contents annual report 2012 01 corporate information 02 board of directors’ profile 03 corporate...

CONTENTS

ANNUAL REPORT 2012 01

Corporate Information 02Board of Directors’ Profile 03Corporate Structure 05Audit Committee 06Corporate Governance Statement 09Statement on Internal Control 13Other Compliance Statements 15Chairman’s Statement 16Directors’ Report 22Statement by Directors 26Independent Auditors’ Report 27Statements of Financial Position 29Statements of Comprehensive Income 31Statements of Changes in Equity 32Statements of Cash Flows 35Notes to the Financial Statements 38Analysis of Shareholdings 110List of Properties 114Notice of Annual General Meeting 115Proxy Form

CORPORATE INFORMATION

ANNUAL REPORT 201202

DIRECTORS LIM TEIK HIAN I EXECUTIVE CHAIRMAN IJIMMY ONG CHIN KENG I MANAGING DIRECTOR ILIM TECK CHYE I EXECUTIVE DIRECTOR IWONG SEW YUN I NON EXECUTIVE DIRECTOR ING CHEE KONG I NON EXECUTIVE DIRECTOR IWONG THAI SUN I NON EXECUTIVE DIRECTOR I

SECRETARIES LEE PENG LOONP’NG CHIEW KEEM

REGISTERED OFFICE 51-21-A MENARA BHL BANKJALAN SULTAN AHMAD SHAH10050 PENANGTEL : (60) 4 210 8833FAX : (60) 4 210 8831

SHARE REGISTRAR TRICOR INVESTOR SERVICES SDN BHD (118401-V)LEVEL 17, THE GARDENS NORTH TOWERMID VALLEY CITY, LINGKARAN SYED PUTRA59200 KUALA LUMPUR, MALAYSIATEL: (60) 3 2264 3883FAX: (60) 3 2282 1886

AUDIT COMMITTEE WONG THAI SUN I CHAIRMAN AND INDEPENDENT NON EXECUTIVE DIRECTOR ING CHEE KONG I INDEPENDENT NON EXECUTIVE DIRECTOR IWONG SEW YUN I INDEPENDENT NON EXECUTIVE DIRECTOR I

PRINCIPAL BANKERS CIMB BANK BERHAD (13491-P)HSBC BANK MALAYSIA BERHAD (127776-V)MALAYAN BANKING BERHAD (3813-K)

AUDITORS BDOCHARTERED ACCOUNTANTS51-21-F MENARA BHL BANKJALAN SULTAN AHMAD SHAH10050 PENANG

STOCK EXCHANGE LISTING BURSA MALAYSIA MAIN MARKET

STOCK NAME EMICO

STOCK CODE 9091

SECTOR CONSUMER PRODUCTS

BOARD OF DIRECTORS’ PROFILE


from right to left :Mr Lim Teck Chye, Mr Ng Chee Kong, Mr Jimmy Ong Chin Keng, Mr Lim Teik Hian, Mr Wong Sew Yun, Mr Wong Thai Sun

LIM TEIK HIAN I Executive Chairman

Mr Lim Teik Hian, a Malaysian aged 45 was appointed to the Board on 16 February 1996. He has aDiploma in Business Administration from Australia Business College, Melbourne, Australia. Upongraduation, he joined the Company in 1989 as the Marketing Manager and was responsible for thedevelopment of domestic market for Emico. At a later stage, he was involved in the general managementof the manufacturing concern and was instrumental in the commissioning of modern manufacturingfacilities for Emico Group. He was re-designated as Executive Chairman on 24 March 2009. He and hisyounger brother, Mr Lim Teck Chye sits on the Board of the Company as Executive Director. He is amember of Emico’s Nominating Committee. Other than as disclosed in the related party transactionsin Note 36 of the Financial Statements, he has no other conflict of interest.

Mr Lim has not been convicted of any offence in the past 10 years and has attended all Board meetings heldduring the financial period.

JIMMY ONG CHIN KENG I Managing Director

Mr Jimmy Ong Chin Keng, a Malaysian aged 49 was appointed to the Board on 16 February 1996. He is a CharteredAccountant and holds a professional qualification from the Malaysian Institute of Certified Public Accountantsand is a member of Malaysian Institute of Accountants. He joined Emico Group in February 1993 as the FinancialController and rose to the rank of Finance Director in 1996 and re-designated as Managing Director on 23 January2009. Mr Ong has an extensive experience and knowledge in the field of accounting, finance, corporate finance,manufacturing and property development. Prior to his engagement in Emico, he served in two internationalaccounting firms namely PriceWaterhouseCoopers and KPMG for a total of 8 years. Mr Ong has no familyrelationship with any Director/Substantial shareholders. He is a member of Emico’s Remuneration Committeeand sits on the Board of several private limited companies. Other than as disclosed in the related party transactionsin Note 36 of the Financial Statements, he has no other conflict of interest.

Mr Ong has not been convicted of any offence in the past 10 years and has attended all Board meetings heldduring the financial period.

BOARD OF DIRECTORS’ PROFILE


LIM TECK CHYE I Executive Director

Mr Lim Teck Chye, a Malaysian aged 38, was appointed to the Board on 11 May 2004. He graduatedfrom University of Toledo, Ohio, USA in Bachelor of Science in Engineering and Master of Science inIndustrial Engineering. Upon graduation, he joined Fuji Lift & Escalator Manufacturing Sdn. Bhd.(formerly known as Northern Elevator Manufacturing Sdn Bhd) as its Marketing Manager in July 1997.In mid 1998, he was transferred abroad to set up an elevator manufacturing plant in Fujian province,China. The China factory is in full operation since July 1999 and has obtained ISO 9001:2000 qualitycertification. He was appointed to the Board of NEB Development Berhad formerly known as NorthernElevator Berhad as the Executive Director in October 1999 and has held the position since then. Heand his brother, Mr Lim Teik Hian sits on Board of the Company as Executive Director and ExecutiveChairman respectively. Other than as disclosed in the related party transactions in Note 36 of theFinancial Statements, he has no other conflict of interest.

Mr Lim has not been convicted of any offence in the past 10 years and has attended 5 out of 6 Boardmeetings held during the financial period.

NG CHEE KONG I Independent and Non-Executive Director

Mr Ng Chee Kong, a Malaysian aged 69 is an Independent Non-Executive Director of the Company.He was appointed to the Board on 24 May 1999 and is a member of the Audit and the RemunerationCommittee. He also sits as the Chairman of the Nominating Committee. He received his early educationin Penang and joined the banking profession with a major local bank until his retirement 36 yearslater. During his tenure with the bank, he obtained a Diploma in Marketing & Selling Bank Servicesconferred by The International Management Centres, Buckingham, England.

Mr Ng has not been convicted of any offence in the past 10 years and has attended all Board meetingsheld during the financial period.

WONG SEW YUN I Independent and Non-Executive Director

Mr Wong Sew Yun, a Malaysian aged 56 was appointed to the Board on 14 January 1995. He has beeninvolved in business for more than 28 years. He has his own business operating a transportationcompany plying East, West Malaysia and Indonesia. He is also involved in ceramic wares business andsits on the Board of several private limited companies.

Mr Wong has not been convicted of any offence in the past 10 years and has attended all Boardmeetings held during the financial period.

WONG THAI SUN I Independent and Non-Executive Director

Mr Wong Thai Sun, a Malaysian aged 57 was appointed to the Board on 26 December 2008. He holdsa Bachelor of Economics and Accountancy from Australia National University. He is a member of theMalaysian Institute of Accountants and the Certified Public Accountants, Australia. He has publicpractice experience in accountancy for over 20 years in Malaysia and in overseas and is currentlyhaving his own public practice firm, which is Wong Thai Sun & Associates. He is also a director ofD’Nounce Technology Bhd and Suiwah Corporation Bhd.

Mr Wong has not been convicted of any offence in the past 10 years and has attended all Boardmeetings held during the financial period.

AS AT 31 MARCH 2012


CORPORATE STRUCTURE

PROPERTY DEVELOPMENT & INVESTMENT

100% Emico Development Sdn Bhd

100% Emico Capital Sdn Bhd

71% Mercu Tanah Langkawi Sdn Bhd

60% NEB Development Berhad

49.7% Operasi Tembaga Sdn Bhd

39.8% PKB - Operasi Tembaga Sdn Bhd

60%** NEB Pacific Sdn Bhd

60% ** Unic Builders Sdn Bhd

50% ** Panashiba Industries (M) Sdn Bhd

TRADING

100% Emico Asia Sdn Bhd

51% Emico Melaka Sdn Bhd

100% ** Emico Newk Sdn Bhd

MANUFACTURING

Consumer Products

100% Emico Penang Sdn Bhd

100% Emico Marketing Sdn Bhd

100% Emico Metalizing Sdn Bhd

100%** Emico Creative Design Sdn Bhd

100%** Emico Tools Sdn Bhd

53.3%** Standard Trend Apparel Industries Sdn Bhd

24.5%** PT Panashiba Industries, Indonesia

Lifts and Escalators

24%** Asian Elevator (M) Sdn Bhd

18%** Jiangnan Escalator (M) Sdn Bhd

Subsidiary Companies

Associated Companies** Dormant / Inactive

EMICO HOLDINGSB E R H A D

AUDIT COMMITTEE


The Board has appointed the Audit Committee to assist the Board in discharging its duties ofmaintaining a sound system of internal controls to safeguard shareholders’ investment and the Group’sassets.

TERMS OF REFERENCE

• PurposeThe primary objective of the Audit Committee (as a sub-committee of the Board) is to assist theBoard in the effective discharge of its fiduciary responsibilities for corporate governance, financialreporting and internal control.

• Reporting ResponsibilitiesThe Audit Committee will report to the Board on the nature and extent of the functions performedby it and may make such recommendations to the Board on any audit and financial reportingmatters as it may think fit.

• Attendance at MeetingThe head of finance, the head of internal audit and a representative of external audit shallnormally attend meetings. The Company Secretary shall be the Secretary of the Audit Committee.Other board members or employees may be invited to brief the Audit Committee on issues thatare incorporated into the agenda.

• Frequency of MeetingThe Committee will meet as frequently as the Chairman shall decide, with due notice of issuesto be discussed and shall record its conclusions whilst discharging its duties and responsibilities.

The Audit Committee should meet with the external auditors without executive board memberspresent at least twice a year.

The Chairman of the Audit Committee should engage on a continuous basis with seniormanagement, such as the chairman, chief executive officer, the finance director, the head of theinternal audit and the external auditors in order to be kept informed of matters affecting theCompany.

• QuorumThe quorum for a meeting shall be 2 (two) members, the majority of whom shall be independentdirectors.

• AuthorityThe Audit Committee is authorised by the Board to investigate any activity within its terms ofreference. The Audit Committee shall have unrestricted access to both the internal and externalauditors and to all employees of the Group. The internal audit function reports directly to theAudit Committee. The Audit Committee may, with the approval of the Board, consult legal orother professionals where they consider it necessary to discharge their duties.

No. Name Status of Independence Attendancedirectorship Status of meetings

(i) Wong Thai Sun Non-Executive Independent 6/6(Chairman)

(ii) Ng Chee Kong Non-Executive Independent 6/6(Member)

(iii) Wong Sew Yun Non-Executive Independent 6/6(Member)


AUDIT COMMITTEE

MEMBERSHIP AND MEETINGSThe composition of the Company’s Audit Committee, appointed by the Board from amongst itsmembers, comprises of 3 (three) members of which all are Non-Executive Directors.

Membership

• The members of the Audit Committee shall be appointed by the Board.• The Audit Committee shall consist of not less than three (3) members of whom:

a) all members of the Audit Committee must be non-executive directors with a majority of thembeing independent directors;

b) at least one (1) member of the Audit Committee:i) must be a member of the Malaysian Institute of Accountants; orii) if he or she is not a member of the Malaysian Institute of Accountants,

a) he or she must have at least three (3) years’ working experience; and• he or she must have passed the examinations specified in Part I of the First Schedule

of the Accountants Act, 1967; or• he or she must be a member of one (1) of the associations of accountants specified

in Part Il of the First Schedule of the Accountants Act, 1967; oriii) he or she fulfils such other requirements as prescribed or approved by Bursa Securities.

c) all members of the Audit Committee should be financially literate.• No alternate director shall be appointed as a member of the Audit Committee.• The Chairman of the Audit Committee shall be appointed by the members of the Audit Committee

among their member who is an independent director.• The Board must review the term of office and performance of the Audit Committee and each of

its members at least once every three (3) years to determine whether such Committee and membershave carried out their duties in accordance with their terms of reference.

• The Board shall, within three (3) months of a vacancy occurring in the Audit Committee whichresult in the number of members reduced to below three (3), appoint such number of new membersas may be required to make up the minimum number of three (3) members.

Meetings

During the financial period from 1 January 2011 to 31 March 2012, the Committee held meetings on28 February, 15 April, 30 May, 26 August, 25 November 2011 and 28 February 2012 respectively,making a total of 6 (six) meetings.

AUDIT COMMITTEE


DUTIES AND RESPONSIBILITIES

The primary goal of the Committee is to review the financial condition of the Group, its internal controls,performance and findings of the internal auditors and to recommend appropriate remedial action.The primary duties and responsibilities of the Committee are as follows:• to review both the internal and external auditor’s scope of audit plan, their evaluation of the system

of internal controls and audit reports.• to review and evaluate the adequacy of the scope, functions, competency and resources of the

internal audit functions and that it has the necessary authority to carry out its work.• to consider the appointment and/or reappointment of external and internal auditors, their fees

and any question of their resignation or dismissal and to recommend to the Board.• to nominate, for the approval of the Board of Directors, a person or persons as auditor(s).• to review the assistance and co-operation given by the Company’s officers to the external and

internal auditors.• to review the quarterly and year end financial statements before submission to the Board of Directors,

focusing particularly on:a) changes in or implementation of major accounting policy changesb) significant and unusual events; andc) compliance with accounting standards and other legal requirements.

• to review any related party transactions that may arise within the Company or the Group.• to consider adequacy of Management’s actions taken on internal and external audit reports.• to review the allocation of shares to employees under the Employees’s Share Option Scheme.

SUMMARY OF ACTIVITIES OF THE AUDIT COMMITTEE

During the financial period from 1 January 2011 to 31 March 2012, the Committee held meetings on 28February, 15 April, 30 May, 26 August, 25 November 2011 and 28 February 2012 respectively, making atotal of 6 (six) meetings. The committee also appraised the adequacy of actions taken by the Managementin resolving the reported audit issues and in implementing suggested improvement measures.

On quarterly basis and financial year end, the Committee reviewed the financial statements prepared by theManagement for proper approval by the Board on its announcements. Any significant issues resulting from theaudit of the financial statements by the External Auditors were noted by the Committee.

The Committee, at the conclusion of each meeting, recommended the Management to improve oninternal controls, procedures and systems of the Company, where deemed appropriate.

Reviewed and considered the disclosure of Related Party Transactions in the Financial Statements and theRecurrent Related Party Transactions Circular to shareholders.

Reviewed the Statement of Corporate Governance and Statement on Internal Controls.

ACTIVITIES OF INTERNAL AUDIT

The role of the Internal Auditors is to examine, evaluate and ensure compliance with the Group’s policies,procedures and system of internal controls so as to provide reasonable assurance that such system continueto operate effectively in the Emico Group of Companies. The Internal Auditors work focuses on areas ofpriority as identified in accordance with the annual audit plan approved each year by the Audit Committee.For the financial period from 1 January 2011 to 31 March 2012, audit visits were conducted in all activesubsidiaries of the Group.

The audit activities were as follows:a. ascertaining the extent of compliance with the established policies, procedures and statutory

requirements;b. reviewing of new systems and modified systems to ensure that proper controls exist in the

systems or where certain necessary controls were absent, to prescribe controls beforeimplementation; and

c. identifying opportunities to improve the operations and the processes in the Company andthe Group.

The Internal Auditors reports their audit findings to the Audit Committee and the Management of therespective subsidiaries.


CORPORATE GOVERNANCE STATEMENT

The Board of Directors of Emico Holdings Berhad is committed to ensuring that the Group is movingtowards the highest standards of Corporate Governance in discharging its responsibilities to protectand enhance shareholders value and the Group’s financial performance.

Currently, the Board is moving towards full compliance with all the principles in Part 1 of the MalaysianCode on Corporate Governance and is also committed to ensuring adoption of the Best Practice asrecommended in Part 2 of the Code.

The BoardThe Board consists of the following members:

> one executive chairman> two executive directors> three independent non-executive directors

The Board of Directors is leading and controlling the Group while the Company’s Executive Chairmanand Managing Director has the responsibility for the running of the Group’s businesses.

Board MeetingThere were six Board Meetings held during the financial period from 1 January 2011 to 31 March 2012and the attendance of the Directors were as follows:

Name of Director Directorship AttendanceLim Teik Hian Executive Chairman 6/6Jimmy Ong Chin Keng Managing Director 6/6Lim Teck Chye Executive Director 5/6Wong Sew Yun Independent Non-Executive Director 6/6Ng Chee Kong Independent Non-Executive Director 6/6Wong Thai Sun Independent Non-Executive Director 6/6

Supply Of InformationThe Board is able to access a complete information in a timely basis in form and of a quality necessaryfor the discharge of their duties and responsibilities. Where required, the Board has the authority tosource for independent or expert advice and views from outside the Group.

Appointment and Re-election of The BoardAll Directors are required to submit themselves for re-election at least every three years.

The Board is responsible for the appointments of Directors and determining the remuneration packageof each Director. In order to improve its effectiveness, the Board had set up a Nominating and aRemuneration Committee which consist of the following:

Nominating CommitteeChairmanMr Ng Chee Kong I Independent and Non-Executive Director

MemberMr Lim Teik Hian I Executive Chairman

Mr Wong Thai Sun I Independent and Non-Executive Director

The principal objectives of the Nomination Committee are as follows:(a) to assess and recommend suitable candidates for appointment to the Board, Board

Committees and Board of subsidiary companies.(b) to review the qualities (including skills and experience) of the Non-Executive Directors of

the Company.(c) to assess the effectiveness of the Board of Directors of the company as a whole, its

committees and the contributions of each individual director.

Remuneration CommitteeChairmanMr Ng Chee Kong I Independent and Non-Executive Director

MemberMr Wong Thai Sun I Independent and Non-Executive Director

Mr Jimmy Ong Chin Keng I Managing Director

The objective of the Remuneration Committee is to recommend to the Board, the remunerationpackage of the Executive Directors are fairy rewarded for their contribution to overall performanceof the Group.

DIRECTORS’ REMUNERATION

Directors do not participate in decisions regarding their own remuneration. Directors’ fee andemoluments are endorsed by the Board and approved by shareholders of the Company at AnnualGeneral Meeting.

The remuneration of the Directors for the financial period from 1 January 2011 to 31 March 2012 isas follows.

Fee Salaries and other Benefits-in-kindemoluments

RM RM RMExecutive Directors 37,500 928,290 17,400Non- Executive Directors 37,500 14,250 -Total 75,000 942,540 17,400

The number of Directors whose remuneration fall into the respective bands are as follows:

Range of Remuneration (RM) Executive Non-Executive25,000 & below 1 3300,001 - 350,000 1 -450,001 - 500,000 1 -



DIRECTORS’ TRAINING AND EDUCATION

On joining, all new directors are given background information describing the Company and itsactivities. Site visits are arranged whenever necessary. All the Directors holding office have completedthe Mandatory Accreditation Programme as specified by Bursa Securities. The Directors are alsoencouraged to attend various external professional programmes on a continuous basis to enablethem to discharge their duties and to ensure that they are kept abreast on various issues facing thechanging business environment within which the Group operates.

The Directors have during the financial period from 1 January 2011 to 31 March 2012, evaluated theirown training needs on a continuous basis and attended the following programmes:

Director’s name Training ProgrammeJimmy Ong Chin Keng Strategy Day Planning Retreat - Federation of Malaysian Manufacturers, Penang

Strategic Trade Act 2010 by MITIMatrade Seminar on “12 Steps to Successful Exporting”NCIA Economic Transformation Programme NCER Lab workshopTax Seminar “Shaping Sustainable Growth”Invest Penang Talk on SME CentreSME Financing Course by UPEN (State Economic Planning unit) & FMMIndustry Briefing on Penang SME CentreNetherlands Your Gateway to Europe by Netherland Embassy

Lim Teck Chye Sales workshop for Lift Modernization and Upgrading BusinessSales and Negotiation Skills Workshop for Lift Service, Maintenance and SmallRepairsLeadership Skills TrainingCustomer Relationship Management Skills Training

Ng Chee Kong Strategy Day Planning Retreat - Federation of Malaysian Manufacturers, PenangAnti-Competition ActBank Negara Renminbi Trade Settlement TalkStrategic Trade Act 2010 by MITIMatrade Seminar on “12 Steps to Successful Exporting”SME Financing Course by UPEN (State Economic Planning unit) & FMMBank of Tokyo Mitsubishi UFJ Forex & Economic Seminar

Wong Thai Sun New Public Rulings Issued in 2009 & 2010Tax Planning for Employers and HR ManagersSales Tax & Service Tax and Its Implication on the Introduction of Goods & ServiceTax (GST)

Lim Teik Hian In-house Program

Wong Sew Yun In-house Program

SHAREHOLDERS

The Group has always placed high emphasis on communication with its shareholders on any majordevelopments of the Group on a timely basis. This is achieved through regular quarterly and annualreports, and announcements.

The principal forum for dialogue with shareholders is at General Meeting, where investors are alsoencouraged to participate and pose questions to the Board on matters relating to operational andfinancial information.





ACCOUNTABILITY AND AUDIT

In presenting and reporting the annual reports and the quarterly announcement to shareholders, theBoard has presented a balanced and understandable assessment of the Group’s position and prospects.

The Board acknowledges its duty and responsibility for maintaining a sound system of internal controlto safeguard shareholders’ investment and the Group’s assets. It has established an Audit Committeecomprising three (3) directors, the majority of whom are independent, to perform internal controlcovering financial, operational and compliance control and risk management necessary for the Groupto achieve its objectives within acceptable risk profile. These controls can only provide reasonablebut not absolute assurance against material misstatement or loss.

The Board has established formal and transparent relationship with the external auditors. Theappointment of the auditors is recommended by Audit Committee and subject to the approval ofthe shareholders in Annual General Meeting. The auditors remuneration is determined by the Boardbut is recommended by the Audit Committee.

STATEMENT OF DIRECTORS’ RESPONSIBILITY

The Directors are required by the Companies Act, 1965 (”the Act”) to prepare financial statements foreach financial year which give a true and fair view of the state of affairs of the Group and the Companyat the end of the financial year and the profit or loss of the Group and the Company for the financialyear. As required by the Act and the Listing Requirements of Bursa Malaysia Securities Berhad, thefinancial statements have been prepared in accordance with the applicable approved accountingstandards in Malaysia and the provisions of the Act.

The Directors consider that in preparing the financial statements for the period from 1 January 2011to 31 March 2012 set out on pages 29 to 109, the Group has used the appropriate accounting policies,consistently applied and supported by reasonable and prudent judgments and estimates. The Directorshave responsibility for ensuring that the Group and the Company keep accounting records whichdisclose with reasonable accuracy the financial position of the Group and the Company which enablethem to ensure that the financial statements comply with the Act. The Directors have generalresponsibility for taking such steps as are reasonably open to them to safeguard the assets of theGroup and to prevent and detect fraud and other irregularities.


STATEMENT ON INTERNAL CONTROL

INTRODUCTION

Pursuant to Paragraph 15.26(b) of the Main Market Listing Requirements of Bursa Malaysia SecuritiesBerhad (“Bursa Securities”), the Board of Directors of Emico Holdings Berhad is pleased to provide thefollowing statement on the state of internal control of the Group, which outlines the nature andscope of internal control of the Group during the financial period 1 January 2011 to 31 March 2012.

RESPONSIBILITY FOR RISK AND INTERNAL CONTROL

The Board recognises the importance of a sound system of internal control and a structuredrisk management framework to good corporate governance. The Board affirms its overallresponsibility for the Group’s system of internal control and for reviewing the adequacy andintegrity of those systems. Because of the limitations that are inherent in any systems ofinternal control, those systems are designed to manage rather than eliminate the risk of failureto achieve business objectives, and can only provide reasonable and not absolute assuranceagainst material misstatement or loss.

Following the publication of The Statement on internal control: Guidance for Directors of public listedcompanies (the “Internal Control Guidance”), the Board affirms that there is an established ongoingprocess for identifying, evaluating and managing the significant risks faced, or potentially exposedto, by the Group in pursuing its business objectives. This process has been in place throughout thefinancial year and up to the date of approval of the annual report. The adequacy and effectivenessof this process have been continually reviewed by the Board.

Although the Board is the ultimate owner of risk assessment and internal control systems of theGroup, Management has been tasked with the implementation of risk management and internalcontrol systems, within the framework adopted by the Board.

RISK MANAGEMENT

The Board and management practice proactive significant risks identification on a quarterly basis orearlier as appropriate, particularly any major proposed transactions, changes in nature of activitiesand/or operating environment, or venturing into new operating environment which may entaildifferent risks, and put in place the appropriate risk response strategies and controls until those risksare managed to, and maintained at, a level acceptable to the Board.

INTERNAL AUDIT FUNCTION

The Board acknowledges the importance of internal audit function and has engaged the services ofan independent professional accounting and consulting firm, internal auditor : Q-West CorporateConsultants Sdn. Bhd. to provide much of the assurance it requires regarding the effectiveness as wellas the adequacy and integrity of the Group’s systems of internal control.

The internal audit adopts a risk-based approach in developing its audit plan which addressesall the core auditable areas of the Group based on their risk profile. Scheduled internal auditsare carried out by the Internal Auditors based on the audit plan presented to and approved bythe Audit Committee. The audit focuses on areas with high risk and inadequate controls toensure that an adequate action plan has in place to improve the controls. For those areas withhigh risk and adequate controls, the audit ascertains that the risks are effectively mitigated by thecontrols. On a quarterly basis or earlier as appropriate, the internal auditors report to the AuditCommittee on areas for improvement and will subsequently follow up to determine the extent oftheir recommendations that have been implemented.

STATEMENT ON INTERNAL CONTROL


INTERNAL CONTROL

Apart from risk management and internal audit, the Group has put in place the following key elementsof internal control:

• An organisation structure with well-defined scopes of responsibility, clear lines of accountability,and appropriate levels of delegated authority;

• A process of hierarchical reporting which provides for a documented and auditable trail ofaccountability;

• A set of documented internal policies and procedures for operational, financial and humanresource management, which is subject to regular review and improvement;

• Regular and comprehensive information provided to management, covering financial andoperational performance and key business indicators, for effective monitoring and decisionmaking;

• A comprehensive business planning and detailed budgeting process where operating unitsprepare budgets for the coming year which are approved both at operating unit level and bythe Board;

• Monthly monitoring of results against budget, with major variances being followed up andmanagement action taken, where necessary; and

• Regular visits to operating units by members of the Board and senior management.

Based on the internal auditors’ report for the financial period from 1 January 2011 to 31 March 2012,there is a reasonable assurance that the Group’s systems of internal control are generally adequateand appear to be working satisfactorily. A number of minor internal control weaknesses were identifiedduring the financial period, all of which have been, or are being, addressed. None of the weaknesseshave resulted in any material losses, contingencies or uncertainties that would require disclosure inthe Group’s annual report.

The Board continues to review and implement measures to strengthen the internal control environmentof the Group.

This statement has been reviewed by the external auditors in compliance with Paragraph 15.23 ofMain Market Listing Requirements of Bursa Securities.

This statement is issued in accordance with a resolution of the Directors dated 20 July 2012.


OTHER COMPLIANCE STATEMENTS

1. Utilisation of ProceedsThere was no capital raising exercise carried out by the Company during the financial period.

2. Share Buy-BacksThe Company has not purchased any of its own shares and as such, there is no treasury sharesmaintained by the Company for share buy-backs.

3. Options, Warrants or Convertible SecuritiesDuring the financial period from 1 January 2011 to 31 March 2012, there were no options, orconvertibles securities exercised by the Company.

4. Depository Receipts ProgrammeDuring the financial period from 1 January 2011 to 31 March 2012, the Company did not sponsorany depository receipts programme.

5. Sanctions And/Or PenaltiesThere were no sanctions and/or penalties imposed on the Company and its subsidiaries, Directorsor management by the relevant regulatory bodies.

6. Non-Audit FeesThe non-audit fee paid/payable to external auditors for the financial period from 1 January 2011to 31 March 2012 was RM2,000.

7. Variation in ResultsThere were no variations of 10% or more between the audited results for the financial periodfrom 1 January 2011 to 31 March 2012 and the unaudited results announced on 30 May 2012.

8. Profit GuaranteeDuring the financial period from 1 January 2011 to 31 March 2012, there was no profit guaranteegiven by the Company.

9. Material ContractsThere were no material contracts entered by the Company and its subsidiaries involving Director'sand major shareholder's interest other than those disclosed in the financial statements.

10. Recurrent Related Party Transactions of a Revenue NatureThere were no material recurrent related party transactions of a revenue nature during thefinancial period from 1 January 2011 to 31 March 2012 other than those disclosed in the financialstatements.

11. Corporate Social Responsibility (CSR)The Group acknowledges that in pursuit of any business objective, there is a need to find abalance between profitability and contributions towards being a socially responsible corporatecitizen. With such belief, the Group is committed and uses its best endeavour, on ongoing basis,to integrate CSR practices into its day to day business operations i.e. constantly review of the staffbenefits to enhance the quality of the life of its employees and adopting eco-friendly practicessuch as recycling to protect the environment.

CHAIRMAN’S STATEMENT


On behalf of the Board of Directors of Emico Holdings Berhad, I am pleased to present herewith theAnnual Report and Accounts of the Group and the Company for the 15 months ended 31 March 2012.

REVIEW OF RESULTS

15 months 12 months Average Average Increase/Ended 31 Ended 31 Per Per (Decrease)

March December quarter quarter Per2012 2010 2012 2010 quarter

RM'000 RM'000 RM'000 RM'000 RM'000 %Turnover by divisionManufacturing division 50,286 34,838 10,057 8,710 1,347 15.5Trading division 23,729 18,373 4,746 4,593 153 3.3Property Development division 13,488 11,519 2,698 2,880 (182) (6.3)Group Turnover 87,503 64,730 17,501 16,183 1,318 8.1Profit/(Loss) before tax by divisionManufacturing division 4,481 2,852 896 713 183 25.7Trading division 450 274 90 69 21 30.4Property Development division (255) 344 (51) 86 (137) (159.3)Investment division (6,210) (2,142) (1,242) (536) (706) (131.7)Group Profit/(Loss) before tax (1,534) 1,328 (307) 332 (639) (192.5)

The Group recorded a turnover of RM87.5 million and loss before tax of RM1.5 million for 15 monthsended 31 March 2012 as compared to RM64.7 million for turnover and profit before tax of RM1.3million for the 12 months ended 31 December 2010. The 8.1% increase in average turnover per quarterwas primarily attributed to the higher turnover from manufacturing and trading divisions. Even thoughwith these divisions achieving a higher turnover, the Group posted a loss before tax for the currentperiod which was attributable to the following reasons:-

(i) Gain on disposal of investment property and leasehold land amounted to RM2.8 million wasincluded in the results for the 12 months ended 31 December 2010 whilst the gain on disposalof subsidiary company amounted to only RM1.0 million was included in the results for the15 months ended 31 March 2012. Therefore, the gain on disposal of investments for the currentperiod decreased by RM1.8 million as compared to previous year.

(ii) Impairment loss on trade receivables, investment properties and developed propertiesamounted to RM1.8 million during the current period as compared to RM0.4 million impairmentfor previous year.

(iii) The interest rate on Redeemable Secured Loan Stocks (RSLS) was increased from 4% perannum to 6% per annum with effect from 1 January 2011 which cause an incremental sumof approximately RM0.7 million per annum on interest cost for the current period.

DIVIDEND

The Board of Directors is not recommending any payment of dividend for the 15 months ended 31March 2012.

REVIEW OF OPERATIONS

The Group's operation is organized into the following divisions:

(i) Manufacturing - consumer products(ii) Trading - household products(iii) Property Development



MANUFACTURING - CONSUMER PRODUCTS

Manufacturing of consumer products which consist of Trophy & OEM division posted a higherturnover of RM50.3 million for 15 months ended 31 March 2012 as compared to RM34.8 millionfor 12 months ended 31 December 2010. On the average per quarter basis, the turnover increasedby RM1.3 million (15.5%) per quarter for 2012 as compared to 2010.

TROPHY DIVISIONThe trophy division posted a substantial increased in turnover to RM28.8 million for 15 monthsended 31 March 2012 as compared to RM18.8 million for 12 months ended 31 December 2010,an increase of RM1.1 million per quarter or 22.6%.

The export of trophy continued its strong growth which started in the second half of year 2010.The consolidation of trophy industry in Europe with the exit of one of the big player has createda huge vacuum and a great opportunity for Emico. The continuous effort and dedication to meetcustomers' requirement of service and quality has enabled Emico to build a large base of distributorsin almost all major European countries. As at to-date, we have supplied to more than 35 countriescovering Asia, Europe, North and South America. Our production capacity has been operating toits maximum capacity and we are planning for another plant which will take about two years tobe in operation.

The local trophy business also recorded a higher sales turnover of RM9.5 million for 15 monthsended 31 March 2012 as compared to RM7.3 million for 12 months ended 31 December 2010. Dueto the constraint of production capacity, the increased in export have adversely affect the supplyfor local trophy. Hence, our local marketing team has made changes to their sales mix with mainconcentration on more value added products and fully assembled trophy. These have resulted ina higher turnover despite a lower quantity of trophy sold.

OEM DIVISIONThe manufacturing of OEM division posted a turnover of RM21.5 million for 15 months ended 31March 2012 as compared to RM16.0 million for 12 months ended 31 December 2010, an increaseof RM0.3 million or 7.5% comparing the average per quarter.

With the signing of new agreement where the customer will absorb the exchange gain or lossarising from the sales transaction and the stable raw material prices during the 15 months periodto 31 March 2012, OEM business posted better result for the current period as compared to previousyear.

Emico Vietnam posted a lower turnover of RM3.3 million for 15 months ended 31 March 2012 ascompared to RM3.5 million for 12 months ended 31 December 2010, a decrease of RM0.2 millionper quarter or 26.7%. The operation in Vietnam posted a net loss of RM1.3 million for 15 monthsended 31 March 2012 as compared to the same amount of RM1.3 million net loss in 2010. Due tothe continued losses which adversely affect the overall Emico Group's results, the Board haddecided to dispose off Emico Vietnam for a cash consideration of RM800,000. The transaction wascompleted on 30 March 2012, therefore, we are expected to achieve a better Group results in 2013.

TRADING - HOUSEHOLD PRODUCTS

Trading of household products posted a higher turnover of RM23.7 million for 15 months ended31 March 2012 and profit before tax of RM0.5 million as compared to RM18.4 million in turnoverand profit before tax of RM0.3 million for the 12 months ended 31 December 2010.

The increase in turnover by RM0.2 million per average quarter or 3.3% for current period ascompared to previous year is mainly attributable to increase in the number of new customers.With the 3 additional customers in United Kingdom as well as Sweden, Emico Asia is able to diversifyits customer risk profile as well as secured better prices for its customer with bigger quantitypurchased.

100%Completed

100%Completed

100%Completed

100%Completed

Completedin 2002

Completedin 2002 & 2004



PROPERTY DEVELOPMENT

The average quarterly turnover from the property development division for current 15 monthsended 31 March 2012 posted a slight decrease of RM0.2 million or 6.3% on an average per quarterbasis as compared with the 12 months ended 31 December 2010. The decline in turnover wasmainly attributed to the slower economy in general and the tighter banking guidelines imposedon housing loans especially the financing for purchase of second house which has been reducedto 70%.

The property development division recorded a loss before tax of RM0.2 million for the 15 monthsended 31 March 2012 as compared with a profit before tax of RM0.3 million for the 12 monthsended 31 December 2010. The loss for current period is attributable to the provision of impairmentloss on certain property development cost.

The Status of remaining development projects in Sungai Petani & Melaka is tabulated below:-

Taman Batik, Sungai Petani Status of completion SalesPhase 1 116 units double-storey terrace house 99.5%

60 units double-storey semi-detachedhouse 99.5%

12 units factory lots 99.5% 26 units double-storey shop lots 75% completed 30.7% 34 units double-storey shop lots 25% completed -Phase 2 185 units double-storey terrace house 94.0% 82 units double-storey semi-detached

house 100.0%Phase 3 46 units double-storey shop lots 25% completed 8.7% 32 units double-storey shop lots 100% completed 56.2% 16 units double-storey shop lots 85% completed 6.2%Bandar Mutiara, Sungai Petani Status of completion SalesPhase 1 249 units single-storey terrace house 100.0%

136 units single-storey semi-detachedhouse 100.0%

Phase 2 109 units single-storey terrace house 100.0%(Villa Mas & Mutiara) 50 units single-storey terrace house 94.0% 92 units single-storey semi-detached

house 100.0% 80 units double-storey semi-detached

house Earthworks only -Phase 3(Jade Ridge) 174 units single-storey terrace house 94.2%Phase 3A(Ruby Mill) 21 units single-storey terrace house 100.0%Phase 3A 61 units double-storey terrace house 100.0%(Ametis Valley) 14 units double-storey terrace house 55% completed 85.7%

56 units double-storey terrace house 0-35% completed 35.7%Taman Seri Pertam, Melaka Status of completion SalesPhase 3 - Emas 68 units single-storey terrace house 100.0%Intan Mutiara 38 units single-storey terrace house 100.0%

42 units 1 1/2 storey terrace house 76.2%



We foresee that the property development division will remain moderate in 2013 in view of thetightening of credit by the banks and imposition of additional borrowing rules by Bank NegaraMalaysia. However, we are still optimistic in selling the remaining completed unsold units and vacantdevelopment land.

CORPORATE DEVELOPMENT

Emico Group will continue to sell its land bank identified for disposal with market value of approximatelyRM36 million to repay its outstanding loan stocks which stand at RM33 million as at 31 March 2012.As at the date of this report, the following disposals are signed and pending completion date:-

(i) Disposal of 80% shares in PKB-Operasi Tembaga Sdn Bhd which owned a piece of land inLangkawi for a cash consideration of RM10.0 million. Pending fulfilment of all conditionsprecedent, the sale and purchase agreement is expected to be completed before end of 2012.

(ii) Disposal of 2 pieces of freehold land meant for building of petrol station in Sungai Petani fora cash consideration of RM2.3 million. The sale is expected to be completed by 30 October 2012.

(iii) Disposal of 455 units of freehold titles of land bank meant for building of single storey terraceand semi detached houses in Sungai Petani for a cash consideration of RM8.6 million. The saleis expected to be completed on or before 30 November 2012.

PROSPECTS

The management will concentrate its resources to strengthen its core business as explained below:-

(1) Manufacturing - consumer products division.

The trophy division will continue with its expansion plan to cater for its growing export business.We are also mindful that export market is very demanding and competitive in term of pricing,quality and delivery. Therefore, efforts are been made to continuously improve on quality anddelivery system. However, it will be very challenging in view of the ever increasing manufacturingcosts such as raw materials and labour cost. We are always on the lookout for innovative ways tolower the cost including sourcing from overseas countries for certain materials and outsourcingcertain production processes. Efforts are also made to automate certain production processes. Thecoming into effect the Minimum Wages Order 2012 on 1st Jan 2013 of RM900 per month willcreate addition pressure for salary increment not only for the lower rank employees but also forall levels of workers throughout the company. Even though we expect the turnover for trophy tocontinue to increase for next year but the profit margin will be affected.

The OEM business especially for Etac, Sweden will continue to grow at a steady pace of 10-15%increment every year. Our joint cooperation with Etac requires both parties to constantly look intoways for cost saving, improve production efficiency and better management of raw material prices.



(2) Trading - household products

With the additional new customers in United Kingdom and Sweden, the trading ofhousehold products is expected to increase this year. The challenge for trading businessis to continue to source for good quality products at a lower competitive price. However,meeting delivery deadline is also very important as certain products are seasonal andany delay can be very costly to all parties.

Recently, HSBC bank has given a RM2.0 million Account Receivable (AR) financingfacilities which provides drawdown on 85% of the invoice value. This facility has enabledthe subsidiary company, Emico Asia to expand its business by providing credit termto existing oversea customers as well as securing potential new customers.

(3) Property development

For Sungai Petani project, the management will continue to market the existingcompleted units while embarking on new phases with limited units. We will continueto increase our marketing effort whilst managing our cash flow during this period.

For the remaining land banks, the management will continue to look for potentialbuyers through the agents and advertisement to dispose of its remaining land bankwith the expected sale proceeds to be used to repay the remaining RSLS loan stocksdue on 31 December 2012.

ACKNOWLEDGEMENT

On behalf of the Board, I wish to thank all bankers, suppliers, customers, business associates and mostimportant of all the management and staff of Emico for the dedication and professionalism thatunderpins everything we do, and for their part in further developing Emico business. We are alsograteful to all our shareholders of the Company and relevant authorities for their continued invaluablesupport and confidence in the Group.

Lim Teik HianExecutive Chairman


FINANCIAL I STATEMENTS

DIRECTORS’ REPORT


The Directors hereby submit their report together with the audited financial statements of the Group andof the Company for the financial period.

PRINCIPAL ACTIVITIES

The Company is principally involved in investment holding.

The principal activities of the subsidiaries and associates are stated in Note 10 and Note 11 to the financialstatements respectively. There have been no significant changes in the nature of the activities of the Groupand of the Company during the financial period.

CHANGE IN REPORTING PERIOD

The financial year end of the Company was changed from 31 December to 31 March for managementplanning purposes.

RESULTSGroup Company

RM RM

Loss for the financial period (1,751,241) (5,903,504)

(Loss)/Profit attributable to:Owners of the parent (1,970,146) (5,903,504)Non-controlling interests 218,905 0

(1,751,241) (5,903,504)

DIVIDEND

No dividend has been paid or declared by the Company since the end of the previous financial year. TheDirectors do not recommend any payment of dividend for the current financial period.

RESERVES AND PROVISIONS

There were no material transfers to or from reserves or provisions during the financial period.

ISSUE OF SHARES AND DEBENTURES

The Company did not issue any new shares or debentures during the financial period.

OPTIONS GRANTED OVER UNISSUED SHARES

No options were granted to any person to take up unissued ordinary shares of the Company during thefinancial period.


WARRANTS

On 1 December 2003, 11,130,000 detachable warrants were granted by the Company to the subscribersof the rights shares. The warrants may be exercised at any time after the issue date but not later than 5.00p.m. on 1 December 2013. Each warrant entitles its registered holder, at any time during the exercise periodof the warrants, to subscribe for one new ordinary share. The exercise price of each warrant is fixed at RM1payable in cash for each new ordinary share of RM1 each in the Company. As at 31 March 2012, none ofthe 11,130,000 warrants were exercised to subscribe for new ordinary shares.

DIRECTORS

The Directors who have held office since the date of the last report are:

Lim Teik HianJimmy Ong Chin KengLim Teck ChyeWong Sew YunNg Chee KongWong Thai Sun

DIRECTORS’ INTERESTS

The Directors holding office at the end of the financial period and their beneficial interests in ordinaryshares and warrants in the Company during the financial period from 1 January 2011 to 31 March2012 as recorded in the Register of Directors’ Shareholdings kept by the Company under Section 134of the Companies Act, 1965 were as follows:

Number of ordinary shares of RM1 eachBalance as at Balance as at

1-1-2011 Bought Sold 31-3-2012Shares in the Company

Direct interests:Lim Teik Hian 52,000 0 0 52,000Wong Sew Yun 895,859 0 0 895,859Lim Teck Chye 1,211,630 0 0 1,211,630

Indirect interests:Lim Teik Hian 18,665,759 1,979,483 0 20,645,242Lim Teck Chye 17,506,129 1,979,483 0 19,485,612

Number of warrants of RM1 eachBalance as at Balance as at

1-1-2011 Bought Sold 31-3-2012Warrants in the Company

Direct interests:Lim Teik Hian 13,000 0 0 13,000Wong Sew Yun 263,488 0 0 263,488Lim Teck Chye 7 0 0 7

DIRECTORS’ REPORT

DIRECTORS’ REPORT


By virtue of their interests in the ordinary shares of the Company, Lim Teik Hian and Lim Teck Chye aredeemed to be interested in the ordinary shares of all the subsidiaries to the extent the Company has aninterest.

None of the other Directors holding office at the end of the financial period held any interests in ordinaryshares in the Company and its related corporations during the financial period.

DIRECTORS’ BENEFITS

Since the end of the previous financial year, none of the Directors have received or become entitledto receive any benefit (other than a benefit included in the aggregate amount of emoluments receivedor due and receivable by the Directors as shown in the financial statements) by reason of a contractmade by the Company or a related corporation with the Director or with a firm of which the Directoris a member, or with a company in which the Director has a substantial financial interest other thanthe following:

(a) remuneration received by certain Directors as directors/executives of the subsidiaries;

(b) warrants granted by the Company to eligible employees including Directors of the Companyto subscribe for shares in the Company; and

(c) any benefit which may be deemed to have arisen by virtue of transactions as disclosed inNote 36 to the financial statements.

There were no arrangements during and at the end of the financial period to which the Company isa party, being arrangements with the object or objects of enabling Directors of the Company toacquire benefits by means of the acquisition of shares in, or debentures of, the Company or any otherbody corporate.

OTHER STATUTORY INFORMATION REGARDING THE GROUP AND THE COMPANY

(I) AS AT THE END OF THE FINANCIAL PERIOD

(a) Before the statements of comprehensive income and statements of financial position of theGroup and of the Company were made out, the Directors took reasonable steps:

(i) to ascertain that proper action had been taken in relation to the writing off of bad debtsand the making of provision for doubtful debts and have satisfied themselves that thereare no known bad debts and that adequate provision have been made for doubtfuldebts; and

(ii) to ensure that any current assets other than debts, which were unlikely to realise theirbook values in the ordinary course of business had been written down to their estimatedrealisable values.

(b) In the opinion of the Directors, except for the gain on disposal of investment in a subsidiaryand impairment losses as disclosed in Note 30 and Note 33 to the financial statementsrespectively, the results of the operations of the Group and of the Company during thefinancial period have not been substantially affected by any item, transaction or event of amaterial and unusual nature.

DIRECTORS’ REPORT


(II) FROM THE END OF THE FINANCIAL PERIOD TO THE DATE OF THIS REPORT

(c) The Directors are not aware of any circumstances:

(i) which would necessitate the writing off of bad debts or render the amount of theprovision for doubtful debts inadequate to any material extent; and

(ii) which would render the values attributed to current assets in the financial statementsof the Group and of the Company misleading; and

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

(d) In the opinion of the Directors:

(i) there has not arisen any item, transaction or event of a material and unusual naturewhich is likely to affect substantially the results of the operations of the Group and ofthe Company for the financial year in which this report is made; and

(ii) no contingent or other liability has become enforceable or is likely to become enforceablewithin the period of twelve (12) months after the end of the financial period which willor may affect the ability of the Group or of the Company to meet their obligations asand when they fall due.

(III) AS AT THE DATE OF THIS REPORT

(e) There are no charges on the assets of the Group and of the Company which have arisen sincethe end of the financial year to secure the liabilities of any other person.

(f) There are no contingent liabilities of the Group and of the Company which have arisen sincethe end of the financial period.

(g) The Directors are not aware of any circumstances not otherwise dealt with in the report orfinancial statements which would render any amount stated in the financial statements ofthe Group and of the Company misleading.

SIGNIFICANT EVENTS DURING THE FINANCIAL PERIOD

Details of significant events during the financial period are disclosed in Note 41 to the financialstatements.

AUDITORS

The auditors, BDO, have expressed their willingness to continue in office.

Signed on behalf of the Board in accordance with a resolution of the Directors.

Lim Teik Hian Jimmy Ong Chin KengDirector Director

Dated: 20 July 2012

STATUTORY DECLARATION

STATEMENT BY DIRECTORS


In the opinion of the Directors, the financial statements set out on pages 29 to 109 have been drawn upin accordance with applicable approved Financial Reporting Standards and the provisions of the CompaniesAct, 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of theCompany as at 31 March 2012 and of their financial performance and cash flows of the Group and of theCompany for the financial period from 1 January 2011 to 31 March 2012.

On behalf of the Board,

Lim Teik Hian Jimmy Ong Chin KengDirector Director Dated: 20 July 2012

I, Jimmy Ong Chin Keng, being the Director primarily responsible for the financial management of EmicoHoldings Berhad, do solemnly and sincerely declare that the financial statements set out on pages 29 to109 are, to the best of my knowledge and belief, correct and I make this solemn declaration conscientiouslybelieving the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960.

Before me,

Commissioner for Oaths

Quah Keat Jin, PJMPesuruhjaya Sumpah MalayisaNo. 53-3-05, Jalan Sultan Ahmad ShahMBF Tower,10050 Pulau Pinang

Subscribed and solemnly declared bythe abovenamed at Georgetown inthe State of Penang this 20 July 2012 Jimmy Ong Chin Keng

INDEPENDENT AUDITORS’ REPORT


Report on the Financial Statements

We have audited the financial statements of Emico Holdings Berhad, which comprise the statementsof financial position as at 31 March 2012 of the Group and of the Company, and the statements ofcomprehensive income, statements of changes in equity and statements of cash flows of the Groupand of the Company for the financial period from 1 January 2011 to 31 March 2012, and a summaryof significant accounting policies and other explanatory information, as set out on pages 29 to 109.

The financial statements of the Group and of the Company for the financial year ended 31 December2010 were audited by another firm of chartered accountants whose report dated 15 April 2011expressed an unqualified opinion on those statements.

Directors' Responsibility for the Financial Statements

The Directors of the Company are responsible for the preparation of financial statements that give atrue and fair view in accordance with Financial Reporting Standards and the Companies Act, 1965 inMalaysia, and for such internal control as the Directors determine are necessary to enable thepreparation of financial statements that are free from material misstatement, whether due to fraudor error.

Auditors' Responsibility

Our responsibility is to express an opinion on these financial statements based on our audit. Weconducted our audit in accordance with approved standards on auditing in Malaysia. Those standardsrequire that we comply with ethical requirements and plan and perform the audit to obtain reasonableassurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosuresin the financial statements. The procedures selected depend on our judgement, including theassessment of risks of material misstatement of the financial statements, whether due to fraud orerror. In making those risk assessments, we consider internal control relevant to the entity’s preparationof financial statements that give a true and fair view in order to design audit procedures that areappropriate in the circumstances, but not for the purpose of expressing an opinion on the effectivenessof the entity's internal control. An audit also includes evaluating the appropriateness of accountingpolicies used and the reasonableness of accounting estimates made by the Directors, as well asevaluating the overall presentation of the financial statements.

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

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with applicableapproved Financial Reporting Standards and the provisions of the Companies Act, 1965 in Malaysiaso as to give a true and fair view of the financial position of the Group and of the Company as at 31March 2012 and of their financial performance and cash flows of the Group and of the Company forthe financial period from 1 January 2011 to 31 March 2012.

TO THE MEMBERS OF EMICO HOLDINGS BERHAD(Incorporated in Malaysia)


Report on Other Legal and Regulatory Requirements

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

a) In our opinion, the accounting and other records and the registers required by the Act to be keptby the Company and its subsidiaries of which we have acted as auditors have been properly keptin accordance with the provisions of the Act.

b) We have considered the financial statements and the auditors’ report of all the subsidiaries of whichwe have not acted as auditors, which are indicated in Note 10 to the financial statements.

c) We are satisfied that the financial statements of the subsidiaries that have been consolidated withthe Company’s financial statements are in form and content appropriate and proper for the purposesof the preparation of the financial statements of the Group and we have received satisfactoryinformation and explanations required by us for those purposes.

d) The audit reports on the financial statements of the subsidiaries did not contain any qualificationor any adverse comment made under Section 174(3) of the Act.

Other Reporting Responsibilities

The supplementary information set out in Note 43 to the financial statements is disclosed to meetthe requirement of Bursa Malaysia Securities Berhad and is not part of the financial statements. TheDirectors are responsible for the preparation of the supplementary information in accordance withGuidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in theContext of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issuedby the Malaysian Institute of Accountants (”MIA Guidance”) and the directive of Bursa MalaysiaSecurities Berhad. In our opinion, the supplementary information is prepared, in all material respects,in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.

Other Matters

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

BDO Koay Theam HockAF: 0206 2141/04/13 (J)Chartered Accountants Chartered Accountant

Penang

Dated : 20 July 2012

INDEPENDENT AUDITORS’ REPORTTO THE MEMBERS OF EMICO HOLDINGS BERHAD(Incorporated in Malaysia)


STATEMENTS OF FINANCIAL POSITION

Group Company31.3.2012 31.12.2010 31.3.2012 31.12.2010

Note RM RM RM RMASSETS

Non-Current AssetsProperty, plant and equipment 7 20,622,984 12,118,245 0 0Investment properties 8 210,167 4,405,853 0 2,800,000Goodwill 9 551,552 551,552 0 0Investment in subsidiaries 10 0 0 25,438,248 28,116,497Investment in associates 11 0 1,684,550 0 0Property development projects 13 2,742,717 28,766,166 0 0Deferred tax assets 14 127,539 215,600 0 0

24,254,959 47,741,966 25,438,248 30,916,497

Current Assets

Property development projects 13 12,434,654 16,764,049 0 0Inventories 15 12,397,212 17,261,299 0 0Trade and other receivables 16 14,323,112 12,547,163 39,440,169 41,474,354Current tax assets 12,660 55,579 0 0Cash and cash equivalents 17 4,568,574 5,738,937 682,757 32,544

43,736,212 52,367,027 40,122,926 41,506,898Assets of disposal group classified as held for sale 18 31,680,626 0 2,313,333 0

TOTAL ASSETS 99,671,797 100,108,993 67,874,507 72,423,395

AS AT 31 MARCH 2012

The accompanying notes form an integral part of the financial statements.

STATEMENTS OF FINANCIAL POSITION


Group Company31.3.2012 31.12.2010 31.3.2012 31.12.2010

Note RM RM RM RM

EQUITY AND LIABILITIES

Equity attributable to owners ofthe parent

Share capital 19 95,926,521 95,926,521 95,926,521 95,926,521Reserves 20 16,010,908 6,561,646 7,736,782 7,736,782Accumulated losses (77,637,504) (75,667,358) (82,201,208) (76,297,704)

34,299,925 26,820,809 21,462,095 27,365,599

Non-controlling interests 8,524,556 8,305,651 0 0

TOTAL EQUITY 42,824,481 35,126,460 21,462,095 27,365,599

LIABILITIES

Non-Current LiabilitiesBorrowings 22 272,254 176,800 0 0Deferred tax liabilities 14 3,207,087 455,881 0 0

3,479,341 632,681 0 0Current Liabilities

Trade and other payables 27 17,922,813 28,080,706 13,139,712 11,785,096Redeemable secured loan stocks 21 33,146,600 33,146,600 33,146,600 33,146,600Borrowings 22 1,113,956 2,007,085 0 0Current tax liabilities 884,872 1,115,461 126,100 126,100

53,068,241 64,349,852 46,412,412 45,057,796

Liabilities of disposal group classified as held for sale 18 299,734 0 0 0

TOTAL LIABILITIES 56,847,316 64,982,533 46,412,412 45,057,796

TOTAL EQUITY AND LIABILITIES 99,671,797 100,108,993 67,874,507 72,423,395


AS AT 31 MARCH 2012

STATEMENTS OF COMPREHENSIVE INCOME

ANNUAL REPORT 2012 31The accompanying notes form an integral part of the financial statements.

FOR THE FINANCIAL PERIOD FROM 1 JANUARY 2011 TO 31 MARCH 2012

Group Company31.3.2012 31.12.2010 31.3.2012 31.12.2010

Note RM RM RM RM

Revenue 29 87,502,666 64,729,801 300,000 240,000Other income 30 2,795,726 3,870,091 414,899 17,000,276Share of profit of associates 422,384 180,123 0 0Property development

expenditure recognised (11,241,739) (9,358,779) 0 0Changes in inventories of finished

goods and work-in-progress (262,156) 1,115,863 0 0Purchase of finished goods (37,585,149) (26,318,990) 0 0Raw materials and consumables

used (11,094,283) (11,460,773) 0 0Employee benefits expense 31 (9,471,097) (6,860,555) (451,668) (261,788)Depreciation and amortisation (2,648,682) (2,176,004) 0 0Finance costs 32 (3,085,942) (1,868,387) (2,451,334) (1,598,194)Other expenses (16,866,127) (10,524,496) (3,715,401) (525,606)

(Loss)/Profit before tax 33 (1,534,399) 1,327,894 (5,903,504) 14,854,688

Tax expense 34 (216,842) (123,063) 0 0

(Loss)/Profit after taxfor the financial period/year (1,751,241) 1,204,831 (5,903,504) 14,854,688

Other comprehensive income/(loss):

Revaluation reserve on leaseholdland and building, net of tax 8,274,126 0 0 0

Foreign currency translation differencesfor foreign operations 1,175,136 (441,393) 0 0

Other comprehensive income/(loss),net of tax 9,449,262 (441,393) 0 0

Total comprehensive income/(loss) 7,698,021 763,438 (5,903,504) 14,854,688

(Loss)/Profit attributable to:Owners of the parent (1,970,146) 1,053,856 (5,903,504) 14,854,688Non-controlling interests 218,905 150,975 0 0

(1,751,241) 1,204,831 (5,903,504) 14,854,688

Total comprehensive income/(loss)attributable to:

Owners of the parent 7,479,116 612,463 (5,903,504) 14,854,688Non-controlling interests 218,905 150,975 0 0

7,698,021 763,438 (5,903,504) 14,854,688(Loss)/Earnings per ordinary share

attributable to equity holdersof the Company (sen):

Basic and diluted 35 (2.05) 1.10

STATEMENTS OF CHANGES IN EQUITY

ANNUAL REPORT 201232The accompanying notes form an integral part of the financial statements.


Total attributable Non

Share Share Exchange Accumulated to owners of controlling Totalcapital premium reserve losses the parent interests equity

RM RM RM RM RM RM RM

Group

Balance at 1 January 2010 95,926,521 7,736,782 (733,743) (76,721,214) 26,208,346 8,154,676 34,363,022

Profit for the financial year 0 0 0 1,053,856 1,053,856 150,975 1,204,831

Foreign currency translation 0 0 (441,393) 0 (441,393) 0 (441,393)

Total comprehensive income 0 0 (441,393) 1,053,856 612,463 150,975 763,438

Balance at 31 December 2010 95,926,521 7,736,782 (1,175,136) (75,667,358) 26,820,809 8,305,651 35,126,460





Totalattributable Non-

Share Share Revaluation Exchange Accumulated to owners of controlling Total capital premium reserve reserve losses the parent interests equity

RM RM RM RM RM RM RM RM Group

Balance at 1 January 2011 95,926,521 7,736,782 0 (1,175,136) (75,667,358) 26,820,809 8,305,651 35,126,460

Loss for the financial period 0 0 0 0 (1,970,146) (1,970,146) 218,905 (1,751,241)Revaluation reserve on

leasehold land andbuilding 0 0 8,274,126 0 0 8,274,126 0 8,274,126

Foreign currency translation 0 0 0 1,175,136 0 1,175,136 0 1,175,136Total comprehensive

income 0 0 8,274,126 1,175,136 (1,970,146) 7,479,116 218,905 7,698,021

Balance at 31 March 2012 95,926,521 7,736,782 8,274,126 0 (77,637,504) 34,299,925 8,524,556 42,824,481




Share Share Accumulated Total capital premium losses equity RM RM RM RMCompany

Balance at 1 January 2010 95,926,521 7,736,782 (91,152,392) 12,510,911

Profit for the financial year 0 0 14,854,688 14,854,688

Total comprehensive income 0 0 14,854,688 14,854,688

Balance at 31 December 2010 95,926,521 7,736,782 (76,297,704) 27,365,599

Balance at 1 January 2011 95,926,521 7,736,782 (76,297,704) 27,365,599

Loss for the financial period 0 0 (5,903,504) (5,903,504)

Total comprehensive loss 0 0 (5,903,504) (5,903,504)

Balance at 31 March 2012 95,926,521 7,736,782 (82,201,208) 21,462,095


STATEMENTS OF CASH FLOWS



Group Company1.1.2011 1.1.2010 1.1.2011 1.1.2010

to to to to 31.3.2012 31.12.2010 31.3.2012 31.12.2010

Note RM RM RM RMCASH FLOWS FROM OPERATING ACTIVITIES

(Loss)/Profit before tax (1,534,399) 1,327,894 (5,903,504) 14,854,688

Adjustments for:Finance costs 32 3,085,942 1,868,387 2,451,334 1,598,194Depreciation of property, plant

and equipment 7 2,640,557 2,147,852 0 0Amortisation of investment

properties 8 8,125 28,152 0 0Unrealised loss on foreign

exchange 57,124 174,076 0 0Unrealised gain on foreign

exchange (234,086) 0 0 0Share of profit of associates (422,384) (180,123) 0 0Reversal of allowance for slow

moving inventories 0 (5,572) 0 0Property, plant and equipment

written off 7 6,425 3,741 0 0Impairment losses on:

- Trade and other receivables 16 75,758 409,094 0 0- Investment properties 486,667 0 486,667 0- Investment in subsidiaries 0 0 1,600,485 0- Land held for property

development 13 742,555 0 0 0Developed properties written

down 1,001,526 0 0 0Reversal of impairment loss on

trade and other receivables 16 (546,998) (1,140) (413,970) (17,000,000)(Gain)/Loss on disposal of

investment in a subsidiary 10 (1,006,872) 0 1,227,764 0Net (gain)/loss on disposal of

property, plant and equipment (269,993) 53,949 0 0Gain on disposal of investment

property and prepaidleasehold land 0 (2,816,173) 0 0

Loss on disposal of investment inan associate 306,934 0 0 0

Interest income (120,064) (218,938) (129) (276)

Operating profit/(loss) beforechanges in working capital 4,276,817 2,791,199 (551,353) (547,394)



STATEMENTS OF CASH FLOWSFOR THE FINANCIAL PERIOD FROM 1 JANUARY 2011 TO 31 MARCH 2012

Group Company1.1.2011 1.1.2010 1.1.2011 1.1.2010

to to to to 31.3.2012 31.12.2010 31.3.2012 31.12.2010

Note RM RM RM RMCASH FLOWS FROM OPERATING ACTIVITIES

Increase in propertydevelopment projects 1,564,755 4,942,273 0 0

Decrease/(Increase) in inventories 3,426,680 (4,006,694) 0 0(Increase)/Decrease in trade and

other receivables (2,473,625) 1,910,741 2,448,155 16,854,200(Decrease)/Increase in trade

and other payables (6,633,073) (433,862) 1,404,616 (128,881)

161,554 5,203,657 3,301,418 16,177,925Interest received 120,064 218,938 129 276Interest paid (17,770) 0 0 0Tax refunded 202,348 10,320 0 0Tax paid (524,433) (107,805) 0 0

Net cash (used in)/fromoperating activities (58,237) 5,325,110 3,301,547 16,178,201

CASH FLOWS FROM INVESTINGACTIVITIES

Additional investment in asubsidiary 0 0 (1,000,000) (12,000,000)

Proceeds from disposal ofproperty, plant andequipment 1,814,133 74,239 0 0

Proceeds from disposal ofinvestment property 0 3,900,000 0 0

Proceeds from disposal ofinvestment in a subsidiary 0 0 800,000 0

Proceeds from disposal ofan associate 1,800,000 0 0 0

Purchase of property, plant andequipment 7(b) (2,336,332) (2,523,250) 0 0

Net cash inflow from disposalof subsidiaries 10 725,402 0

Net cash from/(used in)investing activities 2,003,203 1,450,989 (200,000) (12,000,000)


STATEMENTS OF CASH FLOWS



Group Company1.1.2011 1.1.2010 1.1.2011 1.1.2010

to to to to 31.3.2012 31.12.2010 31.3.2012 31.12.2010

Note RM RM RM RMCASH FLOWS FROM FINANCING ACTIVITIES

Changes in fixed deposits with alicensed bank 102,075 (51,034) 0 0

Redemption of redeemablesecured loan stocks 0 (2,565,000) 0 (2,565,000)

Interest paid (3,084,198) (1,868,387) (2,451,334) (1,598,194)Repayment of term loans 0 (255,015) 0 0Decrease in bank borrowings (429,090) (165,119) 0 0Repayment of hire purchase

payables (35,162) (153,706) 0 0Net cash used in financing

activities (3,446,375) (5,058,261) (2,451,334) (4,163,194)

Net (decrease)/increase in cashand cash equivalents (1,501,409) 1,717,838 650,213 15,007

Effects of exchange ratechanges on cash and cashequivalents 453,610 (80,124) 0 0

Cash and cash equivalentsat beginning of financialperiod/year 5,150,966 3,513,252 32,544 17,537

Cash and cash equivalents at

end of financial period/year 17(e) 4,103,167 5,150,966 682,757 32,544


NOTES TO THE FINANCIAL STATEMENTS


1 JANUARY 2011 TO 31 MARCH 2012

1. CORPORATE INFORMATIONThe Company is a public limited liability company, incorporated and domiciled in Malaysia andis listed on the Main Market of Bursa Malaysia Securities Board.

The registered office of the Company is located at 51-21-A, Menara BHL Bank, Jalan Sultan AhmadShah, 10050 Penang.

The principal place of business of the Company is located at 18, Lebuhraya Kampung Jawa, 11900Bayan Lepas, Penang.

The financial statements are presented in Ringgit Malaysia ('RM'), which is also the Company'sfunctional currency.

The financial year end of the Company was changed from 31 December to 31 March formanagement planning purposes. Accordingly, comparative amounts for the statements ofcomprehensive income, statements of changes in equity, statements of cash flows and relatednotes are not comparable.

The financial statements were authorised for issue by the Board of Directors in accordance witha resolution of the Directors on 20 July 2012.

2. PRINCIPAL ACTIVITIES

The Company is a principally involved in investment holding.

The principal activities of the subsidiaries and associates are stated in Note 10 and Note 11 to thefinancial statements respectively. There have been no significant changes in the nature of theactivities of the Group and of the Company during the financial period.

3. BASIS OF PREPARATION

The financial statements of the Group and of the Company as set out on pages 29 to 109 havebeen prepared in accordance with applicable approved Financial Reporting Standards (‘FRSs’)and the provisions of the Companies Act, 1965 in Malaysia. However, Note 43 to the financialstatements has been prepared in accordance with Guidance on Special Matter No. 1, Determinationof Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa MalaysiaSecurities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants (‘MIAGuidance’) and the directive of Bursa Malaysia Securities Berhad.

4. SIGNIFICANT ACCOUNTING POLICIES

4.1 Basis of accounting

The financial statements of the Group and of the Company have been prepared under thehistorical cost convention except as otherwise stated in the financial statements.

The preparation of financial statements requires the Directors to make estimates andassumptions that affect the reported amounts of assets, liabilities, revenue and expensesand disclosure of contingent assets and contingent liabilities. In addition, the Directors arealso required to exercise their judgment in the process of applying the accounting policies. The areas involving such judgments, estimates and assumptions are disclosed in Note 6 tothe financial statements. Although these estimates and assumptions are based on theDirectors’ best knowledge of events and actions, actual results could differ from thoseestimates.


4. SIGNIFICANT ACCOUNTING POLICIES (cont’d)

4.2 Basis of consolidation

The consolidated financial statements incorporate the financial statements of the Companyand all its subsidiaries. Subsidiaries are entities over which the Company has the power togovern the financial operating policies, generally accompanied by a shareholding giving riseto the majority of the voting rights, as to obtain benefits from their activities.

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

Intragroup balances, transactions, income and expenses are eliminated on consolidation.Unrealised gains arising from transactions with associates and joint ventures are eliminatedagainst the investment to the extent of the Group's interest in the invested. Established lossesare eliminated in the same way as unrealized gains, but only to the extent that there is noimpairment.

The financial statements of the subsidiaries are prepared for the same reporting period asthat of the Company, using consistent accounting policies. Where necessary, accountingpolicies of subsidiaries are changed to ensure consistency with the policies adopted by theother entities in the Group.

Non-controlling interests represents the equity in subsidiaries that are not attributable,directly or indirectly, to owners of the Company, and is presented separately in the consolidatedstatement of comprehensive income and within equity in the consolidated statement offinancial position, separately from equity attributable to owners of the Company. Profit orloss and each component of other comprehensive income are attributed to the owners ofthe parent and to the non-controlling interests. Total comprehensive income is attributedto non-controlling interests even if this results in the non-controlling interests having a deficitbalance.

Components of non-controlling interests in the acquiree that are present ownership interestsand entitle their holders to a proportionate share of the entity’s net assets in the event ofliquidation may be initially measured at either fair value or at the present ownershipinstruments’ proportionate share in the recognised amounts of the acquiree’s identifiablenet assets. All other components of non-controlling interests shall be measured at theiracquisition-date fair values, unless another measurement basis is required by FRSs. The choiceof measurement basis is made on an combination-by-combination basis. Subsequent toinitial recognition, the carrying amount of non-controlling interests is the amount of thoseinterests at initial recognition plus the non-controlling interests’ hare of subsequent changesin equity.

The Group has applied the revised FRS 3 Business Combinations in accounting for businesscombinations from 1 January 2011 onwards. The change in accounting policy has beenapplied prospectively in accordance with the transitional provisions provided by the Standard.

Changes in the Company owners’ ownership interest in a subsidiary that do not result in aloss of control are accounted for as equity transactions. In such circumstances, the carryingamounts of the controlling and non-controlling interests are adjusted to reflect the changesin their relative interests in the subsidiary. Any difference between the amount by which thenon-controlling interest is adjusted and the fair value of consideration paid or received isrecognised directly in equity and attributed to owners of the parent.

NOTES TO THE FINANCIAL STATEMENTS1 JANUARY 2011 TO 31 MARCH 2012 (cont’d)




4.2 Basis of consolidation (cont’d)

When the Group loses control of a subsidiary, the profit or loss on disposal is calculated asthe difference between:

(i) the aggregate of the fair value of the consideration received and the fair value of anyretained interest; and

(ii) the previous carrying amount of the assets (including goodwill), and liabilities of thesubsidiary and any non-controlling interests.

Amounts previously recognised in other comprehensive income in relation to thesubsidiary are accounted for (i.e. reclassified to profit or loss or transferred directly toretained earnings) in the same manner as would be required if the relevant assets orliabilities were disposed of. The fair value of any investments retained in the formersubsidiary at the date when control is lost is regarded as the fair value on initial recognitionfor subsequent accounting under FRS 139 Financial Instruments: Recognition andMeasurement or, where applicable, the cost on initial recognition of an investment inassociate or jointly controlled entity.

4.3 Business combinations

Business combinations from 1 January 2011 onwards

Business combinations are accounted for by applying the acquisition method of accounting.

Identifiable assets acquired, liabilities and contingent liabilities assumed in a businesscombination are measured at their fair value at the acquisition date, except that:

(a) deferred tax assets or liabilities and liabilities or assets related to employee benefitarrangements are recognised and measured in accordance with FRS 112 Income Taxesand FRS 119 Employee Benefits respectively;

(b) liabilities or equity instruments related to share-based payment transactions of theacquiree or the replacement by the Group of an acquiree’s share-based paymenttransactions are measured in accordance with FRS 2 Share-based Payment at the acquisitiondate; and

(c) assets (or disposal groups) that are classified as held for sale in accordance with FRS 5Non-current Assets Held for Sale and Discontinued Operations are measured in accordancewith that Standard.

Acquisition-related costs are recognised as expenses in the periods in which the costs areincurred and the service are received.

Any contingent consideration payable is recognised at fair value at the acquisition date.Measurement period adjustments to contingent consideration are dealt with as follows:

(a) If the contingent consideration is classified as equity, it is not remeasured and settlementis accounted for within equity.

(b) Subsequent changes to contingent consideration classified as an asset or liability thatis a financial instrument within the scope of FRS 139 are recognised either in profit orloss or in other comprehensive income in accordance with FRS 139. All other subsequentchanges are recognised in profit or loss.

1 JANUARY 2011 TO 31 MARCH 2012 (cont’d)




4.3 Business combinations (cont’d)

In a business combination achieved in stages, previously held equity interests in the acquireeare re-measured to fair value at the acquisition date and any corresponding gain or loss isrecognised in profit or loss.

The Group elects for each individual business combination, whether non-controlling interestin the acquiree (if any) is recognised on the acquisition date at fair value, or at the non-controlling interest’s proportionate share of the acquiree net identifiable assets.

Any excess of the sum of the fair value of the consideration transferred in the businesscombination, the amount of non-controlling interest in the acquiree (if any), and the fairvalue of the Group’s previously held equity interest in the acquiree (if any), over the net fairvalue of the acquiree’s identifiable assets and liabilities is recorded as goodwill in the statementof financial position. The accounting policy for goodwill is set out in Note 4.8. In instanceswhere the latter amount exceeds the former, the excess is recognised as a gain on bargainpurchase in profit or loss on the acquisition date.

Business combinations before 1 January 2011

Under the purchase method of accounting, the cost of business combination is measuredat the aggregate of fair values at the date of exchange, of assets given, liabilities incurred orassumed, and equity instruments issued plus any costs directly attributable to the businesscombination.

At the acquisition date, the cost of business combination is allocated to identifiable assetsacquired, liabilities assumed and contingent liabilities in the business combination whichare measured initially at their fair values at the acquisition date. The excess of the cost ofbusiness combination over the Group’s interest in the net fair value of the identifiable assets,liabilities and contingent liabilities is recognised as goodwill (see Note 4.8) to the financialstatements on goodwill. If the cost of business combination is less than the interest in thenet fair value of the identifiable assets, liabilities and contingent liabilities, the Group will:

(a) reassess the identification and measurement of the acquiree’s identifiable assets, liabilitiesand contingent liabilities and the measurement of the cost of the business combination; and

(b) recognise immediately in profit or loss any excess remaining after that reassessment.

When a business combination includes more than one exchange transaction, any adjustmentto the fair values of the subsidiary’s identifiable assets, liabilities and contingent liabilitiesrelating to previously held interests of the Group is accounted for as a revaluation.

4.4 Property, plant and equipment and depreciation

All items of property, plant and equipment are initially measured at cost. Cost includesexpenditure that is directly attributable to the acquisition of the asset.

Subsequent costs are included in the asset’s carrying amount or recognised as a separateasset, as appropriate, only when the cost is incurred and it is probable that the future economicbenefits associated with the asset will flow to the Group and the cost of the asset can bemeasured reliably. The carrying amount of parts that are replaced is derecognised. The costsof the day-to-day servicing of property, plant and equipment are recognised in profit or lossas incurred. Cost also comprises the initial estimate of dismantling and removing the assetand restoring the site on which it is located for which the Group is obligated to incur whenthe asset is acquired, if applicable.




4.4 Property, plant and equipment and depreciation (cont’d)

Each part of an item of property, plant and equipment with a cost that is significant in relationto the total cost of the asset and which has different useful life, is depreciated separately.

After initial recognition, property, plant and equipment except for long term leasehold andbuildings are stated at cost less any accumulated depreciation and any accumulatedimpairment losses. The leasehold land and buildings are revalued with sufficient regularityto ensure that the carrying amount does not differ materially from that which would bedetermined using fair value at the end of the reporting period. The surplus arising from suchrevaluations is credited to shareholders’ equity as a revaluation reserve, net of deferred tax,if any, and any subsequent deficit is offset against such surplus to the extent of a previousincrease for the same property. In all other cases, the deficit will be charged to profit or loss. For a revaluation increase subsequent to a revaluation deficit of the same asset, the surplusis recognised as income to the extent that it reverses the deficit previously recognised as anexpense with the balance of increase credited to revaluation reserve.

Depreciation is calculated to write off the cost of the assets to their residual values on astraight line basis over their estimated useful lives. The principal annual depreciation periodand rates are as follows:

Buildings 2% - 10%Long term leasehold land 55 yearsPlant and machinery 10% - 20%Moulds 10% & 20%Motor vehicles 10% - 33%Office equipment, furniture and fittings 8% - 20%Tools, implements and equipment 10% & 20%Electrical installation and renovation 10% & 20%

At the end of each reporting period, the carrying amount of an item of property, plant andequipment is assessed for impairment when events or changes in circumstances indicatethat its carrying amount may not be recoverable. A write down is made if the carrying amountexceeds the recoverable amount (see Note 4.11 to the financial statements on impairmentof non-financial assets).

The residual values, useful lives and depreciation method are reviewed at the end of eachreporting period to ensure that the amount, method and period of depreciation are consistentwith previous estimates and the expected pattern of consumption of the future economicbenefits embodied in the items of property, plant and equipment. If expectations differ fromprevious estimates, the changes are accounted for as a change in an accounting estimate.

The carrying amount of an item of property, plant and equipment is derecognised on disposalor when no future economic benefits are expected from its use or disposal. The differencebetween the net disposal proceeds, if any, and the carrying amount is included in profit orloss and the revaluation surplus related to those assets, if any, is transferred directly to retainedprofits.

4.5 Investment properties

Investment properties are properties which are owned to earn rental income or for capitalappreciation or for both, but not for sale in the ordinary course of business, use in theproduction or supply of goods or services or for administrative purposes. These include landheld for a currently undetermined future use, if any.



4.5 Investment properties (cont’d)

Investment properties are stated at cost less any accumulated depreciation and anyaccumulated impairment losses, consistent with the accounting policy for property, plantand equipment as stated in accounting policy Note 4.4.

Depreciation is charged to profit or loss on a straight-line basis over the estimated usefullives of 50 years for buildings. Freehold land is not depreciated.

Transfers between investment property, property, plant and equipment and inventories donot change the carrying amount and the cost of the property transferred

An investment property is derecognised on its disposal, or when it is permanently withdrawnfrom use and no future economic benefits are expected from its disposal. The differencebetween the net disposal proceeds and the carrying amount is recognised in profit or lossin the period in which the item is derecognised.

4.6 Hire purchase

(a) Hire purchase

Assets acquired under hire purchase which transfer substantially all the risks and rewardsof ownership to the Group are recognised initially at amounts equal to the fair value ofthe hire purchased assets or, if lower, the present value of minimum hire purchasepayments, each determined at the inception of the hire purchase. The discount rateused in calculating the present value of the minimum hire purchase payments is theinterest rate implicit in the hire purchase, if this is practicable to determine; if not, theGroup’s incremental borrowing rate is used. Any initial direct costs incurred by the Groupare added to the amount recognised as an asset. The assets are capitalised as property,plant and equipment and the corresponding obligations are treated as liabilities. Theproperty, plant and equipment capitalised are depreciated on the same basis as ownedassets.

The minimum hire purchase payments are apportioned between the finance chargesand the reduction of the outstanding liability. The finance charges are recognised inprofit or loss over the period of the hire purchase term so as to produce a constantperiodic rate of interest on the remaining hire purchase liabilities.

(b) Operating leases

A lease is classified as an operating lease if it does not transfer substantially all the risksand rewards incidental to ownership.

Lease payments under operating leases are recognised as an expense on a straight-linebasis over the lease term.

4.7 Investments

(a) Subsidiaries

A subsidiary is an entity in which the Group and the Company have power to controlthe financial and operating policies so as to obtain benefits from its activities. Theexistence and effect of potential voting rights that are currently exercisable or convertibleare considered when assessing whether the Group has such power over another entity.




4.7 Investments (cont’d)

An investment in subsidiary, which is eliminated on consolidation, is stated in theCompany’s separate financial statements at cost. Investments accounted for at cost shallbe accounted for in accordance with FRS 5 Non-current Assets Held for Sale andDiscontinued Operations when they are classified as held for sale (or included in adisposal group that is classified as held for sale) in accordance with FRS 5.

When control of a subsidiary is lost as a result of a transaction, event or other circumstance,the Group would derecognise all assets, liabilities and non-controlling interests at theircarrying amount and to recognise the fair value of the consideration received. Anyretained interest in the former subsidiary is recognised at its fair value at the date controlis lost. The resulting difference is recognised as a gain or loss in profit or loss.

(b) Associates

An associate is an entity over which the Group and the Company have significantinfluence and that is neither a subsidiary nor an interest in a joint venture. Significantinfluence is the power to participate in the financial and operating policy decisions ofthe investee but is not control or joint control over those policies.

In the Company’s separate financial statements, an investment in associate is stated atcost less impairment losses.

An investment in associate is accounted for in the consolidated financial statementsusing the equity method of accounting. The investment in associate in the consolidatedstatement of financial position is initially recognised at cost and adjusted thereafter forthe post acquisition change in the Group’s share of net assets of the investments.

The interest in the associate is the carrying amount of the investment in the associateunder the equity method together with any long term interest that, in substance, formpart of the Group’s net investment in the associate.

The Group’s share of the profit or loss of the associate during the financial year is includedin the consolidated financial statements, after adjustments to align the accountingpolicies with those of the Group, from the date that significant influence commencesuntil the date that significant influence ceases. Distributions received from the associatereduce the carrying amount of the investment. Adjustments to the carrying amountmay also be necessary for changes in the Group’s proportionate interest in the associatearising from changes in the associate’s equity that have not been recognised in theassociate’s profit or loss. Such changes include those arising from the revaluation ofproperty, plant and equipment and from foreign exchange translation differences. TheGroup’s share of those changes is recognised directly in equity of the Group.

Unrealised gains and losses on transactions between the Group and the associate areeliminated to the extent of the Group’s interest in the associate.





4.7 Investments (cont’d)

When the Group’s share of losses in the associate equals to or exceeds its interest in theassociate, the carrying amount of that interest is reduced to nil and the Group does notrecognise further losses unless it has incurred legal or constructive obligations or madepayments on its behalf.

The most recent available financial statements of the associate are used by the Groupin applying the equity method. When the end of the reporting periods of the financialstatements are not coterminous, the share of results is arrived at using the latest auditedfinancial statements for which the difference at the end of the reporting periods is nomore than three (3) months. Adjustments are made for the effects of any significanttransactions or events that occur between the intervening periods.

Upon disposal of an investment in associate, the difference between the net disposalproceeds and its carrying amount is included in profit or loss.

4.8 Goodwill

Goodwill recognised in a business combination is an asset at the acquisition date and isinitially measured at cost being the excess of the sum of the consideration transferred, theamount of any non-controlling interest in the acquiree and the fair value of the acquirer’spreviously held equity interest (if any) in the entity over net of the acquisition-date amountsof the identifiable assets acquired and the liabilities assumed. If, after reassessment, theGroup’s interest in the fair value of the acquiree’s identifiable net assets exceeds the sum ofthe consideration transferred, the amount of any non-controlling interest in the acquireeand the fair value of the acquirer’s previously held equity interest in the acquiree (if any),the excess is recognised immediately in profit or loss as a bargain purchase gain.

After initial recognition, goodwill is measured at cost less accumulated impairment losses,if any. Goodwill is not amortised but instead tested for impairment annually or more frequentlyif events or changes in circumstances indicate that the carrying amount may be impaired.Gains and losses on the disposal of an entity include the carrying amount of goodwill relatingto the entity sold.

4.9 Property development activities

(a) Land held for property development

Land held for property development is stated at cost less impairment losses, if any. Suchland is classified as non-current asset when no significant development work has beencarried out or where development activities are not expected to be completed withinthe normal operating cycle.

Cost associated with the acquisition of land includes the purchase price of the land,professional fees, stamp duties, commissions, conversion fees and other relevant levies

Land held for property development is reclassified as property development costs atthe point when development activities have commenced and where it can bedemonstrated that the development activities can be completed within the normaloperating cycle.



4.9 Property development activities (cont’d)

(b) Property development costs

Property development costs comprise all cost that are directly attributable to thedevelopment activities or that can be allocated on a reasonable basis to such activities. They comprise the cost of land under development, construction costs and other relateddevelopment costs common to the whole project including professional fees, stampduties, commissions, conversion fees and other relevant levies as well as borrowingcosts.

Property development costs not recognised as an expense are recognised as an assetmeasured at the lower of cost and net realisable value.

When revenue recognised in profit or loss exceeds progress billings to purchasers, thebalance is classified as accrued billings under current assets. When progress billingsexceed revenue recognised in profit or loss, the balance is classified as progress billingsunder current liabilities.

4.10 Inventories

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

Cost is determined using the first-in, first-out formula. The cost of raw materials comprisesall costs of purchase plus the cost of bringing the inventories to their present location andcondition. The cost of work-in-progress and finished goods includes the cost of raw materials,direct labour, other direct cost and a proportion of production overheads based on normaloperating capacity of the production facilities. The cost of completed properties held forsale comprises cost associated with the acquisition of land, direct costs and appropriateproportions of common costs.

Net realisable value is the estimated selling price in the ordinary course of business, less theestimated costs of completion and the estimated costs necessary to make the sale.

4.11 Impairment of non-financial assets

The carrying amount of assets, except for financial assets (excluding investments in subsidiariesand associates), inventories, property development costs, deferred tax assets and non-currentassets (or disposal groups) held for sale, are reviewed at the end of each reporting period todetermine whether there is any indication of impairment. If any such indication exists, theasset’s recoverable amount is estimated.

Goodwill and intangible assets that have an indefinite useful life are tested annually forimpairment or more frequently if events or changes in circumstances indicate that thegoodwill or intangible asset might be impaired.

The recoverable amount of an asset is estimated for an individual asset. Where it is notpossible to estimate the recoverable amount of the individual asset, the impairment test iscarried out on the cash generating unit (”CGU”) to which the asset belongs. Goodwill acquiredin a business combination is from the acquisition date, allocated to each of the Group’s CGUor groups of CGU that are expected to benefit from the synergies of the combination givingrise to the goodwill irrespective of whether other assets or liabilities of the acquiree areassigned to those units or groups of units.




4.11 Impairment of non-financial assets (cont’d)

Goodwill acquired in a business combination shall be tested for impairment as part of theimpairment testing of CGU to which it relates. The CGU to which goodwill is allocated shallrepresent the lowest level within the Group at which the goodwill is monitored for internalmanagement purposes and not larger than an operating segment determined in accordancewith FRS 8.

The recoverable amount of an asset or CGU is the higher of its fair value less cost to sell andits value in use.

In estimating the value in use, the estimated future cash inflows and outflows to be derivedfrom continuing use of the asset and from its ultimate disposal are discounted to their presentvalue using a pre-tax discount rate that reflects current market assessments of the time valueof money and the risks specific to the asset for which the future cash flow estimates havenot been adjusted. An impairment loss is recognised in profit or loss when the carryingamount of the asset or the CGU, including the goodwill or intangible asset, exceeds therecoverable amount of the asset or the CGU. The total impairment loss is allocated, first, toreduce the carrying amount of any goodwill allocated to the CGU and then to the otherassets of the CGU on a pro-rata basis of the carrying amount of each asset in the CGU.

The impairment loss is recognised in profit or loss immediately except for the impairmenton a revalued asset where the impairment loss is recognised directly against the revaluationreserve to the extent of the surplus credited from the previous revaluation for the same assetwith the excess of the impairment loss charged to profit or loss.

An impairment loss on goodwill is not reversed in subsequent periods. An impairment lossfor other assets is reversed if, and only if, there has been a change in the estimates used todetermine the assets’ recoverable amount since the last impairment loss was recognised.

An impairment loss is reversed only to the extent that the asset’s carrying amount does notexceed the carrying amount that would have been determined, net of depreciation oramortisation, if no impairment loss had been recognised.

Such reversals are recognised as income immediately in profit or loss except for the reversalof an impairment loss on a revalued asset where the reversal of the impairment loss is treatedas a revaluation increase and credited to the revaluation reserve account of the same asset.However, to the extent that an impairment loss in the same revalued asset was previouslyrecognised in profit or loss, a reversal of that impairment loss is also recognised in profit orloss.

4.12 Financial instruments

A financial instrument is any contract that gives rise to a financial asset of one enterprise anda financial liability or equity instrument of another enterprise.

A financial asset is any asset that is cash, an equity instrument of another enterprise, acontractual right to receive cash or another financial asset from another enterprise, or acontractual right to exchange financial assets or financial liabilities with another enterpriseunder conditions that are potentially favourable to the Group.




4.12 Financial instruments (cont’d)

A financial liability is any liability that is a contractual obligation to deliver cash or anotherfinancial asset to another enterprise, or a contractual obligation to exchange financial assetsor financial liabilities with another enterprise under conditions that are potentially unfavourableto the Group.

Financial instruments are recognised on the statement of financial position when the Grouphas become a party to the contractual provisions of the instrument. At initial recognition,a financial instrument is recognised at fair value plus, in the case of a financial instrumentnot at fair value through profit or loss, transaction costs that are directly attributable to theacquisition or issuance of the financial instrument.

An embedded derivative is separated from the host contract and accounted for as a derivativeif, and only if the economic characteristics and risks of the embedded derivative is not closelyrelated to the economic characteristics and risks of the host contract, a separate instrumentwith the same terms as the embedded derivative meets the definition of a derivative, andthe hybrid instrument is not measured at fair value through profit or loss.

(a) Financial assets

A financial asset is classified into the following four categories after initial recognitionfor the purpose of subsequent measurement:

(i) Financial assets at fair value through profit or loss

Financial assets at fair value through profit or loss comprise financial assets that areheld for trading (i.e. financial assets acquired principally for the purpose of resalein the near term), derivatives (both, freestanding and embedded) and financialassets that were specifically designated into this classification upon initial recognition.

Subsequent to initial recognition, financial assets classified as at fair value throughprofit or loss are measured at fair value. Any gains or losses arising from changesin the fair value of financial assets classified as at fair value through profit or loss arerecognised in profit or loss. Net gains or losses on financial assets classified as atfair value through profit or loss exclude foreign exchange gains and losses, interestand dividend income. Such income is recognised separately in profit or loss ascomponents of other income or other operating losses.

However, derivatives that is linked to and must be settled by delivery of unquotedequity instruments that do not have a quoted market price in an active market arerecognised at cost.

(ii) Held-to-maturity investments

Financial assets classified as held-to-maturity comprise non-derivative financialassets with fixed or determinable payments and fixed maturity that the Group hasthe positive intention and ability to hold to maturity.

Subsequent to initial recognition, financial assets classified as held-to-maturity aremeasured at amortised cost using the effective interest method. Gains or losses onfinancial assets classified as held-to-maturity are recognised in profit or loss whenthe financial assets are derecognised or impaired, and through the amortisationprocess.





(iii) Loans and receivables

Financial assets classified as loans and receivables comprise non-derivative financialassets with fixed or determinable payments that are not quoted in an active market.

Subsequent to initial recognition, financial assets classified as loans and receivablesare measured at amortised cost using the effective interest method. Gains or losseson financial assets classified as loans and receivables are recognised in profit or losswhen the financial assets are derecognised or impaired, and through the amortisationprocess.

(iv) Available-for-sale financial assets

Financial assets classified as available-for-sale comprise non-derivative financialassets that are designated as available for sale or are not classified as loans andreceivables, held-to-maturity investments or financial assets at fair value throughprofit or loss.

Subsequent to initial recognition, financial assets classified as available-for-sale aremeasured at fair value. Any gains or losses arising from changes in the fair value offinancial assets classified as available-for-sale are recognised directly in othercomprehensive income, except for impairment losses and foreign exchange gainsand losses, until the financial asset is derecognised, at which time the cumulativegains or losses previously recognised in other comprehensive income are recognisedin profit or loss. However, interest calculated using the effective interest methodis recognised in profit or loss whilst dividends on available-for-sale equity instrumentsare recognised in profit or loss when the Group’s right to receive payment isestablished.

Cash and cash equivalents include cash and bank balances, bank overdrafts, depositsand other short term, highly liquid investments with original maturities of three (3)months or less, which are readily convertible to cash and are subject to insignificant riskof changes in value.

A financial asset is derecognised when the contractual right to receive cash flows fromthe financial asset has expired. On derecognition of a financial asset in its entirety, thedifference between the carrying amount and the sum of consideration received (includingany new asset obtained less any new liability assumed) and any cumulative gain or lossthat had been recognised directly in other comprehensive income shall be recognisedin profit or loss.

A regular way purchase or sale is a purchase or sale of a financial asset under a contractwhose terms require delivery of the asset within the time frame established generallyby regulation or marketplace convention. A regular way purchase or sale of financialassets shall be recognised and derecognised, as applicable, using trade date accounting.







(b) Financial liabilities

Financial instruments are classified as liabilities or equity in accordance with the substanceof the contractual arrangement. A financial liability is classified into the following twocategories after initial recognition for the purpose of subsequent measurement:

(i) Financial liabilities at fair value through profit or loss

Financial liabilities at fair value through profit or loss comprise financial liabilitiesthat are held for trading, derivatives (both, freestanding and embedded) and financialliabilities that were specifically designated into this classification upon initialrecognition.

Subsequent to initial recognition, financial liabilities classified as at fair value throughprofit or loss are measured at fair value. Any gains or losses arising from changesin the fair value of financial liabilities classified as at fair value through profit or lossare recognised in profit or loss. Net gains or losses on financial liabilities classifiedas at fair value through profit or loss exclude foreign exchange gains and losses,interest and dividend income. Such income is recognised separately in profit or lossas components of other income or other operating losses.

(ii) Other financial liabilities

Financial liabilities classified as other financial liabilities comprise non-derivativefinancial liabilities that are neither held for trading nor initially designated as at fairvalue through profit or loss.

Subsequent to initial recognition, other financial liabilities are measured at amortisedcost using the effective interest method. Gains or losses on other financial liabilitiesare recognised in profit or loss when the financial liabilities are derecognised andthrough the amortisation process.

A financial liability is derecognised when, and only when, it is extinguished, i.e. whenthe obligation specified in the contract is discharged or cancelled or expires. An exchangebetween an existing borrower and lender of debt instruments with substantially differentterms are accounted for as an extinguishment of the original financial liability and therecognition of a new financial liability. Similarly, a substantial modification of the termsof an existing financial liability is accounted for as an extinguishment of the originalfinancial liability and the recognition of a new financial liability.

The difference between the carrying amount of a financial liability extinguished ortransferred to another party and the consideration paid, including any non-cash assetstransferred or liabilities assumed, is recognised in profit or loss.

A financial guarantee contract is a contract that requires the issuer to make specifiedpayments to reimburse the holder for a loss it incurs because a specified debtor fails tomake payment when due in accordance with the original or modified terms of a debtinstrument.




The Group designates corporate guarantees given to banks for credit facilities grantedto subsidiaries as insurance contracts as defined in FRS 4 Insurance Contracts. The Grouprecognises these insurance contracts as recognised insurance liabilities when there isa present obligation, legal or constructive, as a result of a past event, when it is probablethat an outflow of resources embodying economic benefits will be required to settle theobligation and a reliable estimate can be made of the amount of the obligation.

At the end of every reporting period, the Group shall assess whether its recognisedinsurance liabilities are adequate, using current estimates of future cash flows under itsinsurance contracts. If this assessment shows that the carrying amount of the insuranceliabilities is inadequate, the entire deficiency shall be recognised in profit or loss.

Recognised insurance liabilities are only removed from the statement of financial positionwhen, and only when, it is extinguished via a discharge, cancellation or expiration.

(c) Equity

An equity instrument is any contract that evidences a residual interest in the assets ofthe Group and the Company after deducting all of its liabilities. Ordinary shares areclassified as equity instruments.

Ordinary shares are recorded at the nominal value and proceeds in excess of the nominalvalue of shares issued, if any, are accounted for as share premium. Both ordinary sharesand share premium are classified as equity. Transaction costs of an equity transactionare accounted for as a deduction from equity, net of any related income tax benefit.Otherwise, they are charged to profit or loss.

Interim dividends to shareholders are recognised in equity in the period in which theyare declared. Final dividends are recognised upon the approval of shareholders in ageneral meeting.

The Group measures a liability to distribute non-cash assets as a dividend to the ownersof the Company at the fair value of the assets to be distributed. The carrying amount ofthe dividend is remeasured at each reporting date and at the settlement date, with anychanges recognised directly in equity as adjustments to the amount of the distribution.On settlement of the transaction, the Group recognises the difference, if any, betweenthe carrying amount of the assets distributed and the carrying amount of the liabilityin profit or loss.

If the Company reacquires its own equity instruments, the consideration paid, includingany attributable transaction costs is deducted from equity as treasury shares until theyare cancelled. No gain or loss is recognised in profit or loss on the purchase, sale, issueor cancellation of the Company’s own equity instruments. Where such shares are issuedby resale, the difference between the sales consideration and the carrying amount isshown as a movement in equity.





4.13 Impairment of financial assets

The Group assesses whether there is any objective evidence that a financial asset is impairedat the end of each reporting period.

Loans and receivables

The Group collectively considers factors such as the probability of bankruptcy or significantfinancial difficulties of the receivable and default or significant delay in payments to determinewhether there is objective evidence that an impairment loss on loans and receivables hasoccurred. Other objective evidence of impairment include historical collection ratesdetermined on an individual basis and observable changes in national or local economicconditions that are directly correlated with the historical default rates of receivables.

If any such objective evidence exists, the amount of impairment loss is measured as thedifference between the financial asset’s carrying amount and the present value of estimatedfuture cash flows discounted at the financial asset’s original effective interest rate. Theimpairment loss is recognised in profit or loss.

The carrying amount of loans and receivables is reduced through the use of an allowanceaccount.

If in a subsequent period, the amount of the impairment loss decreases and it objectivelyrelates to an event occurring after the impairment was recognised, the previously recognisedimpairment loss is reversed to the extent that the carrying amount of the asset does notexceed its amortised cost at the reversal date. The amount of impairment reversed isrecognised in profit or loss.

4.14 Borrowing costs

All borrowing cost is recognised in profit or loss in the period in which they are incurred.

4.15 Provisions

Provisions are recognised when there is a present obligation, legal or constructive, as a resultof a past event, when it is probable that an outflow of resources embodying economicbenefits will be required to settle the obligation and a reliable estimate can be made of theamount of the obligation.

When the effect of the time value of money is material, the amount of a provision will bediscounted to its present value at a pre-tax rate that reflects current market assessments ofthe time value of money and the risks specific to the liability.

Provisions are reviewed at the end of each reporting period and adjusted to reflect thecurrent best estimate. If it is no longer probable that an outflow of resources embodyingeconomic benefits will be required to settle the obligation, the provision will be reversed.

Provisions are not recognised for future operating losses. If the Group has a contract that isonerous, the present obligation under the contract shall be recognised and measured as aprovision.





4.16 Income taxes

Taxes in the income statement comprise current tax and deferred tax.

(a) Current tax

Current tax is the amount of income taxes payable or receivable in respect of the taxableprofit or loss for a period.

Current tax for the current and prior periods is measured at the amount expected to berecovered from or paid to the taxation authorities. The tax rates and tax laws used tocompute the amount are those that have been enacted or substantively enacted by theend of the reporting period.

(b) Deferred tax

Deferred tax is recognised in full using the liability method on temporary differencesarising between the carrying amount of an asset or liability in the statement of financialposition and its tax base.

Deferred tax is recognised for all temporary differences, unless the deferred tax arisesfrom goodwill or the initial recognition of an asset or liability in a transaction which isnot a business combination and at the time of transaction, affects neither accountingprofit nor taxable profit.

A deferred tax asset is recognised only to the extent that it is probable that taxable profitswill be available against which the deductible temporary differences, unused tax lossesand unused tax credits can be utilised. The carrying amount of a deferred tax asset isreviewed at the end of each reporting period. If it is no longer probable that sufficienttaxable profits will be available to allow the benefit of part or all of that deferred taxasset to be utilised, the carrying amount of the deferred tax asset will be reducedaccordingly. When it becomes probable that sufficient taxable profits will be available,such reductions will be reversed to the extent of the taxable profits.

Deferred tax assets and liabilities are offset when there is a legally enforceable right toset off current tax assets against current tax liabilities and when the deferred incometaxes relate to the same taxation authority on either:

(i) either the same taxable entity; or

(ii) different taxable entities which intend either to settle current tax liabilities and assetson a net basis, or to realise the assets and settle the liabilities simultaneously, ineach future period in which significant amounts of deferred tax liabilities or assetsare expected to be settled or recovered.

Deferred tax will be recognised as income or expense and included in the profit or lossfor the period unless the tax relates to items that are credited or charged, in the sameor a different period, directly to equity, in which case the deferred tax will be chargedor credited directly to equity.




4.16 Income taxes (cont’d)

Deferred tax assets and liabilities are measured at the tax rates that are expected to applyto the year when the asset is realised or the liability is settled, based on tax rates and tax lawsthat have been enacted or substantively enacted by the reporting period.

4.17 Contingent liabilities and contingent assets

A contingent liability is a possible obligation that arises from past events whose existencewill be confirmed by the occurrence or non-occurrence of one or more uncertain futureevents beyond the control of the Group or a present obligation that is not recognised becauseit is not probable that an outflow of resources will be required to settle the obligation. Acontingent liability also arises in extremely rare cases where there is a liability that cannotbe recognised because it cannot be measured reliably. The Group does not recognise acontingent liability but discloses its existence in the financial statements.

A contingent asset is a possible asset that arises from past events whose existence will beconfirmed by the occurrence or non-occurrence of one or more uncertain future eventsbeyond the control of the Group. The Group does not recognise contingent assets butdisclose its existence where inflows of economic benefits are probable, but not virtuallycertain.

In the acquisition of subsidiaries by the Group under business combinations, contingentliabilities assumed are measured initially at their fair value at the acquisition date, irrespectiveof the extent of any non-controlling interest.

4.18 Employee benefits

(a) Short term employee benefits

Wages, salaries, social security contributions, paid annual leave, paid sick leave, bonusesand non-monetary benefits are recognised as an expense in the financial year whenemployees have rendered their services to the Group.

Short term accumulating compensated absences such as paid annual leave are recognisedas an expense when employees render services that increase their entitlement to futurecompensated absences. Short term non-accumulating compensated absences such assick leave are recognised when the absences occur.

Bonuses are recognised as an expense when there is a present, legal or constructiveobligation to make such payments, as a result of past events and when a reliable estimatecan be made of the amount of the obligation.

(b) Defined contribution plans

The Company and its subsidiaries make contributions to a statutory provident fund. Thecontributions are recognised as a liability after deducting any contribution already paidand as an expense in the period in which the employees render their services.



4.19 Foreign currencies

(a) Functional and presentation currency

Items included in the financial statements of each of the Group’s entities are measuredusing the currency of the primary economic environment in which the entity operates(’the functional currency’). The consolidated financial statements are presented in RinggitMalaysia, which is the Company’s functional and presentation currency.

(b) Foreign currency translations and balances

Transactions in foreign currencies are converted into Ringgit Malaysia at rates of exchangeruling at the transaction dates. Monetary assets and liabilities in foreign currencies atthe end of the reporting period are translated into Ringgit Malaysia at rates of exchangeruling at that date. All exchange differences arising from the settlement of foreigncurrency transactions and from the translation of foreign currency monetary assets andliabilities are included in profit or loss in the period in which they arise. Non-monetaryitems initially denominated in foreign currencies, which are carried at historical cost aretranslated using the historical rate as of the date of acquisition, and non-monetary itemswhich are carried at fair value are translated using the exchange rate that existed whenthe values were determined for presentation currency purposes.

(c) Foreign operations

Financial statements of foreign operations are translated at end of the reporting periodexchange rates with respect to their assets and liabilities, and at exchange rates at thedates of the transactions with respect to the statement of comprehensive income. Allresulting translation differences are recognised as a separate component of equity

In the consolidated financial statements, exchange differences arising from the translationof net investment in foreign operations are taken to equity. When a foreign operationis partially disposed off or sold, exchange differences that were recorded in equity arerecognised in profit or loss as part of the gain or loss on disposal.

Exchange differences arising on a monetary item that forms part of the net investmentof the Company in a foreign operation shall be recognised in profit or loss in the separatefinancial statements of the Company or the foreign operation, as appropriate. In theconsolidated financial statements, such exchange differences shall be recognised initiallyas a separate component of equity and recognised in profit or loss upon disposal of thenet investment

Goodwill and fair value adjustments to the assets and liabilities arising from the acquisitionof a foreign operation are treated as assets and liabilities of the acquired entity andtranslated at the exchange rate ruling at the end of the reporting period.




4.20 Revenue recognition

Revenue is measured at the fair value of the consideration received or receivable net ofdiscounts and rebates.

Revenue is recognised to the extent that it is probable that the economic benefits associatedwith the transaction will flow to the Group, and the amount of revenue and the cost incurredor to be incurred in respect of the transaction can be reliably measured and specific recognitioncriteria have been met for each of the Group’s activities as follows:

(a) Sale of goods

Revenue from sale of goods is recognised when significant risk and rewards of ownershipof the goods has been transferred to the customer and where the Group retains neithercontinuing managerial involvement over the goods, which coincides with the deliveryof goods and acceptance by customers.

(b) Services

Revenue in respect of the rendering of services is recognised when the stage of completionat the end of the reporting period and the cost incurred can be reliably measured. Thestage of completion is determined by the services performed to date as a percentageof total services to be performed.

(c) Property development

Property development revenue is recognised in respect of all development units thathave been sold. Revenue recognition commences when the sale of the developmentunit is effected, upon the commencement of development and construction activitiesand when the financial outcome can be reliably estimated. The attributable portion ofproperty development cost is recognised as an expense in the period in which the relatedrevenue is recognised. The amount of such revenue and expenses recognised isdetermined by reference to the stage of completion of development activity at the endof the reporting period. The stage of completion is measured by reference to theproportion that property development costs incurred for work performed to date bearto the estimated total property development cost.

When the financial outcome of a development activity cannot be reliably estimated, theproperty development revenue is recognised only to the extent of property developmentcosts incurred that is probable to be recoverable and the property development costson the development units sold are recognised as an expense in the period in which theyare incurred.

Any expected loss on a development project is recognised as an expense immediately,including costs to be incurred over the defects liability period.

(d) Interest income

Interest income is recognised as it accrues, using the effective interest method.





4.20 Revenue recognition (cont’d)

(e) Rental income

Rental income is accounted for on a straight line basis over the lease term of an ongoinglease. The aggregate cost of incentives provided to the lessee is recognised as reductionof rental income over the lease term on a straight line basis.

(f ) Management fee and other operating income

Management fee and other operating income are recognised on an accrual basis.

4.21 Operating segments

Operating segments are defined as components of the Group that:

(a) engages in business activities from which it may earn revenues and incur expenses(including revenues and expenses relating to transactions with other components ofthe Group);

(b) whose operating results are regularly reviewed by the Group’s chief operating decisionmaker (i.e. the Managing Director) in making decisions about resources to be allocatedto the segment and assessing its performance; and

(c) for which discrete financial information is available.

An operating segment may engage in business activities for which it has yet to earn revenues

The Group reports separately information about each operating segment that meets any ofthe following quantitative thresholds:

(a) Its reported revenue, including both sales to external customers and intersegment salesor transfers, is ten (10) per cent or more of the combined revenue, internal and external,of all operating segments.

(b) The absolute amount of its reported profit or loss is ten (10) per cent or more of thegreater, in absolute amount of:

(i) the combined reported profit of all operating segments that did not report a loss; and

(ii) the combined reported loss of all operating segments that reported a loss.

(c) Its assets are ten (10) per cent or more of the combined assets of all operating segments

Operating segments that do not meet any of the quantitative thresholds may be consideredreportable, and separately disclosed, if the management believes that information aboutthe segment would be useful to users of the financial statements.



4.21 Operating segments (cont’d)

Total external revenue reported by operating segments shall constitute at least seventy five(75) percent of the Group’s revenue. Operating segments identified as reportable segmentsin the current financial year in accordance with the quantitative thresholds would result ina restatement of prior period segment data for comparative purposes.

4.22 Earnings per share

(a) Basic

Basic earnings per ordinary share for the financial year is calculated by dividing the profitfor the financial year attributable to equity holders of the parent by the weighted averagenumber of ordinary shares outstanding during the financial year.

(b) Diluted

Diluted earnings per ordinary share for the financial year is calculated by dividing theprofit for the financial year attributable to equity holders of the parent by the weightedaverage number of ordinary shares outstanding during the financial year adjusted forthe effects of dilutive potential ordinary shares.

5. ACCOUNTING STANDARDS

5.1 New Financial Reporting Standards (’FRSs’) and Amendments to FRSs adopted duringthe financial period

During the current financial year, the Company adopted the following new FRSs andAmendments to FRSs:

Title Effective DateAmendments to FRS 132 Financial Instruments: Presentation 1 March 2010IC Interpretation 12 Service Concession Arrangements 1 July 2010FRS 1 First-time Adoption of Financial Reporting Standards 1 July 2010FRS 3 Business Combinations 1 July 2010FRS 127 Consolidated and Separate Financial Statements 1 July 2010Amendments to FRS 2 Share-based Payment 1 July 2010Amendments to FRS 5 Non-Current Assets Held for Sale and Discontinued 1 July 2010

OperationsAmendments to FRS 138 Intangible Assets 1 July 2010IC Interpretation 16 Hedges of a Net Investment in a Foreign Operation 1 July 2010IC Interpretation 17 Distributions of Non-cash Assets to Owners 1 July 2010Amendments to IC Interpretation 9 Reassessment of Embedded Derivatives 1 July 2010Limited Exemption from Comparative FRS 7 Disclosures for First-time 1 January 2011

Adopters (Amendment to FRS 1)Additional Exemptions for First-time Adopters (Amendments to FRS 1) 1 January 2011Group Cash-settled Share-based Payment Transactions 1 January 2011

(Amendments to FRS 2)Improving Disclosures about Financial Instruments 1 January 2011

(Amendments to FRS 7)



5. ACCOUNTING STANDARDS (cont’d)

IC Interpretation 4 Determining Whether an Arrangement contains a Lease 1 January 2011IC Interpretation 18 Transfers of Assets from Customers 1 January 2011Improvements to FRSs (2010) 1 January 2011Mandatory Effective Date of MFRS 9 and Transition Disclosures Immediately

(Amendments to FRS 7)

There is no material impact upon adoption of the new FRSs and Amendments to FRSs during thecurrent financial period.

5.2 New Malaysian Financial Reporting Standards (’MFRS’) that have beenissued, but not yet effective and not yet adopted, for annual periods beginningon or after 1 January 2012

On 19 November 2011, the Malaysian Accounting Standards Board (’MASB’) announced theissuance of the new MFRS framework that is applicable to entities other than private entities.

The Group is expected to apply the MFRS framework for the financial year ending 31 March2013.

This would result in the Group preparing an opening MFRS statement of financial positionas at 1 January 2011 which adjusts for differences between the classification and measurementbases in the existing FRS framework versus that in the new MFRS framework. This would alsoresult in a restatement of the annual and quarterly financial performance for the financialperiod from 1 January 2011 to 31 March 2012 in accordance with MFRS which would formthe MFRS comparatives for the annual and quarterly financial performance for the financialyear ending 31 March 2013.

The MFRSs and IC Interpretations expected to be adopted are as follows:

Effective DateMFRS 1 First-time Adoption of Malaysian Financial Reporting Standards 1 January 2012MFRS 2 Share-based Payment 1 January 2012MFRS 3 Business Combinations 1 January 2012MFRS 4 Insurance Contracts 1 January 2012MFRS 5 Non-current Assets Held for Sale and Discontinued Operations 1 January 2012MFRS 6 Exploration for and Evaluation of Mineral Resources 1 January 2012MFRS 7 Financial Instruments: Disclosures 1 January 2012MFRS 8 Operating Segments 1 January 2012MFRS 9 Financial Instruments 1 January 2015MFRS 10 Consolidated Financial Statements 1 January 2013MFRS 11 Joint Arrangements 1 January 2013MFRS 12 Disclosure of Interests in Other Entities 1 January 2013MFRS 13 Fair Value Measurement 1 January 2013MFRS 101 Presentation of Financial Statements 1 January 2012Amendments to MFRS 101 Presentation of Items of Other 1 July 2012

Comprehensive IncomeMFRS 102 Inventories 1 January 2012MFRS 107 Statement of Cash Flows 1 January 2012MFRS 108 Accounting Policies, Changes in Accounting Estimates and Errors 1 January 2012



5. ACCOUNTING STANDARDS (cont’d)5.2 New Malaysian Financial Reporting Standards (’MFRS’) that have been

issued, but not yet effective and not yet adopted, for annual periods beginningon or after 1 January 2012 (cont’d)

MFRS 110 Events After the Reporting Period 1 January 2012MFRS 111 Construction Contracts 1 January 2012MFRS 112 Income Taxes 1 January 2012MFRS 116 Property, Plant and Equipment 1 January 2012MFRS 117 Leases 1 January 2012MFRS 118 Revenue 1 January 2012MFRS 119 Employee Benefits 1 January 2012MFRS 119 Employee Benefits (revised) 1 January 2013MFRS 120 Accounting for Government Grants and Disclosure of Government 1 January 2012

AssistanceMFRS 121 The Effects of Changes in Foreign Exchange Rates 1 January 2012MFRS 123 Borrowing Costs 1 January 2012MFRS 124 Related Party Disclosures 1 January 2012MFRS 126 Accounting and Reporting by Retirement Benefit Plans 1 January 2012MFRS 127 Consolidated and Separate Financial Statements 1 January 2012MFRS 127 Separate Financial Statements 1 January 2013MFRS 128 Investments in Associates 1 January 2012MFRS 128 Investments in Associates and Joint Ventures 1 January 2013MFRS 129 Financial Reporting in Hyperinflationary Economies 1 January 2012MFRS 131 Interests in Joint Ventures 1 January 2012MFRS 132 Financial Instruments: Presentation 1 January 2012MFRS 133 Earnings Per Share 1 January 2012MFRS 134 Interim Financial Reporting 1 January 2012MFRS 136 Impairment of Assets 1 January 2012MFRS 137 Provisions, Contingent Liabilities and Contingent Assets 1 January 2012MFRS 138 Intangible Assets 1 January 2012MFRS 139 Financial Instruments: Recognition and Measurement 1 January 2012MFRS 140 Investment Property 1 January 2012MFRS 141 Agriculture 1 January 2012Improvements to MFRSs (2008) 1 January 2012Improvements to MFRSs (2009) 1 January 2012Improvements to MFRSs (2010) 1 January 2012Amendments to MFRS 1 Government Loans 1 January 2013Amendments to MFRS 7 Disclosures - Offsetting Financial Assets and 1 January 2013

Financial LiabilitiesAmendments to MFRS 132 Offsetting Financial Assets and 1 January 2014

Financial LiabilitiesMandatory Effective Date of MFRS 9 and Transition Disclosures 1 January 2015



5. ACCOUNTING STANDARDS (cont’d)5.2 New Malaysian Financial Reporting Standards (’MFRS’) that have been

issued, but not yet effective and not yet adopted, for annual periods beginningon or after 1 January 2012 (cont’d)

IC Interpretation 1 Changes in Existing Decommissioning, Restoration 1 January2012dan Similar Liabilities

IC Interpretation 2 Members’ Shares in Co-operative Entities 1 January 2012 and Similar Instruments

IC Interpretation 4 Determining Whether an Arrangement Contains a Lease 1 January 2012IC Interpretation 5 Rights to Interests Arising from Decommissioning, 1 January 2012

Restoration and Environmental Rehabilitation FundsIC Interpretation 6 Liabilities Arising from Participating in a Specific Market 1 January 2012

Waste Electrical and Electronic EquipmentIC Interpretation 7 Applying the Restatement Approach under MFRS 129 1 January 2012

Financial Reporting in Hyperinflationary EconomiesIC Interpretation 9 Reassessment of Embedded Derivatives 1 January 2012IC Interpretation 10 Interim Financial Reporting and Impairment 1 January 2012IC Interpretation 12 Service Concession Arrangements 1 January 2012IC Interpretation 13 Customer Loyalty Programmes 1 January 2012IC Interpretation 14 MFRS 119 - The Limit on a Defined Benefit Asset, 1 January 2012

Minimum Funding Requirements and their InteractionIC Interpretation 15 Agreements for the Construction of Real Estate 1 January 2012IC Interpretation 16 Hedges of a Net Investment in a Foreign Operation 1 January 2012IC Interpretation 17 Distributions of Non-cash Assets to Owners 1 January 2012IC Interpretation 18 Transfers of Assets from Customers 1 January 2012IC Interpretation 19 Extinguishing Financial Liabilities with 1 January 2012

Equity InstrumentsIC Interpretation 20 Stripping Costs in the Production Phase of a Surface Mine 1 January 2013IC Interpretation 107 Introduction of the Euro 1 January 2012IC Interpretation 110 Government Assistance - No Specific Relation to 1 January 2012

Operating ActivitiesIC Interpretation 112 Consolidation - Special Purpose Entities 1 January 2012IC Interpretation 113 Jointly Controlled Entities - Non-Monetary 1 January 2012

Contributions by VenturersIC Interpretation 115 Operating Leases - Incentives 1 January 2012IC Interpretation 125 Income Taxes - Changes in the Tax Status of an Entity 1 January 2012

or its ShareholdersIC Interpretation 127 Evaluating the Substance of Transactions Involving the 1 January 2012

Legal Form of a LeaseIC Interpretation 129 Service Concession Arrangements: Disclosures 1 January 2012IC Interpretation 131 Revenue - Barter Transactions Involving 1 January 2012

Advertising ServicesIC Interpretation 132 Intangible Assets - Web Site Costs 1 January 2012

The Group is in the process of assessing the impact of implementing the MFRS frameworksince the effects would only be observable for the financial year ending 31 March 2013.





6. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS

6.1 Changes in estimates

There are no significant changes in accounting estimates during the financial period.

6.2 Critical judgement

The following are judgements made by management in the process of applying the Group’saccounting policies that have the most significant effect on the amounts recognised in thefinancial statements.

(a) Non-current assets and disposal group held for sale

Certain non-current assets, current assets and current liabilities have been classified asnon-current assets and disposal group held for sale as the management has committedto a plan to sell the assets and liabilities as at the end of the reporting period. Barringany unforeseen circumstances, the Group expects that the sale of the assets and liabilitiesto be completed within the next twelve (12) months.

(b) Contingent liabilities

The determination of treatment of contingent liabilities is based on management's viewof the expected outcome of the contingencies for matters in the ordinary course of thebusiness.

6.3 Key sources of estimation uncertainty

The following are key assumptions concerning the future and other key sources of estimationuncertainty at the end of the reporting period that have a significant risk of causing a materialadjustment to the carrying amounts of assets and liabilities within the next financial year.

(a) Depreciation of plant and machinery

The cost of plant and machinery is depreciated on a straight-line basis over the assets'useful lives. The estimated useful lives applied by the Group as disclosed in Note 4.4 tothe financial statements reflects the Directors' estimate of the period that the Groupexpects to derive future economic benefits from the use of the Group's plant andmachinery. These are common life expectancies applied in various business segmentsof the Group. Changes in the expected level of usage and technological developmentscould impact the economic useful lives and the residual values of these assets, andtherefore future depreciation charges could be revised.

(b) Deferred tax assets

Deferred tax assets are recognised for all deductible temporary timing differences to theextent that it is probable that taxable profits will be available against which the deductibletemporary timing differences can be utilised. Significant management judgement isrequired to determine the amount of deferred tax assets that can be recognised, basedupon the likely timing and level of future taxable profits together with future tax planningstrategies.


6. SIGNIFICANT ACCOUNTING ESTIMATES AND JUDGEMENTS (cont’d)

6.3 Key sources of estimation uncertainty (cont’d)

(c) Impairment of receivables

The Group makes impairment of receivables based on an assessment of the recoverabilityof receivables. Impairment is applied to receivables where events or changes incircumstances indicate that the carrying amounts may not be recoverable. Themanagement specifically analyses historical bad debt, customer concentration, customercreditworthiness, current economic trends and changes in customer payment termswhen making a judgement to evaluate the adequacy of impairment of receivables.Where expectations differ from the original estimates, the differences will impact thecarrying amount of receivables.

(d) Property development

The Company recognises property development revenue and expenses in profit or lossby using the stage of completion method. The stage of completion is determined bythe proportion that the property development costs incurred for work performed todate bear to the estimated total property development costs.

Significant judgement is required in determining the stage of completion, the extent oftotal property development costs incurred, the estimated total property developmentrevenue and costs, as well as the recoverability of the development projects. In makingthe judgement, the Company evaluated based on the past experience and by relyingon the work of specialists.

(e) Fair values of borrowings

The fair values of borrowings are estimated by discounting future contractual cash flowsat the current market interest rates available to the Group for similar financial instruments.It is assumed that the effective interest rates approximate the current market interestrates available to the Group based on its size and its business risk.

(f) Impairment of goodwill on consolidation and investments in subsidiaries

The Group determines whether goodwill on consolidation is impaired at least on anannual basis. This requires an estimation of the recoverable amount of the subsidiariesto which goodwill is allocated.

The Company has also reviewed the carrying amounts of its investments in subsidiariesand when there are any indications of impairment, a similar impairment test has beenperformed, based on the expected discounted cash flow of these subsidiaries. Thecarrying amount of the investments in subsidiaries of the Company are as stated on thestatement of financial position.

Further details are disclosed in Notes 9 and 10 to the financial statements respectively.





7.

PRO

PERT

Y, P

LAN

T A

ND

EQ

UIP

MEN

TTr

ansf

er to

Depr

ecia

tion

asse

ts h

eld

char

ges f

orBa

lanc

e as

Disp

osal

of a

for s

ale

the f

inan

cial

Tran

slatio

nBa

lanc

e as

at 1

.1.2

011

Reva

luat

ion

Addi

tions

subs

idia

ryDi

spos

als

Writ

ten

off

(Not

e 18)

perio

d ad

just

men

tRe

class

ifica

tion

at 3

1.3.

2012

Grou

pRM

RMRM

RMRM

RMRM

RMRM

RMRM

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ying

amou

ntBu

ildin

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t cos

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64,93

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53,56

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00

(163

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846,3

75- a

t 201

2 valu

atio

n4,1

80,86

16,6

31,17

50

00

00

(162

,036)

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10,65

0,000

Long

term

leas

ehol

d lan

dat

2012

valu

atio

n77

4,485

4,400

,993

00

00

0(2

5,478

)0

05,1

50,00

0Pl

ant a

nd m

achi

nery

1,868

,626

093

1,435

(2,65

1,270

)(7

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8)(2

,542)

0(8

16,03

0)(1

6,537

)2,0

92,10

868

9,182

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lds

2,486

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78,61

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(2,09

2,108

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otor

vehi

cles

332,5

330

138,8

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6)(1

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)(3

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t8,4

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ctric

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tion

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n11

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11,03

2,168

2,647

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57)

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93)

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84

[---

------

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------

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t 31.

3.20

12---

------

------

------

------

---]

Accu

mul

ated

Carr

ying

Cost

Valu

atio

nde

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iatio

nam

ount

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RMRM

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ings

- at c

ost

915,0

000

68,62

584

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- at 2

012 v

aluat

ion

010

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000

10,65

0,000

Long

term

leas

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d lan

d at

2012

valu

atio

n0

5,150

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05,1

50,00

0Pl

ant a

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1,711

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22,78

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and

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92,76

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1,079

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rical

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d re

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tion

125,5

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53,43

472

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11,68

0,780

15,80

0,000

6,857

,796

20,62

2,984



7.

PRO

PERT

Y, P

LAN

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ND

EQ

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T (c

ont,d)

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nce a

sch

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s for

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at 1

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l per

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0 G

roup

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ts an

d eq

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[-

------

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t 31.

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------

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Valu

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atio

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2,243

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4,111

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term

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21,00

00

346,5

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t and

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1,868

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cles

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ce eq

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ent,

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iture

and

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gs2,9

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ents

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029

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0

28,23

6,813

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22,47

3,568

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8,245



7. PROPERTY, PLANT AND EQUIPMENT (cont’d)

[------------------------At 31.3.2012----------------------]Accumulated Carrying

Company Cost depreciation amountRM RM R M

Office equipment, furniture and fittings 10,450 10,450 0

[-----------------------At 31.12.2010---------------------]Accumulated Carrying

Company Cost depreciation amountRM RM R M

Office equipment, furniture and fittings 10,450 10,450 0

(a) The leasehold land and building of a subsidiary was revalued on 31 March 2012 by theDirectors based on a valuation exercise carried out in March 2012 by an independentprofessional valuer using the open market value basis.

Had the revalued assets been carried at cost less accumulated depreciation, the carryingamount would have been RM3,555,084 (2010: RM2,924,935).

(b) During the financial period, the Group made the following cash payments to purchaseproperty, plant and equipment:

Group31.3.2012 31.12.2010

RM RM

Purchase of property, plant and equipment 2,647,961 2,523,250Financed by hire purchase arrangements (311,629) 0Cash payment on purchase of property, plant and

equipment 2,336,332 2,523,250



7. PROPERTY, PLANT AND EQUIPMENT (cont’d)

(c) As at 31 March 2012, the carrying amount of the property, plant and equipment of the Groupunder hire purchase are as follows:

Group31.3.2012 31.12.2010

RM RM

Motor vehicles 25,827 159,092

Details of the terms and conditions of the hire purchase arrangements are disclosed in Notes26 to the financial statements.

(d) As at 31 March 2012, the unexpired lease periods of the short term leasehold land is 36 years(2010: 36 to 37 years). The short term leasehold land is charged as security for the bankingfacilities (Note 24) and for the redeemable secured loan stocks issued by the Company (Note21).

(e) As at 31 March 2012, certain property, plant and equipment of the Group with carryingamount of RM15,800,001 (2010: RM7,278,565) are charged to local banks as securities forbanking facilities as disclosed in Notes 23 and 24 to the financial statements.

(f) As at 31 March 2012, certain property, plant and equipment of the Group with carryingamount of RM15,800,001 (2010: RM4,955,347) are charged as securities for the redeemableconvertible secured loan stocks issued by the Company as disclosed in Note 21 to the financialstatements.

(g) As at 31 March 2012, certain motor vehicles of the Group with carrying amount of RM5 (2010:RM5) are registered in the names of certain Directors of the Group and third parties whohold them in trust for the subsidiaries.

Tran

sfer

toD

epre

ciat

ion

Impa

irmen

tas

sets

hel

dBa

lanc

e a

sch

arge

s for

the

loss

for t

hefo

r sal

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e a

sat

1.1

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1fin

anci

al p

erio

dfin

anci

al p

erio

d(N

ote

18)

at 3

1.3.

2012

Gro

upRM

RMRM

RMRM

Car

ryin

g am

ount

Free

hold

land

, at c

ost

4,18

7,56

10

(486

,667

)(3

,700

,894

)0

Bui

ldin

gs21

8,29

2(8

,125

)0

021

0,16

7

4,40

5,85

3(8

,125

)(4

86,6

67)

(3,7

00,8

94)

210,

167

[----

------

------

------

------

-At 3

1.3.

2012

------

------

------

------

-----]

Accu

mul

ated

depr

ecia

tion

Carr

ying

Cost

and

impa

irmen

tam

ount

RMRM

RM

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ldin

gs32

5,00

011

4,83

321

0,16

7

Dep

reci

atio

nIm

pairm

ent

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nce

as

char

ges f

or th

elo

ss fo

r the

Bala

nce

as

at 1

.1.2

010

Dis

posa

lsfin

anci

al y

ear

finan

cial

yea

rat

31.

12.2

010

Gro

upRM

RMRM

RMRM

Car

ryin

g am

ount

Free

hold

land

, at c

ost

4,18

7,56

10

00

4,18

7,56

1 B

uild

ings

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66,0

13)

(28,

152)

021

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66,0

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152)

04,

405,

853

[----

------

------

------

------

At 3

1.12

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0----

------

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]Ac

cum

ulat

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prec

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nCa

rryi

ngCo

stan

d im

pairm

ent

amou

ntRM

RMRM

Free

hold

land

, at c

ost

4,18

7,56

10

4,18

7,56

1 B

uild

ings

325,

000

106,

708

218,

292

4,51

2,56

110

6,70

84,

405,

853



8.IN

VES

TMEN

T PR

OPE

RTIE

S



Tran

sfer

toIm

pairm

ent

asse

ts h

eld

Bala

nce

as

loss

for t

hefo

r sal

eBa

lanc

e a

sat

1.1

.201

1fin

anci

al p

erio

d(N

ote

18)

at 3

1.3.

2012

Com

pany

RMRM

RMRM

Car

ryin

g am

ount

Free

hold

land

, at c

ost

2,80

0,00

0(4

86,6

67)

(2,3

13,3

33)

0

Dep

reci

atio

nIm

pairm

ent

Bala

nce

as

char

ges f

or th

elo

ss fo

r the

Bala

nce

as

at 1

.1.2

010

Addi

tions

Dis

posa

lsfin

anci

al y

ear

finan

cial

yea

rat

31.

12.2

010

Com

pany

RMRM

RMRM

RMRM

Car

ryin

g am

ount

Free

hold

land

, at c

ost

2,80

0,00

00

00

02,

800,

000

[----

------

------

------

------

At 3

1.12

.201

0----

------

------

------

------

]Ac

cum

ulat

edde

prec

iatio

nCa

rryi

ngCo

stan

d im

pairm

ent

amou

ntRM

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Free

hold

land

, at c

ost

2,80

0,00

00

2,80

0,00

0

8.IN

VES

TMEN

T PR

OPE

RTIE

S (c

ont,d)



8. INVESTMENT PROPERTIES (cont,d)

(a) The fair value of certain properties are based on Directors' estimation by reference to marketevidence of transaction prices for similar properties and recent experience in the locationand category of the properties being valued whilst the rest of properties in the Group arebased on valuation by an independent professional valuer.

The fair values of investment properties at the reporting date are as follows:

Group Company31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RMFreehold land 0 5,817,000 0 2,800,000Buildings 270,000 250,000 0 0

270,000 6,067,000 0 2,800,000

(b) The buildings which are leased out under operating leases amounted to RMNil (2010:RM218,292). The rental income earned by the Group from its investment properties duringthe financial period amounted to RMNil (2010: RM191,936).

(c) The title deed of a parcel of freehold land of the Company with carrying amount of RMNil(2010: RM2,800,000) is registered in the name of a subsidiary.

9. GOODWILLGroup

31.3.2012 31.12.2010RM RM

At 1 January 2011/31 March 2012 551,552 551,552

Goodwill acquired in a business combination is allocated, at acquisition, to the cash-generatingunit ("CGU") that is expected to benefit from that business combination. Before recognition ofany impairment losses, the carrying amount of goodwill had been allocated to the followingbusiness segments as independent CGUs:

Group31.3.2012 31.12.2010

RM RM

Property development 551,552 551,552



9. GOODWILL (cont’d)

The Group tests goodwill annually for impairment or more frequently if there are indications thatgoodwill might be impaired.

(a) Key assumptions used

The recoverable amount of a cash generating unit ("CGU") is determined based on fair valueless costs to sell. The fair value is based on the consideration to be received by the CGU uponthe completion of disposal of an indirect subsidiary.

(b) Sensitivity analysis

With regard to the assessment of fair value less cost to sell, management believes that noreasonably possible change in any of the above key assumptions would cause the recoverableamounts of the units to be materially below their carrying amounts.

10. INVESTMENT IN SUBSIDIARIESCompany

31.3.2012 31.12.2010RM RM

Unquoted sharesAt cost 40,941,162 49,982,791Less: Impairment losses (15,502,914) (21,866,294)

25,438,248 28,116,497

Details of the subsidiaries are as follows:

Country of Interest in equityName of company incorporation 31.3.2012 31.12.2010 Principal activities

Emico Penang Sdn. Bhd. Malaysia 100% 100% Manufacturing of originalequipment manufacturerproducts, awards, trophycomponents, medallions,souvenir, gift items,furniture products andgeneral trading

Emico Tools Sdn. Bhd. Malaysia 100% 100% Inactive

Emico Capital Sdn. Bhd. Malaysia 100% 100% Inactive

Emico Marketing Sdn. Malaysia 100% 100% Manufacturing andBhd. marketing of awards, trophy

components, souvenir itemsand general trading

Emico Development Malaysia 100% 100% Investment holding andSdn. Bhd. property development

Emico Newk Sdn. Bhd. * Malaysia 100% 100% Inactive



10. INVESTMENT IN SUBSIDIARIES (cont’d)


Mercu Tanah Langkawi Malaysia 71% 71% Investment holdingSdn. Bhd.

NEB Development Berhad Malaysia 60% 60% Investment holding, propertydevelopment and provisionof management services

Emico Creative Design Malaysia 100% 100% DormantSdn. Bhd.

Emico (Vietnam) Co. Ltd.* Vietnam 0% 100% Manufacturing of plasticproducts from plasticparticles, plastic and metalsouvenirs and householdutensils

Subsidiaries of Emico Marketing Sdn. Bhd.

Emico Melaka Sdn. Bhd. Malaysia 51% 51% Inactive

Emico Metalizing Sdn. Malaysia 100% 100% Offering chroming services Bhd.

Subsidiaries of NEB Development Berhad

NEB Pacific Sdn. Bhd. Malaysia 60% 60% Dormant

Unic Builders Sdn. Bhd. Malaysia 60% 60% Dormant

Subsidiaries of Emico Penang Sdn. Bhd.

Standard Trend Apparel Malaysia 53.3% 53.3% Inactive Industries Sdn. Bhd.

Emico Asia Sdn. Bhd. Malaysia 100% 100% Trading of houseware andfurniture

Subsidiary of Mercu Tanah Langkawi Sdn. Bhd.

Operasi Tembaga Sdn. Bhd. Malaysia 49.7% 49.7% Investment holding

Subsidiary of Operasi Tembaga Sdn. Bhd.

PKB-Operasi Tembaga Malaysia 39.8% 39.8% Property developmentSdn. Bhd.

* The financial statements of these companies are not audited by BDO, Malaysia.



10. INVESTMENT IN SUBSIDIARIES (cont’d)

(a) As at 31 March 2012, all the shares held by the Company in NEB Development Berhad andMercu Tanah Langkawi Sdn. Bhd. are charged as securities for the redeemable secured loanstocks (Note 21).

(b) On 6 March 2012, the Company had disposed of its wholly owned subsidiary, Emico (Vietnam)Co. Ltd., for a cash consideration of RM800,000.

(c) Impairment losses on investments in subsidiaries amounting to RM1,600,485 have beenrecognised during the financial period in order to write down the investments in subdiariesto their recoverable amounts. The recoverable amounts were determined based on a value-in-use calculation using cash flow projections based on financial budgets approved by themanagement covering a five (5)-year period. The discount rate applied to the cash flowprojections were 9.9% based on the weighted average cost of capital of the Company.

(d) A reversal of impairment loss on investment in subsidiaries amounting to RM7,963,865,relating to a subsidiary, Emico Vietnam Co. Ltd., has been recognised during the financialperiod due to disposal of the subsidiary during the financial period.

The disposal and deconsolidation of the subsidiary had the following effects on the financialposition of the Group as at the end of the financial period:

Group31.3.2012

RM

Property, plant and equipment (Note 7) 963,433Inventories 610,757Trade and other receivables 1,037,504Cash and cash equivalents 74,598Trade and other payables (3,188,624)Bank borrowings (631,597)

Net liabilities disposed and deconsolidated (1,133,929)Transfer from foreign currency translation reserve 977,057

(156,872)Waiver of debts (50,000)Total proceeds from disposal and deconsolidation (800,000)

Gain on disposal and deconsolidation to the Group (1,006,872)

Disposal and deconsolidation settled by:Cash (800,000)

Cash flow arising on disposal and deconsolidation:Cash consideration 800,000Cash and cash equivalents of subsidiary disposed and deconsolidated (74,598)

Net cash inflow on disposal and deconsolidation 725,402




11. INVESTMENT IN ASSOCIATES

Group31.3.2012 31.12.2010

RM RMUnquoted equity shares, at cost 1,024,800 2,887,273Share of post-acquisition results and reserves, net of dividend received (1,020,000) (1,197,923)Less: Impairment losses (4,800) (4,800)

0 1,684,550

The Group's interest in the associates is analysed as follows:

Group31.3.2012 31.12.2010

RM RMShare of net assets 0 1,678,752Premium on acquisition 0 5,798

0 1,684,550

The details of the associates are as follows:


Panashiba Industries (M) Malaysia 50% 50% Investment holdingSdn. Bhd.

PT Panashiba Industries Republic of 24.5% 24.5% InactiveIndonesia*@ Indonesia

Quanzhou Fuji-Sino People's 0% 20.9% Manufacturing, installing Elevators Co. Ltd.* Republic of maintaining lifts and

China escalators

Asian Elevator (M) Malaysia 24% 24% DormantSdn. Bhd.*

Jiangnan Escalator (M) Malaysia 18% 18% DormantSdn. Bhd.*

* The financial statements of these associates are not audited by BDO, Malaysia.

@ PT Panashiba Industries Indonesia is formed as a joint venture company on 1 April 1997 inIndonesia. The result of the operations of this associate have not been equity accounted forin the consolidated financial statements as it had ceased operations and has not recommencedoperations.


12. OTHER INVESTMENTS

Group31.3.2012 31.12.2010

RM RM

Unquoted shares in Malaysia, at cost 57,500 57,500Less: Impairment losses (57,500) (57,500)

0 0

13. PROPERTY DEVELOPMENT PROJECTSGroup

31.3.2012 31.12.2010Non-current Current Non-current Current

assets assets assets assetsRM RM RM RM

At 1 January 2011/1 January 2010- Freehold land 9,870,321 2,923,847 10,024,399 3,313,515- Development costs 18,895,845 19,235,202 18,974,267 28,048,305

28,766,166 22,159,049 28,998,666 31,361,820

Cost incurred/(reversed) during the financial period/year:- Development costs 194,013 5,265,662 89,573 6,828,587- Eliminated due to completion

of project 0 (4,222,610) 0 (8,219,242)- Transfer to inventories 0 (174,876) 0 (5,928,189)- Reversal of development cost

upon disposal of projects 0 (3,815,820) 0 0194,013 (2,947,644) 89,573 (7,318,844)

Costs recognised in profit or loss:At 1 January 2011/1 January 2010 0 (4,609,000) 0 (9,101,999)Recognised during the financial

period/year: 0 (2,719,000) 0 (5,932,001)Eliminated due to completion

of project 0 4,222,000 0 8,219,000Impairment loss on freehold land (742,555) 0 0 031 March 2012/31 December 2010 (742,555) (3,106,000) 0 (6,815,000)

Foreseeable loss 0 (1,275,000) 0 (786,000)

Transfer of non-current assets (to)/ from current assets of propertydevelopment costs:

- Freehold land (264,783) 264,783 (154,078) 154,078- Development costs 60,380 (60,380) (167,995) 167,995

(204,403) 204,403 (322,073) 322,073Transfer to assets held for

sale (Note 18) (25,270,504) (2,600,154) 0 0

31 March 2012/31 December 2010 2,742,717 12,434,654 28,766,166 16,764,049





13. PROPERTY DEVELOPMENT PROJECTS (cont’d)

The property development costs at end of the financial period/year are analysed as follows:

Group31.3.2012 31.12.2010

Non-current Current Non-current Currentassets assets assets assets

RM RM RM RM

Freehold land, at cost 733,109 768,244 9,870,321 3,467,593Development costs 2,009,608 11,666,410 18,895,845 13,296,456

2,742,717 12,434,654 28,766,166 16,764,049

The freehold land of a subsidiary with a total carrying value of RMNil (2010: RM11,133,013) ischarged as security for the redeemable secured loan stocks issued by the Company as mentionedin Note 21 to the financial statements.

14. DEFERRED TAX

(a) The deferred tax assets and liabilities are made up of the following:

Group31.3.2012 31.12.2010

RM RM

Balance as at 1 January (240,281) (301,669)Recognised in profit or loss (Note 34) (81,226) 61,388Recognised in other comprehensive income (2,758,041) 0

Balance as at 31 March 2012/31 December 2010 (3,079,548) (240,281)

Presented after appropriate offsetting:

Deferred tax assets, net 127,539 215,600Deferred tax liabilities, net (3,207,087) (455,881)

(3,079,548) (240,281)



14. DEFERRED TAX (cont’d)

(b) The components and movements of deferred tax liabilities and assets during the financialperiod/year prior to offsetting are as follows:

Deferred tax liabilities of the GroupRevaluation

surplus Property, plant of revaluedand equipment properties Total

RM RM RM

At 1 January 2011 455,881 0 455,881Recognised in profit or loss (6,836) 0 (6,836)Recognised in other comprehensive income 0 2,758,042 2,758,042

At 31 March 2012 449,045 2,758,042 3,207,087

At 1 January 2010 91,200 0 91,200Recognised in profit or loss 0 364,681 364,681

At 31 December 2010 91,200 364,681 455,881

Deferred tax assets of the Group

Unused tax lossesand unabsorbed

capital allowances TotalRM RM

At 1 January 2011 215,600 215,600Recognised in profit or loss (88,061) (88,061)

At 31 March 2012 127,539 127,539

At 1 January 2010 278,400 278,400Recognised in profit or loss (62,800) (62,800)

At 31 December 2010 215,600 215,600



14. DEFERRED TAX (cont’d)

(c) The amounts of temporary differences for which no deferred tax asset has been recognisedin the statement of financial position are as follows:

Group Company31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RM

Property, plant and equipment (559,200) (380,000) 0 0Others 305,200 265,600 0 0Unused tax losses 17,812,400 20,165,200 4,066,800 3,802,000

17,558,400 20,050,800 4,066,800 3,802,000

Deferred tax assets of certain subsidiaries have not been recognised in respect of these itemsas it is not probable that taxable profits of the subsidiaries will be available against whichthe deductible temporary differences can be utilised.

The deductible temporary differences do not expire under the current tax legislation.

15. INVENTORIESGroup

31.3.2012 31.12.2010RM RM

At costRaw materials 1,515,821 1,516,282Work-in-progress 1,221,771 1,156,692Finished goods 4,133,963 4,986,165Developed properties 3,190,657 9,602,160

10,062,212 17,261,299

At net realisable valueDeveloped properties 2,335,000 0

12,397,212 17,261,299

The write-down of inventories to net realisable value amounted to RM1,001,526 (2010: RMNil)and was included in cost of sales.



16. TRADE AND OTHER RECEIVABLES

Group Company31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RMTrade receivables

Third parties 10,264,743 10,950,256 0 0Accrued billing in respect of

property development costs 43,084 0 0 0Amount owing by related parties 907,142 483,953 0 0

11,214,969 11,434,209 0 0Less: Impairment loss- Third parties (678,336) (1,986,204) 0 0

10,536,633 9,448,005 0 0

Other receivables

Other receivables 2,813,397 2,302,346 0 0Amount owing by subsidiaries 0 0 55,764,073 58,242,228Amount owing by associates 127,607 127,607 0 0

2,941,004 2,429,953 55,764,073 58,242,228Less: Impairment loss- Other receivables (12,852) (12,852) 0 0- Amount owing by subsidiaries 0 0 (16,354,904) (16,768,874)- Amount owing by associates (127,607) (127,607) 0 0

2,800,545 2,289,494 39,409,169 41,473,354

Loans and receivables 13,337,178 11,737,499 39,409,169 41,473,354

Deposits and prepayments

Deposits 612,473 683,958 1,000 1,000Prepayments 373,461 125,706 30,000 0

985,934 809,664 31,000 1,000

14,323,112 12,547,163 39,440,169 41,474,354

(a) Trade receivables are non-interest bearing and the normal trade credit terms granted by theGroup on sale of goods and services rendered ranges from 21 to 120 days (2010: 30 to 120days) while the credit term for sales of properties ranges from 21 to 90 days (2010: 21 to 90days). They are recognised at their original invoice amounts which represent their fair valueson initial recognition.

(b) Amount owing by related parties are trade in nature, unsecured, interest-free and are repayableupon demand in cash and cash equivalents. The related parties are companies in whichcertain Directors and shareholders are connected to certain Directors of the Company.



16. TRADE AND OTHER RECEIVABLES (cont’d)

(c) Amount owing by subsidiaries arose mainly from transfer of bank borrowings from subsidiariespursuant to the debt restructuring scheme of the Group implemented in 2004 and unsecuredadvances which are interest-free and payable upon demand in cash and cash equivalents.

(d) The amount owing by associates arose mainly from advances which are unsecured, interest-free and payable upon demand in cash and cash equivalents.

(e) The currency exposure profile of receivables are as follows:

Group Company31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RM

Ringgit Malaysia 9,514,593 8,533,976 39,440,169 41,474,354United States Dollar 4,681,595 3,115,842 0 0Chinese Renminbi 27,645 39,116 0 0Singapore Dollar 0 4,450 0 0Euro 99,279 461 0 0Vietnamese Dong 0 853,318 0 0

14,323,112 12,547,163 39,440,169 41,474,354

(f) The ageing analysis of trade receivables of the Group is as follows:Group

31.3.2012 31.12.2010RM RM

Neither past due nor impaired 8,725,652 7,866,414Past due, not impaired1 to 30 days 414,210 462,77031 to 60 days 760,026 655,21861 to 90 days 36,521 413,888More than 90 days 600,224 49,715

1,810,981 1,581,591Past due and impaired 678,336 1,986,204

11,214,969 11,434,209

Receivables that are neither past due nor impairedTrade receivables that are neither past due nor impaired are creditworthy debtors with goodpayment records with the Group.

None of the Group's trade receivables that are neither past due nor impaired have beenrenegotiated during the financial period/year.

Receivables that are past due but not impairedThe Group has trade receivables amounting to RM1,810,981 (2010: RM1,581,591) respectivelythat are past due at the reporting date but not impaired.

The management had assessed and concluded that those receivables are recoverable asthese accounts are still active.



16. TRADE AND OTHER RECEIVABLES (cont’d)

Receivables that are past due and impairedReceivables of the Company that are past due and impaired at the end of the reportingperiod are as follows:

Individually ImpairedGroup Company

Trade receivables 31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Trade receivables, gross 678,336 1,986,204 0 0Less: Impairment loss (678,336) (1,986,204) 0 0

0 0 0 0

Individually ImpairedGroup Company

Others receivables 31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Trade receivables, gross 140,459 140,459 16,354,904 16,768,874Less: Impairment loss (140,459) (140,459) (16,354,904) (16,768,874)

0 0 0 0

The reconciliation of movement in impairment losses are as follows:

Group CompanyTrade receivables 31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RM

At 1 January 2011/1 January 2010 1,986,204 5,197,831 0 0

Charge for the financialperiod/year 75,758 396,242 0 0

Written off (713,707) (3,626,444) 0 0Reversal of impairment loss (546,998) (1,140) 0 0Disposal of a subsidiary (122,921) 0 0 0Effect of exchange difference 0 19,715 0 0At 31 March 2012/

31 December 2010 678,336 1,986,204 0 0



16. TRADE AND OTHER RECEIVABLES (cont’d)Group Company

Others receivables 31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

At 1 January 2011/1 January 2010 140,459 1,346,315 16,768,874 33,768,874Charge for the financial period/year 0 12,852 0 0Written off 0 (1,218,708) 0 0Reversal of impairment loss 0 0 (413,970) (17,000,000)At 31 March 2012/

31 December 2010 140,459 140,459 16,354,904 16,768,874

Trade and other receivables that are individually determined to be impaired at the end of thereporting period relate to those debtors that exhibit significant financial difficulties and havedefaulted on payments. These receivables are not secured by any collateral or credit enhancements.

17. CASH AND CASH EQUIVALENTSGroup Company

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Cash and bank balances 3,099,459 4,917,747 32,757 32,544Deposits with licensed banks 1,469,115 821,190 650,000 0

4,568,574 5,738,937 682,757 32,544

(a) Included in the Group's cash and bank balances is an amount of RM1,149,160 (2010:RM2,935,529) held under the Housing Development Account pursuant to Section 7A of theHousing Development (Control and Licensing) Act, 1966, as amended by the HousingDevelopers (Housing Development Account) (Amendment) Regulations, 2002.

(b) Information on financial risk of cash and cash equivalents are disclosed in Note 40 to thefinancial statements.

(c) Included in the deposits with licensed banks is an amount of RM419,115 (2010: RM521,190)pledged as securities for banking facilities granted to a subsidiary.

(d) The currency exposure profile of cash and cash equivalents are as follows:

Group Company31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RM

Ringgit Malaysia 4,074,651 4,708,672 682,757 32,544United States Dollar 488,013 693,672 0 0Euro 2,473 282,064 0 0Hong Kong Dollar 2,289 1,517 0 0British Pound Sterling 315 356 0 0Chinese Renminbi 222 1,320 0 0Thai Baht 508 48 0 0Vietnamese Dong 103 51,196 0 0Singapore Dollar 0 92 0 0

4,568,574 5,738,937 682,757 32,544



17. CASH AND CASH EQUIVALENTS (cont’d)

(e) For the purpose of the statements of cash flows, cash and cash equivalents comprise thefollowing as at the end of the reporting period:

Group Company31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RMCash and bank balances 3,099,459 4,917,747 32,757 32,544Deposits with licensed banks 1,469,115 821,190 650,000 0Bank overdrafts included in

borrowings (Note 22) (53,326) (66,781) 0 0

4,515,248 5,672,156 682,757 32,544Cash and cash equivalents for

disposal group classifiedas held for sale (Note 18) 7,034 0 0 0

Less: Deposits pledged to licensed banks (419,115) (521,190) 0 0

4,103,167 5,150,966 682,757 32,544

18. DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE

(a) Certain properties of the Company, Emico Development Sdn. Bhd. ("EDSB") and Emico AsiaSdn. Bhd. ("EASB") are presented as non-current assets held for sale following the Group'scommitment to a plan on 8 February 2011 to dispose these assets and utilise the proceedsto redeem the outstanding RSLS. Efforts to sell the non-current assets have commenced andsales are expected by December 2012.

(b) Operasi Tembaga Sdn. Bhd., a 49.7% owned indirect subsidiary of the Company, had on 30May 2011 entered into a Conditional Sale of Shares Agreement with Langkawi CemerlangResort Sdn. Bhd. for the disposal of its 80% equity interest in PKB-Operasi Tembaga Sdn. Bhd.("PKB") for a total cash consideration of RM10million.

(c) As at 31 March 2012, the assets and liabilities classified as held for sale are as below:

Group CompanyRM RM

Assets of the Company classified as held for saleInvestment property (Note 8) 2,313,333 2,313,333

Assets of EASB classified as held for saleInvestment properties (Note 8) 1,387,561 0

3,700,894 2,313,333

Assets of EDSB classified as held for saleProperty development projects -

non-current assets (Note 13) 25,270,504 0

Assets of PKB classified as held for saleProperty, plant and equipment (Note 7) 342 0Property development costs- current assets (Note 13) 2,600,154 0Other receivables 101,698 0Cash and cash equivalents 7,034 0

2,709,228 0Tota assets of disposal group classified

as held for sale 31,680,626 2,313,333



18. DISPOSAL GROUP CLASSIFIED AS HELD FOR SALE (cont’d)

Group CompanyRM RM

Liabilities of PKB classified as held for saleTrade and other payables 298,534 0Current tax liabilities 1,200 0

299,734 0

Total liabilities of disposal group classified as held for sale 299,734 0

19. SHARE CAPITALGroup/Company

31.3.2012 31.12.2010RM RM

AuthorisedOrdinary shares of RM1 each 150,000,000 150,000,000

Issued and fully paidOrdinary shares of RM1 each 95,926,521 95,926,521

On 1 December 2003, 11,130,000 detachable warrants were granted by the Company to thesubscribers of the rights shares. The warrants may be exercised at any time after the issue datebut not later than 5.00 p.m. on 1 December 2013. Each warrant entitles its registered holder, atany time during the exercise period of the warrants, to subscribe for one new ordinary share. Theexercise price of each warrant is fixed at RM1 payable in cash for each new ordinary share of RM1each in the Company. As at 31 March 2012, none of the 11,130,000 warrants were exercised tosubscribe for new ordinary shares.

The owners of the parent are entitled to receive dividends as and when declared by the Companyand are entitled to one vote per ordinary share at meetings of the Company. All ordinary sharesrank pari passu with regard to the Company’s residual assets.

20. RESERVESGroup Company

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Non-distributable as cash dividends:Share premium 7,736,782 7,736,782 7,736,782 7,736,782Revaluation reserve 8,274,126 0 0 0Exchange translation reserve 0 (1,175,136) 0 0

16,010,908 6,561,646 7,736,782 7,736,782

(a) Revaluation reserve

Revaluation reserve represents the surplus arising on the revaluation of the Company'sleasehold land and building.



20. RESERVES (cont’d)

(b) Exchange translation reserve

The exchange translation reserve is used to record foreign currency exchange differencesarising from the translation of the financial statements of foreign operations whose functionalcurrencies are different from that of the Group’s presentation currency. It is also used torecord the exchange differences arising from monetary items which form part of the Group’snet investment in foreign operations, where the monetary item is denominated in either thefunctional currency of the reporting entity or the foreign operation.

21. REDEEMABLE SECURED LOAN STOCKS ("RSLS")

On 24 May 2004, the Company issued 840,001 units of 4% 5 year RSLS at nominal value of RM100per 4% RSLS at an issue price of RM81.31 to its Scheme Lenders pursuant to the Debt RestructuringScheme implemented.

The principal terms of the RSLS are as follows:

(i) Convertibility - the RSLS would be fully redeemed and not convertible into new shares ofthe Company;

(ii) The RSLS bear a fixed coupon rate of 6% (2010: 4%) per annum and is payable annually inarrears; and

(iii) The RSLS may be redeemable in part or in full at the option of the Company from the dateof issuance. Any RSLS not redeemed within one year from the date of issuance will beredeemed by the Company pro-rated among the holders of the RSLS as follows:

Redemption RedemptionAnniversary date Nominal value value price

RM RM RM per 4%RSLS

First 0 0 83.81Second 13,870,000 12,000,000 86.52Third 22,362,000 20,000,000 89.44Fourth 21,600,000 20,000,000 92.59Fifth 26,168,000 26,168,000 100.00

84,000,000 78,168,000

The RSLS is secured by certain property, plant and equipment and properties of subsidiaries (asdisclosed in Note 18) and all the shares held by the Company in NEB Development Berhad andMercu Tanah Langkawi Sdn. Bhd (Note 10).

The movements of the RSLS during the financial period/ year are as follows:

Group/Company31.3.2012 31.12.2010

RM RMBalance as at 1 January 2011/1 January 2010 33,146,600 35,711,600Redemption during the financial period/year 0 (2,565,000)Balance as at 31 March 2012/31 December 2010 33,146,600 33,146,600




21. REDEEMABLE SECURED LOAN STOCKS ("RSLS")(cont’d)

The holders of the RSLS have agreed to extend the maturity dates of the RSLS as follows:

RMBy 31 July 2012 8,500,000By 31 December 2012 24,646,600

The Company will be seeking the approval of the holders of the RSLS to extend the maturity dateof the tranche due on 31 July 2012 for a further extension to 30 November 2012.

22. BORROWINGSGroup

31.3.2012 31.12.2010RM RM

Current liabilitiesSecured:Bank overdrafts (Note 23) 53,326 66,781Trust receipts (Note 24) 914,198 919,612Hire purchase payables (Note 26) 146,432 134,156Term loans (Note 25) 0 206,050Other borrowings 0 680,486

1,113,956 2,007,085Non-current liabilitiesSecured:Hire purchase payables (Note 26) 272,254 142,507Term loans (Note 25) 0 34,293

272,254 176,800Total borrowingsBank overdrafts (Note 23) 53,326 66,781Trust receipts (Note 24) 914,198 919,612Hire purchase payables (Note 26) 418,686 276,663Term loans (Note 25) 0 240,343Other borrowings 0 680,486

1,386,210 2,183,885

(a) The currency exposure profile of borrowings is as follows:Group

31.3.2012 31.12.2010RM RM

Ringgit Malaysia 1,386,210 1,263,056Vietnamese Dong 0 920,829

1,386,210 2,183,885


23. BANK OVERDRAFTS

The bank overdrafts of the Group are secured over by:

(a) a charge on the fixed deposits of RM312,630 (2010: RM284,485); and

(b) a corporate guarantee by the Company.

Information on financial risks of borrowings is disclosed in Note 40 to the financial statements.

24. TRUST RECEIPTS

The trust receipts of the Group are secured over by:

(a) a charge on the fixed deposits of RM312,630 (2010: RM284,485); and

(b) charges over certain or entire assets of the subsidiaries (Note 7); and

(c) corporate guarantee by the Company.

Information on financial risks of borrowings is disclosed in Note 40 to the financial statements.

25. TERM LOANS

The term loans of the Group are secured over by a charge on the assets of a subsidiary.

Information on financial risks of borrowings and its remaining maturity is disclosed in Note 40to the financial statements.

26. HIRE PURCHASE PAYABLESGroup

31.3.2012 31.12.2010RM RM

Minimum hire purchase payments:- not later than one (1) year 171,456 143,951- later than one (1) year but not later than five (5) years 301,792 149,039Total minimum hire purchase payments 473,248 292,990Less: Future interest charges (54,562) (16,327)

Present value of hire purchase payments 418,686 276,663

Repayable as follows:

Current liabilities:- not later than one (1) year 146,432 134,156

Non-current liabilities:- later than one (1) year and not later than five (5) years 272,254 142,507

418,686 276,663

Information on financial risks of hire purchase is disclosed in Note 40 to the financial statements.





27. TRADE AND OTHER PAYABLESGroup Company

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Current

Trade payablesThird parties 8,502,624 11,007,619 0 0Progress billing in respect of

property development costs 0 278,516 0 0

8,502,624 11,286,135 0 0

Other payablesAmount owing to subsidiary

companies 0 0 11,088,430 9,568,012Amount owing to Directors 0 222,100 0 0Amount owing to related parties 337,314 5,323,231 0 207,879Other payables 3,149,724 5,008,504 6,715 614,118Deposit received 997,133 32,420 0 0Accruals 4,936,018 6,208,316 2,044,567 1,395,087

9,420,189 16,794,571 13,139,712 11,785,096

17,922,813 28,080,706 13,139,712 11,785,096

(a) Trade payables comprise amounts outstanding for trade purchases and construction relatedcosts. The amount is non-interest bearing and normal trade credit terms granted to the Groupranges from 30 to 150 days (2010: 30 to 150 days).

(b) Amount owing to subsidiaries and related parties are unsecured, interest-free and are payableupon demand in cash and cash equivalents.

The related parties are companies in which certain Directors of the Group and their familymembers have significant financial and controlling interests.

(c) The amount owing to Directors is in respect of advances received , which are unsecured,interest-free and is payable upon demand in cash and cash equivalents.

(d) Information on financial risks of trade and other payables are disclosed in Note 40 to thefinancial statements

(e) The currency exposure profile of payables is as follows:Group Company

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Ringgit Malaysia 17,364,897 25,274,809 13,139,712 11,785,096United States Dollar 477,334 172,040 0 0Chinese Renminbi 66,474 5,122 0 0British Pound Sterling 182 0 0 0Vietnamese Dong 0 2,496,661 0 0Euro 0 75 0 0Japanese Yen 0 7,701 0 0Hong Kong Dollar 13,926 124,298 0 0

17,922,813 28,080,706 13,139,712 11,785,096



28. CONTINGENT LIABILITYCompany

31.3.2012 31.12.2010RM RM

Corporate guarantee extended to local banks and creditorsfor credit facility granted to and utilised by the subsidiaries 1,416,498 1,608,000

The Directors are of the view that the chances of the financial institutions to call upon the corporateguarantees are remote.

29. REVENUEGroup Company

1.1.2011 1.1.2010 1.1.2011 1.1.2010to to to to

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Sales of goods 76,571,624 53,054,380 0 0Property development revenue 10,820,338 11,518,980 0 0Chroming services rendered 110,704 156,441 0 0Management services rendered 0 0 300,000 240,000

87,502,666 64,729,801 300,000 240,000

30. OTHER INCOMEGroup Company

1.1.2011 1.1.2010 1.1.2011 1.1.2010to to to to

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Interest income:- Loans and receivables 0 9,987 0 0- House buyer 34,852 125,372 0 0- Financial institutions 85,212 83,579 129 276Deposits refunded 471 5,573 0 0Compensation received 75,127 700 0 0Forfeiture income 43,270 188,950 0 0Gain on disposal of investment

property and prepaid leasehold land 0 2,816,173 0 0Gain on disposal of property, plant

and equipment 269,993 45,997 0 0Gain on disposal of investment

in a subsidiary 1,006,872 0 0 0Insurance claim 800 11,555 800 0Other income 87,659 34,601 0 0Overprovision of accrued expense 0 10,400 0 0Realised gain on foreign exchange 140,386 122,128 0 0Rental received from- machinery 120,000 138,000 0 0- premises 150,000 275,936 0 0Reversal of impairment loss on trade and other receivables (Note 16) 546,998 1,140 413,970 17,000,000Unrealised gain on foreign exchange 234,086 0 0 0

2,795,726 3,870,091 414,899 17,000,276



31. EMPLOYEE BENEFITS EXPENSEGroup Company

1.1.2011 1.1.2010 1.1.2011 1.1.2010to to to to

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Wages, salaries, overtime andbonuses 8,214,005 5,990,032 413,750 243,750

Contributions to definedprovident fund 616,205 400,599 37,320 17,640

Social security contributions 76,618 48,608 598 398Other benefits 564,269 421,316 0 0

9,471,097 6,860,555 451,668 261,788

Included in employee benefits expense are Directors' remuneration as follows:

Group Company1.1.2011 1.1.2010 1.1.2011 1.1.2010

to to to to 31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RMExecutive Directors of the Company:Fee 37,500 30,000 37,500 30,000Contributions to employees'

provident fund 97,620 58,680 37,320 17,640Other emoluments 830,670 493,145 301,098 147,398

Non-executive Directors of theCompany:

Fee 37,500 27,000 37,500 27,000Other emoluments 14,250 15,750 14,250 15,750

Executive Directors of thesubsidiaries:

Contributions to employees'provident fund 23,420 15,156 0 0

Other emoluments 183,922 127,097 0 0

1,224,882 766,828 427,668 237,788

32. FINANCE COSTSGroup Company

1.1.2011 1.1.2010 1.1.2011 1.1.2010to to to to

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Interest expense on:- loan stock 2,483,278 1,412,160 2,483,278 1,412,160- borrowings 105,262 69,737 0 0- term loans 355,002 169,025 0 0- hire purchase 17,770 18,269 0 0- others 124,630 199,196 (31,944) 186,034

3,085,942 1,868,387 2,451,334 1,598,194



33. (LOSS)/PROFIT BEFORE TAX

Group Company1.1.2011 1.1.2010 1.1.2011 1.1.2010

to to to to31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RM(Loss)/Profit before tax is arrived at after charging:

Audit fee- current year 100,400 98,336 25,000 23,000Depreciation of property, plant and equipment (Note 7) 2,640,557 2,147,852 0 0Amortisation of investment properties (Note 8) 8,125 28,152 0 0Developed properties

written down 1,001,526 0 0 0Impairment losses on:- trade and other

receivables (Note 16) 75,758 409,094 0 0- investment properties (Note 8) 486,667 0 486,667 0- investment in subsidiaries (Note 10) 0 0 1,600,485 0- land held for property

development (Note 13) 742,555 0 0 0Loss on foreign exchange- unrealised 57,124 174,076 0 0- realised 105,926 194,521 0 0Loss on disposal of property,

plant and equipment 0 99,946 0 0Loss on disposal of investment

in a subsidiary 0 0 1,227,764 0Loss on disposal of investment

in an associate 306,934 0 0 0Property, plant and equipment

written off (Note 7) 6,425 3,741 0 0Rental of:- premises 483,876 340,050 0 0- equipment 2,894 7,344 0 0- server space 2,080 2,400 0 0- machinery 3,690 2,760 0 0



34. TAX EXPENSEGroup Company

1.1.2011 1.1.2010 1.1.2011 1.1.2010to to to to

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Current tax expense based on profit for the financial period/year 143,600 30,400 0 0(Over)/Underprovision of tax in prior years (7,984) 154,051 0 0

135,616 184,451 0 0Deferred tax expense (Note 14):- relating to origination and

reversal of temporary differences 4,800 51,500 0 0

- under/(over)provision in prior years 91,362 (76,200) 0 0

- crystallisation of deferred tax liability on revaluation surplus (14,936) (36,688) 0 0

81,226 (61,388) 0 0216,842 123,063 0 0

The Malaysian income tax is calculated at the statutory tax rate of 25% (2010: 25%) of the estimatedtaxable profits for the fiscal year.

The numerical reconciliation between the tax expense and the product of accounting (loss)/profitmultiplied by the applicable tax rates of the Group and of the Company are as follows:

Group Company1.1.2011 1.1.2010 1.1.2011 1.1.2010

to to to to31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RMReconciliation of tax expense and

accounting (loss)/profit:Accounting (loss)/profit before tax (1,534,399) 1,327,894 (5,903,504) 14,854,688

Tax at the applicable tax rate of 25% (383,600) 332,000 (1,475,900) 3,713,700Tax effect of :- expenses not deductible for

tax purpose 1,378,700 5,075,600 1,513,000 555,300- income not subject to tax (232,000) (4,970,700) (103,300) (4,250,000)- different tax rate 0 (1,200) 0 0Permanent loss not recognised

during the financial year 8,400 88,400 0 0Utilisation of deferred tax assets

not recognised in prior year (689,300) (442,200) 0 (19,000)Unused tax losses not recognised

during the financial period 66,200 0 66,200 0(Over)/Underprovision of tax

in prior years (7,984) 154,051 0 0Under/(Over)provision of

deferred tax in prior years 91,362 (76,200) 0 0Annual crystallisation of deferred

tax on revaluation surplus (14,936) (36,688) 0 0Tax expense for the financial

period/year 216,842 123,063 0 0



34. TAX EXPENSE (cont’d)

Tax savings of the Group and the Company are as follows:

Group Company1.1.2011 1.1.2010 1.1.2011 1.1.2010

to to to to31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RM

Arising from utilisation of previouslyunrecognised tax losses 654,400 468,500 0 0

35. EARNINGS PER SHARE

(a) Basic

Basic earnings per ordinary share for the financial period/year is calculated by dividing theprofit for the financial period/year attributable to equity holders of the parent by the weightedaverage number of ordinary shares outstanding during the financial period/year.

Group1.1.2011 1.1.2010

to to31.3.2012 31.12.2010

RM RM(Loss)/Profit attributable to equity holders

of the parent (1,970,146) 1,053,856

Weighted average number of ordinaryshares in issue (units) 95,926,521 95,926,521

Basic (loss)/earnings per share (sen) (2.05) 1.10

(b) Diluted

Diluted earnings per ordinary share is not applicable and not presented because there areno dilutive potential ordinary shares to be issued.

36. RELATED PARTY DISCLOSURES

(a) Identities of related parties

Parties are considered to be related to the Group if the Group has the ability, directly orindirectly, to control the party or exercise significant influence over the party in makingfinancial and operating decisions, or vice versa, or where the Group and the party are subjectto common control or common significant influence. Related parties may be individuals orother parties.

The Company has controlling related party relationship with its direct and indirect subsidiaries.



36. RELATED PARTY DISCLOSURES (cont’d)

(b) In addition to the transaction and balances detailed elsewhere in the financial statements,the Group and the Company had the following transactions with related parties during thefinancial period/year:

Group Company1.1.2011 1.1.2010 1.1.2011 1.1.2010

to to to to31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RMWith subsidiaries:Management fee received- Emico Development Sdn. Bhd. 0 0 150,000 120,000- Emico Asia Sdn. Bhd. 0 0 150,000 120,000

With other related partiesPurchases:- Century Plas Industries Sdn. Bhd. 11,129,086 7,043,266 0 0- U-Can Marketing Sdn. Bhd. 0 143,860 0 0

Sales:- Century Plas Industries Sdn. Bhd. 7,412,425 4,643,014 0 0- U-Can Marketing Sdn. Bhd. 134,887 2,223 0 0

Rental of machinery received:- Century Plas Industries Sdn. Bhd. 120,000 138,000 0 0

Rental of premises received:- Century Plas Industries Sdn. Bhd. 150,000 120,000 0 0

Rental of premises paid and payable:- Beng Choo Marketing Sdn. Bhd. 405,000 324,000 0 0

Project coordination & supervision charges paid:

- Emiglow Ventures (M) Sdn. Bhd. 0 60,000 0 0

Rental paid and payable:- Mr. Tan Chin Peng, a Director of a

subsidiary 0 13,316 0 0

The related party transactions described above were carried out on terms and conditions notmaterially different from those obtainable from transactions with unrelated parties.

The related parties are companies in which certain Directors of the Group and their familymembers have significant financial and controlling interests.

Information regarding outstanding balances arising from related party transactions as at 31 March2012 are disclosed in Note 16 and 27 to the financial statements.



36. RELATED PARTY DISCLOSURES (cont’d)

(c) Compensation of key management personnel

Key management personnel are those persons having the authority and responsibility forplanning, directing and controlling the activities of the entity, directly and indirectly, includingany director (whether executive or otherwise) of the Group.

Group Company1.1.2011 1.1.2010 1.1.2011 1.1.2010

to to to t o31.3.2012 31.12.2010 31.3.2012 31.12.2010

RM RM RM RM

Short term employee benefits 1,103,842 692,992 390,348 220,148Contributions to defined

contribution plans 121,040 73,836 37,320 17,640

1,224,882 766,828 427,668 237,788

Estimated cash value ofbenefits-in-kind provided to Directors 17,400 34,525 0 0

37. OPERATING LEASE ARRANGEMENTS

The Group had entered into an operating lease agreement for the use of land and premises fora lease term of 44 years.

The future aggregate minimum lease payments under operating leases contracted for as atreporting date but not recognised as liabilities were as follows:

Group31.12.2010

RM

Not later than 1 year 97,960Later than 1 year but not later than 5 years 391,838Later than 5 years 2,963,277

3,453,075



38. OPERATING SEGMENTS

Emico Holdings Berhad is principally involved in investment holding and its subsidiaries areprincipally engaged in manufacturing and trading of consumable products and propertydevelopment.

Emico Holdings Berhad has arrived at three (3) reportable segments that are organised andmanaged separately according to the nature of products and services, specific expertise andtechnologies requirements, which requires different business and marketing strategies. Thereportable segments are summarised as follows:

(i) Investment holding(ii) Consumable products - Manufacturing and trading of consumable products(iii) Property development - Development of land into residential and commercial building.

The accounting policies of operating segments are the same as those described in the summaryof significant accounting policies.

Inter-segment revenue is priced along the same lines as sales to external customers and iseliminated in the consolidated financial statements. These policies have been applied consistentlythroughout the current and previous financial period/year.

Segment assets exclude tax assets.

Segment liabilities exclude tax liabilities and unallocated liabilities. Even though loans andborrowings arise from financing activities rather than operating activities, they are allocated tothe segments based on relevant factors (e.g. funding requirements). Details are provided in thereconciliations from segment assets and liabilities to the position of the Group.

(a) Business SegmentsConsumable Property Investment

products development holding GroupRM RM RM RM

1.1.2011 to 31.3.2012Revenue:Total revenue 88,877,799 13,488,378 300,000 102,666,177Inter-segment revenue (14,863,511) 0 (300,000) (15,163,511)Revenue from

external customers 74,014,288 13,488,378 0 87,502,666

Interest income 11,253 108,682 129 120,064Finance costs (559,114) (11,339) (2,451,334) (3,021,787)

Net finance expense (547,861) 97,343 (2,451,205) (2,901,723)

Depreciation and amortisation (2,440,514) (208,168) 0 (2,648,682)



38. OPERATING SEGMENTS (cont’d)

(a) Business Segments (cont’d)Consumable Property Investment

products development holding GroupRM RM RM RM

Segment profit/(loss) before income tax 4,930,498 (254,705) (6,210,192) (1,534,399)

Share of profit of associates 0 422,384 0 422,384

Tax expense (374) (216,468) 0 (216,842)

Other material non-cash itemsImpairment losses on:- Trade and other receivables 75,758 0 0 75,758- Investment properties 0 0 486,667 486,667- Land held for property

development 0 742,555 0 742,555Developed properties

written down 0 1,001,526 0 1,001,526Net loss on foreign exchange- Unrealised 57,124 0 0 57,124Segment assets 39,432,707 56,949,934 3,289,156 99,671,797

Segment liabilities 12,552,971 7,478,854 36,815,491 56,847,316

1.1.2010 to 31.12.2010Revenue:Total revenue 62,560,979 11,518,980 240,000 74,319,959Inter-segment revenue (9,350,158) 0 (240,000) (9,590,158)Revenue from

external customers 53,210,821 11,518,980 0 64,729,801

Interest income 20,354 198,308 276 218,938Finance costs (253,546) (16,647) (1,598,194) (1,868,387)Net finance expense (233,192) 181,661 (1,597,918) (1,649,449)

Depreciation and amortisation (1,931,767) (242,983) (1,254) (2,176,004)

Segment profit/(loss)before income tax 3,126,014 344,007 (2,142,127) 1,327,894

Share of profit of associates 0 180,123 0 180,123

Tax expense 74,407 (197,470) 0 (123,063)

Other material non-cash itemsImpairment losses on:- Trade receivables 396,242 0 0 396,242- Other receivables 12,852 0 0 12,852Gain on disposal of investment

property and leasehold land 2,816,173 0 0 2,816,173Net loss on foreign exchange- Unrealised 174,076 0 0 174,076

Segment assets 30,178,542 66,283,269 3,647,182 100,108,993

Segment liabilities 13,804,312 15,189,412 35,988,809 64,982,533


(a) Business Segments (cont’d)

Reconciliations of reportable segment revenues, profit or loss, assets and liabilities to theGroup’s corresponding amounts are as follows:

1.1.2011 1.1.2010to to

31.3.2012 31.12.2010RM RM

Revenue

Total revenue for reportable segments 102,666,177 74,319,959Elimination of inter-segment revenues (15,163,511) (9,590,158)Group's revenue per consolidated statement of

comprehensive income 87,502,666 64,729,801

1.1.2011 1.1.2010to to

31.3.2012 31.12.2010RM RM

Depreciation

Total depreciation and amortisation for reportable segments 2,648,682 2,176,004Depreciation and amortisation 2,648,682 2,176,004

1.1.2011 1.1.2010to to

31.3.2012 31.12.2010RM RM

Gain / (Loss) for the financial period/year

Gain / (Loss) before tax (1,534,399) 1,327,894Tax expenses (216,842) (123,063)

Gain / (Loss) for the financial period/year (1,751,241) 1,204,831







(b) Geographical Segments

The Group's manufacturing facilities and sales offices are mainly based in Malaysia.

In presenting information on the basis of geographical areas, segment revenue is based onthe geographical location from which the sale transactions originated.

Segment assets are based on the geographical location of the Group's assets. The non-currentassets do not include financial instruments and deferred tax assets.

1.1.2011 1.1.2010to to

31.3.2012 31.12.2010RM RM

Revenue from external customers

Malaysia 31,588,817 27,497,666Europe 48,908,476 31,449,172Other countries 7,005,373 5,782,963

87,502,666 64,729,801

31.3.2012 31.12.2010RM RM

Non-current assets

Malaysia 24,254,959 44,863,007Other Asian countries 0 2,878,959

24,254,959 47,741,966

Major customer

Revenue from major customers in the consumable products segment amounted toRM33,265,814 (2010: RM26,491,142) with revenue more than 10% of the Group's revenue.




39. FINANCIAL INSTRUMENTS

(a) Capital management

Our objectives and policies of managing capital are to safeguard the Group's ability tocontinue in its operations as going concerns in order to provide fair returns for shareholdersand to maintain an optimal capital structure to reduce the cost of capital. In order to maintainthe optimal capital structure, the Group may, from time to time, adjust/vary the dividendpayouts to shareholders, issue new shares, redeem debts or sell assets to reduce debts, wherenecessary.

For capital management purposes, the Group considers shareholders' equity and borrowingsto be the key components in the Group capital structure. The Group monitors capital on thebasis of gearing ratio. The Group include within net debt, borrowings less fixed deposits witha licensed bank and cash and bank balances. There were no changes in the Group's approachto capital management during the financial period. The debts-to-equity as at 31 March 2012and 31 December 2010 were as follows:

Group31.3.2012 31.12.2010

Note RM RM

Borrowings 22 1,386,210 2,183,885Total liabilities 1,386,210 2,183,885Less:

Cash and bank balances (3,099,459) (4,917,747)Fixed deposits with a licensed bank (1,469,115) (821,190)

Net debt (3,182,364) (3,555,052)

Total capital 34,299,925 26,820,809Net debt (3,182,364) (3,555,052)

Equity 31,117,561 23,265,757

Gearing ratio * *

* Capital gearing ratio is not presented as the Company is in net cash position as at 31March 2012 and 31 December 2010.



39. FINANCIAL INSTRUMENTS (cont’d)

(b) Categories of financial instruments

Loan and receivablesGroup Company

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Financial assetsTrade and other receivables

(excluding deposits andprepayment) 13,337,178 11,737,499 39,409,169 41,473,354

Cash and cash equivalents 4,568,574 5,738,937 682,757 32,544

17,905,752 17,476,436 40,091,926 41,505,898

Other financial liabilitiesGroup Company

31.3.2012 31.12.2010 31.3.2012 31.12.2010RM RM RM RM

Financial liabilities Trade and other payables 17,922,813 28,080,706 13,139,712 11,785,096Redeemable secured

loan stocks 33,146,600 33,146,600 33,146,600 33,146,600Borrowings 1,386,210 2,183,885 0 0

52,455,623 63,411,191 46,286,312 44,931,696

(c) Fair values of financial instruments

The fair values of financial instruments that are not carried at fair value and whose carryingamounts do not approximate its fair values are as follows

GroupCarrying Fairamount value

31.3.2012 RM RM

Recognised

Financial liabilitiesHire purchase 418,686 409,078

GroupCarrying Fairamount value

31.12.2010 RM RM

Recognised

Financial liabilitiesHire purchase 276,663 270,115



39. FINANCIAL INSTRUMENTS (cont’d)

(d) Methods and assumptions used to estimate fair value

The fair values of financial assets and financial liabilities are determined as follows:

(i) Financial instruments that are not carried at fair value and whose carrying amounts area reasonable approximation of fair value

The carrying amounts of financial assets and liabilities, such as trade and other receivables,trade and other payables and borrowings, are reasonable approximation of fair value,either due to their short-term nature or that they are floating rate instruments that arere-priced to market interest rates on or near the end of the reporting period.

The carrying amounts of the current position of borrowings are reasonable approximationsof fair values due to the significant impact of discounting.

(ii) Hire purchase

The fair value of this financial instrument is estimated by discounting expected futurecash flows at market incremental lending rate for similar types of lending, borrowingsor leasing arrangements at the end of the reporting period.

40. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

The Group’s financial risk management objective is to optimise value creation for shareholderswhilst minimising the potential adverse impact arising from fluctuations in foreign currencyexchange and the unpredictability of the financial markets.

The Group operates within an established risk management framework and clearly definedguidelines that are regularly reviewed by the Board of Directors and does not trade in derivativefinancial instruments. Financial risk management is carried out through risk review programmes,internal control systems, insurance programmes and adherence to the Group financial riskmanagement policies. The Group is exposed mainly to foreign currency risk, interest rate risk,liquidity and cash flow risk and credit risk. Information on the management of the relatedexposures is detailed below.

(i) Credit risk

Cash deposits and trade receivables may give rise to credit risk which requires the loss to berecognised if a counter party fails to perform as contracted. The counter parties are majorinternational institutions and reputable multinational organisations. It is the Company’s policyto monitor the financial standing of these counter parties on an ongoing basis to ensure that theCompany is exposed to minimal credit risk

The Group’s primary exposure to credit risk arises through its trade receivables. The Group’strading terms with its customers are mainly on credit, except for new customers, where depositsin advance are normally required. The credit period is generally range from one (1) month to four(4) months for major customers. Each customer has a maximum credit limit and the Group seeksto maintain strict control over its outstanding receivables via credit control to minimise creditrisk. Overdue balances are reviewed regularly by senior management.

Exposure to credit risk

At the end of the reporting date, the Group's maximum exposure to credit risk is represented bythe carrying amount of each class of financial assets recognised in the statement of financialposition.



40. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (cont’d)

(i) Credit risk (cont’d)

Credit risk concentration profile

The Group determines concentration of credit risk by monitoring the country profiles of itstrade receivables on an ongoing basis. The credit risk concentration profile of the Group’strade receivables at the end of the reporting period is as follows:

31.3.2012 31.12.2010RM % of total RM % of total

By country:Germany 137,254 1% 0 0%Italy 156,628 1% 202,237 2%Malaysia 5,834,715 56% 6,004,394 64%Sweden 2,765,300 26% (221,967) (3%)United Kingdom 989,140 10% 2,047,150 22%United States Of America 257,524 2% 13,036 0%Vietnam 465,907 5% 1,089,608 12%Others (69,835) (1%) 313,547 3%

10,536,633 100% 9,448,005 100%

At the end of the reporting period, approximately:

32% (2010: 30%) of the Group’s trade receivables were due from major customers who aremulti-industry conglomerates located in Sweden, United Kingdom and Malaysia.

9% (2010: 5%) of the Group’s trade receivables were due from related party.

Financial assets that are neither past due nor impaired

Information regarding trade and other receivables that are neither past due nor impaired isdisclosed in Note 16 to the financial statements. Deposits with licensed banks and otherfinancial institutions that are neither past due nor impaired are placed with or entered intowith reputable financial institutions with high credit ratings and no history of default.

Financial assets that are either past due or impaired

Information regarding financial assets that are either past due or impaired is disclosed inNote 16 to the financial statements.

(ii) Liquidity and cash flow risk

The Group actively manages its debt maturity profile, operating cash flows and the availabilityof funding so as to ensure that all operating, investing and financing needs are met. Inliquidity risk management strategy, the Group measures and forecasts its cash commitmentsand maintains a level of cash and cash equivalents deemed adequate to finance the Group’sactivities. In addition, the Group strives to maintain available banking facilities at a reasonablelevel to meet its business needs.




(ii) Liquidity and cash flow risk (cont’d)

The table below summarises the maturity profile of the Group's and the Company's liabilitiesat the reporting date based on contractual undiscounted repayment obligations.

On demand or One to Overwithin one year five years five years Total

RM RM RM RMAs at 31 March 2012

Group

Financial liabilities:Trade and other payables 17,922,813 0 0 17,922,813Redeemable secured loan stocks 33,146,600 0 0 33,146,600Borrowings 1,138,980 301,792 0 1,440,772Total undiscounted financial

liabilities 52,208,393 301,792 0 52,510,185

Company

Financial liability:Trade and other payables 13,139,712 0 0 13,139,712Total undiscounted financial

liability 13,139,712 0 0 13,139,712

On demand or One to Overwithin one year five years five years Total

RM RM RM RMAs at 31 December 2010

Group

Financial liabilities:Trade and other payables 28,080,706 0 0 28,080,706Redeemable secured loan stocks 33,146,600 0 0 33,146,600Borrowings 2,034,846 149,039 0 2,183,885Total undiscounted financial

liabilities 63,262,152 149,039 0 63,411,191

Company

Financial liability:Trade and other payables 11,785,096 0 0 11,785,096Total undiscounted financial

liability 11,785,096 0 0 11,785,096




(iii) Interest rate risk

Interest rate risk is the risk that the fair value or future cash flows of the Group’s financialinstruments will fluctuate because of changes in market interest rates.

The Group's income and operating cash flows are substantially independent of changes inmarket interest rates. Interest rate exposure arises from the Group's borrowings is managedthrough the use of fixed and floating rates debts. The Group monitors the interest rates onborrowings closely to ensure that the borrowings are maintained at favourable rates. TheGroup does not use derivative financial instruments to hedge this risk.

Sensitivity analysis for interest rate risk

As at 31 March 2012, if interest rates at the date had been 50 basis points lower with all othervariables held constant, post-tax loss for the financial period would have been RM79,462(2010: RM79,293) lower, arising mainly as a result of lower interest expense on variableborrowings. If interest rates had been 50 basis points higher, with all other variables heldconstant, post-tax loss would have been RM79,462 (2010: RM79,293) higher, arising mainlyas a result of higher interest expense on variable borrowings. Profit is more sensitive tointerest rate decreases than increases because of borrowings with capped interest rates. Thesensitivity is higher in 2012 than in 2010 because of an increase in outstanding borrowingsthat has occurred. The assumed movement in basis points for interest rate sensitivity analysisis based on the currently observable market environment.



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(iv) Foreign currency risk

Foreign currency risk is the risk that the fair value or future cash flows of a financial instrumentwill fluctuate because of changes in foreign exchange rates.

The Group also hold cash and cash equivalents denominated in foreign currencies for workingcapital purposes. At the end of the reporting period, such foreign currency balances (inUnited States Dollar, Euro, Hong Kong Dollar, Sterling Pound, Chinese Renminbi, Thai Baht,Vietnamese Dong and Singapore Dollar) amounted to RM316,067 (2010: RM67,539) for theGroup.

Transactional currency exposures arise from sales and purchases that are denominated incurrency other than Ringgit Malaysia. The currency giving rise to this risk is primarily UnitedStates Dollar. The Group has no hedging policy and does not make use of forward-currencycontracts.

Sensitivity analysis for foreign currency risk

The following table demonstrates the sensitivity of the Group's (loss)/profit net of tax toreasonable possible change in the United States Dollar, Euro, Vietnamese Dong, and HongKong Dollar exchange rate against the respective functional currency of the Group entities,with all other variables held constant.

GroupLoss/(Profit) net of tax

1.1.2011 1.1.2010to to

31.3.2012 31.12.2010RM RM

USD/RM - Strengthened 5% -175,960 -136,405- Weakened 5% +175,960 +136,405

EURO/RM - Strengthened 5% -3,816 -10,592- Weakened 5% +3,816 +10,592

Vietnamese Dong/RM - Strengthened 5% -4 +59,706- Weakened 5% +4 -59,706

Hong Kong Dollar/RM - Strengthened 5% +436 +4,604- Weakened 5% -436 -4,604



41. SIGNIFICANT EVENTS DURING THE FINANCIAL PERIOD

(a) On 22 December 2011, the NEB Development Berhad, a 60% owned subsidiary of theCompany, had disposed of 34.84% equity interest of an associate, Quanzhou Fuji-SinoElevators Co. Ltd. at a total consideration of RM1,800,000.

(b) On 6 March 2012, the Company had disposed of its wholly owned subsidiary, Emico (Vietnam)Co. Ltd., for a cash consideration of RM800,000.

(c) Operasi Tembaga Sdn. Bhd., a 49.7% owned indirect subsidiary of the Company, had on 30May 2011 entered into a Conditional Sale of Shares Agreement with Langkawi CemerlangResort Sdn. Bhd. for the disposal of its 80% equity interest in PKB-Operasi Tembaga Sdn. Bhd.for a total a cash consideration of RM10 million.

42. COMPARATIVE FIGURES

Certain comparative figures have been reclassified to conform with current financial period'spresentation.

As previously Effect ofstated changes As restated

RM RM RM

Statements of financial positionTrade and other receivables 12,964,887 (417,724) 12,547,163Trade and other payables 28,498,430 (417,724) 28,080,706

Statements of cash flowsDecrease in trade and other receivables 1,493,017 417,724 1,910,741Increase in trade and other payables (16,138) (417,724) (433,862)

43. SUPPLEMENTARY INFORMATION ON REALISED AND UNREALISED LOSSES

The accumulated losses as at the end of the reporting period may be analysed as follows:

31.3.2012Group Company

RM RMTotal accumulated losses of Emico Holdings Berhad and its subsidiaries- Realised (90,271,245) (82,201,208)- Unrealised (3,079,548) 0

(93,350,793) (82,201,208)Total share of accumulated losses from associates- Realised (1,020,000) 0

(94,370,793) (82,201,208)

Add: Consolidation adjustments 16,733,290 0

Total group/company accumulated losses as per consolidated accounts (77,637,503) (82,201,208)

Authorised Share Capital : RM150,000,000Issued and Fully Paid Up Capital : RM95,926,521Class of Shares : Ordinary shares of RM1 eachVoting Rights : One vote per share

DISTRIBUTION OF SHAREHOLDINGSNo. of Shares Held No. of Shareholders

Size of Holdings Quantity % Number %

1 To 99 739 - 21 0.55100 To 1,000 750,871 0.78 824 21.751,001 To 10,000 8,986,033 9.37 1,790 47.2410,001 To 100,000 37,558,477 39.15 1,043 27.53100,001 To 4,796,325 (*) 48,630,401 50.70 111 2.934,796,326 AND ABOVE (**) - - - -Total 95,926,521 100.00 3,789 100.00

REMARK: * Less than 5% of issued shares** 5% or more of issued shares

SUBSTANTIAL SHAREHOLDERSNo. of Shares Held

Name Direct % Indirect %

1. Lim Teik Hian 52,000 0.06 21,550,642 # 22.47 2. Lim Teck Chye 1,211,630 1.27 20,391,012 # 21.26 3. Lim Poh Leng 2,027,700 2.12 19,574,942 # 20.41 4. Lim Poh Hoon 112,000 0.12 21,490,642 # 22.41

Note : # By virtue of their beneficial interest in the shares held by Mercsec Nominees (Tempatan) Sdn. Bhd., HDM Nominees

(Tempatan) Sdn. Bhd., PM Nominees (Tempatan) Sdn. Bhd., Alliancegroup Nominees (Tempatan)Sdn. Bhd.,CIMSECNominees (Tempatan) Sdn. Bhd., AIBB Nominees (Tempatan) Sdn. Bhd.and Beng Choo Marketing Sdn. Bhd. forthe substantial shareholders listed above. In addition it includes the deemed interest via their family membersLim Teik Hian (brother), Lim Poh Hoon (sister), Lim Teck Chye (brother) and Lim Poh Leng (sister).

DIRECTORS' SHAREHOLDINGS No. of Shares Held

Name Direct % Indirect %

1. Lim Teik Hian 52,000 0.06 21,550,642 # 22.47 2. Lim Teck Chye 1,211,630 1.27 20,391,012 # 21.26 3. Wong Sew Yun 895,859 0.94 - -

ANALYSIS OF SHAREHOLDINGS


AS AT 31 JULY 2012

ANALYSIS OF SHAREHOLDINGS


AS AT 31 JULY 2012

DISTRIBUTION OF WARRANTSNo. of Warrants Held No. of Warrantholders

Size of Holdings Quantity % Number %

1 To 99 2,084 0.02 46 4.25100 To 1,000 350,722 3.15 498 45.981,001 To 10,000 1,382,126 12.42 352 32.5010,001 To 100,000 6,278,280 56.41 174 16.07100,001 To 556,499 (*) 2,116,788 19.02 12 1.11556,499 AND ABOVE (**) 1,000,000 8.98 1 0.09Total 11,130,000 100.00 1 ,083 100.00

REMARK: * Less than 5% of issued warrants** 5% or more of issued warrants

SUBSTANTIAL WARRANTHOLDERS No. of Warrants Held

Name Direct %1. Seng Soon Pang 1,000,000 8.98

DIRECTORS' WARRANTHOLDINGS No. of Warrants Held

Name Direct % Indirect %1. Wong Sew Yun 263,488 2.37 - -2. Lim Teik Hian 13,000 0.12 - -

LIST OF TOP 30 SHAREHOLDERS


AS AT 31 JULY 2012

(Without Aggregating Securities from Different Securities Accounts Belonging to the Same Person)

Name No. of Shares Percentage

1. PM Nominees (Tempatan) Sdn Bhd 4,683,300 4.88- Pledged Securities Account for Lim Teck Chye

2. AIBB Nominees (Tempatan) Sdn Bhd 4,066,800 4.24- Pledged Securities Account for Lim Poh Leng

3. Alliancegroup Nominees (Tempatan) Sdn Bhd 2,630,000 2.74- Pledged Securities Account for Lim Teck Chye

4. CIMSEC Nominees (Tempatan) Sdn Bhd 1,997,000 2.08CIMB Bank for Lim Poh Leng

5. Beng Choo Marketing Sdn Bhd 1,964,212 2.056. Lim Poh Leng 1,955,700 2.047. RHB Nominees (Tempatan) Sdn Bhd 1,900,000 1.98

- Pledged Securities Account for Pang Lan Yin8. CIMSEC Nominees (Tempatan) Sdn Bhd 1,300,000 1.36

CIMB Bank for Ng Wai Leng9. Lim Teck Chye 1,211,630 1.2610. TA Nominees (Tempatan) Sdn Bhd 1,120,000 1.17

- Pledged Securities Account for Lee Chee Ming11. Wan Iskandar Bin Wan Sulaiman 900,000 0.9412. Wong Sew Yun 895,859 0.9313. HDM Nominees (Tempatan) Sdn Bhd 850,900 0.89

- Pledged Securities Account for Lim Poh Leng14. Public Nominees (Asing) Sdn Bhd 800,000 0.83

- Pledged Securities Account for Ong Soom Peng15. Mercsec Nominees (Tempatan) Sdn Bhd 692,600 0.72

- Pledged Securities Account for Beng Choo Marketing Sdn Bhd16. HDM Nominees (Tempatan) Sdn Bhd 684,000 0.71

- Pledged Securities Account for Lim Teck Chye17. Teoh Soon Lee 530,000 0.5518. Mercury Industries Berhad 510,000 0.5319. Chu Yoke Fong 500,000 0.5220. Hupson (B'worth) Sdn Bhd 500,000 0.5221. Maybank Securities Nominees (Asing) Sdn Bhd 500,000 0.52

Maybank Kim Eng Securities Pte Ltd for Kwek Keng Seng22. Pang Lan Yin 500,000 0.5223. Tan May Ching 463,100 0.4824. Pang Khip Kwek 450,000 0.4725. Yeo Eck Liong 450,000 0.4726. Beng Choo Marketing Sdn Bhd 437,000 0.4627. Neoh Gim Swee 410,000 0.4328. Abu Hassan bin Hashim 400,000 0.4229. Tham Ah Lan 369,700 0.3930. Bank Perusahaan Kecil & Sederhana Malaysia Berhad 361,200 0.38

Total 34,033,001 35.48

LIST OF TOP 30 WARRANTHOLDERS


AS AT 31 JULY 2012

(Without Aggregating Securities from Different Securities Accounts Belonging to the Same Person)

Name No. of Shares Percentage

1. Seng Soon Pang 1,000,000 8.982. Wong Sew Yun 263,488 2.373. Surash Kumar A/L Pursumal 254,900 2.294. MIDF Amanah Investment Nominees (Tempatan) Sdn Bhd 215,000 1.93

- Pledged Securities Account for AB Ghani bin Haji Mahmood5. Surash Kumar A/L Pursumal 200,000 1.806. Mohandas Vikyomal Lakhiani 185,000 1.667. JF Apex Nominees (Tempatan) Sdn Bhd 180,000 1.62

- Pledged Securities Account for AB Ghani bin Haji Mahmood8. Yap Poh Choon 158,000 1.429. Surash Kumar A/L Pursumal 150,000 1.3510. Tan Toh Thai 150,000 1.3511. CIMSEC Nominees (Tempatan) Sdn Bhd 145,000 1.30

CIMB Bank for Ng Wai Leng12. Lim Chong Siang 110,000 0.9913. Soo Lai Yin 105,400 0.9514. Alliancegroup Nominees (Tempatan) Sdn Bhd 100,000 0.90

- Pledged Securities Account for Liau Yong Hwa15. Bua Lee Eing 100,000 0.9016. CIMSEC Nominees (Tempatan) Sdn Bhd 100,000 0.90

- Pledged Securities Account for Roslan bin Fadzil17. Khor Hee Kiang 100,000 0.9018. Yashran Rezal bin Rafeal 100,000 0.9019. Rodzali bin Din 99,900 0.9020. New Tee 99,500 0.8921. SJ SEC Nominees (Tempatan) Sdn Bhd 99,000 0.89

- Pledged Securities Account for Lim Chee Keong22. Mercsec Nominees (Tempatan) Sdn Bhd 94,000 0.84

- Pledged Securities Account for Chan Li Li23. Chu Mun Len @ Chu Lee Sen 87,000 0.7824. CIMSEC Nominees (Tempatan) Sdn Bhd 80,000 0.72

CIMB Bank for Aljafri bin Wan Ahmad25. Low Teong Hwa 77,000 0.6926. Nik Ahmad Kamil bin Nik Yaacob 76,100 0.6827. Mercsec Nominees (Tempatan) Sdn Bhd 75,600 0.68

- Mercury Securities Sdn Bhd (IVT A)28. Lim Mooi Ngo 75,000 0.6729. CIMSEC Nominees (Tempatan) Sdn Bhd 70,000 0.63

- Pledged Securities Account for Tan Kok Jin30. Goh Gim Tiong 70,000 0.63

Total 4,619,888 41.51

LIST OF PROPERTIES


AS AT 31 MARCH 2012

Built-up Age of Net BookDescription/ Land Area Area Building Value Acquisition/

Location Tenure Existing Use (sq ft) (sq ft) (Years) RM'000 Revaluation *

Plot 18 & 19 Kawasan 60-years Land and 81,350 116,847 20 to 27 15,800 2012*Perindustrian Bayan Lepas, Leasehold factoryMukim 12 Daerah Barat Daya, Expiring 2046 buildings,Pulau Pinang and 2047 warehouse

respectively and office forindustrial use

Unit 2-5-9 99-years Office unit - 2,031 17 210 1992Harbour Trade Centre, Leasehold for rentalLebuh Macallum, Pulau Pinang Expiring 2089

Taman Batik, Sungai Petani, Freehold On-going mix 865,615 - - 2,649 1996Daerah Kuala Muda, Kedah development

project

HS(D) 773/97, PT 49753 Freehold On-going mix 2,621,798 - - 7,725 1996Mk Sungai Petani, developmentDaerah Kuala Muda, Kedah project

HS(D) 1/97, PT 48979 Freehold Vacant 154,118 - - 2,313 1997Mk Sungai Petani, commericalDaerah Kuala Muda, Kedah land for future

development

PT 296 to PT 432 99 years On-going mix 858,002 - - 1,757 1996Mukim Kuah, Leasehold developmentDaerah Langkawi, Kedah Expiring 2095 project

HS(D) 762/97, PT 49740 & Freehold Vacant 66,930 - - 1,388 2007HS(D) 763/97, PT 49741 commericalMk Sungai Petani, land for petrolDaerah Kuala Muda, Kedah station

Geran 127391 & 127392 Freehold 3 storey 2,800 7,394 4 846 2008Bandar Sungai Petani, office buildingDaerah Kuala Muda, Kedah


NOTICE IS HEREBY GIVEN that the Twentieth Annual General Meeting of the Company will be held at TheConference Room of Emico Holdings Berhad, 18 Lebuhraya Kampung Jawa, 11900 Bayan Lepas, Penang onThursday, 27 September 2012 at 11.00 a.m. for the following purposes :-

AGENDA

As Ordinary Business:1. To receive the Audited Financial Statements for the financial period from 1

January 2011 to 31 March 2012 together with the Reports of Directors andAuditors thereon.

2. To approve the payment of Directors' Fees for the financial period from 1 January2011 to 31 March 2012.

3. To re-elect the following Directors who retire by rotation in accordance withArticle 80 of the Company's Articles of Association and who, being eligible, offerthemselves for re-election:i. Mr. Wong Sew Yun ii. Mr. Wong Thai Sun

4. To re-appoint Messrs. BDO as Auditors of the Company until the next AnnualGeneral Meeting of the Company and to authorise the Directors to fix theirremuneration.

As Special Business :To consider and if thought fit, to pass with or without modifications the followingresolutions as Ordinary Resolutions:

5. AUTHORITY UNDER SECTION 132D OF THE COMPANIES ACT, 1965 FOR THEDIRECTORS TO ISSUE SHARES"THAT, subject always to the Companies Act, 1965, the Articles of Association ofthe Company and the approvals of the relevant government/regulatoryauthorities, the Directors be and are hereby authorised, pursuant to Section132D of the Companies Act, 1965, to allot and issue shares in the Company at any time until the conclusion of the next Annual General Meeting and uponsuch terms and conditions and for such purposes as the Directors may, in theirabsolute discretion, deemed fit, provided that the aggregate number of sharesto be issued does not exceed 10% of the issued share capital of the Companyfor the time being and that the Directors are also empowered to obtain theapproval from the Bursa Malaysia Securities Berhad for the listing and quotationfor the additional shares to be issued."

6. PROPOSED RENEWAL OF SHAREHOLDERS' MANDATE FOR RECURRENTRELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATURE INVOLVING MADAM CHAN LAY LI"THAT, approval be given to the Company and/or its subsidiary companies toenter into recurrent transactions of a revenue or trading nature as stated inSection 2.1 of the Circular to Shareholders dated 04 September 2012 ("Circular")involving Madam Chan Lay Li with related parties which are necessary for theday-to-day operations and on normal commercial terms not more favourable tothe related parties than those generally available to the public and are not tothe detriment of the minority shareholders as set out in the Circular ("theMandate").

THAT the Directors be empowered to do all such acts and things (includingexecuting all such documents as may be required) as they may be consideredexpedient or necessary to give full effect to the Mandate with full powers toassent to any conditions, modifications, revaluations, variations and/oramendments (if any) as may be imposed by the relevant authorities AND THATsuch Mandate shall commence upon passing of this ordinary resolution andwill expire at the conclusion of the next AGM of the Company following thepassing of this ordinary resolution or the expiry of the period within which thenext AGM is required by law to be held but shall not extend to such extensionas may be allowed pursuant to Section 143(2) of the Companies Act, 1965 (unlessearlier revoked or varied by ordinary resolution of the shareholders of theCompany in general meeting, whichever is earlier);

NOTICE OF ANNUAL GENERAL MEETING

Please refer to note 7

Ordinary Resolution 2Ordinary Resolution 3

Ordinary Resolution 4





THAT disclosure will be made in the Annual Report of the Company of theaggregate value of Recurrent Related Party Transactions conducted pursuantto the Mandate during the financial year based on the following information :-

(i) the type of Recurrent Related Party Transactions made; and(ii) the names of the related parties involved in each type of the Recurrent Related

Party Transactions made and their relationship with the Company."

7. PROPOSED RENEWAL OF SHAREHOLDERS' MANDATE FOR RECURRENTRELATED PARTY TRANSACTIONS OF A REVENUE OR TRADING NATUREINVOLVING MR. LIM TECK CHYE, MADAM LIM POH LENG AND MADAMCHAN LAY LI"THAT, approval be given to the Company and/or its subsidiary companies toenter into recurrent transactions of a revenue or trading nature as stated inSection 2.1 of the Circular to Shareholders dated 04 September 2012 ("Circular")involving Mr. Lim Teck Chye, Madam Lim Poh Leng and Madam Chan Lay Li withrelated parties which are necessary for the day-to-day operations and on normalcommercial terms not more favourable to the related parties than those generallyavailable to the public and are not to the detriment of the minority shareholdersas set out in the Circular ("the Mandate").

THAT the Directors be empowered to do all such acts and things (includingexecuting all such documents as may be required) as they may be consideredexpedient or necessary to give full effect to the Mandate with full powers toassent to any conditions, modifications, revaluations, variations and/oramendments (if any) as may be imposed by the relevant authorities AND THATsuch Mandate shall commence upon passing of this ordinary resolution andwill expire at the conclusion of the next AGM of the Company following thepassing of this ordinary resolution or the expiry of the period within which thenext AGM is required by law to be held but shall not extend to such extensionas may be allowed pursuant to Section 143(2) of the Companies Act, 1965 (unlessearlier revoked or varied by ordinary resolution of the shareholders of theCompany in general meeting, whichever is earlier);

THAT disclosure will be made in the Annual Report of the Company of theaggregate value of Recurrent Related Party Transactions conducted pursuantto the Mandate during the financial year based on the following information :-

(i) the type of Recurrent Related Party Transactions made; and(ii) the names of the related parties involved in each type of the Recurrent Related

Party Transactions made and their relationship with the Company."

8. To transact any other business of which due notice shall have been given inaccordance with the Company's Articles of Association and the Companies Act,1965.

By Order of the Board

LEE PENG LOON (MACS 01258)P'NG CHIEW KEEM (MAICSA 7026443)Joint Secretaries

Penang04 September 2012





FURTHER NOTICE IS HEREBY GIVEN THAT for the purpose of determining a member who shall be entitledto attend the Twentieth Annual General Meeting, the Company shall be requesting Bursa Malaysia DepositorySdn. Bhd. to issue a General Meeting Record of Depositors as at 20 September 2012. Only a depositor whosename appears on the Record of Depositors as at 20 September 2012 shall be entitled to attend the saidmeeting or appoint proxies to attend and/or vote on his/her behalf.

NOTES ON APPOINTMENT OF PROXY

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

2. For a proxy to be valid, the proxy form duly completed must be deposited at the Registered Office of theCompany, 51-21-A Menara BHL Bank, Jalan Sultan Ahmad Shah, 10050 Penang not less than forty-eight (48)hours before the time appointed for holding the meeting.

3. A member shall be entitled to appoint more than one (1) proxy to attend and vote at the same meeting.

4. Where a member appoints more than one (1) proxy to attend and vote at the same meeting, such appointmentshall be invalid unless the member specified the proportion of his shareholdings to be represented by eachproxy.

5. If the appointor is a corporation, the proxy form must be executed under its Common Seal or under the handof its attorney.

6. Where a member is an Exempt Authorised Nominee which holds ordinary shares of the Company for multiplebeneficial owners in one securities account (”omnibus account”), there is no limit to the number of proxiesit may appoint in respect of each omnibus account it holds.

EXPLANATORY NOTE ON ORDINARY BUSINESS

7. Agenda 1 is meant for discussion only as the provision of Section 169(1) of the Companies Act, 1965 does notrequire a formal approval of the shareholders of the Company and hence, Agenda 1 is not put forward forvoting.

EXPLANATORY NOTES ON SPECIAL BUSINESS

8. The proposed Ordinary Resolution 5, if passed, will give the Directors of the Company authority to issue sharesin the Company up to an amount not exceeding 10% of the total issued capital of the Company for the timebeing for such purposes as the Directors consider would be in the best interest of the Company. This authority,unless revoked or varied by the shareholders of the Company in general meeting will expire at the conclusionof the next Annual General Meeting.

The general mandate for issue of shares is a renewal. As at the date of notice of the meeting, no shares hasbeen issued pursuant to the general mandate granted at the last Annual General Meeting of the Companyand of which, it will lapse at the conclusion of the 20th Annual General Meeting of the Company to be heldon 27 September 2012.

The general mandate for issue of shares will provide flexibility to the Company for any possible fund raisingactivities, including but not limited to further placing of shares for the purpose of funding future investment,working capital and/or acquisition.

9. The proposed Ordinary Resolutions 6 and 7, if passed, will enable the Company and its subsidiaries to enterinto recurrent transactions involving the interests of related parties, which are of a revenue or trading natureand necessary for the Group's day-to-day operations, subject to the transactions being carried out in theordinary course of business and on terms not to the detriment of minority shareholders of the Company,particulars of which have been disclosed in the Circular to Shareholders dated 04 September 2012 which havebeen dispatched together with the Company's Annual Report.

10. Annual ReportThe Annual Report is in CD-ROM format. Printed copy of the Annual Report shall be provided to the shareholderupon request within four (4) market days from the date of receipt of the verbal or written request. The AnnualReport can also be downloaded from the Company's website at www.emico.com.my.

Shareholders who wish to receive the printed Annual Report and who require assistance in viewing the CD-ROM, kindly contact Puan Nor Azimah Binti Bulat at telephone no. 03-2264 3883 or email your request [email protected]


This page is left blank intentionally

PROXY FORM

EMICO HOLDINGS BERHAD(Company No. 230326-D)

(Incorporated in Malaysia)

* I /We___________________________________________________________________________________________________(Full Name in Block Letters)

of_______________________________________________________________________________________________________(Address)

being a * member / members of the above named Company, hereby appoint_________________________________________

_________________________________________________________________________________________________________(Full Name in Block Letters)

of_______________________________________________________________________________________________________(Address)

or failing him, the Chairman of the Meeting as * my / our proxy to vote for * me / us on * my / our behalf at the TwentiethAnnual General Meeting of the Company to be held at The Conference Room of Emico Holdings Berhad, 18 LebuhrayaKampung Jawa, 11900 Bayan Lepas, Penang on Thursday, 27 September 2012 at 11.00 a.m. and at any adjournment thereof.

RESOLUTION ORDINARY RESOLUTION1 2 3 4 5 6 7

FORAGAINST

Please indicate with an "x" in the appropriate spaces provided above on how you wish your vote to be cast. If no specificdirection as to voting is given, the proxy may vote or abstain from voting at his/her discretion.

Signed this..................................................day of ................................................., 2012.

No. of shares held

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. For a proxy to be valid, this form duly completed must be deposited at the Registered Office of the Company, 51-21-A Menara BHL

Bank, Jalan Sultan Ahmad Shah, 10050 Penang not less than forty-eight (48) hours before the time appointed for holding the meeting.3. A member shall be entitled to appoint more than one (1) proxy to attend and vote at the same meeting.4. Where a member appoints more than one (1) proxy to attend and vote at the same meeting, such appointment shall be invalid unless

the member specified the proportion 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 its attorney.6. Where a member is an Exempt Authorised Nominee which holds ordinary shares of the Company for multiple beneficial owners in one

securities account (”omnibus account”), there is no limit to the number of proxies it may appoint in respect of each omnibus accountit holds.

* Strike out whichever is not desired.

..........................................................................Signature of Member(s)

contents annual report 2012 01 corporate information 02 board of directors’ profile 03 corporate...

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