mtcc · mr. abdulla ali government terminated on 04 feb 2009 mr. ibrahim shaheen government...

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MTCCANNUAL REPORT2009

Corporate

Our MissionTo contribute fully, to the development of the economy and the country.

Our VisionWe want to lead in our respective business through organic growth and collaborative innovation and creativity in this fast changing socio economic environment where we foster continuous staff development and be known as the company to be trusted to deliver what the customer wants.

Our Values • Collaborative innovation and creativity - continuous improvement as a work ethic. • Changing the work environment for employees - people growth and development. • Honesty and integrity - respect the fellow individual. • Social Responsibility - community contribution and responsibility. • Profit, but profit from work that benefits the economy - profitable growth.

MTCC ANNUAL REPORT 2009

To download the PDF version of this publication, please visit our website at: http://www.mtcc.com.mv/publications.asp

All amounts are in Maldivian Rufiyaa unless otherwise stated. US Dollar exchange rate: Mrf 12.85Layout and Design: Maldives Transport and Contracting Company Plc.Published by: Maldives Transport and Contracting Company Plc Published date: July 2010

In the name of Allah the most Gracious the most Merciful

Corporate

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Notice of Annual General MeetingStatement of the ChairmanDirector’s ReportBoard of Directors Senior ManagementCorporate InformationBankers, Auditors & LawyersDepartment’s Contact Information

Financial Statements

456

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MTCCANNUAL REPORT

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Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN THAT the Annual General Meeting of Maldives Transport and Contracting Company Plc will be held at the “STELCO Maalan” on 08th August 2010 at 21:00 hrs for the following purposes.

Agenda1. Announcement and election of Directors. 1.1 Intimation of Directors nominated by the Government. 1.2 Election of Directors representing public shareholders, in place of Mr. Ameen Ibrahim, H.Haali and Mr. Ali Shafeeu, M.Hudhukaneeruge who had completed their terms of office.

2. 2.1 Confirmation of Minutes of the Annual General Meeting 2008. 2.2 Confirmation of Minutes of the Extraordinary General Meeting held on 19th August 2009.

3. 3.1 To receive and adopt the Report of Directors and the Statement of Accounts and Balance Sheet of the company for the year ended 31st December 2009, with Auditor’s Report thereon. 3.2 Confirmation of dividend payable to shareholders.

4. Appointing of auditors and their fees for the year 2010.

5. Confirmation of the ammended Article of Association and Memorandum of Association.

6. Shareholder’s discussion.

7. Conclusion

20th July 2010

By order of the Board

Sheereen NaseemCompany Secretary

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Corporate

Statement of the Chairman

The devastating global economic condition in the year 2009 had significantly impacted the Maldivian economy as a whole causing financial challenges to MTCC.

As such Company’s 2009 revenue has decreased to 30.69% (2009 revenue: Rf 474 million) when compared to 2008 revenue (2008 revenue: Rf 684 million). Meanwhile company also resulted a net loss of Rf 12.35 million in the year 2009.

Major reasons for the loss includes, loss due to termination of G.Dh Maavehdhoo Project undertaken for Airports Investment Maldives Pvt. Ltd. (33% shareholding company of MTCC Plc), loss incurred from G.Dh Gahdhoo Project and also due to delay in payments from customers, company had to run at a huge overdraft thus incurring huge financing cost. Thus due to this delay in receiving payments MTCC had to provide a huge provision during the year ended 2009. Apart from the mentioned reason’s Company’s Transport Department also made a significant loss to the Company.

MTCC contributes to various industries in the economy including fishing, construction, transportation and real estate business. However, due to the decline in fishing industry, products such as Yanmar Engine, Castrol lubricants’ sold to fishermen resulted a huge decline in revenue. Compared to 2008 number of Construction Projects undertaken by the company declined in 2009 further reducing the revenue.

Although 2009 was a difficult year to MTCC, 2010 looks promising. With this aim I would like to thank the members of the Board for their precious continuous contribution and support rendered in directing the Company. I would also take this opportunity to thank all our valuable customers and business partners and shareholders. Last but not the least I would also like to thank the enthusiastic management and staff of the company. For their continous support and contribution rendered to MTCC in achieving the Company’s goals.

May Allah, the almighty bestow a prosperous, bright future than today. Amen.

Hussain HilmyChairman

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MTCCANNUAL REPORT

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The Director’s Report of Maldives Transport and Contracting Company Plc and the audited Financial Statements for the year ended 31st December 2009 were approved by the Board of Directors on 20th July 2010.

Managing the Company The most important task undertaken to strengthen the operation of the Company was restructuring of the company and changing the operation of the company under the new structure with a new vision. The Board played a major role in directing the Company, identifying the goals of the Company, determining policies to achieve these goals and assisting to obtain the financial and human resources required for the operation to the Company.

It is amongst the responsibility of the Board of Directors to determine business targets and approve financial budgets to ensure these targets are achieved. The Board must also ensure that the company maintains a sound Internal Control Mechanism and that the resources of the Company are utilized in the best interest of the Company. It is the duty of the Board to guide the Company in sustaining the business and increase shareholders wealth. It is also the responsibility of the Board to directly and indirectly take all necessary steps to obtain the objectives of the Company.

The role of the Shareholders in the company is to elect Directors and Auditors for the company and to check through the Board Directors whether the company is directed and managed by sound company policies.

The Board of Directors The Board of Directors consists of 10 directors, of whom 6 are nominated by the government and 4 are elected by the public shareholders. Amongst these Directors, there is one Executive Director and nine Independent Directors.

Mr. Ibrahim Athif Shakoor was the Managing Director till 07th January 2009. Mr. Mohamed Naseem Ibrahim was appointed as a Managing Director on 07th January 2009 and he was appointed as a member of the Board on 4th February 2009 respectively. From the Directors elected by the public shareholders, the two Directors who resigned upon conclusion of their term are Mr. Hussain Halee, H. Iruvai and Ms. Fathimath Sheereen, M. Sherin. The Directors elected for the next term by the shareholders were Mr. Hussain Halee, H. Iruvai and Mr. Mansoor Zubair, Kothanmaage S. Hithadhoo.

Upon the resignation of Director Mr. Ibrahim Muhthalib, Ma. Summit on 28th May 2009, a Special General Meeting was held on 19th August 2009 to elect a replacement and Mr. Ali Shafeeu, M.Hudhukaneeruge was elected by the shareholders as a new member to the Board of Directors.

The Board of Directors at the end of year 2009: 1. Mr. Hussain Hilmy, Ma. Vahaari Chairman (appointed by the Government/ Independent)

2. Mr. Mohamed Naseem Ibrahim, M.Snow Down Managing Director (appointed by the Government/ Executive)3. Mr. Abdulla Naushad, M.Shaama Director (appointed by the Government/ Independent)

Director’s Report

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Corporate

4. Mr. Abdul Nasir Mohamed, G.Liver Pool Director (appointed by the Government/ Independent)

5. Mr. Abdulla Shaairu, M.Furahaniaage Director (appointed by the Government/ Independent)

6. Ms. Shafeenaz Abdul Sattar, H.Helengeli Director (appointed by the Government/ Independent)

7. Mr. Hussain Haaly, H.Iruvai Director (elected by shareholders/ Independent)

8. Mr. Ameen Ibrahim, H.Haali Director (elected by shareholders/ Independent)

9. Mr. Mansoor Zubair, Kothanmaage, S.Hithadhoo Director (elected by shareholders/ Independent)

10. Mr. Ali Shafeeu, M.Hudhukaneeruge Director (elected by shareholders/ Independent)

Changes to the Board of Directors during the year 2009:

Dr. Faathin Hameed Government Terminated on 04 Feb 2009Mr. Ibrahim Athif Shakoor Government Terminated on 07 Jan 2009Mr. Mohamed Shainee Government Terminated on 04 Feb 2009Mr. Abdulla Ali Government Terminated on 04 Feb 2009Mr. Ibrahim Shaheen Government Terminated on 04 Feb 2009Mr. Hussain Hilmy, Ma. Vahaari Government Appointed on 04 Feb 2009Mr. Mohamed Naseem Ibrahim Government Appointed on 04 Feb 2009Mr. Abdulla Naushad, Government Appointed on 04 Feb 2009Mr. Abdul Nasir Mohamed Government Appointed on 04 Feb 2009Mr. Abdulla Shaairu Government Appointed on 04 Feb 2009Ms. Shafeenaz Abdul Sattar Government Appointed on 04 Feb 2009Ms. Fathimath Sheereen Shareholder Resigned on 29 Apr 2009Mr. Hussain Haaly Shareholder Re-appointed on 29 Apr 2009Mr. Mansoor Zubair Shareholder Appointed on 29 Apr 2009Mr. Ibrahim Muhthalib Shareholder Resigned on 28 May 2009Mr. Ali Shafeeu Shareholder Appointed on 19 Aug 2009

During 2009, 13 meetings of the Board of Directors was held. The attendance of the Directors are:

Directors No. of Meetings No. of meetings to attend attendedMr. Hussain Hilmy 13 12Mr. Mohamed Naseem Ibrahim 13 13Mr. Abdulla Naushad 13 06Mr. Abdul Nasir Mohamed 13 11Mr. Abdulla Shaairu 13 13Ms. Shafeenaz Abdul Sattar 13 10Mr. Ameen Ibrahim 13 12Mr. Hussain Haaly (reappointed on 29th April 2009) 12 11Ms. Fathimath Sheereen (resigned on 29th April 2009) 04 03Mr. Mansoor Zubair (appointed on 29th April 2009) 08 06Mr. Ibrahim Muhthalib (resigned on 28th May 2009) 05 04Mr. Ali Shafeeu (appointed on 19th August 2009) 03 03

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MTCCANNUAL REPORT

2009

Corporate

Corporate Governance Under Corporate Governance the role and responsibilities of the Board and Board committees has expanded. Efforts were made to strengthen and upgrade the functioning of management.

Role of the Chairman

• Leads the Board to ensure that the responsibilities of the board are fulfilled effectively and sets the agenda of the board.

• Provide correct information to the Directors on a timely manner.• Encourage constructive participation of the board with the management.• Facilitate participation of nonexecutive directors in the company in the most effective

manner through board meetings and etc.• Encourage constructive involvement between executive and nonexecutive Directors • Implement policies only after independent and detail debates among the board

members.• Facilitate relevant information to the shareholders on various issues.• Implement and execute Corporate Governance Rules and Regulations within the

Company

Overall Responsibility of the Board of Directors The overall responsibility of the Board of Directors includes ensuring that the company operates within the limits of the Company’s Act, Corporate Governance Code, and any other regulations that the company should abide by, to protect the interest of shareholders, to determine the business policies and lead the company in enforcing the set policies.

It is also the responsibility of the board to acquire the basic investment, financial and human resources needed to achieve the objectives of the company.

To overcome possible threats to the company by ensuring that the company’s internal control mechanism is functioning soundly.

Establishing the objectives of the company and ensuring the objectives are accomplished. Formations of Committees as and when required and determine the rights, roles and responsibilities of these committees in a comprehensive manner.

Works carried out by the Board CommitteesAudit CommitteeDuring the year 21 meetings of the Audit Committee was held. The attendance of the Directors are:

Directors No. of Meetings No. of meetings to attend attendedMs. Fathimath Sheereen 1 0Mr. Ibrahim Muhthalib 1 0Mr. Shafeenaz Abdul Sattar 21 20Mr. Hussain Haaly 20 19Mr. Abdul Nasir 21 17Mr. Mansoor Zubair 21 19

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Corporate

Director Ali Shafeeu’s professional expertise was also utilized in the committee meetings.

Among the tasks carried out by the committee includes organizing a mechanism for reviewing monthly and quarterly reports to the committee and reporting the Company’s financial performance to the board.

The committee met with the Internal Auditors of the Company to discuss the issues highlighted in reports submitted by them. Issues highlighted in the report were discussed with relevant department heads and directions on how to rectify these issues were given. In addition to this, issues highlighted by the committee and specific issues requested by the board were also audited through the Internal Auditors and solution to these issues requested through the management. Also appropriate guidelines to strengthen the internal controls were determined through the management.

To strengthen the internal Controls of the Company efforts were made through the management to establish a sound internal control mechanism. In addition the committee advised the Board on implementing cost cutting measures in response to the devastating financial situation of the company.

Ms. Shafeenaz Abdul Sattar Chairperson, Audit Committee

Nominating CommitteeDuring the year 6 meetings of the Nominating Committee was held. The attendance of the Directors are;

Directors No. of Meetings No. of meetings to attend attendedMr. Ameen Ibrahim 6 6Mr. Hussain Haaly (Due to conflict of interest, 4 4 not invited for 2 meetings)

Mr. Abdulla Shaairu 6 4Mr. Abdulla Naushad 6 3

The tasks carried out by the nominating committee includes verifying the details in accordance with Corporate Governance code and Article of Association of the Company of the applied candidates for Board of Directors for Annual General Meeting 2008.

Evaluation of candidates for the vacant position on resignation of Mr. Ibrahim Muhthalib, who was elected by the shareholders was also carried out by the nominating committee.

Mr. Ameen Ibrahim Chairman, Nominating Committee

Remuneration CommitteeDuring the year 3 meetings of the Remuneration Committee was held. The attendance of the Directors are;

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MTCCANNUAL REPORT

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Corporate

Directors No. of Meetings No. of meetings to attend attendedMr. Ameen Ibrahim 3 3 Mr. Hussain Haaly 3 3 Mr. Abdulla Shaairu 3 2 Mr. Abdulla Naushad 3 1

The tasks carried out by the remunerating committee includes determining the salary and allowances of staffs working at international tug, determining the criteria for promotion/increment of staffs and discussing of the revision and amendments on the Company’s Salary and Benefit Policy and advising the Board on the pay leave issue of staffs studying aborad.

Mr. Ameen Ibrahim Chairman, Nominating Committee

Grievance CommitteeA grievance committee was compiled including a member of Board (Director Mr. Ameen Ibrahim) to attend to grievances of staff relating to various issues. Works of this committee was also carried out during the year 2009.

Activities and Performance of Departments Contracting and Projects DepartmentThe main projects carried out by the department includes dredging, construction of harbour and other related works. In addition to this reclamation, building construction and sewerage projects were also carried out by this department. Deputy Director, Mr. Hussain Shiyam was the head of Contracting and Projects Department until June 2009, followed by deputy Director Mr. Hussain Shaheed from June to November 2009 and Deputy Director Mr. Abdulla Thasleem from November 2009 onwards.

Projects carried out by the departmentA total of 13 projects were awarded and commenced and works of 5 projects were completed during the year. This includes reclamation and harbour re-construction projects. 09 projects which was carried forward from previous years was also completed during this year.

Major projects carried out during this year and projects carried forward to this year includes:• Domestic Maritime Transport Project• K. Maafushi Jail House Project• HDh. Kulhudhufushi Harbour Project• GA. Nilandhoo Harbour Project• R. Alifushi Harbour Project• L. Gan Mukurimagu Harbour Project• L. Gan Thundi Sewerage Project

GA. Nilandhoo, harbour project

HDh. Kulhudhuffushi, harbour project

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Corporate

• L. Gan Housing Project• R. Meedhoo Harbour Project• ADh. Mahibadhoo Harbour Project• R. Rasmaadhoo Harbour Project• R. Vaadhoo Harbour Project• ADh. Kunburudhoo Harbour Project• GDh. Maavehdhoo Airport Reclamation Project

Transport Service Department Transport Services, the widest service provided by the company is provided by Transport Services department. This includes Grater Male’ ferry operation, charter launch service, bus services, ferry and launch service in various regions of the country. The department was temporarily headed by Assistant Director Ms. Hawwa Huzaima until 3rd February 2009 followed by Deputy Director Mr. Ahmed Solih until 3rd March 2009. Ms. Hawwa Huzaima was permanently assigned to head the department from March 2009.

Major activities carried out by the department.• Travel bureau was merged with Transport Services Department on March 2009. All

works carried out by travel bureau except Island Aviation Ticketing was discontinued.• Agreement to take over Bus Service at Hulhumale’ was signed with Housing

Development Corporation and this service commenced in August 2009.• Integrated Transport Network bid for Medhu Uthuru province consisting of Alif Alif, Alif

Dhaalu, Kaafu and Vaavu atoll was submitted in July 2009, this bid was awarded to MTCC and agreement signed on October 2009.

• Commencement of transport network ferry service at Alif Dhaalu Atoll in December 2009• Addu Regional Hub and Raa Atoll regional Hub under comprehensive Pre-scheduled

Transport Network was closed down during 2009.

Engineering Department The name of Thilafushi Business Department was changed to Engineering Department on 04th March 2009. Repair works of all vessels, vehicles, machinery and equipment of the company is carried by this department. In addition to this loading service, docking facilities and precast concrete works were also carried out by the department. Deputy Director, Mr. Ahmed Ranesh was the head of the department during 2009.

Major activities carried out by the department.• In addition to the warehouse to carry out the technical repair works, construction of an

additional warehouse for marine engine work was started.• Repair works of Kurimagu 7 (international barge)

was carried out.• Installation of a new engine system for Tango 575

(international tug).• Agreement to cast L-section blocks for the harbour

works of 3 islands damaged due to Tsunami was signed with AKDA, a foreign company and this work carried out during the year.

• Due to the beach erosion of Thilafushi MTCC site, protection works was carried out using shore protection blocks.

• A series of training program on repair and maintenance of heavy vehicles was conducted in collaboration with Tractor Singapore Limited.

Repair and maintenance work in progress of International barge, Kurimagu 7 at K.Thilafushi.

Maiden voyage from ADh. Mahibadhoo to innaugrate ferry services for Medhu Uthuru Province.

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MTCCANNUAL REPORT

2009

Corporate

Sales and Marketing DepartmentAll trading activities of the company are carried out by this department. Major products sold on a wide scale are Yanmar engines, Suzuki Outboard motor engines, generators, lubricants, and protective coatings. After sales service for these engines are also provided by the department.

Marketing department was merged with Sales department on 4th March 2009 forming Sales and Marketing Department. These two departments were individually headed by Deputy Director Ms. Abida Rasheed and Deputy Director Mr Ihusaan Shareef respectively.

Major activities carried out by the department.• Participated in “Maldives Industrial Boat Show 2009” and displayed main products of the

company. An information seminar on products of Castrol and Sigma was conducted in this seminar.

• Participated in the Fisherman’s day celebrations held in HA.Ihavandhoo.• Promotional trips to introduce products of the company to boat builders, engineers,

distributors and agents were made to Mathi Uthuru province, Medhu Dhekunu Province and Raa Atoll.

• Promotional trips and product seminars were conducted in Mathi Uthuru Province, Dhekunu Province, HDh. Kulhudhufushi and Ha. Ihavandhoo.

Logistic and Rentals Department Rentals unit which was under Sales Department since October 2008 and Logistic Unit under Transport Department was merged as one department and named Logistics and Rentals Department on 04th March 2009. Tasks carried out by this department includes renting of heavy machinery and equipments needed for the construction industry, mobilizing vehicles and equipments to project sites within the region and ship agency for passenger lines and ships harbouring the Country. This department was headed by Deputy Director Mr. Ahmed Solih.

Major activities carried out by the department.• Since the rentals service that was established in Laamu Atoll and Addu was not

performing well, the service was discontinued and items were brought back to Male’ Rentals Unit.

• Levelling of Lh. Naifaru roads and disposal of rubbish was carried out.• Concrete testing service that was carried out by this department was transferred to

Thilafushi Business Department.• Bid auctions were opened for interested participants from regions.

Corporate Department Deputy Director Ms. Sheereen Naseem was the head of the department till November 2009, after which Manager, Ms. Aishath Susan Haneef was assigned.

Major task carried out by the department.• All issues relating to shareholders• All tasks of Board and Board committees• Ensures that Company follows the rules of Corporate Governance

Administration DepartmentAdministration department was formed on February 4, 2009. Deputy Director, Ms. Abidha Rasheed was assigned to head Administration department.

Product awareness seminar conducted for Mathi Uthuru Province.

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Corporate

Major task carried out by the department.• Administrative works of the company• Managed International and domestic travels• Protocol and maintenance work.

Human Resources DepartmentAt the end of 2009, a total of 1001 employees were in the company, out of which 878 Males and 123 Females and 362 were expatriates. Recruitment, training and development of staff and obtaining medical insurance for all staff are managed by this department. In addition to this staff evaluation and all employee related issues are handled by this department. Manager, Ms. Fathimath Jabeen was the head of the department till February 03, 2009, after which the department was assigned to Director, Mr. Ibrahim Shaheen.

Major task carried out by the department.• Compiling of steering committee and commencement of work.• Revision of Company’s Salary and Benefit policy in accordance with the new Employees

Act 2008/2 and implementation of this Act on March 26, 2009.• Compiling a “Code of Conduct” as a guideline for staff work place discipline• Changing of official working hours of the company and revision was made to the policy

of working overtime.• A marine safety training session was conducted in collaboration with MNDF Coastguard

to the staff of Transport Services Department• Analysing the medical Insurance Scheme and evaluation of proposals received for

2010 Insurance and changing the Staff Medical insurance for 2010 to Allied Insurance Company of the Maldives Pvt Ltd.

• A total of 84 staffs had been participated in both local and international short term training.

Accounts and Finance DepartmentAccounts and Finance department is involved in compiling the financial statements of the company, making all payments due, collecting all receivables, preparing performance reports, compiling annual budgets, costing, pricing and asset management. Preparing feasibility analysis for new projects, acquiring funding for projects, managing inventory and system support are also tasks carried out by this department. Chief Accountant, Mr. DS. Manchanayeke was the head of the department.

Procurement and Supplies DepartmentThe role of procurement and Supplies Department includes procuring goods from internal and external markets as per departments/projects requirements. Deputy Director Mr.Usman Hafeez was the Head of this Department in 2009.

Financial and Management Audit Department Strengthening the internal controls of the company and individual internal audit of all departments were carried out by this department. This department was headed by Internal Audit Executive, Mr. PM. Sakthivel.

Legal DepartmentLegal department manages all legal and legislative activities of the company and represent the company on legal issues for and against MTCC. Insurance of all vessels, vehicles, machinery and equipment is also managed by this department. Manager, Ms. Fathimath Liusha was in charge of this department.

Marine safety training held in collaboration with Coast Guard MNDF.

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MTCCANNUAL REPORT

2009

Corporate

Information Systems DepartmentImplementing the information system infrastructure and connecting the departments of the company through a computer network is the responsibility of this department. Managing this network and solving problems encountering to individual systems is also looked after by this department. Also acquiring relevant software required for the company and customizing these software if required as per the requirement of the company is also handled by this department. Manager, Mr. Ahmed Salaam was the head of the department till February 03, 2009, after which the department was assigned to Deputy Director, Mr. Hamid Nasheed Mohamed.

Social Responsibility

The Company sustained its position in the society at an acceptable level by contributing to the sustainable development of the Country. The company was also experiencing the economic down turn faced by the Country during the past year. Due to this reason, even though the Company was not able participate in many social activities in an acceptable manner like previous years, the company participated in various activities organized throughout the year by the government and private institutions to protect the environment.

Financial Performance 2009

The company recorded a turnover of Rf 474,340,631 for the year ended 31st December 2009, representing a 30.69% dropped over the previous year 2008 of Rf 684,337,558. Cost of Sales as a % of Sales also dropped from 79% to 77% in 2009, which led to an increase in Gross Profit Margin from 21% in 2008 to 23% in 2009. Despite the impact of global economic downturn which gathered momentum affected the company’s business operations. (2008 accounts restated)

Expenses as a % of Sales increased from 14% in 2008 to 22% in 2009. Finance Costs as a % of sales increased from 2.8% in 2008 to 4.8% in 2009. Even though Gross Profit Margin increased, increase in expenses and financial costs resulted in a Net Loss as a % sales of 3% in 2009.

Stock turnover ratio has increased from 94.15 days in 2008 to 135.78 days in 2009. Current ratio decreased from 1.17 times to 1.10 when compared to 2008. Quick ratio dropped from 0.71 in 2008 to 0.66 in 2009.

Debt-equity ratio increased from 0.63 in 2008 to 0.71 in 2009.

Revenue Gross Profit Operating Profit Net Profit

Mrf

(Mill

ions

)

100

0

-100

200

300

400

500

600

700

800Comparison

of Operating Performance

2009 Group

2009 Company

2008 Group

2008 Company

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Corporate

Net Worth of the company as measured by the Net Assets decreased from Mrf 335.54 m in 2008 to Mrf 304.11 m in 2009. There was no movement of Company’s share in the Stock Market. Earnings per share in 2008 was Mrf 135.06 (restated), while 2009 resulted in a loss of Mrf 49.42 per share.

Major part of the Company’s revenue is generated from Contracting and Trading Business segments. Revenue contribution of the segments of the Company for the fiscal year are Trading 22% (2008: 31%), Contracting 55% (2008: 52%), Marine 16% (2008: 10%), others 7% (2008: 7%).

The operating profit contribution of the segments for the year are Trading 162.69% (2008: 48.35%), Contracting 296.75% (2008: 125.75%), Marine -80.82% (2008: -12.86%) and Others 146.68% (2008: 20.34%) Unallocated to segments -425.31% ( 2008: -81.58%).

MTCC’s Business Segments

The core business units of MTCC are based in Male’ and Thilafushi; and consist of 5 strategic business departments ,namely Sales Department, Contracting Department, Transport Service Department, Rentals and Logistics Department and Engineering Department; the main contributors towards the profits of the organization being Contracting and Trading segments.

Market Capitalisation to

Net Assets

Market Capitalisation (on average price)

Net Assets

2009 Group 2009 Company 2008 Group 2008 Company

50

0

100

150

300

200

350

250

400

Mrf

(Mill

ions

)

Comparison of Revenue to

Operating Porfit for all Segments

2009

Sales

Operating Profit / (Loss)

Trading Contracting Marine Other

50

(50)

0

100

150

300

200

250

Mrf

(Mill

ions

)

Total Equity to Total Debt

Total Equity

Total DebtM

rf (M

illio

ns)

2009 Group 2009 Company 2008 Group 2008 Company

100

0

200

300

400

500

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MTCCANNUAL REPORT

2009

Corporate

The company expanded its business activities during the fiscal year 2009 and major investments were made in each sector of business segments of the company.

TradingThe products traded in this business unit cater mainly to the marine market segment of the Maldives. The product range covered includes Castrol lubricants, Yanmar engines, Suzuki outboard engines, Yanmar generators, spare parts, Onan marine generators, Hamilton water jets, Sigma marine and protective coatings and industrial gas. This business segment focuses on maintaining its position in the target segments whilst broadening its products portfolios range by screening world markets for quality premium products.

The revenue of this segment decreased by 49.46% in the year 2009 compared to 2008 and the operating profit for the segment decreased by 33.77%. This is mainly due to curtailment of credit by the Banks as a result of world credit crunch that made difficult for boat owners to purchase engines on credit. Furthermore leasing facilities were tightened whereby boat owners were compelled to put in both boat and engine as leasing security. Also poor fish landings in the past two years slowed the boat building sector and the demand for engines. As such demand for materials like Sigma paints, Castrol and engine spares also decreased when compared to the previous years.

Contracting Contracting Department provided services mainly to the marine and land construction sector. Contracting is the largest contributing segment of the company in terms of revenue generation and its contribution to the total revenue of the company had been 55% in 2009. The revenue and the operating profit of the department decreased by 26% and 54% respectively in the year 2009 compared to the preceding year. Reason for decrease in revenue was due to cancellations and deferrals of government access harbour and reclamation projects. Furthermore huge losses were incurred on termination of G.Dh Maavehdhoo Project undertaken for Airports Investment Maldives Pvt. Ltd.

MarineEven though the marine segment continuously runs on a loss, the Company focuses on providing efficient and reliable services by making significant investments in this segment. Total revenue of this segment increased by 7.64% in comparison with 2008. However increase in the operational expenses resulted in an increase in net loss of 23.73% with respect to 2008.

Other products and ServicesDepartments here include Rentals and Logistics Department and Thilafushi Business Department.

Revenue from this segment has decreased from Mrf 49.50 m in 2008 to Mrf 30.68 m in the year 2009. Operating profit in 2009 increased to Mrf 15.25 m from Mrf 3.45 m in the year 2008.

Shaping the Future

MTCC is a company, which views economic downturns as an opportunity to build up its marketplace position and outperform its competitors. In order to respond to the wide range of challenges and obstacles presented by the current environment, we are working closely in areas such as customer acquisition and retention, rapid and sustained cost management, operational excellence and as well as on longer term business transformation initiatives. By leveraging our business re-engineering and experience, we will address specific challenges and improve our performance in the economy.

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Corporate

Acknowledgement

Our success is defined by the continuous support and trust from all our stakeholders, including customers, shareholders, and business partners, and we take this opportunity to specially thank them. We also thank the pillars behind the success, the committed and hardworking employees of the company.

We pray Allah almighty to continue bestow a prosperous future for year ahead. Ameen!

20 July 2010

Hussain Hilmy Mohamed Shafeeq Chairman ActingChiefExecutiveOfficer

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MTCCANNUAL REPORT

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Financial Highlights

2005 2006 2007 2007 Group

2008 2008 Group

2009 2009 Group

100

0

200

300

400

500

600

700

800

MR

F M

illio

ns

Revenue

Net Profit (before extra-ordinary items)

Reveue and Net Profit

2005 2006 2007 2007 Group

2008 2008 Group

2009 2009 Group

100

0

200

300

400

500

600

700

800

MR

F M

illio

ns

900

Total Corporate Debt

Total Assets

Total Corporate Debt and Total

Assets

2005 2006 2007 2007 Group

2008 2008 Group

2009 2009 Group

100

0

200

300

400

500

600

700

800

MR

F M

illio

ns

900

Shareholders Funds

Total Assets

Shareholders Funds and Total

Assets

2005 2006 2007 2007 Group

2008 2008 Group

2009 2009 Group

MR

F

Earnings per share

Dividend per share

Earnings per Share and Dividend per

Share

25

0

-25

-50

-75

50

75

100

125

150

175

200

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MTCCANNUAL REPORT2009Financial Statements

2005 2006 2007 2007 Group

2008 2008 Group

2009 2009 Group

5%

0%

10%

15%

20%

25%

30%

Per

cent

Dividend Yield

Operating Return on Equity

Dividend Yield and Operating Return

on Equity

2005 2006 2007 2007 Group

2008 2008 Group

2009 2009 Group

200

0

400

600

800

1,000

1,200

MR

F

1,400

1,600

Average market price

Net Assets Value per share

Average Market Price and Net

Assets

Value per Share

2002 2003 2004 2005 2006 2007 2008 2009

100

0

200

300

400

500

600

MR

F

50

150

250

350

450

550

650

180

Share Price movement

20


Corporate

MR. HUssAiN HiLMyChairman

Former Minister of Fisheries and Agriculture, and Minister of Youth and Sports, Mr. Hussain Hilmy who has also served in various other government posts, is also an experienced businessman in the tourism industry of Maldives. He is also Assistant Secretary General of Maldives Association of Tourism Industry and has also served as a Board Member of the Association, as well as a Presidents Member in the Peoples Majlis of Maldives. He was appointed as the Chairman of MTCC’s Board of Directors on 4th February 2009.

Board of Directors

MR. MOHAMED sHAFEEQActing Chief Executive Officer

Mr.Mohamed Shafeeq holds a Bachelors Degree in Architectural Studies and is an expert in the field. He was appointed to the Board of Directors on 17th January 2010.

20

MTCCANNUAL REPORT

2009

Corporate

21


Corporate

MR. ABDULLA sHAAiRUDirector

A Private Practitioner, Mr. Abdulla Shaairu holds a diploma in Shariah and Law. He has experience representing private parties and businesses in both lower court as well as the high court. Mr. Abdulla Shaairu who has also served as a member of Social Housing Committee was appointed to MTCC’s Board of Directors on 4th February 2009.

MR. ABDULLA NAUsHADDirector

Mr. Abdulla Naushad, an expert in the field of Civil Engineering is the Managing Director of Development Collaborative Partnership. He holds a Bachelors Degree in Civil Engineering. Mr. Abdhulla Naushad has contributed in different infrastructure development projects of the Maldives. He has also served as a U.N. Specialist Engineer for Department of Infrastructure and Public Utilities of Tobago House of Assembly, Republic of Trinidad and Tobago, which involves overseeing of Development projects in the Country. Mr. Abdulla Naushad was appointed as a member of MTCC’c Board of Directors on 4th February 2009.

MR. ABDUL NAsiR MOHAMEDDirector

Deputy Director General of Housing Transport and Environment, Mr. Abdul Nasir Mohamed holds a Higher National Diploma in Nautical Science and has vast experience in the field. Appointed as MTCC’s Board of Directors on 4th February 2009, Mr. Abdul Nasir Mohamed has 20 years experience and served in different posts in the Shipping Industry.

MR. HUssAiN HAALyDirector

With more than 15 years experience in private trading sector, Mr. Hussain Haaly holds a diploma in Information Technology. Elected as member of MTCC’s Board of Directors on 27th August 2005, Mr. Hussain Haaly is also the Operations Manager of Fortsen Shades. He is also a member of the Board of Directors of Maldives Real Estate Investment Corporation.

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MTCCANNUAL REPORT

2009

Corporate

MR. AMEEN iBRAHiMDirector

Mr. Ameen Ibrahim holds a Masters Degree in Management. Currently the Chief Executive Officer of Villa Television, Mr. Ameen Ibrahim has served in various Senior Government positions. This includes Deputy Minister of Ministry of Gender and Family and Deputy Executive Director of MNCB. He also has served as the Secretary General of MACI and is a Director and Shareholder of Politan Maldives Pvt Ltd. Mr. Ameen Ibrahim has a vast experience in providing management consultancy in establishing new companies, and is also a member of National Educational Committee.He was elected as a member of MTCC’s Board of Directors ion 25th June 2006.

MR. MANsOOR ZUBAiRDirector

Mr. Mansoor Zubair holds a Bachelors Degree in Commerce and was elected to MTCC Board of Directors on 29th April 2009. He is currently a Manager of Maldives Monetary Authority and is also a technical member of the Editorial Committee of MMA, Technical Member of Macro Coordinating Committee of Ministry of Finance And Treasury and a representative member of MMA to Customs Services Valuation Committee.

MR. ALi sHAFEEUDirector

Mr. Ali Shafeeu holds a Bachelors Degree in Accounting and he is a Senior Officer of Maldives Airports Company Ltd. where he has been serving for more than 12 years. He is also a Director and Shareholder of Holism Private Limited. Mr. Ali Shafeeu elected to the Board of Directors on 19th August 2009.

Ms. sHAFEENAZ ABDUL sATTARDirector

Currently working as a free lance consultant, Ms. Shafeenaz Abdul Sattar holds a Masters Degree in Commerce. With 10 years experience in Maldives Monetary Authority, she has also contributed in different national level projects. She was appointed as a member of MTCC’s Board of Directors on 4th February 2009.

23

MTCCANNUAL REPORT

2009

Corporate

Senior Management23


Corporate

Ms. Abida RasheedMs. Abida Rasheed, Executive is the head of Administration Department. She joined MTCC in 1983. She has acquired vast experience in the field of Management and participated in various training programs, workshops both locally and overseas. She had previously headed Rentals and Auctions Department, Share Section, Human Resources Department and Marketing Department.

Mr. PM. sakthivelMr. PM. Sakthivel, Internal Audit Executive is the Head of Finance and Management Audit Department. He joined MTCC in 1999 and holds a Masters Degree in Commerce from Annamaali University, India. He has acquired 10 years of experience as a Commerce Officer and ISO coordinator.

Ms. Leela AhmedMs. Leela Ahmed, Chief Financial Officer is the head of Finance Department since 28 March 2010. Ms. Leela Ahmed joined MTCC in 1995. She has a Bachelors Degree (Honors) in Accounting and Finance from Middleexes University, London and a part qualification in Association of Chartered Certified Accountants from Sunway University, Malaysia.

Mr. Abdulla Thasleem Abdul HakeemMr. Abdulla Thasleem Abdul Hakeem, Executive is the head of Construction and Projects Management Department since 24 November 2009. Mr. Abdulla Thasleem Abdul Hakeem joined MTCC in 1999. He holds a Master Degree in Construction Management from Loboro University, England and a Bachelors Degree in Planning and Design (Property and Construction) from University of Melbourne, Australia. He had achieved the “Deens Honours Award 2005” from Building and Planning, Faculty of Arts, University of Melbourne , Australia.

Mr. Ahmed NaseemMr. Ahmed Naseem, Executive is the head of Human Resources Department since 28 March 2010. Mr. Ahmed Naseem joined MTCC in 1999. He holds an Honours Degree in Computer Networking from Coventry University, England.

Mr. shifau AliMr. Shifau Ali, Executive, is the head of Procurement Department since 28 March 2010. He joined MTCC in 2007 and he holds a Honors Degree in Accounting and Finance from University of East London, UK.. He has participated in various training programs both locally and overseas in the field of Procurement and Logistics Management.

Mr. ismail FaariqMr. Ismail Faariq, Executive, is the Head of Business Development Department since 26 April 2010. He joined MTCC in 2001 and he has also previously headed Rentals and Auctions Department. He holds a Bachelors Degree in Business Management (Marketing) from University of Queensland, Australia.

Mr. Hamid Nasheed MohamedMr. Hamid Nasheed Mohamed, Executive is the head of Information Communication and Technology Department. He joined MTCC in 1995 and had previously headed Human Resources Department, Rentals and Auctions Department. Mr. Hamid Nasheed Mohamed has completed a Certificate in Programming Course from Institute of Adelaide TAFE, Australia and has acquired vast experience by participating in various training program and conferences both locally and overseas.

24


Corporate

s

Mr. Hussain shaheed, Mr. Hussain Shaheed, Executive is the head of Building Services Security Department since 26 April 2010. Mr. Hussain Shaheed joined MTCC in 2004 and holds a Bachelors Degree in Civil Engineering from Curtains University, Australia and also has acquired various trainings and experience in the field of the Engineering and Management from both locally and overseas. Mr. Hussain Shaheed had previously headed Contracting Department and MTCC’s fully owned subsidiary Company, Maldives Real Estate Investment Corporation Pvt Ltd.

Mr. Hamid NaseemMr. Hamid Naseem, Executive, is the head of Engineering Department since 28 March 2010. Mr. Hamid Naseem joined MTCC in 1997 and he holds a Bachalors Degree in Mechanical Engineering from Bradford University, England and has participated in various training programs both locally and overseas.

Ms. Hawwa HuzaimaMs. Hawwa Huzaima, Executive is the Head of Transport Department, She joined MTCC in 2000. She has previously headed Procurement and Supplies Department and had also been the Asst. General Manager of MTCC’s fully owned subsidiary company Maldives Real Estate Investment Corporation Pvt Ltd. She holds a a Bachalors Degree in Accounting and Finance from Griffith University, Australia.

Ms. sheereen NaseemMs. Sheereen Naseem, Executive, is the Head of Corporate Department and the Company Secretary of MTCC. She is also the Company Secretary of MTCCs 100% Subsidiary Company Maldives Real Estate Investment Corporation Pvt Ltd. Ms.Sheereen Naseem joined MTCC in 1981 and has acquired various experience and training in the fields of Company Secretary and Management both locally and overseas.

Ms. Fathimath LiushaMs. Fathimath Liusha, Manager who joined MTCC in 1997 holds a Bachelor of Honours Degree in International Business Administration from University of Northumbria, UK. She is temporarily incharge of Legal Department since 26th March 2009.

Mr. ihusaan shareefMr. Ihusaan Shareef, Executive is the Head of Trading Department. He joined MTCC in 1999. He holds a Bachalors of Science Degree in Botany from University of Madras, India. In addition to overseeing the operation of Sales and Marketing Department, he had been the in charge to oversee the operation of Rentals and Auction Department.

Ms. Aishath suzan HaneefMs. Aishath Suzan Haneef, Executive joined MTCC in 2000. She holds a Masters Degree in Business Administration with Marketing from University of Southern Queensland, Australia. and a Bachelor of Honours Degree in Business Adminitration with International Business from University of East London, UK. Ms.Aishath Suzan Haneef has previously headed Marketing Department, Rentals Department and Corporate Department.

Mr. Usman HafeezMr. Usman Hafeez, Executive is the head of Logistical Operations Department. He joined MTCC in 1985. Mr. Usman Hafeez has acquired various management trainings in the field of Quality Assurance and has previously headed Finance Department, Corporate Department, Contracting Department and Procurement and supplies department.

25


Corporate

s

Name of the Company Maldives Transport & Contracting Company Plc

Legal Status Registered at Ministry of Economic Development as a public company with limited liability under Company’s Law No. 10/96.

Registered Office MTCC Tower, Boduthakurufaanu MaguMale’ 20057, Republic of MaldivesPhone: 3326822Fax: 3323221Email: [email protected] site: www.mtcc.com.mv

Registration no. and Date Reg. No.: 680 Date: 18 December 1980.

Company SecretaryMs. Sheereen Naseem.

Corporate Information

Government of Maldives of Mrf.50.00 131,289 6,564,450 52.5

General Public of Mrf.50.00 100,000 5,000,000 40.0

MNSL of Mrf 50.00 18,711 935,550 7.5

Total 250,000 12,500,000 100.0

No. of SharesValue (Mrf)No. of sharesshare structure

26

MTCCANNUAL REPORT

2009

Corporate

Bankers, Auditors & LawyersBankersBANk OF MALDivEs PLCBoduthakurufaanu Magu, Male’ 20094, Maldives Phone: +960 332 2948 Fax: +960 332 8233 Email: [email protected] Website: www.bml.com.mv

HsBC LiMiTED MTCC Tower, 1st Floor, Boduthakurufaanu Magu, Male’ 20057, MaldivesPhone: +960 333 0770 Email: [email protected] Website: www.hsb.com.lk

HABiB BANk LiMiTED Ship Plaza, Orchid Magu, Male’ 20183, MaldivesPhone: +960 332 2051Fax: +960 3326791 Email: [email protected]

Website: www.habibbankltd.com

sTATE BANk OF iNDiAH.Sunleet, Gadhage Mohamed Fulhu Building, Boduthakurufaanu Magu, Male’, MaldivesPhone: 331 2111Fax: 332 3053Email: [email protected]: www.onlinesbiglobal.com

BANk OF CEyLONAage, Boduthakurufaanu Magu, Male 20094, MaldivesPhone: 331 4764Fax: 332 0575Email: [email protected]: www.boc.lk

AuditorsiNTERNAL – PRiCEwATERHOUsECOOPERsAage, 2nd Floor, 12, Boduthakurufaanu Magu, Male’, MaldivesPhone: +960 331 8342Fax: +960 333 6046Email: [email protected]

ExTERNAL – ERNsT & yOUNg G.Soasanee, 1st Floor, Rahdhebai Magu, Male’, MaldivesPhone: +960 332 0742Fax: +960 332 0748Email: [email protected]

LawyersvAkAALAATH CHAMBERsOrchidmaage, 2nd FL, Ameer Ahmed Magu, Male’, MaldivesPhone: +960 792 8122 +960 7462770Email: [email protected]

27


Corporate

Department’s Contact InformationCORPORATE DEPARTMENTMTCC Tower 7th Floor, Boduthakurufaanu Magu, Male’Post Code: 20057 Phone: +960 332 6822Fax: +960 332 3221Email: [email protected]

FiNANCE DEPARTMENTMTCC Tower 3rd Floor, Boduthakurufaanu Magu, Male’Post Code: 20057 Phone: +960 332 6822Fax: +960 331 5500Email: [email protected]

BUsiNEss DEvELOPMENT DEPARTMENTMTCC Tower 3rd Floor, Boduthakurufaanu Magu, Male’Post Code: 20057 Phone: +960 332 6822Fax: +960 332 3221Email: [email protected]

CONsTRUCTiON AND PROJECTMANAgEMENT DEPARTMENTMTCC Tower 6th Floor, Boduthakurufaanu Magu, Male’Post Code: 20057 Phone: +960 332 6822Fax: +960 333 2835Email: [email protected]

PROCUREMENT DEPARTMENTH.Sawmill, Filigas Magu, Male’Post Code: 20013 Phone: +960 332 6822Fax: +960 331 5005Email: [email protected]

ENgiNEERiNg DEPARTMENTK.ThilafushiPhone: +960 664 0664Fax: +960 664 0523Email: [email protected]

TRADiNg DEPARTMENTH.Sawmill, Filigas Magu, Male’Post Code: 20013 Phone: +960 332 0045Fax: +960 332 3022Email: [email protected]

LEgAL DEPARTMENTMTCC Tower 7th Floor, Boduthakurufaanu Magu, Male’Post Code: 20057 Phone: +960 332 6822Fax: +960 332 3221Email: [email protected]

iNTERNAL AUDiT DEPARTMENTH.Sawmill, Filigas Magu, Male’Post Code: 20013 Phone: +960 332 6822Fax: +960 334 6806Email: [email protected]

HUMAN REsOURCEs DEPARTMENTMTCC Tower 2nd Floor, Boduthakurufaanu Magu, Male’Post Code: 20057 Phone: +960 332 6822Fax: +960 334 3937Email: [email protected]

iNFORMATiON COMMUNiCATiON TECHNOLOgy DEPARTMENTMTCC Tower 5th Floor, Boduthakurufaanu Magu, Male’Post Code: 20057 Phone: +960 332 6822Fax: +960 330 4542Email: [email protected]

BUiLDiNg sERviCEs AND sECURiTyDEPARTMENTDhathuruvehi 3, Boduthakurufaanu Magu, Male’Post Code: 20057 Phone: +960 334 6051Fax: +960 334 4924Email: [email protected]

TRANsPORT DEPARTMENTDhathuruvehi 3, Boduthakurufaanu Magu, Male’Phone: +960 331 5050Fax: +960 332 2808Email: [email protected]

LOgisTiCAL OPERATiONs DEPARTMENTK.ThilafushiPhone: +960 332 6822Fax: +960 332 3221Email: [email protected]

ADMiNisTRATiON DEPARTMENTMTCC Tower 7th Floor, Boduthakurufaanu Magu, Male’Post Code: 20057 Phone: +960 332 6822Fax: +960 332 3221Email: [email protected]

Financial Statements

29


Corporate

Auditor’s ReportStatement of Comprehensive Income Consolidated Statement of Financial PositionConsolidated Statement of Changes in EquityStatement of Cash FlowNotes to Financial StatementsDirectors’ ShareholdingsFinancial Highlights of 10 Years

3

3032333435365960

30

MTCCANNUAL REPORT

2009Financial

Statements

Auditor’s Report

INDEPENDENT AUDITORS’ REPORT TO THE SHAREHOLDERS OF MALDIVES TRANSPORT AND CONTRACTING COMPANY PLC

We have audited the accompanying financial statements of Maldives Transport and Contracting Company PLC (‘Group’), which comprise the consolidated statement of financial position as at 31 December 2009 and the consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated cash flow statement for the year then ended, and the summary of significant accounting policies and other explanatory notes.

This report is made solely to the company’s members, as a body, in accordance with section 71 of the Companies Act no.10 of 1996. Our audit work has been undertaken so that we might state to the company’s members those matters we are required to state to them in an auditors’ report and for no other purpose. Therefore, we do not accept or assume responsibility to anyone other than the company and company’s members as a body, for our audit work, for this report, or for the opinions we have formed.

Management’s responsibility for the financial statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards. This responsibility includes; designing, implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting statements that are reasonable in the circumstances.

Auditors’ responsibility

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

An audit involves performing procedures to obtain audit evidence about the amount and disclosures in the financial statements. The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate for the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used in the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

31


Subject to the limitations resulting from notes 1,2,3 and 4 mentioned below, we believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

1. Capital work-in-progress of the group at the balance sheet date represent expenditure incurred on reclamation of land in islands, Sh.Funadhoo, Dh.Kudahuvadhoo, Th.Thimarafushi and G.Dh Maavehdhoo for development of regional airports carried out by Airport Investments Maldives Private Limited, which is a joint venture of the company. The reclamation process had been discontinued in islands Sh.Funadhoo, Dh.Kudahuvadhoo, Th.Thimarafushi during the year 2009 due to lack of funds except G.Dh Maavehdhoo where some reclamation work was carried out. In the absence of documentary evidence in the form a of plan of action for development of regional airports in the respective islands, we are unable to conclude whether the capital work-in-progress of Rf 26,180,796/- (proportion consolidated Rf 8,726,932/-) shown in the balance sheet is fairly stated.

2. Other receivables belonging to the joint venture at the balance sheet date includes calls-in-arrears amounting Mrf 3,500,000/- (proportion consolidated Rf 1,166,667/-) from a shareholder, Island Aviation Services Limited, which has been outstanding for more than a year and therefore, doubtful of recovery. In the absence of balance conformation from the shareholder, we are unable to satisfy our selves whether the amount shown under other receivable in the balance sheet is recoverable.

3. Trade and other receivables belonging to Airport Investments Maldives Private Limited (Joint Venture) includes Rf 6,315,169/- ( proportion consolidated Rf 2,105,056/-) remaining as a balance for over a year from the total advance paid to the contractor after offsetting for value of work certified by consultants. The recoverability of this amount is doubtful.

4. The company has not carried out an impairment review of its investment in Airport Investments Maldives Private Limited (AIM) despite significant doubts about its ability to continue as going concern.

Opinion

In our opinion, except for the effects of such adjustments that might have been determined to be necessary had we been able to satisfy ourself as to the matters referred to in above notes 1, 2, 3 and 4, the consolidated financial statements present fairly, in all material respects, the financial position of the group as of 31 December 2009, and of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards.

Emphasis of Matters

Without further qualifying our opinion, we draw attention to note 1.3 in the financial statement.

20th July 2010Male’

32

MTCCANNUAL REPORT

2009Financial

Statements

Statement of Comprehensive Income

COMPANY GROUP

Note 2009 2008 2009 2008 Restated Restated

Revenue 5 474,340,631 684,337,588 473,428,464 684,439,753

Cost of goods sold (365,352,276) (543,442,068) (365,637,524) (543,498,451)

Grossprofit 108,988,355 140,895,520 107,790,939 140,941,302

Other income 3,871,310 7,243,657 3,871,310 7,243,657

Selling and distribution expenses (31,600,959) (14,005,285) (31,600,959) (21,095,838)

Administrative expenses (63,842,665) (73,334,025) (64,551,029) (74,316,273)

Other expenses (7,021,364) (7,994,112) (7,021,364) (7,994,112)

Operatingprofit 6 10,394,677 52,805,755 8,488,898 44,778,736

Finance costs 6.3 (22,750,016) (19,040,775) (22,750,016) (19,040,775)

Profitfortheyear (12,355,339) 33,764,980 (14,261,118) 25,737,961

Earnings per share 8 (49.42) 135.06 (57.04) 102.95

The accounting policies and notes on pages 36 through 58formanintegralpartofthefinancialstatements.

All amounts in Maldivian RufiyaaAs at 31 December 2009

20 July 2010

33


COMPANY GROUP


AssetsNon-current assetsProperty, plant and equipment 9 222,609,795 248,596,182 222,769,957 248,758,058 Capital work-in-progress 10 12,873,127 11,836,151 22,531,186 19,296,339 Investment properties 11 33,273,838 35,411,119 33,273,838 35,411,119 Intangible assets 12 2,245,055 3,072,023 2,261,668 3,094,841 Assets held for sale 552,800 - 552,800 -Financial investments 13 48,031,520 54,604,400 35,929,020 42,501,900 Trade and other receivables 14 3,271,748 4,571,139 67,521,748 68,821,139 Total non-current assets 322,857,883 358,091,014 384,840,217 417,883,396

Current assetsInventories 15 135,911,034 140,184,790 135,911,034 140,184,790 Goods in transit 3,057,062 - 3,057,062 -Trade and other receivables 14 192,159,494 207,988,453 191,158,597 207,618,715 Cash and cash equivalents 16 7,780,920 11,351,245 9,228,878 13,356,803 Total current assets 338,908,509 359,524,488 339,355,571 361,160,308 TOTAL ASSETS 661,766,392 717,615,502 724,195,788 779,043,704

Equity and LiabilitiesEquityShare capital 17 12,500,000 12,500,000 12,500,000 12,500,000 General reserve 152,039,082 136,778,922 152,039,082 136,778,922 Fair value reserve 23,902,218 30,475,098 23,902,218 30,475,098 Retained earnings 115,669,172 155,784,671 105,039,936 147,061,214 Total equity 304,110,472 335,538,691 293,481,236 326,815,234

LiabilitiesNon-current liabilitiesBorrowings 18 45,656,637 69,384,897 45,656,637 69,384,897 Trade payables 19 4,434,479 5,063,991 81,106,146 77,452,325 Total non-current liabilities 50,091,116 74,448,888 126,762,783 146,837,222

Current liabilitiesBorrowings 18 169,270,946 142,043,217 169,270,946 142,043,217 Trade and other payables 19 138,293,858 165,584,706 134,680,823 163,348,031 Total current liabilities 307,564,804 307,627,923 303,951,769 305,391,248 Total liabilities 357,655,920 382,076,811 430,714,552 452,228,470 TOTAL EQUITY AND LIABILITIES 661,766,392 717,615,502 724,195,788 779,043,704

Consolidated Statement of Financial Position

Theboardofdirectorsisresponsibleforthepreparationandpresentationofthesefinancialstatements.Signed for and on behalf of the Board by,

Hussain Hilmy Mohamed Shafeeq Chairman ActingChiefExecutiveOfficer Theaccountingpoliciesandnotesonpages36through58fromanintegralpartofthefinancialstatements.


20 July 2010

34

MTCCANNUAL REPORT

2009Financial

Statements

COMPANY

Share Capital General Reserve

Fair Values & Other Reserves

Retained Earnings Total

Balance at 1 January 2008 12,500,000 136,778,922 51,289,218 133,269,691 333,837,831 Net fair value loss on available-for salefinancialassets - - (20,814,120) - (20,814,120)

Dividend relating to 2007 - - - (11,250,000) (11,250,000)

Profitfortheyear(Restated) - - - 33,764,980 33,764,980

Balance at 31 December 2008 12,500,000 136,778,922 30,475,098 155,784,671 335,538,691

Balance at 1 January 2009 12,500,000 136,778,922 30,475,098 155,784,671 335,538,691

Net fair value loss on available-for salefinancialassets - - (6,572,880) - (6,572,880)


Profitfortheyear - - - (12,355,339) (12,355,339)

Transferred to general reserve - 15,260,160 - (15,260,160) -


GROUP

Share Capital General Reserve

Fair Values & Other Reserves

Retained Earnings Total



Profitfortheyear(Restated) - - - 25,737,961 25,737,961




Loss for the year - - - (14,261,118) (14,261,118)

Transferred to general reserve - 15,260,160 - (15,260,160) -


Consolidated Statement of Changes in Equity

Theaccountingpoliciesandnotesonpages36through58fromanintegralpartofthefinancialstatements.


20 July 2010

35


Statement of Cash Flow

COMPANY GROUP


Operating activities

Profit/(loss)fortheyear (12,355,339) 33,764,980 (14,261,118) 25,737,961

Adjustments for:

Depreciation and amortization 66,608,804 62,593,639 66,671,587 62,642,815

Loss/(gain)onsaleofproperty,-plantand equipment (570,626) 29,550 (570,626) 29,550

Provision for impairment 26,803,278 7,673,674 26,803,278 14,741,174

Impairmentoffixedassets 431,022 - 431,022 -

Provision slow moving items 2,032,753 1,635,173 2,032,753 1,635,173

Investment income (2,791,052) (3,347,460) (2,791,052) (3,347,460)

Interest income (509,632) (1,786,615) (509,632) (1,786,615)

Interest expense 20,112,233 16,143,222 20,112,233 16,143,222

Working capital adjustments:

Decrease/(increase)intradeandotherreceivables (9,674,928) (66,133,145) (9,043,768) (66,182,602)

Decrease/(increase)ininventories (816,059) (7,570,635) (816,059) (7,570,635)

(Decrease)/increaseintradeandotherpayables (34,171,209) 6,901,187 (31,264,236) 9,663,876

Netcashflowsfromoperatingactivities 55,099,245 49,903,570 56,794,381 51,706,459

Investing activities

Purchase of property, plant and equipment (32,973,520) (66,074,751) (33,028,386) (66,143,102)

Expenditure on capital work-in-progress (7,326,901) (5,107,354) (9,524,772) (12,557,542)

Proceeds from sale of property, -plant and equipment 1,192,081 38,032 1,192,081 38,032

Advance given to contractor - - - (3,945,732)

Interest received 509,632 1,786,615 509,632 1,786,615

Dividends received 2,791,052 3,347,460 2,791,052 3,347,460

Netcashflowsusedininvestingactivities (35,807,656) (66,009,998) (38,060,393) (77,474,269)

Financing activities

Repayment of capital in arrears - (1,500,000) - -

Received from calls in-arrears - - - 166,667

Proceeds from borrowings 38,955,336 112,546,669 38,955,336 112,546,669

Repayments of borrowings (46,592,041) (68,296,719) (46,592,041) (68,296,719)

Advance payment received to provide the sub-leasehold right - - - -

Interest paid (20,112,233) (16,143,222) (20,112,233) (16,143,222)

Dividends paid to company's shareholders (6,249,150) (11,250,000) (6,249,150) (11,250,000)

Netcashflowsgeneratedfrom/(usedin) financingactivities (33,998,088) 15,356,728 (33,998,088) 17,023,395

Net decrease in cash and cash equivalents (14,706,499) (749,700) (15,264,100) (8,744,415)

Cash and cash equivalents at 1 January (90,932,626) (90,182,926) (88,927,067) (80,182,652)

Cash and cash equivalents at 31 December 16 (105,639,125) (90,932,626) (104,191,167) (88,927,067)

Theaccountingpoliciesandnotesonpages36through58fromanintegralpartofthefinancialstatements.


20 July 2010

36

MTCCANNUAL REPORT

2009Financial

Statements

Notes to Financial Statements

1. Corporate information

1.1 GeneralThese consolidated financial statements relate to the operations of Maldives Transport and Contracting Company Plc (‘the Company’) and its subsidiary and joint venture (together ‘the Group’). It is a public limited liability company incorporated in the Republic of Maldives under the Act 4/81 on 18 December 1980. The Company was re-registered with the Ministry of Trade and Industries on 12 February 1990.

1.2 Principal activities and nature of operationsThe principal activities undertaken by the Company include trading contracting, marine transportation, renting of buildings, construction equipment and machinery, and auctioning.The address of its registered office is MTCC Building, Boduthakurufaanu Magu, Male’ 20181, Republic of Maldives. The Company’s shares are listed on the Maldives stock exchange.

1.3 Going concernThe Directors have made an assessment of the Company’s and its Subsidiaries ability to continue as a going concern and they do not intend either to liquidate or to cease trading.

However, Maldives Real Estate Investment Corporation Private Limited and Airport Investments Maldives Private Limited for the year ended 31 December 2009 has incurred a net loss of Mrf 120,053/- and Mrf 967,115/- (2008 – Mrf 7,285,048/- loss and Mrf 741,971/- loss) respectively, and accumulated loss of Mrf 7,729,977/- and Mrf 2,080,648/- (2008 – Mrf 7,609,924/- loss and Mrf 1,150,200/- loss) respectively as at 31 December 2009.

Further, Maldives Real Estate Investment Corporation Private Limited’s net current liabilities exceed its current assets by Mrf 2,460,607 /- and its total liabilities exceed its total assets by Mrf 627,477/-. These factors raise substantial doubt that Maldives Real Estate Investment Corporation Private Limited will be able to continue as a going concern.

2. Summary of significant accounting policiesThe principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied over the years, unless otherwise stated.

2.1 Basis of preparationThe financial statements are prepared in accordance with and comply with International Financial Reporting Standards (IFRS). These financial statements are prepared under the historical cost convention, whereby the transactions are recorded at the value prevailing on the dates when the assets were acquired, the liabilities were incurred or the capital obtained.The financial statements of Maldives Transport and Contracting Company Plc for the period ended 31 December 2009 were authorized for issue in accordance with a resolution of Board of Directors dated 20 July 2010.

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2.2 Consolidation

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

b) Joint ventures The Group’s interests in jointly controlled entities are accounted for by proportionate consolidation.

2.2 ConsolidationThe Group combines its share of the joint ventures’ individual income and expenses, assets and liabilities and cash flows on a line-by-line basis with similar items in the Group’s financial statements.

Joint ventures The Group recognises the portion of gains or losses on the sale of assets by the Group to the joint venture that is attributable to the other ventures. The Group does not recognise its share of profits or losses from the joint venture that result from the Group’s purchase of assets from the joint venture until it resells the assets to an independent party. A loss on the transaction is recognised immediately if it provides evidence of a reduction in the net realisable value of current assets, or an impairment loss. Joint ventures’ accounting policies have been changed where necessary to ensure consistency with the policies adopted by the Group.

2.3 Segment reporting A business segment is a group of assets and operations engaged in providing products or services that are different from those of other business segments. A geographical segment is engaged in providing products or a service within a particular economic environment that are subject to risks and returns that are different from those of segments operating in other economic environments.

2.4 Foreign currency translation

a) Functional and presentation currencyItems included in the financial statements of entity are measured using the currency of the primary economic environment in which the entity operates (‘the functional currency’). The consolidated financial statements are presented in Maldivian Rufiyaa which is the Group’s functional and presentation currency.

b) Transactions and balances Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement, except where hedge accounting is applied.

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MTCCANNUAL REPORT

2009Financial

Statements

2.5 Property, plant and equipmentAll property, plant and equipment, which are initially recorded at historical cost, are stated at cost less depreciation. Cost includes the transfer value of the assets, or their purchase cost, or the cost of construction, together with any incidental expenses of acquisition.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance costs are charged to the income statement during the financial period in which they are incurred.

Depreciation is calculated using the straight-line method to allocate their cost or revalued amounts to their residual values over their estimated useful lives, commencing from the month in which the assets were purchased up to the date of disposal, as follows:

Buildings (other than MTCC tower) 10 years MTCC tower 25 years Plant and Machinery 5 years Motor vehicles other than dredging vehicles 5 years Dredging vehicles 5 years Excavators 5 years Dump trucks 3 years Wheel loader 3 years Crane 3 years Furniture and fittings 6.67 years Office equipment 5 years Vessels (other than tug) 10 years Tug 7 years Tools 3 years Sundry assets 5 years

When values of acquisitions are less than Mrf. 5,000/- those assets are depreciated fully in the year of acquisition irrespective of their useful lifetime.

The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.

Buildings constructed on leasehold land and improvements made to leasehold premises are amortised over the unexpired period of the lease.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with carrying amount. These are included in the income statement.

2.6 Investment propertiesInvestment properties are measured initially at cost, including transaction costs. The carrying amount includes the cost of replacing part of an existing investment property at the time cost is incurred if the recognition criteria are met; and excludes the costs of day to day servicing of an investment property. Gains or losses arising from changes in the fair values of investment properties are included in the profit or loss in the year in which they arise.

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Investment properties are derecognized when either they have been disposed of or when the investment property is permanently withdrawn from use and no future economic benefit is expected from its disposal. Any gains or losses on the retirement or disposal of an investment property are recognized in profit or loss in the year of retirement or disposal.

Transfers are made to or from investment property only when there is a change in use. For a transfer from investment property to owner occupied property, the deemed cost for subsequent accounting is the fair value at the date of change in use. If owner occupied property becomes an investment property, the Group accounts for such property in accordance with the policy stated under property, plant and equipment up to the date of change in use.

No assets held under operating lease have been classified as investment properties.

2.7 Intangible assetComputer software development costs recognised as assets are amortised using the straight-line method over their estimated useful lives (not exceeding five years). The carrying amount of each intangible asset is reviewed annually and adjusted for permanent impairment where it is considered necessary.

2.8 Assets held for saleNon current assets classified as held for sales are measured at the lower of carrying amount and fair value less cost to sell. Non current assets are classified as held for sale if the carrying value will be recovered trough a sales transaction rather than trough continuing use. This condition is regarded as met only when the sales are highly probable and the assets are available for immediate sales in its present condition. Management must commit to sale which should be expected to qualify for recognition as a completed sale within one year from the classification.Property plant and equipment once classified as held for sales are not depreciated.

2.9 Impairment of non-financial assetsAssets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment. Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount.

The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (cash-generating units). Non-financial assets that suffered impairment are reviewed for possible reversal of the impairment at each reporting date.

2.10 Financial assetsThe Company classifies its financial assets in the following categories. The classification depends on the purpose of which the financial assets were acquired. The management determines the classification of its financial assets at initial recognition and re-evaluates this designation at every reporting date.

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MTCCANNUAL REPORT

2009Financial

Statements

a) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the balance sheet date. These are classified as non-current assets. Loans and receivables are classified as “trade and other receivables” in the balance sheet. The Company assesses at each balance sheet date whether there is objective evidence that a financial asset is impaired.

b) Financial investments Financial investments are non-derivatives that are either designated in this category or not classified in any other categories. They are included in non-current assets, unless management intend to dispose of the investment within 12 months of the balance sheet date.

When securities classified as financial investments are sold or impaired, the accumulated fair value adjustments recognised in equity are included in the income statement as ‘gains and losses from investment securities’. Dividends on available-for-sale equity instruments are recognised in the income statements, when the Company’s right to receive payments is established. The fair values of quoted investments are based on current bid prices. If the market for the financial asset is not active (and for unlisted securities), the Company establishes fair value by using valuation techniques.

These include the use of recent arm’s length transactions, reference to other instruments that are substantially the same, discounted cash flow analysis and option pricing models, making maximum use of market inputs and relying as little as possible on entity-specific inputs. Wherever these techniques cannot give reliable fair price, the price of unlisted securities is established at cost. The Company assesses at each balance sheet date whether there is objective evidence that a financial asset or a group of financial assets is impaired. In the case of equity securities classified as financial investments, a significant or prolonged decline in the fair value of the security below its cost is considered an indicator that the securities are impaired. If any such evidence exists for financial investments, the cumulative loss - measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit or loss - is removed from equity and recognised in the income statement. Impairment losses recognised in the income statement on equity instruments are not reversed through the income statement.

2.11 InventoriesInventories are stated at the lower of cost and net realisable value. Cost is determined using the first-in, first-out (FIFO) method and includes import duty, insurance, freight, port charges and bank charges. The cost does not include borrowing cost. Net realisable value is the estimated selling price in the ordinary course of business less applicable variable selling expenses.

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2.12 Construction contracts The profit on a construction contract is recognised as soon as it can be estimated reliably. The Company uses the percentage of completion method to determine the appropriate amount to recognize in a given period; the stage of completion is measured by reference to work done to total work undertaken for each contract. Losses are recognised as soon as the loss is foreseen. The full amount of the anticipated loss, including any loss related to future work on the contract, is recognised in the period in which the loss is identified.

In determining cost incurred up to year end, any costs relating to future activity on a contract are excluded and shown as contract work in progress. The aggregate of the cost incurred and the profit/ loss recognised on each contract is compared against the progress billings up to the year end. Where the sum of the costs incurred and recognised profit or loss exceeds the progress billings, the balance is shown under receivables and prepayments as due from customers on contracts.

2.13 Trade receivables Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of receivables. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The amount of the provision is recognised in the income statement within ‘selling and marketing costs’.

2.14 Cash and cash equivalents Cash and cash equivalents include cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the balance sheet.

2.15 Share capital Ordinary shares are classified as equity.

2.16 Borrowings Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently stated at amortised cost; any difference between the proceeds (net of transaction costs) and the redemption value is recognised in the income statement over the period of the borrowings using the effective interest method.

Borrowings are classified as current liabilities unless the Company has an unconditional right to difer settlement of the liability for at least 12 months after the balance sheet date.

2.17 Employee benefits Amounts contributed by the Company to the employee’s provident fund under a voluntary or a compulsory scheme are treated as a staff cost.

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MTCCANNUAL REPORT

2009Financial

Statements

2.18 Provisions Provisions are recognised when: the Company has a present legal or constructive obligation as a result of past events; it is more likely than not that an outflow of resources will be required to settle the obligation; and the amount has been reliably estimated. Provisions are not recognised for future operating losses.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small.

Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a rate that reflects current market assessments of the time value of money and the risks specific to the obligations.

2.19 Revenue recognition Revenue comprises the fair value of the sale of goods and services, net of discounts. Revenue is recognised as follows:

a) sales of goods - retail Sales of goods are recognised when the Company has delivered products to the customer; the customer has accepted the products; and collectability of the related receivables is reasonably assured.

b) sales of services Sales of services are recognised in the accounting period in which the services are rendered, by reference to completion of the specific transaction, assessed on the basis of the actual service provided as a proportion of the total services to be provided.

c) interest income Interest income is recognised on a time-proportion basis using the effective interest method.

d) Dividend income Dividend income is recognised when the right to receive payment is established.

e) Rental income Rental income is recognised on an accrual basis in accordance with the substance of the relevant agreement.

2.20 Leases

a) The Company is the lessee Leases where the lessor retains substantially all the risks and rewards of ownership are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease.

b) The Company is the lessor Assets leased to third parties under operating leases are included in property, plant and equipment in the balance sheet. They are depreciated over their expected useful lives on a basis consistent with similar owned property, plant and equipment. Rental income (net of any incentives given to lessees) is recognised on a straight-line basis over the lease term.

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2.21 Dividend distribution Dividend distribution to the Company’s shareholders is recognised as a liability in the Company’s financial statements in the period in which the dividends are approved by the Company’s shareholders.

3. Financial risk Management 3.1 Financial risk factors

The Company’s activities expose it to a variety of financial risks: market risk (including foreign exchange risk), credit risk and liquidity risk. The Company’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Company’s financial performance.

Risk management is carried out by the Board of Directors on specific areas, such as foreign exchange risk, credit risk and the investment of excess liquidity.

a) Market risk

(i) Foreign exchange risk The Company operates internationally and is exposed to foreign exchange risk arising from various currency exposures. Foreign exchange risk arises from future commercial transactions, recognised assets and liabilities.

(ii) Price risk The Company is exposed to equity securities price risk because of the investment held by the Company and classified on the balance sheet as available-for-sale.

b) Credit risk The Company has no significant concentrations of credit risk. It has policies in place to ensure that sales of goods and services are made to customers with an appropriate credit history.

c) interest rate risk The Company’s exposure to interest rate risk relates to its bank and other borrowings which are on fixed and floating rate terms, and this risk is reviewed on an ongoing basis. At the balance sheet date the Company did not have in place any instruments to hedge its exposure to interest rate risk.

d) Liquidity risk Prudent liquidity risk management implies maintaining sufficient cash and marketable securities, the availability of funding through an adequate amount of committed credit facilities and the ability to close out market positions. The Company and the Group did not have committed credit facilities at the end of the year.

3.2 Capital risk managementThe Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital.

In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends payable to shareholders, issue new shares or sell assets to reduce debt.

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MTCCANNUAL REPORT

2009Financial

Statements

The Group monitors capital on the basis of the gearing ratio. This ratio is calculated as net debt divided by total capital. Net debt is calculated as total borrowings excluding trade and other payables, as shown in the balance sheet less cash and cash equivalents. Total capital is calculated as equity, as shown in the balance sheet, plus net debt.

3.3 Fair value estimationThe nominal value less impairment provision of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Company for similar financial instruments.

4. Comparatives The consolidated financial statements are the second to be prepared since the formation of a subsidiary and acquisition of interest in a jointly controlled entity. Therefore, comparative figures are shown for the previous year for the company and the group and where necessary, comparative figures have been adjusted at the entity level to conform with changes in presentation in the current year.

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Trading 2008

Contracting 2008

Marine 2008

Other 2008

Regional Airport & Resorts

2008 Unallocated

2008 Total 2008

Sales 209,613,154 354,476,638 70,738,408 49,611,553 - - 684,439,753

Operatingprofit/(Loss) 25,532,877 66,401,324 (6,789,341) 3,454,606 (741,971) (43,078,759) 44,778,736

Finance costs (Note 6.3) (19,040,775) (19,040,775)

ProfitfortheYear 25,737,961

Trading 2009

Contracting 2009

Marine 2009

Other 2009


2009 Unallocated

2009 Total 2009

Sales 105,936,602 259,854,667 76,145,805 30,681,434 - 809,956 473,428,464

Operatingprofit/(Loss) 16,911,339 30,027,138 (8,400,566) 15,247,344 (967,115) (44,329,242) 8,488,898

Finance costs (Note 6.3) (3,982,503) (629,331) (46,436) (18,091,744) (22,750,016)

ProfitfortheYear (14,261,118)

Trading Contracting Marine Other Regional Airport

& Resorts Unallocated Total

2008 Depreciation (Note 9 and 11) 1,051,663 30,193,609 16,739,464 11,199,261 42,969 2,740,443 61,967,409

2008 Amortization (Note 12) 9,560 2,964 - 5,238 967 656,677 675,406

2009 Depreciation (Note 9 and 11) 851,575 34,014,706 16,327,204 12,567,995 30,086 2,046,848 65,838,415

2009 Amortization (Note 12) 9,560 2,964 - - 967 819,682 833,173

Trading 2008

Contracting 2008

Marine 2008

Other 2008


2008 Unallocated

2008 Total 2008

Assets 153,471,129 145,411,081 100,539,346 123,612,207 78,702,950 177,306,991 779,043,704

Liabilities 93,191,901 44,087,976 (66,842) 260,482 74,816,483 239,938,470 452,228,470

Capital expd. (Note 9,10 & 12) 124,292 35,365,966 27,367,333 13,605,245 68,351 2,169,456 78,700,643

The segment assets and liabilities as at 31 December 2009 and capital expenditure for the year then ended are as follows:

Trading 2009

Contracting 2009

Marine 2009

Other 2009


2009 Unallocated

2009 Total 2009

Assets 64,484,407 168,697,207 88,754,809 111,862,642 80,472,457 209,924,265 724,195,788

Liabilities 954,850 46,158,763 9 2,500 77,553,107 306,045,323 430,714,552

Capital expd. (Note 9,10 & 11) 262,549 28,244,107 9,838,225 7,515,729 1,321,608 1,660,865 48,843,083

5. Segment information ( Restated )


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MTCCANNUAL REPORT

2009Financial

Statements

6.1 Other operating income

COMPANY GROUP

2009 2008 2009 2008

Dividendincomeonavailableforsalefinancialassets 2,791,052 3,347,460 2,791,052 3,347,460

Interest income 509,632 1,786,615 509,632 1,786,615

Gain on sale of property, plant and equipment 570,626 2,109,582 570,626 2,109,582

3,871,310 7,243,657 3,871,310 7,243,657

6.2 Other expenses

Repair and maintenance 3,999,306 3,336,420 3,999,306 3,336,420

Transportation and hire charges 1,851 9,265 1,851 9,265

Other expenses 3,020,207 4,648,427 3,020,207 4,648,427

7,021,364 7,994,112 7,021,364 7,994,112

6.3 Finance costs

Interest expense on bank borrowings 20,112,233 16,143,222 20,112,233 16,143,222

Netforeignexchange(Gain)/Loss 2,637,783 2,897,553 2,637,783 2,897,553

22,750,016 19,040,775 22,750,016 19,040,775

6.4 Depreciation,amortisation,foreign exchange differences and costs of inventories included in the consolidated income statementDepreciation (Note 9 and 11) 65,781,836 61,924,438 65,838,415 61,967,409

Amortisation (Note 12) 826,968 669,201 833,173 675,406

Impairmentoffixedassets 431,022 - 431,022 -

Employeebenefitexpense(Note6.5) 88,022,750 90,928,766 88,560,859 91,822,088

Materials and consumables 131,136,645 286,737,708 131,010,853 286,794,091

Director fees 769,975 937,635 831,975 997,635

Lease rent, hiring and sub contract expenses 94,381,394 110,167,964 94,381,394 110,167,964

Repairs and maintenance 13,243,891 20,959,674 13,244,813 20,992,880

Transportation, travel and inspection 5,233,189 8,734,897 5,513,105 8,934,317

Electricity,water,insurance and communication 18,872,070 20,787,341 19,104,692 21,044,364

Audit fees 554,731 315,624 574,006 334,899

Consultation, legal fees and service charges 3,979,893 4,797,217 3,375,861 4,046,393

Bank charges 1,206,777 8,599,855 1,227,502 8,604,599

Zakath 935,276 500,194 935,276 500,194

Advertising, sales promotion and marketing 31,600,959 14,002,285 31,600,959 21,096,877

Other expenses 10,839,887 8,712,691 11,346,969 8,925,559

Total 467,817,264 638,775,490 468,810,875 646,904,674

6. Other operating income and expenses


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COMPANY GROUP

2009 2008 2009 2008

Classifiedas:

Cost of sales 365,352,276 543,442,068 365,637,524 543,498,451

Selling and marketing costs 31,600,959 14,005,285 31,600,959 21,095,838

Administrative expenses 63,842,665 73,334,025 64,551,028 74,316,273

Other expenses 7,021,364 7,994,112 7,021,364 7,994,112

467,817,264 638,775,490 468,810,875 646,904,674

6.5 Employee benefits expense

Wages, salaries and bonus 68,301,705 67,301,964 68,729,750 67,924,479

Foreign staff expenses 1,090,256 1,862,621 1,090,256 1,862,622

Staff welfare 730,436 775,066 730,436 842,873

Staff medical expenses 38,162 68,433 38,162 68,433

Staff food allowance 4,933,373 9,327,421 5,043,437 9,530,420

Other allowance 12,928,818 11,593,261 12,928,818 11,593,261

88,022,750 90,928,766 88,560,859 91,822,088

7. Taxation There is no incidence of taxation on profits and income for companies in the Republic of Maldives. Accordingly, the company is not liable to income tax on profits earned in the Republic of Maldives.

8. Earnings per share 8.1 Basic-earnings per share is calculated by dividing net profit for the year attributable to ordinary shareholders of the company by the weighted average number of ordinary shares outstanding during the year. The following reflects the income and share data used in the earnings per share computations:

COMPANY GROUP

2009 2008 2009 2008

Netprofitattributabletoordinaryequityholders(Mrf) (12,355,339) 33,764,980 (14,261,118) 25,737,961

Weighted average number of ordinary share 250,000 250,000 250,000 250,000

Basic earnings per share (Mrf per share) (49.42) 135.06 (57.04) 102.95


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MTCCANNUAL REPORT

2009Financial

Statements

9. Property, plant and equipment - Company ( Restated )

Land Buildings Plant &

machinery Motor

vehicles

Furniture&Office/Communication

Equipment Vessels Sundry Assets Total

At 31 December 2007

Cost 7,370,831 63,838,306 311,510,125 12,008,233 26,463,440 96,388,238 19,373,592 536,952,765

Accumulated depreciation - (39,289,050) (184,735,023) (8,700,221) (19,381,014) (30,402,890) (12,068,397) (294,576,595)

Net book value 7,370,831 24,549,256 126,775,102 3,308,012 7,082,426 65,985,348 7,305,195 242,376,170

Year ended 31 December 2008

Opening net book value 7,370,831 24,549,256 126,775,102 3,308,012 7,082,426 65,985,348 7,305,195 242,376,170

Additions - 900,000 38,125,643 1,217,050 2,713,285 20,880,668 1,954,368 65,791,014

Reclassification - - 39,620 - - - - 39,620 Transferred from capital work in progress (Note 10) - 138,747 105,370 - - - - 244,117

Disposals - - (7,613) - (44,561) - (15,408) (67,582)

Depreciation charge (Note 6.4) - (3,598,698) (39,118,965) (1,421,650) (2,721,426) (10,298,776) (2,627,642) (59,787,157)

Closing net book value 7,370,831 21,989,305 125,919,157 3,103,412 7,029,724 76,567,240 6,616,513 248,596,182

At 31 December 2008

Cost 7,370,831 48,993,437 349,016,718 13,225,282 28,606,939 117,268,906 21,191,250 585,673,363


Net book value 7,370,831 21,989,305 125,919,157 3,103,412 7,029,724 76,567,240 6,616,513 248,596,182



Additions - 1,980,000 27,736,427 17,000 870,689 1,943,717 425,687 32,973,520 Transferred from capital work in progress (Note 10) - 1,610,409 - - 656,616 4,022,900 - 6,289,925

Disposals - - (492,472) - (107,159) - (21,824) (621,455)

Transferred to assets held for sales - - (101,283) (451,517) - - (552,800)

Impairment - (268,213) - - - - (162,809) (431,022)

Depreciation charge (Note 6.4) - (3,468,226) (43,049,779) (1,063,073) (2,452,850) (11,020,557) (2,590,070) (63,644,555)


At 31 December 2009

Cost 7,370,831 52,315,633 363,613,808 12,003,910 29,860,851 123,235,524 20,292,429 608,692,986


Net book value 7,370,831 21,843,275 110,012,049 1,605,822 5,997,019 71,513,302 4,267,497 222,609,795


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Property, plant and equipment - Group ( Restated )

Land Buildings Plant &

machinery Motor

vehicles

Furniture&Office/Communication

Equipment Vessels Sundry Assets Total

At 31 December 2007

Cost 7,370,831 63,838,306 311,510,125 12,008,233 26,656,997 96,388,238 19,373,592 537,146,322


Net book value 7,370,831 24,549,256 126,775,102 3,308,012 7,228,923 65,985,348 7,305,195 242,522,667



Additions 900,000 900,000 38,125,643 1,217,050 2,771,636 20,880,668 1,954,368 65,849,365

Reclassification - - 39,620 - - - - 39,620 Transferred from capital work in progress (Note 10) 138,747 138,747 105,370 - - - - 244,117

Disposals - - (7,614) - (44,561) - (15,408) (67,583)

Depreciation charge (Note 6.4) (3,598,698) (3,598,698) (39,118,965) (1,421,650) (2,764,397) (10,298,776) (2,627,642) (59,830,128)


At 31 December 2008

Cost 48,993,437 48,993,437 349,016,718 13,225,282 28,858,846 117,268,906 21,191,250 585,925,270

Accumulated depreciation (27,004,132) (27,004,132) (223,097,561) (10,121,870) (21,667,246) (40,701,666) (14,574,737) (337,167,212)

Net book value 21,989,305 21,989,305 125,919,157 3,103,412 7,191,600 76,567,240 6,616,513 248,758,058

Year Ended 31 December 2009


Additions 1,980,000 1,980,000 27,736,427 17,000 925,555 1,943,717 425,687 33,028,386 Transferred from capital work in progress (Note 10) 1,610,409 1,610,409 - - 656,616 4,022,900 - 6,289,925

Disposals - - (492,473) - (107,159) - (21,824) (621,456)

Transferred to assets held for sales - - (101,283) (451,517) - - - (552,801)

Impairment (268,213) (268,213) - - - - (162,809) (431,022)

Depreciation charge (Note 6.4) (3,468,226) (3,468,226) (43,049,779) (1,063,073) (2,509,429) (11,020,557) (2,590,070) (63,701,134)


At 31 December 2009

Cost 7,370,831 52,315,633 363,613,808 12,003,910 30,167,625 123,235,524 20,292,429 608,999,760


Net book value 7,370,831 21,843,275 110,012,049 1,605,822 6,157,182 71,513,301 4,267,497 222,769,957


50

MTCCANNUAL REPORT

2009Financial

Statements

10. Capital work in progressCOMPANY GROUP

2009 2008 2009 2008

Opening net book value 11,836,151 7,825,287 19,296,339 7,835,287

Expenditure incurred during the year 7,326,901 5,351,471 9,524,772 12,801,659

Transferred to property, plant and equipment (Note 9) (6,289,925) (244,117) (6,289,925) (244,117)

Transferred to intangible assets (Note 12) - (1,096,490) - (1,096,490)

Closing net book value 12,873,127 11,836,151 22,531,186 19,296,339

11. Investment propertiesCOMPANY GROUP

2009 2008 2009 2008

Opening balance at 1 January 35,411,119 37,548,400 35,411,119 37,548,400

Depreciation charge for the year (2,137,281) (2,137,281) (2,137,281) (2,137,281)

Closing balance at 31 December 33,273,838 35,411,119 33,273,838 35,411,119

Investment properties are stated at cost and depreciated over their useful lifetime.

12. Intangible assets COMPANY GROUP

2009 2008 2009 2008

At 1st January

Opening net book value 3,072,023 2,644,734 3,094,841 2,663,756

Transferred from capital work in progress - 1,096,490 - 1,096,490

Additions - - - 10,000

Amortisation charge (826,968) (669,201) (833,173) (675,406)

Closing net book value 2,245,055 3,072,023 2,261,668 3,094,841

At 31st December

Cost 4,961,170 4,961,170 4,990,691 4,991,658

Amortisation charge (2,716,115) (1,889,147) (2,729,023) (1,896,817)

Net book value 2,245,055 3,072,023 2,261,668 3,094,841


51


13. Financial InvestmentsCOMPANY GROUP

2009 2008 2009 2008

Investment in Airports Investments Maldives Private Limited 5,000,000 5,000,000 - -

Investment in Maldives Real Estate Investment Corporation Private Limited 7,102,500 7,102,500 - -

Shares in Bank of Maldives Plc 26,291,520 32,864,400 26,291,520 32,864,400

Shares in Maldives Finance and Leasing Company 9,637,500 9,637,500 9,637,500 9,637,500

48,031,520 54,604,400 35,929,020 42,501,900

Opening Balance

01.01.2009

Fall in Value

of Investment

Closing Balance

31.12.2009

Investment in Airports Investments Maldives Private Limited 5,000,000 - 5,000,000

Investment in Maldives Real Estate Investment Corporation Private Limited 7,102,500 - 7,102,500

Shares in Bank of Maldives Plc 32,864,400 (6,572,880) 26,291,520

Shares in Maldives Finance and Leasing Company 9,637,500 - 9,637,500

54,604,400 (6,572,880) 48,031,520

Financial investments, comprising principally marketable equity securities, are measured at fair value annually at the close of busi-ness on 31 December. For investments traded in active markets, fair value is determined by reference to Stock Exchange quoted bid prices.Therewerenodisposalonfinancialinvestmentsin2009and2008.Otherinvestments(unlistedsecurities)arestatedatcostsince the fair value of those shares cannot be measured reliably.

Financialinvestmentsareclassifiedasnon-currentassets,unlesstheyareexpectedtoberealisedwithintwelvemonthsofthebal-ance sheet date or unless they will need to be sold to raise operating capital. Financialinvestments,consistofmarketablesecuritiesofBankofMaldivesPlc,havingamarketvalueofMrf26,291,520/-(2008:Mrf32,864,400) and investment in equity shares of Maldives Finance Leasing Company Private Limited (MFLC), stated at cost of Mrf 9,637,500 (2008: Mrf 9,637,500), since the fair value of these unlisted shares cannot be measured reliably.

14. Trade and other receivablesCOMPANY GROUP

2009 2008 2009 2008 Restated Restated

Trade Receivables 226,484,402 200,938,820 233,551,902 208,006,320

Less: Provision for impairment of receivables (54,975,874) (28,172,596) (62,043,374) (35,240,096)

Trade receivables (Net) 171,508,528 172,766,224 171,508,528 172,766,224

Prepayments 16,731,644 11,937,401 80,981,644 76,187,401

Receivables from related parties (Note 23) 6,693,212 8,700,829 2,400,751 4,995,451

Other receivables 497,858 19,155,138 3,789,421 22,490,777

195,431,242 212,559,592 258,680,344 276,439,854

Less: Non-Current Portion: trade receivables (3,271,748) (4,571,139) (67,521,748) (68,821,139)

192,159,494 207,988,453 191,158,597 207,618,715

All amounts in Maldivian RufiyaaAs at 31 December 2009All amounts in Maldivian RufiyaaAs at 31 December 2009

52

MTCCANNUAL REPORT

2009Financial

Statements

The carrying amount of the trade and other receivables approximates its fair value.

Non-current receivables represent a part of retention money receivables from various construction projects after one year from the balance sheet date. Non-current receivables in the Group include proportionate share of lease rent advance paid to the Government of Maldives by the joint venture company.

Other receivables of the group mainly comprised by the receivable of joint venture which has consisted of calls-in-arrears from Island AviationServicesLimitedofMrf1,166,667/-(2008:Mrf1,166,667/-)advancesgivenfordevelopmentofairportislandtoHansang(Tenssor)ofMrf2,105,057/-(2008:Mrf2,105,057/-)andadvancetoResortlifeMaldivesPrivateLimitedMrf19,841.

There is no concentration of credit risk with respect to trade receivables, as the Company has large number of customers.

TheCompanyhasrecognizedaprovisionofMrf.54,975,874/-fortheimpairmentofitstradereceivablesduringtheyearended31December2009.TheGrouphasrecognizedaprovisionofMrf.62,043,374/-fortheimpairmentofitstradereceivablesduringtheyearended 31 December 2009. The creation and usage of provision for impaired receivables have been included in ‘selling and marketing costs’ in the income statement. Maturity pattern of non-current receivable are as follows:

GroupprepaymentsrepresentproportionateshareoftheleaserentadvancespaidtogovernmentofMaldivesofMrf115,650,000/-(proportionateshareMrf38,550,000)forresortsandMrf77,100.000/-(proportionateshareMrf25,700,000)forairportandtransitshotels, which will be adjusted against future lease rents.

GROUP

2009 2008

Between 1 and 2 years 3,271,748 4,571,139

Between 2 and 5 years 12,850,000 12,850,000

Over 5 years 51,400,000 51,400,000

67,521,748 68,821,139

15. Inventories COMPANY GROUP

2009 2008 2009 2008 Restated Restated

Construction and contracting materials 20,046,240 35,133,146 20,046,240 35,133,146

Lubricants, paints, construction materials 23,925,734 19,569,564 23,925,734 19,569,564

Engines and generators 91,968,155 85,848,823 91,968,155 85,848,823

Consumables 1,871,116 1,317,075 1,871,116 1,317,075

Provision slow moving items (7,162,523) (5,129,770) (7,162,523) (5,129,770)

130,648,722 136,738,838 130,648,722 136,738,838

Inventory - supplies 5,262,312 3,445,953 5,262,312 3,445,953

135,911,034 140,184,790 135,911,034 140,184,790

16. Cash and cash and cash equivalents COMPANY GROUP

2009 2008 2009 2008

Cash at bank and in hand 7,780,920 11,351,245 9,228,878 13,356,803

For the purposes of the cash flow statement, the cash and cash equivalents comprise the following:

Cash and cash equivalents 7,780,920 11,351,245 9,228,878 13,356,804

Bank overdrafts (Note 18) (113,420,045) (102,283,871) (113,420,045) (102,283,871)

(105,639,125) (90,932,626) (104,191,167) (88,927,067)


53


17. Share capital Number

of Shares Amount in MRF

At 1 January 2008 250,000 12,500,000

At 31 December 2008 250,000 12,500,000

At 31 December 2009 250,000 12,500,000

The total authorized number of ordinary shares is 250,000 shares with a par value of Mrf 50 per share (2008: Mrf 50 per share). All issued shares are fully paid.

18. Borrowings COMPANY GROUP

2009 2008 2009 2008

Non-current

Bank borrowings 45,656,637 69,384,897 45,656,637 69,384,897

Current

Bank overdraft (Note 16) 113,420,045 102,283,871 113,420,045 102,283,871

Bank borrowings 55,850,901 39,759,346 55,850,901 39,759,346

169,270,946 142,043,217 169,270,946 142,043,217

Total borrowings 214,927,583 211,428,114 214,927,583 211,428,114

Term loans from Bank of Maldives Plc are secured over MTCC building, MTCC Tower, Barge-7 and Tug Boat-Tango 575 to the value of Mrf 92,110,587 . The borrowings from Caterpillar Financial Services Asia Private Limited finance are secured against tractors, excavators and wheel loaders to the value of Mrf 55,948,445. The borrowing from Habeeb Bank finance is secured on speed boats to the value of Mrf 18,268,300.Import loans from HSBC are secured over 6086 shares of Bank of Maldives for USD 138,533/-, deposit for Mrf 3,257,286/- in the name of Maldives Transport and Contracting Company Private Limited.

The interest rate exposure of the borrowings of the company was as follows :Maturity of non-current borrowings

Between 1 and 2 years 26,801,544 34,108,872 26,801,544 34,108,872

Between 2 and 5 years 18,855,093 35,276,025 18,855,093 35,276,025

45,656,637 69,384,897 45,656,637 69,384,897

The effective interest rates at the balance sheet date were as follows:

Atfixedrates 214,927,583 211,428,114 214,927,583 211,428,114

Atfloatingrates - - - -

214,927,583 211,428,114 214,927,583 211,428,114


54

MTCCANNUAL REPORT

2009Financial

Statements

Financial Institution Interest Payable within

one year Payable after

one year Total Habib Bank Private Limited Fixed 2,204,162 2,206,233 4,410,395

Bank of Maldives ( Mrf ) Fixed 5,559,756 13,134,715 18,694,471

Islamic Development Bank Fixed 20,109,375 8,703,931 28,813,306

Hong Kong and Shanghai Banking Corporation Fixed 12,132,546 - 12,132,546

Caterpillar Financial Services Asia Private Limited Fixed 10,197,035 20,143,977 30,341,012

Senok Trade Combine Limited Fixed 5,648,027 1,467,780 7,115,807

55,850,901 45,656,637 101,507,538

Overdraft Fixed 113,420,045 - 113,420,045

Total borrowings 169,270,946 45,656,637 214,927,583

Interest Opening Balance

Proceeds

Repayment

End 2008

Bank of Maldives ( USD ) Fixed 788,701 - 788,701 -

Habib Bank Private Limited Fixed 6,606,233 - 2,195,838 4,410,395

Bank of Maldives ( Mrf ) Fixed 23,789,620 - 5,095,149 18,694,471

Islamic Development Bank Fixed 27,015,123 9,902,720 8,104,537 28,813,306

Hong Kong and Shanghai Banking Corporation Fixed 5,422,274 21,167,608 14,457,336 12,132,546

Caterpillar Financial Services Asia Private Ltd Fixed 30,652,482 7,885,008 8,196,478 30,341,012

Senok Trade Combine Limited Fixed 14,869,810 - 7,754,002 7,115,808

109,144,243 38,955,336 46,592,041 101,507,538

Overdraft Fixed 102,283,871 - - 113,420,045

Total borrowings 211,428,114 38,955,336 46,592,041 214,927,583

Effective interest rate exposure

Atfixedrates 214,927,583 211,428,114


55


Weighted average effective interest rates per annum:

COMPANY GROUP

2009 2008 2009 2008

Bank overdraft 9.25% 9.25% 9.25% 9.25%

Bank borrowings

Bank of Maldives Plc 9.25% 9.25% 9.25% 9.25%

People's Bank LIBOR + 0.5% LIBOR + 0.5% LIBOR + 0.5% LIBOR + 0.5%

Caterpillar Financial Services Asia Pte Ltd - Revolving 4.95% 4.95% 4.95% 4.95%

Caterpillar Financial Services Asia Pte Ltd-Special 5.25% 5.25% 5.25% 5.25%

Senok Trade Combined Ltd 4.50% 4.50% 4.50% 4.50%

Habib Bank Limited 8.50% 8.50% 8.50% 8.50%

The carrying amounts and fair value of the non-current borrowings are as follows:

CARRYING AMOUNT FAIR VALUES

2009 2008 2009 2008

Bank borrowing 45,656,637 69,384,897 39,702,798 59,772,585

The fair values are based on cash flows discounted using a rate based on the borrowing rate of 9.25% (2008: 9.25%).

19. Trade and other payables COMPANY GROUP

2009 2008 2009 2008

NON-CURRENT LIABILITIES

Lease rent advance - - 76,671,667 72,388,334

Trade payables 4,434,479 5,063,991 4,434,479 5,063,991

4,434,479 5,063,991 81,106,146 77,452,325

CURRENT LIABILITIES

Trade payables 62,982,227 96,340,992 62,982,227 96,340,992

Accrued expenses 4,633,581 3,750,137 4,697,565 3,886,477

Payables to related parties (Note 23) 9,455,738 8,406,284 5,627,825 6,025,174

Other payables 61,222,312 57,087,293 61,373,206 57,095,388

138,293,858 165,584,706 134,680,823 163,348,031

142,728,338 170,648,697 215,786,969 240,800,356

Other payables consist of unpaid dividend amounting to Mrf 18,227,872/-(2008: Mrf 19,763,777/-).

Group Non-current liabilities represent proportionate share in lease rent advance received by the joint venture which is comprising by advance from World Travel Link, sub-lessee for Raalhe Ode Island of Mrf 23,986,667/- (2008: Mrf 23,986,667/-), Maafushi Island of Mrf 24,415,000/- (2008: Mrf 24,415,000/-), Olhugiri Island of Mrf 23,986,667/-(2008: Mrf 23,986,667/-), and R.Ufulandhoo of Mrf 4,283,333/- respectively. The advance received will be adjusted against future lease rents.


56

MTCCANNUAL REPORT

2009Financial

Statements

20. Dividends per shareDividends payable are not accounted for until they have been ratified at the annual general meeting. A dividend in respect of 2009 of Mrf 10.00 per share (2008: declared dividend Mrf 50.00 per share) amounting to a total of Mrf 2,500,000/- (2008: actual Mrf 12,500,000/-) is to be proposed. These financial statements do not reflect this dividend payable, which will be accounted for in the shareholders’ equity as an appropriation of retained earning in the year ending 31 December 2010.

21. Contingencies CONTINGENT LIABILITIESThe company had a contingent liability in respect of letters of credit, amounting to Mrf 7,071,755/- (2008: Mrf 7,495,283/-) at the balance sheet date.The company had a contingent liability in respect of bank guarantee, amounting to Mrf 9,339,928/- (2008: Mrf 19,858,285/-) at the balance sheet date.

CONTINGENT ASSETSThere were no material contingent assets recognized at the balance sheet date. 22. CommitmentsCAPITAL COMMITMENTSThere were no material capital commitments outstanding at the balance sheet date. 23. Related party transactionsThe Government of Maldives along with State owned enterprise Maldives National Shipping Limited owns 60% equity shares of the Company, has substantial interest in the voting power of Hulhumale' Development Corporation Limited, State Trading Organization Plc, Bank of Maldives Plc, Maldives Airports Company Limited, and Maldives Real Estate Investment Corporation Pvt Ltd, The following transaction were carried out, on commercial terms and conditions, with related parties:

COMPANY GROUP

2009 2008 2009 2008

(i) Sales of goods and services

Maldives Industrial Fisheries Company Limited 3,223,598 3,710,972 3,223,598 3,710,972

State Trading Organization Plc 1,534,436 988,022 1,534,436 988,022

Maldives Airport Company Limited 1,029,399 1,447,398 1,029,399 1,447,398

Hulhumale Development Corporation Limited 210,814 1,489,069 210,814 1,489,069

Maldives National Shipping Limited 59,610 29,170 59,610 29,170

Maldives Tourism Development Corp Plc 3,840 51,750 3,840 51,750

Airport Investments Maldives Private Limited 2,640,673 6,773,471 2,640,673 261,550

8,702,371 14,489,852 8,702,371 7,977,931


57


COMPANY GROUP

2009 2008 2009 2008

(ii) Purchase of goods and services

Maldives Industrial Fisheries Company Limited 5,906 10,309 5,906 10,309

State Trading Organization Plc 1,883,974 23,295,149 1,883,974 23,295,149


Maldives Airport Company Limited 47,700 38,970 47,700 38,970

Maldives Real Estate Investment Corporation Pvt Ltd 2,559,693 771,721 - -

4,928,655 24,835,524 2,368,962 24,063,803

(iii)Yearendbalancesarisingfromsale/purchaseofgoodsandservices

Receivables from related parties (Note 14) :

Maldives Industrial Fisheries Company Limited 480,169 164,131 480,169 164,131

State Trading Organization Plc 183,750 42,209 183,750 42,209

Maldives Airport Company Limited 66,950 128,100 66,950 128,100

Hulhumale Development Corporation Limited 1,070 5,906 1,070 5,906


Maldives Tourism Development Corp Plc - 1,050 - 1,050

Airport Investments Maldives Private Limited 2,490,919 6,967,732 1,660,612 4,645,855

Maldives Real Estate Investment Corp Private Limited 3,462,154 1,383,501 - -

6,693,212 8,700,829 2,400,751 4,995,451

Payables to related parties (Note 19) :

State Trading Organization Plc 188,039 2,420,576 188,039 2,420,576


Maldives Airport Company Limited - 2,700 - 2,700

Airport Investments Maldives Private Limited 8,102,970 5,348,553 5,401,980 3,565,702

Maldives Industrial Fisheries Company Limited 306 - 306 -

Maldives Real Estate Investment Corporation Pvt Ltd 1,126,923 598,260 - -

9,455,738 8,406,284 5,627,825 6,025,174

(iv) Loan from a related party

Bank of Maldives Plc - 788,701 - 788,701

The movement in the year can be analyzed as follows:

Beginning of the year 788,701 4,168,370 788,701 4,168,370

Loans repaid during the year (788,701) (3,379,669) (788,701) (3,379,669)

End of the year - 788,701 - 788,701


58

MTCCANNUAL REPORT

2009Financial

Statements

Term loans, bank overdraft, LC facility and bank guarantee from Bank of Maldives Plc are secured over MTCC building, MTCC Tower, Barge-7 and Tug Boat-Tango 575 to the value of Mrf 92,110,587 . The loan carries an interest of 9.25% per annum.

COMPANY GROUP

2009 2008 2009 2008

(v) Key management remuneration 855,866 855,866 1,049,609 1,049,609

24. Post balance sheet eventsSub contractor prepayments amounting to Mrf 12,412,438/- which has to be expensed during the year, has not been charged against prepayments and has not been charged to the income statement as a expenditure in 2008. Therefore the same has been recorded and the comparative financial information has been restated. The effect of the restatement on those financial statement is summarised below.

Effect on year ended

31 Dec 2008

Income statement

Increase in cost of sales 12,412,438

Decreaseinprofit 12,412,438

Earnings per share 135.06

31 Dec 2008

Balance sheet

Decrease in Prepayments 12,412,438

Decrease in equity 12,412,438

25. Post balance sheet eventsG. Dh. Maavehdhoo Project carried out by Maldives Transport and Contracting Company Plc was terminated during the year 2010 as it was informed by Airports Investement Company Pvt Ltd that the Project cannot be continued any further as the Government had announced that Airports Investmet Company Pvt Ltd’s head leases will be terminated. Due to this Maldives Transport and Contracting Company Plc had incurred certain losses for the project.


59


Directors’ ShareholdingsName Address No. Of Shares

Mr. Hussain Hilmy Ma. Vahaari 0

Mr. Mohamed Shafeeq Ma.Fosythia 0

Abdullah Naushad M.Shaamaa 0

Abdul Nasir Mohamed G.Liverpool 2

Shafeenaz Abdul Sattar G.Helengeli 1

Abdullah Shaairu M.Furahani Aage 2

Hussen Haaly H.Iruvai 2

Mansoor Zubair Kothanmaage, S.Hithadhoo 2

Ameen Ibrahim H.Haali 5

Ali Shafeeu M.Hudhukaneeruge 1

60

MTCCANNUAL REPORT

2009Financial

Statements

Financial Highlights of 10 YearsGroup Group Group

2009 2009 2008 2008 2007 2007 2006 2005 2004 2003 2002 2001 2000

Sales 473.43 474.34 684.44 684.34 563.96 563.96 397.70 357.69 304.49 345.10 264.62 229.62 167.53

Cost of Sales 365.64 365.35 531.09 531.03 450.00 449.97 306.08 281.41 248.34 280.06 147.72 127.20 97.91

GrossProfit 107.79 108.99 153.35 153.31 113.95 113.99 91.62 76.29 58.15 65.04 116.90 102.42 69.62

Expenses and Other Income (net) 99.30 98.59 95.66 87.59 77.16 76.50 48.49 39.66 33.96 42.78 84.95 74.14 46.08

OperatingProfit 8.49 10.40 57.69 65.72 36.80 37.49 43.13 36.63 22.18 22.26 31.95 28.28 23.54

Financing Cost 22.75 22.75 19.04 19.04 0.39 0.39 2.19 2.13 2.71 6.96 5.73 6.46 4.15

NetProfit (14.26) (12.35) 38.65 46.68 36.41 37.10 40.94 34.49 19.47 15.30 26.22 21.82 19.39

Extraordinary Items - - - - - - - - - 23.77 -

NetProfit (14.26) (12.35) 38.65 46.68 36.41 37.10 40.94 34.49 19.47 39.07 26.22 21.82 19.39

Non- Current Assets 384.84 322.86 417.88 358.09 420.35 366.53 215.71 174.66 167.39 180.10 157.77 105.90 113.74

Total Current Assets 339.36 338.91 370.71 371.94 310.62 293.73 175.67 155.01 154.39 136.35 140.13 107.54 76.30

Total Assets 724.20 661.77 788.59 730.03 730.97 660.26 391.38 329.66 321.78 316.45 297.90 213.44 190.04

Total Current Liabilities 303.95 307.56 302.03 307.13 300.89 301.86 102.18 78.62 92.38 84.97 116.88 65.73 55.74

Working Capital 35.41 31.35 68.68 64.81 9.73 (8.13) 73.49 76.39 62.01 51.38 23.25 41.81 20.56

Net Assets 420.25 354.21 486.56 422.90 430.08 358.40 289.20 251.05 229.40 231.48 181.02 147.71 134.30

Shareholder's Equity 293.48 304.11 339.73 348.45 333.14 333.84 261.54 227.80 197.28 183.48 140.72 120.74 105.18

Capital Employed 420.25 354.21 486.56 422.90 430.08 358.40 289.20 251.05 229.40 231.48 181.02 147.71 134.30

Dividends Relating to Previous Year 12.50 12.50 11.25 11.25 8.75 8.75 7.50 6.25 6.75 6.75 6.25 6.25 5.50

Transferred to Reserves & Retained Profit (1.76) 0.15 27.40 35.43 27.66 28.35 33.44 28.24 12.72 32.32 19.97 15.57 13.98

Dividend Per share NA 10.00 NA 45.00 NA 45.00 35.00 30.00 25.00 27.00 25.00 25.00 22.00

Return on Equity (before extra-ordinary items) -4.86% -4.06% 11.38% 13.40% 10.93% 11.11% 15.65% 15.14% 9.87% 8.34% 18.63% 18.07% 18.44%

Return on Net Assets -3.39% -3.49% 7.94% 11.04% 8.47% 10.35% 14.16% 13.74% 8.49% 6.61% 14.48% 14.77% 14.44%

Share Capital 12.50 12.50 12.50 12.50 12.50 12.50 12.50 12.50 12.50 12.50 12.50 12.50 12.50

Net Assets Value per Share 1,173.92 1,216.44 1,358.92 1,393.80 1,332.57 1,335.35 1,046.17 911.21 789.10 733.94 562.88 482.96 420.72

mtcc · mr. abdulla ali government terminated on 04 feb 2009 mr. ibrahim shaheen government...

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