TIDMHID
RNS Number : 3756U
Hidong Estate PLC
29 July 2015
Hidong
Estate
PLC
(Incorporated in England)
Contents
Page
Notice of meeting .. .. .. .. .. .. .. .. .. .. .. ..
.. .. .. .. .. .. .. .. .. .. .. 1 - 2
Corporate information .. .. .. .. .. .. .. .. .. .. ..
.. .. .. .. .. .. .. .. .. .. 3 - 4
Chairman's statement .. .. .. .. .. .. .. .. .. .. ..
.. .. .. .. .. .. .. .. .. .. 5
Strategic report .. .. .. .. .. .. .. .. .. .. .. .. ..
.. .. .. .. .. .. .. .. .. .. .. 6
Report of the directors .. .. .. .. .. .. .. .. .. ..
.. .. .. .. .. .. .. .. .. .. .. 7 - 12
Directors' remuneration report .. .. .. .. .. .. .. .. 13 -
.. .. .. .. .. .. .. .. .. .. 14
Statement of directors' responsibilities in respect of
the annual report and the financial statements .. .. ..
.. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. 15 -
.. .. .. .. 16
Independent auditor's report to the members of Hidong 17 -
Estate Plc .. .. .. .. 19
Profit and loss account .. .. .. .. .. .. .. .. .. ..
.. .. .. .. .. .. .. .. .. .. .. 20
Balance sheet .. .. .. .. .. .. .. .. .. .. .. .. .. ..
.. .. .. .. .. .. .. .. .. .. 21
Statement of total recognised gains and losses .. .. ..
.. .. .. .. .. .. .. .. 22
Reconciliation of movements in shareholders' funds ..
.. .. .. .. .. .. .. .. 22
Cash flow statement .. .. .. .. .. .. .. .. .. .. .. ..
.. .. .. .. .. .. .. .. .. .. 23
Notes to the financial statements .. .. .. .. .. .. .. 24 -
.. .. .. .. .. .. .. .. .. .. 32
Comparative statistics .. .. .. .. .. .. .. .. .. .. ..
.. .. .. .. .. .. .. .. .. .. 33
Notice of meeting
NOTICE IS HEREBY GIVEN that the NINETY-SECOND ANNUAL GENERAL
MEETING of the Company will be held at the head office of the
Company, Third Floor, Standard Chartered Bank Chambers, Beach
Street, 10300 Penang, Malaysia on Monday, 28 September 2015 at
10:30 a.m. for the following purposes:-
1. To receive and consider the audited financial statements and
the reports of the directors and auditors thereon for the year
ended 31 March 2015.
2. To re-elect Mr. Diong Chin Teck who retires in accordance
with article 108 of the Company's Articles of Association, and
being eligible, offers himself for re-election.
3. To re-appoint the auditors and to authorise the directors to fix their remuneration.
Ordinary Resolution:-
"THAT KPMG LLP be and is hereby appointed auditors of the
Company to hold office from the conclusion of this meeting until
the conclusion of the next general meeting at which financial
statements are laid before the Company, and that their remuneration
be fixed by the directors."
4. To approve the Directors' Remuneration Report
Ordinary Resolution:-
"THAT the Directors' Remuneration Report for the year ended 31
March 2015 be and is hereby approved."
5. To approve the Directors' Remuneration Policy
Ordinary Resolution:-
"THAT the Directors' Remuneration Policy be and is hereby
approved"
6. To approve the following resolutions as Ordinary Resolutions :-
(a) "THAT subject to the passing of Ordinary Resolution 2,
authority be and is hereby given to Mr Diong Chin Teck who has
served as an independent non-executive director of the Company for
a cumulative term of more than nine (9) years to continue to act as
an independent non-executive director of the Company."
(b) "THAT authority be and is hereby given to Tuan Haji Zambri
bin Haji Mahmud who has served as an independent non-executive
director of the Company for a cumulative term of more than nine (9)
years to continue to act as an independent non-executive director
of the Company."
(c) "THAT authority be and is hereby given to Mr Chew Beow Soon
who has served as an independent non-executive director of the
Company for a cumulative term of more than nine (9) years to
continue to act as an independent non-executive director of the
Company."
7. To transact any other business of which due notices shall have been given.
By order of the Board
GRACE SMITH
Secretary
28 July 2015
Notes
1. A member entitled to attend and vote at the meeting is
entitled to appoint one or more proxies to attend and vote instead
of him. A proxy need not be a member of the Company. A form of
proxy is enclosed for your completion and return.
2. A statement of all transactions of each director and, where
applicable, of his family in the share capital of the Company will
be available at the head office of the Company on any weekday
during normal business hours from the date of this notice until the
conclusion of the annual general meeting. There are no service
contracts in existence with the directors.
3. Biographical details of the directors presenting themselves
for re-election and re-appointment are set out on the following
page. The Board has reviewed the performance of each individual
director, including the directors presenting themselves for
re-election and re-appointment, and concluded that each director
has performed effectively and continues to demonstrate commitment
to the role.
Corporate information
DIRECTORS
Chew Sing Guan (Chairman)
An executive director and chairman of the Company since 1983. A
non-executive director of the managing agents and Malaysian
registrars, Plantation Agencies Sdn. Berhad. Age 65.
Haji Zambri bin Haji Mahmud
A non-executive director of the Company since 1986. A director
of several private limited companies involved in palm oil milling.
Age 76.
Diong Chin Teck
A non-executive director of the Company since 2000. A director
of several public limited companies, a few of which are quoted. Age
82.
Chew Beow Soon
A non-executive director of the Company since 2000. A director
of several private limited companies. Age 66.
AUDIT COMMITTEE
Haji Zambri bin Haji Mahmud (Chairperson)
Chew Beow Soon (Member)
Diong Chin Teck (Member)
COMPANY SECRETARY
Grace Smith
HEAD OFFICE, MANAGING AGENTS
AND MALAYSIAN REGISTRARS
Plantation Agencies Sdn. Berhad
Third Floor, Standard Chartered Bank Chambers,
Beach Street, 10300 Penang, Malaysia.
P.O.Box 706,
10790 Penang, Malaysia.
REGISTERED OFFICE
Neville Registrars Limited
Neville House
18 Laurel Lane
Halesowen
West Midlands
B63 3DA
U.K. REGISTRARS
Neville Registrars Limited
Neville House
18 Laurel Lane
Halesowen
West Midlands
B63 3DA
AUDITORS
KPMG LLP
15 Canada Square
London, E14 5GL
LISTING
London Stock Exchange
Chairman's statement
On behalf of the Board of Directors, I am pleased to present our
Annual Report of Hidong Estate Plc for the financial year ended 31
March 2015.
For the financial year ended 31 March 2015 the Company recorded
a profit before tax of RM194,882 (2014 : RM388,504). The gain is
mainly attributable to dividend and interest income.
The overall increase in shareholders' funds of RM159,661 was
attributed to current year profit after tax of RM127,031 and
increase in fair value reserve of RM32,630 as a result of stronger
share prices as at 31 March 2015.
The Board continues to look for viable business ventures with
the objective of maximising long term growth and enhancing
shareholders' value.
The Company's principal financial asset is cash and short term
deposits with banks and reputable established financial
institutions. With this prudent liquidity management, the Company
maintains sufficient levels of cash or readily convertible
investments to quickly respond to opportunities should they
eventualise.
The fragile economic conditions in major economies have been
increasingly challenging. The rapid decline in oil prices and quick
adjustments in exchange rates are just a few examples of the
economic factors at play. There is increased financial volatility
in emerging market economies, and increases in the cost of capital
will likely dampen investment and weigh on growth. China growth is
projected to edge down as the restructuring of the economy
progresses, with services taking over from investment and real
estate as the main driver of economic growth. In the past year, the
Board has studied several business proposals but there is yet no
successful conclusion to report. The Board will continue to look
out for possibilities.
On behalf of the Board, I would like to thank the Directors,
management and all the staff for their dedication, commitment and
contribution to the Company in the past year. I would like to also
express my sincere thanks to the shareholders, bankers and
associates for their continued support.
CHEW SING GUAN
Chairman
Penang, Malaysia
28 July 2015
Strategic Report
The original principal activities of the Company which were the
production of natural rubber and oil palm fresh fruit bunches
ceased when the Company sold its land and plantations in 2006.
Since then, the Board has been actively identifying suitable
investments for the Company.
The Company's assets after the disposal of the plantation and
its other plant and equipment comprise cash and bank deposits all
of which earn interest and investments in listed equities.
PERFORMANCE INDICATORS
The Company's performance in its investment activities are
highlighted as follows:
2015 2014
RM RM
Lower income derived from
Income from investments 46,332 60,063 investments in 2015.
Lower gain on disposal
of investments in equities
Gain on disposal of investments 37,186 149,681 in 2015.
Interest receivable on Consistent returns from
short interest on short term
term bank deposits 359,721 334,178 bank deposits.
All performance measures are in line with management's
expectations.
PRINCIPAL RISKS AND UNCERTAINTIES
As the Company's assets comprise cash and bank deposits and
investments in listed equities, the financial risks involved are
minimal. The principal risks and the steps the Company has taken to
manage these risks are disclosed in Note 13 to the financial
statements.
All of the Company's day-to-day management and administrative
functions are outsourced to third parties. As a result, the Company
has no employees or internal operations. The Company has therefore
not reported further in respect of these provisions in this annual
report.
CHEW SING GUAN CHEW BEOW SOON
Chairman Director
Penang, Malaysia
28 July 2015
Report of the directors
The directors present their annual report and financial
statements of the Company for the financial year ended 31 March
2015.
RESULTS AND DIVIDEND
The Company made a profit after tax of RM127,031 for the current
financial year as compared to RM321,338 in the previous year. The
directors do not recommend any final dividend to be paid for the
current financial year (2014 : RM Nil).
DIRECTORATE
The names of the directors who held office during the year
together with brief biographical details are shown on page 3. In
accordance with article 108 of the Company's Articles of
Association, Mr. Diong Chin Teck will retire by rotation at the
forthcoming annual general meeting and, being eligible, offers
himself for re-election.
The directors do not have any service contract with the Company.
Mr. Chew Sing Guan is a non-executive director of Plantation
Agencies Sdn. Berhad who acted as the Malaysian Registrars and an
agent to the Company in Malaysia.
SUBSTANTIAL SHAREHOLDINGS
At the date of this report, substantial interests in the share
capital of the Company, as notified to the Company, were as
follows:-
No. of ordinary shares of
10p each %
Malayan Securities Trust Sdn.
Berhad 798,986 46.63
Thomas William George Charlton 234,997 13.72
Flairshare Limited 132,000 7.70
The Temerloh Rubber Estates
Berhad 88,442 5.16
Mr. Chew Sing Guan has notified an interest in the shares held
by Malayan Securities Trust Sdn. Berhad. The directors are not
aware of any other beneficial holding of 3% or more in the share
capital of the Company.
PAYMENT TO SUPPLIERS
The Company does not follow any code or standard on payment
practice. The Company's policy, in relation to all of its
suppliers, is to make settlement according to the terms of payment
agreed at the commencement of business with that supplier provided
that the supplier has complied with the terms and conditions of the
supply agreement.
TAXATION
The Company is tax resident in Malaysia.
CORPORATE GOVERNANCE
As at the date of this report the Company does not comply in all
respects and the Company does not intend to comply in all respects
with the UK Corporate Governance Code (2012).
Internal Audit
The need for an internal audit function has been reviewed by the
directors. It was decided that the current size of the Company
combined with the tight financial and management control exercised
by the directors on a day-to-day basis negates such a need. The
policy will be kept under review.
External Auditors
The Audit Committee assesses annually the effectiveness of the
external audit process and has primary responsibility for making
recommendation on the appointment, re-appointment or removal of the
external auditors.
The current external auditor was appointed in 1999 and have been
re-appointed annually since then. The Company last conducted a
tender for external auditors in 1999. Due to the nature of the
company it was not felt necessary to tender the audit in accordance
with the Corporate Governance Code.
The external auditors did not provide any non audit services in
this or the previous year.
Directors
The directors carry out their duties in a manner that will
safeguard the shareholders' interests at all times. They are
responsible for ensuring sound management of the Company and
effective implementation and execution of its policies, decisions
and business strategies towards ensuring a successful continuity of
the business.
The Board ordinarily meets four times a year. During the year
ended 31 March 2015 the Board met on three occasions. Details of
the directors' attendance at Board meetings during the financial
year are as follows:
Attendance
Chew Sing Guan 3/3
Haji Zambri bin Haji Mahmud 3/3
Diong Chin Teck 3/3
Chew Beow Soon 3/3
The Board is guided by a formal schedule of matters specifically
reserved to it for decision making which includes future strategy,
key business policies, material acquisitions and disposals,
approval of interim financial statements, annual reports and
financial statements. Directors have full and timely access to
information and Board papers and reports relevant to the issues of
meetings are circulated to Board members in advance of the
meetings. Procedures are in place for directors to take independent
professional advice in the furtherance of their duties, if
necessary, at the Company's expense. In addition, all directors
have direct access to the advice and services of the Company
Secretary.
Directors (Cont'd)
The Board consists of the executive Chairman, Mr. Chew Sing Guan
and three independent non-executive directors namely Tuan Haji
Zambri bin Haji Mahmud, Mr. Diong Chin Teck and Mr. Chew Beow Soon.
Even though the entity is not in compliance with the Corporate
Governance code as all three non-executive directors have been in
post for more than six years, the Board is satisfied that they have
continued to demonstrate independence in terms of character and
judgement.
In non compliance with the Corporate Governance code it is the
Board's view that for a Company of this size it is not deemed
necessary to separate the posts of chairman and chief executive
officer. Furthermore, the Board is of the opinion that there is a
strong independent element within the Board in the form of the
three independent non-executive directors who provide a check and
balance in the Board on decision making. For the same reasons, even
though this is not in compliance with the Corporate Governance
code, the Board is also of the view that it is not deemed necessary
to appoint a senior independent director or to form a Nomination
Committee. The Board is assisted by professionals (Managing Agents)
who report periodically to it. Important business matters are
submitted to the Board for decision.
In addition, in non compliance with the Corporate Governance
Code, Mr. Chew Sing Guan is a non-executive director of Plantation
Agencies Sdn. Berhad who acted as the Malaysian Registrars and an
agent to the Company in Malaysia.
In accordance with the Articles of Association of the Company,
all directors are subject to election by shareholders at the first
Annual General Meeting after their appointment and thereafter
subject for re-election at least once every three years. The Board
has always complied with this requirement. The Board has chosen not
to adopt the additional provision in the Code that non-executive
directors who have served for more than nine years should be
subject to annual re-election since the existing practice, which
complies with Company law and the Articles, works well.
The directors received only a nominal fee for their services and
there is no intention to change the way they are remunerated.
Accordingly, the formation of a Remuneration Committee is not
deemed to be necessary.
The Board has commenced a self-evaluation process for the
performance evaluation of the Board, the Audit Committee and its
individual directors. The assessment of the individual directors on
the performance of the Board and the Audit Committee are collated
for the Chairman's review and presented to the entire Board. Each
director also assesses the individual performance of the other
directors and the results are presented to the Chairman who then
holds discussions with all the individual directors regarding their
effectiveness. The performance of the Chairman is assessed
collectively by the non-executive directors.
Relations with shareholders
The Board has through the years used the Annual Report and the
Annual General Meeting to communicate with its shareholders. It is
always ready to hold dialogues with interested investors to improve
the Company's business activities.
Audit Committee
The Audit Committee comprises three independent non-executive
directors, namely Tuan Haji Zambri bin Haji Mahmud (Chairperson),
Mr. Diong Chin Teck and Mr. Chew Beow Soon.
The Audit Committee is responsible for reviewing the Company's
risk management, internal control and audit processes. The Audit
Committee assists the Board in seeking to ensure that the financial
and non-financial information supplied to the Board and
shareholders presents a balanced assessment of the Company's
position. The Committee is authorised by the Board to investigate
any activity within its terms of reference. It is authorised to
seek any information it requires from any employee and all
employees are directed to co-operate with any request made by the
Committee.
The Committee is authorised by the Board to obtain outside legal
or other independent professional advice and to secure the
attendance of outsiders with relevant experience and expertise it
considers necessary.
During the financial year ended 31 March 2015, the Audit
Committee met four times and the attendances of the members of the
Committee are as follows:
Attendance
Haji Zambri bin Haji Mahmud 3/4
Diong Chin Teck 4/4
Chew Beow Soon 3/4
During the year the Audit Committee assisted the Board in
reviewing the periodic operational and financial reports submitted
by the Managing Agents. As part of its function, the Audit
Committee reviewed the half-yearly interim report to shareholders
and annual financial statements and announcements before submitting
the same to the Board for approval. The Audit Committee also
assisted the Board to review the system of internal controls put in
place by the Managing Agents to manage the operations of the
Company.
Significant risk areas
The Company's assets mainly comprise cash and investments in
listed equities and this portfolio of cash and listed investments
is considered to be the key driver of operations and performance
results of the Company. The Audit Committee considered cash and
listed investments to be at low risk of significant misstatements
or not to be subject to a significant level of judgement. However,
due to their high materiality in the context of the financial
statements as a whole, the Audit Committee agreed with the
auditors' view that they are considered to be the area which had
the greatest effect on the overall audit of the financial
statements. The Audit Committee are satisfied that the risks
surrounding cash and listed investments are adequately mitigated
due to the fact that they are:
- comfortable with the processes and controls in place to record
investment transactions and to value the portfolio;
- comfortable with the processes and controls in place
surrounding the treasury function and the bank reconciliation
process; and
- the valuation of listed investments can be agreed to externally quoted prices.
Internal Controls
The Board is responsible for the Company's system of internal
control and for reviewing its effectiveness, which it does on an
annual basis. Such a system is designed to manage, rather than
eliminate, the risk of failure of achieving business objectives and
can provide only reasonable, but not absolute, assurance against
material misstatement or loss. There is a continuous process for
identifying, evaluating and managing the significant risks faced by
the Company. This process was in place throughout the year under
review and up to the date of approval of the annual report.
The key elements of the Company's internal controls are as
follows:
-- Risk assessment
The Board is responsible for the identification, evaluation and
review of risks facing the business. Such risks are reviewed on a
continuous basis and are carried out as part of the monthly
reporting.
-- Control environment and control activities
The day-to-day operation of the system of internal controls is
delegated to the Managing Agents. The management and control
procedures cover issues such as physical controls, segregation of
duties, authorisation levels and comprehensive financial and
operational reporting systems. Such procedures are documented for
effective control and monitoring.
-- Information and communication
The Board holds periodic formal and informal discussions on the
Company's affairs where all important business decisions are
formally discussed and documented. The Board holds periodic board
meetings to formally approve the financial reports submitted by the
Managing Agents.
DISCLOSURE OF INFORMATION TO AUDITORS
The directors who held office at the date of approval of this
directors' report confirm that, so far as they are each aware,
there is no relevant audit information of which the Company's
auditor is unaware and each director has taken all the steps that
they ought to have taken as a director to make themselves aware of
any relevant audit information and to establish that the Company's
auditor is aware of that information.
GOING CONCERN
Having undertaken all the appropriate procedures and assessing
the financial position as at the year end, performance and results
for the financial year, the directors have a reasonable expectation
that the Company has adequate resources to continue in operational
existence for the foreseeable future. Thus they continue to adopt
the going concern basis of accounting in preparing the annual
financial statements.
AUDITOR
As recommended by the Audit Committee, a resolution for the
re-appointment of KPMG LLP as auditors to the Company will be
proposed at the 2015 Annual General Meeting.
CHEW SING GUAN CHEW BEOW SOON
Chairman Director
Penang, Malaysia
28 July 2015
Directors' remuneration report
On behalf of the Board of Directors, I am pleased to present the
Directors' Remuneration Report for the year ended 31 March
2015.
This report has been prepared in accordance with the legislation
relating to the reporting of Directors' remuneration and complies
with the sections 420 to 421 of the Companies Act 2006 and of
Schedule 8 of SI 2008/410 Large and medium-sized companies and
groups (Accounts and Directors' Report) Regulation 2008, as
amended. The report also meets the relevant requirement of the
Listing Rules of the Financial Conduct Authority. In accordance
with the Act, this report is divided into a section on Directors'
Remuneration Policy and a second section on the annual Report on
Directors' Remuneration, which details the remuneration paid to the
Directors during the financial year under review.
Shareholders will be asked to vote separately on the Directors'
Remuneration Policy and the Report on Directors' Remuneration at
the Annual General Meeting of the Company at which the financial
statements will be approved.
The regulations require the auditors to report to the Company's
members on the "auditable part" of the Directors' remuneration. The
report has therefore been divided into 2 sections for audited and
unaudited information.
Unaudited Information
Directors' Remuneration Policy
In accordance with the Company's Memorandum and Articles of
Association, the directors received only a nominal fee for their
services. The fees paid to the directors are not linked to
performance and the Company has no intention to change the way the
directors are remunerated in the future.
Share Options
As at 31 March 2015, no options were granted to the directors to
subscribe for any shares in the Company.
Service contracts
There are no service contracts in existence with the directors
and they received only a nominal fee for their services.
Audited information
Aggregate Directors' remuneration
The total amounts for Directors' remuneration are as
follows:
2015 2014
RM RM
Emoluments 4,506 4,350
------ ------
2015 2014
RM RM
Directors' emoluments - fee
Executive Director
Chew Sing Guan 1,287 1,242
Non - executive Directors
Haji Zambri bin Haji Mahmud 1,073 1,036
Diong Chin Teck 1,073 1,036
Chew Beow Soon 1,073 1,036
------ ------
4,506 4,350
------ ------
Approval
This report was approved by the Board of Directors on 28 July
2015 and signed on its behalf:
CHEW SING GUAN
Chairman
Statement of directors' responsibilities
in respect of the annual report and
the financial statements
The directors are responsible for preparing the Annual Report
and the financial statements in accordance with applicable law and
regulations.
Company law requires the directors to prepare financial
statements for each financial year. Under that law they have
elected to prepare the financial statements in accordance with UK
Accounting Standards and applicable law (UK Generally Accepted
Accounting Practice).
Under company law the directors must not approve the financial
statements unless they are satisfied that they give a true and fair
view of the state of affairs of the company and of the profit or
loss of the company for that period. In preparing these financial
statements, the directors are required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgments and estimates that are reasonable and prudent;
-- state whether applicable UK Accounting Standards have been
followed, subject to any material departures disclosed and
explained in the financial statements; and
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the company will
continue in business.
The directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the company's
transactions and disclose with reasonable accuracy at any time the
financial position of the company and enable them to ensure that
the financial statements comply with the Companies Act 2006. They
have general responsibility for taking such steps as are reasonably
open to them to safeguard the assets of the company and to prevent
and detect fraud and other irregularities.
Under applicable law and regulations, the directors are also
responsible for preparing a Strategic Report, Report of the
Directors, Directors' Remuneration Report and Corporate Governance
Statement that complies with that law and those regulations.
The directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
company's website. Legislation in the UK governing the preparation
and dissemination of financial statements may differ from
legislation in other jurisdictions.
The directors are responsible for confirming to the best of
their knowledge that:
-- the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view
of the assets, liabilities, financial position and profit or loss
of the company and the undertakings included in the consolidation
taken as a whole; and
-- the strategic report and directors' report
includes a fair review of the development and performance of the
business and the position of the issuer and the undertakings
included in the consolidation taken as a whole, together with a
description of the principal risks and uncertainties that they
face.
The directors consider that the annual report, taken as a whole,
is fair, balanced and understandable and provides the information
necessary for shareholders to assess the Company's performance,
business model and strategy.
Independent auditor's report
to the members of Hidong Estate Plc only
Opinions and conclusions arising from our audit
1 Our opinion on the financial statements is unmodified
We have audited the financial statements of Hidong Estate Plc
for the year ended 31 March 2015 set out on pages 20 to 32. In our
opinion the financial statements:
-- give a true and fair view of the state of the Company's
affairs as at 31 March 2015 and of its profit for the year then
ended;
-- have been properly prepared in accordance with UK Accounting Standards; and
-- have been prepared in accordance with the requirements of the Companies Act 2006.
2 Our assessment of risks of material misstatement
In arriving at our audit opinion above on the financial
statements the risk of material misstatement that had the greatest
effect on our audit was as follows:
Carrying amount of Cash and Listed Investments GBP11,703,445
Refer to page 10 (Audit Committee section of Report of
Directors), page 24 (accounting policy) and pages 20 to 32
(financial disclosures).
-- The risk - The Company's portfolio of cash and listed
investments makes up 99.6% of total assets (by value) and is
considered to be the key driver of operations and performance
results. We do not consider cash or listed investments to be at
high risk of significant misstatement, or to be subject to a
significant level of judgement because they comprise liquid and, in
the case of the listed investments, quoted, investments. However,
due to their materiality in the context of the financial statements
as a whole, they are considered to be the area which had the
greatest effect on our overall audit strategy and allocation of
resources in planning and completing our audit.
-- Our response - Our procedures over the existence,
completeness and valuation of the Company's portfolio of cash and
listed investments included, but were not limited to:
- documenting and assessing the processes and controls in place
to record investment transactions and to value the portfolio;
- agreeing the valuation of 100 per cent of listed investments to externally quoted prices; and
- agreeing 100 per cent of cash and listed investment holdings
to independently received third party confirmations.
3 Our application of materiality and an overview of the scope of our audit
The materiality for the financial statements as a whole was set
at RM 117,000. This has been determined with reference to a
benchmark of total assets (of which it represents 1%), which we
consider to be one of the principal considerations for members of
the Company in assessing its financial performance.
We agreed with the Audit Committee to report to it all
uncorrected misstatements with a value in excess of RM 6,000, in
addition to other audit misstatements below that threshold that we
believe warranted reporting on qualitative grounds.
Audit work to support this opinion is directed by the UK senior
statutory auditor, and in the light of the extent of the Company's
activities in Malaysia, is undertaken primarily by an audit team in
Malaysia and is reviewed by the UK audit team. The audit team in
Malaysia is led by an audit partner who, together with the UK
senior statutory auditor, participates in the audit committee
meetings.
4 Our opinion on other matters prescribed by the Companies Act 2006 is unmodified
In our opinion:
-- the part of the Directors' Remuneration Report to be audited
has been properly prepared in accordance with the Companies Act
2006; and
-- the information given in the Strategic Report and the
Directors' Report for the financial year for which the financial
statements are prepared is consistent with the financial
statements.
5 We have nothing to report in respect of the matters on which
we are required to report by exception
Under ISAs (UK and Ireland) we are required to report to you if,
based on the knowledge we acquired during our audit, we have
identified other information in the annual report that contains a
material inconsistency with either that knowledge or the financial
statements, a material misstatement of fact, or that is otherwise
misleading.
In particular, we are required to report to you if:
-- we have identified material inconsistencies between the
knowledge we acquired during our audit and the directors' statement
that they consider that the annual report and financial statements
taken as a whole is fair, balanced and understandable and provides
the information necessary for shareholders to assess the Company's
performance, business model and strategy; or
-- the Audit Committee section of the Report of the Directors
does not appropriately address matters communicated by us to the
Audit Committee.
Under the Companies Act 2006 we are required to report to you
if, in our opinion:
-- adequate accounting records have not been kept, or returns
adequate for our audit have not been received from branches not
visited by us; or
-- the financial statements and the part of the Directors'
Remuneration Report to be audited are not in agreement with the
accounting records and returns; or
-- certain disclosures of directors' remuneration specified by law are not made; or
-- we have not received all the information and explanations we require for our audit.
Under the Listing Rules we are required to review:
-- the directors' statement, set out on page 7, in relation to going concern; and
-- the part of the Corporate Governance Statement on page 8
relating to the Company's compliance with the nine provisions of
the 2010 UK Corporate Governance Code specified for our review.
We have nothing to report in respect of the above
responsibilities.
Scope of report and responsibilities
As explained more fully in the Directors' Responsibilities
Statement set out on page 15, the directors are responsible for the
preparation of the financial statements and for being satisfied
that they give a true and fair view. A description of the scope of
an audit of financial statements is provided on the Financial
Reporting Council's website at www.frc.org.uk/auditscopeukprivate.
This report is made solely to the Company's members as a body and
is subject to important explanations and disclaimers regarding our
responsibilities, published on our website at
www.kpmg.com/uk/auditscopeukco2013a, which are incorporated into
this report as if set out in full and should be read to provide an
understanding of the purpose of this report, the work we have
undertaken and the basis of our opinions.
Mark Smith (Senior Statutory Auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
15 Canada Square
London
E15 5GL
28 July 2015
Profit and loss account for the year ended
31 March 2015
2015 2014
Note RM RM
Administrative expenses (248,357) (155,418)
---------- ----------
Operating loss (248,357) (155,418)
Income from investments 46,332 60,063
Gain on disposal of investments 37,186 149,681
Interest receivable on short term bank
deposits 359,721 334,178
---------- ----------
Profit on ordinary activities before
taxation 2 194,882 388,504
Tax on profit on ordinary activities 3 (67,851) (67,166)
---------- ----------
Retained profit for the year 8 127,031 321,338
---------- ----------
Basic and diluted profit per 10p share 4 7.41 sen 18.76 sen
---------- ----------
The results stated above are all derived from continuing
operations.
A note on historical gains and losses has not been included as
part of the financial statements as there are no material
differences between the profit for the year stated above and the
historical cost equivalents.
Company Number: 00188390
The notes on pages 24 to 32 form part of these financial
statements.
Balance sheet as at 31 March 2015
Note 2015 2014
RM RM
Fixed assets
Investments 5 1,102,280 1,106,044
Current assets
-------------- --------------
Other debtors 42,933 35,729
Cash and cash equivalents 11 10,601,165 10,440,230
10,644,098 10,475,959
-------------- --------------
Current liabilities
Creditors 6 (477,926) (473,212)
(477,926) (473,212)
-------------- --------------
Net current assets 10,166,172 10,002,747
Net assets 11,268,452 11,108,791
-------------- --------------
Capital and reserves
Called up share capital 7 1,067,846 1,067,846
Fair value reserve 8 287,178 254,548
Profit and loss account 8 9,913,428 9,786,397
Shareholders' funds 11,268,452 11,108,791
-------------- --------------
These financial statements were approved by the Board of
Directors on 28 July 2015.
CHEW SING GUAN )
) Directors
)
CHEW BEOW SOON )
Company Number: 00188390
The notes on pages 24 to 32 form part of these financial
statements.
Statement of total recognised gains and losses for the year
ended 31 March 2015
2015 2014
RM RM
Profit for the financial year 127,031 321,338
Unrealised gains on investments 32,630 68,963
Total recognised gains for the year 159,661 390,301
-------- --------
Reconciliation of movements in shareholders' funds for the year
ended
31 March 2015
2015 2014
RM RM
Retained profit for the year 127,031 321,338
Other recognised gains for the year 32,630 68,963
Net addition to shareholders' funds 159,661 390,301
Opening shareholders' funds 11,108,791 10,718,490
Closing shareholders' funds 11,268,452 11,108,791
----------- -----------
The notes on pages 24 to 32 form part of these financial
statements.
Cash flow statement for the year ended
31 March 2015
Note 2015 2014
RM RM
NET CASH OUTFLOW FROM
OPERATING ACTIVITIES 9 (245,487) (148,283)
RETURNS ON INVESTMENTS AND SERVICING
OF
FINANCE
Dividend received 39,138 60,063
Interest received 352,517 333,480
TAXATION
Overseas tax paid (66,007) (43,148)
CAPITAL EXPENDITURE AND FINANCIAL
INVESTMENTS
Purchase of investments - (31,367)
Sale of investments 80,774 539,608
----------- -----------
NET CASH INFLOW BEFORE
MANAGEMENT OF LIQUID RESOURCES 160,935 710,353
MANAGEMENT OF LIQUID RESOURCES
Increase in short term deposits (100,000) (700,000)
----------- -----------
INCREASE IN CASH 10 60,935 10,353
----------- -----------
The notes on pages 24 to 32 form part of these financial
statements.
Notes to the financial statements
The following accounting policies have been applied consistently
in dealing with items which are considered material in relation to
the Company's financial statements.
1. ACCOUNTING POLICIES
(a) Accounting convention
The financial statements of the Company have been prepared under
the historical cost convention, modified for the revaluation of
fixed asset investments, and in accordance with applicable approved
accounting standards (UK Generally Accepted Accounting
Practices).
The Company is not part of a larger group and does not prepare
consolidated financial statements, and accordingly has elected to
prepare accounts under UK Generally Accepted Accounting Practices
in accordance with article 395 of the Companies Act 2006.
Having undertaken all the appropriate procedures and assessing
the financial position as at the year end, performance and results
for the financial year, the directors have a reasonable expectation
that the Company has adequate resources to continue in operational
existence for the foreseeable future. Thus they continue to adopt
the going concern basis of accounting in preparing the annual
financial statements.
(b) Foreign currencies
Transactions in foreign currencies are recorded in Ringgit
Malaysia (RM) at rates ruling at the transaction dates. Assets and
liabilities are reported at the rates prevailing at the balance
sheet date except for share capital which remains at the historical
rate. Exchange gains and losses are included in the profit and loss
account.
(c) Employee Benefits
Short term benefits
Wages, salaries, bonuses and social security contributions are
recognised as an expense in the year in which the associated
services are rendered by employees of the Company. Short term
accumulating compensated absences, such as paid annual leave, are
recognised when services are rendered by employees that increases
their entitlement to future compensated absences and short term
non-accumulating compensated absences, such as sick leave, are
recognised when the absences occur.
(d) Taxation
The charge for taxation is based on the profit for the year and
takes into account taxation deferred because of timing differences
between the treatment of certain items for taxation and accounting
purposes.
1. ACCOUNTING POLICIES (Cont'd)
Taxation (Cont'd)
Deferred tax is recognised, without discounting, in respect of
all timing differences between the treatment of certain items for
taxation and accounting purposes which have arisen but not reversed
by the balance sheet date, except as otherwise required by FRS
19.
A deferred tax asset is recognised only to the extent that it is
probable that future taxable profits will be available against
which the asset can be utilised.
(e) Loans, receivables and payables
Short term debtors are classified as loans and receivables, as
defined in Financial Reporting Standard 26 Financial instruments:
recognition and measurement, and are measured at amortised cost
less any provision for impairment.
Payables are initially recognised at fair value, and
subsequently, measured at amortised cost.
(f) Income
Interest income is recognised on an accrual basis.
Dividend income is recognised when the right to receive payment
is established.
(g) Cash and liquid resources
Cash, for the purpose of the cash flow statement, comprises cash
in hand and deposits repayable on demand less overdrafts payable on
demand, if any. Liquid resources are current assets investments
which are disposable without curtailing the business and are either
readily convertible into known amounts of cash at or close to their
carrying values or traded in an active market.
(h) Investments
The Company's investments are quoted equity investments and are
classified as available-for-sale financial assets. Subsequent to
initial recognition, they are measured at fair value and changes
therein, other than impairment loss, are recognised directly in
equity. All impairment losses are recognised in the profit and loss
account.
When an investment is derecognised, the cumulative gain or loss
previously recognised in equity is recognised in the profit and
loss account.
2. NOTES TO THE PROFIT AND LOSS ACCOUNT
The profit on ordinary activities before taxation is stated
:
2015 2014
RM RM
After charging:
Directors' remuneration *
- Chew Sing Guan 1,287 1,242
- Haji Zambri Bin Haji Mahmud 1,073 1,036
- Diong Chin Teck 1,073 1,036
- Chew Beow Soon 1,073 1,036
Auditor's remuneration
- Audit of these financial statements 121,883 40,045
and after crediting:
Interest income 359,721 334,178
Dividend income 46,332 60,063
Gain on disposal of investments 37,186 149,681
* Directors' remuneration totaling RM4,506 (2014 : RM4,350) is
in respect of directors' fees for duties performed outside the
United Kingdom.
3. TAX ON PROFIT ON ORDINARY ACTIVITIES
2015 2014
RM RM
Foreign taxation
- current year 68,347 67,166
- prior year (496) -
------- -------
67,851 67,166
------- -------
3. TAX ON PROFIT ON ORDINARY ACTIVITIES (Cont'd)
The current tax charge for the year is higher than the standard
rate of corporation tax in the UK of 21% (2014 : 23%). The
differences are explained below.
Reconciliation of effective tax
expense
2015 2014
RM RM
Profit before tax 194,882 388,504
--------- ---------
Current tax at 21% (2014 : 23%) 40,925 89,356
Expenses not deductible for tax
purposes 48,378 33,955
Income not subject to tax (17,539) (46,070)
Lower tax rates on overseas earnings (3,417) (10,075)
Over provided in prior years (496) -
--------- ---------
67,851 67,166
--------- ---------
4. BASIC AND DILUTED PROFIT PER ORDINARY SHARE OF 10P EACH
This is based on the profit after tax of RM127,031 (2014 :
RM321,338) and 1,713,334 shares (2014 : 1,713,334 shares), being
the weighted average number of shares in issue. The basic profit
per ordinary share is calculated using a numerator of the net
profit for the year and a denominator of the weighted average
number of ordinary shares in issue for the year. There is no
difference in 2015 or 2014 between the basic and diluted profit per
share as there are no potentially dilutive shares, including share
options and warrants, to convert.
5. INVESTMENTS
2015 2014
RM RM
At beginning of year 1,106,044 1,395,641
Additions 7,194 31,367
Change in fair value 32,630 68,963
Disposals (43,588) (389,927)
At end of year 1,102,280 1,106,044
---------- ----------
6. CREDITORS: Amounts falling due within one year
2015 2014
RM RM
- Other creditors 50,055 47,185
- Taxation and social security 427,871 426,027
-------- --------
477,926 473,212
-------- --------
Included in taxation and social security is an amount of
RM414,524 (2014 : RM414,524) representing a provision for the real
property gain tax arising from the sale of the plantation in
2006.
7. SHARE CAPITAL
2015 2014
RM RM
Authorised
2,000,000 ordinary shares of 10p
each 1,493,610 1,493,610
---------- ----------
Issued and fully paid up
1,713,334 ordinary shares of 10p
each 1,067,846 1,067,846
---------- ----------
8. RESERVES
Fair value Profit and
reserve loss account
RM RM
At 1 April 2014 254,548 9,786,397
Profit for the year - 127,031
Unrealised gains on investments 32,630 -
---------- -------------
At 31 March 2015 287,178 9,913,428
---------- -------------
9. RECONCILIATION OF OPERATING LOSS TO NET CASH OUTFLOW FROM OPERATING ACTIVITIES
2015 2014
RM RM
Operating loss (248,357) (155,418)
Increase in creditors 2,870 7,135
Net cash outflow from operating
activities (245,487) (148,283)
---------- ----------
10. RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS
2015 2014
RM RM
Increase in cash in the year 60,935 10,353
Increase in liquid resources 100,000 700,000
----------- -----------
Movement in net funds in the
year 160,935 710,353
Net funds at 1 April 10,440,230 9,729,877
----------- -----------
Net funds at 31 March 10,601,165 10,440,230
----------- -----------
11. ANALYSIS OF NET FUNDS
At 1 April At 31 March
2014 Cash flow 2015
RM RM RM
Short term deposits 10,300,000 100,000 10,400,000
Cash at bank and in
hand 140,230 60,935 201,165
----------- ---------- ------------
10,440,230 160,935 10,601,165
----------- ---------- ------------
12. EMPLOYEES
2015 2014
RM RM
Wages and salaries 1,287 1,242
------ ------
Average number of staff
employed during the year 1 1
------ ------
13. FINANCIAL INSTRUMENTS
(a) Financial risk management objectives and policies
The Company's financial risk management policies seek to ensure
that adequate financial resources are available for the development
of the Company's business whilst managing its interest rate,
foreign exchange, liquidity and credit risks. The Company operates
within clearly defined guidelines that are approved by the Board of
directors and the Company's policy is not to engage in speculative
transactions.
(b) Interest rate risk
The Company's primary interest rate risk relates to
interest-earning assets as the Company had no long-term
interest-bearing debts as at 31 March 2015. The investments in
financial assets are mainly short term in nature and they are not
held for speculative purposes but have been mostly placed in fixed
deposits.
Effective interest
rate per annum Total Within 1 year
Financial Assets % RM RM
2015
Short term deposits 3.73 10,400,000 10,400,000
2014
Short term deposits 3.32 10,300,000 10,300,000
(c) Foreign exchange risk
The Company operates in Malaysia and is only exposed to the
sterling pound currency for payments made to UK companies for
services rendered to the Company. This poses minimum risk as the
level of these payments is not significant.
(d) Liquidity risk
The Company actively manages its operating cash flows and
availability of funds so as to ensure that all repayment and
funding needs are met. As part of its overall prudent liquidity
management, the Company maintains sufficient levels of cash or
readily convertible investments to meet its working capital
requirements.
13. FINANCIAL INSTRUMENTS (Cont'd)
(e) Credit risk
The Company's maximum credit risk exposure is the fair value of
its cash and cash equivalents, presented in note 11 of RM10,601,165
and RM10,440,230 at 31 March 2015 and 2014 respectively. Bank
balances are held with reputable and established financial
institutions.
The Company's principal financial asset is cash and short term
deposits and credit risk arises from cash and short term deposits
with banks and financial institutions.
It is the Company's policy to monitor the financial standing of
these institutions on an on going basis.
(f) Fair values
The fair values of financial assets and financial liabilities
reported in the balance sheet approximate to the carrying amounts
of those assets and liabilities.
(g) Price risk
The Company is exposed to equity price risk in relation to its
fixed asset investments, all of which are listed on the Malaysian
Stock Exchange. A five percent increase in Malaysian equity prices
at the reporting date would have increased equity by RM55,000 (2014
: RM55,000); an equal change in the opposite direction would have
decreased equity by RM55,000 (2014: RM55,000).
(h) Cash flow risk
The Company's assets comprise of cash and short term deposits
all of which earn interest. There is minimum risk on the cash flow.
Cash flow monitoring is a high priority with the management.
(i) Capital management
The Company's policy is to maintain a strong capital base so as
to maintain investor, creditor and market confidence and to sustain
the future development of the business. The Company is not subject
to externally imposed capital requirements. There were no changes
in the Company's approach to capital management in the year.
14. RELATED PARTY TRANSACTIONS AND BALANCES
The related party transactions undertaken by the Company during
the financial year are as follows:
2015 2014
RM RM
Agency fees and accounting fees paid
to
Plantation Agencies Sdn. Berhad,
a company in which Chew Sing Guan,
director,
of the company is also a director 27,984 27,984
------- -------
14. RELATED PARTY TRANSACTIONS AND BALANCES (Cont'd)
Purchases and sales of quoted shares
through 2015 2014
Mercury Securities Sdn. Bhd. ("MSSB"), RM RM
a company in which, Chew Sing Guan,
director,
has a substantial financial interest
* Purchases of quoted shares - 31,367
------- --------
* Sales of quoted shares 80,774 539,608
------- --------
The terms and conditions for the above transactions are based on
normal trade terms.
In the opinion of the directors there is no controlling or
ultimate controlling party at the year end.
Comparative statistics- non audited
Year ended 31 March 2015 2014 2013 2012 2011
--------------------------- ----------- ----------- ----------- ----------- -----------
RM RM RM RM RM
BALANCE SHEET ANALYSIS
Called-up share capital 1,067,846 1,067,846 1,067,846 1,067,846 1,067,846
Reserves 10,200,606 10,040,945 9,650,644 9,562,954 9,460,689
----------- ----------- ----------- ----------- -----------
Total shareholders' funds 11,268,452 11,108,791 10,718,490 10,630,800 10,528,535
----------- ----------- ----------- ----------- -----------
Investments 1,102,280 1,106,044 1,395,641 1,335,965 1,180,516
Net current assets 10,166,172 10,002,747 9,322,849 9,294,835 9,348,019
11,268,452 11,108,791 10,718,490 10,630,800 10,528,535
----------- ----------- ----------- ----------- -----------
PROFIT AND LOSS
ACCOUNT ANALYSIS
(Loss)/profit before
interest and taxation (164,839) 54,326 (132,833) (92,418) (123,846)
Interest receivable 359,721 334,178 322,571 311,338 273,158
Taxation (67,851) (67,166) (61,198) (64,530) (57,712)
Profit after taxation 127,031 321,338 128,540 154,390 91,600
--------------------------- ----------- ----------- ----------- ----------- -----------
Proxy form HIDONG ESTATE PLC
I/We
--------------------------------------------------------------------------------------
of
----------------------------------------------------------------------------------------------
In Block being a member(s) of HIDONG ESTATE PLC hereby appoint
#Mr. Chew Sing Guan or failing him,
Capitals Tuan Haji Zambri bin Haji
Mahmud or failing him ,
----------------------------------------------------------
as my/our proxy to vote for me/us and on my/our behalf
at the annual general meeting of the Company to be
held on 28(th) day of September 2015 and at any adjournment
thereof, in the manner indicated below:-
Please indicate Resolution relating to :- For Against
how you
wish your
vote to
be cast
------------------------------------------------------- --------------------- ---------------------
1. To receive and consider the
audited financial statements
and the reports of the directors
and auditors thereon for the
year ended 31 March 2015.
------- ---------------------------------------------- --------------------- ---------------------
2. To re-elect Mr. Diong Chin Teck
who retires in accordance with
article 108 of the Company's
Articles of Association, and
being eligible, offers himself
for re-election.
------- ---------------------------------------------- --------------------- ---------------------
3. To re-appoint KPMG LLP as auditors
and authorise the directors
to fix their remuneration.
------- ---------------------------------------------- --------------------- ---------------------
4. To approve the Directors' Remuneration
Report for the year ended 31
March 2015.
------- ---------------------------------------------- --------------------- ---------------------
5. To approve the Directors' Remuneration
Policy.
------- ---------------------------------------------- --------------------- ---------------------
6. To approve the following non-executive
directors who have served as
independent non-executive directors
for a cumulative term of more
than nine (9) years to continue
to act as independent non-executive
directors of the Company:-
* Tuan Haji Zambri bin Haji Mahmud
* Mr. Diong Chin Teck
* Mr. Chew Beow Soon
------- ---------------------------------------------- --------------------- ---------------------
Number of shares held ...................
Dated this ................ day of ................................... Signature .................................
2015
Note :
1. # If it is desired to appoint another person as a proxy,
these names should be deleted and the name of the proxy, who need
not be a member of the Company, should be inserted in block
capitals, and the alteration should be initialled.
2. This proxy to be valid, must be deposited at the head office
of the Company, "Hidong Estate Plc, Third Floor, Standard Chartered
Bank Chambers, Beach Street, 10300 Penang, Malaysia" not less than
48 hours before the time appointed for holding the meeting.
3. In the case of a corporation, the proxy must be executed
under its common seal, or under the hand of a duly authorised
officer. If executed under the hand of a duly authorised officer,
evidence of such authority must be produced with the proxy
form.
4. In the case of joint holders, the signature of any one joint holder is sufficient.
5. If neither "FOR" nor "AGAINST" is indicated above, the proxy
will vote or abstain as he thinks fit.
6. To appoint more than one proxy you may photocopy this form.
Please indicate the proxy holder's name and the number of shares in
relation to which they are authorised to act as your proxy (which,
in aggregate, should not exceed the number of shares held by you).
Please also indicate if the proxy instruction is one of multiple
instructions being given. All forms must be signed and should be
returned together in the same envelope.
Please fold across the line and close
Please Affix Stamp Here
To:
HIDONG ESTATE PLC (990786-V)
THIRD FLOOR
Standard Chartered Bank Chambers
Beach Street
10300 Penang
Malaysia
Please fold across the line and close
Annual Report 2015
This information is provided by RNS
The company news service from the London Stock Exchange
END
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