WEIDA (M) BHD Report 2001.pdf · WEIDA (M) BHD (504747-W) page 5 TUAN HAJI SU’UT HAJI SUHAILI Tuan Haji Su’ut Haji Suhaili, aged 54 is the Group Chairman. He was appointed to

WEIDA (M) BHD(504747-W)

(Incorporated in Malaysia)

Cover Rationale

The design employs the striking green shade of the Weida logo to dominate the cover. It is apowerful way to establish a strong identity for Weida (M) Bhd, in the process elevating thecompany's image to that of a leading player in the HDPE manufacturing industry.

The second key element of the design is the logo itself. It has been rendered in 3-D to show depth.The depth of the Weida Group, whose integrated activities include not only manufacturing but theprovision of one-stop services, turnkey contracting and management services in its related industries.

Behind the logo is a brilliant glow, symbolising the energy and dynamism of the Group. The glowextends outwards, pointing the way to future growth. The circles and lines emanating from the logoindicate the direction and precision of management strategies in driving the Group forward. Iconsand photographs of the Group's products are also used to represent its activities.

In summary, the design portrays a leader in its industry, ever moving forward to extend its range ofexpertise and consolidate its strengths.

LEADING THROUGH INTEGRATION AND STRATEGIC GROWTH

CONTENTS

2 Notice of Second Annual General Meeting

3 Notice of Dividend Entitlement

4 Corporate Information

5 Board of Directors

7 Chairman’s Statement

9 Audit Committee

11 Corporate Governance Statement

12 Statutory Financial Statements

49 List of Properties

50 Analysis of Shareholdings

55 Form of Proxy

CONTENTS

WEIDA (M) BHD (504747-W)

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NOTICE OF SECOND ANNUAL GENERAL MEETING

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A G E N D A1. To receive and adopt the Audited Accounts for the year ended 31 March 2001 together with the Reports of

the Directors and Auditors thereon.

2. To declare a First and Final dividend of 5% less 28% income tax, in respect of the year ended 31 March2001 as recommended by the Directors.

3. To re-elect the following directors who retire in accordance with Article 88 of the Company’s Articles ofAssociation and being eligible, offer themselves for re-election :-(a) Tuan Haji Su’ut Bin Haji Suhaili(b) Lee Choon Chin(c) Datu Voon Chen Hian @ Voon Chen Kok(d) Tuan Haji Zainal Abidin Bin Ahmad(e) Ahmad Tarmizi Bin Sulaiman(f) Zaidi Bin Ahmad(g) Yong Lin Lin(h) Jee Hon Chong(i) Datuk Dr. Stalin Hardin(j) YBhg. Dato Abdul Rahiman Bin A.S. Dawood

4. To approve the payment of directors’ fees for the year ended 31 March 2001.

5. To re-appoint Messrs. PricewaterhouseCoopers as the Company’s Auditors and to authorise the Directors tofix their remuneration for the ensuing year.

6. As Special BusinessTo consider and, if thought fit, pass the following resolutions as Special and Ord i n a ry Resolutions respectively :-

Special ResolutionAmendments to the Company’s Articles of Association"THAT in compliance with the Listing Requirements of the Kuala Lumpur Stock Exchange, the alterations, modifications and additions to the Articles of Association as set out in Appendix A of the Annual Report2001, be and are hereby approved."

Ordinary ResolutionAuthority pursuant to Section 132E of the Companies Act, 1965"THAT in accordance with Section 132E of the Companies Act, 1965, authority be and is hereby given tothe Company or its related corporations to enter into arrangements or transactions with the Directors of theCompany or any person connected with such Directors (within the meaning of Section 122A, CompaniesAct, 1965) whereby the Company or its related corporations may acquire from or dispose to such Directors or connected persons non-cash assets including but not limited to land, development properties, capital equipment and related machineries and/or any other assets or products of the Company or its related corporations provided that such acquisitions or disposals are on commercial terms and in the ordinarycourse of business, such authority will continue to be in force until the conclusion of the next Annual General Meeting AND THAT for the avoidance of doubt, any such transactions entered into by the Company or its subsidiaries with the Directors or connected persons prior to the date of this resolution be and are hereby approved and ratified."

7. To transact any other business which may properly be transacted at an annual general meeting, due noticeof which shall have been previously given in accordance with the Companies Act, 1965 and the Company’sArticles of Association.

Resolution 1

Resolution 2

Resolution 3

Resolution 4

Resolution 5

Resolution 6

Resolution 7

Resolution 8

Resolution 9

Resolution 10

Resolution 11

Resolution 12

Resolution 13

Resolution 14

Resolution 15

Resolution 16

NOTICE IS HEREBY GIVEN that the Second Annual General Meeting of the Company will be held at Kenyalang Room,Lobby Floor, Hilton Kuching, Jalan Tunku Abdul Rahman, 93100 Kuching, Sarawak on Wednesday, 22 August 2001 at 10.00am for the following purposes :-

NOTICE IS ALSO HEREBY GIVEN that the First and Final Dividend of 5% less 28% income tax, for the financial year ended31 March 2001, if approved at the Second Annual General Meeting, will be paid on 10 October 2001 to Depositors whosenames appear in the Record of Depositors on 14 September 2001.

A depositor shall qualify for entitlement only in respect of :-

(a) Shares transferred into the Depositors’ Securities Account before 12.30 p.m. on 14 September 2001 in respect of ordinarytransfers;

(b) Shares bought on the Kuala Lumpur Stock Exchange on a cum entitlement basis according to the Rules of the Kuala Lumpur Stock Exchange.

BY ORDER OF THE BOARD

LEONG OI WAH (MAICSA 7023802)

WAN SULEIMAN BIN WAN SADI (LS 00593)

VOON JAN MOI (MAICSA 7021367)

Joint Company Secretaries

Kuching, Sarawak

Dated : 31 July 2001

Explanatory Notes on Special Business(a) Special Resolution on Amendments to the Company’s Articles of Association

The Special Resolution on the amendments to the Company’s Articles of Association is to bring the articles in line with

the new Listing Requirements of the Kuala Lumpur Stock Exchange.

(b) Ordinary Resolution pursuant to Section 132E of the Companies Act, 1965Section 132E of the Companies Act, 1965 prohibits a company or its subsidiaries from entering into any arrangement or

transaction with its Directors or persons connected with such Directors in respect of the acquisition from or disposal to such

Directors or connected persons of any non-cash assets of the "requisite value" without prior approval of the Company in

General Meeting. According to the Companies Act, 1965, a non-cash asset is considered to be of the "requisite value", if,

at the time of the arrangement or transaction, its value is greater than RM250,000 or 10% of the Company’s net assets,

subject to minimum of RM10,000.

The proposed Ordinary Resolution 16 if passed, will authorise the Company and each of its subsidiaries to acquire from

or dispose to its Directors or connected persons, products, services or any other non-cash assets which may fall within the

definition of the "requisite value", provided that such acquisitions or disposals are on normal commercial terms and in the

ordinary course of business. This authority, unless revoked or varied by the Company at general meeting, will expire at the

conclusion of the next Annual General Meeting of the Company.

Notes :-

1. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Companies Act 1965 shall not apply to the Company.

2. To be valid, the duly completed proxy form must be deposited at the Office of the Company at No. 187, Lorong Datuk Abang Abdul Rahim 7, 93450 Kuching,

Sarawak not less than 48 hours before the time set for holding the meeting or any adjournment thereof.

3. A member shall be entitled to appoint more than one (1) proxy to attend and vote at the same meeting provided that the provisions of Section 149(1)(c) of

the Companies Act 1965 are complied with.

4. Where a member appoints more than one (1) proxy, the appointment shall be invalid unless he specifies the proportions of his shareholdings to be represented

by each proxy.

5. If the appointor is a corporation this form must be executed under its common seal or under the hand of an officer or attorney duly authorised.

NOTICE OF DIVIDEND ENTITLEMENT


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DirectorsTuan Haji Su’ut Haji Suhaili (Independent Non-executive Chairman)

Lee Choon Chin (Managing Director)

Jee Hon Chong (Executive Director)

Yong Lin Lin (Executive Director)

Zaidi Bin Ahmad (Executive Director)

Ahmad Tarmizi Bin Sulaiman (Non-executive Director)

Tuan Haji Zainal Abidin Bin Ahmad (Non-executive Director)

Datu Voon Chen Hian @ Voon Chen Kok (Independent Non-executive Director)

Datuk Dr Stalin Hardin (Independent Non-executive Director)

YBhg Dato Abdul Rahiman Bin A S Dawood (Independent Non-executive Director)

Company SecretariesWan Suleiman Bin Wan Sadi (LS 00593)

Leong Oi Wah (MAICSA 7023802)

Voon Jan Moi (MAICSA 7021367)

AuditorsPricewaterhouseCoopers9th FloorBangunan BINAMASJalan Padungan93100 KuchingSarawakTel: 082-413958Fax: 082-412644

BankersMalayan Banking BhdRHB Bank BerhadUnited Overseas Bank (Malaysia) BhdPublic Bank BhdAlliance Bank BhdHSBC Bank Malaysia BhdOCBC Bank (Malaysia) Bhd

Advocates & SolicitorsAlvin Chong & PartnersSio & Ting Advocates


CORPORATE INFORMATION

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RegistrarSignet Share Registration Services Sdn BhdTingkat 11 Tower BlockKompleks AntarabangsaJalan Sultan Ismail50250 Kuala LumpurTel: 03-2145 4337Fax: 03-2142 1353E-mail: [email protected]

Registered office187 Lorong Datuk Abang Abdul Rahim 793450 KuchingTel: 082-486684Fax: 082-486686

Stock Exchange ListingSecond Board of the Kuala Lumpur Stock ExchangeStock Name: WEIDAStock Code: 7111

BOARD OF DIRECTORS


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TUAN HAJI SU’UT HAJI SUHAILITuan Haji Su’ut Haji Suhaili, aged 54 is the Group Chairman. He was appointed to the Board on 25 October 2000. An MBAgraduate of Henley Brunel University in United Kingdom, Tuan Haji Su’ut has served in numerous ministries and agencies inSarawak, amongst others, he has held appointment as Permanent Secretary to the State Ministry of Land Development, Ministryof Industrial Development. Currently, Tuan Haji Su’ut is the General Manager of Bintulu Development Authority, a regionalauthority responsible for the development of the entire Bintulu region. Tuan Haji Su’ut also sits on the following Board; ShellTimur Sdn Bhd, Bintulu Edible Oil Sdn Bhd, Borneo Development (S) Corporation Sdn Bhd, Ferego Sdn Bhd, Kidurong PropertiesSdn Bhd, Bandar Sinar Sdn Bhd, Bintulu Sembawang Sdn Bhd, BQ Batching (Bintulu) Sdn Bhd, Custodev Dua Sdn Bhd, BintuluPort Authority and Bintulu Premix Sdn Bhd. He has more than three (3) years experience in HDPE related industry.

LEE CHOON CHINLee Choon Chin, aged 47, is the Group Managing Director/Chief Executive Officer. He was appointed to the Board on 25October 2000. Graduated from University of Malaya with a Bachelor of Science (Hons) in 1978, Mr Lee started his career with3M Malaysia Sdn Bhd, a subsidiary of the American multinational company as the Sarawak Area Manager until 1983.Subsequent to this, he set up Syarikat Weida a trading firm specialising in diversified engineering products and services. In1988, he led the Group to commence manufacturing in Sarawak. As a founder of Weida Group, his excellent entrepreneurialskills backed by years of experience in HDPE related industry have steered Weida Group to become an establishedmanufacturer in Malaysia.

TUAN HAJI ZAINAL ABIDIN BIN AHMADZainal Abidin Bin Ahmad, aged 43. He was appointed to the Board on 25 October 2000. He graduated with a Master of Artsdegree in Management from the University of Kent at Canterbury, England in 1985. He obtained his first degree, a Bachelorof Arts, from University Kebangsaan Malaysia in 1981 and subsequently a University Diploma in Accounting from the Universityof Kent at Canterbur y, England in 1984. Between 1981 to 1987, he was with the Sarawak Civil Service.

In 1987, he left the Government Service and moved on to the corporate sector. He started in the construction industry but hassince expanded to other fields such as property development, oil palm plantations, finance and is still currently involved in theseactivities. He is also the Group Managing Director / Chief Executive officer of Zecon Engineering Berhad and ManagingDirector of Sarawak Concrete Industries Berhad, which are both listed on the Kuala Lumpur Stock Exchange.

JEE HON CHONGJee Hon Chong, aged 41. He was appointed to the Board on 25 October 2000. He graduated from Tunku Abdul RahmanCollege and subsequently obtained his degree in Mechanical Engineering from the Engineering Council, United Kingdom.

Started in Weida as a Production Executive and later as the Factory Manager, he is presently the Group General Manager ofWeida’s manufacturing plant in Sarawak, Sabah and Peninsula Malaysia. He is one of the pioneers, being the first factoryengineer when Weida started the manufacturing operation. Since the commencement of the manufacturing division in Kuchingin 1988, he has successfully commissioned another two factories in Kota Kinabalu and Nilai. Currently, he is responsible for theoverall planning and development of the manufacturing portfolio in Weida.

AHMAD TARMIZI BIN SULAIMANEncik Ahmad Tarmizi Sulaiman aged 38, was appointed to the Board on 25 October 2000. He holds a Degree in BusinessAdministration for Syracuse University, New York and a Master’s in Business Administration from the University of Wisconsin,United States of America.

He was an Investment Manager with Arab-Malaysian Merchant Bank Bhd and American International Assurance to the time hejoined Amanah Saham Sarawak Bhd as the Chief Executive Officer.

He sits on the Boards of Permodalan Assar Sdn Bhd and its other subsidiary companies. Sarawak Economic DevelopmentCorporation, Sarawak Transport Company Bhd, Zecon Engineering Bhd and Sarawak Concrete Industries Bhd.

He has an extensive experience in corporate finance, management of portfolios and fund for corporations, institutions and aswell as trust funds.

YONG LIN LINYong Lin Lin, aged 40, graduated with a Diploma in Electrical and Electronic Engineering in 1985. He was appointed to theBoard on 25 October 2000. Starting with Weida in 1986 as an Sales Executive, he became the General Manager of WeidaResources Sdn Bhd in 1992. Together with the Managing Director of Weida, he has been the driving force in steering Weidafrom a small trading company into a nation-wide company. He is at present responsible for the formulation and implementationof the marketing strategies for the Group.

ZAIDI BIN AHMADZaidi Bin Ahmad, aged 41, was appointed to the Board on 25 October 2000 and subsequently redesignated as an ExecutiveDirector on 7 March 2001. He holds a Diploma in Banking Studies from UiTM and a Masters of Business Administration fromLeicester University, United Kingdom.

He has extensive experience in finance where he last served as a CEO of Advance Finance Berhad, a licensed finance companyfrom 1994 to 2000.

DATU VOON CHEN HIAN @ VOON CHEN KOKDatu Voon Chen Hian @ Voon Chen Kok, aged 57, was appointed to the Board on 25 October 2000. He holds a Bachelor ofEngineering (Civil) from the University of Tasmania, Australia. He started his career in 1969 with Jabatan Kerja Raya ("JKR")Kapit Division and Sarikei Division as the engineer-in-charge. In the following year, he was promoted to the Assistant DivisionEngineer as well as Resident Engineer of Sibu Division. In 1980, he was appointed as the Chief Engineer of Armed Forces Worksof JKR, Sarawak and was later promoted to be the Assistant Director of Water Supply and Sewerage Branch of Sarawak in1986. In 1988, he was appointed as the Chief Hydraulic Engineer of JKR Sarawak. From 1992 to 1996 he headed the WaterSupply and Sewerage Branch of JKR, Sarawak Division while in October, 1995 he was appointed as the Chairman of SibuWater Board and in November of the same year, appointed to the Board of Director of Water Board Northern Region Sdn Bhd.Subsequently, in January, 1996, he was appointed as the Deputy Director of Public Works Department and was promoted tobe the Director of Public Works Department of Sarawak in November of the same year and serves in the same department untiltoday.

DATUK DR STALIN HARDINDatuk Dr Stalin Hardin, aged 59, was appointed to the Board on 16 December 2000. He obtained his Doctor of Medicinedegree from the University of Toronto, Canada in 1996 and a Master of Public Health post-graduate degree from TulaneUniversity, USA in 1970. He worked for the Malaysian government in the Health Department, Sarawak in various capacitiesfor 29 years till his retirement in November 1966. Presently, he is the Adviser to the State Government for the implementationof the Sarawak International Medical Centre. He is also the Consultant to Medi-serve Sdn Bhd. He sits on the Board of Directorsof Hardin and Son Sdn Bhd, a family owned company.

YBHG DATO ABDUL RAHIMAN BIN A S DAWOODDato’ Dr Abdul Rahiman Bin A S Dawood, aged 47. He was appointed to the Board on 12 April 2001. He is also the ManagingDirector and substantial shareholder of Azrahi Holdings Sdn Bhd and N S Water Konsortium Sdn Bhd. He was appointed tothe Board of Directors of Azrahi Holdings and N S Water Konsortium on 21 June 1996 and 30 December 1997 respectively.He is also the founder of Azrahi Holdings and N S Water Konsortium.

He holds a Bachelor of Dental Surgery from University of Mysore, which he obtained in 1979. He had his own dental practicefrom 1982 to 1992. He has substantial experience in the property sector having been involved with Arab-MalaysianDevelopment Berhad for many years as Project Coordinator. In 1992, he turned entrepreneur and began involvement inproperty sector with the incorporation of DRARD Holdings Sdn Bhd and several other property based companies. He is also theDirector of Mawar Delima Sdn Bhd, Azinal Sdn Bhd, Pasta Kemajuan Sdn Bhd and Pasta Holdings Sdn Bhd.

He is currently the President of the Negeri Sembilan Cycling Association and a Council Member of the Majlis PerbandaranSeremban.


BOARD OF DIRECTORS (cont’d)

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On behalf of the Board of Directors, I have great pleasure to present to you the inauguralissue of the Annual Report of Weida (M) Bhd and its group of companies ("Weida" or"the Group") for the financial year ended 31 March 2001.

Corporate ActivitiesThe Group submitted its listing proposal to the Securities Commission in February 2000for listing on the Second Board of the KLSE.

The approval for listing was obtained on 24 July, 2000.

It is gratifying to note that the shares of Weida were oversubscribed by 2.25 timesrepresenting RM 28.86 million in subscription monies from the public despite the thenbearish market sentiment.

The Company was listed on 28 February, 2001. The opening price registered a premiumof RM0.13 and the counter was actively traded on that day.

Financial ReviewThe financial year ended 31 March 2001 was a momentous year for Weida. The rights and public issue of shares pursuant toits public listing saw the Group raised RM 24.5 million in cash. The funds raised coupled with the cash generated from operatingactivities erased the Group’s net debt position of RM 21.3 million as at 31 March 2000 and allowed the Group to register anet cash position of RM 6.8 million as at 31 March 2001.

I am pleased to note that the Group’s turnover has increased 19% from RM 51.4 million for the year ended 31 March 2000 toRM 61.1 million for the year ended 31 March 2001. I am equally pleased to note that profit from ordinary activities before taxhas also increased by 19% from RM 6.7 million for the year ended 31 March 2000 to RM 8.0 million for the year ended 31March 2001 in tandem with the growth in turnover. Although, the Group has registered better performance against previousyear, the current year’s net profit attributable to shareholders was about 9% lower than the forecasted results due to delay incompletion of certain projects.

The management should be commended for maintaining a healthy net profit margin while achieving a 19% turnover growth.This is especially so in view of challenging market conditions resulting from slowing economic growth in the year ended 31March 2001 as compared to strong growth experienced in the year ended 31 March 2000 when the economy made a V-shaped recovery in the aftermath of the most severe economic crisis in Asian history.

Proposed DividendThe Board of Directors is pleased to recommend the payment of a first and final gross dividend of 5 sen per share on 40 millionordinary shares of RM1.00 each, less 28% income tax, amounting to RM 1.44 million in respect of the financial year ended 31March 2001, subject to the approval of the shareholders at the forthcoming Annual General Meeting.

Utilization of proceeds from the Allotment of shares, Rights issue and Public issueThe total proceeds raised amounted to RM24.507 million, of which RM6.4 million is for the construction of office buildings,showroom and acquisition of machinery, RM758,000 for acquisition of subsidiaries, RM7.734 million as working capital forthe Group, RM8.415 million for repayment of Group’s borrowings and RM1.2 million is for the payment of listing expenses.

I am pleased to report that as at 31 March 2001, the proceeds have been deployed except for RM5.9 million earmarked forthe construction of office buildings, showroom and acquisition of machinery. The Board has entrusted the management toconduct feasibility studies before deploying the resources. Appropriate disclosure would be made in due course.

CHAIRMAN’S STATEMENT


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Tuan Haji Su’ut Haji SuhailiCHAIRMAN

Current Year OutlookIn spite of the current slow pace of economic growth in general and sluggish performance by the property development,construction and infrastructure sectors in particular, I am quite optimistic that Weida will be able to maintain its sales andprofitability in the current year barring unforeseen circumstances and external shocks such as a sudden deterioration in theeconomy of the United States of America that would send tremours to the local economy. I have confidence in the ability ofWeida team to continue bringing innovative, new and improved products to market as well as to achieve greater marketpenetration besides identifying new markets. Besides streamlining the operations aimed at improving efficiency, costrationalization is being aggressively pursued.

Corporate GovernanceThe Board of Directors is committed to ensuring compliance the new Kuala Lumpur Stock Exchange and Code of CorporateGovernance.

In line with the best practices, I am pleased to report that the Board has initiated the setting up of the Audit Committee as wellas the Remuneration and Nomination Committees.

The Board will take a proactive approach in ensuring the group continues to align itself with the Code of Corporate Governance.

Director’ Responsibility in Financial ReportingThe Board of Directors do hereby state that the preparation of the financial statement set out on pages 12 to 48 are theresponsibility of the Directors.

Internal ControlThe Board of Directors acknowledges their responsibility for the group’s system of internal control to enhance shareholder’s valueand safeguard company’s asset.

AcknowledgementOn behalf of the Board of Directors, I would like to say a big ‘thank you’ to YAB Datuk Patinggi Tan Sri Haji Abdul Mahmud,the Chief Minister of Sarawak, for gracing Weida’s Underwriting Ceremony held at Hilton Hotel on 7 November 2000, whichpaved the way for the successful public listing of the Group.

I would also like to express our deepest appreciation to our valued customers, business associates, and shareholders for theirsupport, faith and confidence in the Group.

To all the various Government departments and agencies, thank you very much for the support and cooperation given to theGroup and look forward to your continuous support.

Last but not least, I would like to pay tribute to the management and staff of Weida for their dedication, commitment and hardwork without which the Group would not be as it is today. I am confident that they will continue to do so in future.

TUAN HAJI SU’UT HAJI SUHAILIChairman


CHAIRMAN’S STATEMENT (cont’d)

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ChairmanDatuk Dr Stalin Hardin(Independent Non-executive Director)

MembersTuan Haji Su’ut Haji Suhaili(Independent Non-executive Director)

Ahmad Tarmizi Bin Sulaiman(Non-executive Director)

Audit Committee & Terms of Reference

CompositionThe Committee shall be appointed by the Board and shall consist of not less than three (3) members of whom the majority shallbe independent Directors.

An alternate director shall not be appointed as a member of the Committee.

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

If the number of members of the Committee is reduced to below three (3), the Board shall within three (3) months appoint suchnumber of new members as may be required to make up the minimum of three (3) members.

AuthorityThe Committee shall, in accordance with a procedure to be determined by the Board and at the cost of the Company:-a) have the 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 Company;

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

e) be able to obtain independent professional or other advice; and

f) be able to convene meetings with the external auditors, excluding the attendance of the executive members of the Board, whenever deemed necessary.

DutiesThe duties and scope of the Committee shall be to review the following and report the same to the Board:-a) with the external auditors:

(i) the scope of their audit plan;(ii) their evaluation of the system of internal control;(iii) the audit reports on the financial statements;(iv) the assistance given by the Company’s employees to the external auditor;(v) any letter of resignation from the external auditors; and (vi) nomination of the external auditors and the determination of audit fees.

b) the effectiveness of the internal control systems including the internal audit programmes, process, results of internal audit programmes, processes or investigation undertaken and whether or not appropriate actions have been taken on recommendations of internal audit functions.

AUDIT COMMITTEE


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Duties (cont’d)

c) the quarterly results and year end financial statements of the Company and the Group, prior to submission to the Board, focusing particularly on:-(i) changes in or implementation of major accounting policy changes;(ii) significant and unusual events; and(iii) compliance with accounting standards and other legal requirements.

d) any related party transactions and conflict of interest situation that may arise within the Company or Group.

e) any other functions as may be agreed by the Committee and the Board or as may be required or empowered by statutory legislation or guidelines prepared by relevant governing authorities.

Where the Committee is of the view that any matter reported by it to the Board which has not been satisfactorily resolvedresulting in a breach of these Requirements, the Committee must promptly report such matter to the Exchange.

The Committee’s terms of office and performance is subject to review by the Board every three (3) years to determine whetherthe Committee has carried out their duties in accordance with the Terms of Reference.

Frequency and AttendanceThe Committee shall hold at least four (4) regular meetings a year and such additional meetings as the Chairman shall decidein order to fulfil its duties. The Committee may invite any person to any particular audit Committee meeting only at its invitation,specific to the relevant meeting.

A quorum of the Committee shall be two (2) members and majority of members present must be independent directors.

The Company Secretary shall be the Secretary of the Committee.

The minutes of the each meeting shall be tabled at the Board Meeting of the Company.

Reporting ProceduresThe secretary shall circulate the minutes of meetings of the Committee to all members of the Board.

Report by Audit CommitteeThe Audit Committee met twice during the year. In these meetings, the Committee carried out its duties in accordance with itsterms of reference.

Currently, the Group does not have an internal audit function. However, to discharge its duties, the Committee worked closelywith the external auditors. The recommendations from the external auditors are considered by the Committee forimplementation.

The Committee has decided to outsource the internal audit function and are currently reviewing various proposals. It is envisagedthat the appointment will commence in by September 2001.

The auditors remuneration for the financial year has been disclosed in Note 5 to the financial statements. No amount of non-audit fees has been paid to the external auditors for the financial year 31 March 2001.

DATUK STALIN HARDINChairmanAudit Committee


AUDIT COMMITTEE (cont’d)

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i) BOARD OF DIRECTORS ATTENDANCE RECORDThe Board of Directors met times during the financial year

Attendance to Board Meetings held Date of Date ofName of Directors 9-Oct-00 25-Oct-00 Nov-00 Feb-01 appointment resignation

Tuan Haji Su'ut Bin Haji Suhaili ✔ ✔ ✔ ✔ 25/10/00 N/A

Lee Choon Chin ✔ ✔ ✔ ✔ 25/10/00 N/A

Tuan Haji Zainal Abidin Bin Ahmad ✔ ✔ ✔ ✔ 25/10/00 N/A

Datu Voon Chen Hian@ Voon Chen Kok N/A ✕ ✔ ✕ 25/10/00 N/A

Ahmad Tarmizi Bin Sulaiman ✔ ✕ ✔ ✔ 25/10/00 N/A

Zaidi Bin Ahmad ✔ ✔ ✔ ✔ 25/10/00 N/A

Jee Hon Chong ✔ ✔ ✔ ✔ 25/10/00 N/A

Yong Lin Lin N/A ✔ ✔ ✔ 25/10/00 N/A

Datuk Dr. Stalin Hardin N/A ✔ N/A ✔ 13/12/00 N/A

YBhg Dato Abdul Rahiman Bin A S Dawood N/A ✔ N/A N/A 12/4/01 N/A

Chai Mui Huon ✔ ✕ N/A N/A 1st Director 11/1/00

Law Lee Koon ✔ ✕ N/A N/A 1st Director 11/1/00

N/A - Not Applicable✔ - Present✕ - Absent with apologies

ii) AUDIT COMMITTEE ATTENDANCE RECORDThe Audit Committee met times during the financial year

May-01 Jul-01

Datuk Dr. Stalin Hardin ✔ ✔

Tuan Haji Su'ut Bin Haji Suhaili ✔ ✔

Ahmad Tarmizi Bin Sulaiman ✔ ✔

✔ - Present✕ - Absent with apologies

iii) DIRECTORS' REMUNERATIONBreakdown of directors' remuneration for the year ended 31 March 2001, by category and in successive bands of RM50,000 are shown below :-

Remuneration (RM) Total Executive Non- executiveDirectors Directors

Fees (RM) nil nil nil

Salaries and Bonus (RM) 441,000 441,000 nil

(No. of Directors)

0 to RM50,000 1 1 nil

RM50,001 to RM100,000 nil

RM100,001 to RM150,000 3 3 nil

Total 4 4 nil

CORPORATE GOVERNANCE STATEMENT


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STATUTORYFINANCIAL

STATEMENTS


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13 Directors’ Report

18 Statement by Directors

18 Statutory Declaration

19 Report of the Auditors

20 Income Statements

21 Balance Sheets

23 Consolidated Statements of Changes In Equity

24 Company Statement of Changes In Equity

25 Cash Flow Statements

27 Notes to the Financial Statement

STATUTORY FINANCIAL STATEMENTS

The Directors are pleased to submit their annual report to the members together with the audited financial statements of theGroup and of the Company for the financial year ended 31 March 2001.

Principal activitiesThe principal activity of the Company is that of investment holding.

The principal activities of the Group consist of manufacturing, trading of high density polyethylene ("HDPE") engineeringproducts, provision of consultancy and specialised installation services and construction of water supply and other specialisedsystems involving the use of HDPE engineering products.

There was no significant change in the nature of these activities during the financial year.

Financial results

Group CompanyRM RM

Profit from ordinary activities after tax 7,078,869 2,788,268Minority interests (446,124) -

Net profit attributable to shareholders 6,632,745 2,788,268

DividendThe Directors now recommend the payment of a first and final gross dividend of 5 sen per share on 40,000,000 ordinaryshares, less income tax, amounting to RM1,440,000 in respect of the financial year ended 31 March 2001, subject to theapproval of members at the forthcoming Annual General Meeting of the Company.

Reserves and provisionsAll material transfers to or from reserves and provisions during the financial year are shown in the financial statements.

Issue of sharesThe changes in the issued and fully paid share capital of the Company during the financial year are as follows:

Date Purpose of issue Class of shares Number Terms of issue

23 October 2000 Working capital Ordinary shares 1,199,998 RM1.00 per shareof RM1

23 October 2000 Acquisition of Ordinary shares 22,993,045 RM1.45 per sharesubsidiary of RM1companies viashare swap

25 October 2000 Rights issue Ordinary shares 9,706,955 RM1.05 per shareof RM1

21 February 2001 Public issue Ordinary shares 6,100,000 RM2.15 per shareof RM1

DIRECTORS’ REPORT


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13

DirectorsThe Directors who have held office during the period since the date of the last report are as follows:

Tuan Haji Su’ut Bin Haji Suhaili (appointed on 25 October 2000)

Lee Choon Chin (appointed on 25 October 2000)

Tuan Haji Zainal Abidin Bin Ahmad (appointed on 25 October 2000)

Datu Voon Chen Hian @ Voon Chen Kok (appointed on 25 October 2000)

Ahmad Tarmizi Bin Sulaiman (appointed on 25 October 2000)

Zaidi Bin Ahmad (appointed on 25 October 2000)

Jee Hon Chong (appointed on 25 October 2000)

Yong Lin Lin (appointed on 25 October 2000)

Datuk Dr. Stalin Hardin (appointed on 16 December 2000)

YBhg Dato Abdul Rahiman Bin A S Dawood (appointed on 12 April 2001)

Chai Mui Huon (resigned on 1 November 2000)

Law Lee Koon (resigned on 1 November 2000)

Directors' benefitsDuring and at the end of the financial year, no arrangements subsisted to which the Company is a party, being arrangementswith the object or objects of enabling Directors of the Company to acquire benefits by means of the acquisition of shares in, ordebentures of, the Company or any other body corporate.

Since the end of the previous financial period, no Director has received or become entitled to receive a benefit (other thanDirectors’ remuneration as disclosed in Note 5 to the financial statements) by reason of a contract made by the Company or arelated corporation with the Director or with a firm of which he is a member, or with a company in which he has a substantialfinancial interest except for benefits arising from transactions as disclosed in Note 30 to the financial statements.

Directors' interests in sharesAccording to the register of Directors' shareholdings, particulars of interests of Directors who held office at the end of thefinancial year in shares in the Company are as follows:

Number of ordinary shares of RM1 eachAt At

1.4.2000 Bought Sold 31.3.2001

Direct interestTuan Haji Su’ut Bin Haji Suhaili - 10,000 - 10,000Lee Choon Chin - 1,412,273 - 1,412,273Jee Hon Chong - 360,568 - 360,568Yong Lin Lin - 430,682 - 430,682Zaidi Bin Ahmad - 10,000 - 10,000Ahmad Tarmizi Bin Sulaiman - 10,000 - 10,000Tuan Haji Zainal Abidin Bin Ahmad - 6,453,704 - 6,453,704Datu Voon Chen Hian @ Voon Chen Kok - 10,000 - 10,000Datuk Dr. Stalin Hardin - 10,000 - 10,000

Deemed interestLee Choon Chin * - 9,333,323 - 9,333,323

* Deemed interest by virtue of his substantial interest in Weida Management Sdn. Bhd. and his spouse’s (Liew Kee Moi) direct interest in the Company.


DIRECTORS’ REPORT (cont’d)

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Statutory information on the financial statementsBefore the income statements and balance sheets were made out, the Directors took reasonable steps:

(a) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of provision for doubtful debts and satisfied themselves that all known bad debts had been written off and that adequate provision had been made for doubtful debts; and

(b) to ensure that any current assets, other than debts, which were unlikely to realise in the ordinary course of business their values as shown in the accounting records of the Group and the Company had been written down to an amount which they might be expected so to realise.

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

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

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

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

No contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve monthsafter the end of the financial year which, in the opinion of the Directors, will or may substantially affect the ability of the Groupor the Company to meet their obligations when they fall due.

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

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

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

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

In the opinion of the Directors:

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

(b) except as disclosed in Note 33 to the financial statements, there has not arisen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely to affect substantially the results of the operations of the Group or the Company for the financial year in which this report is made.



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Significant event during the financial year

Listing exerciseIn conjunction with, and as an integral part of the listing of and quotation for its entire issued and paid-up share capital on theSecond Board of the Kuala Lumpur Stock Exchange ("KLSE"), the restructuring scheme which had been approved by theshareholders of the Company on 24 February 2000 and Securities Commission on 24 July 2000 is as follows:

(i) Allotment of sharesAllotment of 1,199,998 new ordinary shares of RM1.00 each of the Company at an issue price of RM1.00 per ordinaryshare to the existing shareholders.

(ii) Acquisitions of subsidiary companies(a) acquisition of the entire issued and paid-up share capital in Weida Integrated Industries Sdn. Bhd. ("WIISB") after

incorporating the revaluation of land and buildings of WIISB, for a purchase consideration of RM21,471,768 to be satisfied by the issue of 14,808,116 new ordinary shares of RM1.00 each of the Company at RM1.45 per ordinaryshare.

(b) acquisition of the entire issued and paid-up share capital of Weida Resources Sdn. Bhd. ("WRSB") for a purchase consideration of RM11,314,780 to be satisfied by the issue of 7,803,297 new ordinary shares of RM1.00 each of theCompany at RM1.45 per ordinary share.

(c) acquisition of the entire issued and paid-up share capital of Weida Works Sdn. Bhd. (formerly known as Weida Holdings Sdn. Bhd.) ("WHSB") for a purchase consideration of RM553,367 to be satisfied by the issue of 381,632 newordinary shares of RM1.00 each of the Company at RM1.45 per ordinary share.

(d) acquisition of 51% of the issued and paid-up share capital of Weida Marketing Sdn. Bhd. ("WMSB") for a cashconsideration of RM255,000.

(e) acquisition of 70% of the issued and paid-up share capital of Weidaya Sdn. Bhd. ("Weidaya") for a cash consideration of RM350,000.

(f) acquisition of 51% of the issued and paid-up share capital of Weida Environmental Technology Sdn. Bhd. ("WETSB") for a cash consideration of RM51,000.

(g) acquisition of 51% of the issued and paid-up share capital of Saruwas Sdn. Bhd. ("Saruwas") for a cash consideration of RM102,000.

The above allotment of shares and acquisition of subsidiary companies were completed on 23 October 2000.

(iii) Rights issueRights issue of 9,706,955 new ordinary shares of RM1.00 each of the Company on the basis of approximately forty (40) new ordinary shares for every one hundred (100) existing ordinary shares held at an issue price of RM1.05 per ordinaryshare, completed on 25 October 2000.



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Listing exercise (cont’d)

(iv) Public issuePublic issue of 6,100,000 new ordinary shares of RM1.00 each of the Company at an issue price of RM2.15 per ordinaryshare, completed on 21 February 2001.

(v) Listing on the Second Board of the Kuala Lumpur Stock ExchangeThe entire issued and fully paid-up share capital of the Company of RM40,000,000 comprising 40,000,000 ordinaryshares of RM1.00 each were successfully listed on the Second Board of the KLSE on 28 February 2001.

AuditorsThe auditors, PricewaterhouseCoopers, have expressed their willingness to continue in office.

In accordance with a resolution of the Board of Directors dated 2 July 2001

TUAN HAJI SU’UT BIN HAJI SUHAILI LEE CHOON CHINCHAIRMAN MANAGING DIRECTOR

Kuching



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We, Tuan Haji Su’ut Bin Haji Suhaili and Lee Choon Chin, two of the Directors of Weida (M) Bhd., state that, in the opinion ofthe Directors, the financial statements set out on pages 20 to 48 are drawn up so as to give a true and fair view of the state ofaffairs of the Group and Company as at 31 March 2001 and of the results and cash flows of the Group and Company for thefinancial year ended on that date in accordance with the applicable approved accounting standards in Malaysia and theprovisions of the Companies Act, 1965.

In accordance with a resolution of the Board of Directors dated 2 July 2001

TUAN HAJI SU’UT BIN HAJI SUHAILI LEE CHOON CHINCHAIRMAN MANAGING DIRECTOR

Kuching

I, Lee Choon Chin, the Director primarily responsible for the financial management of Weida (M) Bhd., do solemnly andsincerely declare that the financial statements set out on pages 20 to 48 are, to the best of my knowledge and belief, correct,and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the provisions of the StatutoryDeclarations Act, 1960.

Subscribed and solemnly declared by the abovenamed Lee Choon Chin at Kuching, Sarawak on 2 July 2001,

before me,

MICHAEL ONG KEE TUANCommissioner for Oaths


STATEMENT BY DIRECTORS

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18

PURSUANT TO SECTION 169(15) OF THE COMPANIES ACT, 1965

STATUTORY DECLARATIONPURSUANT TO SECTION 169(16) OF THE COMPANIES ACT, 1965

We have audited the financial statements set out on pages 20 to 48. These financial statements are the responsibility of theCompany’s Directors. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with approved auditing standards in Malaysia. Those standards required that we planand perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. Anaudit also includes assessing the accounting principles used and significant estimates made by the Directors, as well asevaluating the overall financial statements presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion:(a) the financial statements have been prepared in accordance with the provisions of the Companies Act, 1965 and applicable

approved accounting standards in Malaysia so as to give a true and fair view of:

(i) the matters required by Section 169 of the Companies Act, 1965 to be dealt with in the financial statements; and

(ii) the state of affairs of the Group and Company as at 31 March 2001 and of the results and cash flows of the Group and Company for the financial year ended on that date;

and

(b) the accounting and other records and the registers required by the Act to be kept by the Company and its subsidiarycompanies have been properly kept in accordance with the provisions of the Act.

We are satisfied that the financial statements of the subsidiary companies that have been consolidated with the Company’sfinancial statements are in form and content appropriate and proper for the purposes of the preparation of the consolidatedfinancial statements and we have received satisfactory information and explanations required by us for those purposes.

Our reports on the financial statements of the subsidiary companies were not subject to any qualification and did not includeany comment made under subsection 3 of Section 174 of the Act.

PRICEWATERHOUSECOOPERS(No. AF: 1146)Public Accountants

YAP KIM SWEE(No. 1654/10/02 (J))Partner of the firm

Kuching2 July 2001

REPORT OF THE AUDITORS


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19

TO THE MEMBERS OF WEIDA (M) BHD. (Company No. 504747-W)

ProformaGroup Group Company

Financial periodfrom 3.2.2000

Financial Financial Financial (date ofyear ended year ended year ended incorporation)

Note 31.3.2001 31.3.2000 31.3.2001 to 31.3.2000RM RM RM RM

Revenue 4 61,129,718 51,368,247 3,933,404 -Other operating income 730,630 308,233 - -Changes in inventories 1,669,111 1,772,769 - -Raw materials and

consumables used (21,218,272) (17,915,736) - -Purchase of finished

goods (7,476,301) (6,165,385) - -Work performed and

capitalised 351,714 711,068 - -Staff cost (6,981,471) (6,234,242) - -Depreciation (3,357,728) (3,131,892) - -Contractors fee (5,486,047) (4,828,231) - -Amortisation of goodwill/

reserves 18,857 - - -Transportation charges (2,919,669) (2,370,314) - -Revaluation deficits (1,058,800) - - -Other operating expenses (6,057,342) (4,979,639) (44,269) (49,299)

Profit/(loss) from operations 5 9,344,400 8,534,878 3,889,135 (49,299)Finance cost 6 (1,371,472) (1,836,742) - -Share of result of an

associated company 913 1,796 - -

Profit from ordinaryactivities before tax 7,973,841 6,699,932 3,889,135 (49,299)

Tax 7 (894,772) (515,468) (1,100,867) -Share of tax of an associated

company (200) - - -

Profit from ordinary activitiesafter tax 7,078,869 6,184,464 2,788,268 (49,299)

Minority interests (446,124) - - -

Net profit attributable toshareholders 6,632,745 6,184,464 2,788,268 (49,299)

Earnings per share (sen)- basic 8 21.7 23.0

Dividend per share (sen) 9 5.0 - 5.0 -


INCOME STATEMENTS

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20

FOR THE FINANCIAL YEAR ENDED 31 MARCH 2001

The notes on pages 27 to 48 form part of these financial statements.


Note 2001 2000 2001 2000RM RM RM RM

Non current assetsProperty, plant and equipment 10 39,210,759 34,765,100 - -Subsidiary companies 11 - - 23,751,045 -Associated company 12 38,765 38,052 - -Other investments 13 - 758,000 - -Intangible assets 14 152,868 253,020 - 253,020

39,402,392 35,814,172 23,751,045 253,020

Current assetsInventories 15 14,087,751 12,078,723 - -Properties held for resale 17 267,347 - - -Dividend receivables - - 2,802,000 -Receivables, deposits and

prepayments 19 16,432,905 20,406,926 9,369,632 -Deposits, bank and cash

balances 20 20,580,000 4,056,780 12,604,305 2

51,368,003 36,542,429 24,775,937 2

Current liabilitiesProvision for liabilities 21 624,999 311,064 - -Payables and accruals 22 7,545,093 10,666,203 258,256 302,319Tax 2,172,245 3,497,288 8,200 -Proposed dividend - 4,000,000 - -Borrowings (secured) 23 9,813,653 9,533,466 - -Bank overdrafts (secured) 24 3,916,002 6,593,817 - -

24,071,992 34,601,838 266,456 302,319

Net current assets/(liabilities) 27,296,011 1,940,591 24,509,481 (302,317)

66,698,403 37,754,763 48,260,526 (49,297)

BALANCE SHEETS


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AS AT 31 MARCH 2001


Note 2001 2000 2001 2000RM RM RM RM

Capital and reservesShare capital 25 40,000,000 22,993,047 40,000,000 2Share premium 5,671,557 150,000 5,521,557 -Revaluation reserve 7,140,098 - - -Retained earnings 26 28,393,736 21,760,991 2,738,969 (49,299)Reserve on acquisition 1,265,403 - - -Merger deficit (16,983,045) (16,983,045) - -

Shareholders’ equity 65,487,749 27,920,993 48,260,526 (49,297)Minority interest 1,103,112 - - -

66,590,861 27,920,993 48,260,526 -

Non current liabilitiesDeferred taxation 27 32,000 620,000 - -Borrowings 23 75,542 9,213,770 - -

66,698,403 37,754,763 48,260,526 (49,297)


BALANCE SHEETS (cont’d)

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AS AT 31 MARCH 2001

CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY


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23



COMPANY STATEMENT OF CHANGES IN EQUITY

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24



Note 2001 2000 2001 2000RM RM RM RM

Operating activitiesNet profit/(loss) attributable

to shareholders 6,632,745 6,184,464 2,788,268 (49,299)

Adjustments for:Dividend income - - (3,891,667) -Depreciation of property,

plant and equipment 3,357,728 3,131,892 - -(Gain)/loss on disposal of

property, plant andequipment (483,289) (800) - -

Property, plant andequipment written off 39,292 40,799 - -

Revaluation deficit 1,058,800 - - -Amortisation of goodwill

on consolidation 2,591 - - -Amortisation of reserve on

consolidation (21,448) - - -Interest expenses 1,371,472 1,836,742 - -Interest income (203,359) (108,093) (41,737) -Share of profit of associated

company (913) (1,796) - -Tax 894,972 515,468 1,100,867 -Minority interest 446,124 - - -

13,094,715 11,598,676 (44,269) (49,299)

(Increase)/decrease inworking capital:

Inventories (52,917) (3,753,150) - -Receivables 12,298,059 (10,371,628) (9,369,632) -Provisions for liabilities 313,935 311,064 - -Payables (12,149,211) 2,084,566 (44,063) 302,319

13,504,581 (130,472) (9,457,964) 253,020

Listing expenses paid (1,725,771) (253,020) (1,725,771) (253,020)Interest paid (1,145,269) (1,349,793) - -Interest received 203,359 108,093 41,737 -Tax paid (3,060,921) (1,330,531) (3,000) -

Net cash flow fromoperating activities 7,775,979 (2,955,723) (11,144,998) -

CASH FLOW STATEMENTS


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Note 2001 2000 2001 2000RM RM RM RM

Investing activitiesProceeds from disposal

of property, plant andequipment 2,083,799 4,613 - -

Proceeds from sale ofproperties held for resale 148,616 - - -

Purchase of property,plant and equipment (2,686,576) (3,056,152) - -

Purchase of subsidiarycompanies 28 601,083 - (758,000) -

Net of (placement)/withdrawal of fixeddeposits (486,441) 1,442,903 - -

Net cash flow frominvesting activities (339,519) (1,608,636) (758,000) -

Financing activitiesProceeds from issuance of shares 24,507,301 2 24,507,301 2Dividends paid (4,000,000) - - -Repayments of term loans (8,326,286) (521,865) - -Repayments of hire

purchase and finance lease (3,776,881) (2,128,797) - -Net of drawdown and

repayment of bankersacceptance 2,874,000 2,177,249 - -

Net cash flow fromfinancing activities 11,278,134 (473,411) 24,507,301 2

Changes in cash andcash equivalents 18,714,594 (5,037,770) 12,604,303 2

Cash and cashequivalents at beginningof the financial year (3,294,083) 1,743,687 2 -

Cash and cashequivalents at end ofthe financial year 29 15,420,511 (3,294,083) 12,604,305 2


CASH FLOW STATEMENT (cont’d)

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1 General informationThe principal activity of the Company is that of investment holding.

The principal activities of the Group consist of manufacturing, trading and marketing of HDPE engineering products, specialised installation services and construction of water supply and other specialised systems involving the use of HDPE engineering products.

The number of employees at the end of the financial year amounted to 379 (2000: 334) employees in the Group/Proforma Group. There is no employee at end of the financial year in the Company.

The Company is a private limited company and is incorporated and domiciled in Malaysia, and listed on the Second Boardof the Kuala Lumpur Stock Exchange.

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

No. 187, Lorong Datuk Abang Abdul Rahim 7, 93450 Kuching, Sarawak, Malaysia

2 Basis of preparationThe financial statements of the Group and the Company have been prepared under the historical cost convention (as modified for the revaluation of land and buildings) and comply with the applicable approved accounting standards in Malaysia and the provisions of the Companies Act, 1965.

The preparation of financial statements in conformity with the applicable approved accounting standards and the provisions of the Companies Act require the Directors to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reported financial year. Actual results could differ from those estimates.

3 Summary of significant accounting policiesThe following accounting policies have been used consistently in dealing with items which are considered material in relation to the financial statements.

(a)ConsolidationThe consolidated financial statements include the financial statements of the Company and all its subsidiary companies made up to the end of the financial year. Subsidiary companies are those companies in which the Group has power to exercise control over the financial and operating policies so as to obtain benefits from their activities.

Subsidiary companies are consolidated from the date on which control is transferred to the Group and are no longer consolidated from the date that control ceases. Subsidiary companies are consolidated using the acquisition method of accounting except for three subsidiary companies which are consolidated using the merger method of accounting inaccordance with Malaysia Accounting Standard No. 2 "Accounting for Acquisition and Mergers", as disclosed in Note28 to the financial statements.

Under the acquisition method of accounting, the results of subsidiary companies acquired or disposed of during the financial year are included from the date of acquisition up to the date of disposal. At the date of acquisition, the fair values of the subsidiary companies’ net assets are determined and these values are reflected in the consolidated financial statements. The difference between the acquisition cost and the fair values of the subsidiary companies’ net assets is reflected as goodwill or reserve on consolidation.

Under the merger method of accounting, the results of the subsidiary companies are presented as if the merger had been effected throughout the current and previous financial years. On consolidation, the difference between the carrying value of investment over the nominal value of the shares acquired is taken to merger reserve.

The 2000 Proforma Group financial statements are presented as if the Company had been incorporated on 1 April 1999 and the merger had been effected on that date. The presentation of the 2000 Proforma Group financial statements is to comply with Malaysian Accounting Standard No. 2 "Accounting for Acquisitions and Mergers".

NOTES TO THE FINANCIAL STATEMENTS


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27

3 Summary of significant accounting policies (cont’d)

(b)Goodwill/reserve on consolidationGoodwill/reserve on consolidation represents the difference between the fair value of purchase consideration of subsidiary companies acquired over the Group’s share of the fair values of their separable net assets at the date of acquisition. Goodwill or reserve arising on consolidation is amortised or credited on a straight-line basis to the income statements over the period of 25 years.

The carrying amount of goodwill is reviewed annually and written down for permanent impairment where it is considered necessary.

(c) Investment in subsidiary companiesInvestment in subsidiary companies is shown at cost and provision is only made where, in the opinion of the Directors, there is a permanent diminution in value. Permanent diminution in the value of an investment is recognised as an expense in the period in which the diminution is identified.

(d)Investment in associated companyInvestment in associated company is stated at cost and provision is only made where, in the opinion of the Directors, there is a permanent diminution in value. Permanent diminution in value of an investment is recognised as an expense in the period in which the diminution is identified. An associated company is a company which the Company exercises significant influence. Significant influence is the power to participate in the financial and operating policy decisions of the associated company but not control over those policies.

(e) Property, plant and equipmentProperty, plant and equipment are stated at cost less accumulated depreciation.

However, during the financial year, the Group and the Company have changed their accounting policy in respect of land and buildings from stating such assets at cost less accumulated depreciation to that of stating such assets at valuation performed by external independent valuers based on open market value, at five yearly intervals, less any subsequent accumulated depreciation.

Increases in the carrying amount arising on revaluation are credited to revaluation reserves in shareholders’ equity.Decreases that offset previous increases of the same assets are charged against the revaluation reserves; all other decreases are charged to the income statements.

Freehold land is not amortised as it is deemed to have an indefinite life. The cost of leasehold land is amortised in equal installments over the periods of the respective leases that range from 41 to 60 years.

Other property, plant and equipment is depreciated on a straight line basis to write off the cost of each asset over their estimated useful lives at the following annual rates:

Long term leasehold land and buildings 2%Buildings 2%Plant, machinery and moulds 10% - 331/3%Office equipment, furniture and fittings 10% - 20%Equipment and tools 12% - 20%Electrical installation and renovation 10%-15%Motor vehicles 20%Infrastructure 5%Renovation 10% - 20%Signboard 20%

Depreciation on capital work-in-progress commences when the property, plant and equipment are ready for their intended use.

Where the carrying amount of an asset is greater than its estimated recoverable amount, it is written down immediately to its recoverable amount.

Gains and losses on disposal of property, plant and equipment are determined by reference to their carrying amounts and are taken into account in determining profit from operations.


NOTES TO THE FINANCIAL STATEMENTS (cont’d)

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(f) Properties held for resaleProperties held for resale are stated at lower of cost and net realisable value.

(g) Inventories and work-in-progressInventories are stated at the lower of cost and net realisable value. Cost is determined using the first in, first out method.

Cost of finished goods includes where relevant, appropriate proportion of production overheads and is determined on the weighted-average basis while cost of raw materials is determined using first in, first out method.

Work-in-progress is stated at cost less progress billings received and receivable. Cost of work-in-progress includes cost of goods delivered and where relevant, appropriate proportion of installation charges. Provision is made for anticipated loss.

The aggregate of the costs incurred on work-in-progress is compared against the progress billings up to the year end. Where costs incurred exceed progress billings, the balance is shown as amounts due from customers on work-in-progress under trade and other receivables. Where progress billings exceed costs incurred, the balance is shown as amounts due to customers on work-in-progress under trade and other payables.

Net realisable value is the estimate of the selling price in the ordinary course of business, less the costs of completion and selling expenses.

(h) Contract work-in-progressWhen the outcome of a contract cannot be estimated reliably, contract revenue is recognised only to the extent of contract costs incurred that it is probable will be recoverable and contract costs are recognised as expenses.

When the outcome of a contract can be estimated reliably, contract revenue and contract cost are recognised over the period of the contract as revenue and expenses respectively. The Group uses the percentage of completion method to determine the appropriate amount of revenue and costs to recognise in a given period; the stage of completion ismeasured by reference to the surveys of work performed. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

The aggregate of the costs incurred and the profit/loss recognised on each contract is compared against the progress billings up to the financial year end. Where costs incurred and recognised profits (less recognised losses) exceed progress billings, the balance is shown as amounts due to customers on contracts under trade and other receivables.

When progress billings exceeds cost incurred plus recognised profits (less recognised losses), the balance is shown as amounts due to customers on contracts under trade and other payables.

(i) Preliminary and pre-operating expensesPreliminary and pre-operating expenses are charged to the income statement when incurred.

(j) Deferred taxationProvision is made using the liability method in respect of timing differences between accounting and taxable profits. Debit balances in the deferred taxation account are not recognised unless there is reasonable certainty of its realisation in the foreseeable future.

(k) Foreign currenciesForeign currency transactions are accounted for at exchange rates ruling at the transaction dates, unless hedged by forward foreign exchange contracts, in which case the rates specified in such forward contracts are used. Foreign currency monetary assets and liabilities are translated at exchange rates ruling at balance sheet date, unless hedged by forward foreign exchange contracts, in which case the rates specified in such forward contracts are used. Exchange differences arising from the settlement of foreign currency transactions and from the translation of foreign currency monetary assets and liabilities are included in the income statement.



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(k) Foreign currencies (cont’d)

The principal closing rates used in translation of foreign currency amounts were as follows:

Foreign currency 2001 2000RM RM

1 USD 3.826 3.826100 LIRE 0.191 0.207

(l) Hire purchase and finance lease creditorsLeases of assets where the Company assumes substantially all the benefits and risks of ownership are classified as finance leases.

Property, plant and equipment acquired under hire purchase agreements are capitalised and depreciated and the corresponding obligations treated as liabilities. Finance charges are allocated to the income statement over the hirepurchase periods to give a constant period rate of interest on the remaining liabilities.

The property, plant and equipment acquired under hire purchase and finance lease contracts is depreciated over the useful life of the asset.

(m)ProvisionsEstimated liability on all projects still under warranty at the balance sheet date is recognised in the period in which the provision is made.

(n) Trade receivablesTrade receivables are carried at anticipated realisable value. Bad debts are written off in the period in which they areidentified. An estimate is made for doubtful debtors based on a review of all outstanding amounts at the period end.

(o) Cash and cash equivalentsCash and cash equivalents comprise cash in hand, bank balances, bank overdrafts, fixed deposits with licensed banks and short term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value except for fixed deposits pledged for banking facilities.

(p) Revenue recognitionRevenue from the sale of products is recognised upon delivery of goods and acknowledgement of acceptance by customers, net of sales taxes and discounts.

Revenue from the sale of sewage treatment system is recognised upon completion of installation and commissioning of the sewage treatment system.

Revenue relating to contracts are accounted for under the percentage of completion method. Foreseeable losses on contracts are provided in full.

Management fee is recognised upon certification of services rendered.

Interest income is recognised based on accrual basis unless collectability is in doubt.

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



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4 RevenueProforma

Group Group CompanyFinancial period

from 3.2.2000Financial Financial Financial (date of

year ended year ended year ended incorporation)31.3.2001 31.3.2000 31.3.2001 to 31.3.2000

RM RM RM RM

Sales of goods 49,643,484 42,977,083 - -Sales of sewage systems 1,793,775 204,000 - -Contract revenue 9,650,722 8,187,164 - -Interest income 41,737 - 41,737 -Dividend income - - 3,891,667 -

61,129,718 51,368,247 3,933,404 -

5 Profit/(loss) from operationsThe following items have been charged/(credited) in arriving at profit/(loss) from operations:


Financial periodfrom 3.2.2000

Financial Financial Financial (date ofyear ended year ended year ended incorporation)31.3.2001 31.3.2000 31.3.2001 to 31.3.2000

RM RM RM RM

Auditors’ remuneration- current year 74,500 43,500 20,500 500Cost of inventories recognised

as expense 45,243,754 38,235,778 - -Cost of services rendered 58,512 - - -Directors' remuneration- fees 24,000 24,000 - -- emoluments 372,960 342,986 10,080 -Preliminary and pre-operating

expenses written off - 48,799 - 48,799Property, plant and equipment

written off 39,292 40,799 - -Rental of buildings 199,873 93,610 - -Rental of motor vehicle 1,575 - - -Rental of office equipment 2,250 - - -Amortisation of goodwill on consolidation 2,591 - - -Provision for doubtful debts 293,773 379,100 - -Write back of provision for doubtful debts (136,898) - - -Gain on disposal of property, plant

and equipment (483,289) (800) - -Amortisation of reserve on

consolidation (21,448) - - -Interest income (203,359) (108,093) (41,737) -Net gain on foreign exchange- realised (2,542) (12,983) - -Rental income (37,620) - - -



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6 Finance costProforma

Group GroupFinancial Financial

year ended year ended31.3.2001 31.3.2000

RM RM

Interest expenses from:Term loans 503,875 827,926Hire purchase and finance lease 226,203 486,949Bank overdrafts 225,081 181,417Bankers’ acceptance 347,255 300,047Bank guarantees 13,626 -Others 55,432 40,403

1,371,472 1,836,742

7 TaxProforma

Group Group CompanyFinancial period

from 3.2.2000Financial Financial Financial (date of

year ended year ended year ended incorporation)31.3.2001 31.3.2000 31.3.2001 to 31.3.2000

RM RM RM RM

Current financial year 1,441,983 788,379 1,100,867 -Under provision in prior financial

years 40,789 37,089 - -Deferred taxation (588,000) (310,000) - -

894,772 515,468 1,100,867 -

The effective tax rate of the Company is higher than the statutory tax rate due to certain expenses were not deductible for tax purposes.

The effective tax rate of the Group is lower than the statutory tax rate due to the tax savings arising from the utilisation of reinvestment allowances and capital allowances by a subsidiary company.



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8 Earnings per shareBasic earnings per share is calculated by dividing the net profit attributable to shareholders of RM6,632,745 (financial year ended 31.3.2000: RM6,184,464) and on the weighted average number of ordinary shares in issue during the financial year of 30,589,283 (financial year ended 31.3.2000: 26,901,865).

9 DividendsProposed dividends in the Proforma Group for the financial year ended 31 March 2000 represent dividends proposed by two subsidiary companies prior to the restructuring exercise as disclosed in Note 28 to the financial statements.

Dividend proposed in the Company for the financial year ended 31 March 2001 is as follows:Financial period from

3.2.2000 (date ofFinancial year ended incorporation)

31.3.2001 to 31.3.2000Amount of Amount of

Gross dividend Gross dividendper share net of tax per share net of tax

Sen RM Sen RM

Proposed final dividend 5.0 1,440,000 - -

At the forthcoming Annual General Meeting, a final gross dividend in respect of the financial year ended 31 March 2001 of 5 sen per share (2000: Nil), net of tax, amounting to RM1,440,000 (2000: Nil) will be proposed for shareholders’ approval. These financial statements do not reflect this final dividend which will be accounted for in shareholders’ equity as an appropriation of retained earnings in the financial year ending 31 March 2002 when approved by shareholders.



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10 Property, plant and equipment (cont’d)

Net book value of assets pledged as security for bank borrowings:Proforma

Group Group2001 2000

RM RM

Freehold land 1,656,512 2,332,692Short term leasehold land 1,258,334 6,028,762Buildings 2,385,004 8,672,091

5,299,850 17,033,545

Net book value of assets under hire purchase and finance lease agreements:

ProformaGroup Group2001 2000

RM RM

Plant and machinery - 4,837,572Motor vehicles 131,661 241,431

131,661 5,079,003

The title to a parcel of leasehold land and a parcel of freehold land are in the process of being transferred to a subsidiarycompany.

The valuation of freehold and leasehold land and buildings were made by the Directors during the financial year based ona valuation by independent professional valuers on the open market basis.

The tax effect in connection with the surplus arising on revaluation of the freehold and leasehold land and buildings is notdisclosed as there is no foreseeable intention to dispose of these properties.

Had these property, plant and equipment been included in the financial statements at cost less accumulated depreciation,the net book value of each class of property, plant and equipment as at 31 March 2001 would have been as follows:

Group2001

RM

Freehold land 2,332,692Short term leasehold land 4,965,655Buildings 10,371,192Capital work-in-progress 432,506Plant, machinery and moulds 9,623,299Office equipment, furniture and fittings 578,682Equipment and tools 997,192Motor vehicles 379,035Electrical installation and renovation 148,745Infrastructure 1,479,689

31,308,687



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11 Subsidiary companiesProforma

Group Group Company2001 2000 2001 2000

RM RM RM RM

Unquoted shares, at cost - - 23,751,045 -

The shares of all subsidiary companies are held directly by the Company. Details of the subsidiary companies are as follows:

Effective interestCountry of Proforma

Name incorporation Group Group Principal activities2001 2000

% %

Weida Integrated Industries Malaysia 100 100 Manufacturing of HDPESdn. Bhd. engineering products

Weida Resources Sdn. Bhd. Malaysia 100 100 Trading of HDPEengineering products,fittings and other engineering products

Weida Works Sdn. Bhd. Malaysia 100 100 Construction of water(formerly known as Weida supply and otherHoldings Sdn. Bhd.) specialised systems

involving the use ofHDPE engineeringproducts

Saruwas Sdn. Bhd. Malaysia 51 - Project managementservices

Weida Marketing Sdn. Bhd. Malaysia 51 - Trading of HDPEengineering products andthe provision ofspecialised installationservices

Weida Environmental Malaysia 51 - To provide sewageTechnology Sdn. Bhd. treatment services

comprising the design,supply and installation,commissioning andmaintenance of sewagesystems

Weidaya Sdn. Bhd. Malaysia 70 - Trading of HDPEproducts and theprovision of specialisedinstallation services



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12 Associated companyProforma


RM RM

Unquoted shares, at cost 40,000 40,000Share of post acquisition losses (1,235) (1,948)

38,765 38,052

Represented by:Share of net assets of an associated company 38,765 38,052

The shares of the associated company are held through a subsidiary company. Details of the associated company are as follows:

Effective interestCountry of Proforma

Name incorporation Group Group Principal activities2001 2000

% %

Weidasar Sdn. Bhd. Malaysia 40 40 General trading andproject management

13 Other investmentsProforma


RM RM

Unquoted shares, at cost - 758,000

14 Intangible assetsGoodwill on Deferred

Proforma Group consolidation expenditure TotalRM RM RM

At 1 April 1999 - - -Additions during the financial year - 253,020 253,020

At 31 March 2000 - 253,020 253,020

Group

At 1 April 2000 - 253,020 253,020Acquisition of subsidiary companies (Note 28) 155,459 - 133,997Additions during the financial year - 1,725,771 1,725,771Amortisation charge (Note 5) (2,591) - (2,233)Written off to share premium - (1,978,791) (1,978,791)

At 31 March 2001 152,868 - 131,764



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14 Intangible assets (cont’d)

Goodwill on DeferredProforma Group consolidation expenditure Total

RM RM RM

Company

At 3.2.2000 (date of incorporation) - - -Additions during the financial period - 253,020 253,020

At 31 March 2000 - 253,020 253,020

At 1 April 2000 - 253,020 253,020Additions during the financial year - 1,725,771 1,725,771Written off to share premium - (1,978,791) (1,978,791)

At 31 March 2001 - - -

The deferred expenditure represents share issue expenses incurred in connection with the rights and public issues.

These expenses are written off against share premium arising from the rights and public issue of shares.

15 InventoriesProforma


RM RMAt cost:

Raw materials 5,695,059 5,209,774Finished goods 8,326,339 6,815,101

14,021,398 12,024,875

At net realisable value:Finished goods 66,353 53,848

14,087,751 12,078,723

16 Work-in-progressProforma


RM RMWork-in-progress 3,288,947 -Less: Progress billings (2,287,764) -

1,001,183 -

Amounts due from customers on work-in-progress (Note 19) 1,001,183 -



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17 Properties held for resaleProperties held for resale represent properties received in exchange for settlement of trade receivables, and are held with a view to realisation in cash.

18 Contract work-in-progressProforma


RM RM RM RMCost incurred to date 14,562,248 9,396,957 - -Attributable profits 994,058 1,248,298 - -

15,556,306 10,645,255 - -Progress billings received

and receivables (14,692,151) (9,785,822) - -

864,155 859,433 - -

Amounts due from customerson contracts (Note 19) 864,155 859,433 - -

Retention on contracts 710,428 359,068 - -

19 Receivables, deposits and prepaymentsProforma


RM RM RM RMTrade receivables 16,434,562 19,389,997 - -Less: Provision for doubtful debts (2,576,985) (846,052) - -

13,857,577 18,543,945 - -

Other receivables 471,642 683,235 - -Less: Provision for doubtful debts (168,294) (79,165) - -

303,348 604,070 - -

Amounts due from subsidiarycompanies - - 9,369,632 -

Amounts due from customers onwork-in-progress (Note 16) 1,001,183 - - -

Amount due from customers oncontracts (Note 18) 864,155 859,433 - -

Deposits 157,328 174,663 -Prepayments 131,477 224,815 - -Tax recoverable 117,837 - - -

16,432,905 20,406,926 9,369,632 -



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20 Deposits, bank and cash balancesProforma


RM RM RM RMFixed deposits with licensed banks 17,935,929 3,011,640 12,600,000 -Bank and cash balances 2,644,071 1,045,140 4,305 2

20,580,000 4,056,780 12,604,305 2

Fixed deposits with licensed banks,which are pledged for certain

banking facilities for:- the Company 1,191,832 717,663 - -- third parties 51,655 39,383 - -

1,243,487 757,046 - -

21 Provision for liabilities

Proforma Group 2001RM

At 1 April 1999 -Additions 311,064Utilised during the financial year -

At 31 March 2000 311,064

Group

At 1 April 2000 311,064Additions 316,210Utilised during the financial year (2,275)

At 31 March 2001 624,999

Provision for liabilities represents provision for warranty claims in respect of the contracts.

22 Payables and accrualsProforma


RM RM RM RMTrade payables 3,953,047 4,063,082 - -Other payables 2,215,873 2,314,772 237,756 301,819Amounts due to Directors - 3,163,371 - -Accruals 1,376,173 1,124,978 20,500 500

7,545,093 10,666,203 258,256 302,319



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23 Borrowings (secured)Proforma


RM RM RM RMCurrentTerm loans - 1,063,855 - -Hire purchase and finance lease 27,653 1,557,611 - -Bankers’ acceptance 9,786,000 6,912,000 - -

9,813,653 9,533,466 - -

Non currentTerm loans - 7,262,431 - -Hire purchase and finance lease 75,542 1,951,339 - -

75,542 9,213,770 - -

Term loansTerm loans are repayable over

the following periods:- not later than 1 year - 1,063,855 - -- later than 1 year and not later

than 5 years - 4,960,770 - -- later than 5 years - 2,301,661 - -

- 8,326,286 - -

Representing term loans:- current - 1,063,855 - -- non current - 7,262,431 - -

- 8,326,286 - -

The above term loans includethe followings:

Term loan I - 1,136,261 - -Term loan II - 1,589,558 - -Term loan III - 5,524,940 - -

- 8,250,759 - -



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23 Borrowings (secured) (cont’d)

Term loan I was secured by way of first legal charge over a subsidiary company’s freehold land, certain leasehold land and a building and are jointly and severally guaranteed by certain Directors of the subsidiary company. It wasrepayable over 96 equal monthly installments.

Term loan II was secured by way of first legal charge over a subsidiary company’s leasehold land and building and arejointly and severally guaranteed by certain Directors of the subsidiary company. It was repayable over 120 equal monthly installments.

Term loan III was secured by way of first legal charge over a subsidiary company’s leasehold land and building, a bank guarantee of RM849,000 from another financial institution and are jointly and severally guaranteed by certain Directors of the subsidiary company. It was repayable over 96 equal monthly installments.

Interest was incurred during the financial year at rates ranging from 8.30% to 9.75% (financial year ended 31.3.2000: 8.80% to 13.80%) per annum.

ProformaGroup Group Company2001 2000 2001 2000

RM RM RM RMHire purchase and finance

lease creditorsAnalysis of hire purchase and

finance lease commitments:- not later than 1 year 37,848 1,859,739 - -- later than 1 year and not later

than 5 years - 1,371,867 - -- later than 5 years 85,128 758,307 - -

122,976 3,989,913Less: Finance charges (19,781) (480,963) - -

103,195 3,508,950 - -

Representing hire purchase andfinance lease liabilities:

- current 27,653 1,557,611 - -- non current 75,542 1,951,339 - -

103,195 3,508,950 - -

Bankers’ acceptance is secured by way of first legal charge over a subsidiary company’s freehold land and a building, second legal charge over certain leasehold land, pledge of fixed deposits of RM305,064 and is jointly and severally guaranteed by certain Directors of the subsidiary company. Interest was incurred during the financial year at rates ranging from 4.35% to 5.80% (financial year ended 31.3.2000: 4.80% to 8.00%) per annum.



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24 Bank overdrafts (secured)The bank overdrafts of the Group are secured by way of corporate guarantee of the Company, assignment of contract revenue, pledge of fixed deposits of RM1,191,832 (2000: RM717,663) and are jointly and severally guaranteed by certain Directors of those subsidiary companies. Interest was incurred during the financial year at rates ranging from 6.00% to 10.30% (financial year ended 31.3.2000: 8.55% to 10.05%) per annum.

25 Share capitalCompany

2001 2000RM RM

Authorised:Ordinary shares of RM1 each

At beginning of the financial year/date of incorporation 100,000 100,000Created during the financial year 99,900,000 -

At end of the financial year/period 100,000,000 100,000

26 Retained earningsSubject to agreement by the tax authorities, the Company has sufficient Section 108 Malaysian tax credit to frank approximately RM1,387,000 (2000: Nil) of its retained earnings as at 31 March 2001 if paid out as dividends.

27 Deferred taxationProforma


RM RMAt beginning of the financial year 620,000 930,000Transfer to income statements (Note 7) (588,000) (310,000)

At end of the financial year 32,000 620,000

28 Acquisition of subsidiary companies(a) In conjunction with, and as an integral part of the listing of and quotation for the entire issued and paid-up share capital

of the Company on the Second Board of Kuala Lumpur Stock Exchange, the Company undertook a restructuring scheme, which involved the acquisition of the following subsidiary companies:

(i) Acquisition of the entire issued and paid-up share capital in Weida Integrated Industries Sdn. Bhd. ("WIISB") for a purchase consideration of RM21,471,768 satisfied by the issue of 14,808,116 new ordinary shares of RM1.00 each at RM1.45 per ordinary share.

(ii) Acquisition of the entire issued and paid-up share capital of Weida Resources Sdn. Bhd. ("WRSB") for a purchase consideration of RM11,314,780 satisfied by the issue of 7,803,297 new ordinary shares of RM1.00 each at RM1.45 per ordinary share.



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28 Acquisition of subsidiary companies (cont’d)

(iii) Acquisition of the entire issued and paid-up share capital of Weida Works Sdn. Bhd. (formerly known as Weida Holdings Sdn. Bhd.) ("WHSB") for a purchase consideration of RM553,367 satisfied by the issue of 381,632 new ordinary shares of RM1.00 each at RM1.45 per ordinary share.

(iv) Acquisition of 51% of the issued and paid-up share capital of Weida Marketing ("WMSB") Sdn. Bhd. for a cash consideration of RM255,000.

(v) Acquisition of 70% of the issued and paid-up share capital of Weidaya Sdn. Bhd. ("Weidaya") for a cash consideration of RM350,000.

(vi) Acquisition of 51% of the issued and paid-up share capital of Weida Environmental Technology Sdn. Bhd. ("WETSB") for a cash consideration of RM51,000.

(vii) Acquisition of 51% of the issued and paid-up share capital of Saruwas Sdn. Bhd. ("Saruwas") for a cash consideration of RM102,000.

All the above acquisitions were completed on 23 October 2000.

The acquisitions of WIISB, WRSB and WHSB which meet the criteria for merger accounting under Malaysian Accounting Standards No. 2, Accounting for Acquisition and Mergers, have been accounted for under that method. The acquisitions of WMSB, Weidaya, WETSB and Saruwas are accounted for under acquisition accounting. No significant accounting adjustments were required by the subsidiary companies to achieve consistency of accounting policies.

A summary of the effect of the acquisition of subsidiary companies accounted for under acquisition accounting on the cash flows of the Group at the date of acquisition is set out below:

At date of acquisitionRM

Property, plant and equipment 675,315Inventories 1,956,111Properties held for resale 415,963Receivables, deposits and prepayments 8,324,038Deposits, bank and cash balances 601,083Payables and accruals (8,630,101)Tax (253,106)Borrowings (144,923)Minority interest (1,054,988)

Fair value of net assets acquired 1,889,392Goodwill on consolidation 155,459Reserve on consolidation (1,286,851)

Total purchase consideration 758,000Less: Consideration payable as amount due from holding company (758,000)Less: Cash and Cash equivalent in subsidiary companies acquired (601,083)

Net cash inflow on acquisitions (601,083)



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(b) Effect of acquisition on the consolidated financial statements

The effects of the above acquisitions on the net profit attributable to shareholders of the Group/Proforma Group may be analysed as follows:

GroupFinancial year ended 31.3.2001

Before Aftermerger/ merger/

acquisition acquisitiondate date TotalRM RM RM

Company (831) (12,901) (13,732)WIISB, WRSB and WHSB 5,086,547 837,408 5,923,955WMSB, Weidaya, WETSB and Saruwas - 722,522 722,522

5,085,716 1,547,029 6,632,745

A summary of the effect of the above acquisitions of the subsidiary companies on the financial position of the Groupas at 31 March 2001 is set out below:

31.3.2001WMSB,

Weidaya,WIISB, WRSB WETSB and

and WHSB Saruwas TotalRM RM RM

Property, plant and equipment 38,476,686 734,073 39,210,759Associated company 38,765 - 38,765Intangible assets (including goodwill) - 152,868 152,868Inventories 14,043,851 43,900 14,087,751Properties held for resale - 267,347 267,347Receivables, deposits and prepayments 9,934,487 6,498,417 16,432,904Deposits, bank and cash balances 6,845,957 1,129,738 7,975,695Provision for liabilities (624,999) - (624,999)Payables and accruals (6,499,683) (787,154) (7,286,837)Tax (1,657,889) (506,156) (2,164,045)Borrowings (secured) (9,786,000) (103,195) (9,889,195)Bank overdrafts (secured) (3,916,002) - (3,916,002)Deferred taxation (32,000) - (32,000)Minority interest - (1,103,112) (1,103,112)

Increase in Group net assets 46,823,173 6,326,726 53,149,899



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(b) Effect of acquisition on the consolidated financial statements (cont’d)

For ease of comparability, the pre-acquisition results of those subsidiary companies accounted for under acquisitionaccounting are disclosed as follows:

Financialperiod from Financial

1.4.2000 to the year endeddate of acquisition 31.3.2000

RM RMRevenue 10,930,783 17,328,774Other operating income - 4,400Changes in inventories and work-in-progress 1,073,321 517,360Purchase of finished goods (9,348,178) (13,602,875)Staff cost (662,777) (920,113)Depreciation (108,289) (144,843)Transportation charges (266,233) (410,493)Other operating expenses (817,216) (1,303,834)

Profit from operations 801,411 1,468,376Finance cost (13,546) (24,791)

Profit before tax 787,865 1,443,585Tax (288,838) (407,962)

Profit from ordinary activities after tax 499,027 1,035,623Minority interest (155,973) (403,463)

Net profit attributable to shareholders 343,054 632,160

The pre-acquisition results as shown above have not been adjusted for the financial effects of the transactions between these subsidiary companies and those subsidiary companies accounted for under merger accounting which aredisclosed as follows:

ProformaGroup Group

Financial Financialyear ended year ended31.3.2001 31.3.2000

RM RMSales of finished goods to:- Weidaya Sdn. Bhd. (2,871,885) (3,083,131)- Weida Marketing Sdn. Bhd. (3,773,303) (6,480,825)- Weida Environmental Technology Sdn. Bhd. (690,120) (1,293,263)- Weida Resources Sdn. Bhd. (939,700) (947,820)

Payment of project management fee to:- Saruwas Sdn. Bhd. 308,481 617,134

29 Cash and cash equivalentsProforma


RM RM RM RMFixed deposits with licensed banks,

which are not pledged as securities(Note 20) 16,692,442 2,254,594 12,600,000 -

Bank and cash balances 2,644,071 1,045,140 4,305 2Bank overdrafts (secured) (Note 24) (3,916,002) (6,593,817) - -

15,420,511 (3,294,083) 12,604,305 2



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30 Significant related party disclosuresIn the normal course of business, the Company undertakes on agreed terms, transactions with related parties.

The significant related party transactions during the financial year/period are as follows:Proforma

Group GroupFinancial Financial

year ended year ended31.3.2001 31.3.2000

RM RMTransactions with an associated company of the holding company:Sales of finished goods:- Weidasar Sdn. Bhd. (675,123) (1,306,638)

Contract revenue received from:- Weidasar Sdn. Bhd. (525,950) -

Transactions with a company in which certain directors have financial interests:Rental paid/payable to:- Premium Fortune Sdn. Bhd. 22,500 -

Sales proceeds received from disposal of land to:- Premium Fortune Sdn. Bhd. (921,600) -

31 Contingent liabilities (secured)Proforma


RM RMBankers’ guarantees granted to third parties 1,817,016 536,445

32 Segmental analysisNo segmental analysis is presented as the Group is primarily engaged in the manufacturing, marketing and trading of HDPE engineering products and the provision of turnkey and project management services that involve the use of or related to the sale of HDPE engineering products in Malaysia.

33 Significant post balance sheet eventOn 3 May 2001, the Company acquired the entire issued and paid-up share capital in Weida Agrotech Sdn. Bhd.,Weida Dagangan Sdn. Bhd., Weida Engineering Sdn. Bhd., Weidaline Sdn. Bhd. and Weida Tank Sdn. Bhd., which comprise of two (2) ordinary shares of RM1 each for a cash consideration of RM2 in each of these subsidiary companies. At the date of the acquisitions, these subsidiary companies have not commenced operations.

On 21June 2001, Weida Agrotech Sdn. Bhd., Weida Dagangan Sdn. Bhd., Weidaline Sdn. Bhd. and Weida Tank Sdn. Bhd. have increased their respective issued and paid-up share capital to RM100,000 by the issue of 99,998 ordinaryshares of RM1 each at par, which are fully subscribed by Weida (M) Bhd..



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LIST OF PROPERTIES


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49

AS AT 31 MARCH 2001

Location Usage Tenure Year of Land Approximate Net Book Date ofExpiry Area/Sq Value (RM) Cast

Metre as at Revalue31/3/2001

Lot 472, Block 8, Office and Leasehold 7/7/2058 70,380.0 3 15,815,656 31/1/2001Muara Tebas Land manufacturingDistrict, Jalan Bako, building andKuching, Sarawak storage yard

Lot 56, Sedco-Lok Storage yard Leasehold 31/12/2042 3,747.8 NA 594,809 31/1/2001Kawi Industrial Estate,Kota Kinabalu, Sabah

Lot 58, Sec Sedco-Lok Storage yard Leasehold 31/12/2042 4,185.3 NA 663,526 31/1/2001Kawi Industrial Estate,Kota Kinabalu, Sabah

Lot 57, Sec Sedco-Lok Offices and Leasehold 31/12/2042 8,704.4 5 2,587,236 31/1/2001Kawi Industrial Estate, manufacturingKota Kinabalu, Sabah building

Lot 109, Jalan AM2, Offices and Freehold 12,311.5 4 4,041,516 31/1/2001Arab-Malaysian manufacturingIndustrial Park, 71800 building &Nilai, Seremban storage yard

NA - Not applicable

For detail of the group revaluation policy, please refer to Note 3(e), Pg 27.

Authorised Share Capital : RM100,000,000Issued and Paid-up Capital : RM40,000,000Class of Shares : Ordinary Shares of RM1.00 eachVoting Rights : One vote per ordinary share

Size of Holdings No. of Holders Total Holdings %less than 1,000 - - -

1,000 to 10,000 1,480 3,615,000 9.0410,001 to 100,000 27 829,000 2.07

100,001 to less than 5% of issued shares 17 10,918,028 27.305% and above of issued shares 5 24,637,972 61.59

1,529 40,000,000 100.00

LIST OF THIRTY LARGEST SHAREHOLDERSNo. of shares Percentage

held (%)1. Weida Management Sdn. Bhd. 8,737,357 21.84

2. Assar Industri Sdn. Bhd. 4,785,197 11.96

3. Tuan Haji Zainal Abidin Bin Ahmad 4,481,550 11.20

4. Tiara Senja Sdn. Bhd. 3,866,224 9.67

5. HSBC Nominees (Tempatan) Sdn. Bhd. 2,767,644 6.92- HSBC (Malaysia) Trustee Berhad for Amanah Saham Sarawak

6. HLG Nominee (Tempatan) Sdn. Bhd. 1,838,758 4.60- Assar Asset Management Sdn. Bhd. for Assar Industri Sdn. Bhd.

7. Tuan Haji Zainal Abidin Bin Ahmad 1,772,154 4.43

8. Lee Choon Chin 1,412,273 3.53

9. Chai Mui Huon 858,738 2.15

10. Law Lee Koon 740,737 1.85

11. Lim Wei Wui 650,000 1.63

12. Liew Kee Moi 595,966 1.49

13. Sim Hong Swee 509,000 1.27

14. Phua Kok Hui 481,000 1.20

15. Yong Lin Lin 430,682 1.08

16. Jee Hon Chong 360,568 0.90

17. Tok Jiak Yong 291,568 0.73


ANALYSIS OF SHAREHOLDINGS

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50

AS AT 30 JUNE 2001

18. Yayasan Sarawak 273,959 0.68

19. Jee Cheng Kong 208,341 0.52

20. Satria Nominees (Tempatan) Sdn. Bhd. 200,000 0.50- Pledged securities account for Tuan Haji Zainal Abidin Bin Ahmad

21. Lai Siew Mu 170,000 0.43

22. Lai Lim Hon 124,284 0.31

23. Sia Seng Ming 80,000 0.20

24. Mayban Nominees (Tempatan) Sdn. Bhd. 65,000 0.16- Pledged securities account for Jee Cheng Kong

25. Iskandar Bin Abd Rahman 50,000 0.13

26. Lee Wee Thiam 50,000 0.13

27. Ng San Chuan 46,000 0.12

28. Abang Asri Bin Ariffin 42,000 0.11

29. Lee Swee Hang 41,000 0.10

30. Golden Tile (M) Sdn. Bhd. 40,000 0.10

ANALYSIS OF SHAREHOLDINGS (cont’d)


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51

AS AT 30 JUNE 2001

LIST OF SUBSTANTIAL SHAREHOLDERSNo. of shares held

Name Direct Direct Deemed TotalInterest Interest Interest Shareholdings

(registered in (held Through (%)own name) Nominees)

1. Lee Choon Chin 1,412,273 - 9,333,323*1 26.86%(3.53%) (23.33%)

2. Liew Kee Moi (f) 595,966 - 10,149,630*2 26.86%(1.49%) (25.37%)

3. Weida Management Sdn. Bhd. 8,737,357 - - 21.84%(21.84%)

4. Assar Industri Sdn. Bhd. 4,785,197 1,838,758 - 16.56%(11.96%) (4.60%)

5. Tuan Haji Zainal Abidin Bin Ahmad 6,253,704 200,000 - 16.13%(15.63%) (0.50%)

6. Tiara Senja Sdn. Bhd. 3,866,224 - - 9.67%(9.67%)

7. HSBC (Malaysia) Trustee Berhad - 2,767,644 - 6.92%for Amanah Saham Sarawak (6.92%)

8. Chai Mui Huon 858,738 - - 2.15%(2.15%)

*1 Deemed interested by virtue of his substantial interest in Weida Management Sdn. Bhd. and his spouse’s (Liew Kee Moi)direct shareholding in Weida (M) Bhd.

*2 Deemed interested by virtue of her spouse’s (Lee Choon Chin) substantial interest in Weida Management Sdn. Bhd. andher spouse’s direct interest in Weida (M) Bhd.



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AS AT 30 JUNE 2001

DIRECTORS’ INTEREST

No. Name of Director No. of shares held TotalDirect % Indirect % Shareholding %

1. Tuan Haji Su’ut Bin Haji Suhaili 10,000 0.03 - - 10,000 0.03

2. Lee Choon Chin 1,412,273 3.53 9,333,323@ 23.33 10,745,596 26.86

3. Datu Voon Chen Hian 10,000 0.03 - - 10,000 0.03@ Voon Chen Kok

4. Datuk Dr. Stalin Hardin 10,000 0.03 - - 10,000 0.03

5. YBhg. Dato Abdul Rahiman - - - - - -Bin A.S. Dawood

6. Tuan Haji Zainal Abidin Bin Ahmad 6,453,704* 16.13 - - 6,453,704 16.13

7. Ahmad Tarmizi Bin Sulaiman 10,000 0.03 - - 10,000 0.03

8. Zaidi Bin Ahmad 10,000 0.03 - - 10,000 0.03

9. Yong Lin Lin 430,682 1.08 - - 430,682 1.08

10. Jee Hon Chong 360,568 0.90 - - 360,568 0.90

@ Deemed interested by virtue of his substantial interest in Weida Management Sdn. Bhd. and his spouse’s (Liew Kee Moi) direct shareholding in Weida (M) Bhd.

* 200,000 shares held through Satria Nominees (Tempatan) Sdn. Bhd.



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AS AT 30 JUNE 2001


NOTES

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I/Weofbeing a member/members of the abovenamed Company hereby appoint *the Chairman of the Meeting or

ofor failing him,ofas my/our proxy to vote for me/us and on my/our behalf at the Second Annual General Meeting of the Company to be held on Wednesday, 22August 2001 at 10.00 am and any adjournment thereof.

N O . R E S O L U T I O N S F O R A G A I N S T

Please indicate "X" in the appropriate box against each resolution how you wish your vote to be casted. If no specific direction as to voting isindicated, the proxy will vote or abstain at his/her direction.

As witness my/our hand(s) this day of , 2001

Signature of shareholder(s)/common seal

Notes :-

1. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Companies Act 1965 shall not apply to the Company.

2. To be valid, this form, duly completed must be deposited at the Office of the Company at No. 187, Lorong Datuk Abang Abdul Rahim 7, 93450 Kuching, Sarawak

not less than 48 hours before the time set for holding the meeting or any adjournment thereof.

3. A member shall be entitled to appoint more than one (1) proxy to attend and vote at the same meeting provided that the provisions of Section 149(1)(c) of the

Companies Act 1965 are complied with.

4. Where a member appoints more than one (1) proxy, the appointment shall be invalid unless he specifies the proportions of his holdings to be represented by each

proxy.

5. If the appointor is a corporation this form must be executed under its common seal or under the hand of an officer or attorney duly authorised.

PROXY FORM

Shareholding Represented by Proxy

1. To adopt the Audited Accounts for the year ended 31 March 2001

2. To declare a First and Final dividend of 5% less 28% income tax, for the year ended 31 March 2001

3. To re-elect Tuan Haji Su’ut Bin Haji Suhaili retiring in accordance with Article 88 of the Company’s Articles of Association

4. To re-elect Lee Choon Chin retiring in accordance with Article 88 of the Company’s Articles of Association

5. To re-elect Datu Voon Chen Hian @ Voon Chen Kok retiring in accordance with Article 88 of the Company’sArticles of Association

6. To re-elect Tuan Haji Zainal Abidin Bin Ahmad retiring in accordance with Article 88 of the Company’s Articles of Association

7. To re-elect Ahmad Tarmizi Bin Sulaiman retiring in accordance with Article 88 of the Company’s Articlesof Association

8. To re-elect Zaidi Bin Ahmad retiring in accordance with Article 88 of the Company’s Articles of Association

9. To re-elect Yong Lin Lin retiring in accordance with Article 88 of the Company’s Articles of Association

10. To re-elect Jee Hon Chong retiring in accordance with Article 88 of the Company’s Articles of Association

11. To re-elect Datuk Dr. Stalin Hardin retiring in accordance with Article 88 of the Company’s Articles of Association

12. To re-elect YBhg. Dato Abdul Rahiman Bin A.S. Dawood retiring in accordance with Article 88 of the Company’sArticles of Association

13. To approve the payment of Directors’ fees for the year ended 31 March 2001

14. To re-appoint Messrs. PricewaterhouseCoopers as auditors

15. Special businessSpecial resolution on amendment of Company’s Articles of Association

16. Special businessOrdinary resolution on authority pursuant to Section 132E of the Companies Act, 1965

Company No: 504747-W)(Incorporated In Malaysia)

The Company SecretaryWEIDA (M) BHD

(Company No: 504747-W)

187 Lorong Datuk Abang Abdul Rahim 793450 Kuching Sarawak

Stamp

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Documents

WEIDA (M) BHD Report 2001.pdf · WEIDA (M) BHD (504747-W) page 5 TUAN HAJI SU’UT HAJI SUHAILI Tuan Haji Su’ut Haji Suhaili, aged 54 is the Group Chairman. He was appointed to