen 1,850,000 0.28

20. CIMB Group Nominees (Tempatan) Sdn Bhd 1,500,000 0.23CIMB Commerce Trustee Berhad for TA Dana Optimix

21. CIMSEC Nominees (Tempatan) Sdn Bhd 1,500,000 0.23CIMB for Daywide Enterprise Sdn Bhd (PB)

22. How Beik Tin 1,500,000 0.23

23. HLG Nominee (Tempatan) Sdn Bhd 1,360,000 0.21Hong Leong Bank Bhd for Lim Ooi Wah

24. AMSEC Nominees (Asing) Sdn Bhd 1,261,200 0.19AmFraser Securities Pte Ltd for Lim Choon Bock (206558)

25. Puan Kam Fook 1,183,600 0.18

26. Citigroup Nominees (Asing) Sdn Bhd 1,037,400 0.16CBNY for Dimensional Emerging Markets Value Fund

27. JF Apex Nominees (Asing) Sdn Bhd 1,006,700 0.15Pledged Securities Account for On Chee Seng (Margin)

28. Tan Kin Lee 1,000,050 0.15

29. HSBC Nominees (Asing) Sdn Bhd 946,800 0.14HSBC BK PLC for Aperios Emerging Connectivity Master Fund Limited

30. HDM Nominees (Tempatan) Sdn Bhd 900,000 0.14Phillip Securities Pte Ltd for Lum Ah Ying

analysis of

shareholdings as at 7 May 2012 (cont’d)



According to the Register of Substantial Shareholders required to be kept under Section 69L of the Companies Act, 1965, thefollowing are the substantial shareholders of the Company:

Direct (A) Indirect (B)Shareholders No. of %# No. of %# Total %#

shares shares Interest

Green Packet Holdings Ltd 223,878,339 34.28 - - - -OSK Technology Ventures Sdn Bhd 120,904,275 18.51 - - - -SMALLCAP World Fund, Inc. 52,599,216 8.05 - - - -PacificQuest 41,315,625 6.33 - - - -Puan Chan Cheong 3,425,295 0.52 223,878,339 34.28(1) 227,303,634 34.80Tan Sri Dato’ Kok Onn - - 223,878,339 34.28(1) - -OSK Venture International Berhad - - 120,904,275 18.51(2)

Ong Leong Huat@ Wong Joo Hwa - - 120,904,275 18.51(3) - -Sedco International Holdings Ltd - - 41,315,625 6.33(4) - -AHL Holdings Company Limited - - 41,315,625 6.33(5) - -

According to the register required to be kept under Section 134 of the Companies Act, 1965, the Directors’ Interest in theshares, warrants and options of the Company and its related companies are as follows:

Direct IndirectNo. of %# No. of %#

Directors Shares Shares

Puan Chan Cheong 3,425,295 0.52 223,878,339(1) 34.28Nik Mat Bin Ismail 825,049 0.13 - -Tan Sri Dato’ Kok Onn - - 223,878,339(1) 34.28Boey Tak Kong 676,000 0.10 - -

Direct IndirectNo. of % No. of %

Directors Warrants Warrants

Puan Chan Cheong 1,241,765 0.63 - -Nik Mat Bin Ismail 86,474 0.04 - -

analysis of




Number of options over ordinary shares of RM0.20 eachDirectors No. of option

Tan Sri Datuk Dr Haji Omar Bin Abdul Rahman 222,041Puan Chan Cheong 4,686,550Nik Mat Bin Ismail 906,475Tan Sri Dato’ Kok Onn 247,875Boey Tak Kong 196,207A.Shukor Bin S.A. Karim 90,000Ong Ju Yan 90,000

Other than disclosed above, none of the other Directors hold any shares, warrants and options in the Company or its relatedcompanies.

Notes:

(1) Deemed interested by virtue of their substantial shareholdings in Green Packet Holdings Ltd.

(2) Deemed interested through its wholly owned subsidiary, OSK Technology Ventures Sdn Bhd.

(3) Deemed interested by virtue of his substantial shareholdings in OSK Venture International Berhad, the holding company of OSK

Technology Ventures Sdn Bhd.

(4) Deemed interested by virtue of its interest in PacificQuest.

(5) Deemed interested by virtue of its interest in Sedco International Holdings Ltd.

analysis of




Types of Securities : Warrants 2009/2014

Date of Expiry : 27 September 2014

Exercise Right : Each warrant entitles the registered holder to subscribe for one new ordinary share of RM0.20each in the Company at an exercise price of RM0.95 per ordinary share

Voting Rights : One vote per warrant in respect of a meeting of warrant holders

DISTRIBUTION OF WARRANT HOLDINGS

No. of % of Total % of Range of Warrant Warrant Warrant WarrantWarrant Holdings Holders Holders Holdings Holdings

1- 99 63 1.58 2,741 0.00˜ 100-1,000 412 10.34 259,187 0.131,001-10,000 1,512 37.94 9,527,763 4.8210,001-100,000 1,722 43.21 64,531,214 32.66100,001-9,880,687* 274 6.88 86,015,342 43.539,880,688*and above 2 0.05 37,277,528 18.86

Total 3,985 100.00 197,613,775 100.00

Notes:

˜ Negligible

* 5% of the issued warrants

THIRTY LARGEST REGISTERED WARRANT HOLDERS

% of Name No. of Warrants Warrant Holdings

1. OSK Technology Ventures Sdn Bhd 23,505,653 11.89

2. PacificQuest 13,771,875 6.97

3. Public Nominees (Tempatan) Sdn Bhd 2,082,400 1.05Pledged Securities Account for Ong Yew Beng (E-SJA)

4. Sim Seow Heng 2,000,000 1.01

5. Chan Weng Sing 1,909,000 0.97

6. Public Invest Nominees (Tempatan) Sdn Bhd 1,815,600 0.92Exempt an for Phillip Securities Pte Ltd (Clients)

7. Lim Mei Choo 1,600,000 0.81

8. Chan Weng Sing 1,565,000 0.79

9. Sim Seow Heng 1,400,000 0.71

10. AMSEC Nominees (Tempatan) Sdn Bhd 1,300,000 0.66Pledged Securities Account for Chua Kim Boon

11. Tan Kin Lee 1,250,050 0.63

analysis of

warrantholdings as at 7 May 2012



THIRTY LARGEST REGISTERED WARRANT HOLDERS (CONT’D)

Name No. of Warrants % of Warrant

12. Ng Lee Ha 1,242,200 0.63

13. OSK Nominees (Tempatan) Sdn Berhad 1,241,765 0.63Pledged Securities Account for Puan Chan Cheong

14. Lim Sze Hock 1,200,000 0.61

15. AllianceGroup Nominees (Tempatan) Sdn Bhd 1,186,800 0.60Pledged Securities Account for Lim Lee Peng (8059245)

16. CIMSEC Nominees (Tempatan) Sdn Bhd 1,030,000 0.52CIMB Bank for Yap Ngan Choy (MY0020)

17. Tang Tong Seng 1,000,000 0.51

18. Lee Oi Oi 850,000 0.43

19. RHB Capital Nominees (Tempatan) Sdn Bhd 830,000 0.42Pledged Securities Account for Foong Cheng Keat (CEB)

20. Wong Yun Jong 800,500 0.41

21. RHB Capital Nominees (Tempatan) Sdn Bhd 770,000 0.39Pledged Securities Account for Wong Siek Kong (CEB)

22. Mayban Nominees (Tempatan) Sdn Bhd 750,000 0.38Tan Kim Tat

23. RHB Capital Nominees (Tempatan) Sdn Bhd 740,000 0.37Pledged Securities Account for Wong Seek Loon (CEB)

24. Phang Wai Keen 700,000 0.35

25. Wong Swee Ping 687,200 0.35

26. CIMSEC Nominees (Tempatan) Sdn Bhd 670,000 0.34CIMB for Lei Yee Leong (PB)

27. CIMSEC Nominees (Tempatan) Sdn Bhd 650,000 0.33CIMB Bank for Sim Seow Heng (MPO127)

28. ECML Nominees (Tempatan) Sdn Bhd 650,000 0.33Pledged Securities Account for Poh Seng Kian (04PO006Q-004)

29. Public Nominees (Tempatan) Sdn Bhd 645,000 0.33Pledged Securities Account for Lee Joo Choon (E-TJJ)

30. Law Siong Hiong 642,500 0.33

analysis of

warrantholdings as at 7 May 2012 (cont’d)



NOTICE IS HEREBY GIVEN that the Eleventh Annual General Meeting of GREEN PACKETBERHAD will be held at The Auditorium, Level 11, Packet Hub, 159, Jalan Templer, 46050 PetalingJaya, Selangor Darul Ehsan on Thursday, 28 June 2012 at 10.00 a.m. for the purpose ofconsidering the following businesses:

AGENDA

Ordinary Business

1. To lay the Audited Financial Statements for the financial year ended 31 December 2011 together with the Reports of theDirectors and the Auditors thereon. (Refer to Explanatory Note A)

2. To approve the payment of Directors’ fees of RM248,062 for the financial year ended 31 December 2011 (2010:RM236,250). (Resolution 1)

3. To re-elect the following Directors who are retiring pursuant to Article 86 of the Company’s Articles of Association:

Tan Sri Dato’ Kok Onn (Resolution 2)Mr. Boey Tak Kong (Resolution 3)Mr. Ong Ju Yan (Resolution 4)

4. To consider and if thought fit, pass the following resolution pursuant to Section 129(6) of the Companies Act, 1965 as anordinary resolution: (Resolution 5)

“THAT Tan Sri Datuk Dr. Haji Omar Bin Abdul Rahman who retires pursuant to Section 129(2) of the Companies Act, 1965be and is hereby re-appointed Director of the Company to hold office until the next Annual General Meeting.”

(Resolution 6)

5. To re-appoint Messrs Crowe Horwath as Auditors of the Company and to authorise the Directors to fix their remuneration.(Resolution 7)

Special Business

To consider and if thought fit, pass the following ordinary resolutions:

6. Authority to Issue Shares Pursuant to Section 132D of the Companies Act, 1965

“THAT pursuant to Section 132D of the Companies Act, 1965, the Directors be and are hereby authorised to issue sharesin the Company at any time until the conclusion of the next Annual General Meeting and upon such terms and conditionsand for such purposes as the Directors may, in their absolute discretion, deem fit, provided that the aggregate numberof shares to be issued does not exceed 10% of the issued and paid-up share capital (excluding treasury shares) of theCompany at the time of issue and that the Directors be and are also empowered to obtain the approval for the listing ofand quotation for the additional shares so issued, subject to the Companies Act, 1965, the Articles of Association of theCompany and approval from the Bursa Malaysia Securities Berhad and other relevant regulatory authorities where suchapproval is necessary.” (Resolution 8)

notice of

annual general meeting



7. Proposed Renewal of Authority to Purchase its Own Shares by the Company

“THAT subject to Section 67A of the Companies Act, 1965 (“the Act”) and Part IIIA of the Companies Regulations, 1966,provisions of the Company’s Articles of Association and the requirements of Bursa Malaysia Securities Berhad and anyother relevant authority, the Directors of the Company be and are hereby authorised to make purchases of ordinary sharesof RM0.20 each in the Company’s issued and paid-up share capital through the Bursa Malaysia Securities Berhad subjectfurther to the following:

(i) the maximum number of shares which may be purchased and/or held by the Company shall be equivalent to 10%of the issued and paid-up share capital (excluding treasury shares) of the Company (“Shares”) for the time being;

(ii) the maximum fund to be allocated by the Company for the purpose of purchasing the Shares shall not exceed theaggregate of the retained profits and share premium account of the Company. As of 31 December 2011, the auditedretained profits and share premium account of the Company were RM14,575,636 and RM345,371,755 respectively;

(iii) the authority conferred by this resolution will commence immediately upon passing of this resolution and will expireat the conclusion of the next Annual General Meeting of the Company, unless earlier revoked or varied by ordinaryresolution of the shareholders of the Company in a general meeting or the expiration of the period within which thenext Annual General Meeting after that date is required by the law to be held, whichever occurs first, but not so asto prejudice the completion of purchase(s) by the Company before the aforesaid expiry date and, in any event, inaccordance with the provisions of the guidelines issued by Bursa Malaysia Securities Berhad or any other relevantauthority; and

(iv) upon completion of the purchase(s) of the Shares by the Company, the Directors of the Company be and are herebyauthorised to deal with the Shares in the following manner:-

(a) cancel the Shares so purchased; or(b) retain the Shares so purchased as treasury shares; or(c) retain part of the Shares so purchased as treasury shares and cancel the remainder; or(d) distribute the treasury shares as dividends to shareholders and/or resell on Bursa Malaysia Securities Berhad

and / or cancel all or part of them; or

in any other manner as prescribed by the Act, rules, regulations and orders made pursuant to the Act and therequirements of Bursa Malaysia Securities Berhad and any other relevant authority for the time being in force;

AND THAT the Directors of the Company be and are hereby authorised to take all such steps as are necessary orexpedient to implement or to effect the purchase(s) of the Shares with full power to assent to any condition, modification,variation and/or amendment as may be imposed by the relevant authorities and to take all such steps as they may deemnecessary or expedient in order to implement, finalise and give full effect in relation thereto.” (Resolution 9)

To consider and if thought fit, pass the following Special Resolution:

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

“That in line with the amendments prescribed under the Main Market Listing Requirements of Bursa Malaysia SecuritiesBerhad, the proposed amendments to the Articles of Association of the Company as set out in Appendix I enclosed withthe Annual Report 2011, be and are hereby approved.” (Resolution 10)

BY ORDER OF THE BOARDTAI SIEW MAY (MAICSA 7015823)Company Secretary

Kuala Lumpur6 June 2012

notice of

annual general meeting (cont’d)



Notes :

1. A member entitled to attend and vote at this meeting is entitled to appoint proxy/proxies to attend and vote in his stead but his attendance shall

automatically revoke the proxy’s authority. A proxy may but need not be a member of the Company. If the proxy is not a member of the Company,

he need not be an advocate, an approved company auditor or a person approved by the Registrar of Companies.

2. A member shall be entitled to appoint up to three (3) proxies to vote at the same meeting. Where a member appoints more than one (1) proxy, the

appointment shall be invalid unless he specifies the proportion of his holdings to be represented by each proxy.

3. Where a member of the Company is an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991 (“SICDA”),

it may appoint at least one (1) proxy but limited to three (3) proxies in respect of each Securities Account it holds with Securities of the Company

standing to the credit of the said Securities Account.

4. Where a member of the Company is an exempt authorised nominee which holds ordinary shares in the Company for multiple beneficial owners in

one securities account (“Omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect

of each omnibus account it holds. An exempt authorised nominee refers to an authorised nominee defined under the SICDA which is exempted

from compliance with the provisions of subsection 25A(1) of the SICDA.

5. The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing and if the appointor

is a corporation/company, either under its common seal or the hands of its attorney.

6. The instrument appointing a proxy must be deposited at the Registered Office of the Company at 10th Floor, Menara Hap Seng, No. 1 & 3, Jalan

P. Ramlee, 50250 Kuala Lumpur not less than forty-eight (48) hours before the time appointed for holding the meeting or any adjournment thereof.

7. For the purpose of determining who shall be entitled to attend this meeting, the Company shall be requesting the Bursa Malaysia Depository Sdn

Bhd in accordance to Article 53 of the Articles of Association of the Company and Section 34(1) of the Securities Industry (Central Depositories)

Act 1991, a Record of Depositors as at 20 June 2012. Only a Depositor whose name appears on the Record of Depositors as at 20 June 2012

shall be entitled to attend this meeting or appoint proxies to attend and vote on his/her behalf.

EXPLANATORY NOTE A

The Audited Financial Statements under this agenda item is meant for discussion only as the provision of Section 169(1) of the Companies Act 1965 doesnot require a formal approval of the shareholders and hence this item is not put forward for voting.

EXPLANATORY NOTES ON SPECIAL BUSINESS:

1. The Resolution 8, if passed, will empower the Directors of the Company to issue shares up to 10% of the total issued share capital (excludingtreasury shares) of the Company at the time of such issuance of shares and for such purposes as they consider would be in the best interest ofthe Company without having to convene separate general meetings.

The purpose of this general mandate will provide flexibility to the Company for any possible fund raising activities, including but not limited toplacement of shares, funding future investment project(s), working capital and/or acquisitions.

This authority, unless revoked or varied at a general meeting, will expire at the conclusion of the next Annual General Meeting of the Company. Noshares had been issued by the Company since obtaining the said authority from its shareholders at the last Annual General Meeting held on 24 June 2011.

On behalf of the Board of Directors of the Company, OSK Investment Bank Berhad has on 24 May 2012 announced to Bursa Malaysia SecuritiesBerhad that the Company proposes to undertake a private placement of up to 10% of the issued and paid-up share capital of the Company to thirdparty investors to be identified later.

2. The Resolution 9, if passed, will empower the Company to purchase and/or hold up to 10% of the issued and paid-up share capital (excludingtreasury shares) of the Company. This authority unless revoked or varied by the Company at a General Meeting will expire at the next AnnualGeneral Meeting.

Please refer to the Share Buy-Back Statement dated 6 June 2012 which is dispatched together with this Annual Report for further information.

3. The Resolution 10, if passed, will render the Articles of Association of the Company to be in line with the recent amendments to the Main ListingRequirements of Bursa Malaysia Securities Berhad.

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

No individual other than the retiring Directors is seeking appointment/election as a Director at the forthcoming Eleventh AnnualGeneral Meeting of the Company. The details of the retiring Directors standing for re-appointment/re-election are set out in theDirectors’ Profile appearing on pages 22 to 26 of this Annual Report.

notice of

annual general meeting (cont’d)



PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY

1. THAT the following additional definition be inserted immediately after the Word “Depositor” under Article 2 of theCompany’s Articles of Association:-

2. Words Meanings

Dividend Reinvestment Scheme means a scheme which enables members to reinvest cash dividendinto new shares.

2. THAT the following new Article be inserted immediately after Article 71(1) of the Company’s Articles of Association toread as follows:-

71(1A). Notwithstanding subsection (2) below, where a member of the company is an exempt authorised nomineewhich holds ordinary shares in the Company for multiple beneficial owners in one securities account(“Omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee mayappoint in respect of each omnibus account it holds. An exempt authorised nominee refers to anauthorised nominee defined under the Central Depositories Act which is exempted from compliance withthe provisions of subsection 25A(1) of the Central Depositories Act.

3. THAT the following new Article be inserted immediately after Article 130(e) of the Company’s Articles of Association to read as follows:-

130(f). Subject to the approval being obtained from the members of the Company and the Listing Requirements,the Company may issue shares pursuant to a Dividend Reinvestment Scheme to all its members who areentitled to dividend in accordance with the provisions of the Act and any rules, regulations and guidelinesthere under or issued by the Exchange and any other relevant authorities in respect thereof.

4. THAT the following amendments be made to the existing articles (for which differences are highlighted in bold belowunder “Amended Articles” respectively):-

Existing Article 71(3):

71(3) Save for the authorised nominee as defined under Article 71(1) above, a proxy may but need not be a member of the Company. If the proxy is not a member, he need not be an advocate, an approvedcompany auditor or a person approved by the Registrar of Companies.

Amended Article 71(3):

71(3) Save for the authorised and exempt authorised nominees as defined under Article 71(1) and Article71(1A) above, a proxy may but need not be a member of the Company. If the proxy is not a member, heneed not be an advocate, an approved company auditor or a person approved by the Registrar ofCompanies. There shall be no restriction as to the qualification of the proxy.

Existing Article 75:

75. A proxy shall be entitled to vote on a show of hands on any question at any general meeting.

Amended Article 75:

75. A proxy shall be entitled to vote on a show of hands on any question and shall have the same rights asthe member to speak at any general meeting.

appendix I

Voting of proxy at generalmeeting

Voting ofproxy andrights ofproxy tospeak atgeneralmeeting

GREEN PACKET BERHAD (534942-H)



This page has been intentionally left blank.


I/We ……………………………………................…..NRIC / Passport / Company No. ……….......………...Tel: …………................

of …………………………………………………………………………………………………………………........................................

being a Shareholder of GREEN PACKET BERHAD (534942-H) hereby appoint *THE CHAIRMAN OF THE MEETING or failinghim/her

Proportion of Name Address NRIC/ Passport No. Shareholdings (%)

1.

*And/or (delete as appropriate)

2.

*And/or (delete as appropriate)

3.

as my/our proxy/proxies, to vote for me/us on my/our behalf at the Eleventh Annual General Meeting of the Company to beheld at The Auditorium, Level 11, Packet Hub, 159, Jalan Templer, 46050 Petaling Jaya, Selangor Darul Ehsan on Thursday, 28June 2012 at 10.00 a.m. or at any adjournment thereof.

* If you wish to appoint other person/persons to be your proxy/proxies, kindly delete the words “The Chairman of the

Meeting or failing him” and insert the name/names of the person/persons desired.

My/our proxy/proxies is/are to vote as indicated below:

NO. RESOLUTIONS FOR AGAINST

1. To approve the payment of Directors’ fees of RM248,062 for the financial year ended 31 December 2011.

2. To re-elect Tan Sri Dato’ Kok Onn as Director.

3. To re-elect Mr. Boey Tak Kong as Director.

4. To re-elect Mr. Ong Ju Yan as Director.

5. To re-appoint Tan Sri Datuk Dr. Haji Omar Bin Abdul Rahman as Director.

6. To re-appoint Messrs Crowe Horwath as Auditors of the Company and to authorise the Directors to fix their remuneration

7. Ordinary Resolution - Authority to Issue Shares Pursuant to Section 132D of theCompanies Act, 1965

8. Ordinary Resolution - Proposed Renewal of Authority to Purchase Its Own Sharesby the Company

9. Special Resolution - Proposed Amendments to the Articles of Association of theCompany.

(Please indicate with a cross (X) in the space provided, how you wish your vote to be cast in respect of the above resolutions.If you do not do so, the proxy may vote or abstain at his/her discretion.)

Dated this……………… day of………………2012 Number of shares held:CDS Account No.:

.....................................................................Signature/Common Seal of Shareholder

form ofproxy

GREEN PACKET BERHAD(534942-H)

(Incorporated in Malayisa under the Companies Act, 1965)


Notes :

1. A member entitled to attend and vote at this meeting is entitled to appoint proxy/proxies to attend and vote in his stead but his attendance shall automaticallyrevoke the proxy’s authority. A proxy may but need not be a member of the company. If the proxy is not a member of the company, he need not be an advocate,an approved company auditor or a person approved by the Registrar of Companies.

2. A member shall be entitled to appoint up to three (3) proxies to vote at the same meeting. Where a member appoints more than one (1) proxy, the appointmentshall be invalid unless he specifies the proportion of his holdings to be represented by each proxy.

3. Where a member of the company is an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991 (“SICDA”), it may appointat least one (1) proxy but limited to three (3) proxies in respect of each securities account it holds with securities of the company standing to the credit of thesaid securities account.

4. Where a member of the company is an exempt authorised nominee which holds ordinary shares in the company for multiple beneficial owners in one securitiesaccount (“omnibus account”), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus accountit holds. An exempt authorised nominee refers to an authorised nominee defined under the sicda which is exempted from compliance with the provisions ofsubsection 25A(1) of the SICDA.

4. The instrument appointing a proxy shall be in writing under the hand of the appointor or his attorney duly authorised in writing and if the appointor is a corporation/company, either under its common seal or the hands of its attorney.

5. The instrument appointing a proxy must be deposited at the registered office of the company at 10th Floor, Menara Hap Seng, No. 1 & 3, Jalan P. Ramlee,50250 Kuala Lumpur not less than forty-eight (48) hours before the time appointed for holding the meeting or any adjournment thereof.

6. For the purpose of determining who shall be entitled to attend this meeting, the Company shall be requesting the Bursa Malaysia Depository Sdn Bhd

in accordance to Article 53 of the Articles of Association of the Company and Section 34(1) of the Securities Industry (Central Depositories) Act 1991, a

Record of Depositors as at 20 June 2012. Only a Depositor whose name appears on the Record of Depositors as at 20 June 2012 shall be entitled to attend

this meeting or appoint proxies to attend and vote on his/her behalf.

fold here

fold here

The Company Secretary

GREEN PACKET BERHAD(534942-H)

10th Floor Menara Hap SengNo. 1 & 3, Jalan P. Ramlee

50250 Kuala Lumpur

Stamp


• 4GWE 2010 - Product of the Year Awards for DX, UH & ICMP• Frost & Sullivan 2010 - Most Promising Service Provider (P1)• Effie Awards 2010 - Gold Winner (P1)• MSC-APICTA Award - Best of Start-Up Company, 2009 (P1)• Appointed as Board Member of WiMAX Forum® (P1)• Ranked top 10 Tech Brands for 2009 - PC.COM (P1)• Named Best WiMAX Service 2009 - PC.COM (P1)• Awarded Best Direct Mail 2009 Gold - Direct Marketing

Association (P1)• Winner of TMC WiMAX Distinction 2009 awards for Green Packet

D Series and U Series modems• Nominee, Mobile Content Award 2009 for Green Packet Intouch

Connection Manager• Red Herring Asia 2008 - Most Innovative Private Technology

Company (P1)

• No. 1 Commercial WiMAX Network in the Asia Pacific (P1)• No. 2 Commercial WiMAX Network in the world - 802.16e 2.3 GHz (P1)• Winner of Deloitte Technology Fast 500, Asia Pacific 2007• Listed amongst "14 of Asia's Brightest Technology Companies" in Network

World Asia, 2007• Winner of the MSC-APICTA Merit Award (Communications Application

Category) for 2005• Winner of the 2004 PIKOM Technopreneur of the Year Award (Puan Chan

Cheong, Group Managing Director/ CEO of Green Packet Berhad )• Winner of Intel's “Outstanding Solution Provider Award for Education in the

Asia Pacific, 2004”• Winner of MSC-APICTA Award (Communications Application Category)

for 2004• Listed amongst the “10 Mobile Technology Companies to Watch” in San

Jose Mercury News, 2003• Intouch Connectivity Experience was nominated as a finalist for the World

Vendor Award 2012

our awards

and accolades

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