// Concept Rationale
Having successfully steered the Group into the previously
uncharted business of water distribution services in the past one
year, the Management of the PNHB Group is now looking to
consolidate and strengthen its position and relationship with the
consumers by ensuring that their expectations and requirements
for clean and reliable water supply are met.
This years Annual Report focuses on Puncak Niaga ’s ongoing
andran
commitment to reach out and harness a more fluid partnership with
h
Ramac
Mr N.
its consumers and stakeholders.
Each of the individuals depicted on the cover and within the theme
pages of this Annual Report, represent consumers from diverse
backgrounds in the State of Selangor and the Federal Territories of
Kuala Lumpur and Putrajaya whom have benefited from the
services provided by the PNHB Group.
Madam Sally
It is a testimony to the success of Puncak Niaga’s customer-centric
Low
approach to reach out and make a difference in the lives of the
consumers that is the driving force of Puncak Niaga’s strategic
direction and vision for the future.
h
Puan Suraya
ly,
ter supp
lean wa
rce of c
u
so
r
e
.”
p
epped in
get a pro
ABAS st
eans to
; until SY
erous m
lp
azri
m
e
u
h
N
n
d
to
d
“ I trie
willing
ama
a
Moh
ne was
erating
but no o
Encik
y
ndran
from op
a
h
c
a
lt with m
am
come is
a
R
e
in
.
d
f
N
r
o
r
to
e
M
rc
ibu
only sou
ew distr
y
n
m
e
s
th
a
st
water,
t how fa
n clean
ankful a
pipes.”
“ I rely o
am so th
om the
I
fr
.
r
e
tt
te
a
re
w
h
is
w
launde
llo
e
s over y
hildren.
concern
r their c
lly Low
look afte
a
S
to
m
ty
a
ili
.”
sib
Mad
concern
e respon
my main
n me th
giene is
ave give
y
h
h
n
d
n
re
a
ild
h
“ My ch
n’s healt
loom
dchildre
ve and b
My gran
ts to thri
n
la
p
y
h
rm
raya
y land fo
Puan Su
nt on m
every pla
h
c
a
re
needs to
ers.”
Encik
“ Water
y custom
Jatin
r piped
lly for m
m wate
fu
ti
u
a
e
b
ower fro
zri
a
sh
N
a
d
g
a
kin
oham
njoyed ta
Encik M
I have e
life that
y
m
in
me
e first ti
e.”
“ It is th
my hom
to
y
tl
c
e
dir
P u n c a k N i a g a H o l d i n g s cBike rJa
h atidn
1 ANNUAL REPORT 2005
En
Annual General Meeting
Date
Wednesday, 28 June 2006
Hour
9.30 a.m.
Venue
Banquet Hall
Kuala Lumpur Golf & Country Club
No. 10, Jalan 1/70D
Off Jalan Bukit Kiara
60000 Kuala Lumpur
Contents
2-3
Notice of Annual General Meeting
4-5
Statement Accompanying the Notice
of Annual General Meeting
6-7
Corporate Information
8-10
Fact Sheet
12-13
Corporate Profile
14
Vision & Mission Statements
15
Corporate Structure
16-17
Organisation Structure
18
Financial Highlights
19
Financial & Share Performance
20
Our Role In The Water Supply System
22-27
Board of Directors
28-31
Senior Management In PNSB
32-35
Senior Management In SYABAS
36
Corporate Achievements
38-41
Executive Chairman Speaks
42-48
Operations Review : PNSB
Water Treatment Activities
49-54
Operations Review : SYABAS
Water Distribution Activities
55-57
Corporate Social Responsibility
58-67
Corporate Calendar of Events
68-71
Newspaper Clippings
73-83
Statement on Corporate Governance
84-85
Statement on Internal Control
86-91
Audit Committee Report
92-93
Risk Management Policy & Report
94-96
Investor Relations Policy & Report
97
Quality Policy & Report
98
Corporate Disclosure Policy
99-103
Distribution Schedule of Equity Securities & Properties
105-178
Financial Report
179-180
Proxy Form
Pull-out
Health, Safety & Environmental Policy & Report
Puncak Niaga Holdings Berhad
ANNUAL REPORT 2005 1
NOTICE OF
A N N UA L G E N E R A L M E E T I N G
NOTICE IS HEREBY GIVEN THAT the Ninth Annual General Meeting of Puncak Niaga Holdings Berhad
(416087-U) will be held at the Banquet Hall, Kuala Lumpur Golf & Country Club, No. 10, Jalan 1/70D, Off
Jalan Bukit Kiara, 60000 Kuala Lumpur on Wednesday, 28 June 2006 at 9.30 a.m. for the following
purposes:Resolution 1
1. To receive the Audited Accounts of the Company for the financial year ended 31 December 2005 and
the Reports of the Directors and Auditors thereon.
Resolution 2
2. To declare a final dividend of 6 sen per share less 28% income tax in respect of the financial year
ended 31 December 2005 as recommended by the Directors of the Company.
3. To re-elect the following Directors of the Company who retire by rotation pursuant to Article 98 of the
Company’s Articles of Association:-
Resolution 3
(a) Ir Lee Miang Koi
Resolution 4
(b) YBhg Tan Sri Dato’ Hari Narayanan a/l Govindasamy
4. To re-elect the following Directors of the Company who retire by rotation pursuant to Article 103 of
the Company’s Articles of Association: -
Resolution 5
(a) Encik Matlasa Hitam
Resolution 6
(b) Mr Tan Seng Lee
Resolution 7
5. To re-appoint Messrs Ernst & Young as the Auditors of the Company and to authorise the Directors of
the Company to fix their remuneration.
AS SPECIAL BUSINESS:To consider and, if thought fit, to pass the following Ordinary Resolution:-
Resolution 8
6. Allotment Of Shares Pursuant To Section 132D Of The Companies Act, 1965
“THAT subject always to the Companies Act, 1965, the Articles of Association of the Company and
the approvals of the relevant governmental/regulatory authorities, the Directors of the Company be
and are hereby empowered, pursuant to Section 132D of the Companies Act, 1965, to issue shares in
the Company, from time to time, and upon such terms and conditions and for such purposes as the
Directors of the Company may deem fit provided that the aggregate number of shares issued pursuant
to this resolution does not exceed ten per centum (10%) of the issued share capital of the Company
for the time being AND THAT the Directors of the Company be and are hereby also empowered to
obtain the approval for the listing of and quotation for the additional shares so issued on Bursa
Malaysia Securities Berhad AND FURTHER THAT such authority shall continue to be in force until the
conclusion of the next Annual General Meeting of the Company.”
7. To transact any other ordinary business of which due notice shall have been given.
2 ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
NOTICE OF DIVIDEND ENTITLEMENT AND PAYMENT
NOTICE IS ALSO HEREBY GIVEN THAT subject to the approval of the shareholders of the Company at the
Ninth Annual General Meeting, a final dividend of 6 sen per share less 28% income tax for the financial
year ended 31 December 2005, will be paid on 8 August 2006 to Depositors whose names appear in the
Record of Depositors of the Company on 18 July 2006.
A Depositor shall qualify for entitlement to the dividends only in respect of:a. shares transferred into the Depositor’s Securities Account before 4.00 p.m. on 18 July 2006 in respect
of transfers; and
b. shares bought on Bursa Malaysia Securities Berhad on a cum entitlement basis according to the Rules
of Bursa Malaysia Securities Berhad.
BY ORDER OF THE BOARD
TAN BEE LIAN (MAICSA 7006285)
Secretary
Kuala Lumpur
6 June 2006
Notes:1. A member entitled to attend and vote at the Meeting is entitled to appoint a proxy to attend and vote
in his stead. A proxy need not be a member of the Company.
2. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney
duly authorised or if such appointer is a corporation, it must be either under its seal or under the hand
of an officer or attorney duly authorised.
3. The instrument appointing the proxy must be deposited at the Registered Office of the Company at
Suite 1701-1706, 17th Floor, Plaza See Hoy Chan, Jalan Raja Chulan, 50200 Kuala Lumpur not less than
48 hours before the time set for holding the Meeting or any adjournment thereof.
4. Explanatory Note On Special Business:Resolution 8:The Ordinary Resolution proposed under item 6, if passed, will give the Directors of the Company, from
the date of the above Meeting, authority to issue and allot ordinary shares from the unissued capital
of the Company for such purposes as the Directors of the Company consider would be in the interest
of the Company. This authority will, unless revoked or varied at a General Meeting, expire at the next
Annual General Meeting of the Company.
Puncak Niaga Holdings Berhad
ANNUAL REPORT 2005 3
s tat e m e n t a cco m pa n y i n g t h e
n o t i c e o f a n n ua l g e n e r a l m e e t i n g
1) BOARD MEETINGS
In year 2005, the Board met five (5) times at the Board Room on 26th Floor, Suite 2601 – 2606, Plaza See Hoy Chan, Jalan Raja Chulan,
50200 Kuala Lumpur. The details of the respective Directors’ attendance at the Board Meetings are as follows:Name of Director
Designation
No. of Meetings
%
attended
Tan Sri Rozali Ismail
Executive Chairman
5
100
Non-Independent
5
100
4
80
Independent Non-Executive Director
4
80
Independent Non-Executive Director
5
100
Syed Danial Syed Ariffin
Executive Director, Operation I
5
100
Datuk Dr Rahman Ismail
Independent Non-Executive Director
4
80
Tan Seng Lee
Executive Director, Finance
1
100
Managing Director
1
100
Ruslan Hassan
Non-Executive Director
Ir Lee Miang Koi
Non-Independent
Non-Executive Director
Tan Sri Dato’ Hari
Narayanan Govindasamy
Tan Sri Dato’ Seri
Dr Ting Chew Peh
(appointed on 1 September 2005)
Matlasa Hitam
(appointed on 1 October 2005)
Director who resigned in 2005
Name of Director
Designation
No. of Meetings
%
attended
Dato’ Mat Hairi Ismail
Executive Director, Finance
N/A
N/A
Independent Non-Executive Director
N/A
N/A
2
100
(resigned on 3 January 2005)
Abdul Majid Abdul Karim
(resigned on 3 January 2005)
Loong Chun Nee
Executive Director, Finance
(resigned on 23 June 2005)
2) DATE, TIME AND VENUE OF THE NINTH ANNUAL GENERAL MEETING
The Ninth Annual General Meeting of Puncak Niaga Holdings Berhad will be held as follows:Date
: Wednesday, 28 June 2006
Time
: 9.30 a.m.
Venue : Banquet Hall, Kuala Lumpur Golf & Country Club
No. 10, Jalan 1/70D, Off Jalan Bukit Kiara, 60000 Kuala Lumpur
3) PARTICULARS OF DIRECTORS STANDING FOR RE-ELECTION AT THE NINTH ANNUAL GENERAL MEETING
Name of Retiring
Director
Ir Lee Miang Koi
Tan Sri Dato’ Hari
Narayanan Govindasamy
Matlasa Hitam
Tan Seng Lee
Age
52
56
65
47
Nationality
Malaysian
Malaysian
Malaysian
Malaysian
4 ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
Name of Retiring
Director
Ir Lee Miang Koi
Tan Sri Dato’ Hari
Narayanan Govindasamy
Matlasa Hitam
Tan Seng Lee
Qualification
Masters Degree in
Environmental
Engineering from Asian
Institute of Technology,
Bangkok
Bachelors Degree in
Electrical and Electronic
Engineering from
University of
Northumbria, England
1. Bachelors Degree in
Business Administration
(Hons.) from Monmouth
College, USA
2. Masters Degree in
Business Administration
(Finance) from Central
Michigan University,
USA
1. Master in Business
Administration
2. Chartered Accountant
3. Certified Public
Accountant
Position In PNHB
Non-Independent
Non-Executive Director
Independent
Non-Executive Director
Managing Director
Executive Director,
Finance
Working Experience
& Occupation
Ir Lee has 28 years of
working experience.
For details, please refer
to his profile on page 25
of the Annual Report
YBhg Tan Sri Dato’ Hari
Narayanan has 29 years
of working experience.
For details, please refer
to his profile on page 26
of the Annual Report
En Matlasa has more
than 30 years senior
management working
experience. For details,
please refer to his
profile on page 24 of the
Annual Report
Mr Tan has 26 years
of working experience.
For details, please refer
to his profile on page 26
of the Annual Report
Directorships in
other public
companies
None
1. Tenaga Nasional
Berhad
2. SP Setia Berhad
None
None
Details of
attendance at Board
Meetings
4/5 (80%)
4/5 (80%)
1/5 (100%)
He was only appointed
to PNHB Board on
1 October 2005
1/5 (100%)
He was only appointed
to PNHB Board on
1 September 2005
The place, date and
hour of the Board
Meetings
Please refer to page 74
of the Annual Report
Please refer to page 74
of the Annual Report
Please refer to page 74
of the Annual Report
Please refer to page 74
of the Annual Report
Equity securities
interests in PNHB
and its subsidiaries
Please refer to page 101
of the Annual Report
Please refer to page 101
of the Annual Report
None
None
Family relationship
with any director
and/or substantial
shareholder of PNHB
None
None
None
None
Any conflict of
interest with PNHB
None
None
None
None
List of convictions
for offences (other
than traffic offences)
within the past
10 years
None
None
None
None
Puncak Niaga Holdings Berhad
ANNUAL REPORT 2005 5
CO R P O R AT E I N F O R M AT I O N
Principal Office
Board of Directors
Yang Berbahagia Tan Sri Rozali Ismail
Suite 2601-2606, 26th Floor
Executive Chairman
Plaza See Hoy Chan
Jalan Raja Chulan
Encik Matlasa Hitam
50200 Kuala Lumpur
Managing Director
Tel
: 603-2031 8648
Fax
: 603-2031 8658
Encik Ruslan Hassan
website : www.puncakniaga.com.my
Non-Independent Non-Executive Director
e-mail (general)
: corpcom@puncakniaga.com.my
e-mail (investors)
: investors@puncakniaga.com.my
Ir Lee Miang Koi
Non-Independent Non-Executive Director
Mr Tan Seng Lee
Executive Director
Finance Division
Tuan Syed Danial Syed Ariffin
Executive Director
Date and Place of Incorporation
Operation I Division
7 January 1997, Malaysia
Yang Berbahagia Tan Sri Dato’ Hari Narayanan Govindasamy
Independent Non-Executive Director
Yang Berhormat Tan Sri Dato’ Seri Dr Ting Chew Peh
Independent Non-Executive Director
Yang Berhormat Datuk Dr Rahman Ismail
Independent Non-Executive Director
Group Company Secretary
Madam Tan Bee Lian, MAICSA 7006285
Plaza See Hoy Chan
Messrs Ernst & Young (AF 0039)
Tax Advisor
Messrs Ernst & Young Tax Consultants Sdn Bhd
Principal Bankers
RHB Bank Berhad (6171-M)
Messrs Kadir, Andri & Partners
50200 Kuala Lumpur
: 603-2078 4386
Auditors
Solicitors
Jalan Raja Chulan
Fax
416087-U
United Overseas Bank (Malaysia) Bhd (271809-K)
Suite 1701-1706, 17th Floor
: 603-2031 8648
Company Number
Bumiputra-Commerce Bank Berhad (13491-P)
Registered Office
Tel
Branch Office
No. 8 Jalan Senangin 1
Taman Perniagaan Senangin
Jalan Sultanah Sambungan
05150 Alor Setar
Kedah Darul Aman
Tel
: 604-734 8648
Fax
: 604-734 8658
Messrs Wong & Partners
Messrs Lee Hishammuddin
Messrs Sivananthan
Messrs Ng Yook Woon, Andrew TC Saw & Co
Messrs Azian Haslina & Co
6 ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
Share Registrar
Remuneration Committee
(Place where all registers of securities are kept)
Chairman:
Tenaga Koperat Sdn Bhd (118401-V)
Yang Berhormat Datuk Dr Rahman Ismail
20th Floor, Plaza Permata
Jalan Kampar
Members:
Off Jalan Tun Razak
Yang Berbahagia Tan Sri Dato’ Hari Narayanan Govindasamy
50400 Kuala Lumpur
Yang Berhormat Tan Sri Dato’ Seri Dr Ting Chew Peh
Tel
: 603-4041 6522
Mr Tan Seng Lee
Fax
: 603-4042 6352
Secretary:
Stock Exchange Listing
Madam Tan Bee Lian
Main Board of Bursa Malaysia under the
Infrastructure Project Companies Sector
Nomination Committee
Chairman:
Indices
Yang Berhormat Datuk Dr Rahman Ismail
Kuala Lumpur Composite Index (KLCI)
Kuala Lumpur Syariah Index
Members:
Yang Berbahagia Tan Sri Dato’ Hari Narayanan Govindasamy
Audit Committee
Yang Berhormat Tan Sri Dato’ Seri Dr Ting Chew Peh
Chairman:
Yang Berhormat Tan Sri Dato’ Seri Dr Ting Chew Peh
Secretary:
Madam Tan Bee Lian
Members:
Yang Berbahagia Tan Sri Dato’ Hari Narayanan Govindasamy
Compliance, Internal Control and
Yang Berhormat Datuk Dr Rahman Ismail
Risk Policy Committee (CICR)
Mr Tan Seng Lee
Chairman:
Yang Berhormat Tan Sri Dato’ Seri Dr Ting Chew Peh
Secretary:
Madam Tan Bee Lian
Members:
Encik Matlasa Hitam (Head of CICR)
ESOS Option Committee
Encik Sonari Solor
Chairman:
Mr Ng Wah Tar
Yang Berbahagia Tan Sri Rozali Ismail
Madam Tan Bee Lian
Members:
Secretary:
Encik Matlasa Hitam
Encik Mohammed Sofian Ismail
Tuan Syed Danial Syed Ariffin
(Head of Risk Management Section)
Mr Tan Seng Lee
Secretary:
Madam Tan Bee Lian
Puncak Niaga Holdings Berhad
ANNUAL REPORT 2005 7
FA C T S H E E T
PUNCAK NIAGA HOLDINGS BERHAD’S FACT SHEET AS AT 27 APRIL 2006
Group Manpower:
Management Employees
162
Executive Employees
597
Non-Executive Employees
2,926
Total
3,685
No. of PNSB’s Water Treatment Plants
28
No. of Water Treatment Plants with ISO Certifications
2
Authorised Share Capital
RM1,000,000,000
Paid-Up Share Capital
RM464,228,000 (comprising 464,228,000 ordinary
Number of RUN Issued
546,875,000
RUN Coupon Rates
2.5% per annum for the first 10 years and 3.5%
shares of RM1.00 each)
per annum for the remaining 5 years
RUN Semi-Annual Coupon Payment Dates
20 May and 20 November
RUN Maturity Date
18 November 2016
RUN Holders’ Put Option Date
20 November 2011
Number of Warrants Issued and Unexercised
107,874,869
Warrant Conversion Price
RM2.62
Number of Warrants Converted
1,500,000
Warrant Maturity Date
20 November 2006
Effective Date of ESOS
25 February 2002
Expiry Date of ESOS
24 February 2007
ESOS Exercise Price (1st Tranche)
RM2.37 per share
ESOS Exercise Price (2nd Tranche)
RM2.47 per share
ESOS Exercise Price (3rd Tranche)
RM2.13 per share
ESOS Exercise Price (4th Tranche)
RM2.71 per share
ESOS Exercise Price (5th Tranche)
RM3.27 per share
ESOS Exercise Price (6th Tranche)
RM2.04 per share
ESOS Exercise Price (7th Tranche)
RM2.56 per share
ESOS Exercise Price (8th Tranche)
RM2.40 per share
ESOS Exercise Price (9th Tranche)
RM2.33 per share
Number of ESOS Offered (1st Tranche)
33,422,000
Number of ESOS Offered (2nd Tranche)
2,933,000
Number of ESOS Offered (3rd Tranche)
2,817,000
Number of ESOS Offered (4th Tranche)
1,349,000
Number of ESOS Offered (5th Tranche)
1,635,000
Number of ESOS Offered (6th Tranche)
979,000
Number of ESOS Offered (7th Tranche)
3,041,000
Number of ESOS Offered (8th Tranche)
1,351,000
Number of ESOS Offered (9th Tranche)
2,307,000
Total
49,834,000
8 ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
List
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
of Corporate Memberships:
Malaysian Water Association (MWA)
Malaysia South-South Association (MASSA)
Federation of Public Listed Companies (FPLC)
Malaysian Employers Federation (MEF)
Malaysian Industry-Government Group for High Technology (MIGHT)
Malaysian-German Chamber of Commerce and Industry (MGCC)
National Institute of Occupational Safety and Health (NIOSH)
American Water Works Association (AWWA)
Malaysian-French Chamber of Commerce and Industry (MFCCI)
Malaysia-Russia Business Council
British Malaysian Chamber of Commerce (BMCC)
Research Institute of Investment Analysts Malaysia (RIIAM)
Malaysia-Japan Economic Association (MAJECA)
Commonwealth Partnership for Technology Management (CPTM)
Institute of Marketing Malaysia (IMM)
South East Asian Water Utilities Network (SEAWUN)
Malaysian Islamic Chamber of Commerce (MICC)
Member
Member
Member
Member
Member
Member
Member
Member
Member
Member
Member
Member
Member
Member
Member
Member
Member
since
since
since
since
since
since
since
since
since
since
since
since
since
since
since
since
since
1994
1995
1997
1999
2001
2002
2002
2002
2002
2002
2003
2003
2003
2003
2003
2004
2006
Water Treatment Plants:
Puncak Niaga (M) Sdn Bhd
Central Region
Bukit Nanas
Sungai Batu
Ampang Intake
Sungai Rangkap
Gombak
Kepong
Sungai Rumput
Sungai Kroh
Sungai Pusu
Wangsa Maju
TEL/FAX NO:
603 – 2078 0782
603 – 6189 0267
603 – 4291 4040
603 – 6091 0001
603 – 6189 5255
603 – 6274 9495
603 – 6185 6631
603 – 6274 9495
603 – 6185 6631
603 – 4143 7006
Northern Region
Bernam River Headworks
Batang Kali
Sungai Dusun
Sungai Selisik
Sungai Tengi
Kalumpang
Kuala Kubu Bharu
Sungai Buaya
North Hummock
Rantau Panjang
603
603
603
605
603
603
603
603
603
603
–
–
–
–
–
–
–
–
–
–
6046 1259
6057 3255
6046 3649
454 1354
6042 2035/603 – 6042 2346 (Intake)
6049 1366
6064 1327
6028 1146
3341 2052
3271 0948/603 – 3271 9133
Southern Region
Sungai Langat
Cheras Mile 11
Sungai Serai
Sungai Lolo
Sungai Pangsoon
Bukit Tampoi
Salak Tinggi
Sungai Selangor Phase 2#
603
603
603
603
603
603
603
603
–
–
–
–
–
–
–
–
9076
8736
9075
9021
9021
8768
8706
3279
7299
0427
3977
5993
5993
6216
1103
2008
Puncak Niaga Holdings Berhad
ANNUAL REPORT 2005 9
FA C T S H E E T
Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS)
District Offices
Central Zone
Kuala Lumpur
Jalan Pantai Baharu, 59990 Kuala Lumpur
Petaling
Jalan Templer, 46050 Petaling Jaya
Selangor Darul Ehsan
Northern Zone
Kuala Selangor
Jalan Kelang, Jalan Bukit Kemajuan
45000 Kuala Selangor, Selangor Darul Ehsan
TEL/FAX NO:
Tel : 603 – 2282 6244
Fax : 603 – 2282 5498
Tel : 603 – 7781 4455
Fax : 603 – 7781 2052
Tel : 603 – 3289 1343
Fax : 603 – 3289 2040
Sabak Bernam
Jalan Besar, 45300 Sungai Besar
Sabak Bernam, Selangor Darul Ehsan
Tel : 603 – 3224 2936
Fax : 603 – 3224 2438
Hulu Selangor
Bangunan JKR, Jalan Kemajuan
44000 Kuala Kubu Bahru, Selangor Darul Ehsan
Tel : 603 – 6064 1273
Fax : 603 – 6064 1520
Gombak
Bandar Baru Selayang, 68100 Batu Caves
Selangor Darul Ehsan
Tel : 603 – 6138 4820
Fax : 603 – 6138 2002
Southern Zone
Hulu Langat
Jalan Semenyih, 43000 Kajang
Selangor Darul Ehsan
Tel : 603 – 8733 5717
Fax : 603 – 8736 7137
Kuala Langat
Telok Dato’, 42700 Banting
Selangor Darul Ehsan
Tel : 603 – 3187 2244
Fax : 603 – 3187 8144
Sepang
No. 29 Jalan 6, Kosmopleks
Bandar Baru Salak Tinggi
43900 Sepang, Selangor Darul Ehsan
Tel : 603 – 8706 1154
Fax : 603 – 8706 1187
Klang
Jalan Kota, 41000 Klang
Selangor Darul Ehsan
Tel : 603 – 3371 0144
Fax : 603 – 3371 0830
SYABAS Customer Service Centre (PUSPEL)
Toll-free Helpline : 1-800-88-5252
Fax No. : 603 – 2295 5168
SMS at 39222 type : PUSPEL<space>
<your complaints/feedback>
E-mail : puspel@syabas.com.my
#
Awarded the following certification:
1. Occupational Health & Safety Management System (OHSAS 18001:1999)
2. Environmental Management System (ISO 14001:2004/EN ISO 14001:2004/BS EN ISO 14001:2004/MS ISO 14001:2004)
3. Quality Management System (ISO 9001:2000/EN ISO 9001:2000/BS EN ISO 9001:2000/MS ISO 9001:2000)
4. Competence of Testing Laboratories (ISO/IEC 17025:1999)
10 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
// It is the first time in my life that I have
enjoyed taking a shower from water
piped directly to my home.
//
Ever since he can remember, Encik Jatin has had to make daily treks
to the river to collect water for his family’s basic needs. Even after
relocating from his Orang Asli village to the new settlement at Pulau
Indah, this laborious task continued.
Since taking over responsibility for water supply and distribution to
the consumers within the State of Selangor and the Federal Territories
of Kuala Lumpur and Putrajaya, the PNHB Group has strived to reach
out to all members of the community. By investing RM90,000 to lay
new pipes, water supply was piped directly to the Orang Asli
settlement in Pulau Indah for the first time.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 11
co r p o r at e p r o f i l e
Puncak Niaga Holdings Berhad
(PNHB) was incorporated on
7 January 1997 under the
Malaysian Companies Act, 1965
as a public company limited by
shares. It is an investment holding
company with interest in
infrastructure activities specialising
in water treatment engineering and
water-related activities.
PNHB was listed on the Main Board of Bursa Malaysia
on 8 July 1997. It is the first water treatment and supply
concession company to be listed on Bursa Malaysia
under the Infrastructure Project Company guidelines
issued by the Securities Commission.
As an investment holding company, PNHB acted as the
listing vehicle for Puncak Niaga (M) Sdn Bhd (PNSB), an
Infrastructure Project Company (IPC). PNSB is the
holder of two concessions awarded by the Selangor
State Government. The first, a Privatisation Cum
Concession Agreement (PCCA) awarded on 22
September 1994 allowed PNSB to take over, operate,
maintain, manage, rehabilitate and refurbish 27
existing water treatment plants formerly under the
management of Perbadanan Urus Air Selangor Berhad
(PUAS). The second concession, a Construction Cum
Operation Agreement (CCOA) was awarded on 22
March 1995 to finance, design, construct, operate,
manage and maintain a new 950 million litres per day
water treatment plant at Bukit Badong under the
Selangor State Government’s Sungai Selangor Water
Supply Scheme Phase 2 Project (SSP2). Both the PCCA
and CCOA provide for the concessions to expire on 31
December 2020.
Wisma Rozali at Shah Alam, Selangor
12 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
Under the CCOA, the development of the SSP2 Water Treatment
Today, PNSB is the largest water supply concessionaire in Malaysia.
Plant was undertaken in two stages. The first stage, with a
We operate, manage and maintain 28 water treatment plants with a
production capacity of 475 million litres per day, was completed in
total average production capacity of 1,868 million litres per day. This
October 1998, two months ahead of the commitment given to the
volume is equivalent to approximately 45.51% of the treated water
Selangor State Government. The second stage of the SSP2 Water
requirement in the State of Selangor Darul Ehsan and the Federal
Treatment Plant, with a production capacity of 475 million litres per
Territory of Kuala Lumpur.
day was originally scheduled for completion and commissioning on
1 January 2002. Instead, it was completed and commissioned one
On 15 December 2004, PNHB’s subsidiary, Syarikat Bekalan Air
year ahead of schedule on 1 January 2001.
Selangor Sdn Bhd (SYABAS) was granted a concession for a period
of 30 years, commencing from 1 January 2005 whereby SYABAS has
During the water crisis in 1998, PNSB was entrusted by the Federal
assumed all duties and functions of PUAS in the area of water
Government to finance, design and construct the Wangsa Maju
supply and distribution of water to the consumers within the State
Water Treatment Plant at a cost of RM122.0 million. This water
of Selangor and the Federal Territories of Kuala Lumpur and
treatment plant was completed in a record time of six months, an
Putrajaya involving a population of 7.1 million and industrial and
amazing feat by engineering standards. The abovementioned early
commercial users through 1.48 million consumer accounts, thus
completion of projects clearly exemplifies Puncak Niaga’s excellent
making it the biggest water supply privatisation in Malaysia.
capabilities in managing and undertaking large-scale water supply
projects in Malaysia.
View at Sungai Langat Dam
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 13
v i s i o n & M i s s i o n s tat e m e n t s
Our Mission
•
To provide a synergy of socio-economic products and
services in the realm of water treatment, management
and distribution and other related businesses.
•
To cater to the increasing challenges in the demand for
high quality water production and distribution through
the continuous implementation of high quality standards,
Our Vision
To Be The Leading And
Dynamic Integrated
Water Services Company
efficient services, human resources development,
innovative technology and operational systems.
•
To actively participate in regional and global business
opportunities with linkages to the Company’s core
activities and related interests.
•
To actively support and participate in programmes and
activities aimed at uplifting the community’s living
standards and value systems in line with the
aspirations of Vision 2020.
•
To address national and international concerns
pertaining to the protection, conservation and
enhancement of the natural environment we live in.
14 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
CO R P O R AT E S T R U C T U R E
Puncak Niaga Holdings Berhad
Investment Holding and
Provision of Management Services
Puncak Research Centre Sdn Bhd
100%
dormant
Puncak Seri (M) Sdn Bhd
100%
Puncak Niaga
(M) Sdn Bhd
100%
Ideal Water
Resources Sdn Bhd
100%
Unggul Raya
(M) Sdn Bhd
100%
operation, maintenance,
management, construction,
rehabilitation and
refurbishment of water
treatment facilities
ceased operations
ceased operations
dormant
Puncak Niaga (India) Sdn Bhd
100%
dormant
NS Water System Sdn Bhd
100%
dormant
Puncak Oil & Gas Sdn Bhd
70%
dormant
NS Water Management Sdn Bhd
40%
Syarikat Bekalan Air Selangor Sdn Bhd
70%
supply & distribution of treated water within Selangor &
the Federal Territories of Kuala Lumpur & Putrajaya and
other related services
Perbadanan Urus Air Selangor Berhad
100%
ceased operations
Poly Steel Pipe Sdn Bhd
30%
trader of steel pipes
dormant
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 15
O R G A N I s AT I O N S T R U C T U R E
Executive Chairman
YBhg Tan Sri Rozali Ismail
Executive Chairman’s Office
Senior General Manager
Encik Othman Ismail
Senior General Manager
Mr Ramalingam K.R. Arumugam
Senior General Manager
Encik Roslan Ibrahim
Senior General Manager
Encik Zon Abd Hamid
General Manager
Mr James Tan Chee Hau
General Manager
Mr Wong Cheong Keat
Secretarial
Senior General Manager
Madam Tan Bee Lian
Internal Audit
General Manager
Encik Sonari Solor
Managing Director
Encik Matlasa Hitam
OPERATION I DIVISION
FINANCE DIVISION
OPERATION II DIVISION
Executive Director
HUMAN RESOURCES &
ADMINISTRATION DIVISION
CORPORATE AFFAIRS DIVISION
Executive Director
Executive Director
Executive Director
Tuan Syed Danial Syed Ariffin
Mr Tan Seng Lee
Executive Director
Encik Nasir Khan Illadad Khan
Vacant
Encik Shaari Ismail
Operations of WTPs
Finance & Accounts
Operation II Division
Senior General Manager
Human Resources &
Administration
Legal
General Manager
Senior General Manager
Senior General Manager
Ir Ooi Cheng Swee
Mr Ng Wah Tar
General Manager
Madam Chan Siew Meei
Encik Abdul Jalil Abdul Karim
Vacant
26 WTPs
Compensation & Benefits
Senior Manager
Senior Manager
Manpower Services &
Industrial Relation
Strategic Resource Centre
Ir Ausamah Darwish
Encik Nik Azmi Nik Yaacob
Manager
General Manager
Major Project &
Upgrading Project
Dr Abd Rahim Awang Kechik
General Manager
Puan Poziah Abas
Ir Tan Hui Kuan
SSP2 WTP
Financial Accounting
Administration
Senior Manager
Manager
Manager
Corporate Communication
Puan Azlene Muhammad
Azaham
Encik Kamarulzaman Abu
Bakar
Business Development
Encik Azhani Sukimi
General Manager
Assistant General Manager
Encik Mohd Roslan Ali
Ir Ahmad Marzuki Hashim
Wangsa Maju WTP
Management Accounting
Protective Services
Plant Superintendant
Manager
Manager
Encik Bazalanul Azam Yusof
Encik Mohammad Shahree
Shamsuddin
Encik Saadon Kardi
Health, Safety & Quality
Management
Corporate Finance
General Manager
Encik Rozailan Rosli
Manager
Ir Dr Mohamed Aminudeen
Abdul Hamid
Puan Ramnah Mohd Ramli
Manager
Vacant
Manager
Encik Azreen Azman
Information Technology
Puan Roowina Merican A Rahim Merican
Senior Manager
Vacant
Puncak Niaga Holdings Berhad
Sabah Project
General Manager
Assistant General Manager
16 A N N U A L R E P O R T 2 0 0 5
Senior Manager
Training
Property Management
Water Resources &
Environmental Surveillance
& Process Improvement
Contract
Mr Seng Pay
Executive Chairman
YBhg Tan Sri Rozali Ismail
Executive Chairman’s Office
Executive Director
Encik Nik Danial Nik Mahmood
Internal Audit
General Manager
Vacant
Strategic Management, Audit & Recovery
Assistant General Manager
Encik Ismail Rusmin
Secretarial
Manager
Madam Lau Pueh Geok
Strategic Resource Centre
General Manager
Vacant
Chief Executive Officer
Encik Ruslan Hassan
Chief Operating Officer
Ir Lee Miang Koi
CORPORATE
COMMUNICATION
& CUSTOMER SERVICES
DIVISION
INFORMATION TECHNOLOGY
& COMMUNICATION
DIVISION
Executive Director
Executive Director
Executive Director
Encik Nik Danial
Nik Mahmood
Encik Ruslan Hassan
Encik Naemuddin Abdullah
FINANCE DIVISION
Executive Director
Mr Tan Seng Lee
HUMAN RESOURCES &
ADMINISTRATION &
LEGAL DIVISION
OPERATION DIVISION
Executive Director
PLANNING &
DEVELOPMENT DIVISION
Ir V. Subramaniam
Executive Director
Vacant
Customer Services
IT & Communication
Billing & Recovery
General Manager
General Manager
Senior General Manager
Human Resources &
Administration
Operation &
Maintenance
Project Management &
Development
Tuan Haji Md Wahid
Mohd Nor
Tuan Haji Mohd
Suhaimi Rafie
Madam Thein Kwee Sim
General Manager
General Manager
General Manager
Tuan Haji Zainuddin Othman
Tuan Haji Ariff Ibrahim
Vacant
Finance & Accounts
Legal & Enforcement
Water Quality
Senior General Manager
General Manager
Senior Manager
Non Revenue Water
(NRW)
Madam Wong Ley Chan
Ms Lalini Das
Vacant
Senior General Manager
Corporate
Communication &
Public Affairs
Ir Beh Men Huat
Senior Manager
Encik Abdul Halem
Mat Som
Northern Zone
Mechanical & Electrical
Planning & Design
Senior Manager
General Manager
Encik Hamdan Ahmad
Ir Lee Pak Lum
District
Contract & Procurement
Senior General Manager
Assistant General Manager
Vacant
Ir Nasir Ismail
Central Zone
Southern Zone
Gombak
Category A
Kuala Selangor
Category A
Klang
Category A
General Manager
General Manager
General Manager
Tuan Haji Yusof Saroji
Tuan Haji Mat Anuar Hasan
Tuan Haji Abd Rashid
Abd Satar
Kuala Selangor
Category C
Petaling
Category A
Senior Manager (Acting)
General Manager
Cik Maimunah Musa
Tuan Haji Muhamad Darif
Haji Idris
Sabak Bernam
Category C
Hulu Selangor
Category B
Assistant General Manager
Encik Jafar Muda
Senior Manager (Acting)
Kuala Langat
Category C
Tuan Haji Abdul Latip Mustafa
Senior Manager
Encik Ahmad Suhaidin Ismail
Hulu Selangor
Category C
Senior Manager
Tuan Haji Mustaffa
Haji Mohammed
Puncak Niaga Holdings Berhad
Sepang
Category C
Senior Manager
Encik Mokhtar Atan
A N N U A L R E P O R T 2 0 0 5 17
financial highlights
In RM'000
YEAR 2005
YEAR 2004
YEAR 2003
1,445,904
BALANCE SHEET
Property, plant and equipment
1,445,331
1,369,566
Project development expenditure
836,139
266,840
246,809
Other non-current assets
972,047
825,805
132,038
Current assets
1,615,574
665,678
1,342,384
Total assets
4,869,091
3,127,889
3,167,135
463,180
459,935
451,166
ISSUED AND PAID-UP CAPITAL
Share capital
Reserves
811,468
739,207
680,847
1,274,648
1,199,142
1,132,013
2.79
2.61
2.51
1,144,944
566,841
578,260
99,259
46,439
129,586
2,423,279
1,504,082
1,613,636
21.56
10.16
29.26
12
8
22
Gearing ratio
1.90
1.25
1.43
Current ratio
1.95
1.57
5.73
Shareholders' fund
Net assets per share (RM)
RATIOS AND STATISTICS
Turnover
Net profit after tax
Interest bearing debt
In sen
Earnings per share
In % of turnover
Operating profit
In times
f i n a n c i a l C A L E N DA R
Financial year end 31 December 2005
Announcement of results:
1st Quarter Results ended 31 March 2005
2nd Quarter Results ended 30 June 2005
3rd Quarter Results ended 30 September 2005
4th Quarter Results ended 31 December 2005
Book Closure Date for Payment of Final Dividend
Payment of Final Dividend of 5 sen less 28% income tax for the financial year ended 31 December 2005
Audited Accounts for the financial year ended 31 December 2005
Published Annual Report
23 November 2005
24 February 2006
15 July 2005
8 August 2005
20 April 2006
6 June 2006
9th Annual General Meeting
18 A N N U A L R E P O R T 2 0 0 5
25 May 2005
18 August 2005
28 June 2006
Puncak Niaga Holdings Berhad
financial &
share perfor mance
Financial Performance
01
4,869,091
05
3,127,889
04
2,867,388
03
2,700,365
02
3,167,135
01
99,259
05
46,439
04
Total Assets
RM’000
129,586
03
127,096*
1,144,944
01
124,499*
566,841
02
565,105
578,260
Profit After Taxation
RM’000
552,337
Turnover
RM’000
02
03
04
05
* These comparatives have been restated following the change in accounting policy on deferred tax in 2003 to comply
with the MASB Standard 25, ‘Income Taxes’
Share Performance
Share Price (RM)
KLCI
3.20
3.10
940
2.90
2.80
920
2.70
2.60
900
2.50
2.40
880
2.30
860
3.000m
2.000m
1.000m
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
Jan
2005
PNHB Monthly
Average Closing Prices
Feb
2006
Kuala Lumpur Composite Index (KLCI)
Monthly Average Closing Prices
Volume Of
Shares Traded
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 19
our role in the
wat e r s u p p ly s y s t e m
Policy, Planning, Enforcement and Survelliance by Goverment Agencies
Regulatory Authorities
Selangor Water
Management Authority
(LUAS)
Operators
Manages river basin
upstream beginning
3 nautical miles from the sea
Dam Operators in Selangor
Department of
Environment
(DOE)
Department of
Irrigation and Drainage
Malaysia
• Puncak Niaga (M) Sdn Bhd (PNSB)
• Syarikat Pengeluar Air Sungai
Selangor Sdn Bhd (SPLASH)
• Konsortium ABASS Sdn Bhd
Oversees enviromental issues
concerning rivers
Flood control and
river management
Rivers
(DID)
Dams
SCHEMATIC DIAGRAM OF WATER TREATMENT SYSTEM
RAW WATER
PUMP
BAND
SCREEN
GRIT CHAMBER
WTP Operators in Selangor
INTAKE
• Puncak Niaga (M) Sdn Bhd (PNSB)
• Syarikat Pengeluar Air Sungai
Selangor Sdn Bhd (SPLASH)
• Konsortium ABASS Sdn Bhd
CHLORINE
SODIUM SILICOFLOURIDE
MODIFIED LIQUID ALUM
HYDRATED LIME
FILTRATION TANK
AERATOR
FILTRATION
GALLERY
FLOCCULATION CHANNEL
SEDIMENTATION TANK
TREATED
WATER
PUMP
Selangor Water
Regulatory Department
MIXING CHANNEL
TO RIVER/SLUDGE
LAGOONS
(JKAS)
BULK
METERS
CLEAR WATER TANK
Water Supply Distributor
for Selangor,
Kuala Lumpur and Putrajaya
BOOSTER
STATION
RESERVOIR
Water Meter
(Condominium/
Flat)
20 A N N U A L R E P O R T 2 0 0 5
Water Meter
(Residential
Homes)
WATER
TOWER
Water Meter
(Industrial/
Factory)
Puncak Niaga Holdings Berhad
SERVICE
RESERVOIR
Syarikat Bekalan Air
Selangor Sdn Bhd (SYABAS)
Consumers
Water Meter
(Office)
Water Meter
(Government/
Institutional)
BALANCING
RESERVOIR
Water Meter
(Shopping
Centre)
// I rely on clean water, as my only source
of income is from operating a launderette.
I am so thankful at how fast the new
distributor dealt with my concerns over
yellowish water from the pipes.
//
For the past 15 years, Madam Sally Low operated a successful
launderette business in Petaling Jaya. A clean and consistent water
supply is her most cherished resource for the continued success of
her business.
When she discovered yellowish water from the water pipes in her
launderette, she contacted SYABAS, her new water distributor, to
complain about the problem. Within hours, the complaint was dealt
with and regular supply was restored much to her relief.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 21
b oa r d o f d i r e c t o r s o f
puncak niaga holdings berhad
//
YBhg Tan Sri Rozali Ismail
is the founder of PNSB, the
Executive Chairman and
substantial shareholder
of PNHB. He was appointed
to the Board of PNHB on
24 April 1997. //
YBhg Tan Sri Rozali Ismail, aged 49, Malaysian
Upon obtaining a Bachelor of Laws Degree from University of
Executive Chairman of PNHB Group
Malaya in 1981, YBhg Tan Sri Rozali Ismail began his career as Legal
Advisor with the Urban Development Authority (UDA) before joining
Bank Islam (M) Berhad in 1983. Together with a few pioneer bank
staff, he conceptualised the first institution of Islamic banking in
Malaysia. Subsequently, in 1987 he started his own legal practice as
an Advocate and Solicitor for 7 years, specialising in corporate,
property and banking works.
In 1989, YBhg Tan Sri Rozali Ismail set up a family-owned company
and embarked into the property development sector, with
involvement in several development projects in the Klang Valley,
Kuantan and Johor. Under the banner of Puncak Alam Housing Sdn
Bhd, he developed a new township known as Bandar Baru Puncak
Alam. The family-owned company also ventured into the utility
business in 1989 with the setting up of PNSB. Due to his vast
experience in various fields, he was entrusted by the Selangor State
22 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
Government, via PNSB, to manage the water treatment plants for
Partnership for Technology Management, FELDA Community Social
the whole of the State of Selangor Darul Ehsan and the Federal
Development Committee and Yayasan Budi Penyayang Malaysia. On
Territory of Kuala Lumpur. PNHB was subsequently incorporated in
17 April 2004, he was elected President of the Malay Chamber of
1997 as the holding company of PNSB and was listed on the Main
Commerce for the State of Selangor (2004/2008 Session). YBhg Tan
Board of Bursa Malaysia on 8 July 1997.
Sri Rozali Ismail was appointed advisor of the Business and
Accounting Faculty Council, University of Malaya for a term of 3
In recognition of his outstanding contributions in championing
years, on 21 May 2004. On 25 June 2004, he was appointed the
management excellence and best practices in the Malaysian water
Governor for Malaysia of Asia Pacific Marketing Federation (APMF)
and wastewater industry, YBhg Tan Sri Rozali Ismail was awarded
Foundation. On 24 September 2004, YBhg Tan Sri Rozali Ismail was
the prestigious Asia Water Management Excellence Award 2002 –
conferred an Honorary Doctorate in Complementary Medicines
Individual Award Category, an award at Asian level, by the Regional
(Humanity Services) by the Open International University for
Institute of Environmental Technology on 26 March 2002. He was
Complementary Medicines, Colombo, Sri Lanka.
conferred a Fellowship Award by the Institute of Marketing Malaysia
(IMM) on 6 November 2001 for his invaluable contributions to
Besides PNHB, YBhg Tan Sri Rozali Ismail is also the Executive
promote the growth and development of the Malaysian property
Chairman and major shareholder of 2 other listed companies,
market. On 16 January 2004, he was elected Advisor to IMM.
namely TRIplc Berhad, a property company and WWE Holdings Bhd,
YBhg Tan Sri Rozali Ismail was also honoured as a Top 10 Nominee
a leading wastewater engineering company in Malaysia. He is the
for the Ernst & Young Entrepreneur Of The Year – Malaysia 2002 and
Chairman of Gabungan Wawasan Generasi Felda, Executive
Malaysia 2003 (Master Entrepreneur Category) Award in recognition
Chairman of Syarikat Bekalan Air Selangor Sdn Bhd (SYABAS) and
of his outstanding entrepreneurship and leadership skills.
also sits on the Board of Perbadanan Urus Air Selangor Berhad
(PUAS).
YBhg Tan Sri Rozali Ismail is the past Deputy President of the
Malaysian Water Association (MWA) (2003/2005 Session) and sits on
YBhg Tan Sri Rozali Ismail is the Chairman of PNHBs ESOS Option
the Board of Universiti Utara Malaysia, a leading Malaysian
Committee. He is related to Encik Shaari Ismail (his elder brother),
university. He is an active member of various influential
PNSB’s Executive Director of Human Resources & Administration
governmental and non-governmental associations such as
Division who is also a substantial shareholder of the Company.
Malaysian Industry-Government Group for High Technology (MIGHT),
Malaysian Institute of Directors (MID), Malaysian-British Business
YBhg Tan Sri Rozali Ismail attended all the 5 Board Meetings of
Council, Malaysia-Indonesia Business Council, Corporate Malaysia
PNHB held in the financial year ended 31 December 2005.
Roundtable, Malaysia-Russia Business Council, Commonwealth
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 23
b oa r d o f d i r e c t o r s o f
puncak niaga holdings berhad
Encik Matlasa Hitam
Encik Ruslan Hassan
Encik Matlasa Hitam, aged 65, Malaysian
Managing Director of PNHB and PNSB
Encik Matlasa Hitam joined PNSB on 1 July 2003 as Executive
Director, Human Resources & Administration Division and was
appointed as Managing Director of PNHB and PNSB on 1 October
2005. He is a member of PNHB’s ESOS Option Committee and the
Head of Compliance, Internal Control and Risk Policy Committee
(CICR) and sits on the Board of several private companies.
Encik Matlasa holds a Bachelors Degree in Business Administration
(Hons) from Monmouth College, USA and a Masters Degree in
Business Administration (Finance) from Central Michigan University,
USA. He has more than 30 years’ senior management experience
covering areas related to manufacturing, marketing, human
resources, finance as well as contract and project management.
Encik Matlasa served as Managing Director/Chief Executive Officer
and Board member of both Petronas Methanol (L) Sdn Bhd and
Petronas Gas Supply (L) Sdn Bhd from 1992 to May 1996. Prior to
joining PNSB, he was the Executive Vice Chairman of WWE
Holdings Bhd.
Encik Matlasa attended 1 out of the 5 Board Meetings of PNHB held
in the financial year ended 31 December 2005 as he was only
appointed to the Board of PNHB on 1 October 2005.
Encik Ruslan Hassan, aged 50, Malaysian
Upon obtaining a Bachelor of Laws Degree from University of Malaya
Non-Independent Non-Executive Director of PNHB and
in 1981, Encik Ruslan began his career as Legal Advisor and later as
Chief Executive Officer of SYABAS
Senior Legal Counsel of Esso Production Malaysia Inc. In 1985, he
joined Pernas Sime Darby Holdings Sdn Bhd as Group Legal
Encik Ruslan joined PNSB on 1 November 1995 as Head of Corporate
Advisor/Company Secretary. Encik Ruslan has 6 years’ experience
Affairs Division. He was appointed to the PNSB Board on 26 December
as an Advocate and Solicitor. In 1993, he joined Rashid Hussain
1996, to the Board of PNHB on 24 April 1997, as the Executive Vice
Berhad as Corporate Affairs Senior General Manager and later
Chairman of PNHB on 6 April 1999. Upon securing the Selangor water
appointed as an Executive Committee Member. From November
distribution concession on 1 January 2005, Encik Ruslan Hassan was
1995 to February 2003, Encik Ruslan sat on the Board of Rashid
appointed as Chief Executive Officer of SYABAS. He resigned as a
Hussain Berhad and Rashid Hussain Securities Sdn Bhd and served
Director of PNSB on 30 September 2005 and was re-designated from
as an Audit Committee member of both companies as well as
Executive Vice Chairman and Executive Director, Corporate Affairs
various subsidiaries. He also sits on the Board of PUAS.
Division of PNHB to Non-Independent Non-Executive Director of PNHB
with effect from 1 October 2005.
Encik Ruslan attended all the 5 Board Meetings of PNHB held in the
financial year ended 31 December 2005.
Encik Ruslan was appointed a member of the Industrial Court –
Employer Panel for the period 1 January 2004 to 31 December 2006.
He is also a member of MID, MWA and IMM.
24 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
Tuan Syed Danial
Syed Ariffin
Ir Lee Miang Koi, aged 52, Malaysian
Non-Independent Non-Executive Director of PNHB and
Chief Operating Officer of SYABAS
Ir Lee joined PNSB in 1995 and was responsible for the project and
business development of PNHB. Ir Lee was appointed as a Director
of PNSB and PNHB on 2 February 1999 and 1 September 1999
respectively and Chief Operating Officer of SYABAS on 1 January
2005. He resigned as a Director of PNSB on 30 September 2005 and
was re-designated from Executive Director, Project and Business
Development Division of PNHB to Non-Independent Non-Executive
Ir Lee Miang Koi
Director of PNHB with effect from 1 October 2005. He is a member
of MWA, MID and IMM.
Ir Lee graduated as a civil engineer from University of Technology
Malaysia in 1978 and in 1989, he obtained a Masters Degree in
Environmental Engineering majoring in water supply and
wastewater engineering from the Asian Institute of Technology in
Bangkok. Ir Lee has 28 years’ experience in the water supply sector
and has held various positions during his tenure with the Public
Works Department as well as the Waterworks Department in
Malaysia, specializing in the field of water supply services. He was
previously a Senior Executive Engineer in the Design and Planning
of the Water Supply Branch in the Public Works Department
Headquarters and also Director of the Negeri Sembilan Waterworks
Department. He left the Public Works Department in 1991 to join
Ranhill Bersekutu Sdn Bhd, holding positions from Senior Engineer
to Vice President.
Ir Lee attended 4 out of the 5 Board Meetings of PNHB held in the
financial year ended 31 December 2005.
Tuan Syed Danial Syed Ariffin, aged 48, Malaysian
1991) and the Selangor Water Works Department between 1991 to
Executive Director, Operation I Division of PNHB and PNSB
1995, whereby he was the Senior Project Engineer overseeing the
construction of the Sungai Selangor Phase 1 Water Supply Project. He
Tuan Syed Danial graduated in 1981 with a BSc. (Hons) Degree in Civil
is a member of IMM, MWA, a Registered Engineer with the Board of
Engineering from University of Ashton in Birmingham, United
Engineers, Malaysia and also sits on the Board of several private
Kingdom. He is a civil engineer by profession and has been with the
companies.
PNHB Group since December 1995. He began his career with PNSB as
a Manager of Operation and was subsequently promoted to Senior
Tuan Syed Danial attended 4 out of the 5 Board Meetings of PNHB held
Manager, Assistant General Manager and General Manager of
in the financial year ended 31 December 2005.
Operation. Prior to his appointment to the Board of PNSB and PNHB
on 1 March 2004 (and subsequently re-designated as Executive
Director, Operation I Division on 1 April 2005) he was the Acting
Executive Director of Operation Division (July 2003 to February 2004).
He is a member of PNHB’s ESOS Option Committee.
Tuan Syed Danial previously worked with the Pahang Public Works
Department for 10 years, holding positions from Project Engineer
(1981-1983) to District Engineer for JKR Cameron Highlands (1983-
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 25
b oa r d o f d i r e c t o r s o f
puncak niaga holdings berhad
YBhg Tan Sri Dato’ Hari Narayanan Govindasamy,
aged 56, Malaysian, Independent Non-Executive Director of PNHB
Mr Tan Seng Lee
YBhg Tan Sri Dato’ Hari, a businessman was appointed to the Board
of PNHB on 1 July 1999 as an Independent Non-Executive Director.
YBhg Tan Sri Dato
Hari Narayanan
Govindasamy
He is a member of PNHB’s Audit Committee, Remuneration
Committee and Nomination Committee. He holds a Bachelors
Degree in Electrical and Electronic Engineering from University of
Northumbria, England.
YBhg Tan Sri Dato’ Hari is a member of the Institute of Engineers
Malaysia, MID and a Registered Professional Engineer with the
Board of Engineers, Malaysia. He has extensive experience in
electrical and electronic engineering and has held various key
positions with several established companies as an engineer and
entrepreneur. YBhg Tan Sri Dato’ Hari also sits on the Board of
Tenaga Nasional Berhad, SP Setia Berhad, Lembaga Lebuhraya
Malaysia, Asian Institute of Medicine, Science and Technology and
several private companies.
YBhg Tan Sri Dato’ Hari attended 4 out of the 5 Board Meetings of
PNHB held in the financial year ended 31 December 2005.
Mr Tan Seng Lee, aged 47, Malaysian
Mr Tan began his career as an auditor with a professional
Executive Director, Finance Division of PNHB and PNSB
accountancy firm, Messrs HRM – Arthur Andersen (1980-1986). In
1986, he joined Bumiputra-Commerce Finance Berhad as Manager,
Mr Tan was appointed to the Board of PNHB and PNSB on
Finance and Treasury and was subsequently promoted to Senior
1 September 2005. He is a Member of PNHB’s Audit Committee,
Manager and then Deputy General Manager, Financial Services and
Remuneration Committee and ESOS Option Committee.
Credit Control. Prior to joining the PNHB Group, Mr Tan was the Chief
Financial Officer of Proton Holdings Berhad for the period from
Mr Tan is a Chartered Accountant and Certified Public Accountant.
December 1999 to August 2005.
He is a member of the Malaysian Institute of Accountants (MIA), The
Malaysian Institute of Certified Public Accountants (MICPA) and a
Mr Tan attended 1 out of the 5 Board Meetings of PNHB held in the
Senior Associate of the Institute of Bankers Malaysia. He holds a
financial year ended 31 December 2005 as he was only appointed to
Master in Business Administration from Charles Sturt University,
the Board of PNHB on 1 September 2005.
Australia.
Mr Tan has more than 26 years of working experience in corporate
finance, accounting, auditing and banking. He has also been involved
in companies with operations in Europe, Australia, China and
Indonesia.
26 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
YB Tan Sri Dato’ Seri Dr Ting Chew Peh, aged 63,
Malaysian, Independent Non-Executive Director of PNHB
YB Tan Sri Dato’ Seri Dr Ting joined PNHB on 15 July 2000 as an
Independent Non-Executive Director and a member of the
Remuneration Committee and the Nomination Committee. Currently,
he is the Chairman of PNHB’s Audit Committee, and Compliance,
Internal Control and Risk Policy Committee. He graduated with a
Bachelor of Arts Degree from University of Malaya in 1970 and obtained
a Master of Science from University of London in 1972. He also holds a
Doctorate in Philosophy, which he obtained from University of Warwick
in 1976. YB Tan Sri Dato’ Seri Dr Ting is a member of MID.
YB Datuk Dr Rahman Ismail
YB Tan Sri
Dato’ Seri Dr
Ting Chew Peh
YB Tan Sri Dato’ Seri Dr Ting started his career as a lecturer in the
Faculty of Humanities and Social Sciences at Universiti Kebangsaan
Malaysia from 1974 to 1980 and was subsequently an Associate
Professor of the said Faculty until 1987. Between 1979 to 1986, YB Tan
Sri Dato’ Seri Dr Ting published two books entitled “Konsep Asas
Sosiologi” and “Hubungan Ras dan Etnik”.
In 1987, YB Tan Sri Dato’ Seri Dr Ting ventured into politics with his
election as a Member of Parliament for the Gopeng constituency, which
he holds until today. He previously served as Parliamentary Secretary of
the Ministry of Health (1988-1989), Deputy Minister in the Prime
Minister’s Department (1989-1990), Minister of Housing and Local
Government (1990-1999) and Secretary-General of Malaysian Chinese
Association (MCA) (1990-2005). He also sits on the Board of Pan
Malaysia Capital Berhad Group, Hua Yang Bhd, Pan Malaysia
Corporation Berhad, Johan Holdings Berhad and also serves as a
director of several private companies.
YB Tan Sri Dato’ Seri Dr Ting attended all the 5 Board Meetings of PNHB
held in the financial year ended 31 December 2005.
YB Datuk Dr Rahman Ismail, MD, PhD, aged 47, Malaysian,
until he was elected as a Member of Parliament for the Gombak
Independent Non-Executive Director of PNHB
constituency in March 2004.
YB Datuk Dr Rahman, joined PNHB on 3 January 2005 as an
YB Datuk Dr Rahman has conducted many studies in infectious
Independent Non-Executive Director and was appointed the
disease and vaccinology which were published in the local and
Chairman of the Remuneration Committee and Nomination
international journals. He is often invited to make presentations at
Committee and a member of the Audit Committee of PNHB,
the local and international medical conferences and has received
concurrently. He holds a Doctor of Medicine and Doctor of
many international recognitions and academic awards in his field of
Philosophy in Epidemiology. He is a committee member of the
expertise.
Academy of Medicine and the Advisor to the Public Health Specialist
Society. He attended post-doctoral courses at the Centre of Disease
YB Datuk Dr Rahman is currently the President of National University
Control Atlanta, USA and Pasteur Institute of France.
Medical Alumni, Chairman of the Parliamentarian Friendship Caucus,
Chairman of the Selangor Member of Parliament Association,
YB Datuk Dr Rahman started his career at the Kuala Lumpur General
President of the Selangor Professional Group and Secretary for the
Hospital before joining Aventis Pasteur International, the world’s
International Bureau of UMNO Supreme Council.
leading and renowned vaccine manufacturer. He was the Medical
and Research Director for Asia Pacific and member of the
He attended 4 out of the 5 Board Meetings of PNHB held in the
Management Committee with the company for 7 years since 1997
financial year ended 31 December 2005.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 27
senior m anagement in pnSb
Encik Nasir Khan Illadad Khan, aged 53, Malaysian
Executive Director, Corporate Affairs Division
Encik Nasir Khan joined PNSB in February 2006 as Executive Director, Corporate Affairs Division. He holds a Bachelor Degree in Social Science,
Political Science (Hons) from Universiti Sains Malaysia and a Masters Degree in Public Administration from Pennsylvania State University,
United States of America. He also possesses a Diploma in Public Management from National Institute of Public Administration (INTAN), and
attended an Executive Management Programme at the School of Government, Harvard University, United States of America.
Encik Nasir Khan has more than 29 years of management experience with the Government, holding various positions and covering areas of
human resources, security, land development and finance. Prior to joining PNSB, he was the Senior Assistant Director, Budget Division,
Ministry of Finance, Malaysia.
Encik Shaari Ismail, aged 51, Malaysian
Executive Director, Human Resources & Administration Division
Encik Shaari Ismail joined PNSB in March 2006 as Executive Director, Human Resources & Administration Division. Encik Shaari holds a
Masters Degree in Business Administration (MBA) majoring in Human Resource Management from University of Wales, United Kingdom.
Encik Shaari has more than 16 years of extensive management experience holding senior management positions covering areas of
administration, business management, management consultancy, property development, manufacturing as well as retail business. He was
previously the Group Personnel Director of Merge Power Sdn Bhd (1995 - 1998), Managing Director of Miniland Holding Sdn Bhd (1998 current) and Operation Director of Vetta Affari (M) Sdn Bhd (1998 - 2003). Encik Shaari is the elder brother of YBhg Tan Sri Rozali Ismail, the
Executive Chairman of PNHB Group. He is also a major shareholder of PNHB by virtue of his indirect equity interest in PNHB held through
Central Plus (M) Sdn Bhd and Corporate Line (M) Sdn Bhd.
Encik Abdul Jalil Abdul Karim, aged 42, Malaysian
Senior General Manager, Operation II Division
Encik Abdul Jalil joined PNSB in May 2006 as Senior General Manager, Operation II Divison. He holds a Degree in Mechanical Engineering from
University of Alabama, United States of America and is a Graduate of the Board of Engineers Malaysia. He has more than 18 years working
experience in the water and wastewater industry.
Encik Abdul Jalil started his career as a Site Mechanical Engineer with Taliworks Consortium Sdn Bhd in 1987 and was responsible for the
operation and maintenance of the Sungai Semenyih Water Treatment Plant. In 1994, he joined PNSB as Senior Executive Engineer responsible
for the operation and maintenance of the 27 Water Treatment Plants in Selangor. He left PNSB in 1996 to work in a few companies involved
in the construction and commissioning of water treatment plant refurbishment works and water and sewage treatment plant contract works.
In 2001, Encik Abdul Jalil joined Ranhill Berhad as Deputy Project Director. Prior to joining PNSB, he was the Project Director, Jeddah of WWE
Holdings Bhd.
Madam Chan Siew Meei, aged 49, Malaysian
Senior General Manager, Legal
Madam Chan joined PNSB as General Manager, Legal in May 1998. She obtained a Bachelor of Laws Degree from University of Malaya in
1981. Prior to joining PNSB, Madam Chan has served as an Advocate and Solicitor, lecturer, company secretary and legal adviser to two public
listed companies. Her employment portfolio covers diverse activities ranging from the timber and plantation sectors to engineering, property
and manufacturing. Madam Chan was promoted to her current position in January 2005.
28 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
Mr Ng Wah Tar, aged 42, Malaysian
Senior General Manager, Finance & Accounts
Mr Ng joined PNSB as General Manager, Finance & Accounts in March 2000 and was recently promoted to Senior General Manager, Finance
& Accounts on 1 April 2006. He commenced his articleship with an accounting firm in 1984 and is a member of MICPA and MIA. Mr Ng has
22 years of working experience in various areas covering auditing, accounting and finance. Prior to joining PNSB, he was with the
Management Services Division overseeing the finance and accounting functions of United Engineers (M) Berhad (UEM).
Encik Othman Ismail, aged 48, Malaysian
Senior General Manager, Executive Chairman’s Office
Encik Othman joined PNSB in April 2004 as General Manager and was promoted to Senior General Manager, Executive Chairman’s Office on
1 April 2006. He graduated from University of Wales, United Kingdom in 1999 with a Masters Degree in Business Administration. Encik Othman
has 15 years of working experience covering areas in marketing, sales and administration. Prior to joining PNSB, Encik Othman worked with
Edaran Otomobil Nasional Berhad and was the Operations Director of Gold Bridge Construction and Engineering Berhad.
Mr Ramalingam K. R. Arumugam, aged 59, Malaysian
Senior General Manager, Executive Chairman’s Office
Mr Ramalingam joined PNSB in August 1996 as an Executive in the Property Division and was promoted to General Manager in 2003. On 1
April 2006, Mr Ramalingam was promoted to Senior General Manager, Executive Chairman’s Office. Prior to joining PNSB, Mr Ramalingam
served the Government for more than 30 years in various departments in Selangor Darul Ehsan.
Encik Roslan Ibrahim, aged 46, Malaysian
Senior General Manager, Executive Chairman’s Office
Encik Roslan Ibrahim joined PNSB in October 2005. He graduated from University of Wales, United Kingdom in 1981 with a Bachelors Degree
in Civil Engineering and subsequently obtained a Masters Degree in Business Administration from Heriot-Watt University, United Kingdom in
2005. Throughout his career, Encik Roslan has had extensive experience in the construction industry in the areas of power, oil & gas, building
and infrastructure with more than 10 years working experience in senior management positions. Prior to joining PNSB, Encik Roslan was the
Managing Director of IJM Construction (Middle East) LLC which is based in Dubai.
Madam Tan Bee Lian, aged 40, Malaysian
Senior General Manager, Secretarial/Group Company Secretary
Madam Tan joined PNSB as Company Secretary in November 1994 and was promoted twice before assuming her current position as Senior
General Manager, Secretarial on 1 January 2003. She is a Fellow of the Malaysian Association of the Institute of Chartered Secretaries and
Administrators (MAICSA). Madam Tan has more than 18 years of working experience in company secretarial practice and had previously
worked with Projek Lebuhraya Utara-Selatan Berhad (PLUS) and Metramac Corporation Sdn Bhd/Metacorp Berhad. She is the winner of the
ROC-MAICSA Company Secretary Award 2001 for the Listed Company Category.
Encik Zon Abd Hamid, aged 51, Malaysian
Senior General Manager, Executive Chairman’s Office
Encik Zon joined PNSB in 2000 as Senior Manager, Executive Chairman’s Office and was promoted to Senior General Manager on 1 April 2006.
He holds a post graduate Diploma in Business Management from The Oxford Association of Management, United Kingdom and is currently
pursuing a MBA programme at The Oxford Association of Management, United Kingdom. Prior to joining PNSB, Encik Zon served 20 years in
various multinational corporations, specialising in agricultural engineering and turf maintenance engineering. He had attended various
courses and seminars in the United States of America, Australia, United Kingdom and Japan.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 29
senior m anagement in pnSb
Dr Abd Rahim Awang Kechik, aged 54, Malaysian
General Manager, Strategic Resource Centre
Dr Abd Rahim joined PNSB in July 2003 and currently heads the Strategic Resource Centre. Dr Abd Rahim holds a Doctorate in Philosophy
(Ph.D) in Business Management, a Bachelor of Arts (Hons) in Education, both from Universiti Sains Malaysia, a Master of Business
Administration from University of Wales College of Cardiff, United Kingdom, a Diploma in Public Management from National Institute of Public
Administration (INTAN) and a Diploma in Business Administration from University of Birmingham, United Kingdom. Prior to joining PNSB, he
was an Administrative and Diplomatic Officer with the Government since 1983 and has held various positions, namely in the Ministry of
Finance, Prime Minister’s Office, Ministry of International Trade and Industry (MITI), State Economic Planning Unit of the State of Negeri
Sembilan, Ministry of Agriculture, Ministry of Housing and Local Government and National Economic Action Council (NEAC).
Mr James Tan Chee Hau, aged 38, Malaysian
General Manager - Corporate Finance, Executive Chairman's Office
Mr James Tan joined PNSB in October 2005 as General Manager - Corporate Finance, Executive Chairman's Office. He graduated from RMIT
University, Australia with a Bachelor of Business (Accountancy) with Distinction in 1991. He obtained his Public Accountant membership and
Certified Practising Accountant membership from MIA and CPA Australia respectively in 1995. He has more than 14 years of working
experience in corporate finance, accounting and auditing. Prior to joining PNSB, he was the Director & Co-Head of Corporate Finance of
Malaysian International Merchant Bankers Berhad for about 10 years where he was involved in a diverse range of corporate finance
exercises. Prior to that, he worked with Messrs Ernst & Young, a public accounting firm, for more than 4 years where he was involved in the
audit of companies in various industries as well as some corporate finance related work.
Ir Dr Mohamed Aminudeen Abdul Hamid, aged 44, Malaysian
General Manager, Health, Safety and Quality Management
Ir Dr Mohamed Aminudeen joined PNSB on 1 August 2005 as General Manager, Health, Safety and Quality Management Department. He
graduated from Universiti Putra Malaysia with a Bachelor of Civil Engineering in 1988.
Ir Dr Mohamed Aminudeen also holds a Doctorate in Business Administration, Master in Business Administration, Diploma in Agriculture
Engineering and Diploma in Marketing Management. He is a Registered Professional Engineer with the Board of Engineers Malaysia and a
member of Institution of Engineers Malaysia, American Society of Civil Engineers, Project Management Institute (USA), American Society for
Quality, Institution of Highways and Transportation (UK), IMM and MIM.
He is experienced in the field of property development, construction, hospital management, project management, engineering, consultancy
works and has held senior positions in various organisations prior to joining PNSB.
Encik Mohd Roslan Ali, aged 46, Malaysian
General Manager, Corporate Communication
Encik Mohd Roslan joined PNSB in March 2006 as General Manager, Corporate Communication Department. He graduated with a Bachelor
of Arts (Honours) Degree majoring in Sociology from Universiti Kebangsaan Malaysia in 1984. He has more than 20 years of working
experience in public relations, publicity and the tourism industry. Prior to joining PNSB, he was the General Manager, Corporate
Communication Department of MK Land Holdings Bhd. He was posted for an overseas assignment as Director, Overseas during his
employment with Malaysian Tourism Promotion Board (MTPB) from 1990 to 1995.
30 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
Ir Ooi Cheng Swee, aged 52, Malaysian
General Manager, Operation I Division
Ir Ooi joined PNSB in January 2005. He graduated with a Bachelor of Civil Engineering (Hons) Degree from University of Malaya in 1978. Ir Ooi
has 28 years of working experience in infrastructure works, drainage, road and bridge engineering design, construction supervision of water
supply schemes, water supply distribution study and operations of water treatment plants. He is a Professional Engineer registered with the
Board of Engineers Malaysia and a member of Institution of Engineers Malaysia. Prior to joining PNSB, he was the General Manager
(Maintenance & Project) of CGE Utilities (M) Sdn Bhd.
Mr Seng Pay, aged 55, Malaysian
General Manager, Sabah Project
Mr Seng Pay joined PNSB in January 2004 and is assigned to oversee and manage the Group’s Telibong Water Supply Project in Sabah. He
graduated with a Diploma in Mechanical Engineering from the Singapore Polytechnic in 1976 and a Diploma in Management from MIM in
1988. He obtained a Masters Degree in Business Administration from Heriot-Watt University, United Kingdom in 1995. Mr Seng Pay has over
28 years of working experience in the management and implementation of water treatment plants. Prior to joining PNSB, he worked with
various organisations with his last employer being Ondeo Services (Malaysia) Sdn Bhd.
Encik Sonari Solor, aged 49, Malaysian
General Manager, Internal Audit
Encik Sonari Solor joined PNSB on 10 September 1998. He is a member of MIA and a fellow member of the Chartered Association of Certified
Accountants (UK). He also holds a professional qualification from the Chartered Institute of Management Accountants (UK). Encik Sonari has
more that 17 years of working experience in auditing and accountancy in public listed companies dealing in property development,
manufacturing, timber and consultancy services. Prior to joining PNSB, Encik Sonari was the Group Divisional Chief, Internal and Management
Audit of Land & General Berhad.
Ir Tan Hui Kuan, aged 52, Malaysian
General Manager, Operation II Division
Ir Tan joined PNSB in August 2003. He graduated with a Bachelor of Civil Engineering (Hons) Degree from University of Malaya in 1979. He
has 24 years of working experience in Jabatan Kerja Raya Malaysia and Lembaga Air Perak in the management of production, distribution,
maintenance and consumer services of a District Waterworks Department, geotechnical investigation, maintenance of military camps,
project management of military buildings and infrastructures. Prior to joining PNSB, Ir Tan was the Assistant Director for Military Works in
Jabatan Kerja Raya Malaysia.
Mr Wong Cheong Keat, aged 35, Malaysian
General Manager - Corporate Finance, Executive Chairman’s Office
Mr Wong joined PNSB on 1 November 2005. He has 15 years of working experience in investment banking and finance. He spent 6 years in
a leading public accounting firm and 9 years in investment banking in Malaysia and Singapore. Mr Wong holds a Bachelor of Arts
(Accountancy and Finance) from Heriot-Watt University, United Kingdom and is a Certified Public Accountant with MICPA and a Certified
Credit Professional of Institut Bank-Bank Malaysia.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 31
s e n i o r m a n a g e m e n t i n s ya b a s
Encik Nik Danial Nik Mahmood, aged 42, Malaysian
Executive Director, Executive Chairman’s Office and Information Technology & Communication
Encik Nik Danial holds a MBA from Eastern Michigan University, USA. He joined PNSB on 1 August 2005 as Executive Director for SYABAS
Project. Prior to joining PNSB, he was with DRB-HICOM Berhad (DRB) and his last position held was as Group Director of Corporate
Communications and Public Affairs Division of DRB. Previously, he has held several senior management positions in the subsidiary companies
of DRB including as Chief Executive Officer of Edaran Modenas Sdn Bhd.
Encik Naemuddin Hj Abdullah, aged 49, Malaysian
Executive Director, Corporate Communication and Customer Services
Encik Naemuddin joined PNSB on 1 April 2005 as Senior Manager, SYABAS Project. He was appointed as the Executive Director of Corporate
Communication and Customer Services Division of SYABAS on 1 January 2006. He holds a Bachelor of Arts from University of Malaya. Encik
Naemuddin has 15 years of working experience in the banking industry. He was with PNSB for the period from 1995 to 2001, where his last
position held was Assistant General Manager (Human Resource). He was actively involved in the privatisation exercise of Jabatan Bekalan
Air Selangor (JBAS), now known as Perbadanan Urus Air Selangor Berhad (PUAS) and the setting up of Pusat Perkhidmatan Pelanggan
(PUSPEL).
Ir V. Subramaniam, aged 55, Malaysian
Executive Director, Operation
Ir V. Subramaniam is the Executive Director, Operation of SYABAS. He has worked with JBAS since 1991 and continued his services with PUAS
(2002-2004). He holds a Bachelor of Engineering (Hons) (Civil) Degree from University of Malaya. Ir V. Subramaniam has served in the Public
Works Department/Water Supply Department/PUAS/SYABAS in various capacities for the past 32 years since graduation in 1974. He has vast
experience in managing water supply and privatization of water supply.
Ir V. Subramaniam successfully handled the 1998 Water Crisis in Selangor and Kuala Lumpur and published a complete documentation on
the management of the water crisis. He has written and presented many papers on Privatisation/Corporatisation on water supply and on
other related technical subjects at local and overseas seminars and conferences. He has also assisted the Asian Development Bank (ADB),
in his capacity as ADB’s domestic consultant, in several studies on water supply in the Asian cities.
Ir V. Subramaniam was awarded the Darjah Kebesaran Setia Mahkota Selangor (SMS), Darjah Kebesaran Setia – Sultan Salahuddin Abdul Aziz
Shah (SSA), Ahli Mangku Negara (AMN) and Pingat Jasa Kebaktian (PJK) (Terengganu), for his dedication and service to the state and the nation.
Ir Beh Men Huat, aged 50, Malaysian
Senior General Manager, NRW
Ir Beh Men Huat holds a Bachelor of Civil Engineering (Hons) Degree from University of Strathclyde, Scotland and subsequently in 2003,
obtained a Master of Finance Degree from RMIT University, Australia. He is a member of the Institution of Engineers Malaysia, Malaysian
Institute of Management (MIM), and MWA. Prior to joining SYABAS, Ir Beh had served in PNSB since February 1996 and his last position in
PNSB was Executive Director, Project & Business Development Division. He has also worked with Lembaga Lektrik Negara (now known as
Tenaga Nasional Berhad), Jabatan Kerja Raya, Lembaga Air Perak and Salcon Engineering Bhd.
32 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
Madam Wong Ley Chan, aged 46, Malaysian
Senior General Manager, Finance & Accounts
Madam Wong joined PNSB in March 2005 as General Manager, Finance & Accounts of SYABAS and was recently promoted to Senior General
Manager, Finance & Accounts of SYABAS on 1 April 2006. Madam Wong graduated with a Degree in Bachelor of Accountancy from National
University of Singapore in 1981. She is a member of MICPA and MIA, having more than 20 years of working experience in auditing, corporate
banking and corporate debts restructuring, corporate finance, accounting and corporate taxation. Madam Wong had previously served in
several companies at senior management level, including a 6-year-stint in Renong Group of Companies and 5 years in TRIplc Bhd (formerly
known as U-Wood Holdings Berhad). She was the Chief Financial Officer of AIC Corporation Bhd prior to joining PNSB.
Madam Thein Kwee Sim, aged 42, Malaysian
Head, Billing & Recovery
Madam Thein holds a professional qualification from MICPA and has been a member of MICPA and MIA since 1992. Madam Thein has more
than 20 years of working experience in various areas covering auditing, group accounting, corporate debt restructuring and corporate
finance. Prior to joining SYABAS, Madam Thein was with the Renong Group of Companies for a total of 7 1/2 years where she served in United
Engineers (Malaysia) Berhad (1992 – 1997) overseeing the group finance and accounting functions and HBN Management Office (1997 - 1999)
where her role was to monitor the financial performance of the listed companies under the Renong Group in addition to the debt
restructuring of several companies under the Renong Group subsequent to the financial crisis of 1997. In early 2000, she joined Jendela
Permai Sdn Bhd, a financial consultancy company prior to joining SYABAS in May 2005.
Mr Albert Loh Thiam Hock, aged 52, Malaysian
General Manager, Leak Detection Specialist, NRW
Mr Albert Loh joined SYABAS on 14 February 2005 as a Leak Detection Specialist with the NRW Department. He graduated with a BSc
(Hons) from University Sains Malaysia in 1978 majoring in Geophysics. Prior to working with SYABAS, he was employed by an engineering
company in Melbourne undertaking water resource investigation, pipe condition assessment and leak detection services in Australia.
He had also worked with Malaysia Mining Corporation Bhd from 1981 - 1997 in exploration & mining, oil & gas and utility projects, both
locally and overseas.
Tuan Haji Ariff Ibrahim, aged 45, Malaysian
General Manager, Operation & Maintenance
Tuan Haji Ariff joined PNSB in January 2005 and was assigned to SYABAS as General Manager, Operation & Maintenance in January 2006. He
graduated with a Bachelor of Civil Engineering (Hons) Degree from Universiti Teknologi Malaysia in 1984 and subsequently obtained a Masters
Degree in Business Administration from Universiti Kebangsaan Malaysia in 2001. Tuan Haji Ariff has more than 20 years of working experience
in the water industry such as operation and maintenance of water treatment plants, operation and maintenance of water supply,
construction supervision of water supply schemes, safety and health and also human resource and administrative matters. Prior to joining
PNSB, he worked with JBAS and CGE Utilities (M) Sdn Bhd.
Tuan Haji Abd Rashid Abd Satar, aged 45, Malaysian
General Manager, Klang/Shah Alam District Office
Tuan Haji Abd Rashid holds a Diploma of Civil Engineering from Universiti Teknologi Malaysia and a Bachelor of Civil Engineering from
University of Glasgow, Scotland. He has 23 years of working experience in the water supply sector. He began his career in 1981 as a Technical
Assistant with JBAS and continued his service with PUAS (2002 - 2004) as Senior Manager Kuala Selangor/Sabak Bernam and Kuala
Langat/Sepang District respectively. He is now the General Manager, Klang/Shah Alam District Office.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 33
s e n i o r m a n a g e m e n t i n s ya b a s
Mr Koh Eng Seng, aged 53, Malaysian
General Manager, Project Management & Development
Mr Koh holds a Diploma of Civil Engineering from Institut Teknologi Kebangsaan and a Bachelor of Civil Engineering from Universiti Teknologi
Malaysia and Master of Science (Engineering) from University of Texas. He has 27 years of working experience in public works and the water
supply sector. He began his career in 1977 as a civil engineer with Jabatan Kerja Raya, holding various positions until 1991. Thereafter, he
joined JBAS as a senior engineer and continued his service under PUAS (2002 - 2004). He is now the General Manager, Project Management
& Development.
Ms Lalini Das, aged 46, Malaysian
General Manager, Legal & Enforcement Division
Ms Lalini Das joined SYABAS in May 2006. She obtained a Bachelor of Laws Degree from University of London (Ext) in 1984 and a Certificate
of Legal Practice from University of Malaya in 1985. During the course of her 21 year career, Ms Lalini has served as an Advocate & Solicitor,
Legal Consultant and Legal Advisor to 4 public listed companies. Her work experiences had encompassed various areas ranging from
franchising, intellectual property rights and corporate finance to project management, investments and cross-border transactions.
Ir Lee Pak Lum, aged 41, Malaysian
General Manager, Planning & Design
Ir Lee joined SYABAS on 8 August 2005 as General Manager. He graduated from Monash University, Melbourne, Australia with a Bachelor of
Engineering (Civil) in 1989. Ir Lee has 16 years of working experience in the water supply industry, covering areas of feasibility studies,
engineering design and project management in water resource development, water treatment, distribution system and network modelling.
Prior to joining SYABAS, Ir Lee was an Associate Director with Sepakat Setia Perunding Sdn Bhd, a large multi-displinary engineering
consultancy firm.
Tuan Haji Mat Anuar Hasan, aged 52, Malaysian
General Manager, Kuala Lumpur District Office
Tuan Haji Mat Anuar holds a Diploma of Civil Engineering from Universiti Teknologi Malaysia and Bachelors Civil Engineering from Polytechnic
of Central London. He has 25 years of working experience in public works and the water supply sector. He began his career as a Civil Engineer
with Jabatan Kerja Raya and was posted to Kuala Kangsar, Hulu Langat and Hulu Selangor Districts. In 1991, he was transferred to
Kementerian Pengangkutan as a Civil Engineer until 1993. He was transferred back to Jabatan Kerja Raya, Terengganu and subsequently
joined JBAS as a Civil Engineer in 1998 and continued his service with PUAS (2002 - 2004). He is now the General Manager, Kuala Lumpur
District Office.
Tuan Haji Md Wahid Mohd Nor, aged 46, Malaysian
General Manager, Customer Services Division
Tuan Haji Md Wahid holds a Bachelor of Civil Engineering from University of Malaya. He has 22 years of working experience in public works
and the water supply sector. He began his career in 1984 as a Civil Engineer with Jabatan Kerja Raya and held various positions during his
tenure there until 1991. Thereafter, he joined JBAS as District Engineer of Hulu Langat District and continued his service with PUAS (20022004) as Senior Manager, Klang District and Senior Manager, Petaling District in year 2005. He is now the General Manager, Customer Services
Division.
34 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
Tuan Haji Muhamad Darif Haji Idris, aged 50, Malaysian
General Manager, Petaling District Office
Tuan Haji Muhamad Darif holds a Bachelor of Civil Engineering from University of Aberdeen, Scotland and Ordinary National Diploma (Building)
from Southamptom Technical College, England. He has 26 years of working experience in public works and the water supply sector. He began
his career as a Civil Engineer with Jabatan Kerja Raya. He was transferred to JBAS as Civil Engineer at Hulu Langat District and continued his
service with PUAS (2002 - 2004) as Senior Manager, Operation Division. He is now the General Manager, Petaling District Office.
Tuan Haji Mohd Suhaimi Rafie, aged 49, Malaysian
General Manager, Information Technology & Communication
Tuan Haji Mohd Suhaimi holds a Diploma, Advanced Diploma of Civil Engineering and a Bachelor of System Analyst from Universiti Teknologi
Mara. He has 26 years of working experience in public works and the water supply sector. He began his career in 1979 as a Civil Engineer
with Jabatan Kerja Raya, holding various positions until 1991. Thereafter, he joined JBAS as a Civil Engineer and continued his service under
PUAS (2002 - 2004). He is now the General Manager, Information Technology & Communication Division.
Tuan Haji Yusof Saroji, aged 39, Malaysian
General Manager, Gombak District Office
Tuan Haji Yusof holds a Diploma and Advanced Diploma of Civil Engineering from Universiti Teknologi Malaysia. He has 16 years of working
experience in the water supply sector. He began his career in 1988 as a Technical Assistant with JBAS and continued his service with PUAS
(2002-2004) as Senior Manager of Kuala Selangor/Sabak Bernam District Office. He is now the General Manager, Gombak District Office.
Tuan Haji Zainuddin Othman, aged 46, Malaysian
General Manager, Human Resources & Administration
Tuan Haji Zainuddin joined SYABAS on 1 April 2005 as General Manager, Human Resources & Administration Division. He holds a Diploma in
Public Administration from UiTM and a Master of Science in Human Resource Management from University of Lincolnshire and Humberside,
United Kingdom. He is an Associate member of MIM. He has more than 20 years of working experience in the areas of human resources
management and general office administration.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 35
co r p o r at e a c h i e v e m e n t s
ASIA WATER 2006:
Asia’s No. 1 Water & Wastewater Industry Event
Best @ Show Award Winner: Most Popular Booth
Puncak Niaga Holdings Berhad
21 - 24 March 2006
‘SAMBUTAN BULAN IT SELANGOR’
Anugerah Inovasi ICT
Setiausaha Kerajaan Negeri Selangor bagi Tahun 2004
& Piala Pusingan Setiausaha Kerajaan Negeri Selangor
Winner for the Gerbang e-Mesra: Portal Enterprise
PUAS Berhad Project
27 January 2005
National Annual Corporate Report Awards (NACRA) 2005
Industry Excellence Award under the
Construction & Infrastructure Project Companies’ Category
Puncak Niaga Holdings Berhad
29 November 2005
CERTIFICATE OF
ACCREDITATION FOR THE
COMPETENCE OF
TESTING LABORATORIES
ISO/IEC 17025:1999
SSP2 WTP
ENVIRONMENTAL MANAGEMENT SYSTEM CERTIFICATION
ISO 14001:2004
SSP2 WTP
OCCUPATIONAL HEALTH AND SAFETY
MANAGEMENT SYSTEM CERTIFICATION
OHSAS 18001:1999
SSP2 WTP
QUALITY MANAGEMENT SYSTEM
CERTIFICATION
ISO 9001:2000
SSP2 WTP
36 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
CERTIFICATE OF PARTICIPATION FOR
ACCA MALAYSIA ENVIRONMENTAL AND
SOCIAL REPORTING AWARDS 2005
Puncak Niaga Holdings Berhad
28 April 2006
// My children have given
me the responsibility
to look after their children.
My grandchildren’s
health and hygiene are
my main concerns.
//
Puan Surayah was extremely pleased to have the company of her three
young grandchildren living in her home. However, she felt worried that
the frequent disruption in water supply due to pipe bursts and low
water pressure in her neighbourhood may adversely affect the
childrens health.
Since taking over responsibility for water supply and distribution in the
State of Selangor and the Federal Territories of Kuala Lumpur and
Putrajaya, SYABAS has been able to successfully address this
grandmother’s concern by replacing the old pipes with new pipes and
implementing more stringent measures to address low water pressure.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 37
executive chair man speaks
//
The year 2005 has
been truly significant
for the PNHB Group,
it being the year that
we can truly call the
PNHB Group the
‘Leading and Dynamic
Integrated Water
Services Company’. //
Tan Sri Rozali Ismail
Executive Chairman
of PNHB Group
38 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
Dear Shareholders,
We realised our goal of adding water distribution services to
complete our business portfolio as the year 2004 came to a close.
It is my pleasure to present, on behalf of the Board of Directors of
On 15 December 2004, SYABAS signed an agreement with the
Puncak Niaga Holdings Berhad (PNHB), the Annual Report and
Selangor State Government and the Federal Government in regard
Audited Financial Statements of the Group and Company for the
to the privatisation of water distribution services in the State of
financial year ended 31 December 2005.
Selangor and the Federal Territories of Kuala Lumpur and Putrajaya
for a 30-year concession period. The privatisation involved SYABAS’
Financial Review
100% acquisition of PUAS from the Selangor State Government,
Our 70%-owned subsidiary, Syarikat Bekalan Air Selangor Sdn Bhd
covering all moveable assets of PUAS as well as approximately
(SYABAS), commenced business operations on 1 January 2005. With
1,700 PUAS employees. The takeover of the functions and
the consolidation of SYABAS’ accounts, the Group’s revenue mainly
operations of PUAS by SYABAS was marked by a ceremony,
represents billings by SYABAS to the consumers for the distribution
officiated by the Menteri Besar of Selangor, YAB Dato’ Seri Dr
of treated water. The Group’s revenue increased by 102.0% to
Mohamad Khir Toyo, on 1 January 2005.
RM1,144.9 million in 2005 from RM566.8 million in 2004.
In order to finance the massive capital expenditure programme
The net profit attributable to the Group for the financial year ended
under the privatisation, SYABAS had, on 19 September 2005, signed
31 December 2005 increased significantly from RM46.4 million in
a RM3 billion Bai Bithaman Ajil Islamic Securities facilities
2004 to RM99.3 million, resulting in an improved basic earnings per
arrangement with a consortium of banks comprising Bank Islam
share of 21.6 sen (2004: 10.2 sen).
Malaysia Berhad, Bumiputra-Commerce Bank Berhad, Commerce
International Merchant Bankers Berhad and HSBC Bank Malaysia
Dividend
Berhad, constituting the largest bond issuance undertaken in
In view of the Group’s commendable financial performance, the
Malaysia in 2005.
Board of Directors is recommending a Final Dividend of 6 sen per
share less 28% tax for the financial year ended 31 December 2005,
In the last quarter of 2005, PNSB undertook the restructuring of its
compared to 5 sen per share less 28% tax for the previous financial
existing financing facilities by extending the tenure of its Al-
year. The entitlement and payment dates for the Final Dividend will
Murabahah Commercial Papers and Al-Murabahah Medium Term
be determined later by the Board. As in the previous year, no Interim
Notes by another two years, from October 2005 to October 2007,
Dividend was declared during 2005.
and extending its Al-Bai Bithaman Ajil Bonds with a put and call
option attached.
Corporate Developments
The year 2005 has been truly significant for the PNHB Group, it being
The management and performance of water treatment and
the year that we can truly call the PNHB Group the ‘Leading and
distribution activities undertaken by PNSB and SYABAS respectively
Dynamic Integrated Water Services Company’. In line with our
are set out in the Operations Review section of this Annual Report.
corporate vision, we are now involved in the full cycle of the water
business value chain, from the treatment of water to its distribution
Business Prospects
to the consumers.
The commencement of business operations by SYABAS on 1
January 2005 has enabled the Group to tap the full revenue
Our Group has progressed a long way since 22 September 1994
potential from the water business value chain. SYABAS is
when we first signed the Privatisation cum Concession Agreement
responsible for the distribution of water services to about 7.1
for the 26 water treatment plants (WTPs) that were formerly under
million people through 1.48 million consumer connections and all
the management of Perbadanan Urus Air Selangor Berhad (PUAS).
commercial and industrial premises in the State of Selangor and the
Since midnight of 31 December 2004, Puncak Niaga (M) Sdn Bhd
Federal Territories of Kuala Lumpur and Putrajaya. The average
(PNSB), our wholly owned subsidiary, has been in direct operation
water demand in year 2005 is about 3,700 million litres per day. For
and management of the 26 WTPs following the exit of the
the financial year ended December 2005, the total consumer
subcontractor, CGE Utilities (M) Sdn Bhd, who had been overseeing
accounts generated revenue of RM1,070.3 million, an indication of
the operations of the WTPs since January 1995. With this
constant contribution to the Group’s profitability in the years ahead.
development, PNSB is now directly responsible for the management
and operation of 28 WTPs in the State of Selangor and the Federal
Territory of Kuala Lumpur, including the Sungai Selangor Phase 2
and Wangsa Maju WTPs.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 39
executive chair man speaks
Under the 9MP (2006-2010), we expect the allocation for the water
supply sector by the government and development expenditure by
other water supply authorities and the private sector to be higher
than that provided under the 8MP. This expectation is based on
several factors:
• Demand for water is continually increasing and is estimated
to be about 4-6% annually;
• The implementation of the multi-billion dollar PahangSelangor Interstate Raw Water Transfer Scheme is impending
and while awaiting its completion, smaller schemes will be
implemented to meet demand in the interim period;
• There is growing emphasis on reducing non-revenue water
losses, which will require investment programmes including
the massive replacement of old and leaking pipes and old
water meters;
• Low rainfall during 2005 had resulted in very low storage
Klang Gates Dam
levels recorded in many impounding reservoirs in Malaysia,
PNSB’s turnkey water project in Telibong and Telipok, Sabah, is
which in turn had caused water rationing to be implemented
progressing according to schedule, with 30% of the construction
in some parts of the country. This will prompt the
completed as at end-2005. This project, with a contract sum of
development of more water resources development projects
RM313.5 million, involves the planning, design, construction,
in Malaysia;
supervision, testing and commissioning of a new intake and raw
water pumping station, water treatment plant, off-river storage,
reservoirs and 45 km of steel pipelines.
• Continual pollution of available water resources is expected
to prompt the water supply sector to invest in water resource
development projects, including the construction of dams
In January 2005, PNHB and its business partners successfully
and inter-basin water transfer systems; and
completed the construction of the Chennai Water Supply
Augmentation Project 1 – Package III, awarded in November 2002.
• The passing of the new Water Bills will place pressure on the
The five-year operation and maintenance of the Chennai water
need to upgrade the level of water supply services, leading to
supply system commenced on 19 January 2005.
the need to rehabilitate and upgrade the existing WTPs and
distribution systems.
During the year 2005, the Group continued to explore water-related
business opportunities in other parts of the country as well as
The new Water Bills, namely the Water Services Industry Bill 2005
overseas, in particular, the Kingdom of Saudi Arabia. The business
and the National Water Services Commission Bill 2005, are likely to
venture into the Kingdom of Saudi Arabia was undertaken in
be passed by Parliament and implemented in 2006. The new Water
collaboration with a leading wastewater treatment company in
Bills aim to streamline and regulate water supply services for all
Malaysia, WWE Holdings Bhd, and the Group hopes to clinch some
states in Peninsular Malaysia and Labuan. At present, these services
deals in 2006.
are under the purview of the various state governments and, in the
case of Labuan, under the Federal Government.
Industry Outlook
Two significant events will be critical in determining the outlook for
The passing and implementation of the new Water Bills will have far-
the water supply industry and the PNHB Group’s business prospects
reaching impact on the development and management of the water
over the next few years. These are the implementation of the Ninth
supply services sector in the country. There will be new benchmarks
Malaysia Plan (9MP) and the impending passing by Parliament of the
on water supply services standards that will provide the impetus
Water Services Industry Bill 2005 and the National Water Services
towards better management of water supply services as well as
Commission Bill 2005 (new Water Bills).
greater investment in upgrading the industry. A new organisation,
40 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
the Water Asset Management Company (WAMCO), will be
financiers, whose continuing support has enabled us to grow and
established by the Federal Government to make funding for water
create value for our business.
development projects more easily available and at cheaper rates.
Last but not least, the Board of Directors and I extend our gratitude
The new Water Bills and the 9MP will therefore create greater
to the Federal Government and the Selangor State Government, as
prospects and more opportunities for market players in the water
well as the various government authorities, agencies and non-
supply sector in 2006 and the coming years. This augurs well for the
governmental organisations. Their guidance and assistance in our
PNHB Group, being the single largest privatised water company in
projects have helped us in realising our goals and objectives.
Malaysia with established expertise and resources. The PNHB Group
is in the best position to capitalise on these developments for the
We look forward to everyone’s continued cooperation and
benefit of its stakeholders.
collaboration as we forge ahead in consolidating our position as
Malaysia’s Leading and Dynamic Integrated Water Services
Acknowledgements
Company.
As in all endeavours, our achievements during the financial year
under review would not have been possible without the efforts and
contributions of many groups of people. Our Management team and
employees have risen well to meet the challenges that faced us,
and on behalf of the Board of Directors of PNHB, I wish to record our
Tan Sri Rozali Ismail
appreciation to them for their commitment and hard work.
Executive Chairman
The Board of Directors and I would like to convey our deepest
20 April 2006
appreciation to our customers, end-users and stakeholders. Their
confidence in our Group has motivated us to strive to provide
services of consistently high quality from year to year. Our thanks
also go to our associates, business partners, suppliers and
Board of Directors of
Puncak Niaga Holdings Berhad
Seated front row:
YBhg Tan Sri Rozali Ismail and Encik Matlasa Hitam
Standing from left to right:
Ir Lee Miang Koi, Mr Tan Seng Lee, Encik Ruslan Hassan, Tuan Syed Danial Syed Ariffin, YBhg Tan Sri Dato’ Hari Narayanan Govindasamy,
YB Tan Sri Dato’ Seri Dr Ting Chew Peh and YB Datuk Dr Rahman Ismail
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 41
o p e r at i o n s r e v i e w : P N S B
wat e r t r e at m e n t a c t i v i t i e s
WATER TREATMENT PLANTS (WTPS)
Wangsa Maju WTP
Puncak Niaga (M) Sdn Bhd (PNSB), PNHB’s wholly-owned subsidiary,
operates, manages and maintains 28 WTPs with a total average
production capacity of 1,882 million litres per day, making the
company the largest water supply concessionaire in Malaysia.
Sungai Selangor Phase 2 (SSP2) WTP
Check on the aeration process at Wangsa Maju WTP
In 2005, the Wangsa Maju WTP produced 17.34 million cubic metres
of treated water, an increase of 3.8 % from 16.7 million cubic metres
in the previous year. Average daily production was 47.5 million litres
against 45.9 million litres recorded in 2004. The plant operated
through the year under review without any major interruptions,
mainly due to the staff’s strong commitment and diligent execution
of the scheduled maintenance programme.
LRQA conducted two surveillance audits of the plant’s operations in
SSP2 WTP
2005 and, with no non-conformance noted, the ISO 9001:2000
For the year under review, the SSP2 WTP recorded a total
Quality Management System certification was maintained. During
production of 325.01 million cubic metres of treated water, an
the year under review, the WTP carried out a number of activities as
increase of 1.7% from the previous year. Average daily production
part of its continual plant improvement and enhancement
also increased from 875.72 million litres in 2004 to 890.44 million
programme. These included introducing a colour-coding system at
litres in 2005. Due to strong teamwork and adherence to a strict
the work area, repainting works and scheduled cleaning of tanks.
plant maintenance schedule, there were no major plant
interruptions during the year and the WTP consistently fulfilled the
WTPs Under the Privatisation Cum Concession Agreement
production demand as well as the specified treated water quality.
(PCCA)
The 26 WTPs achieved a total production of 339.99 million cubic
In terms of certification, the SSP2 WTP successfully maintained its
metres of treated water in 2005, a 16.0% decrease from 402.38
Integrated Management System (IMS) certification by Lloyd’s
million cubic metres produced in 2004. The decrease was due to the
Register Quality Assurance (LRQA), comprising the Quality
reduction of the Sungai Langat and Bukit Nanas WTPs production
Management System ISO 9001:2000, Environment Management
whilst maximising production of the SSP2 WTP in view of the need
System ISO 14001:1996, and Safety Management System ISO
to conserve the water drawdowns from the Sungai Langat and
18001:1999. Following a compliance audit by LRQA conducted on
Klang Gates Dams. The average monthly production recorded during
10 and 11 November 2005, the ISO 14001:1996 certification was
the year under review was 28.33 million cubic metres, which was
upgraded to ISO 14001:2004.
7.8% above the designated monthly quantity of 26.28 million cubic
metres.
On 12 December 2005, the Department of Standards Malaysia
a compliance audit for accreditation to ISO/IEC
Various measures have been taken to improve production
17025:1999 (The Competence Of Testing Laboratories). The SSP2
performance of the 26 WTPs. At the Sungai Pangsoon WTP, a
WTP’s laboratory was recommended for accreditation to ISO/IEC
Claribloc Unit was installed in June 2005 and commissioned in
17025:1999 and the certificate was recently issued in April 2006.
September 2005. The Claribloc
conducted
is a compact treatment unit
comprising coagulation, flocculation, settling, filtration and chemical
42 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
dosing systems. Currently serving as support/back-up to the
the Privatisation cum Concession Agreement (PCCA) dated
existing plant, it is operated when the raw water turbidity is high or
31 December 2004.
when there is high demand, thus ensuring continuous production of
treated water. An additional clarifying system, Actiflo, was installed
The dams are operated using the established Operational Rule
at the Cheras Mile 11 WTP to enhance the plant’s treatment
Curve. Rainfall levels in the dams’ catchment areas are regularly
capability. The installation of the Actiflo was completed in December
monitored to assess the possibility of critical storage drawdown at
2005 and commissioned in January 2006.
any of the dams. The overall performance for 2005, based on rainfall
and demand from the WTPs, was good and manageable without
There has been a marked decrease in total shutdown hours at the
critical storage drawdown at any of the three dams.
26 WTPs, from 2,769.92 hours in 2004 to 1,825.09 hours in 2005.
Raw water violation, comprising 49.5% of total shutdown hours, had
been the main reason for shutdown at the partial WTPs. Electricity
supply interruptions and scheduled maintenance work accounted
for 22.5% and 12.3% of the total shutdown respectively. The
remaining shutdown hours were due to pipe bursts, pipe leaks,
mechanical and electrical breakdowns.
The most serious plant shutdown in 2005 occurred at the Gombak
WTP on 9 September 2005. Two tankers loaded with palm oil
collided at the 29th KM of the Kuala Lumpur-Karak Highway,
resulting in the palm oil spilling into the Gombak River and polluting
the raw water. The plant had to be shut down for a total of 97.75
Operations Centre at Klang Gates Dam
hours, disrupting water supply to consumers in the Gombak area.
In 2005, the total rainfall in the catchment area of the Sungai Langat
Dam was 2,523.80 mm. This was slightly higher than the 17-year
average (1988 to 2004) of 2,515.80 mm/year. In mid-February 2005,
the reservoir level of the dam had dropped drastically due to a low
rainfall of 1.40 mm recorded for the month of January, the lowest
level since 1988. However, due to prudent releases from the dam,
with the alternative of reducing release from the dam through raw
water transfer from the Semenyih Dam, and an exercise to reduce
plant water loss at the Sungai Langat WTP, the dam’s reservoir level
was able to reach its maximum level. The dam started overflowing
since 24 December 2005.
Cleaning up of Gombak River after palm oil spill on 9 September 2005
At the Klang Gates Dam, the total rainfall in the catchment area
The main plant activities undertaken at the 26 WTPs during the year
during the year under review was 2,564.90 mm, 8.4% higher than
under review included cleaning of the reservoirs at the Batang Kali,
the 18-year average (1987-2004) of 2,366.30 mm/year. The rainfall
Ampang Intake and Bukit Nanas WTPs; improving the earthing
recorded in the dam’s catchment area for the month of January was
systems for electromagnetic flowmeters at all WTPs; complete
9.60 mm, the lowest since 1988, resulting in a drastic drop in the
repainting of the Bernam River Headworks, Cheras Mile 11, Bukit
reservoir level by end-January 2005. A number of actions were
Tampoi and Salak Tinggi WTPs; and reactivating the wash water
taken such as: reducing release from the dam by reducing
recovery system at the Bukit Nanas WTP that effectively reduced
production at the Bukit Nanas WTP; limiting release from the dam to
the plant’s water losses from 3.99% to 2.45%.
the Bukit Nanas WTP only while the Wangsa Maju WTP extracted its
raw water solely from the Gombak River; and implementing a wash
DAM OPERATIONS
water recovery exercise at the Bukit Nanas WTP. Although the
PNSB continues to be responsible for the operation and
reservoir level went above the control level by 27 December 2005,
maintenance of three dams, namely the Sungai Langat, Klang Gates
it did not reach the maximum level as at 31 December 2005. To
and Tasik Subang Dams pursuant to a Supplemental Agreement to
address any potential critical storage drawdown in 2006, release
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 43
o p e r at i o n s r e v i e w : P N S B
wat e r t r e at m e n t a c t i v i t i e s
continues to be made only for the Bukit Nanas WTP. The Wangsa
The PNHB Group continues to explore water-related business
Maju WTP continues to extract raw water from the Gombak River.
opportunities in other parts of the world. The Kingdom of Saudi
Arabia is especially attractive and the Group is venturing into the
A total rainfall of 2,097.30 mm was recorded within the catchment
Kingdom in collaboration with a leading Malaysian wastewater
area of the Tasik Subang Dam, which was 9.73% lower than the
treatment company, WWE Holdings Bhd. We hope to be able to
nine-year average (1996-2004) of 2,530.41 mm/year. As at 31
secure some deals in the near future.
December 2005, the reservoir level was above the Operational Rule
Curve No.1.
Telibong and Telipok, Sabah
PNSB had entered into a turnkey sub-contract agreement with Imej
The Malaysian Meteorological Department has forecasted the
Warisan Sdn Bhd in 2003 for ‘Projek Pembinaan Loji/Kolam
annual rainfall for 2006 to be at the average level, so we do not
Takungan dan Paip Utama Telibong dan Telipok, Sabah’. Worth a
foresee any critical storage drawdown at the three dams. We will
contract sum of RM313.5 million, the project involves the planning,
continue to exercise prudence and good practices to ensure that
design, construction, supervision, testing and commissioning of a
the optimal amount of raw water is released to the WTPs. All three
new intake and raw water pumping station, water treatment plant,
dams are equipped with Dam Operations Control Curves to guide
off-river storage, three balancing/service reservoirs and 45 km of
the dam operators to meet demand from the WTPs for raw water
pipelines.
release whilst conserving dam water to prolong storage. Water
demand from the various WTPs is not expected to change in 2006.
The project, when completed, will supply water to the industrial
parks, tourist resorts and other residential developments around
the Tuaran area. Works commenced on 21 October 2003 and is
scheduled for completion by November 2007. As at end-2005, the
project is about 30% completed.
Chennai, India
PNHB and its joint venture partners were awarded the Chennai
Water Supply Augmentation Project 1 – Package III in November
2002 by the Chennai Metropolitan Water Supply and Sewerage
Board, Tamil Nadu, India. The scope of this RM234.0-million project
encompasses the supply and laying of 114 km of steel pipe,
Routine inspection at Sungai Langat Dam
construction of a break pressure tank and seven new bridges for
pipes to cross over rivers, and rehabilitation of seven existing
In line with PNSB’s emphasis on safety, two major visual safety
bridges. The project award includes providing operation and
inspections were conducted in 2005. The inspections, which
maintenance service for a five-year period after the completion of
covered all major structures of the dams and M&E equipment, were
works.
to detect and investigate any dam safety deficiencies and to
recommend appropriate corrective actions. PNSB’s Emergency
The construction phase of the project was completed in January
Response Plan as well as Safety and Health System have been
2005, and the operation and maintenance service contract
implemented at the three dams. As at 31 December 2005, the Loss
commenced on 19 January 2005 and will expire on 18 January 2010.
Time Injury recorded for the Sungai Langat Dam was 138,929 hours,
Klang Gates Dam was 62,086 hours and Tasik Subang Dam was
QUALITY ASSURANCE
61,385 hours.
A Central Laboratory and Process Improvement Section were
established under the Operation I Division during the year under
BUSINESS DEVELOPMENT
review. The Central Laboratory acts as a water quality ‘auditor’ for
With its operations firmly established in the State of Selangor and
the 28 WTPs, conducting weekly inspections of the quality of raw,
the Federal Territories of Kuala Lumpur and Putrajaya, the PNHB
settled and treated water, as well as assessing the capabilities of
Group has expanded its business into the State of Sabah, East
the laboratory and plant operators. The Process Improvement
Malaysia, and Chennai, India.
Section is responsible for undertaking studies, investigations or
plant trials to fine-tune processes for improved water quality and
44 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
water treatment, including optimisation of the filter. The Section is
Leave, Biz Alert and Training. The HRIS includes the application of
currently working on various short-term, long-term, continuous and
web-based technology that will provide access via intranet to allow
value-added projects to enhance operational efficiency of the WTPs.
real-time response to employee information, thereby increasing
departmental productivity. The HRIS is targeted to go ‘live’ during
A study conducted by the Process Improvement Section in 2005
the first half of 2006.
resulted in a number of improvements in terms of operational
efficiency. For example, filters at the Cheras Mile 11 and Bukit Nanas
An Electronic Document and Record Management System (EDRMS)
WTPs were observed to be backwashed every 24 hours. Upon
has been implemented for the administration of closed files from
reviewing the procedures, the filter run-time for most of the filters
the Strategic Resources Centre and other departments, while
was increased to 48 hours. Another example involved the
closed files from SYABAS are being uploaded. The EDRMS will allow
performance of the accelators at the Bukit Nanas WTP, which was
online retrieval of important records of the PNHB Group.
observed to have short cycle at an average 23 days due to floating
sludge. The sludge emitted a foul smell, creating a negative
Other IT projects in 2005 involved a personal computer replacement
impression of the Company’s level of service in addressing
exercise for a total of 57 computers that were more than five years
environmental pollution. Following several studies and a plant trial,
old and Microsoft Office basic training for plant superintendents.
the desludging cycle for the accelators was improved from 23 days
Measures have also been undertaken by the IT Department to
to about two months. Besides increasing operational efficiency, the
enhance personal as well as corporate IT security features.
above initiatives have also resulted in reduced operating cost.
CRISIS MANAGEMENT
The PNHB Group’s Crisis Management Committee’s response to a
number of events in 2005 has shown that it is able to manage and
control any untoward incidents that could occur during a crisis,
which may affect the PNHB Group’s corporate image and business
operations. In 2005, the Crisis Command Centre was activated five
times to handle the following events:
Safety Drill at Bukit Nanas WTP
On 1 September 2005, the procedures for monitoring the quality of
treated reservoir water were implemented at all WTPs. The
monitoring is to be done on a quarterly basis and as at 31 December
2005, two rounds of sampling have been conducted. The sampling
data has given indication on the water quality in the reservoirs with
regards to the Ministry of Health’s Drinking Water Quality Standards
for colour and turbidity. As such, the data obtained had provided
valuable information on the planning and execution of reservoir
Emergency Response Programme at SSP2 WTP
flushing and cleaning during the year under review.
Crisis Command Centre
INFORMATION TECHNOLOGY (IT)
No.
Date
Event
The year 2005 saw the PNHB Group advancing the use of IT through
1.
11 August 2005
Action plan on haze
the implementation of several major IT projects.
2.
9 September 2005
Oil spill at Gombak River
3.
19 September 2005
The first of these projects is an integrated Human Resource
Information System (HRIS) that will empower all Departments within
4.
28 September 2005
the organisation to automate and improve on existing work
processes. The modules that are ‘live’ are the Employee, Payroll,
Dry spell – shortfall of raw water to
WTPs in the Northern Region
Palm oil lorry accident at BRH WTP
catchment area
5.
5-12 December 2005
ASEAN Summit
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 45
o p e r at i o n s r e v i e w : P N S B
wat e r t r e at m e n t a c t i v i t i e s
The oil spill at Gombak River on 9 September 2005 was a major
PNSB’s commitment to safety and health is also reflected in
incident that tested both PNSB’s and SYABAS’ abilities in handling a
programmes such as the Site Safety Inspection and Safety
crisis situation involving consumers in the Gombak area. Whilst the
Compliance Audit that cover all WTPs and dams. These programmes
custody of the river is not under PNSB’s jurisdiction, the supply of
aim to ensure that the WTPs and dams comply with safety
treated water from the river is the Company’s responsibility. PNSB’s
regulations and adhere to the safety management system. In the
Management and operations staff worked in close collaboration
process, matters such as adequate signage as well as proper
with SYABAS, the relevant authorities, the media and consumer
storage of chemicals and usage of personal protective equipment at
groups, and succeeded in bringing the crisis under control within
the workplace are also reviewed annually .
four days with minimum shortcomings.
In 2005, all 28 WTPs were registered with the Department of
The episode has helped to test PNSB’s Emergency Response Plan
Occupational Safety and Health in compliance with the Factories
(ERP) system, as well as that of SYABAS, to the full by highlighting
and Machinery Act, 1967. During the year, 63.0% of machineries at
shortcomings that have since been rectified and improved. The
the WTPs have been issued Certificates of Fitness, with the rest to
incident had also prompted the State Authorities to review and
be completed by 2006.
improvise their respective ERPs. All parties are also now more
aware of their respective roles and responsibilities and better
HUMAN RESOURCE MANAGEMENT
prepared in handling such situations in future.
PNSB began the year under review with a total manpower strength
of 774 staff, comprising 66 Management staff, 202 executives and
OCCUPATIONAL SAFETY AND HEALTH
506 non-executives. To enable the Company to provide the service
As a responsible and caring employer, PNSB has been providing the
levels expected by the consumers, additional staff were recruited to
necessary safety and health mechanisms for employees who may
bring the total number to 919 as at 31 December 2005. This
be exposed to hazards while performing their duties. Although steps
comprised 86 staff at Management level, 219 executives and 614
taken by PNSB are in line with statutory requirements, the Company
non-executives.
relies on its own internal control measures in giving priority to
safety at the workplace. The Corporate Safety & Health Committee,
Employee Benefits
which was set up in 2004, continues to play a prominent role in
The quality and experience of its workforce is instrumental towards
developing policies and ensuring that these policies, approved by
PNSB maintaining its leading position in the water industry admist a
the Management, are adhered to.
challenging environment of increased regulatory framework,
handling raw water pollution issues and managing consumers’
All PNSB staff have to undergo annual safety and health training to
expectations of better and quality services in terms of clean and
instil in them a high level of safety awareness. Safety induction
uninterrupted supply of treated water.
training, mock drills as well as ERP training have been carried out at
all 28 WTPs and the three dams to train the staff to be responsive
It is therefore essential to retain those of calibre through an
and ready in the event of emergencies.
attractive employee benefits programme. At PNSB, this programme
includes comprehensive insurance coverage, housing and car loan
subsidies, as well as interest-free education, computer and personal
loans. Employees as well as their dependants enjoy medical
benefits that cover outpatient treatment, hospitalisation and
surgical expenses, and maternity expenses. There is also an
Employee Share Option Scheme, extended to the Executive
Directors and eligible staff, that will end in February 2007. In
addition, the salary scale of the non-executive staff were adjusted,
effective from 1 April 2005.
Training and Development
The specialised nature of PNSB’s operations requires that
employees are provided with adequate and appropriate skills
training and knowledge development. The investment in human
Safety Drill in progress
46 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
capital through training and development is therefore an ongoing
Sexual Harassment
process and in 2005, a total of 1,063 employees were trained at a
There have been no cases of sexual harassment reported in the
cost of RM242,192.00.
Group in 2005. The Group continues to ensure a safe and healthy
working environment for its employees irrespective of status, position
While employees regularly attend in-house training programmes
or gender. The Sexual Harassment Policy Handbook, which aims to
that are conducted for all levels, they are also sent for external
eradicate any form of sexual harassment at the workplace, has
training programmes to upgrade their core competencies and
instilled awareness amongst staff of the basic principles of the policy.
knowledge. Participation in external programmes help employees to
keep abreast with the latest developments in their respective fields
Protective Services
of expertise. Second line Management staff are being groomed to
The physical protection of the Group’s properties and other assets
be the future leaders in the organisation as part of the Company’s
is a matter of high priority and is undertaken by PNSB’s in-house
manpower succession plan.
protective services since the protective services personnel, being
directly employed by Puncak Niaga, would be more reliable than
In view of our leadership position in the water industry, our
Executive Chairman, YBhg Tan Sri
security staff working with an external party.
Rozali Ismail, as well as our
Executive Directors are often invited to share their knowledge,
Since the WTPs under the management of PNSB have been
experience and expertise at conferences and seminars on the
classified as protected areas and protected places under the
water industry. In 2005, these included the Second Annual Asia
Protected Areas and Protected Places Act 1957, PNHB have
Water Forum (18-19 July 2005), CIDB’s Seminar on the Malaysian
obtained an Auxiliary Police licence under the Royal Malaysian
Construction Sector (8 August 2005) and Forum on Water Issues in
Police on 31 December 2003. Out of a total protective services
Southeast Asia (16-17 August 2005).
personnel of 196, a total of 110 have been trained at the Police
Training Centre in Jalan Semarak, Kuala Lumpur as Auxiliary Police
The Company’s Quality Control Circles (QCC) programme continued
personnel. The eight (8) weeks training includes academic modules
to be active in 2005, with eight circles implementing their projects
and physical fitness training modules. The remaining 86 protective
during the period January-September 2005, showing an average
services personnel will be trained as Auxiliary Police personnel in
savings of RM31,902.38 per month (100.7 % of the targeted savings
2006 together with newly recruited protective services personnel.
of RM31,686.51 per month). With their implementation, these
In addition, all personnel involved in protective services have to
projects are now considered as part of the Standard Operating
undergo annual physical fitness tests, twice a year to ensure that
Procedures of the Operation I Division and as such, they are no
they are fit to carry out their duties and responsibilities.
longer being monitored by the QCC Committee.
In view of the encouraging results of the QCC programme, the
programme was resumed in August 2005, but under a new name,
the Innovative and Creative Circle (ICC) programme. New
committee members have been drawn from various departments,
such as Finance, WTPs Operation, Internal Audit, Central Laboratory
and Process Improvement. Training and awareness seminars on ICC
for the Top Management and all employees will be provided,
commencing January 2006.
Employee Unions
The Management of PNSB maintains cordial relationships with the
Non-Executive Union and the Executive Union, with emphasis
Auxiliary Police training at the Police Training Centre, Jalan Semarak
placed on cooperative efforts to achieve the Group’s goals and
PNSB’s protective services continued to undertake the regular
objectives.
security activities such as patrolling the Company’s premises,
investigating any untoward incidences that may affect the safety of
staff and the good name of the organisation, as well as coordinating
protocol and safety aspects of company events.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 47
o p e r at i o n s r e v i e w : P N S B
wat e r t r e at m e n t a c t i v i t i e s
In addition, there were a number of special projects undertaken
Staff Quarters
during the year under review. One was the gazetting of the Wangsa
The Quarters Committee organised a number of activities during the
Maju WTP as a prohibited area by the Government, an initiative
year under review. One of these was a ‘Super Camp’ for children of
which had begun towards end of 2004 and successfully concluded
Puncak Niaga’s staff who live in the SSP2 WTP staff quarters. A total
in September 2005. Another special project was an audit of the level
of 52 children aged six and above participated in the programme,
of protective services at SYABAS with the objective of identifying
which aimed to inculcate discipline, independence as well as a
and rectifying any areas of weakness. Almost 800 installations at
cooperative spirit amongst the children. There were also religious
SYABAS were audited over a six-month period.
lectures and activities during the camp.
Employee Welfare
To inculcate a spirit of togetherness and cooperation amongst
employees at all levels, various activities were organised by the
Sports and Welfare Club, Kelab Rekreasi dan Insani Puncak Niaga
Kuala Lumpur, and the Quarters Committee at the WTPs. In 2005,
competitions continued to be held for sports such as football,
volleyball, badminton and bowling, as well as recreational pursuits
such as fishing and karaoke. Highlights of the year were the Bowling
Tournament and Football Competition for the ‘Piala Tan Sri Rozali’.
Gotong-Royong at SSP2 WTP
Religious activities were also a regular feature of the year’s
Gotong-Royong are often arranged by the Quarters Committee to
employee welfare programme, organised by the Club’s ‘Biro
undertake various projects around the staff quarters. These projects
Agama’. Events included the ‘Majlis Bacaan Yassin dan Solat Hajat’,
help to bring the families together in a community activity to benefit
which was held on a monthly basis throughout 2005, and ‘Majlis
all residents. Such a gotong-royong was needed after a heavy storm
Ibadah Qurban’ at the Sungai Langat WTP. There was also a
at the SSP2 WTP on 8 April 2005, when the entry road and
presentation on ‘Islam Hadhari’ to the Muslim and Non-Muslim
surrounding area of the staff quarters were littered with fallen
Management personnel, organised with the help of Jabatan Agama
branches and other debris. With the cooperation of the staff, the
Islam Wilayah Persekutuan (JAKIM) and aimed at creating a better
entry road and surrounding area were cleared of the branches and
understanding of the concept.
debris and trees were trimmed of broken branches.
On a more festive note, the Quarters Committee held a ‘Merdeka
BBQ Night’ on 30 August 2005 to celebrate the nation’s
independence. Funded by cash collected from all staff, the wellattended event had a variety of activities such as dances and choral
singing by the children, husband-and-wife karaoke, colouring and
costume competitions as well as lucky draws. The evening ended at
midnight with a fireworks display.
Secretaries Nite at Sheraton Imperial Hotel
The Club’s women’s bureau, ‘Biro Hawa’, organised activities for
female staff members and the wives and children of employees. A
‘Secretaries Nite’ was held on 1 April 2005 and graced by YBhg Puan
Sri Faridah Idris, the wife of the Executive Chairman.
The Group’s employees also participated in the ‘Maal Hijrah 1426H’,
‘National Maulidur Rasul’, and the National Day parade to support
the Federal and State Governments in commemorating these
Merdeka BBQ Night at SSP2 WTP
special occasions.
48 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
o p e r at i o n s r e v i e w : s ya b a s
wat e r d i s t r i b u t i o n a c t i v i t i e s
The masterplan also includes putting in place a capital expenditure
programme of RM13 billion for upgrading and rehabilitation of the
entire water distribution system over the concession period. The
programme
of
works
of
RM997
million,
approved
for
implementation in years 2005 and 2006 covers various capital
expenditure works including the development and upgrading of the
existing water distribution system, reducing NRW as well as asset
management and replacement programme.
Water Distribution Services
SYABAS is responsible for distributing treated water to about 7.1
million consumers, and also factories and commercial buildings. It
has about 1.48 million consumer connections, 85% of whom are
domestic users. In addition, SYABAS is responsible for maintaining
15,400 km of water pipes, 800 water tanks and reservoirs and 350
pumping stations, amongst other facilities.
SYABAS purchases treated water from three concessionaires,
namely Puncak Niaga (M) Sdn Bhd, Syarikat Pengeluar Air Sungai
Selangor Sdn Bhd and Konsortium ABASS Sdn Bhd. The water is
Commencement of Operations Ceremony at SYABAS Headquarters
then distributed to consumers in the State of Selangor and the
Federal Territories of Kuala Lumpur and Putrajaya.
The PNHB Group achieved a significant milestone in its corporate
history on 15 December 2004 when its 70%-owned subsidiary,
Since it commenced operations on 1 January 2005, SYABAS has
SYABAS, signed a concession agreement with the Selangor State
taken various proactive steps to improve the level of its services to
Government and the Federal Government for the privatisation of
consumers. These include the following:
water supply services in the State of Selangor and the Federal
Territories of Kuala Lumpur and Putrajaya for a 30-year concession
•
period. The privatisation exercise involved SYABAS’ 100%
acquisition of Perbadanan Urus Air Selangor Berhad (PUAS),
covering all moveable assets as well as approximately 1,700 PUAS
To improve administrative efficiency at the District level, the
organisation has been restructured into ten Districts, each
headed by either a Senior Manager or General Manager.
•
Key activities were decentralised to the various District Offices.
employee from the Selangor State Government. The handover of
The Water Quality Unit, previously based at the Head Office was
functions and operations was officially undertaken on 1 January
extended to each District whereby each District was provided
2005.
with new air scouring equipment, a portable field test kit, a
computer and printer as well as a digital camera, and other
Well before the official handover, a masterplan had been drawn up
equipment. Mechanical and electrical (M&E) services have been
to improve SYABAS’ operational efficiency and financial position.
similarly decentralised from the workshop at Sungai Besi to the
The masterplan, which was put into immediate effect during the
year under review, focuses on the following:
District Level.
•
New techniques have been introduced to improve operational
productivity and efficiency. One of these, air scouring employed
•
To replace and upgrade the existing water distribution assets;
in the cleaning of water pipes. Robotic cleaning of water
•
To reduce Non-Revenue Water (NRW);
reservoir will be introduced in the near future. In the meantime,
•
To improve billing and collection and;
a special programme was implemented to manually clean all
•
To enhance the level of customer services and uplift the quality
of service in key activities.
water ponds within a six-month period.
•
The number of pump operators employed was increased from
88 to 216 during the year under review to ensure more effective
monitoring of the pumping stations so as to minimise
incidences of breakdown.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 49
o p e r at i o n s r e v i e w : s ya b a s
wat e r d i s t r i b u t i o n a c t i v i t i e s
•
Computerised technology has been introduced to increase
communities it serves. Like the ICU, YAKIN also sends out advance
operational efficiency. An e-Meter Monitoring System (e-MMS)
automated water disruption notices to the residential consumers. In
now enables the computerised management of water meters
2005, 38 notices were sent out by YAKIN.
and a Store Management System ensures that there is
adequate stock to meet operational requirements.
In April and July 2005, PUSPEL conducted two customer service
satisfaction surveys to gauge the consumers’ perceptions of its
Customer Service Centre
services, identify main issues and look into areas of improvement
for the future. On the average, while 10% of the consumers rated
PUSPEL’s services as ‘excellent’ in the areas of courtesy, accuracy of
information, speed of response and helpfulness, 67% rated its
services as ‘good’ and 20% as ‘fair’.
Non-Revenue Water (NRW) Reduction
Under the Concession Agreement, SYABAS is required to reduce the
NRW level of 42.78% as at 1 January 2005 to 15.0% on 31 December
2015. SYABAS’ masterplan has laid out a number of major
programmes to be implemented over the concession period to
achieve this target. These include:
•
Replacement of old pipes, the first phase of which will cover
critical areas in all Districts in the State of Selangor and the
PUSPEL officer attending to a consumer
SYABAS had been proactive in the establishment of a customer
Federal Territory of Kuala Lumpur;
•
Replacement of old meters, which tend to under-register water
service centre, Pusat Perkhidmatan Pelanggan (PUSPEL), in April
consumption, as well as those meters that are stuck to reduce
2004. In line with its “Customers’ First” Policy, PUSPEL is equipped
the commercial losses of NRW (the number to be replaced
with professional-grade telephony and a CRM database system that
enables the centre to liaise online and in real-time with the District
yearly is estimated to be 240,000);
•
Offices. PUSPEL is operational 24 hours, every day of the week to
connections with a single feed, to monitor flows into the zones
attend to consumers’ complaints and queries on water supplyrelated matters. In 2005, PUSPEL’s 60 call centre agents handled a
for systematic leakage control;
•
total of 461,360 calls and the total number of reported cases was
160,840.
Setting up District Metering Zones (DMZs) of about 500-1,500
Repair of faulty inlet flow control mechanisms at reservoirs to
minimise overflows and reduce NRW physical losses;
•
Implementation of a Supervisory Control And Data Acquisition
(SCADA) system for monitoring the water levels at the
PUSPEL’s Industrial Consumer Unit (ICU) provides assistance to the
reservoirs and pumping stations, which will ensure that system
consumers in the industrial and commercial sectors. Since its
pressures are maintained and water levels are monitored
inception, the ICU has followed up on 10,495 complaints from trade
consumers and during the year under review, 160 site visits were
made. The ICU also sends advanced automated water disruption
closely to detect any reservoir overflows;
•
Purchase of sophisticated electronic leak detection equipment
to detect non-visible leaks in the distribution system.
notices to the trade consumers to inform them of any scheduled or
unscheduled water disruptions. In 2005, a total of 164 such notices
These programmes are being implemented and are at various
were sent out by the ICU.
stages of progress.
Unit Informasi dan Kerjasama Pelanggan (YAKIN) focuses on
reaching out to the residential consumers through intermediaries
such as state assembly representatives, village heads and
community leaders. YAKIN has 232 ‘Ketua Taman/Kampung’ to help
it better understand the needs and problems of the various
50 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
•
Consistent monitoring and repair of the inlet control
mechanisms brought reservoir overflows under control, thus
reducing physical losses.
•
Enforcement actions were taken resulting in the legalisation of
1,760 illegal connections as at January 2006, with 30 cases still
pending.
•
Pressure-reducing valves were installed within the distribution
system. The control of pressure to acceptable levels helped to
reduce the incidents of pipe burst and leakage levels.
•
The improvement in meter reading and billing brought about a
reduction in commercial losses related to NRW. There has been
a marked improvement in the volume of metered consumption
since January 2005.
•
Meter replacement works, by which 206,289 meters have been
replaced as at February 2006, also contributed to the reduction
in commercial losses.
YBhg Tan Sri Rozali Ismail officiating the replacement of old pipes in critical
areas programme
Notwithstanding this, SYABAS has been successful in exceeding the
targets set under the Concession Agreement for the year 2005,
under which NRW was to be reduced to 39.03% during the
Laying of new pipes in the State of Selangor
measuring period of 1 to 31 October 2005, and to 37.78% by 31
December 2005. SYABAS achieved a reduction of the NRW level to
Billing and Recovery
36.92% during the performance period at 30 September 2005
Upon taking over the water distribution functions from PUAS,
(verified by the authorities) and to 37.3% as at 31 December 2005
SYABAS was faced with having to collect outstanding receivables
(subject to verification by the authorities).
amounting to RM363.0 million previously under PUAS as well as to
contain and reduce the receivables arising from its current monthly
A number of factors contributed to the NRW reduction
billings.
achievement:
Various policies were instituted and processes were enhanced to
•
•
The establishment of PUSPEL, which operates 24-hours has
improve debt management and collection practices. New Standard
enabled consumers to make reports of pipe burst and leak
Operating Procedures were put in place in regard to matters such
easily through the toll-free line 1-800-88-5252.
as disconnection of meters, issuance of letters of demand to
The faster response time by SYABAS, from 12-24 hours
defaulters and illegal reconnections. As a result, collection
previously to within an average of six hours currently, in
efficiency improved from 98.2% for the period ended 31 December
repairing pipe bursts. By mobilising a repair team to the site
2004 to 101.0% for the period ended 31 December 2005. Debtors
quickly, the affected pipeline could be isolated to minimise
turnover improved by 18 days from 133.4 days as at 31 December
water losses.
2004 to 115.2 days as at 31 December 2005. Efforts are being made
to reduce this further to 30 days.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 51
o p e r at i o n s r e v i e w : s ya b a s
wat e r d i s t r i b u t i o n a c t i v i t i e s
contract values, as well as an interim Limit of Authority for key
personnel. These measures have facilitated the award of contracts
and works to contractors, suppliers and consultants and ensured
that the Company’s capital expenditure, NRW, operations and
maintenance programmes are implemented accordingly.
As at end-2005, a total of 373 works/contracts (worth RM335.8
million) has been awarded for various programmes. Out of the total
number of 373 works/contracts, 85.0% (worth RM303.7 million)
were awarded to Bumiputra companies. This brings the
works/contracts awarded to Bumiputra companies to 90.4% of the
total contract value already awarded. This status is well in
compliance of SYABAS’ Concession Agreement, which stipulates
‘Drive-in’ payment counter at SYABAS Klang District Office
that at least 30% of the total value of works be awarded to
Bumiputra companies.
Billing is a critical aspect in the management of consumer accounts.
The total number of accounts has increased by 4.0% from 1,424,699
as at 1 January 2005 to 1,483,000 as at end-2005. These accounts
need to be billed promptly and accurately every month at the
correct addresses to enable timely payment by consumers. The
billing system in SYABAS has been decentralised to the ten District
Offices. For the year under review, the total amount of billing issued
was RM1.07 billion, an increase of 7.7% from RM993.87 million in
2004.
New methods and payment channels have been introduced during
the year under review to improve collection efficiency. One of these
was the implementation of the E-Biz System, developed by SYABAS’
Information and Communication Technology (ICT) Division, to
Signing Ceremony for SYABAS Facilities Agreement
facilitate and speed up the collection process. E-Biz is a web-based
To deliver efficient and high quality service to consumers, SYABAS
corporate bulk water bills monitoring and payment system, which
has to ensure that its contractors provide reliable and high quality
can be conveniently operated by corporate customers via SYABAS
work and services. To achieve this, SYABAS carried out the pre-
website, www.syabas.com.my. As at 31 December 2005, eight
qualification and registration of contractors by which competent
corporate customers have signed up as E-Biz users.
contractors were short-listed to undertake SYABAS projects. As at
end-2005, a total of 1,042 contractors, suppliers and consultants
SYABAS also appointed collecting agents to collect water supply
were registered with SYABAS. To provide Bumiputra companies the
bills on its behalf. These agents not only help to increase collection
opportunity to participate in SYABAS projects, local contractors,
but they also enhance the level of services to the consumers by
especially those under Class F, who were registered with the
providing a variety of facility channels for their convenience. These
Districts were given opportunities to undertake works within the
collection agents, totalling 20 as at end-2005, include a number of
respective Districts. In 2005, 61 contractors undertook projects
financial institutions as well as organisations such as POS Malaysia,
worth RM2.4 million in all the Districts.
Dewan Bandaraya Kuala Lumpur and Telekom Malaysia Berhad (TM).
In line with a requirement under SYABAS’ Concession Agreement to
Tender and Award of Contracts
assist and develop Bumiputra contractors, SYABAS initiated the
To increase transparency and enhance objectivity in the tender
‘Program Penyertaan Usahawan Bumiputra’ (PPUB) in 2005, the first
process and award of contracts, the Board of Directors of SYABAS
of similar programmes to be launched in the near future. Under
on 19 April 2005, approved the establishment and implementation
PPUB, Class F contractors selected to carry out SYABAS’ projects
of the Tender Committees with different approving limits based on
shall be trained by SYABAS engineers in areas such as project
52 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
management, report writing and site supervision. The performance
on-line bulk water transfer daily meter recording by water
of these contractors shall be assessed and graded regularly by
treatment plant operators; and the SYABAS netStorage facility to
SYABAS.
ensure timely updating of paid water bill information to consumer
accounts by collection agents participating in on-line collection data
Information and Communication Technology (ICT)
transfer.
During the year under review, several ICT initiatives were
implemented to meet the Company’s requirements. These
initiatives are categorised into ICT Infrastructure; Communication,
Collaboration and Resource Sharing; eBusiness and eService; and
Business Applications.
Under the ICT infrastructure initiative, several projects were
delivered. The Local Area Network (LAN) was expanded to
accommodate new locations and additional staff. In this respect, to
enable access to central resources and better performance, a laserbased communication technology was implemented at two off-site
offices at Wisma Goshen, Kuala Lumpur, and Kajang. A broadband
DSL solution and appliance-based virtual private network (VPN)
have also been installed at SYABAS’ 21 off-site offices to ensure
Old vehicles of PUAS, pre-privatisation
adequate connectivity with SYABAS’ Headquarters, better
connection availability, security and stability. Security has been
enhanced with the implementation of enterprise virus protection.
Billing and collection are at the core of SYABAS’ business activities.
Over the years, the database has grown in size and the application
system has exceeded its optimum performance limit. To overcome
the performance issue, the billing servers at all District Main Offices
were upgraded and the Oracle database replaced with version10g
Enterprise edition at a cost of RM1.0 million. During the year under
review, more than 800 desktops and notebooks and 400 printers
were purchased to equip the new workforce and to replace
obsolete units. In addition, Office productivity tools totalling RM4.5
million and e-mail facilities were provided to the workforce.
New fleet of vehicles under SYABAS, post-privatisation
Under the Communication, Collaboration and Resource Sharing
The Business Applications Initiative has seen the implementation of
initiative, eMESRA, the intranet portal for SYABAS’ workforce
several projects in 2005. Under the Spot Meter Reading and Bill
community, was enhanced while iSYABAS was introduced to
Serving System (SMRS), the old handheld computers was replaced
provide authorised SYABAS officers access to restricted resources.
with industrial Personal Digital Assistants (PDAs) at a cost of RM2.3
Both of these applications were developed internally by the ICT
million. The Developer’s Water Supply System Plan Submission
Division.
Approval application, eDPLAS, was implemented for its Phase I
while Phase II (Pumping and Reservoir System, Electrical System
Customers, business partners and the public are served
and Telemetery System Submission) has been completed. The
electronically through the eBusiness and eService initiative. The
PUSPEL Consumer Service Information System (iCONSUMER), an
SYABAS and PUAS websites have been consolidated into one,
application to maintain the industrial/commercial consumers and
www.syabas.com.my. This website forms the portal to all the
resident associations’ database, was also put in place.
applications implemented in this category. New applications
introduced were eBIZ, which provides corporate customers with on-
Other projects implemented during the year under review included
line bulk accounts bill presentment and payment; netSOURCE, an
BASIS, the Customer Information, Billing and Collection Application;
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 53
o p e r at i o n s r e v i e w : s ya b a s
wat e r d i s t r i b u t i o n a c t i v i t i e s
EVODEX eHR, eLeave and Payroll system to improve human
resource management activities; and iJOB, which enhances the
operation of SYABAS’ stores vide on-line stock control and order
forms.
The implementation of several other projects are in progress. Phase
I of the Water Quality Management System (WQMS) will enable
SYABAS to track water quality incidents reported by the public or
the Ministry of Health and the status of remedial actions
undertaken. The Geographical Intergrated System (GIS) Mapping on
the Water Supply Networks, Structures and Assets project is in
progress and the tender for the SCADA & Telemetry of Reservoirs
and Pumping System will be called soon.
Merdeka Day march pass
Human Resource Management
As a result of an internal organisational restructuring involving
Sexual Harassment
SYABAS Headquarters as well as all District Offices, a total of 672
The Board of Directors of SYABAS approved the Company’s Sexual
new employees of various categories were recruited during 2005.
Harassment Policy on 10 August 2005, which will provide the
The new recruitment was also to fill vacancies arising from
guidance on handling of any such cases that may be committed in
resignations or staff retirement. As at year-end, the total number of
the Company. A Sexual Harassment Committee has also been
staff was 2,426 against 1,754 on 1 January 2005.
formed and includes the Senior Management. No complaint or
report on sexual harassment has been received since the inception
To portray the Company’s new corporate identity as well as to
of the Committee.
increase visibility while performing their duties at sites, all field staff
of SYABAS were provided with new uniforms and identification tags.
Employee Welfare
These uniforms and tags were also provided to the contractors
SYABAS aims to involve all staff in various activities to improve
involved in SYABAS’ projects.
morale and motivation, which will translate into better services to
the consumers. Towards this end, events such as monthly
Training and Development
gatherings, monthly meetings with the Executive Chairman,
In line with the PNHB Group’s overall emphasis on adequate and
thanksgiving prayers and reading of the Yassin, breaking of fast and
appropriate skills training and knowledge development, a
celebration of Hari Raya Aidilfitri, are organised. In line with the
systematic training and career development programme for
PNHB Group’s practice, interest free educational loans of up to RM
SYABAS’ workforce was initiated in March 2005. In 2005, SYABAS
1,000.00 each were extended to staff who applied for the facility in
spent RM352,029.00 on training and development which covered
December 2005 to assist them in the preparation for their school-
induction and motivational training for newly recruited employees;
going children’s expenses when school re-opened on 3 January
on-the-job training in various areas such as operations and
2006.
maintenance, accounting and computer programming. High priority
was also given to participation in external training programmes. A
number of safety-oriented training sessions were organised during
the year under review, including the Company’s Emergency
Response Plan that was organised in December 2005 for all levels
of staff.
54 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
co r p o r at e s o c i a l
responsibilit y
The business of the PNHB Group revolves around the communities
We go the extra mile in providing our services to the community.
it serves. As such, the Group is constantly aware of the impact of its
During the year under review, we assisted the State Government of
corporate social responsibility initiatives towards its growth and
Negeri Sembilan for the period 19 August to 20 November 2005 by
sustainable development in the long term.
providing 46 static tanks, 3 filling stations and 5 water tankers and
making 647 trips to send 3,553.6 cubic metres of water to relief the
Our corporate mission covers active support and participation in
residents in Negeri Sembilan who were undergoing daily water
programmes that uplift the community’s living standards and value
rationing due to a severe water crisis in that state eventhough our
systems in line with the aspirations of Vision 2020. We are also
areas of responsibilities falls within the State of Selangor and the
committed towards addressing national and international concerns,
Federal Territories of Kuala Lumpur and Putrajaya.
pertaining to the protection, conservation and enhancement of the
natural environment. As such, we seek to fulfil our mission by
Reaching Out to Our Consumers
managing our business responsibly and sensitively, with the
Our subsidiary, SYABAS, has a direct link with our consumers
objective of making a difference in the lives of people around us.
through the distribution of treated water. We understand that our
consumers expect clean and reliable water supply and, as a
Providing Services to the Community
responsible corporate citizen, we would like them to know that we
are just as equally, if not more, concerned.
To foster a closer relationship with our consumers, a year-long
campaign, ‘Kempen Mesra Pengguna SYABAS’, was launched in
March 2005 by our Executive Chairman, YBhg Tan Sri Rozali Ismail.
The campaign involved a series of roadshows to office blocks and
shopping complexes in the urban and rural areas in Selangor and
the Klang Valley, at which consumers could make inquiries on any
water-related issues, register, check and pay water bills. Activities
were also organised during these roadshows, including colouring
competitions for primary school children, exhibitions, quizzes, lucky
draws as well as entertainment by popular artistes.
Providing aid to consumers during the ‘Water Supply Crisis’ programme in
Negeri Sembilan
‘Kempen Pengguna Prihatin SYABAS’ (SYABAS Most Caring
During the year under review, the PNHB Group continued to fulfil its
Customers Campaign) was launched in 2005 in tandem with
commitment of providing treated water to the communities it
‘Kempen Mesra Pengguna SYABAS’. It was aimed at encouraging
serves, particularly to those that have not had access to this basic
amenity due to various reasons.
One such community is the Orang Asli settlement at Pulau Indah. In
June 2005, DYMM the Sultan of Selangor, Sultan Sharafuddin Idris
Shah, turned on a tap at the settlement’s water distribution centre
in a symbolic ceremony to mark the provision of treated water to 39
homes in the village. The supply of water to the settlement was
made possible after SYABAS installed new water pipes at a cost of
RM90,000.
The villagers of Kampung Bukit Sungai Putih, Mukim Ampang, have
had problems obtaining clean treated water for about 20 years. In
2005, SYABAS allocated RM3.57 million to build and install a suction
tank, pump house, service reservoir, pumping equipment and
related works for the village. About 300 households comprising
Lucky Draw Winners of the ‘Kempen Pengguna Prihatin SYABAS’
1,000 people benefited from this project.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 55
co r p o r at e s o c i a l
responsibilit y
the consumers to send in their complaints to PUSPEL at 1-800-88-
Helping Those In Need
5252 or sms at 39222 type : PUSPEL<space><your complaints /
The less fortunate in society continue to be the focus of many of our
feedback> or fax at 03-2295 5168 about water-related problems in
community services programmes. Our main charity project in 2005
their areas such as pipe bursts, water thefts, low water pressure,
involved contributions to a number of organisations that were
etc so that SYABAS could improve on its level of services to the
assisting victims, both in Malaysia and abroad, of the catastrophic
consumers. To show our appreciation to the consumers, those who
tsunami disaster that occurred in December 2004. Financial
lodged water related complaints during a particular month became
contributions totalling about RM1.71 million, including about
eligible for a lucky draw for that month. With attractive prizes such
RM25,000 collected by staff of the PNHB Group amongst
as plasma television sets, home theatres, refrigerators and other
themselves, were donated to these organisations such as
electrical goods, the campaign drew favourable response from the
Perbadanan Setiausaha Kerajaan Negeri Selangor (RM200,000),
public.
Pembangunan Lembaga Industri Pembinaan Malaysia (RM100,000),
Force of Nature (RM1 million), Tabung Mangsa Tsunami Malaysia
The other campaign, 'Kempen Bulan Pemutihan dan Pendaftaran
(RM250,000) and the Government of India (Rp1,500,000 equivalent
Air’, was in line with SYABAS’ efforts to address illegal tapping of
to RM134,000).
water. The objective was to encourage an estimated 50,000 illegal
users of water in the State of Selangor and the Federal Territories of
Other notable donations made by the Group during the year were:
Kuala Lumpur and Putrajaya to register as legal water consumers.
•
RM100,000 to the Sultan of Selangor Cup
•
RM50,000 to the Kolej Tunku Kursiah Building Fund
Other than campaigns, we also go directly to the communities to
•
RM50,000 to Putera UMNO Malaysia
reach our consumers. SYABAS regularly holds dialogues with
•
RM30,000 to the Senior Citizens Association of Selangor and the
resident associations, during which residents are able to voice the
water-related problems faced by their respective communities.
Federal Territory
•
These dialogues present a good opportunity for SYABAS to advise
the residents about actions that have been taken or would be taken
to resolve such problems. In 2005, SYABAS held dialogues with 13
RM30,000 to Sekolah Kebangsaan Raja Muda for the school’s
jogathon
•
RM10,000 to the Shah Alam City Council for the construction of
a community hall
resident associations in the Klang Valley.
Besides monetary donations, contributions in kind, were also
In addition, Puncak Niaga entertains visits by interested groups to
extended including three (3) casket vehicles costing about
its water treatment plants as a means of educating the public on
RM90,000 each to Surau Kampung Bahagia Gedangsa, UMNO –
the processes involved in the supply of treated water. During the
Subang Division and UMNO – Kuala Langat Division.
year under review, there were 24 plant visits by various groups that
included school and university students, corporations and staff of
Protecting and Conserving the Environment
government departments as well as overseas visitors.
Visit to SSP2 WTP by delegation from Denmark
River Rescue Brigade No.17 at Bukit Tampoi WTP
56 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
Our commitment towards the protection and conservation of the
In December 2005, we also produced five different designs of
environment was reflected in many ways. One of these is our
bookmarks and two types of pocket calendars at a cost of
Factory Visit Programme, the objective of which is to create
RM230,000, which were then distributed to school children and
awareness amongst the Management and employees of factories of
water consumers in the Klang Valley. These items carried
the impact of their manufacturing activities on the environment,
environmental messages such as ‘Water : Our Source Of Life’;
particularly the water system. In 2005, staff of the PNHB Group
‘Children : Our Future Generation’ and ‘Working Together For A
visited the factories of Contact Latex Dippers, NEC Semiconductors
Better Tomorrow’ to create public awareness of Puncak Niaga and
(M) and Sime INAX in Batang Kali, Teluk Panglima Garang and Batang
SYABAS and the need to conserve water.
Berjuntai respectively, all of which are located in Selangor. Such
visits will continue to be part of the PNHB Group’s Environmental
Awareness Programme.
We believe that the young generation are the key to the future wellbeing of our environment and we endeavour to teach them about
the protection and conservation of the environment through our
educational programmes. One of these programmes is the River
Rescue Brigade that was initiated in 1998. It has remained a key
programme in which students are taken on visits to Puncak Niaga’s
water treatment plants and dams. In 2005, the programme covered
67 participating primary schools in the State of Selangor and the
Federal Territories of Kuala Lumpur and Putrajaya. The River Rescue
Brigade is complemented by our Educational Outreach Programme
(‘Turun ke Padang’) that was launched in 1999. During the year
Launch of the ‘Maliau Basin:Sabah’s Lost World’
under review, 15 primary schools located within our areas of
To further drive the message of conservation home, Puncak Niaga
operation were visited by the Senior Management of Puncak Niaga
contributed RM200,000 towards the publication of a book, ‘Maliau
and SYABAS, who gave talks on taking care of rivers, the
Basin: Sabah’s Lost World’. Authored by Tengku Zainal Adlin, Dr
environment as well as the roles played by Puncak Niaga and
Waidi Sinun and Hans P Hazebroek, this beautifully produced and
SYABAS in the water treatment and water distribution processes
captivating book portrays the uniqueness of the flora and fauna of
respectively.
the Maliau Basin Conservation Area, which has a natural history that
spans several million years. The Sabah State Government has
proposed to the United Nations that the area be declared a World
Heritage site.
Being A Part of Society
While playing our part as a responsible corporate citizen and
discharging our many responsibilities in this respect, we strive to be
an active member of society through our participation in state and
national events. The most significant of these in 2005 was the
Merdeka Day Parade that was held at Merdeka Square in Shah
Alam, Selangor, on 31 August. We also participated in the
Environmental Week Exhibition held at Kuala Kubu Baru, Selangor,
during the year under review and supported the Malay Mail Big Walk
2005 on 25 September 2005 by installing ten water taps at the
Promoting environmental awareness through bookmarks and pocket
calendars
event venue for the convenience of participants and visitors.
For more information on our community services programmes, the
public may also access our websites: www.puncakniaga.com.my
and www.syabas.com.my.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 57
co r p o r at e c a l e n da r o f e v e n t s
1
January 2005
YAB Dato’ Seri Dr Mohd Khir Toyo, Menteri Besar of Selangor officiated the
ceremony to mark the commencement of operations of SYABAS at SYABAS
Headquarters.
8
January 2005
Visit by students from Maktab Rendah Sains MARA, Melaka to Wangsa Maju
WTP.
1 January 2005
19
January 2005
YAB Dato’ Seri Dr Lim Keng Yaik, Minister of Energy, Water and
Communications witnessed the Signing Ceremony of the Financing Facilities
Agreement between SYABAS and a panel of financial institutions at Istana
Hotel, Kuala Lumpur.
22
January 2005
Kelab Rekreasi & Insani Puncak Niaga Kuala Lumpur organised a ‘Korban
Programme 1425H’ at the Sungai Langat WTP.
23
19 January 2005
JANUARY 2005
A ‘Korban Programme 1425H’ was organised by SYABAS at its
Headquarters.
26
JANUARY 2005
Plant visit to SSP2 WTP by the Chinese delegation.
27
JANUARY 2005
Educational Outreach Programme No. 48 at Sekolah Kebangsaan
Sungai Merab Luar Kajang, Selangor.
3
23 January 2005
FEBRUARY 2005
Technical visit by SYABAS Management to Perbadanan Bekalan Air (PBA) Pulau
Pinang.
10
FEBRUARY 2005
PNSB participated in the ‘Maal Hijrah 1426H’ celebration held at Putra World
Trade Centre.
21
FEBRUARY 2005
27 January 2005
SYABAS held a dialogue on water related issues with the Residents’
Association of Section 10, Petaling Jaya.
22
FEBRUARY 2005
Educational Outreach Programme No. 49 at Sekolah Kebangsaan Ulu
Semenyih, Selangor.
24
FEBRUARY 2005
SYABAS held a dialogue on water related issues with the residents of
Bukit Damasara.
10 February 2005
58 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
p u n c a k n i a g a & s ya b a s
26
FEBRUARY 2005
“Kempen Mesra Pengguna SYABAS” and “Bulan Pendaftaran Air” were
launched by YBhg Tan Sri Rozali Ismail, Executive Chairman of SYABAS
at Jaya Jusco Bukit Raja, Klang. A Prize Giving Ceremony for the lucky
draw winners of SYABAS’ Most Caring Customers was also held.
27
FEBRUARY 2005
SYABAS held an exhibition and set up a counter in conjunction with
the “Pangsapuri Ku Sayang” Mini Carnival in Section 4, Kota
Damansara.
26 February 2005
9
March 2005
SYABAS held a dialogue on water related issues with the Residents’
Association of Taman Serdang Jaya.
10
March 2005
Plant visit to SSP2 WTP by the Health Inspectors’ Contingent.
18 March 2005
16
March 2005
YAB Datuk Seri Mohd Najib Tun Abdul Razak, Deputy Prime Minister received
a contribution of RM25,408.05 from PNSB on behalf of the Tsunami victims at
the Defence Ministry Headquarters.
18
March 2005
Launch of “Kempen Bulan Pendaftaran Air dan Pembaikan Perkhidmatan
(Pemutihan) SYABAS” by YAB Dato’ Seri Dr Mohd Khir Toyo, Menteri Besar of
Selangor at Subang Parade, Selangor. A Prize Giving Ceremony for the lucky
draw winners of SYABAS’ Most Caring Customers was also held.
22 March 2005
22
March 2005
WTP Open Day at Bukit Nanas WTP.
23
March 2005
Plant visit to Cheras Mile 11 WTP by Ulu Langat Health Department.
24
March 2005
Educational Outreach Programme No. 50 at Sekolah Kebangsaan Sungai
Buaya, Rawang.
24 March 2005
26
march 2005
“Kempen Mesra Pengguna SYABAS” road show at Selayang Mall, Selayang,
Selangor.
27
march 2005
YB Dato’ Yap Pian Hon, Member of Parliament for Serdang constituency
officiated a “gotong-royong” at Bandar Kajang Utama, Kajang, jointly organised
by SYABAS and Pra-Perbadanan Pengurusan Citra dan Lembaga Perumahan &
Hartanah Selangor.
26 March 2005
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 59
co r p o r at e c a l e n da r o f e v e n t s
28
march 2005
Launch of the “Maliau Basin (Sabah’s Lost World)”, a publication sponsored by
PNSB to support environmental preservation in Sabah by the Second Finance
Minister, YB Tan Sri Nor Mohamed Yakcop.
29
march 2005
Signing Ceremony of the Sale and Purchase Agreement between SYABAS and
Telekom Malaysia for TMGIS – Geographical Information System – Digital
Basemap.
1
28 March 2005
april 2005
‘Secretaries Nite 2005’ was held at Sheraton Imperial Hotel, Kuala Lumpur
with YBhg Puan Sri Faridah Idris as the guest of honour.
2
april 2005
SYABAS held the “Kempen Pendaftaran Air dan Pembaikan Perkhidmatan” at
the Multi-Purpose Hall in Matang Pagar, Selangor.
8
APRIL 2005
13 April 2005
PNSB’s Baids Holders’ Meeting was held at PNSB Headquarters.
9
APRIL 2005
A talk on Islam Hadhari was held at PNSB Headquarters.
10
APRIL 2005
“Kempen Mesra Pengguna SYABAS” road show at the night market site in
Tanjung Karang, Selangor.
13
15 April 2005
APRIL 2005
An Investors Presentation was held at Shangri-La Hotel, Kuala Lumpur.
15
APRIL 2005
River Rescue Brigade No.16 officiated by the Director of Selangor’s Youth &
Sports, YBhg Tuan Haji Mansor Bin Mohd Lazim at Sungai Langat WTP.
16
APRIL 2005
“Kempen Mesra Pengguna SYABAS” road show at Kompleks PKNS Shah Alam.
19
16 April 2005
APRIL 2005
Educational Outreach Programme No. 51 at SRJK (T) Saraswathy, Sungai Buloh.
21
APRIL 2005
PNSB participated in the “Maulidur Rasul” celebration at Stadium Bukit Jalil,
Kuala Lumpur.
22
APRIL 2005
Plant visit to Sungai Batu WTP by Institut Kesihatan Umum.
21 April 2005
60 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
p u n c a k n i a g a & s ya b a s
23
APRIL 2005
YBhg Tan Sri Rozali Ismail officiated the “Kempen Pendaftaran Air” for
squatters at Kampung Kerinchi, Kuala Lumpur.
28
APRIL 2005
Media visit to SYABAS Customer Service Centre (PUSPEL) at SYABAS
Headquarters.
15 May 2005
30
APRIL 2005
“Kempen Mesra Pengguna SYABAS” road show at Jalan Suasa, Banting.
4
MAY 2005
Plant visit to Wangsa Maju WTP by Japanese School of Kuala Lumpur.
15
MAY 2005
YBhg Tan Sri Rozali Ismail launched the SYABAS Water Pipe Replacement
Programme In Most Critical Areas (Phase 1) for the State of Selangor and the
Federal Territories of Kuala Lumpur and Putrajaya.
18 May 2005
18
MAY 2005
Working visit to PNSB Headquarters and Bukit Nanas WTP by Institut Latihan
Kemahiran Asas Perindustrian Bangi.
26
MAY 2005
Educational Outreach Programme No. 52 at Sekolah Kebangsaan Puchong,
Batu 14, Puchong.
2 June 2005
28
MAY 2005
A PNSB Bowling Match with the Media was held at Cosmic Bowl, Kuala
Lumpur.
2
JUNE 2005
PNSB’s factory visit to Sime INAX in Batang Berjuntai, Selangor.
6
JUNE 2005
Plant visit to Wangsa Maju WTP by Japanese School of Kuala Lumpur.
6 June 2005
7
JUNE 2005
Plant visit to SSP2 WTP by Jamaah Islah Malaysia.
10
JUNE 2005
PNSB contributed RM87,320.87 to UMNO Kota Damansara through its “Majlis
Sumbangan Kereta Jenazah PNSB”.
21
JUNE 2005
A briefing on SYABAS was held for the Residents’ Association of Taman
Seputeh, Kuala Lumpur.
10 June 2005
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 61
co r p o r at e c a l e n da r o f e v e n t s
23
JUNE 2005
Prize Giving Ceremony to winners of the Didi Newsletter Issue:1/2005 Quiz
was held at Sekolah Jenis Kebangsaan (C) Nam Kheung, Cheras.
24
JUNE 2005
PNSB donated three casket vehicles to Surau Gedangsa, UMNO Kuala Langat
Division and UMNO Subang Division amounting to RM270,962.61.
28
28 June 2005
JUNE 2005
Puncak Niaga Holdings Berhad’s 8th Annual General Meeting held at Kuala
Lumpur Golf & Country Club.
3
JULY 2005
PNSB contributed RM50,000 to the Kolej Tunku Kursiah Charity Dinner at
Palace of the Golden Horses Hotel, Seri Kembangan, Selangor.
7
JULY 2005
River Rescue Brigade No.17 officiated by YB Dato’ Sri Haji Adenan Satem,
Minister of Natural Resources & Environment at Bukit Tampoi WTP, Dengkil.
8
3 July 2005
JULY 2005
Prize Giving Ceremony for the winners of KITA Crossword Puzzle 2004 Contest
at PNSB Headquarters.
9
JULY 2005
Kelab Rekreasi & Insani Puncak Niaga Kuala Lumpur organised the PNSB
Annual Bowling Tournament at the Sungai Wang Plaza’s Cosmic Bowl, Kuala
Lumpur.
11
7 July 2005
JULY 2005
Encik Matlasa Hitam launched the “PNHB Auxillary Police Training” at the Jalan
Semarak Police Task Force Training Centre.
12
JULY 2005
Educational Outreach Programme No. 56 at Sekolah Kebangsaan St. Teresa (1),
Kuala Lumpur.
14
JULY 2005
SYABAS organised a “Hari Bertemu Pelanggan” at the Selangor State
Secretariat Administrative level at Kompleks PKNS, Shah Alam.
17
8 July 2005
JULY 2005
PNSB organised a friendly game of bowling with the staff of the Deputy Prime
Minister’s Office at Putrajaya Alamanda.
19
JULY 2005
Educational Outreach Programme No. 57 at Sekolah Kebangsaan Sg. Pelek,
Sepang.
19 July 2005
62 A N N U A L R E P O R T 2 0 0 5
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p u n c a k n i a g a & s ya b a s
22
JULY 2005
Plant visit to SSP2 WTP by the Selangor Police Force.
2
AUGUST 2005
Plant visit to SSP2 WTP by Riau delegation.
3
AUGUST 2005
Educational Outreach Programme No. 58 at Sekolah Kebangsaan Kg Batu,
Kuala Lumpur.
2 August 2005
5
AUGUST 2005
Visit to Bukit Sentosa by SYABAS to resolve issues faced by the residents of
Bukit Sentosa.
5-7
AUGUST 2005
PNSB and SYABAS participated in the Kuala Selangor Agro Expo at the Kuala
Selangor UMNO building.
5-7 August 2005
9
AUGUST 2005
YBhg Tan Sri Rozali Ismail officiated the “Kempen Meningkatkan Kualiti Air
Minum SYABAS” for the State of Selangor and the Federal Territories of Kuala
Lumpur and Putrajaya and also launched the “Program Pencucian Kolam Air
Simpanan SYABAS”.
10
AUGUST 2005
Plant visit to SSP2 WTP by the delegates of Institut Tadbiran Awam Negara
(INTAN).
9 August 2005
13
AUGUST 2005
Plant visit to SSP2 WTP by Universiti Institut Teknologi MARA (UiTM).
15
AUGUST 2005
SYABAS held a dialogue on water related issues with the Residents’
Association of Sungai Penchala.
16
AUGUST 2005
Factory visit by PNSB to Contact Latex Dippers Sdn Bhd in Batang Kali,
Selangor.
10 August 2005
17
AUGUST 2005
SYABAS participated in the march pass held in conjunction with the launch of
the Merdeka Celebration Month and “Kempen Kibar Jalur Gemilang” at
Selangor State level.
18
AUGUST 2005
SYABAS held a dialogue on water related issues with the Residents’
Association of Taman Nanyang, Jinjang Utara.
13 August 2005
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 63
co r p o r at e c a l e n da r o f e v e n t s
19
AUGUST 2005
SYABAS provided water tankers during the ‘Water Supply Crisis’ programme in
Negeri Sembilan.
20
AUGUST 2005
Plant visit to SSP2 WTP by UiTM.
22
AUGUST 2005
20 August 2005
SYABAS held a dialogue on water related issues with the Residents’
Association of SS3, Petaling Jaya.
23
AUGUST 2005
Factory visit by PNSB to NEC Semiconductors (M) Sdn Bhd at Teluk Panglima
Garang, Selangor.
24
AUGUST 2005
Plant visit to Wangsa Maju WTP by Politeknik Sultan Salahuddin Abdul Aziz
Shah.
31 August 2005
27
AUGUST 2005
Plant visit to SSP2 WTP by the Civil Engineering Faculty of UiTM.
29
AUGUST 2005
A meeting on the new Distribution Pipes System Project was held by SYABAS
at the Selayang Utama Hall with the Selayang Municipal and the Residents’
Association.
31
AUGUST 2005
Puncak Niaga and SYABAS participated in the Selangor State’s 48th Merdeka
march pass celebration at Dataran Kemerdekaan Shah Alam.
5
7 September 2005
SEPTEMBER 2005
SYABAS organised a “Majlis Jasamu Dikenang” for retired staff at the Grand
Bluewave Hotel, Shah Alam.
7
SEPTEMBER 2005
As part of the National Service community programme, the 3rd batch of the
2005 National Service trainees participated in a cleaning exercise at the Bukit
Tampoi WTP.
8
8 September 2005
SEPTEMBER 2005
Prize Giving Ceremony for lucky draw winners for SYABAS’ Most Caring
Customers for the months of April, May and June 2005.
10
SEPTEMBER 2005
SYABAS participated in an exhibition and set up a Customer Services Counter
in conjunction with the “Program Kemerdekaan Sijangkang” at Sijangkang,
Selangor.
10 September 2005
64 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
p u n c a k n i a g a & s ya b a s
13
SEPTEMBER 2005
Working visit by YBhg Tan Sri Rozali Ismail to Gombak WTP following the palm
oil spillage at Karak Highway.
14
SEPTEMBER 2005
Plant visit to Wangsa Maju WTP by Tun Tan Cheng Lock College of Nursing,
Assunta Hospital.
13 September 2005
16
september 2005
SYABAS set up a Customer Services Counter in conjunction with “Majlis
Seranta dan Pameran Draf Rancangan Tempatan, Daerah Sabak Bernam” held
at Dewan Seri Bernam, Sabak Bernam.
17
september 2005
YBhg Tan Sri Rozali Ismail, SYABAS Executive Chairman officiated the launch
and briefing ceremony for the Water Meter Replacement Programme at
Jabatan Mekanikal dan Elektrikal, Sungai Besi.
14 September 2005
19
september 2005
Signing Ceremony for SYABAS Facilities Agreement in respect of the Bai
Bithaman Ajil Islamic Securities of up to RM3 billion and the Al Kafalah
Performance Bond Facility of up to RM50 million was held at the Putrajaya
Marriot Hotel.
22
september 2005
SYABAS launched its Integrated Mobile Customer Services Counter
Programme at the Dewan Serbaguna Dato’ Ahmad Razali, Jalan Kapar, Klang.
19 September 2005
28
september 2005
Plant visit by WWF’s Senior Education Officer to SSP2 WTP.
29
september 2005
Educational Outreach Programme No. 62 at Sekolah Rendah Jenis Kebangsaan
(C) Phooi Tee, Sabak Bernam, Selangor.
1
october 2005
SYABAS launched the ‘Water Quality Improvement Programme Phase II’ and
the establishment of 10 Water Quality Units at District level at Kampung
Baru, Kuala Lumpur.
29 September 2005
3
october 2005
SYABAS proceeded with the installation of suction tank, pump house, service
reservoir and pumping equipment and related works for Kampung Bukit Sg
Putih, Mukim Ampang. The event was launched at the Balai Raya, Kampung
Lembah Jaya Utara, Ampang.
7
october 2005
PNSB organised a “Majlis Berbuka Puasa” and “Solat Terawih” at Bernam River
Headworks WTP.
1 October 2005
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 65
co r p o r at e c a l e n da r o f e v e n t s
12
october 2005
SYABAS held a “Majlis Berbuka Puasa” with orphans at SYABAS District Office,
Kuala Lumpur.
13
october 2005
PNSB organised a “Majlis Berbuka Puasa” and “Solat Terawih” at the
Mezzanine Floor of PNSB Headquarters.
14
13 October 2005
october 2005
Kelab Rekreasi & Insani Puncak Niaga Kuala Lumpur organised a “Majlis
Berbuka Puasa” at Sungai Batu WTP.
18
october 2005
Visit by the Ministry of Urban Development and Water Supply of Sri Lanka to
SYABAS Headquarters.
19
october 2005
Delegation from the Ministry of Urban Development and Water Supply of Sri
Lanka visited SSP2 WTP.
20
19 October 2005
october 2005
Kelab Rekreasi & Insani Puncak Niaga Kuala Lumpur organised a “Majlis
Berbuka Puasa” and “Solat Terawih” at SSP2 WTP.
12
november 2005
Plant visit to SSP2 WTP by the Tutor-Training Division of the National Kidney
Foundation of Malaysia.
14
20 October 2005
november 2005
A briefing session was held for the Residents’ Association of Taman Seputeh
on the Pipe Replacement Programme at SYABAS Headquarters.
17
november 2005
Plant visit to SSP2 WTP by lecturers and coordinators of the Health,
Occupational and Environmental Unit of Department of Social and Preventive
Medicine, Faculty of Medicine, Universiti Malaya.
19
november 2005
Hari Raya celebration at SYABAS Headquarters.
23
19 November 2005
november 2005
Plant visit to SSP2 WTP by Denmark Embassy delegation.
26
november 2005
A Hari Raya Aidilfitri gathering for staff of SYABAS and Puncak Niaga was held
at SYABAS Headquarters.
23 November 2005
66 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
p u n c a k n i a g a & s ya b a s
28
november 2005
“Kempen Meningkatkan Kualiti Air Minum & Program Pencucian Kolam Sedut
dan Kolam Simpanan SYABAS” was officiated by YB Datin Paduka Chew Mei
Fun, Member of Parliament of Petaling Jaya Utara at Kolam Air Simpanan
Seaport, SS3, Petaling Jaya.
29
november 2005
PNHB’s Annual Report 2004 won the NACRA 2005 Industry Excellence Award
for Main Board Construction & Infrastructure Project Companies at Palace of
the Golden Horses Hotel, Seri Kembangan, Selangor.
26 November 2005
29-30
november 2005
PNSB participated in the 2nd National Utilities Summit 2005 at the Carlton
Conference Centre, Summit, USJ, Subang Jaya.
1
december 2005
YBhg Tan Sri Rozali Ismail, Executive Chairman of SYABAS officiated the
Handing Over Ceremony of a new fleet of SYABAS vehicles to SYABAS District
Offices at SYABAS Headquarters.
29 November 2005
6
december 2005
Visit by the Chinese delegation from the Fujian Provincial Health Bureau to
SYABAS Headquarters.
7
december 2005
A briefing on the proposed adjustments to the water tariff rates 2006 for the
Members of Parliament was held at Carcosa Sri Negara, Kuala Lumpur.
29-30 November 2005
10
december 2005
A ceremony to launch SYABAS Water Pipe Replacement Programme In Most
Critical Areas (Phase 1) was held at Section 1, Bangi, Jalan Kajang 3, Taman
Kajang Baru and Taman Berjaya Sabak Bernam.
15
december 2005
SYABAS held its “Hari Bertemu Pelanggan” for Kuala Langat District at Jalan
Rakyat, Banting.
24
7 December 2005
december 2005
SYABAS held a dialogue on water related issues with the Committee Members
of the Board of Administrators of Kampung Baru, Kuala Lumpur.
24 December 2005
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 67
N E W S PA P E R C L I P P I N G S
Water
WorldDaily
68 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
puncak niaga
Headlines
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .............
Puncak Niaga has allocated RM2 million for the Programme
on River Preservation that covers all 769 primary schools in
Selangor, Kuala Lumpur and Putrajaya by 2015
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 69
N E W S PA P E R C L I P P I N G S
Water
WorldDaily
70 A N N U A L R E P O R T 2 0 0 5
Puncak Niaga Holdings Berhad
s ya b a s
Headlines
.....................
Syabas begins
phase one to
replace mains
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 71
// I tried numerous means to get a
proper source of clean water supply,
but no one was willing to help;
until SYABAS stepped in.
//
For months, Mr N. Ramachandran tried in vain to find ways on how
to get supply of piped water legally. The water supply for his car
wash business located in Subang Jaya in a rented industrial lot was
not legally registered.
With the assistance of an officer of SYABAS, Mr N. Ramachandran‘s
business was registered as a water consumer account. The
friendly SYABAS officer also advised him on how to recycle and
conserve water in his business.
72
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
s tat e m e n t o n
co r p o r at e g ov e r n a n c e
The Board of Puncak Niaga is pleased to state that Puncak Niaga is in compliance with the Best Practices in Corporate Governance as set
out in Part 2 of the Malaysia Code of Corporate Governance (‘the Code’). We believe that the principles of good governance are integral to
Puncak Niaga’s growth and ability to promote the confidence of its stakeholders.
Since 2003, the Board has adopted a Board Charter, which provides guidance on how business is to be conducted in line with international
best practices and standards of good corporate governance. In 2004, the Board has also adopted a Corporate Disclosure Policy and
Procedure, which was formulated in line with the ‘Guide On Best Practices In Corporate Disclosure’ issued by the Task Force on Corporate
Disclosure Best Practices established by Bursa Malaysia Securities Berhad (‘BMSB’). From time to time, the Group continues to refine and
revamp its financial objectives, goals, policies and procedures, controls and risk management framework to meet the evolving corporate
environment.
The Board of Puncak Niaga is therefore pleased to report on how the Group has applied the principles of the Code and best practices of
corporate governance and the extent to which it has complied with the best practices as set out in the Code during the year 2005.
BOARD OF DIRECTORS
(a) THE BOARD
The Group is helmed by an effective and experienced Board, comprising individuals of calibre and credibility from a diverse blend of
professional backgrounds. With the adoption of the Board Charter, the Board members, whether acting in their individual capacities or
as a whole, share the common objective of ensuring that the Vision and Mission of the Company as set out on page 14 of this Annual
Report, are achieved.
Each Board member is fully aware of their fiduciary duties and responsibilities and the various legislations and regulations affecting their
conduct as Directors of the Company, and as such, take full responsibility for the performance of the Company and of the Group.
The role of the Executive Chairman is separate from that of the Managing Director. The Board Charter sets out the specific
responsibilities to be discharged by the Board members collectively and the individual roles expected from the Executive Chairman,
Managing Director, Executive Directors and Non-Executive Directors.
YB Tan Sri Dato’ Seri Dr Ting Chew Peh is the Company’s Senior Independent Non-Executive Director, to whom shareholders’ concerns
may be conveyed.
(b) BOARD COMPOSITION
During the year 2005, there were several changes to the Board’s composition:1.
2.
YBhg Dato’ Mat Hairi Ismail and Encik Abdul Majid Abdul Karim resigned from the Board of PNHB on 3 January 2005.
Madam Loong Chun Nee who was appointed to the Board of PNHB/PNSB on 3 January 2005 resigned as Executive Director, Finance
Division on 23 June 2005.
3.
Upon the recommendation of the Nomination Committee, Mr Tan Seng Lee was appointed as Executive Director, Finance Division
of PNHB/PNSB on 1 September 2005.
4.
Upon the recommendation of the Nomination Committee and in view of the full time duties and responsibilities to be discharged
at SYABAS, the Board’s composition at Group level was revamped on 1 October 2005 to ensure the Board’s continued effectiveness.
The following were the adjustments made to the Board’s composition:-
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 73
s tat e m e n t o n
co r p o r at e g ov e r n a n c e
(i)
Encik Ruslan Hassan, the Chief Executive Officer of SYABAS ceased as the Executive Vice Chairman of PNHB/PNSB and
Executive Director, Corporate Affairs Division of PNSB and was re-designated as a Non-Independent Non-Executive Director of
PNHB;
(ii) Ir Lee Miang Koi, the Chief Operating Officer of SYABAS ceased as Executive Director, Project and Business Development
Division of PNHB and was re-designated as a Non-Independent Non-Executive Director of PNHB; and
(iii) Encik Matlasa Hitam who was the Executive Director, Human Resources and Administration Division of PNSB was appointed
to the Board of PNHB and assumed the position of Managing Director of PNHB/PNSB.
The Board’s composition of nine (9) members, comprising four (4) Executive Directors, two (2) Non-Executive Directors and three
(3) Independent Non-Executive Directors is in compliance with the Listing Requirements (LR) of BMSB of one third of the Board to
comprise Independent Directors.
The composition of the Board brings to the Group a diverse wealth of skills, knowledge as well as a balanced mix of experience
and expertise to effectively discharge the Board’s responsibilities for competent stewardship of the Group. Together, the Board
spearheads the Group’s growth and future direction. The profile of the Board Members are set out on pages 22 to 27 of this Annual
Report.
(c) BOARD MEETINGS
In 2005, the Board met five (5) times at the Board Room on 26th Floor, Suite 2601-2606, Plaza See Hoy Chan, Jalan Raja Chulan, 50200
Kuala Lumpur. The Board Meetings were held as follows:Day
Date
Thursday
24 February 2005
Time
11.30 a.m.
Wednesday
20 April 2005
3.30 p.m.
Wednesday
25 May 2005
11.30 a.m.
Wednesday
17 August 2005
11.30 a.m.
Wednesday
23 November 2005
11.30 a.m.
The details of the respective Director’s attendance at the above Board Meetings are as follows:Name of Director
Designation
No. of Meetings attended
%
Tan Sri Rozali Ismail
Executive Chairman
5
100
Ruslan Hassan
Non-Independent Non-Executive Director
5
100
Ir Lee Miang Koi
Non-Independent Non-Executive Director
4
80
Tan Sri Dato’ Hari
Independent Non-Executive Director
4
80
Independent Non-Executive Director
5
100
Syed Danial Syed Ariffin
Executive Director, Operation I
4
80
Datuk Dr Rahman Ismail
Independent Non-Executive Director
4
80
Tan Seng Lee
Executive Director, Finance
1
100
Managing Director
1
100
Narayanan Govindasamy
Tan Sri Dato’ Seri
Dr Ting Chew Peh
(appointed on 1 September 2005)
Matlasa Hitam
(appointed on 1 October 2005)
74
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
Directors who resigned in 2005
Name of Director
Designation
No. of Meetings attended
%
Dato’ Mat Hairi Ismail
Executive Director, Finance
N/A
N/A
Independent Non-Executive Director
N/A
N/A
2
100
(resigned on 3 January 2005)
Abdul Majid Abdul Karim
(resigned on 3 January 2005)
Loong Chun Nee
Executive Director, Finance
(appointed on 3 January 2005 and
resigned on 23 June 2005)
Sufficient notice is given for all Board Meetings. In between Board Meetings, approvals on matters requiring the sanction of the Board
are sought by way of circular resolutions enclosing all relevant information to enable the Board to make informed decisions. All circular
resolutions approved by the Board will be tabled for notation at the next Board Meeting.
(d) SUPPLY OF INFORMATION AND ACCESS TO ADVICE
Each Board member is supplied with information on a timely basis to enable them to effectively discharge their duties and
responsibilities. Except under exceptional circumstances, Board members are given at least seven (7) days’ notice before any Board
Meeting is held and the Board Papers are circulated to the Board members at least two (2) working days prior to the date of the Meeting.
Where necessary, the Company’s personnel will be called upon by the Board during the Board Meetings to present and to clarify any
Board Papers presented. All Board members are expected to participate actively in Board deliberations and bring the benefit of their
particular knowledge, skills and abilities to the Board. Where a potential conflict of interest arises, it is a mandatory practice for the
Director concerned to declare his interest and abstain from the deliberation and decision-making process.
The Board has unrestricted and constant access to and interaction with the Senior Management. Each Board member also has full and
unlimited access to the advice and services of the Group Company Secretary. The Directors are regularly updated by the Group Company
Secretary on the latest developments in the legislations and regulatory framework affecting the Group. The Directors are familiar and aware
of their duties and responsibilities as well as the implementation of good corporate governance and compliance practices in the Group.
Where necessary, the Directors may, whether collectively as a Board or in their individual capacities, seek external and independent
professional advice from experts in furtherance of their duties at the Company’s expense.
(e) GROUP COMPANY SECRETARY
The Group Company Secretary ensures that Board procedures are both followed and reviewed regularly and has the responsibility in
law to ensure that each Board member is made aware of and provided with guidance as to their duties, responsibilities and powers.
She is also responsible for ensuring the Group’s compliance with all relevant statutory and regulatory requirements.
(f)
APPOINTMENT OF DIRECTORS
All Board appointments and removals thereof are approved by the Board upon the recommendation of the Nomination Committee. The
Board, through the Nomination Committee, has established a formal and transparent procedure in relation to the assessment of
candidates for Board appointments. The Board, through the Nomination Committee, also reviews the required mix of skills, experience
and other qualities of the Directors annually to ensure that the Board is functioning effectively and efficiently.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 75
s tat e m e n t o n
co r p o r at e g ov e r n a n c e
(g) RE-ELECTION OF DIRECTORS
Article 98 and Article 99 of the Company’s Articles of Association provide that one third of the Directors shall retire from office by
rotation at each Annual General Meeting and all Directors shall retire from office at least once every three (3) years but may offer
themselves for re-election.
Article 103 of the Company’s Articles of Association provides that any person appointed as an additional Director shall hold office only
until the next following ordinary General Meeting of the Company and shall be eligible for re-election.
Upon the recommendation of the Nomination Committee, the following Directors shall retire at the Ninth Annual General Meeting of the
Company and had offered themselves for re-election:(i)
Ir Lee Miang Koi, retiring pursuant to Article 98;
(ii)
YBhg Tan Sri Dato’ Hari Narayanan Govindasamy, retiring pursuant to Article 98;
(iii) Encik Matlasa Hitam, retiring pursuant to Article 103; and
(iv) Mr Tan Seng Lee, retiring pursuant to Article 103.
(h) EVALUATION OF BOARD EFFECTIVENESS
As in the previous years, the Board has, with the assistance of the Group Company Secretary, conducted an annual peer evaluation of
the Board’s effectiveness in the following key areas:(i)
Compliance;
(ii)
Board Meetings;
(iii) Board functions;
(iv) Board structure;
(v)
Financial and operational reporting;
(vi) Planning and objectives;
(vii) Risk assessment;
(viii) New business opportunities and projects;
(ix) Human resources;
(x)
76
Quality of Director’s observations and additional/comments.
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
(i)
BOARD COMMITTEES
The Board has delegated specific responsibilities to the Board Committees whose functions and authorities are spelt out in their
respective terms of reference. The Board Committees will observe the same rules of conduct and procedures as the Board, unless
otherwise determined by the Board. A summary of the various Board Committees at PNHB level and their composition are as follows:Name of Director
Audit
Remuneration
Nomination
Compliance,
ESOS Option
Committee
Committee
Committee
Internal Control
Committee
and Risk Policy
Committee
Tan Sri Rozali Ismail
Executive Chairman
Chairman
Ruslan Hassan
Non-Independent
### Past
Non-Executive Director
Member
Ir Lee Miang Koi
Non-Independent
### Past
Non-Executive Director
Member
Tan Sri Dato’ Hari
Narayanan Govindasamy
Independent Non-Executive Director
Member
Member
Member
Chairman
Member
Member
Member
Chairman
Chairman
Tan Sri Dato’ Seri Dr Ting Chew Peh
Independent Non-Executive Director
Chairman
Datuk Dr Rahman Ismail
Independent Non-Executive Director
Syed Danial Syed Arrifin
***Member
Executive Director, Operation I
Matlasa Hitam
Managing Director
*Member
***Member
(appointed on 1 October 2005)
Tan Seng Lee
Executive Director, Finance
(appointed on 1 September 2005)
Name of Past Director
**Member
**Member
**Member
Audit
Remuneration
Nomination
Compliance,
ESOS Option
Committee
Committee
Committee
Internal Control
Committee
and Risk Policy
Committee
Dato’ Mat Hairi Ismail
Executive Director, Finance
(resigned on 3 January 2005)
# Past
# Past
# Past
Member
Member
Member
Abdul Majid Abdul Karim
Independent Non-Executive Director
(resigned on 3 January 2005)
# Past
# Past
# Past
Chairman
Member
Member
Loong Chun Nee
Executive Director, Finance
## Past
## Past
##Past
(appointed on 3 January 2005 and
Member
Member
Member
resigned on 23 June 2005)
*
**
***
Appointed as a Member on 24 February 2005
Appointed as a Member on 1 September 2005
Appointed as a Member on 1 October 2005
#
##
###
Ceased to be a Member on 3 January 2005
Ceased to be a Member on 23 June 2005
Ceased to be a Member on 1 October 2005
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 77
s tat e m e n t o n
co r p o r at e g ov e r n a n c e
The Board Committees exercise transparency and full disclosure in their proceedings. Where applicable, issues are reported to the Board
with the appropriate recommendations by the Board Committees.
During the year 2005, in order to expedite the Board’s decision making process at the operating companies’ level, the Executive
Committee (‘EXCO’) comprising the Executive Directors were established at PNSB and SYABAS respectively. In addition to the regular
Board Meetings, the PNSB EXCO Meetings are held monthly whilst the SYABAS EXCO Meetings are held weekly to deliberate on matters
requiring the Board’s mandate in between the Board Meetings.
DIRECTORS’ REMUNERATION
(a) LEVEL AND MAKE UP OF REMUNERATION
The Company has a formal procedure to determine the remuneration of each Board member. In the case of the Executive Directors,
their remuneration are structured so as to link rewards to corporate and individual performance. Performance is measured against
profits and other targets set from the Company’s annual budget and business plans as well as achievement of planned returns paid
to shareholders. In the case of the Non-Executive Directors, their remuneration reflect their contributions and the time spent
attending to the Group’s affairs.
(b) PROCEDURE
The Remuneration Committee is responsible for recommending the remuneration packages of the Executive Directors to the Board. The
Board, as a whole, determines the remuneration of the Non-Executive Directors. Individual Directors shall abstain from discussing and
voting on their own remuneration at the Board Meetings.
(c) DISCLOSURE OF DIRECTORS’ REMUNERATION
The details of the remuneration of each Director of the Company during the financial year ended 31 December 2005 are as follows:Name of Director
Fees
Salaries
Bonuses
Leave Allowances
Passage
Employees
Total
Provident
Fund
(RM)
(RM)
(RM)
(RM)
(RM)
(RM)
Tan Sri Rozali Ismail
-
-
-
-
-
-
(RM)
-
Ruslan Hassan
-
-
-
-
-
-
-
Ir Lee Miang Koi
-
-
-
-
-
-
-
Tan Sri Dato’ Hari
-
-
-
45,000
128,000
-
173,000
-
-
-
45,000
134,000
-
179,000
-
-
-
45,000
37,000
-
82,000
Narayanan Govindasamy
Tan Sri Dato’ Seri
Dr Ting Chew Peh
Datuk Dr Rahman Ismail
(appointed on 3 January 2005)
Syed Danial Syed Ariffin
-
-
-
-
-
-
-
Tan Seng Lee
-
-
-
-
-
-
-
-
-
-
-
-
-
-
(appointed on 1 September 2005)
Matlasa Hitam
(appointed on 1 October 2005)
78
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
Name of Past Director
Fees
Salaries
Bonuses
Leave Allowances
Passage
Employees
Total
Provident
Fund
Dato’ Mat Hairi Ismail
(RM)
(RM)
(RM)
(RM)
(RM)
(RM)
(RM)
-
-
-
-
-
-
-
-
-
-
-
102,000
-
102,000
-
-
-
-
-
-
-
(resigned on 3 January 2005)
Abdul Majid Abdul Karim
(resigned on 3 January 2005)
Loong Chun Nee
(appointed on 3 January 2005 and
resigned on 23 June 2005)
The remuneration packages of the Directors of the Group for the financial year ended 31 December 2005 are categorised into the
appropriate components as follows:Executive Directors
(RM)
Non-Executive Directors
(RM)
Fees
-
-
Salaries
4,672,666
-
Bonuses
1,818,036
-
Benefits-in-kind
171,165
-
Allowance
1,670,097
509,000
Employees Provident Fund
1,065,306
-
Leave Passage
Total
49,018
135,000
9,446,288
644,000
Details of the Directors’ Remuneration at Company and Group level for the financial year ended 31 December 2005, in successive bands
of RM50,000 are tabulated as follows:Range of Remuneration per annum
Company Level
Group Level
No. of
No. of
No. of
Executive Directors
Non-Executive Directors
Directors
RM1 to RM50,000
-
-
6
RM50,001 to RM100,000
-
1
-
RM100,001 to RM150,000
-
1*
-
RM150,001 to RM200,000
-
2
1#
RM300,001 to RM350,000
-
-
1*
RM400,001 to RM450,000
-
-
1
RM500,001 to RM550,000
-
-
1#*
RM550,001 to RM600,000
-
-
1
RM750,001 to RM800,000
-
-
1
RM1,000,001 to RM1,050,000
-
-
1
RM1,200,001 to RM1,250,000
-
-
1
RM4,300,001 to RM4,350,000
-
-
1
*
Directors who resigned during the financial year ended 31 December 2005
#
Inclusive of Directors who were appointed during the financial year ended 31 December 2005
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 79
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(d) DIRECTORS’ SHARE OPTION
As at 31 December 2005, a total of 284,000 share options were exercised by the Executive Directors under the Company’s ESOS, the
details of which are set out on page 110 of this Annual Report.
(e) DIRECTORS’ TRAINING
Newly appointed Board members are given an induction aimed at providing them with the relevant background and information
pertaining to the Group at the earliest possible date.
The Company also organizes in-house training programmes, facilitated by industry experts for the Directors and Senior Management of
the Group. In addition, the Directors of the Group’s non-listed subsidiaries have attended the Corporate Directors’ Training Programme,
as recommended by the Companies Commission of Malaysia.
PNHB Directors who are newly appointed in 2005, have attended the Mandatory Accreditation Programme as required under the Listing
Requirements of Bursa Malaysia.
In 2005, the Directors have attended training programmes, seminars and conferences organised either by the Company or the
various accredited training providers on the water industry, director’s roles and responsibilities, effective management of company
meetings, understanding corporate financial reporting, financial matters and accounting standards, investor relations, bond markets
and corporate governance issues.
All PNHB Directors have complied with the Listing Requirements relating to Continuing Education Programme.
SHAREHOLDERS’ COMMUNICATION AND INVESTOR RELATIONS POLICY
The Board acknowledges the need for the Company’s shareholders and investors to be informed of all material business and corporate
developments concerning the Group in a timely manner. In addition to various announcements made during the year, the timely release of
the Groups’ consolidated financial results on a quarterly basis provides the shareholders and investors with an overview of the Group’s
financial and operational performance.
The Company maintains regular and effective communication with its shareholders and stakeholders through one-to-one or group dialogues,
participation in investor conferences organised by local and foreign institutional houses, attending to shareholders’ and investors’ e-mails
and phone calls enquiries, Company General Meetings and other Company events.
The Company’s Investor Relations Policy & Report is set out on pages 94 to 96 of this Annual Report.
ACCOUNTABILITY AND AUDIT
(a) FINANCIAL REPORTING
The Board is responsible for the quality and completeness of publicly disclosed financial reports. In presenting the annual financial
statements, quarterly reports and the annual report to the shareholders of the Company, the Board takes appropriate steps to present
a clear and balanced assessment of the Group’s position and prospects. This also applies to other price-sensitive public announcements
and reports to the regulatory authorities.
The Group’s financial statements and quarterly announcements, prepared using appropriate accounting policies, consistently and
supported by reasonable and prudent judgements and estimates, will be reviewed and deliberated by the Audit Committee in the
presence of the external auditors, internal auditors of the Company and the Senior Management of the Finance Division prior to
recommending them for adoption by the Board. The Audit Committee ensures that information to be disclosed are accurate, adequate
and in compliance with the various disclosure requirements imposed by the relevant authorities. The Board discusses and reviews the
recommendations proposed by the Audit Committee prior to its adoption. The Board also ensures the accurate and timely release to
BMSB of the Group’s quarterly and annual financial results. The half yearly results are also published in the newspapers for the benefit
of the investment community.
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(b) STATEMENT OF DIRECTORS’ RESPONSIBILITY FOR PREPARATION OF FINANCIAL STATEMENTS
The financial statements of the Group and Company have been drawn up in accordance with the applicable approved accounting
standards in Malaysia and the provisions of the Companies Act, 1965. The Directors take responsibility in ensuring that the financial
statements give a true and fair view of the financial position of the Group and of the Company as at 31 December 2005 and of the results
and the cash flows of the Group and of the Company for the financial year then ended.
In preparing the financial statements, the Directors have:•
selected suitable accounting policies and applied them consistently;
•
made judgements and estimates that are reasonable and prudent;
•
ensured that all applicable accounting standards have been followed; and
•
prepared financial statements on the going concern basis as the Directors have a reasonable expectation, having made
appropriate enquiries, that the Group and the Company have adequate resources to continue in operational existence for the
foreseeable future.
The Directors have the responsibility for ensuring that the Company keeps accounting records which discloses with reasonable
accuracy, the financial position of the Group and Company and which enables them to ensure that the financial statements comply with
the provisions of the Companies Act, 1965.
The Board has the overall responsibility to take all steps as are reasonably open to them to safeguard the assets of the Group to prevent
and detect frauds and other irregularities.
(c) RELATIONSHIP WITH EXTERNAL AUDITORS
The Board maintains a transparent and professional relationship with the Group’s external auditors. A report by the Audit Committee
together with its Terms of Reference is set out on pages 86 to 91 of this Annual Report.
(d) INTERNAL CONTROL
The Board acknowledges its overall responsibility for maintaining a sound system of internal control, which provides reasonable
assurance in ensuring the effectiveness and efficiency of the Group’s operations and to safeguard its assets and interests in compliance
with the relevant laws and regulations as well as the internal financial administration procedures and guidelines.
The Group’s Statement on Internal Control is set out on pages 84 to 85 of this Annual Report.
OTHER COMPLIANCE INFORMATION
(a) SHARE BUY BACKS
During the financial year ended 31 December 2005, the Company bought back a total of 5,808,800 of its ordinary shares of RM1.00 each
(‘Puncak Shares’) which are listed and quoted on the Main Board of BMSB.
The details of the Puncak Shares bought back by the Company during the financial year ended 31 December 2005 are as follows:Month
August
No. Of Shares
Purchase Price Per Share (RM)
Purchased & Retained
Lowest
Highest
Average
Total
As Treasury Shares
Price
Price
Price
Consideration (RM)
6,934,185.80
2,571,000
2.60
2.70
2.6971
September
300,000
2.73
2.79
2.7626
828,776.26
November
2,297,200
2.45
2.50
2.4910
5,722,378.09
December
640,600
2.43
2.49
2.4538
1,571,895.78
5,808,800
2.43
2.79
2.5921
15,057,235.93
TOTAL
Puncak Niaga Holdings Berhad
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During the financial year ended 31 December 2005, all 5,808,800 Puncak Shares bought back by the Company have been retained as
treasury shares and none of these treasury shares have been resold or cancelled.
(b) OPTIONS, WARRANTS OR CONVERTIBLE SECURITIES
During the financial year ended 31 December 2005, a total of 1,745,000 share options had been exercised, whilst a registered warrant
holder of 1,500,000 units had elected to convert the warrants into 1,500,000 new ordinary shares of RM1.00 each of the Company at a
warrant conversion price of RM2.62 each pursuant to the subscription right set out in the Deed Poll and the Supplement Deed Poll dated
5 September 2001 and 25 September 2001 respectively.
(c) AMERICAN DEPOSITORY RECEIPT (ADR) / GLOBAL DEPOSITORY RECEIPT (GDR)
The Company does not sponsor any ADR or GDR programme.
(d) SANCTIONS AND/OR PENALTIES
The Company and its subsidiaries, Directors and Management have not been imposed with any sanctions and/or penalties by the
relevant regulatory bodies during the financial year ended 31 December 2005.
(e) NON-AUDIT FEES
During the financial year ended 31 December 2005, the Group paid the following non-audit fees to the external auditors:-
(f)
(i)
Tax advisory and compliance work – RM171,855.00
(ii)
Other non-audit related service – RM545,000.00
VARIATIONS IN RESULTS
The Company’s/Group’s audited results for the financial year ended 31 December 2005 did not vary from the unaudited results which
was announced to BMSB on 24 February 2006.
(g) PROFIT GUARANTEE
The Company does not provide profit guarantee to any parties.
(h) REVALUATION POLICY ON LANDED PROPERTIES
The Group does not adopt a policy of regular revaluation of its properties. Details of the Group’s properties are disclosed in page 102 of
this Annual Report.
(i)
RECURRENT RELATED PARTY TRANSACTIONS
The Company did not enter into any recurrent related party transaction which requires the shareholders’ mandate during the financial
year ended 31 December 2005.
(j)
MATERIAL CONTRACTS INVOLVING DIRECTORS AND SUBSTANTIAL SHAREHOLDERS
Material contracts entered into by the Group, which involve the interests of Directors and major shareholders of the Company
and its subsidiary companies and material contracts which are still subsisting at the end of the financial year ended
31 December 2005, are as follows:-
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ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
Date
Nature of Contract
Parties
Consideration/
Mode of Satisfaction
Relationship with Director/
Substantial Shareholder
25 September
2003
Agreement For The Sale
And Purchase Of Shares
In Syarikat Bekalan Air
Selangor Sdn Bhd
(SYABAS)
YBhg Tan Sri Rozali
Ismail (TSRI), YBhg
Dato’ Mat Hairi Ismail
(MHI), Central Plus (M)
Sdn Bhd (CP) and
Puncak Niaga Holdings
Berhad (PNHB)
PNHB to acquire 70% equity
interest in SYABAS for a total
purchase price of RM38,009,840
upon SYABAS executing the
Concession Agreement for the
privatisation of the water
supply services in the State of
Selangor, Federal Territories of
Kuala Lumpur and Putrajaya
TSRI is the Executive Chairman
and substantial shareholder of
PNHB through his 50% equity
interests in CP and CL. MHI is a
former Executive Director of
PNHB and the younger brother
of TSRI
31 March 2004
Supplemental
Agreement For The Sale
And Purchase Of Shares
In SYABAS
TSRI, MHI, CP and
PNHB
Not Applicable
TSRI is the Executive Chairman
and substantial shareholder of
PNHB through his 50% equity
interests in CP and CL. MHI is a
former Executive Director of
PNHB and the younger brother
of TSRI
22 April 2004
Supplemental Agreement
To The Support Loan
Agreement dated 4 April
1998 for The Kuala
Lumpur Water Supply
Augmentation Works
The Government Of
Malaysia and Puncak
Niaga (M) Sdn Bhd
(PNSB)
Not Applicable
PNSB is a wholly-owned
subsidiary of PNHB
27 September
2004
2nd Supplemental
Agreement For The Sale
And Purchase Of Shares
In SYABAS
TSR, MHI, CP and
PNHB
Not Applicable
TSRI is the Executive Chairman
and substantial shareholder of
PNHB through his 50% equity
interests in CP and CL. MHI is a
former Executive Director of
PNHB and the younger brother
of TSRI
15 December
2004
Concession Agreement
SYABAS, the State
Government of
Selangor Darul Ehsan
and the Federal
Government
Not Applicable
TSRI is a substantial shareholder
of PNHB through his 50% equity
interests in CP and CL. He is also
a substantial shareholder of
SYABAS through his shareholding
in PNHB which in turn, holds 70%
equity interest in SYABAS
31 December
2004
Shareholders’
Agreement
PNHB, KDEB and
SYABAS
Not Applicable
TSRI is a substantial shareholder
of PNHB through his 50% equity
interests in CP and CL. He is also
a substantial shareholder of
SYABAS through his shareholding
in PNHB which in turn, holds 70%
equity interest in SYABAS
STATEMENT OF GOING CONCERN
Upon making due and reasonable enquiry into the affairs of the Group, the Board firmly believes that the Group shall continue to operate
as a going concern business in the foreseeable future.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 83
s tat e m e n t o n
i n t e r n a l co n t r o l
INTRODUCTION
INTERNAL CONTROL SYSTEM
The Malaysian Code on Corporate Governance requires listed
The key elements of the Group’s internal control system and
companies to maintain a sound system of internal control to
assurance processes, inter alia, encompass the following:-
safeguard shareholders’ investments and the Group’s assets. The
•
All major decisions require the final approval of the respective
Listing Requirements of Bursa Malaysia Securities Berhad requires
Boards within the Group (PNHB / PNSB / SYABAS) and are only
Directors of listed companies to include a statement in their annual
made after appropriate in-depth analysis. The respective Boards
reports on the state of their internal controls.
receive regular and comprehensive information covering all
Divisions / Departments / Districts in the respective companies
RESPONSIBILITY
within the Group.
The Boards of the PNHB Group are responsible for maintaining
sound systems of internal control and for reviewing their adequacy
•
All Divisions and Departments of PNSB have clearly
and integrity so as to safeguard the shareholders’ investments and
documented Procedures Manuals whilst SYABAS has Standard
the Group’s assets. The Board and Management have implemented
Operating Procedures incorporating control procedures and the
a control system designed to identify and manage risks facing the
scopes of responsibilities and authorities. The Procedures
Group in pursuit of its business objectives. This internal control
Manuals / Standard Operating Procedures are updated regularly
system, by its nature, can only provide reasonable and not absolute
to incorporate all elements necessitated by changes in the
assurance against material misstatement or loss.
legislation, industry best practices and business dynamics.
The Group has in place ongoing processes for identifying,
•
The Internal Audit Department of PNSB, independently reviews
evaluating, monitoring and managing significant risks faced by the
the control processes implemented by the Management from
Group during the year. The Management is responsible for the
time to time and periodically reports on its findings and
identification and evaluation of significant risks applicable to their
recommendations to the Audit Committee of PNHB. The duties
respective areas of business and to formulate suitable internal
and responsibilities of the Audit Committee are detailed in the
controls. This process is reviewed by the Board of PNHB via a
Terms of Reference of the Audit Committee. The Audit
specific Board Committee, namely the Compliance, Internal Control
Committee, by consideration of both Internal and External Audit
and Risk Policy Committee, which dedicates its time at periodic
Reports, is able to gauge the effectiveness and adequacy of the
intervals throughout the year for discussion on this matter.
internal control system, for presentation of its findings to the
Board. The Internal Audit Department of SYABAS extends a copy
RISK MANAGEMENT FRAMEWORK
of its Internal Audit Reports to the Executive Chairman and
Risk Management is firmly embedded in the Group’s management
summarised Status Reports on its activities are regularly
system and is every employee’s responsibility. In October 2001, the
submitted to the Management of SYABAS.
Board of PNHB formally approved a systematic risk management
structure and process for the Group. Since then, the structure and
•
The Compliance, Internal Control and Risk Policy Committee,
process have been fully implemented by the Management and
which is chaired by Yang Berhormat Tan Sri Dato’ Seri Dr Ting
employees of the PNHB Group. The Group’s risk management
Chew Peh, an Independent Non-Executive Director was
framework is explained in detail in the Risk Management Policy &
established in October 2001. This Committee closely monitors
Report as set out on pages 92 to 93 of the Annual Report.
the Risk Management process within the Group and the extent
of compliance with the Statement on Internal Control
requirements.
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ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
•
The Tender and Contracts Committee of PNSB and the Tender
Guidance for Directors of Public Listed Companies
Committees of SYABAS ensure transparency and competitive
Since the issuance of the “Statement on Internal Control: Guidance
pricing in the award of contracts within the Group.
for Directors of Public Listed Companies” (‘Guidance’) in December
2000, the Group has monitored its level of readiness with the
•
A detailed budgeting process has been established for PNSB
Guidance. The Group aims to not just achieve full compliance, but
and SYABAS requiring all Divisions / Departments / Districts to
also to improve on the Group’s processes by implementing best
prepare their respective budgets annually. These budgets are
business practices in line with international best practice standards.
then reviewed and approved by the respective Boards prior to
Throughout the year 2005, the Compliance, Internal Control and
actual implementation each year. The monitoring of actual
Risk Policy Committee has closely monitored the Group’s level of
performance versus budget, with major variances being
readiness with the Guidance.
followed up, is done on a monthly basis and management action
is taken to tighten or to rectify any shortcomings, where
This Statement on Internal Control has been prepared in
necessary.
accordance with the Guidance and has been approved by the
Board of PNHB and reviewed by the external auditors.
•
The Limits of Authority for PNSB was approved by the Board for
implementation in April 2003 and distributed to all Divisions and
Departments within the Group in May 2003. SYABAS has its own
For and on behalf of the Board of Puncak Niaga Holdings
Limits of Authority which was approved by Board and
Berhad.
implemented in April 2005.
Tan Sri Dato’ Seri Dr Ting Chew Peh
Chairman
Compliance, Internal Control and Risk Policy Committee
20 April 2006
Puncak Niaga Holdings Berhad
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AU D I T CO M M I T T E E R E P O R T
The Board of Directors of Puncak Niaga Holdings Berhad (“PNHB”) is pleased to present the report of the Audit Committee for the financial
year 2005.
1.
MEMBERSHIPS AND MEETINGS
The Audit Committee comprises the following members and details of attendance of each member at Audit Committee Meeting held
during the financial year 2005 are as follows:
Composition of Committee
No. of
No. of
Percentage
Meetings Held
Meetings Attended
(%)
5
5
100%
5
4
80%
5
4
80%
1
1
100%
3
3
100%
Yang Berhormat Tan Sri Dato’ Seri Dr Ting Chew Peh (Note 1)
Chairman/Independent Non-Executive Director
Yang Berbahagia Tan Sri Dato’ Hari Narayanan Govindasamy
Member/Independent Non-Executive Director
Yang Berhormat Datuk Dr Rahman Ismail (Note 2)
Member/Independent Non-Executive Director
Mr Tan Seng Lee (Note 3)
Member/Executive Director - Finance
Madam Loong Chun Nee (Note 4)
Member/Executive Director - Finance
Notes:
1. Appointed as the Chairman of the Audit Committee on 3 January 2005
2. Appointed as a Member of the Audit Committee on 3 January 2005
3. Appointed as a Member of the Audit Committee on 1 September 2005
4. Resigned as a Member of the Audit Committee on 23 June 2005
The General Manager (Internal Audit), Senior General Manager (Finance & Accounts) and other members of Senior Management
attended these meetings upon the invitation by the Chairman of the Audit Committee. The Group’s external auditors were also invited
to attend all these meetings. The Company Secretary, Madam Tan Bee Lian is the Secretary to the Audit Committee.
2.
SUMMARY OF ACTIVITIES
During the financial year 2005, the Audit Committee carried out its duties as set out in the terms of reference. The main activities carried
out by the Audit Committee during the financial year included the following:
Financial Results
•
Reviewed the quarterly and year-to-date unaudited financial results of the Group before tabling to the Board for consideration and approval.
•
Reviewed the reports and the audited financial statements of the Company and of the Group together with the external auditors
prior to tabling to the Board for approval.
External Audit
•
Reviewed the external auditors’ scope of work and audit plan for the year and made recommendation to the Board on their
appointment and remuneration.
•
Reviewed and discussed external auditors’ audit report and areas of concern highlighted in the management letter, including
management’s response to the concerns raised by the external auditors.
•
Discussed on significant accounting and auditing issues, impact of new or proposed changes in accounting standards and
regulatory requirements.
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ANNUAL REPORT 2005
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Internal Audit
•
Reviewed the Internal Audit plan, programmes of resources requirements for the year and assessed the performance of the
Internal Audit Department.
•
Reviewed the Internal Audit reports which highlighted the audit issues, recommendation and the Management responses and
directed action to be taken by the Management to rectify and improve the system of Internal control.
•
Monitored the implementation of programmes recommended by the Internal Audit Department arising from its audits in order to
obtain assurances that all key risks and control concerns have been fully addresses.
Related Party Transaction
Reviewed the related party transactions entered into by the Company and the Group.
Employees’ Share Option Scheme (ESOS)
Verified the allocation of options pursuant to the Employees’ Share Option Scheme of the Company and found to be in compliance with
the criteria referred to in the ESOS Bye-Laws.
The ESOS Bye-Laws do not provide any options for the Non-Executive Directors and therefore, none were allocated to the NED.
3.
INTERNAL AUDIT FUNCTION
The Group has an established Internal Audit Department which assists the Audit Committee in the discharge of its duties and
responsibilities. The Internal Audit Department provides an independent assurance on risk management and internal controls. The audit
focuses on regular and systematic review of the internal control and management information systems, including the system for
compliance with applicable laws, regulations, rules, directives and guidelines.
The annual audit plan of the Internal Audit Department which was developed on risk analysis approach was approved by the Audit
Committee at the last Audit Committee Meeting of the preceding financial year. The scope of the Internal Audit Department’s function
covered the audit of adequacy of risk management, operational controls, compliance with established procedures, guidelines and
statutory requirements and also the various computer application system and network of the Company and of the Group.
The Internal Audit Department had conducted the evaluation of the system of internal control that encompassed the Group’s
governance, operations and information systems. The Internal Audit reports, which highlighted the internal controls weaknesses, were
deliberated by the Audit Committee and the recommendations were duly acted upon by the Management.
In 2005, the Internal Audit Department undertook more than 50 audit assignments covering the 28 Water Treatment Plants, high-risk
areas identified by the Risk Management Scorecard Working Group and also areas of concern highlighted by Senior Management. In
addition, the Internal Audit Department conducted more than 10 adhoc assignments requested by the Senior Management.
Special emphasis was given to Plant Audit in Financial Year 2005, as PNSB had just taken over the operation and maintenance of the 26
WTPs from the Contractor effective 1st January 2005. The main audit objectives were to determine compliance with PCCA and CCOA
and other legal requirements, to monitor and detect shortcomings and abnormalities in WTP operation and to assess the level of
maintenance of WTP facilities. The audit scope included the water treatment process, mechanical and electrical equipment, nonmechanical and electrical facilities and WTPs’ compliance with safety requirements.
Other examples of key areas audited by the Internal Audit Department during the Financial Year 2005 were the Review of Meter Reading
– Discrepancies between Billing vs Production; Risk of Incorrect and Bad Press Coverage; Risk of Breach of Covenant; IT Audit of Sharing
Folders – Confidentiality of Information; Audit on Industrial Accounts With Minimum Charges of RM30 Per Month; Review on Non-delivery
of Pipes Under Pipe Replacement Programme; Review of Alleged Malpractice, etc.
Puncak Niaga Holdings Berhad
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AU D I T CO M M I T T E E R E P O R T
4.
TERMS OF REFERENCE
A.
Composition
The Board shall elect an Audit Committee from amongst themselves (pursuant to a resolution of the Board of Directors), comprising
of at least three (3) Directors where the majority of them should not be:
(i)
(ii)
Executive Directors of the Company or any related corporation;
A spouse, parent, brother, sister, son or adopted son, daughter or adopted daughter of an Executive Director of the Company
or any related corporation; or
(iii) Any person having a relationship which, in the opinion of the Board of Directors, would interfere with the exercise of
independent judgement in carrying out the function of the Audit Committee.
The members of Audit Committee shall elect a Chairman from amongst themselves who is not an Executive Director or employee
of the Company or any related corporation. It would be advantageous if the Chairman possess a strong personality, have knowledge
and experience in financial reporting, good leadership skills and is keen to get financial reporting and controls right.
All members of the Audit Committee, including the Chairman, will hold office only so long as they serve as Directors of the
Company. Should any member of the Audit Committee cease to be a Director of the Company, his membership in the Audit
Committee would cease forthwith.
It is desirable for membership on the Audit Committee to be rotated amongst all the Directors of the Company such that each
Director will serve a period of three (3) years on the Audit Committee.
If the members of the Audit Committee for any reason be reduced to below three (3), the Board of Directors shall within
three (3) months of the event, appoint such number of new members as may be required to make up the minimum number
of three (3) members.
B.
Objectives
The primary objectives of the Audit Committee are to:
(i)
Provide assistance to the Board in fulfilling its fiduciary responsibilities, particularly in the areas relating to the Company’s
accounting and management controls, financial reporting and business ethics policies.
(ii)
Provide greater emphasis on the audit function by increasing the objectivity and independence of external and internal
auditors and providing a forum for discussion that is independent of the Management.
(iii) Maintain through regularly scheduled meetings a direct line of communication between the Board and the external auditors,
internal auditors and financial management.
(iv) Strengthen the role of Non-Executive Directors by improving their knowledge and understanding of the Company’s operation.
(v)
Undertake such additional duties as may be appropriate and necessary to assist the Board. However, whether or not the Audit
Committee should undertake one or more of the additional duties rests on the Board’s viewpoint on corporate needs and the
environment in which the Company operates.
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C.
Duties And Responsibilities
In fulfilling its primary objectives, the Audit Committee will need to undertake the following duties and responsibilities:
C.1 Oversee All Matters Relating to External and Internal Audits
(i)
Review the annual audit plan with the external auditors. The Committee shall meet with the external auditors prior to the
commencement of the annual audit to discuss:
•
The general outline of the extent and timing of the auditors’ proposed coverage of location such as branches,
departments, factories, divisions and subsidiaries.
•
The nature of the audit procedures to be performed.
•
The extent of any planned reliance on the work of the internal auditors and the anticipated effect of this reliance on the examination.
•
Any significant accounting and auditing problems that the auditors can foresee.
•
The impact on the financial statements of any new or proposed changes in accounting standards or regulatory requirements.
•
The effect on the audit of significant data-processing systems.
Following review of the plan, the Audit Committee may request the external auditors to perform additional audit work directed to
specific areas of concern to the Committee.
(ii)
Oversee the Internal Audit Department. The Audit Committee in overseeing the Internal Audit Department will:
•
•
Review the audit programme, scope, performance and findings of the internal auditors.
Monitor the implementation of the programme so that sufficient internal audit coverage is accorded. In this respect, only
the Committee can consider and approve or otherwise, all requests by Senior Management to utilise the internal audit
personnel for non-audit assignments.
•
Assess the capacity of the Internal Audit Department to fulfil its responsibilities by considering, amongst other things, the
scope of the department’s authority as presented in the department’s charter, the qualifications and experience level of
its employee, the degree to which internal auditors are independent of the activities they audit and the reporting
relationship between the Head of Internal Audit and Senior Management.
•
To review the coordination of audit efforts between external and internal auditors, where practical, with a view to
maximizing audit effectiveness and controlling external audit costs.
(iii) Review the assistance and cooperation given by the Company’s officers to the external and internal auditors.
(iv) To nominate the external auditors for appointment.
(v)
The external and/or internal auditors shall have the right to appear and be heard at any meeting of the Audit Committee and
shall appear before the Audit Committee when required to do so by the Audit Committee.
(vi) Upon the request of the external and/or internal auditors, the Chairman of the Audit Committee shall convene a meeting of
the Committee to consider any matters the auditors believe should be brought to the attention of the Committee.
Puncak Niaga Holdings Berhad
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AU D I T CO M M I T T E E R E P O R T
C.2 Evaluate the Standards of Internal Control and Financial Reporting
(i)
Hold specific discussions with Senior Corporate Management to discuss the overall adequacy of the internal control system.
(ii)
Meet with the internal and external auditors concerning their evaluation of the system of internal accounting controls.
(iii) Consider the nature and disposition of the relevant comments appearing in the reports prepared by the internal auditors and
in the external auditors’ management letter.
C.3 Review of Financial Statements
(i)
Meet with the Management and the external auditors to discuss the annual financial statements of the Company or Group and
the results of the audit before recommending approval by the Board.
(ii)
Review the nature and resolution of any significant accounting and auditing problems encountered during the examination.
(iii) It is good practice for the Audit Committee to meet the Management at a regular interval to review the results of the Company
or Group, such as quarterly review of the results.
(iv) Review the nature of any related party transactions that may arise within the Company or Group.
(v)
Review the nature of any significant adjustments, reclassifications or additional disclosures proposed by the external auditors
that are currently significant or may become significant in the future.
(vi) Review the adequacy of disclosure of the impact of any changes during the year in accounting policies, standards and/or
regulatory requirements.
(vii) Review the reasons for the major fluctuations in financial statement balances for the current year compared to prior years.
(viii) Review for any unusual circumstances or situations reflected in the financial statements, including identifying any marginal operations.
(ix) Review the nature of any unusual or significant commitments or contingent liabilities.
(x)
Review of any significant differences between the annual report and other reports, such as reports to the regulatory agencies.
(xi) Review for any significant differences in format or disclosure from industry norms.
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C.4 Additional Duties and Responsibilities
(i)
Act upon the Board of Directors’ request to investigate and report on any issues or concerns in regard to the management of
the Company.
(ii)
Review the Company’s business ethics code, the method of monitoring, compliance with the code and the disposition of
reported exceptions.
(iii) Review executive expenses.
(iv) Review policies on sensitive payments.
(v)
Review compliance with certain government regulations.
(vi) Review policies to avoid conflicts of interest and review past or proposed transactions between the Company and members
of the Management.
(vii) Review certain aspects of the Company’s pension plan and compliance with relevant laws and regulations.
(viii) Assess the performance of financial management.
(ix) Such other functions as may be agreed to by the Audit Committee and the Board of Directors.
D.
Access to Records
In carrying out their duties and responsibilities, the Audit Committee will in principle have full, free and unrestricted access to all
Company records, property and personnel.
E.
Meetings and Minutes
It is good practice for the Audit Committee to hold a minimum of four (4) meetings a year, although additional meetings may be
called at any time at the Chairman’s discretion. It would be desirable that the notice of meetings be sent at least seven (7) days
before the time set for the meeting together with an agenda to all members of the Committee and any persons that may be
required to attend. The recommended quorum for each meeting shall be three (3) members.
In addition to the Committee members, the Head of Internal Audit Department will normally be in attendance at the meetings.
Representative of the external auditors are to be in attendance at meetings where matters relating to the audit of the statutory
accounts and/or the external auditors are to be discussed.
The Chief Executive Officer and/or other appropriate officers may be invited to attend, except for those portions of the meetings
where their presence is considered inappropriate, as determined by the Committee Chairman.
Minutes of each meeting shall be kept and distributed to each member of the Committee and also to the members of the Board.
The Committee Chairman shall report on each meeting to the Board. The Secretary to the Audit Committee shall be the Company
Secretary.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 91
risk m anagement
policy & report
RISK MANAGEMENT POLICY
In addition, the risk management framework which was established
The Board of Puncak Niaga Holdings Berhad has approved the
in October 2001 has since then been fully implemented by the
following Group’s Risk Management Policy Statement:
Management and employees of Puncak Niaga.
“The PNHB Group’s Risk Management Policy is to identify, measure
COMPLIANCE,
and control risks that may prevent the Group from achieving its
COMMITTEE (CICR)
objectives.
The establishment of the CICR was formalised by the Board in
INTERNAL
CONTROL
AND
RISK
POLICY
October 2001. The members of the CICR comprise the following:Our challenge is to apply risk management to all parts of our
business to ensure business risks are minimised and opportunities
Chairman :
enhanced.
Yang Berhormat Tan Sri Dato’ Seri Dr Ting Chew Peh
(Independent Non-Executive Director)
We will achieve, maintain and review a proper risk management
system. This commitment is driven by the Board of Directors, which
Members :
in turn is implemented by the Management and extends to all
Encik Matlasa Hitam
employees of the Group.
Managing Director
(Head of Compliance, Internal Control and Risk Policy
This
policy
statement
assigns
responsibility
for
risk
Committee w.e.f. 24 February 2005)
management to all PNHB Group employees and acknowledges
that corporate responsibility lies with the Board of Directors of
Madam Tan Bee Lian
the PNHB Group.”
Senior General Manager, Secretarial Department
RISK MANAGEMENT REPORT
Mr Ng Wah Tar
There are risks faced by all companies in the various facets of their
Senior General Manager, Finance and Accounts
corporate lives. The nature of such risks including systemic, market,
Department
employees, economic, legislation, financial and others, need to be
identified and managed to reduce the possibility and impact of any
Encik Sonari Solor
adverse effects. Puncak Niaga recognises this and has initiated risk
General Manager, Internal Audit Department
management programmes to ensure its business risks are
minimised and opportunities enhanced.
Secretary :
Encik Mohammed Sofian Ismail
The Board of Puncak Niaga established the following framework in
Senior Manager, Internal Audit Department
October 2001, for the management of the Group’s corporate risks:-
(Head of Risk Management Section)
1. Group’s Risk Management Policy Statement.
Apart from the change in the Head of the CICR Committee with
2. Formation of the Compliance, Internal Control and Risk Policy
effect from 24 February 2005, there was no change in the
Committee.
membership of the CICR during the year 2005.
3. Terms of Reference of the Compliance, Internal Control and Risk
Policy Committee.
A)
4. Setting up of a Risk Management Section, which reports to the
Compliance, Internal Control and Risk Policy Committee.
TERMS OF REFERENCE OF THE CICR
The CICR shall provide assistance to the Board of Directors of
Puncak Niaga in discharging its fiduciary responsibilities
relating to safeguarding shareholders’ investment and the
As a follow up from the Strategic Corporate Risk Management
Group’s assets through a structured approach to Risk
Workshop held for the Board and Senior Management in August
Management. The primary responsibilities of the CICR are:-
2001, information on Risk Management has been fully disseminated
to all employees in the form of booklets, posters and through the
Group’s internal communications network.
92
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
•
Formulating strategies to manage the overall risks associated
RISK MANAGEMENT SCORECARD WORKING GROUP AND
with the Group’s activities. This entails decisions on:-
ENTERPRISE-WIDE RISKS
The Group recognises that Risk Management involves a structured
-
Long-term and short-term strategies.
approach, combining the efforts of all functions within the Group, to
-
Justifiable capital allocation based on return per unit of risk.
minimise the possibility and impact of unexpected damages so as
to contribute towards greater efficiency and better decision
•
Recommending the appropriate risk management policies and
procedures, which shall be reviewed frequently to ensure
consistency with fundamental changes in the economy, market
conditions and regulations.
•
To periodically review the Group’s overall objectives by
assessing the current risk portfolio composition and
determining the desired exposures of each major area of risk.
•
To monitor and assess the risk portfolio composition of
making. The Group’s Enterprise-Wide Risk Profile is reviewed
annually to take into consideration changes in the business
environment, strategies and functional activities of the Group. The
Risk Management Scorecard Working Group (RMSWG), comprising
all Heads of Departments or their representatives, held two (2)
meetings in July 2005 to review the Group’s Enterprise-Wide Risk
Profile. The deliberations of the RMSWG were in turn reviewed by
the CICR Committee. Subsequently, a detailed Board Paper on the
Group’s Enterprise-wide Risks was submitted to the PNHB Board.
significant activities of the Group.
The Group’s Enterprise-Wide Risk Profile will again be reassessed by
•
To keep abreast of both current risk management techniques and
the Working Group in 2006.
theories, and any possible or actual changes in the regulatory
environment, and to recommend the appropriate action.
DIVISIONAL AND DEPARTMENTAL RISKS (PNSB)
The respective Heads of Divisions and Departments are responsible
B)
CICR ACTIVITIES
for assessing and managing their Divisional and Departmental risks.
MEETINGS HELD AND ISSUES COVERED
Using the Corporate Risk Scorecard software, the Heads of Divisions
During the year 2005, the CICR held nine (9) meetings, of which
and Departments have submitted their detailed risk scorecard reports
four (4) were chaired by Yang Berhormat Tan Sri Dato’ Seri Dr
to the Risk Management Section after the end of each quarter.
Ting Chew Peh (Chairman of CICR), four (4) by Encik Matlasa
Hitam (Head of CICR w.e.f. 24 February 2005) and one (1) was
CORPORATE RISK SCORECARD SOFTWARE
chaired by Encik Sonari Solor (Head of Internal Audit
PNHB / PNSB utilises a risk management tool namely, the Corporate
Department).
Risk Scorecard (‘CRS’) software to identify, measure and manage all
corporate risks affecting the Group. The CRS software offers a
At its meetings, the CICR reviewed in detail, the Status Reports
systematic approach to the management of enterprise-wide risks
prepared by the Risk Management Section. The issues covered
facing corporations and assists the Management of Puncak Niaga to
included the following:-
successfully achieve their corporate objectives.
1.
The level of readiness of the Group and the respective
RISK MANAGEMENT AT SYABAS
Divisions and Departments with regards to the “Statement
SYABAS took over the operations of PUAS on 1 January 2005. A formal
on Internal Control” requirements.
Risk Management structure was approved by the Board of SYABAS in
November 2005. The Risk Management structure at SYABAS is similar
2.
The progress of the risk assessment and risk monitoring
exercises at Departmental/Divisional and Enterprise-Wide
to that for PNHB / PNSB. The Risk Management Committee of SYABAS
held its first formal Meeting on 19 January 2006.
levels. The main risks, controls and management actions
are highlighted for the CICR to deliberate.
3.
The effective utilisation of the Corporate Risk Scorecard
software to identify, measure and monitor all corporate
risks identified within the Group.
4.
Other relevant risk issues affecting the Group, from time to
time.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 93
i n v e s t o r r e l at i o n s
policy & report
INVESTOR RELATIONS POLICY
As a responsible corporate citizen, Puncak Niaga is totally committed to upholding the highest standards of transparency, accountability and
integrity in the conduct of our business activities in the best interest of our shareholders as well as to allow potential investors to make
careful and informed investment decisions based on full and transparent disclosure of information.
Puncak Niaga’s Investor Relations Policy aims to build long-term relationships and credibility with our shareholders and potential investors
based on trust, honesty, openness, transparency and sound understanding of the Company.
To achieve its objectives, the Company will endeavour to undertake the following:
1. CREATING QUALITY DIALOGUE
•
To create an environment where the effective bilateral communication between the Company and our shareholders and investors
both informs and educates through regular, open and transparent provision of relevant and invaluable information over the long-term
which will build mutually beneficial long-term relationships vis-à-vis to foster a clearer understanding of the shareholders’ and
investors’ expectations of the Company.
•
To engage in quality dialogue with our shareholders and investors whereby the relationship is based on the principles of honesty,
openness and transparency and to foster mutual understanding between the Company and our shareholders and investors.
•
To reap the benefits of engaging in quality dialogue:
-
perception on our Company’s risk is reduced;
-
enhance feedback of our Company’s performance;
-
our Company’s share valuation becomes more realistic;
-
develop confidence in our Management team and management style; and
-
works as a guide in the evaluation of our Company’s business strategy.
2. INVESTOR COMMUNICATIONS STATEMENT
•
To implement an efficient and effective Investor Relations Programme as part of our ongoing shareholders’ and investors’
communication obligations.
•
To provide high quality, meaningful and timely information over and above that is required by law in order to improve the
shareholders’ and investors’ understanding of our Company.
•
To strive for key competence in the area of professional investor relations vide adequate resources and capability.
•
To earn the trust, respect and confidence of our existing shareholders and investors.
•
To build and maintain long-term relationships with our existing shareholders and investors.
•
To initiate long-term relationship building with potential shareholders and investors.
Our commitment to the above Policy is driven by the Board of Directors of the PNHB Group and implemented by the Management.
94
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
INVESTOR RELATIONS REPORT
Investor relations is the means by which listed companies maintain dialogue with their existing shareholders and potential investors. It is a
strategic management responsibility to present an accurate picture of corporate performance and prospects, thus allowing the investment
community, through an informed market, to determine a realistic share price. As a result, investor relations can have a positive impact on a
company’s market value and cost of capital relative to its industry sector and the overall economic climate.
The year 2005 has been challenging amidst Puncak Niaga’s relentless pursuit to gain leadership in the water industry.
The Board is therefore pleased to report on Puncak Niaga’s investor relations activities during 2005 as follows:DIALOGUES WITH INVESTORS
The Top Management of the Group actively engages in meetings, dialogues and briefing sessions with local and foreign investment groups.
During 2005, more than 52 dialogues and group briefing sessions were conducted with existing and potential investors, local and foreign
fund managers and financial analysts from research and asset management houses.
Puncak Niaga also participated in two investors’ conferences held in Singapore which were organised by CLSA Malaysia Sdn Bhd and CLSA
Pte Ltd on 2 February 2005 and 7 June 2005 respectively.
On 13 April 2005, an analyst presentation was held at the Shangri-La Hotel, Kuala Lumpur to clarify on issues pertaining to the privatisation
of the water distribution services under SYABAS. A total of 122 local and foreign analysts attended the presentation.
INVESTORS’ ACCESS TO INFORMATION
In line with our Investor Relations Policy, Puncak Niaga ensures timely disclosure of information over and above the regulatory authorities’
disclosure requirements so as to enable the investment community to make careful and informed investment decisions on the Company’s
securities. Shareholders and investors can access the Company’s information and corporate announcements at www.puncakniaga.com.my
or www.bursamalaysia.com.
Since 22 October 2004, in our efforts to meet disclosure obligations towards our shareholders, investors and stakeholders, the Group has
adopted and implemented the Puncak Niaga Corporate Disclosure Policy (as set out on page 98 of this Annual Report), formulated in line
with the ‘Guide On Best Practices In Corporate Disclosure’ issued by Bursa Malaysia’s Task Force on Corporate Disclosure Best Practices.
With the implementation of the Group’s Corporate Disclosure Policy and Procedures, all announcements made to Bursa Malaysia by the
Company are now simultaneously posted on the Company’s website at www.puncakniaga.com.my for access by the investing public.
The public may also access information on SYABAS at www.syabas.com.my
ANNUAL GENERAL MEETING (AGM)
The Board of Puncak Niaga firmly believes that the Annual General Meeting is the best forum to promote a closer relationship with our
shareholders, enabling us to continue our engagement process with them.
Since 2003, our Annual General Meeting has been preceded by a Company Presentation followed by a Questions and Answers Session. Our
shareholders are updated on the Group’s corporate performance, latest developments and issues of concern to the shareholders. This is
especially important as we are the water services provider in the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya
and our shareholders are our consumers. It is Puncak Niaga’s way of saying “We value your views” and “We are here to serve you better”.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 95
i n v e s t o r r e l at i o n s
policy & report
INVESTOR RELATIONS UNIT
The Investor Relations Unit (‘IRU’) maintains a database of shareholders and investors who wish to be updated on the Group’s corporate
developments and performance via e-mail.
Kindly e-mail us your contact details via investors@puncakniaga.com.my or write to us at Investor Relations Unit, c/o Secretarial Department,
Puncak Niaga Holdings Berhad, Suite 1701-1706, 17th Floor, Plaza See Hoy Chan, Jalan Raja Chulan, 50200 Kuala Lumpur, should you wish to
be included in our database.
Similarly, to enable us to further improve our level of services to the community and our stakeholders, kindly forward your comments,
views and concerns to the Company via our e-mail addresses at corpcom@puncakniaga.com.my for public enquiries and
investors@puncakniaga.com.my for investors’ enquiries.
All water-related enquiries in the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya, such as complaints on water
disruptions, pipe bursts, low water pressure, etc., may be addressed to SYABAS Customer Service Centre, puspel@syabas.com.my or the
toll-free line, 1-800-88-5252.
96
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
q ua l i t y p o l i c y & r e p o r t
QUALITY POLICY
It is the policy of Puncak Niaga to provide quality services to fulfil its contractual obligations to the Selangor State Government.
Puncak Niaga shall strive to consistently meet the quality standards pre-determined in the PCCA and CCOA. Puncak Niaga is fully committed
to perform all its obligations under the PCCA and CCOA with full responsibility, due diligence and efficiency.
To Be The Leading And Dynamic Integrated Water Services Company, we shall adopt a quality management system based on internationally
recognised standards, which will ensure a planned, systematic and proactive approach to quality in all aspects of our work.
Puncak Niaga’s quality management shall be characterised by:
•
proactiveness at all levels;
•
the consistent application of ‘Right First Time Every Time’ principle;
•
empowerment of employees to solve problems expeditiously; and
•
a culture of continuous improvement and teamwork.
All employees shall share the responsibility to understand and diligently implement the Quality Policy.
REPORT ON QUALITY CONTROL CIRCLE (QCC) COMMITTEE
The year 2005 saw the Company continuing to monitor the project implementation of the active circles which had successfully
completed their projects in 2003. The eight (8) active circles implementing the project for the period of January 2005 to September 2005
showed an average savings of RM31,902.38 per month (100.7% from the targeted savings of RM31,686.51 per month). Since these
projects have been implemented and are now considered as part of the Standard Operating Procedures (SOP) of the Operation I Division,
monitoring of the project by the QCC Committee is no longer necessary.
In August 2005, the Board of Directors directed for the QCC programme to be revived. Now known as Innovative and Creative Circle
(ICC), the new committee comprise members from various departments such as Finance, WTPs Operation, Internal Audit, Central
Laboratory and Process Improvement Section for a more efficient coordination and monitoring of new projects. A programme has been
scheduled in order to achieve the objective of ICC, which includes providing training and awareness seminars on ICC for the Top
Management and all employees. The first phase of the training is expected to commence in January 2006.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 97
co r p o r at e d i s c lo s u r e p o l i c y
As a responsible corporate citizen, Puncak Niaga is totally
•
Appoint a senior officer of the Company to oversee
committed to upholding the highest standards of transparency,
and coordinate disclosures to ensure the Company
accountability and integrity in the disclosure of all material
complies with the Bursa Malaysia Listing Requirements.
information on the Company to the investing public in an accurate,
clear, complete and timely manner in accordance with the
•
corporate disclosure requirements as set out in the Bursa Malaysia
Ensure
that
only
designated
persons
are
the
Company’s spokespersons.
Listing Requirements.
•
The primary objectives of Puncak Niaga’s Corporate Disclosure
Ensure
due
compliance
with
Puncak
Niaga’s
Corporate Disclosure Policy And Procedure.
Policy are :2.
1.
To promote and maintain market integrity and investor
EXERCISE DUE DILIGENCE AND PREPARATION
•
confidence.
Ensure
public
2.
that
the
persons
responsible
for
disseminating material information to the investing
exercise
due
diligence
in
ensuring
that
To provide equal access to the Company’s material information
information to be released is accurate, clear, timely
in an accurate, clear, timely and complete manner and to avoid
and complete.
selective disclosure to the investing public.
•
3.
Ensure that due care is observed when briefing and
To exercise due diligence such that information disseminated
responding to analysts, institutional investors, the
to the investing public will be as far as possible accurate, clear,
media and the investing public.
timely and complete.
3.
4.
To put in place an efficient management of information
procedure that promotes accountability for the dissemination
USE OF INFORMATION TECHNOLOGY
•
Take advantage of current information technology to
disseminate information to the investing public.
of material information to the investing public.
Our commitment to the above Policy is driven by the Board of
5.
To build good investor relations with the investing public based
on the principles of trust, honesty, openness, transparency and
sound understanding of the Company.
To achieve its objectives, the Company will endeavour to undertake
the following :1.
ESTABLISH POLICIES AND PROCEDURES
•
Ensure
written
Company
Policy
and
Procedure’)
policies
(‘Puncak
Puncak
that
and
procedures
of
the
Niaga’s
Corporate
Disclosure
Niaga’s
Corporate
Disclosure
encompass
the
Corporate
Disclosure Policy and other requirements relating to
corporate disclosure as set out in the Bursa Malaysia
Listing Requirements.
98
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
Directors of the PNHB Group and implemented by the Management.
distribution schedule of
equit y securities & properties
ORDINARY SHARES AS AT 27 APRIL 2006
Authorised Capital
:
RM1,000,000,000
Issued and Paid-Up Capital
:
RM464,228,000
Nominal Value
:
RM1.00 per ordinary share
Voting Rights
:
One vote per ordinary share
Holdings
No. of Holders
% of Holders
Total Holdings
% of Issued
308
3.48
8,990
*1
100 - 1,000
1,732
19.59
1,586,476
0.35
1,001 - 10,000
Capital
Less than 100
5,701
64.47
19,811,649
4.32
10,001 - 100,000
864
9.77
24,891,956
5.43
100,001 - 22,920,960 (less than 5% of issued capital2)
234
2.66
277,431,833
60.52
3
0.03
134,688,296
29.38
8,842
100.00
458,419,200
100.002
22,920,960 (less than 5% of issued capital2) and above
TOTAL
2
Notes:
1.
Less than 0.01%.
2.
Excluding a total of 5,808,800 Puncak shares bought back by Puncak and retained as treasury shares as at 27 April 2006.
Top Thirty Securities Account Holders As Per Record of Depositors
(Without aggregating the securities from different securities accounts belonging to the same Depositor)
No.
1.
Name of Shareholder
Central Plus (M) Sdn Bhd
2.
No. of
% of Issued
Shares Held
Capital *
65,371,446
14.26
Amsec Nominees (Tempatan) Sdn Bhd
- AmBank (M) Berhad For Central Plus (M) Sdn Bhd
40,000,000
8.73
3.
Employees Provident Fund Board
29,316,850
6.40
4.
Lembaga Tabung Haji
17,599,800
3.84
5.
AMMB Nominees (Tempatan) Sdn Bhd
- AmTrustee Berhad For Central Plus (M) Sdn Bhd (7/914-8)
17,026,000
3.71
6.
Corporate Line (M) Sdn Bhd
13,310,304
2.90
7.
Bumiputra-Commerce Nominees (Tempatan) Sdn Bhd
13,200,000
2.88
- Pledged Securities Account For Central Plus (M) Sdn Bhd (25000 JTRK)
8.
Cartaban Nominees (Asing) Sdn Bhd
9.
10.
- State Street Australia Fund ATB1 For Platinum Asia Fund
12,156,000
2.65
Central Plus (M) Sdn Bhd
11,740,500
2.56
10,000,000
2.18
9,000,000
1.96
Citigroup Nominees (Tempatan) Sdn Bhd
- CMS Dresdner Asset Management Sdn Bhd For Employees Provident Fund
11.
HSBC Nominees (Tempatan) Sdn Bhd
- Pledged Securities Account For Central Plus (M) Sdn Bhd (203-041884-089)
Notes:
*
Excluding a total of 5,808,800 Puncak shares bought back by Puncak and retained as treasury shares as at 27 April 2006.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 99
distribution schedule of
equit y securities & properties
No.
Name of Shareholder
12.
No. of
% of Issued
Shares Held
Capital*
6,523,750
1.42
6,000,000
1.31
6,000,000
1.31
5,000,000
1.09
4,820,100
1.05
4,801,600
1.05
4,623,200
1.01
4,000,000
0.87
AmBank (M) Berhad
- Pledged Securities Account For Central Plus (M) Sdn Bhd (SMART)
13.
HSBC Nominees (Tempatan) Sdn Bhd
- HSBC (M) Trustee Bhd For CMS Premier Fund (4959)
14.
Cartaban Nominees (Tempatan) Sdn Bhd
- Amanah SSCM Nominees (Tempatan) Sdn Bhd For Employees Provident Fund Board (JF404)
15.
RHB Capital Nominees (Tempatan) Sdn Bhd
- Pledged Securities Account For Central Plus (M) Sdn Bhd (TSR 681055)
16.
Takaful Nasional Sdn Berhad
- Malaysia National Insurance Berhad
17.
Amanah Raya Nominees (Tempatan) Sdn Bhd
- Skim Amanah Saham Bumiputera Permodalan Nasional Berhad
18.
Malaysia Nominees (Tempatan) Sendirian Berhad
- Amanah SSCM Asset Management Berhad For Amanah Millenia Fund Berhad (JM730)
19.
Bumiputra-Commerce Nominees (Tempatan) Sdn Bhd
- Pledged Securities Account For Central Plus (M) Sdn Bhd (17152 JTRK)
20.
HSBC Nominees (Asing) Sdn Bhd
21.
22.
- Exempt An For The Hongkong And Shanghai Banking Corporation Limited (HBFS-I CLT ACCT)
3,963,700
0.86
Malaysia National Insurance Berhad
3,662,200
0.80
3,572,200
0.78
3,344,700
0.73
3,245,000
0.71
3,173,000
0.69
3,000,000
0.65
2,784,900
0.61
2,344,800
0.51
2,024,200
0.44
HSBC Nominees (Asing) Sdn Bhd
- BNY Brussels For The Great Eastern Life Assurance Co Ltd
23.
CIMSEC Nominees (Tempatan) Sdn Bhd
- CIMB-Principal Asset Management Berhad For Employees Provident Fund Board
24.
Citigroup Nominees (Tempatan) Sdn Bhd
- ING Insurance Berhad (INV-IL PAR)
25.
ABB Nominee (Tempatan) Sdn Bhd
- Pledged Securities Account For Central Plus (M) Sdn Bhd (Jln Bunus)
26.
AMMB Nominees (Tempatan) Sdn Bhd
- CMS Dresdner Asset Management Sdn Bhd For
Tenaga Nasional Berhad Retirement Benefit Trust Fund (CMS-TNB)
27.
Amanah Raya Nominees (Tempatan) Sdn Bhd
- Public Growth Fund
28.
UOBM Nominees (Tempatan) Sdn Bhd
- Exempt An For Fortress Capital Asset Management (M) Sdn Bhd
29.
Cartaban Nominees (Tempatan) Sdn Bhd
- Exempt An For Amanah SSCM Nominees (Tempatan) Sdn Bhd
30.
Amanah Raya Nominees (Tempatan) Sdn Bhd
- Public Islamic Opportunities Fund
TOTAL
1,841,900
0.40
313,446,150
68.36
Notes:
*
100
Excluding a total of 5,808,800 Puncak shares bought back by Puncak and retained as treasury shares as at 27 April 2006.
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
Directors’ Interest in Ordinary Shares As Per Register of Directors’ Shareholdings
No. Of Shares Held In The Company
No.
Name of Director
Direct Interest
%4
1.
YBhg Tan Sri Rozali Ismail
2.
Encik Matlasa Hitam
3.
Encik Ruslan Hassan
4.
Indirect Interest
1,007,000
0.22
-
-
-
-
-
-
-
-
Ir Lee Miang Koi
144,000
0.03
2
0.02
5.
YBhg Tan Sri Dato’ Hari Narayanan Govindasamy
210,000
0.05
-
-
6.
YB Tan Sri Dato’ Seri Dr Ting Chew Peh
-
-
-
-
7.
Tuan Syed Danial Syed Ariffin
25,000
*3
-
-
8.
YB Datuk Dr Rahman Ismail
-
-
-
-
9.
Mr Tan Seng Lee
-
-
-
-
190,051,000
114,700
1
%4
41.46
Notes:
1.
Deemed interest by virtue of 50% equity interests each in Central Plus (M) Sdn Bhd and Corporate Line (M) Sdn Bhd respectively.
2.
Held in nominee names, Bumiputra-Commerce Nominees (Tempatan) Sdn Bhd and AmBank (M) Berhad.
3.
Less than 0.01%.
4.
Excluding a total of 5,808,800 Puncak shares bought back by Puncak and retained as treasury shares as at 27 April 2006.
Substantial Shareholders Based On The Register of Substantial Shareholders (Excluding Bare Trustees)
No. Of Shares Held In The Company
No.
Name of Substantial Shareholder
Direct Interest
%4
1.
YBhg Tan Sri Rozali Ismail
2.
Encik Shaari Ismail
1,007,000
0.22
-
-
3.
Central Plus (M) Sdn Bhd
77,111,946
4.
Employees Provident Fund Board
29,316,850
Indirect Interest
%4
190,051,000
1
41.46
190,051,000
1
41.46
16.82
99,628,750
2
21.73
6.40
21,424,400
3
4.67
Notes:
1.
Deemed interest by virtue of 50% equity interests each in Central Plus (M) Sdn Bhd and Corporate Line (M) Sdn Bhd respectively.
2.
Held in various nominee names.
3.
Shares held and managed by various Portfolio Managers.
4.
Excluding a total of 5,808,800 Puncak shares bought back by Puncak and retained as treasury shares as at 27 April 2006.
WARRANTS AS AT 27 APRIL 2006
Holdings
No. of
% of
Total
% of
Holders
Holders
Holdings
Warrants
133
3.58
6,074
0.01
100 - 1,000
1,248
33.57
1,021,336
0.95
1,001 - 10,000
1,657
44.57
7,268,285
6.74
582
15.65
19,298,049
17.89
97
2.61
31,707,676
29.39
1
0.02
48,573,449
45.02
3,718
100
107,874,869
100
Issued
Less than 100
10,001 - 100,000
100,001 - 5,393,742 (less than 5% of warrants issued)
5,393,743 (5% of warrants issued) & above
TOTAL
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 101
distribution schedule of
equit y securities & properties
Top Thirty Securities Account Holders As Per Record of Depositors
(Without aggregating the securities from different securities accounts belonging to the same Depositor)
No.
Name Of Warrant Holder
1.
2.
Corporate Line (M) Sdn Bhd
HSBC Nominees (Asing) Sdn Bhd
- Exempt An For JPMorgan Chase Bank, National Association (Bermuda)
DB (Malaysia) Nominee (Asing) Sdn Bhd
- Deutsche Bank AG Singapore PBD For Green Meadows Foundation
AmBank (M) Berhad
- Pledged Securities Account For Fang Kok Leong @ Phang Soon Fook (SMART)
CIMSEC Nominees (Asing) Sdn Bhd
- Exempt An For CIMB-GK Securities Pte Ltd (Retail Clients)
HSBC Nominees (Asing) Sdn Bhd
- CS Zurich For Pensionskasse Der Schweizerischen Bundesbahnen
DB (Malaysia) Nominee (Asing) Sdn Bhd
- Deutsche Bank AG Singapore PBD For Sea Crest Foundation
Cartaban Nominees (Asing) Sdn Bhd
- LBIE For Lehman Brothers International Europe (LBPB)
Cheong Pang Kwan
Inter-Pacific Equity Nominees (Tempatan) Sdn Bhd
- Pledged Securities Account For Lee Soo Ming (AL0010)
Teng U Heng
Citigroup Nominees (Asing) Sdn Bhd
- Exempt An For Merrill Lynch Pierce Fenner & Smith Incorporated (Foreign)
Amsec Nominees (Tempatan) Sdn Bhd
- Pledged Securities Account For Tan Say Teong
Low Han Kee
Lau Wai Fong
Public Nominees (Tempatan) Sdn Bhd
- Pledged Securities Account For Ong Seng Soon (E-TAI/KMT)
Kong Mah Realty (M) Sdn Bhd
Wong Kok Hou
Citigroup Nominees (Asing) Sdn Bhd
- Merrill Lynch International
Vast Uptrend Company Sdn Bhd
OSK Nominees (Tempatan) Sdn Berhad
- Pledged Securities Account For Ng Kok Hin
Mayban Nominees (Tempatan) Sdn Bhd
- Pledged Securities Account For Kuhan a/l Sivasambu (14570MZ0442)
Public Nominees (Tempatan) Sdn Bhd
- Pledged securities Account For Wong Kok Hou (E-KLC)
RHB Nominees (Tempatan) Sdn Bhd
- RHB Asset Management Sdn Bhd For Ng Siong Ket (EPF)
HSBC Nominees (Asing) Sdn Bhd
- HPBS SG For Info New Assets Limited
Lee Tai Leay
Mayban Nominees (Tempatan) Sdn Bhd
- Pledged Securities Account For Ng Siong Ket (101AB1038)
Mayban Nominees (Tempatan) Sdn Bhd
- Pledged Securities Account For Su Tiing Uh (178AW0603)
F.I.T Nominees (Asing) Sdn Bhd
- Platinum Broking Co Ltd For Mckenna Timothy
Ivy Ong Mun Yee
TOTAL
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
20.
21.
22.
23.
24.
25.
26.
27.
28.
29.
30.
102
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
No. of Warrants
Held
48,573,449
% of Warrants
Issued
45.03
1,503,200
1.39
1,400,000
1.30
1,266,300
1.17
1,000,000
0.93
1,000,000
0.93
957,600
0.89
931,400
826,000
0.86
0.77
800,000
735,000
0.74
0.68
725,000
0.67
704,300
700,000
600,000
0.65
0.65
0.56
583,000
525,000
525,000
0.54
0.49
0.49
502,350
500,000
0.47
0.46
497,000
0.46
479,800
0.44
409,400
0.38
405,000
0.38
400,000
400,000
0.37
0.37
400,000
0.37
363,000
0.34
350,000
343,000
68,404,799
0.32
0.32
63.42
Directors’ Interest in Warrant As Per Register of Directors’ Warrantholdings
No. Of Warrants Held In The Company
No.
Name of Director
1.
YBhg Tan Sri Rozali Ismail
2.
Encik Matlasa Hitam
-
3.
Encik Ruslan Hassan
21,600
4.
Ir Lee Miang Koi
18,000
5.
YBhg Tan Sri Dato’ Hari Narayanan Govindasamy
52,500
6.
YB Tan Sri Dato’ Seri Dr Ting Chew Peh
7.
Tuan Syed Danial Syed Ariffin
8.
YB Datuk Dr Rahman Ismail
-
-
-
-
9.
Mr Tan Seng Lee
-
-
-
-
1.
Direct Interest
%
-
-
Indirect Interest
48,573,449
%
1
45.03
-
-
-
0.02
-
-
0.02
-
-
0.05
-
-
-
-
-
-
-
-
-
-
Deemed interest by virtue of 50% equity interest in Corporate Line (M) Sdn Bhd.
LIST OF PROPERTIES AS AT 31 DECEMBER 2005
Description &
Date of
Location
Acquisition
Land Area
Net Book Value Tenure
(RM)
Remaining
Existing Use
Leasehold
(Expiry Date )
Vacant Land
14/02/1998
10,364 sq.m
8,019,392
H.S.(D) 142037
99 years
94 years
Rented out
Leasehold
expiring on
to a car park
17/12/2099
operator
99 years
97 years
Office Premises
Leasehold
expiring on
PT32, Section 14
Bandar Shah Alam
District of Petaling
Selangor
Wisma Rozali
01/08/2005
6,476 sq.m
33,823,282.30
No. 4, Persiaran Sukan
Seksyen 13
22/01/2102
40100 Shah Alam
Selangor Darul Ehsan
Vacant Land
H.S.(D) 181354
Lot 1722, Section 13
01/08/2005
6,476 sq.m
6,168,136.56
99 years
Leasehold
97 years
None
expiring on
22/01/2102
Bandar Shah Alam
District of Petaling
Selangor
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 103
// Water needs to reach every
plant on my land for my plants
to thrive and bloom beautifully
for my customers.
//
Since starting his plants nursery business 2 years ago, Encik Mohamad
Nazri discovered that the market for cut flowers and decorative plants
is very competitive. After experiencing a significant drop in piped
water pressure to his nursery, he was forced to incur additional costs
in hiring a water pump to maintain water pressure.
When approached for help in his predicament, Encik Mohamad Nazri
was thankful that SYABAS maintenance team located the cause of the
problem and quickly made the necessary repairs and adjustments to
restore optimum water pressure in his plants nursery.
104
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
contents
106-107
108-114
115
115
116
117
120
122-123
124-178
Directors Report
Statement by Directors
Statutory Declaration
Report of the Auditors
Income Statements
118-119
121
Definitions
Balance Sheets
Consolidated Statement of Changes in Equity
Statement of Changes in Equity
Cash Flow Statements
Notes to the Financial Statements
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 105
DEFINITIONS
Except where the context otherwise requires, the following definitions shall apply throughout this Directors' Report and Audited Financial
Statements for the year ended 31 December 2005:
"ABASS"
:
Konsortium ABASS Sdn Bhd
"BACP"
:
Bai Bithaman Ajil Commercial Papers
"BAIDS"
:
RM1,020,000,000 10-Year Al-Bai' Bithaman Ajil Islamic Debt Securities primary bonds together with
non-detachable secondary bonds
"BAMTN"
:
Bai Bithaman Ajil Medium Term Notes
"BBA"
:
Bai Bithaman Ajil
"BCB"
:
Bumiputra-Commerce Bank Berhad
"BIMB"
:
Bank Islam Malaysia Berhad
"BPMB"
:
Bank Pembangunan Malaysia Berhad
(formerly known as Bank Pembangunan dan Infrastruktur Malaysia Berhad)
"CCOA"
:
Construction Cum Operation Agreement
"CGE"
:
CGE Utilities (M) Sdn Bhd
"CIMB"
:
Commerce International Merchant Bankers Berhad
"CPMSB"
:
Central Plus (M) Sdn Bhd
"Company"
:
Puncak Niaga Holdings Berhad
"Distribution Area"
:
the state of Selangor, the Federal Territories of Kuala Lumpur and Putrajaya
"DSARA"
:
Debt Settlement And Restructuring Agreement
"DSRA"
:
Debt Service Reserve Account
"DSS II"
:
Sungai Selangor Water Supply Scheme Phase 2 Stage II - Distribution Supply System II
"EPF"
:
Employees Provident Fund
"ESOS"
:
Employees' Share Option Scheme
"Federal Government" :
Government of Malaysia
"Group"
:
Puncak Niaga Holdings Berhad Group of Companies
"HSBC"
:
HSBC Bank Malaysia Berhad
"JNA"
:
Junior Notes A, the 2001/2016 15-Year Redeemable Unconvertible Junior Notes issued by PNSB
"KDEB"
:
Kumpulan Darul Ehsan Berhad
106
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
"KHEC"
:
Kris Heavy Engineering & Construction Sdn Bhd
"Konajaya
:
Konajaya Sdn Bhd
"MASB"
:
Malaysian Accounting Standards Board
"MCPs"
:
Al-Murabahah Commercial Papers
"MGO"
:
Mandatory General Offer
"MMTNs"
:
Al-Murabahah Medium Term Notes
"MOF"
:
Minister of Finance, Incorporated
"MOU"
:
Memorandum of Understanding
"MSSB"
:
Mandai Sari Sdn Bhd
"NRW"
:
Non Revenue Water Works
"PCCA"
:
Privatisation Cum Concession Agreement
"PNSB"
:
Puncak Niaga (M) Sdn Bhd
"Premier Ayer"
:
Premier Ayer Sdn Bhd
"PUAS"
:
Perbadanan Urus Air Selangor Berhad
"RCULS"
:
Redeemable Convertible Unsecured Loan Stocks
"RM"
:
Ringgit Malaysia
"RPS"
:
Redeemable Cumulative Preference Shares
"RUN"
:
2001/2016 15-Year Redeemable Unconvertible Junior Notes issued pursuant to the RUN issue
"Serba Tiara"
:
Serba Tiara Sdn Bhd
"SPA"
:
Sale and Purchase Agreement
"SPLASH"
:
Syarikat Pengeluar Air Sungai Selangor Sdn Bhd
"SSP 2"
:
Sungai Selangor Water Supply Scheme Phase 2, Stages I and II
"State Government"
:
State Government of Selangor
"SYABAS"
:
Syarikat Bekalan Air Selangor Sdn Bhd
"Tekal Tiasa"
:
Tekal Tiasa Sdn Bhd
"the Deed"
:
Deed of Settlement dated 23 October 2003
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 107
directors’ report
for the financial year ended 31 December 2005
The Directors have pleasure in presenting their report together with the audited financial statements of the Group and of the Company for
the financial year ended 31 December 2005.
PRINCIPAL ACTIVITIES
The Group is engaged in the supply and distribution of treated water to consumers in the State of Selangor and the Federal Territories of
Kuala Lumpur and Putrajaya. The principal activities of the Company are that of investment holding and provision of management services.
The principal activities of the subsidiaries are disclosed in Note 16 to the financial statements.
The Group no longer supply treated water to the State Government, following the privatisation of water supply services in Selangor and the
Federal Territories of Kuala Lumpur and Putrajaya to the subsidiary company, SYABAS on 1 January 2005. There have been no other significant
changes in the nature of the principal activities during the financial year.
RESULTS
Group
Net profit for the financial year
Company
RM
RM
99,259,577
15,465,604
There were no material transfers to or from reserves or provisions during the financial year other than as disclosed in the Statements of
Changes in Equity.
In the opinion of the Directors, the results of the operations of the Group and of the Company during the financial year were not substantially
affected by any item, transaction or event of a material and unusual nature.
DIVIDENDS
The amount of dividends paid by the Company since 31 December 2004 were as follows:
In respect of the financial year ended 31 December 2004 as reported in the Directors' Report of that year:
RM
Final dividend of 5 sen per share less tax at 28% on 461,179,000 ordinary
shares, declared on 3 June 2005 and paid on 8 August 2005
16,602,444
At the forthcoming Ninth Annual General Meeting of the Company, a final dividend in respect of the financial year ended 31 December 2005,
of 6 sen per share less tax at 28% will be proposed for shareholders' approval. The financial statements of the current financial year do not
reflect this proposed dividend. Such dividend, if approved by the shareholders, will be accounted for in equity as an appropriation of retained
earnings in the financial year ending 31 December 2006.
SHARE CAPITAL
(a) Ordinary Shares Issued for Cash
During the financial year, the Company increased its issued and fully paid-up ordinary share capital from RM459,935,000 to
RM463,180,000 by way of:
(i) issuance of 1,745,000 ordinary shares of RM1.00 each for cash pursuant to the Company's ESOS at exercise prices of between
RM2.04 and RM2.71 per ordinary share. These new ordinary shares issued during the financial year rank pari-passu in all respects
with the existing ordinary shares of the Company.
(ii) issuance of 1,500,000 ordinary shares of RM1.00 at RM2.62 per share arising from the conversion of 1,500,000 units of Warrants
(Expiry date: 20 November 2006). These shares rank pari-passu in all respects with the existing ordinary shares of the Company
except that they shall not be entitled to the final dividend for the year ended 31 December 2004 which was paid by the Company on
8 August 2005.
108
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
SHARE CAPITAL (CONTD.)
(b) Treasury Shares
On 28 June 2005, the shareholders of the Company at the Extraordinary General Meeting of the Company approved the Company's
proposal to repurchase its own shares of up to 10% of its issued and paid-up share capital. The Directors of the Company are committed
to enhancing the value of the Company for its shareholders and believe that the repurchase proposal can be applied in the best interests
of the Company and its shareholders.
As at 31 December 2005, the Company had purchased a total of 5,808,800 ordinary shares of its issued and fully paid-up share capital
from the open market for a total consideration of RM15,057,236 at an average cost of RM2.59 per share. The acquisition of shares was
financed by internally generated funds.
Of the total 463,180,000 (2004: 459,935,000) issued and paid-up ordinary shares as at 31 December 2005, 5,808,800 (2004: Nil) are held
as treasury shares by the Company. As at 31 December 2005, the number of outstanding ordinary shares in issue and fully paid is
therefore 457,371,200 (2004: 459,935,000) ordinary shares of RM1.00 each.
DIRECTORS
The names of the Directors of the Company in office since the date of the last report and at the date of this report are:
Tan Sri Rozali bin Ismail
Ruslan bin Hassan
Lee Miang Koi
Syed Danial bin Syed Ariffin
Tan Sri Dato' Hari Narayanan a/l Govindasamy
Tan Sri Dato' Seri Dr Ting Chew Peh
Datuk Dr Rahman bin Ismail
Tan Seng Lee
(Appointed on 1 September 2005)
Matlasa bin Hitam
(Appointed on 1 October 2005)
Loong Chun Nee
(Resigned on 23 June 2005)
In accordance with Article 98 of the Company's Articles of Association, Ir Lee Miang Koi and YBhg Tan Sri Dato' Hari Narayanan a/l
Govindasamy retire from office by rotation at the forthcoming Ninth Annual General Meeting of the Company and, being eligible and upon
the recommendation of the Nominations Committee, offer themselves for re-election.
In accordance with Article 103 of the Company's Articles of Association, En Matlasa bin Hitam and Mr Tan Seng Lee who were appointed
since the last Annual General Meeting, retire from office at the forthcoming Ninth Annual General Meeting and, being eligible and upon the
recommendation of the Nominations Committee, offer themselves for election.
DIRECTORS' BENEFITS
Neither at the end of the financial year, nor at any time during that year, did there subsist any arrangement to which the Company was a
party, whereby the Directors might acquire benefits by means of the acquisition of shares in the Company or any other body corporate, other
than those arising from the share options granted under the ESOS.
Since the end of the previous financial year, no Director has received or become entitled to receive a benefit (other than benefits included
in the aggregate amount of emoluments received or due and receivable by the Directors as shown in Note 9 to the financial statements or
the fixed salary of a full-time employee of the Company) by reason of a contract made by the Company or a related corporation with any
Director or with a firm of which the Director is a member, or with a company in which the Director has a substantial financial interest, except
for YBhg Tan Sri Rozali bin Ismail who has deemed interests in a related party, RZ Management Services Sdn Bhd, which provides corporate
secretarial services to the Group.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 109
directors’ report
for the financial year ended 31 December 2005
DIRECTORS' INTERESTS
According to the register of Directors' shareholdings, the interests of Directors in office at the end of the financial year in shares, notes,
warrants and options in the Company and its related corporations during the financial year were as follows:
Number of Ordinary Shares of RM1.00 Each
At
Bought/
Sold/
At
1.1.2005
Transfer
Transfer
31.12.2005
Tan Sri Rozali bin Ismail
947,000
-
-
947,000
Ruslan bin Hassan
450,000
219,000
(524,000)
145,000
Lee Miang Koi
144,000
-
-
144,000
Tan Sri Dato' Hari Narayanan a/l Govindasamy
210,000
-
-
210,000
190,051,000
11,131,000
(11,131,000)
224,700
-
(110,000)
Direct interests in the Company:
Indirect interests in the Company:
Tan Sri Rozali bin Ismail
Lee Miang Koi
190,051,000*
114,700^^
Number of Share Options over Ordinary Shares of RM1.00 each
At
At
1.1.2005
Granted
Exercised
Lapsed
31.12.2005
Direct interests in the Company:
Tan Sri Rozali bin Ismail
1,523,000
-
-
-
1,523,000
Ruslan bin Hassan
1,186,000
-
(219,000)
-
967,000
Lee Miang Koi
340,000
-
-
-
340,000
Syed Danial bin Syed Ariffin
363,000
-
(65,000)
-
298,000
2001/2016 15-Year RUN in RM
At
1.1.2005
At
Bought
Sold
31.12.2005
12,879,204
-
(12,879,204)
-
708,125
-
-
708,125
39,900
-
-
39,900
7,729,687
-
(2,584,600)
Direct interests in the Company:
Tan Sri Rozali bin Ismail
Ruslan bin Hassan
Lee Miang Koi
Indirect interests in the Company:
Tan Sri Rozali bin Ismail
5,145,087^
Number 0f Warrants
At
1.1.2005
At
Bought
Sold
31.12.2005
Direct interests in the Company:
Ruslan bin Hassan
21,600
-
-
21,600
Lee Miang Koi
18,000
-
-
18,000
Tan Sri Dato' Hari Narayanan a/l Govindasamy
Matlasa bin Hitam
52,500
4,000**
-
(4,000)
52,500
-
-
(4,439,300)
Indirect interests in the Company:
Tan Sri Rozali bin Ismail
110
ANNUAL REPORT 2005
53,012,749
Puncak Niaga Holdings Berhad
48,573,449^
DIRECTORS' INTERESTS (CONTD.)
*
Deemed interest by virtue of 50% shareholding interest in both CPMSB, a substantial corporate shareholder, and in Corporate Line (M)
Sdn Bhd, a corporate shareholder of the Company.
^
Deemed interest by virtue of 50% shareholding interest in Corporate Line (M) Sdn Bhd.
^^ Held by nominees.
**
As at date of appointment on 1 October 2005.
None of the other Directors in office at the end of the financial year had any interest in shares, notes, warrants and share options in the
Company or its related corporations during the financial year.
ESOS
The ESOS of the Company, governed by the ESOS Bye-Laws, was principally approved by the shareholders of the Company at the
Extraordinary General Meeting of the Company held on 26 June 2001 and became effective following the implementation by the Company
on 25 February 2002. The ESOS shall be in force for a duration of five (5) years commencing from 25 February 2002.
The salient features of the ESOS are as follows:
(a) The ESOS is set up for the participation in ordinary shares of the Company only. The maximum number of new ordinary shares which
may be made available under the ESOS shall not exceed 10% of the total issued and paid-up ordinary shares of the Company at the point
in time when an offer is made.
(b) Eligible employees are those who have been in service with the Group for a continuous period of at least one (1) year including full-time
Executive Directors who are involved in the day-to-day management and on the payroll of the Group.
(c) The ESOS is administered by the Options Committee which comprise the following Executive Directors of the Company:
(i)
Tan Sri Rozali bin Ismail
(ii)
Ruslan bin Hassan
(Ceased as a member on 1 October 2005)
(iii)
Lee Miang Koi
(Ceased as a member on 1 October 2005)
(iv)
Tan Seng Lee
(Appointed on 1 September 2005)
(v)
Matlasa bin Hitam
(Appointed on 1 October 2005)
(vi)
Syed Danial bin Syed Ariffin
(Appointed on 1 October 2005)
(d) The share options granted under the ESOS may be exercised by the grantee by notice in writing to the Company during the period
commencing from the date of offer and before the expiry of the ESOS on 24 February 2007.
(e) The exercise price of the share options at which the eligible employees are entitled to subscribe for the ordinary shares of RM1.00 each
in the Company under the ESOS is the weighted average market price of the shares of the Company as quoted in the daily official list
issued by the Bursa Malaysia Securities Berhad for the five (5) market days immediately preceding the respective dates of offer subject
to a discount of not more than 10%, or at the par value of the ordinary shares of the Company of RM1.00 each, whichever is higher.
(f) The eligible employees to whom the share options have been granted have no right to participate, by virtue of the share options, in any
share issue of any other company within the Group.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 111
directors’ report
for the financial year ended 31 December 2005
ESOS (CONTD.)
(g)
The new ordinary shares issued arising from the ESOS shall rank pari-passu in all respects with the then existing ordinary shares of the
Company except that they shall not be entitled to any dividends, rights, allotments and/or other distributions, the entitlement date of
which is prior to the date of allotment of the said new ordinary shares.
(h) The basis on which the share options may be exercised, up to the expiry of the ESOS on 24 February 2007, in accordance with the
Directors' approval is as follows:
Number of share
options granted and
unexercised as at
Tranche
Percentage of share options exercisable
31 December 2005
2006
2007
%
%
1
9,177,000
100
100
2
430,000
100
100
3
638,000
100
100
4
623,000
100
100
5
785,000
100
100
6
414,000
100
100
7
2,733,000
100
100
8
1,351,000
100
100
16,151,000
The movements of the share options over the ordinary shares of RM1.00 each of the Company granted under the ESOS during the financial
year are as follows:
Tranche
Date of
Exercise
share
price per
options
share
Number of Share Options over Ordinary Shares of RM1.00 Each
At
granted
option
1.1.2005
At
Granted
Exercised
Lapsed *
31.12.2005
RM
*
112
1
26.2.2002
2.37
11,537,000
-
(1,076,000)
(1,284,000)
9,177,000
2
26.8.2002
2.47
676,000
-
(51,000)
(195,000)
430,000
3
26.2.2003
2.13
947,000
-
(270,000)
(39,000)
638,000
4
26.8.2003
2.71
776,000
-
(15,000)
(138,000)
623,000
5
26.2.2004
3.27
995,000
-
-
(210,000)
785,000
6
26.8.2004
2.04
751,000
-
(323,000)
(14,000)
414,000
7
26.2.2005
2.56
-
3,041,000
(3,000)
(305,000)
2,733,000
8
26.8.2005
2.40
-
1,351,000
-
-
1,351,000
15,682,000
4,392,000
(1,738,000)
(2,185,000)
16,151,000
Due to resignations or offers not taken up
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
ESOS (CONTD.)
The Company has been granted exemption by the Companies Commission of Malaysia from having to disclose the full list of share option
holders and their holdings, except for eligible employees (excluding Executive Directors) with share option allocation of 300,000 share
options and above, which are as follows:
Number of Share Options Over Ordinary Shares of RM1.00 each
At
Name of eligible employees
At
1.1.2005
Granted
Exercised
Lapsed *
31.12.2005
Nik Nazman bin Husin
400,000
-
(200,000)
-
200,000
Loh Kit Mun
140,000
-
-
-
140,000
Ramalingam a/l K.R. Arumugam
120,000
-
-
-
120,000
Tan Bee Lian
169,000
-
(51,000)
-
118,000
Sonari bin Solor
140,000
-
-
-
140,000
Ng Wah Tar
180,000
-
(39,000)
-
141,000
Loh Lim Chai Kheng
156,000
-
(48,000)
(108,000)
-
Chan Siew Meei
112,000
100,000
(10,000)
-
202,000
-
340,000
-
-
340,000
Sanusi bin Sulieman
*
Due to resignation
HOLDING COMPANY
The Company has no corporate shareholder being regarded by the Directors of the Company as the ultimate holding company nor as the
holding company.
OTHER STATUTORY INFORMATION
(a) Before the income statements and balance sheets of the Group and of the Company were made out, the Directors took reasonable steps:
(i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful
debts and satisfied themselves that all known bad debts had been written off and that adequate allowance had been made for
doubtful debts; and
(ii) to ensure that any current assets which were unlikely to realise their value as shown in the accounting records in the ordinary course
of business had been written down to an amount which they might be expected so to realise.
(b) At the date of this report, the Directors are not aware of any circumstances which would render:
(i) the amount written off for bad debts or the amount of the allowance for doubtful debts in the financial statements of the Group and
of the Company inadequate to any substantial extent; and
(ii) the values attributed to the current assets in the financial statements of the Group and of the Company misleading.
(c) At the date of this report, the Directors are not aware of any circumstances which have arisen which would render adherence to the
existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate.
(d) At the date of this report, the Directors are not aware of any circumstances not otherwise dealt with in this report or financial statements
of the Group and of the Company which would render any amount stated in the financial statements misleading.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 113
directors’ report
for the financial year ended 31 December 2005
OTHER STATUTORY INFORMATION (CONTD.)
(e) As at the date of this report, there does not exist:
(i) any charge on the assets of the Group or of the Company which has arisen since the end of the financial year which secures the
liabilities of any other person; or
(ii) any contingent liability of the Group or of the Company which has arisen since the end of the financial year.
(f) In the opinion of the Directors:
(i) no contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve (12) months
after the end of the financial year which will or may affect the ability of the Group or of the Company to meet their obligations when
they fall due; and
(ii) no item, transaction or event of a material and unusual nature has arisen in the interval between the end of the financial year and
the date of this report which is likely to affect substantially the results of the operations of the Group or of the Company for the
financial year in which this report is made.
SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR
Significant events during the financial year are disclosed in Note 45 to the financial statements.
SIGNIFICANT EVENTS SUBSEQUENT TO THE BALANCE SHEET DATE
Significant events subsequent to the balance sheet date are disclosed in Note 46 to the financial statements.
AUDITORS
The auditors, Ernst & Young, have expressed their willingness to continue in office.
Signed on behalf of the Board in accordance with a resolution of the Directors.
TAN SRI ROZALI BIN ISMAIL
MATLASA BIN HITAM
Director
Director
Kuala Lumpur, Malaysia
20 April 2006
114
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
S TAt e m e n t b y d i r e c t o r s
Pursuant to Section 169(15) of the Companies Act, 1965
We, TAN SRI ROZALI BIN ISMAIL and MATLASA BIN HITAM, being two of the Directors of PUNCAK NIAGA HOLDINGS BERHAD, do hereby state
that, in the opinion of the Directors, the accompanying financial statements set out on pages 117 to 178 are drawn up in accordance with
applicable MASB Approved Accounting Standards in Malaysia and the provisions of the Companies Act, 1965 so as to give a true and fair
view of the financial position of the Group and of the Company as at 31 December 2005 and of the results and the cash flows of the Group
and of the Company for the year then ended.
Signed on behalf of the Board in accordance with a resolution of the Directors.
TAN SRI ROZALI BIN ISMAIL
MATLASA BIN HITAM
Director
Director
Kuala Lumpur, Malaysia
20 April 2006
S TAT U T O RY D E C L A R AT I O N
Pursuant to Section 169(16) of the Companies Act, 1965
I, TAN SENG LEE, being the Director primarily responsible for the financial management of PUNCAK NIAGA HOLDINGS BERHAD, do solemnly
and sincerely declare that the accompanying financial statements set out on pages 117 to 178 are in my opinion correct, and I make this
solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960.
Subscribed and solemnly declared
by the abovenamed TAN SENG LEE
at Kuala Lumpur in the Federal Territory
on 20 April 2006
TAN SENG LEE
Director
Before me,
TEONG KIAN MENG
(No. W147)
Commissioner for Oaths
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 115
r e p o r t o f t h e au d i t o r s
to the members of Puncak Niaga Holdings Berhad (Incorporated in Malaysia)
We have audited the financial statements set out on pages 117 to 178. These financial statements are the responsibility of the Company’s
Directors.
It is our responsibility to form an independent opinion, based on our audit, on the financial statements and to report our opinion to you, as
a body, in accordance with Section 174 of the Companies Act, 1965 and for no other purpose. We do not assume responsibility to any other
person for the content of this report.
We conducted our audit in accordance with applicable Approved Standards on Auditing in Malaysia. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by the Directors, as well as evaluating the overall presentation of
the financial statements. We believe that our audit provides a reasonable basis for our opinion.
In our opinion:
(a) the financial statements have been properly drawn up in accordance with the provisions of the Companies Act, 1965 and applicable
MASB Approved Accounting Standards in Malaysia so as to give a true and fair view of:
(i) the financial position of the Group and of the Company as at 31 December 2005 and of the results and the cash flows of the
Group and of the Company for the year then ended; and
(ii) the matters required by Section 169 of the Companies Act, 1965 to be dealt with in the financial statements; and
(b) the accounting and other records and the registers required by the Act to be kept by the Company and by its subsidiaries of which we
have acted as auditors have been properly kept in accordance with the provisions of the Act.
We have considered the financial statements and the auditors’ reports thereon of the subsidiaries of which we have not acted as auditors,
as indicated in Note 16 to the financial statements, being financial statements that have been included in the consolidated financial
statements.
We are satisfied that the financial statements of the subsidiaries that have been consolidated with the financial statements of the Company
are in form and content appropriate and proper for the purposes of the preparation of the consolidated financial statements and we have
received satisfactory information and explanations required by us for those purposes.
The auditors’ reports on the financial statements of the subsidiaries were not subject to any qualification material to the consolidated
financial statements and did not include any comment required to be made under Section 174(3) of the Act.
ERNST & YOUNG
Tan Soo Yan
AF: 0039
No.1307/03/08(J/PH)
Chartered Accountants
Partner
Kuala Lumpur, Malaysia
20 April 2006
116
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
i n co m e s tat e m e n t s
for the year ended 31 December 2005
Group
Note
Revenue
Other operating income
5
6(a)
Raw materials and consumables
Construction contract expenses
Company
2005
2004
2005
2004
RM
RM
RM
RM
1,144,944,341
566,841,281
27,196,000
3,960,000
95,236,421
14,847,850
46,950,085
42,934,588
(317,665,683)
(116,626,504)
-
-
(72,507,284)
-
-
8
(126,016,569)
(28,618,312)
-
Other expenses
6(b)
(140,055,524)
(153,607,141)
(4,061,061)
(1,566,333)
Depreciation and amortisation expenses
6(c)
(245,445,244)
(103,113,120)
(88,045)
(88,045)
338,490,458
179,724,054
69,996,979
45,240,210
10
(143,550,090)
(98,116,646)
(46,903,881)
(42,936,238)
- Associate
17
(64,742)
-
- Jointly controlled entity
18
1,969,777
(4,488,185)
-
-
Profit before taxation
6
196,845,403
77,119,223
23,093,098
2,303,972
- Company and subsidiaries
11
(58,307,844)
(30,827,180)
(7,627,494)
- Associate
11
-
-
-
- Jointly controlled entity
11
-
147,226
-
Staff cost
Profit from operations
Finance cost
-
Share of results
-
-
Taxation:
(816,248)
-
(58,307,844)
(30,679,954)
(7,627,494)
Profit after taxation
138,537,559
46,439,269
15,465,604
Minority interests
(39,277,982)
-
-
-
99,259,577
46,439,269
15,465,604
1,487,724
3.60 sen
-
Profit for the financial year
(816,248)
1,487,724
Earnings per ordinary share:
- basic
12(a)
21.56 sen
10.16 sen
- diluted
12(b)
21.40 sen
9.80 sen
13
3.60 sen
-
Net dividends per ordinary
share in respect of the year
The accompanying notes form an integral part of the financial statements.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 117
balance sheets
as at 31 December 2005
Group
Note
2005
Company
2004
2005
2004
RM
RM
RM
RM
NON-CURRENT ASSETS
Property, plant and equipment
14
1,445,331,065
1,369,565,678
8,019,390
8,107,435
Project development expenditure
15
836,138,951
266,839,657
-
-
Investment in subsidiaries
16
-
-
163,923,980
161,123,980
Investment in associates
17
235,258
-
-
-
Interest in jointly controlled entity
18
7,773,914
(945,749)
7,773,914
3,046,798
Junior Notes A
19
-
-
279,896,378
247,220,143
Advances to a subsidiary
20
-
-
343,368,807
361,368,807
Debt service reserve account
21
272,209,530
264,932,902
-
-
Long-term receivables
22
506,016,000
518,566,000
-
-
Goodwill on consolidation
23
185,811,923
43,252,222
-
-
3,253,516,641
2,462,210,710
802,982,469
780,867,163
80,910,092
-
-
-
CURRENT ASSETS
Other investments
24
Inventories
25
15,025,612
1,142,270
-
-
Trade and other receivables
26
290,558,795
435,918,001
61,754,131
11,074,118
1,834,307
1,554,959
725,563
1,042,794
29
1,227,244,998
227,062,745
5,326,999
39,710,666
1,615,573,804
665,677,975
67,806,693
51,827,578
88,720,559
38,299,252
24,592,720
Tax recoverable
Deposits, cash and bank balances
LESS: CURRENT LIABILITIES
Trade and other payables
30
782,396,378
Hire-purchase payables
31
2,424,268
1,253,506
-
-
-
7,446,086
-
-
45,075,643
326,959,019
-
-
829,896,289
424,379,170
38,299,252
24,592,720
Tax payable
Borrowings
32
NET CURRENT ASSETS
118
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
785,677,515
241,298,805
29,507,441
27,234,858
4,039,194,156
2,703,509,515
832,489,910
808,102,021
Group
Note
Company
2005
2004
2005
2004
RM
RM
RM
RM
463,180,000
459,935,000
463,180,000
459,935,000
86,109,038
81,448,308
86,109,038
81,448,308
FINANCED BY:
Share capital
35
Share premium
Treasury shares
35(c)
Reserve on consolidation
Retained earnings
36
Shareholders' equity
Minority interests
(15,057,236)
-
(15,057,236)
-
92,322
92,322
-
-
740,323,962
657,666,829
18,361,730
19,498,570
1,274,648,086
1,199,142,459
552,593,532
560,881,878
40,477,983
-
-
-
1,315,126,069
1,199,142,459
552,593,532
560,881,878
NON-CURRENT LIABILITIES
Hire-purchase payables
31
6,259,735
3,191,674
-
-
Borrowings
32
2,369,519,060
1,172,677,315
279,896,378
247,220,143
Long-term payables
33
17,956,767
57,432,762
-
-
Deferred taxation
34
327,229,618
271,065,305
-
-
Government grant
37
3,102,907
-
-
-
2,724,068,087
1,504,367,056
279,896,378
247,220,143
4,039,194,156
2,703,509,515
832,489,910
808,102,021
The accompanying notes form an integral part of the financial statements.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 119
consolidated statement of changes in equity
for the year ended 31 December 2005
Non-distributable
Share
Note
At 1 January 2004
Issue of shares
35
Net profit for the financial year
At 31 December 2004
At 1 January 2005
Capital
Share
Distributable
Reserve on
Premium Consolidation
Retained
Earnings
Total
RM
RM
RM
RM
RM
451,166,000
69,527,248
92,322
8,769,000
11,921,060
-
-
20,690,060
-
-
-
46,439,269
46,439,269
459,935,000
81,448,308
92,322
657,666,829 1,199,142,459
459,935,000
81,448,308
92,322
657,666,829 1,199,142,459
611,227,560 1,132,013,130
Issue of shares
- Exercise of ESOS
35
1,745,000
2,230,730
-
-
3,975,730
- Conversion of warrants
35
1,500,000
2,430,000
-
-
3,930,000
(15,057,236)
-
-
(15,057,236)
Treasury shares
35(c)
Net profit for the financial year
Dividends
13
At 31 December 2005
-
-
-
99,259,577
99,259,577
-
-
-
(16,602,444)
(16,602,444)
463,180,000
71,051,802
92,322
The accompanying notes form an integral part of the financial statements.
120
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
740,323,962 1,274,648,086
s tat e m e n t o f c h a n g e s i n e q u i t y
for the year ended 31 December 2005
Note
Non-Distributable
Distributable
Share
Share
Retained
Capital
Premium
Earnings
Total
RM
RM
RM
RM
451,166,000
69,527,248
18,010,846
538,704,094
8,769,000
11,921,060
-
20,690,060
-
-
1,487,724
1,487,724
459,935,000
81,448,308
19,498,570
560,881,878
459,935,000
81,448,308
19,498,570
560,881,878
COMPANY
At 1 January 2004
Issue of shares
35
Net profit for the financial year
At 31 December 2004
At 1 January 2005
Issue of shares
- Exercise of ESOS
35
1,745,000
2,230,730
-
3,975,730
- Conversion of warrants
35
1,500,000
2,430,000
-
3,930,000
(15,057,236)
-
(15,057,236)
Treasury shares
35(c)
-
Net profit for the financial year
Dividends
At 31 December 2005
-
-
15,465,604
15,465,604
-
-
(16,602,444)
(16,602,444)
463,180,000
71,051,802
18,361,730
552,593,532
13
The accompanying notes form an integral part of the financial statements.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 121
c a s h f lo w s tat e m e n t s
for the year ended 31 December 2005
Group
Note
Company
2005
2004
2005
2004
RM
RM
RM
RM
1,389,017,504
714,351,477
-
-
59,204,253
-
25,000
-
(461,238,708)
-
-
-
-
19,494,720
2,764,800
(2,142,087)
(1,599,854)
CASH FLOWS FROM
OPERATING ACTIVITIES
Receipts from customer
Other operating income
Payments to water treatment operators
Dividend received
-
Payments for operating expenses
(516,237,456)
Payments to contractors
Net cash generated from operations
38
Net deposits received
Interest paid
(165,369,059)
(32,634,382)
(18,964,465)
-
-
438,111,211
530,017,953
17,377,633
1,164,946
36,079,177
-
10,000
-
(97,303,022)
(101,697,232)
Tax (paid)/refund
(9,868,964)
(8,835,899)
271,017
-
Interest received
11,389,009
2,304,787
14,463,038
14,946,954
(59,703,800)
(108,228,344)
1,109,637
1,162,707
378,407,411
421,789,609
18,487,270
2,327,653
5,886,818
Net cash inflow from operating activities
(13,634,418)
(13,784,247)
CASH FLOWS FROM
INVESTING ACTIVITIES
Acquisition of subsidiaries
16
Purchase of property, plant and equipment
Project development expenditure
Net advances to subsidiaries
(38,016,437)
-
(38,123,875)
(146,079,842)
(6,044,167)
-
-
(13,315,567)
(32,611,890)
-
-
-
-
(22,367,101)
(22,235,577)
(6,749,886)
(850,986)
Advance to jointly controlled entity
(6,749,886)
(850,986)
Purchase of unquoted investment
(80,000,000)
-
-
-
11,707
-
-
Proceeds from disposal of other investments
-
Proceeds from disposal of property,
plant and equipment
436,500
Net cash outflow from investing activities
122
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
(239,821,977)
140,000
(77,371,773)
(29,116,987)
(61,210,438)
Group
Note
Company
2005
2004
2005
2004
RM
RM
RM
RM
1,124,306,777
-
-
-
3,102,907
-
(16,602,444)
-
CASH FLOWS FROM
FINANCING ACTIVITIES
Proceeds from borrowings
Proceeds from government grant
Dividend paid
(16,602,444)
-
Exercise of share options pursuant to ESOS
3,975,730
20,690,060
3,975,730
20,690,060
Conversion of warrants
3,930,000
-
3,930,000
-
(15,057,236)
-
Acquisition of treasury shares
35(c)
Repayment of borrowings
Repayment of hire-purchase payables
(15,057,236)
-
(239,502,306)
(140,404,609)
-
-
(2,556,609)
(1,715,473)
-
-
-
13,911,300
-
-
861,596,819
(107,518,722)
(23,753,950)
20,690,060
1,000,182,253
236,899,114
(34,383,667)
(38,192,725)
227,062,745
170,163,631
39,710,666
77,903,391
-
(180,000,000)
-
-
Proceeds from repayment of
advance by a related party
Net cash inflow/(outflow)
from financing activities
NET CHANGE IN CASH AND CASH
EQUIVALENTS
CASH AND CASH EQUIVALENTS AT
BEGINNING OF FINANCIAL YEAR
Transfer to debt service reserve account
21
Designated account for
repayment of DSS II Term Loan
Deposits held in trust
29
(11,723,004)
-
-
-
29
(30,079,525)
-
-
-
29
(14,026,431)
(46,280,271)
-
(32,600,000)
1,171,416,038
180,782,474
5,326,999
7,110,666
1,094,503,919
177,713,646
5,000,000
32,600,000
-
-
-
Deposits for Standby Letters
of Credit and Ad-hoc Bank Guarantees
CASH AND CASH EQUIVALENTS AT END
OF FINANCIAL YEAR
Cash and cash equivalents comprise:
Deposits with licensed banks
Less: Deposits held in trust
29
(30,079,525)
Deposits for Standby Letters of Credit
and Ad-hoc Bank Guarantees
29
Cash and bank balances
(46,280,271)
-
(32,600,000)
1,050,397,963
(14,026,431)
131,433,375
5,000,000
-
132,741,079
49,349,099
326,999
7,110,666
-
-
-
180,782,474
5,326,999
7,110,666
Less: Designated account for repayment
of DSS II Term Loan
29
(11,723,004)
1,171,416,038
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 123
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
1.
CORPORATE INFORMATION
The Group is engaged in the supply and distribution of treated water to consumers in the State of Selangor and the Federal Territories
of Kuala Lumpur and Putrajaya. The principal activities of the Company are that of investment holding and provision of management
services.
The principal activities of the subsidiaries are disclosed in Note 16 to the financial statements.
The Group no longer supply treated water to the State Government, following the privatisation of water supply services in Selangor and
the Federal Territories of Kuala Lumpur and Putrajaya to the subsidiary company, SYABAS on 1 January 2005. There have been no other
significant changes in the nature of the principal activities during the financial year.
The Company is a public limited liability company, incorporated and domiciled in Malaysia, and is listed on the Main Board of the Bursa
Malaysia Securities Berhad. The registered office of the Company is as follows:
Suite 1701-1706, 17th Floor
Plaza See Hoy Chan
Jalan Raja Chulan
50200 Kuala Lumpur
The Company has no corporate shareholder being regarded by the Directors of the Company as the ultimate holding company nor as
the holding company.
The number of employees (including Executive Directors) in the Group and in the Company at the end of the financial year were 3,355
(2004: 696) and Nil (2004: Nil) respectively.
The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the Directors on
20 April 2006.
2.
FINANCIAL INSTRUMENTS
(a) Financial Risk Management Objectives and Policies
The Group's activities expose it to a variety of financial risks, including interest rate risk, market risk, credit risk, liquidity risk and
cash flow risk. The Group's overall financial risk management objective is to ensure that the Group creates value for its
shareholders. The Group manages the unpredictability of financial markets by securing most of its borrowings on fixed interest
rates. Finance risk management is carried out through risk reviews, internal control systems, insurance programmes and adherence
to Group financial risk management policies. The Board regularly reviews these risks and approves the risk management policies,
which covers the management of these risks.
(b) Interest Rate Risk
As at 31 December 2005, 99% (2004: 100%) of the Group's borrowings carry fixed interest rates. The Group's income and operating
cash flows are therefore substantially independent of changes in market interest rates.
(c) Market Risk
For key product and/or service purchases, the Group establishes floating and fixed priced levels that the Group considers
acceptable.
(d) Credit Risk
Credit risk arises when sales are made on deferred credit terms.
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2.
FINANCIAL INSTRUMENTS (CONTD.)
(d) Credit Risk (contd.)
Until 31 December 2004, the Group is solely dependent on the State Government, being a single customer for the purchase of its
treated water and due to this sole dependency on the State Government for revenue, any late or non-payment by the State
Government may have an adverse impact on the cash flows and/or profits of the Group. However, following the privatisation of the
water supply services in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya to SYABAS on 1 January 2005, the
Group no longer has any sole dependency on a single customer.
The Group manages its credit risk by establishing credit controls with the view to ensuring that overdue debts are within an
acceptable level.
The Group does not have any significant exposure to any individual customer or counterparty nor does it have any major
concentration of credit risk related to any financial instrument, except as disclosed in Note 22 and Note 26 to the financial
statements.
(e) Liquidity and Cash Flow Risk
Prudent liquidity risk management implies maintaining sufficient cash, the availability of funding through an adequate amount of
committed credit facilities and the ability to close out market positions. Due to the capital intensive and project based nature of
the underlying businesses, the Group aims at maintaining flexibility in funding by keeping committed credit lines available.
3.
AWARD OF CONCESSIONS
(a)
PNSB was awarded the following concessions by the State Government:
(i)
under the PCCA dated 22 September 1994, to take over, operate, maintain, manage, rehabilitate and refurbish existing water
treatment plants located in Selangor and Wilayah Persekutuan of Kuala Lumpur from the date of the PCCA to 31 December
2020;
(ii)
under the CCOA dated 22 March 1995, to design, construct, operate, maintain and manage the new water treatment facilities,
namely SSP 2 from the date of the CCOA to 31 December 2020; and
(iii) On 17 January 1998, PNSB was given a right by the Federal Government to develop a water treatment plant and its related
facilities in Wangsa Maju. The construction work commenced in January 1998 and was completed in July 1998. Subsequent to
the completion, PNSB has been managing, operating and maintaining the water treatment plant. The Concession Agreement
in relation to this water treatment plant for a period of 30 years ending 17 July 2028 was finalised and executed with the State
Government on 31 December 2004 ("Wangsa Maju WTP Concession Agreement").
On 31 December 2004, PNSB executed the following agreements in relation to the privatisation of the water supply services in the
State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya:
(i)
Novation Agreement to the PCCA and the CCOA between the State Government, PNSB and SYABAS, whereby SYABAS shall
assume the State Government's obligations under the PCCA and CCOA in relation to the following, with effect from 1 January
2005:
- purchase and payment of treated water to PNSB;
- the quality of treated water; and
- all operational matters relating to such purchase, payment and quality of treated water.
Puncak Niaga Holdings Berhad
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31 December 2005
3.
AWARD OF CONCESSIONS (CONTD.)
(ii)
Novation Agreement to the Wangsa Maju WTP Concession Agreement between the State Government, PNSB and SYABAS,
whereby SYABAS shall assume the State Government's obligations under the Wangsa Maju WTP Concession Agreement in
relation to the following with effect from 1 January 2005:
- purchase and payment of treated water to PNSB;
- the quality of treated water; and
- all operational matters relating to such purchase, payment and quality of treated water.
(iii) Supplemental Agreement (in relation to the PCCA dated 22 September 1994) between the State Government and PNSB. PNSB
agrees to a two percent (2%) reduction in the amounts outstanding and owing to PNSB under the PCCA as at 30 June 2004.
PNSB further agrees to an eight percent (8%) reduction, with effect from 1 July 2004 in the monthly billings to the State
Government under the PCCA.
In addition, PNSB shall be responsible for the management and operation of the Klang Gates, Tasik Subang and Sungai Langat
Dams.
(iv) Supplemental Agreement (in relation to the CCOA dated 22 March 1995) between the State Government and PNSB. PNSB
agrees to a two percent (2%) reduction in the amounts outstanding and owing to PNSB under the CCOA as at 30 June 2004.
PNSB further agrees to an eight percent (8%) reduction, with effect from 1 July 2004 in the monthly billings to the State
Government under the CCOA.
(b) On 15 December 2004, SYABAS executed a Concession Agreement with the Federal Government and the State Government in
relation to the privatisation of the water supply services in the State of Selangor and the Federal Territories of Kuala Lumpur and
Putrajaya. SYABAS is granted the right and authority by the Federal Government and the State Government to undertake the
following:(i)
the supply and distribution of treated water to consumers in the the Distribution Area;
(ii)
the purchase of treated water from the three (3) water treatment operators, namely PNSB, SPLASH and ABASS;
(iii) the taking over, upgrading, management, maintenance and protection of all water supply facilities within the Distribution Area;
(iv) the design, construction and completion of new water supply facilities works and the operation, maintenance and protection
of the same; and
(v)
the right to demand, collect and retain tariff for the supply and distribution of treated water and charges for the sale, rental or
installation of water supply facilities, as gazetted by the Federal Government or the State Government.
This Concession Agreement took effect on 1 January 2005.
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4.
SIGNIFICANT ACCOUNTING POLICIES
(a) Basis of Preparation
The financial statements of the Group and of the Company have been prepared under the historical cost convention unless
otherwise indicated. The financial statements are presented in RM and all values are rounded to the nearest ringgit except when
otherwise stated.
The financial statements comply with the provisions of the Companies Act, 1965 and applicable MASB Approved Accounting
Standards in Malaysia.
The preparation of the financial statements in conformity with the applicable MASB Approved Accounting Standards in Malaysia
and the provisions of the Companies Act, 1965 requires the Directors to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the
reported amounts of revenue and expenses during the reported financial year. Actual results could differ from those estimates.
(b) Basis of Consolidation
(i)
Subsidiaries
The consolidated financial statements include the financial statements of the Company and all its subsidiaries. Subsidiaries are
those entities in which the Group has power to exercise control over the financial and operating policies so as to obtain
benefits from their activities.
Financial statements of the subsidiaries are consolidated using the acquisition method of accounting or merger method of
accounting.
Acquisition Method
Under the acquisition method of accounting, the results of subsidiaries acquired or disposed of during the financial year are
included in the consolidated income statement from the effective date of acquisition up to the effective date of disposal, as
appropriate. The assets and liabilities of the subsidiary are measured at their fair values at the date of the acquisition. The
difference between the cost of an acquisition and the fair value of the Group’s share of the net assets of the acquired
subsidiary at the date of acquisition is included in the consolidated balance sheet as goodwill or negative goodwill arising on
consolidation.
Intra-group transactions, balances and resulting unrealised gains are eliminated on consolidation and the consolidated
financial statements reflect external transactions only. Unrealised losses are eliminated on consolidation unless costs cannot
be recovered.
The gain or loss on disposal of a subsidiary company is the difference between net disposal proceeds and the Group’s share
of its net assets together with any balance of goodwill and exchange differences.
Minority interests in the consolidated balance sheet consist of the minorities' share of the fair value of the identifiable assets
and liabilities of the acquiree as at acquisition date and the minorities' share of movements in the acquiree's equity since then.
Merger Method
Acquisition of subsidiaries that meets the conditions of merger are accounted for using the merger method. Under the merger
method of accounting, the results of subsidiaries are presented as if the merger had been effected throughout the current and
previous years. In the consolidated financial statements, the cost of the merger is cancelled with the nominal values of the
shares received. Any resulting credit difference is classified as equity and regarded as a non-distributable reserve. Any resulting
debit difference is adjusted against any suitable reserve.
Puncak Niaga Holdings Berhad
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31 December 2005
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTD.)
(b) Basis of Consolidation (contd.)
(ii) Associates
Associates are entities in which the Group exercises significant influence but not control, through participation in the financial
and operating policy decisions of the entity.
Investments in associates are accounted for in the consolidated financial statements by the equity method of accounting
based on the audited or management financial statements of the associates. Under the equity method of accounting, the
Group’s share of profits or losses of associate during the financial year is included in the consolidated income statement. The
Group’s interests in associates are carried in the consolidated balance sheet at cost plus the Group’s share of post-acquisition
retained earnings or accumulated losses and other reserves.
Unrealised gains on transactions between the Group and the associates are eliminated to the extent of the Group’s interests
in the associates. Unrealised losses are eliminated unless cost cannot be recovered.
(iii) Jointly Controlled Entity
A jointly controlled entity is an entity in which the Group has joint control over its economic activity established under a
contractual arrangement.
Interest in jointly controlled entity is accounted for in the consolidated financial statements by the equity method of accounting
based on the audited or management financial statements of the jointly controlled entity. Under the equity method of
accounting, the Group’s share of profits or losses of jointly controlled entity during the financial year is included in the
consolidated income statement. The Group’s interest in jointly controlled entity is carried in the consolidated balance sheet
at cost plus the Group's share of post-acquisition retained earnings or accumulated losses and other reserves.
Unrealised gains on transactions between the Group and its jointly controlled entity are eliminated to the extent of the Group’s
interest in the jointly controlled entity. Unrealised losses are eliminated unless cost cannot be recovered.
(c) Goodwill
Goodwill represents the excess of the cost of acquisition over the Group’s interest in the fair value of the identifiable assets and
liabilities of a subsidiary, associate or jointly controlled entity at the date of acquisition.
Goodwill is stated at cost less accumulated impairment losses. The policy for the recognition and measurement of impairment
losses is in accordance with Note 4(r). Goodwill arising on the acquisition of subsidiaries is presented separately in the balance
sheet while goodwill arising on the acquisition of associate and jointly controlled entity is included within the respective carrying
amounts of these investments.
The excess of the Group’s interest in the fair value of the identifiable assets and liabilities of a subsidiary, associate or jointly
controlled entity at the date of acquisition over the cost of acquisition is recognised in the income statement.
(d) Investments in Subsidiaries, Associates and Jointly Controlled Entity
The Company’s investments in subsidiaries, associates and jointly controlled entity are stated at cost less impairment losses. The
policy for the recognition and measurement of impairment losses is in accordance with Note 4(r).
On disposal of such investments, the difference between net disposal proceeds and their carrying amounts is recognised in the
income statement.
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Puncak Niaga Holdings Berhad
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTD.)
(e) Property, Plant and Equipment and Depreciation
Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses except for capital work-inprogress which are not depreciated. The policy for the recognition and measurement of impairment losses is in accordance with
Note 4(r).
Long-term leasehold land is stated at cost less accumulated amortisation and impairment losses. The long-term leasehold land is
amortised over the period of the lease of 99 years.
Concession assets comprise structures, land and buildings, water treatment plants and equipment, reservoirs, dams and
distribution pipes operated and maintained by the Group under the Concession Agreements entered into by the subsidiaries as
disclosed in Note 3 to the financial statements.
With effect from the current financial year, concession assets are depreciated over the concession period using the unit of water
revenue method as follows:
Cumulative actual water revenue
X
Concession assets capitalised to date
Total projected water revenue of the Concession
In previous financial years, concession assets are depreciated on a straight line basis over the period of the concession.
The rationale for using the unit of water revenue method is in line with the pattern in which the assets' economic benefits are
consumed by the Group.
The change in the above depreciation method is a change in accounting estimate and has been applied for prospectively.
The effect on the financial statements of this change in amortisation method is a decrease in amortisation charge for the year for
the Group by RM76.9 million and an increase in the Group's current year profit after tax and retained earnings carried forward by
RM55.4 million.
Depreciation of other property, plant and equipment is provided for on a straight-line basis to write off the cost of each asset to its
residual value over the estimated useful life, at the following annual rates:
Building
2%
Plant and equipment
10% to 20%
Water meters
10%
Office equipment
20%
Furniture and fittings
20%
Motor vehicles
20%
Computers and software
33 1/3%
Renovation
20% to 33 1/3%
Where an indication of impairment exists, the carrying amount of an asset is assessed and written down immediately to its
recoverable amount.
Upon the disposal of an item of property, plant or equipment, the difference between the net disposal proceeds and the net carrying
amount is recognised in the income statement.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 129
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31 December 2005
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTD.)
(f)
Leases
A lease is recognised as a finance lease if it transfers substantially to the Group all the risks and rewards incidental to ownership.
All other leases are classified as operating leases.
(i)
Finance leases
Assets acquired by way of hire-purchase or finance leases are stated at an amount equal to the lower of their fair values and
the present value of the minimum lease payments at the inception of the leases, less accumulated depreciation and
impairment losses. The corresponding liability is included in the balance sheet as borrowings. In calculating the present value
of the minimum lease payments, the discount factor used is the interest rate implicit in the lease, when it is practicable to
determine; otherwise, the Group’s incremental borrowing rate is used.
Lease payments are apportioned between the finance cost and the reduction of the outstanding liability. Finance cost, which
represent the difference between the total leasing commitments and the fair value of the assets acquired, are recognised as
an expense in the income statement over the term of the relevant lease so as to produce a constant periodic rate of charge
on the remaining balance of the obligations for each accounting period.
The depreciation policy for leased assets is in accordance with that for depreciable property, plant and equipment as described
in Note 4(e).
(ii) Operating leases
Operating lease payments are recognised as an expense in the income statement on a straight-line basis over the term of the
relevant lease.
(g) Project Development Expenditure
Project development expenditure are stated at cost less accumulated amortisation and impairment losses. The policy for the
recognition and measurement of impairment losses is in accordance with Note 4(r). Project development expenditure comprise the
following:
(i)
Expenditure incurred for the rehabilitation and refurbishment of water treatment facilities and concession acquisition cost.
These expenditure include capital work-in-progress, which are not amortised until the related asset are ready for its intended
use.
With effect from the current financial year, these expenditure are amortised over the concession period using the unit of water
revenue method as follows:
Cumulative actual water revenue
X
Project Development Expenditure incurred to date
Total projected water revenue of the Concession
In previous financial years, these project development expenditure are amortised on a straight line basis over the period of the
concession.
The rationale for using the unit of water revenue method is in line with the pattern in which the assets' economic benefits are
consumed by the Group.
The change in the above amortisation method is a change in accounting estimate and has been applied for prospectively.
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Puncak Niaga Holdings Berhad
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTD.)
(g) Project Development Expenditure (contd.)
The effect on the financial statements of this change in the amortisation method is a decrease in amortisation charge for the
year for the Group of RM16.4 million and an increase in the Group's current year profit after tax and retained earnings carried
forward by RM11.8 million.
(ii)
Capacity charge, annual charges and land use charges obligations arising from the concession agreement entered into by
SYABAS as disclosed in Note 3 to the financial statements.
These expenditure are amortised over the concession period using the unit of water revenue method as follows:
Cumulative actual water revenue
X
Total projected water revenue
Total projected capacity charge, annual charges and land use
charges for the entire concession period
of the Concession
(h) Construction Contracts
Where the outcome of a construction contract can be reliably estimated, contract revenue and contract costs are recognised as
revenue and expenses respectively by using the stage of completion method. The stage of completion is measured by reference
to the proportion of contract costs incurred for work performed to date to the estimated total contract costs.
Where the outcome of a construction contract cannot be reliably estimated, contract revenue is recognised to the extent of
contract costs incurred that is probable to be recovered. Contract costs are recognised as expenses in the period in which they
are incurred.
When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense
immediately.
When the total of costs incurred on construction contracts plus recognised profits (less recognised losses) exceeds progress
billings, the balance is classified as amount due from customers on contracts. When progress billings exceed costs incurred plus
recognised profits (less recognised losses), the balance is classified as amount due to customers on contracts.
(i)
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined on a weighted average basis and includes
transportation and handling costs incurred.
(j)
Trade and Other Receivables
Trade and other receivables are carried at anticipated realisable values. Bad debts are written off when identified. An estimate is
made for doubtful debts based on a review of all outstanding amounts as at the balance sheet date.
(k) Cash and Cash Equivalents
For the purposes of the cash flow statements, cash and cash equivalents include cash on hand and at banks and deposits at call
which have an insignificant risk of changes in value.
(l)
Provisions for Liabilities
Provisions for liabilities are recognised when the Group has a present obligation as a result of a past event and it is probable that
an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate of the
amount can be made. Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. Where
the effect of the time value of money is material, the amount of a provision is the present value of the expenditure expected to be
required to settle the obligation.
Puncak Niaga Holdings Berhad
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31 December 2005
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTD.)
(m) Income Tax
Income tax on the profit or loss for the year comprises current and deferred tax. Current tax is the expected amount of income
taxes payable in respect of the taxable profit for the year and is measured using the tax rates that have been enacted at the balance
sheet date.
Deferred tax is provided for, using the liability method, on temporary differences at the balance sheet date between the tax bases
of assets and liabilities and their carrying amounts in the financial statements. In principle, deferred tax liabilities are recognised
for all taxable temporary differences and deferred tax assets are recognised for all deductible temporary differences, unutilised tax
losses and unutilised tax credits to the extent that it is probable that taxable profit will be available against which the deductible
temporary differences, unutilised tax losses and unutilised tax credits can be utilised. Deferred tax is not recognised if the
temporary difference arises from goodwill or negative goodwill or from the initial recognition of an asset or liability in a transaction
which is not a business combination and at the time of the transaction, affects neither accounting profit nor taxable profit.
Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled,
based on tax rates that have been enacted or substantively enacted at the balance sheet date. Deferred tax is recognised in the
income statement, except when it arises from a transaction which is recognised directly in equity, in which case the deferred tax
is also recognised directly in equity, or when it arises from a business combination that is an acquisition, in which case the deferred
tax is included in the resulting goodwill or negative goodwill.
(n) Employee Benefits
(i)
Short-term benefits
Wages, salaries, bonuses and social security contributions are recognised as an expense in the year in which the associated
services are rendered by employees of the Group. Short-term accumulating compensated absences such as paid annual leave
are recognised when services are rendered by employees that increase their entitlement to future compensated absences,
and short-term non-accumulating compensated absences such as sick leave are recognised when the absences occur.
(ii) Defined contribution plans
As required by law, companies in Malaysia make contributions to the EPF. Such contributions are recognised as an expense in
the income statement as incurred. Once the contributions have been paid, the Group has no future obligations.
(iii) Equity compensation benefits
The ESOS allows the Group's employees to acquire ordinary shares of the Company. No compensation cost or obligation is
recognised. When the options are exercised, equity is increased by the amount of the proceeds received.
(o) Government grants
Government grants are recognised initially at their fair value in the balance sheet as deferred income when there is reasonable
assurance that the grant will be received and all attaching conditions will be complied with. Grants that compensate the Group for
the cost of an asset are recognised as income on a systematic basis over the useful life of the asset.
(p) Revenue Recognition
Revenue is recognised when it is probable that the economic benefits associated with the transaction will flow to the enterprise
and the amount of the revenue can be measured reliably.
(i)
Supply and Distribution of Treated Water to Consumers
Revenue is recognised when the treated water is discharged through the reading meter installed.
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Puncak Niaga Holdings Berhad
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTD.)
(p) Revenue Recognition (contd.)
(ii) Dividend Income
Dividend income is recognised when the right to receive payment is established.
(iii) Management Fee
Management fee is recognised on an accrual basis.
(iv) Construction Contracts
Revenue from construction contracts is accounted for using the stage of completion method as describe in Note 4(h).
(v) Interest Income
Interest is recognised on a time proportion basis that reflects the effective yield on the asset.
(q) Foreign Currencies
Transactions in foreign currencies are initially recorded in Ringgit Malaysia at rates of exchange ruling at the date of the transaction.
At each balance sheet date, foreign currency monetary items are translated into Ringgit Malaysia at exchange rates ruling at that
date, unless hedged by forward foreign exchange contracts, in which case the rates specified in such forward contracts are used.
Non-monetary items initially denominated in foreign currencies, which are carried at historical cost are translated using the
historical rate as of the date of acquisition and non-monetary items which are carried at fair value are translated using the
exchange rate that existed when the values were determined.
All exchange rate differences are taken to the income statement.
The principal exchange rate used for every unit of foreign currency ruling at the balance sheet date is as follows:
(r)
Currency
2005
2004
RM
RM
100 Indian Rupee
8.440
8.338
Impairment of Assets
At each balance sheet date, the Group reviews the carrying amounts of its assets to determine whether there is any indication of
impairment. If any such indication exists, impairment is measured by comparing the carrying values of the assets with their
recoverable amounts. Recoverable amount is the higher of net selling price and value in use, which is measured by reference to
discounted future cash flows.
An impairment loss is recognised as an expense in the income statement immediately.
(s) Other investments
Other investments are stated at cost less impairment losses. The policy for the recognition and impairment losses is in accordance
with Note 4(r). On disposal of an investment, the difference between net disposal proceeds and its carrying amount is recognised
in the income statement.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 133
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31 December 2005
4.
SIGNIFICANT ACCOUNTING POLICIES (CONTD.)
(t)
Equity and Financial Liabilities
Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into.
An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities.
Interest, dividends and gains and losses relating to a financial liability are reported as expenses or income. Distributions to holders
of equity instruments are recognised directly in equity.
(i)
Equity Instruments
Ordinary shares are classified as equity. Dividends on ordinary shares are recognised in equity in the period in which they are
declared.
The transaction costs of an equity transaction are accounted for as a deduction from equity, net of tax. Equity transaction costs
comprise only those incremental external costs directly attributable to the equity transaction which would otherwise have
been avoided.
(ii) Interest-Bearing Borrowings and Borrowing Costs
Interest-bearing borrowings are recorded at the amount of proceeds received, net of transaction costs.
Finance costs, including premiums payable on settlement or redemption and direct issue costs, are accounted for on an
accrual basis to the income statement using the effective interest method and are added to the carrying amount of the
instrument to the extent they are not settled in the period in which they arise.
Finance cost directly attributable to the acquisition, construction or production of qualifying assets, which are assets that
necessarily take a substantial period of time to get ready for their intended use or sale, are capitalised as part of the cost of
those assets, until such time as the assets are substantially ready for their intended use or sale. The amount of finance cost
eligible for capitalisation is determined by applying a capitalisation rate which is the weighted average of the finance cost
applicable to the Group’s borrowings that are outstanding during the financial year, other than borrowings made specifically
for the purpose of acquiring another qualifying asset. For borrowings made specifically for the purpose of acquiring a qualifying
asset, the amount of finance cost eligible for capitalisation is the actual finance cost incurred on that borrowing during the
period less any investment income on the temporary investment of funds drawn down from that borrowing facility.
(iii) Trade and Other Payables
Trade and other payables are stated at cost which is the fair value of the consideration to be paid in the future for goods and
services received.
(u) Fair Value Estimation for Disclosure Purposes
In assessing the fair value of financial instruments, the Group and the Company use a variety of methods and make assumptions
that are based on market conditions existing at each balance sheet date.
The fair value of publicly traded securities is based on quoted market prices at the balance sheet date. Where there is no active
market, fair value is established using a valuation technique. Valuation techniques include using recent arm's length market
transactions between knowledgeable, willing parties, if available, reference to the current fair value of another instrument that is
substantially the same, discounted cash flow analysis and option pricing models.
The face values for financial assets and financial liabilities with maturity of less than one (1) year are assumed to approximate their
fair values.
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ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
5.
REVENUE
Revenue of the Group and of the Company consists of the following:
Group
Company
2005
2004
2005
2004
RM
RM
RM
RM
1,071,046,600
-
-
-
Supply and distribution of
treated water to consumers
Invoiced value of bulk quantity of treated
water supplied to the State Government
-
566,841,281
-
-
73,897,741
-
-
-
Gross dividend income
-
-
27,076,000
3,840,000
Management fees
-
-
120,000
120,000
1,144,944,341
566,841,281
27,196,000
3,960,000
Construction revenue
With effect from 1 January 2005, SYABAS undertakes to supply and distribute treated water to consumers in the Distribution Area.
The construction revenue represents the revenue arising from the construction contract undertaken by a subsidiary, PNSB, in relation
to the turnkey sub-contract for planning, design, construction, supervision, testing and commissioning of a water supply scheme in the
State of Sabah.
6.
PROFIT BEFORE TAXATION
Profit before taxation is stated after charging/(crediting) the following:
(a) Other income
Included in other income of the Group and of the Company are the following:
Group
Interest on deferred payment contract
Coupon and discounts on Junior Notes A
Profits earned from deposits
Company
2005
2004
2005
2004
RM
RM
RM
RM
(4,308,148)
-
-
(2,091,926)
-
(46,348,110)
(41,225,017)
(22,271,981)
-
(6,346,560)
(566,793)
(1,709,520)
(2,925,300)
-
(247,001)
(116,642)
(1,603,350)
-
Income from liquidated ascertained
damages from contractors
-
-
-
-
Gain on disposal of property, plant
and equipment
Rental income from land and building
(35,000)
-
Income from property developers
(Note 6 (a)(i))
Reconnection charges
(i)
(49,418,926)
-
-
-
(1,579,298)
-
-
-
Income from property developers represents contributions by developers to improve and upgrade the distribution system.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 135
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
6.
PROFIT BEFORE TAXATION (CONTD.)
(b)
Other expenses
Included in other expenses of the Group and the Company are the following:
Group
Company
2005
2004
2005
2004
RM
RM
RM
RM
- Statutory audit
305,000
75,000
25,000
15,000
- Others
234,840
18,200
25,000
5,600
Auditors' remuneration (Note 7)
Auditors of the Company
Other Auditors
- Statutory audit
- Others
4,240
15,000
-
-
72,015
3,150
600
-
616,095
111,350
50,600
20,600
-
25,000,000
-
-
1,000,000
-
-
-
644,000
98,000
536,000
98,000
-
23,248,049
-
-
135,483
111,726,120
-
-
-
3,000
-
-
788,734
190,410
-
-
-
352
-
-
Others
Compensation for early termination
(Note 6 (b)(i))
Concession fees
Non-Executive Directors' remuneration
(Note 9)
Discounts given to customer
Debts written off (Note 6 (b)(ii))
Impairment of goodwill
Hire of transport and equipment
Loss on disposal of other investments
Allowance for diminution in value of
-
-
2,022,770
Allowance for doubtful debts
investment in jointly controlled entity
5,074,636
-
-
-
Rental of premises
2,968,788
2,475,970
-
-
Water royalty fees
14,126,313
-
-
-
(i)
Pursuant to the terms of an agreement reached between PNSB and CGE on 23 October 2003, PNSB had committed to pay to
CGE, a sum of RM25 million latest by 1 April 2006 as full and final settlement in respect of the mutual agreement between the
parties to bring forward the expiry date of the Operation and Maintenance Sub-Contract dated 31 May 1995 between PNSB,
MSSB, CGE and Veolia Water from 31 December 2020 to 31 December 2004. Accordingly, the settlement sum of RM25 million
has been accrued in the financial year for the year ended 31 December 2004.
136
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
6.
PROFIT BEFORE TAXATION (CONTD.)
(b) Other expenses (contd.)
(ii)
Debts written off during the financial year ended 31 December 2004 arose from the following:
-
Pursuant to the two (2) separate Supplemental Agreements in relation to the PCCA and CCOA executed between PNSB
and the State Government on 31 December 2004, PNSB agreed to a 2% reduction, which amounted to RM23.7 million on
the amount owing to PNSB as at 30 June 2004 by the State Government.
-
Pursuant to the DSARA executed between the State Government and PNSB and a Novation Agreement between the State
Government, PNSB and a special purpose company, Tekal Tiasa (both agreements executed on 19 January 2005), PNSB
agreed to accept payment of RM699.5 million in cash from Tekal Tiasa as full and final settlement of the outstanding trade
receivables of RM787.65 million owing by the State Government to PNSB. As a result of the said settlement, PNSB has
written off approximately RM88 million as irrecoverable debt.
(c) Depreciation and amortisation expenses
Group
Company
2005
2004
2005
2004
RM
RM
RM
RM
Depreciation of property, plant and equipment
- Concession assets
- Others
8,700,561
82,248,362
-
-
10,320,398
4,488,915
88,045
88,045
19,020,959
86,737,277
88,045
88,045
Amortisation of project development
expenditure
7.
226,424,285
16,375,843
-
-
245,445,244
103,113,120
88,045
88,045
AUDITORS' REMUNERATION
Group Income Statement
Group Balance Sheet
2005
2004
2005
2004
RM
RM
RM
RM
305,000
75,000
-
-
99,840
16,200
-
-
135,000
2,000
-
-
-
-
410,000
-
539,840
93,200
410,000
-
-
Auditors of the Company
Statutory audit
Fees for tax advisory compliance work
Other non-audit related services
Reporting accountants * (Note 32)
Other Auditors
Statutory audit
Fees for tax advisory compliance work
4,240
15,000
-
72,015
3,150
-
-
76,255
18,150
-
-
616,095
111,350
410,000
-
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 137
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
7.
AUDITORS' REMUNERATION (CONTD.)
Company Income Statement
2005
2004
RM
RM
Statutory audit
25,000
15,000
Fees for tax advisory compliance work
10,000
5,600
Other non-audit related services
15,000
-
50,000
20,600
Auditors of the Company
Other Auditors
Fees for tax advisory compliance work
*
600
-
50,600
20,600
These expenses are included as part of the debt issuance expenses as disclosed in Note 32. Debt issuance expenses are netted
off against the proceeds received by the Group in relation to the financial liabilities issued.
8.
STAFF COST
Group
Wages, salaries and bonuses
Defined contribution retirement plan
Other staff related expenses
Company
2005
2004
2005
2004
RM
RM
RM
RM
101,062,787
22,704,499
-
-
10,708,288
2,740,825
-
-
14,245,494
3,172,988
-
-
126,016,569
28,618,312
-
-
Included in staff cost of the Group are Executive Directors' remuneration amounting to RM9,275,123 (2004: RM6,836,647) as further
disclosed in Note 9.
The number of persons, including Executive Directors, employed by the Group at the end of the financial year was 3,355 (2004: 696).
The Group contributes to the EPF, the national defined contribution plan. Once the contributions have been paid, the Group has no
further payment obligations.
9.
DIRECTORS' REMUNERATION
The Directors of the Company in office during the financial year were as follows:
Executive Directors
Tan Sri Rozali bin Ismail
Ruslan bin Hassan *
Lee Miang Koi *
Syed Danial bin Syed Ariffin
138
Tan Seng Lee
(Appointed on 1 September 2005)
Matlasa bin Hitam
(Appointed on 1 October 2005)
Mat Hairi bin Ismail
(Resigned on 3 January 2005)
Loong Chun Nee
(Appointed on 3 January 2005; Resigned on 23 June 2005)
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
9.
DIRECTORS' REMUNERATION (CONTD.)
Non-Executive Directors
Tan Sri Dato' Hari Narayanan a/l Govindasamy
Tan Sri Dato' Seri Dr Ting Chew Peh
Datuk Dr Rahman bin Ismail
Abdul Majid bin Abdul Karim
*
(Resigned on 3 January 2005)
These Directors had been redesignated to Non-Independent Non-Executive Directors with effect from 1 October 2005.
The aggregate amount of emoluments receivable by the Directors of the Group and the Company during the financial year was as
follows:
Group
Company
2005
2004
2005
2004
RM
RM
RM
RM
Wages, salaries and bonuses
6,217,661
4,127,204
-
-
Defined contribution retirement plan
1,022,514
639,190
-
-
151,162
109,300
-
-
19,409
-
-
-
1,586,097
872,881
-
-
8,996,843
5,748,575
-
-
Allowances
401,000
98,000
401,000
98,000
Leave passage
135,000
-
135,000
-
9,532,843
5,846,575
536,000
98,000
Directors of the Company
Executive Directors
Estimated money value of benefits-in-kind
Leave passage
Other staff related expenses
Non-Executive Directors
Directors of subsidiaries
Executive Directors
Wages, salaries and bonuses
273,041
939,892
-
-
Defined contribution retirement plan
42,792
134,664
-
-
Estimated money value of benefits-in-kind
20,003
14,830
-
-
Leave passage
29,609
-
-
-
84,000
122,816
-
-
449,445
1,212,202
-
-
Other staff related expenses
Non-Executive Directors
Meeting allowances
Total
108,000
-
-
-
557,445
1,212,202
-
-
10,090,288
7,058,777
536,000
98,000
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 139
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
9.
DIRECTORS' REMUNERATION (CONTD.)
Group
Company
2005
2004
2005
2004
RM
RM
RM
RM
9,275,123
6,836,647
-
-
644,000
98,000
536,000
98,000
9,919,123
6,934,647
536,000
98,000
Analysis excluding benefits-in-kind
Total Executive Directors' remuneration excluding
benefits-in-kind (Note 8)
Total Non-Executive Directors' remuneration
excluding benefits-in-kind (Note 6 (b))
Total Directors' remuneration
excluding benefits-in-kind
The number of Directors of the Company whose total remuneration during the financial year fell within the following bands is analysed
below:
Number of Directors
2005
2004
Executive Directors
RM100,001 to RM200,000
1
-
RM300,001 to RM400,000
1
1
RM500,001 to RM600,000
2
-
RM700,001 to RM800,000
1
-
RM800,001 to RM900,000
-
2
RM1,000,001 to RM1,100,000
1
-
RM1,100,001 to RM1,200,000
-
1
RM1,200,001 to RM1,300,000
1
-
RM2,100,001 to RM2,200,000
-
1
RM4,300,001 to RM4,400,000
1
-
RM1 to RM100,000
1
3
RM100,001 to RM200,000
3
-
Non-Executive Directors
140
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
10. FINANCE COST
Group
Company
2005
2004
2005
2004
RM
RM
RM
RM
Finance cost on Islamic banking borrowings
91,542,054
79,224,118
-
-
Finance cost on conventional borrowings
51,194,395
52,639,076
46,799,263
41,225,017
Interest expense on hire-purchase
524,154
363,282
-
-
Bank charges
289,487
154,863
2,511
1,701
Write back of interest on Government Support Loan
-
(34,264,693)
-
-
Other interest expenses
-
-
102,107
1,709,520
143,550,090
98,116,646
46,903,881
42,936,238
The write back of interest on Government Support Loan in prior year arose from the reduction in interest rate from 8% per annum to
3% per annum.
11. TAXATION
Group
Company
2005
2004
2005
2004
RM
RM
RM
RM
2,143,531
15,957,722
7,627,494
816,248
-
(147,226)
-
-
56,164,313
14,869,458
-
-
58,307,844
30,679,954
7,627,494
816,248
1,997,251
1,234,993
7,442,684
816,248
146,280
14,575,503
184,810
-
Tax expense for the year:
Malaysian income tax
Foreign income tax
Deferred taxation (Note 34)
Current tax:
- Current financial year
- Under-provision in prior years
Deferred tax:
- Origination and reversal of temporary differences
56,164,313
14,869,458
-
-
58,307,844
30,679,954
7,627,494
816,248
58,307,844
30,827,180
7,627,494
816,248
Analysed as follows:
Tax expense for the year:
- Company and subsidiaries
- Jointly controlled entity
-
(147,226)
-
-
58,307,844
30,679,954
7,627,494
816,248
Domestic income tax is calculated at the Malaysian statutory tax rate of 28% (2004: 28%) of the estimated assessable profit for the year.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 141
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
11. TAXATION (CONTD.)
A reconciliation of income tax expense applicable to profit before taxation at the statutory income tax rate to income tax expense at
the effective income tax rate of the Group and of the Company is as follows:
Group
Profit before taxation
Company
2005
2004
2005
2004
RM
RM
RM
RM
196,845,403
77,119,223
23,093,098
2,303,972
55,116,713
21,593,382
6,466,067
645,112
4,181,106
3,610,106
976,617
171,136
-
-
-
-
(9,185,900)
-
-
146,280
14,575,503
184,810
-
838
86,863
-
-
58,307,844
30,679,954
7,627,494
816,248
Taxation at Malaysian statutory tax rate of 28%
(2004: 28%)
Expenses not deductible for tax purposes
Utilisation of previously unutilised tax allowances
(1,137,093)
Recognition of deferred tax assets not
recognised in prior years
Under-provision in prior years
Deferred tax assets not recognised
Tax expense for the year
A reconciliation of income tax rate to effective income tax rate of the Group and of the Company is as follows:
Group
Malaysian statutory tax rate
Expenses not deductible for tax purposes
Utilisation of previously unutilised tax allowances
Company
2005
2004
2005
2004
%
%
%
%
28.00
28.00
28.00
28.00
2.12
4.68
4.23
7.43
-
-
-
(0.57)
Recognition of deferred tax assets not
recognised in prior years
Under-provision in prior year
Deferred tax assets not recognised
142
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
-
(11.91)
-
-
0.07
18.90
0.80
-
-
0.11
-
-
29.62
39.78
33.03
35.43
12. EARNINGS PER ORDINARY SHARE
(a) Basic Earnings Per Share
Basic earnings per share of the Group is calculated by dividing the net profit for the financial year by the weighted average number
of ordinary shares in issue during the financial year.
Net profit for the financial year
Weighted average number of ordinary shares in issue
2005
2004
RM
RM
99,259,577
46,439,269
460,450,933
456,966,489
21.56 sen
10.16 sen
Basic earnings per share
(b) Diluted Earnings Per Share
For the purpose of calculating diluted earnings per share, the weighted average number of ordinary shares in issue during the
financial year have been adjusted for the dilutive effects of all potential ordinary shares, i.e. warrants, which were granted for free
to all subscribers of the RUN (Note 32(iv)) and share options granted to the eligible employees pursuant to the ESOS (Note 35(b)).
In assessing the dilution in earnings per share arising from the issue of both warrants and share options, a calculation is done to
determine the number of shares that could have been acquired at market price. This calculation serves to determine the "bonus"
element to the ordinary shares outstanding for the purpose of computing the dilution. No adjustment is made to net profit for the
financial year in the calculation of the diluted earnings per share in connection with the issue of the warrants and share options.
2005
2004
RM
RM
99,259,577
46,439,269
460,450,933
456,966,489
- warrants
1,410,051
13,534,699
- share options
1,917,604
3,596,795
463,778,588
474,097,983
21.40 sen
9.80 sen
Net profit for the financial year
Weighted average number of ordinary shares in issue
Adjustment for:
Weighted average number of ordinary shares for diluted earnings per share
Diluted earnings per share
13. DIVIDENDS
Dividends declared and paid by the Company in respect of the financial year ended 31 December 2004 are as follows:
Net Dividends
Amount
per Ordinary Share
2005
2004
2005
2004
RM
RM
sen
sen
16,602,444
-
3.60
-
Final dividend of 5 sen per share less tax
at 28% on 461,179,000 ordinary shares,
declared on 3 June 2005 and
paid on 8 August 2005
At the forthcoming Annual General Meeting, a final dividend in respect of the financial year ended 31 December 2005, of 6 sen per share
less tax at 28% will be proposed for shareholders' approval. The financial statements of the current financial year do not reflect this
proposed dividend. Such dividend, if approved by the shareholders, will be accounted for in equity as an appropriation of retained
earnings in the financial year ending 31 December 2006.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 143
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
14. PROPERTY, PLANT AND EQUIPMENT
Long-term
Plant
Furniture
Computers
leasehold
Water
Concession
and
Office
and
Motor
and
Building
land
meters
assets
equipment
equipment
fittings
vehicles
software
Renovation
2005
Total
RM
RM
RM
RM
RM
RM
RM
RM
RM
RM
RM
- 1,753,706,433
Group
2005
Cost
At 1 January
-
8,716,411
7,791,678
4,413,863
3,678,805
14,699,650
6,794,025
9,338,607 1,809,139,472
Additions
27,887,542
12,394,463
10,439,064
4,019,208
-
9,839,377
3,435,276
20,502,893
1,601,059
4,856,963
94,975,845
Disposals
-
-
-
-
-
-
-
(1,759,850)
-
-
(1,759,850)
27,887,542
21,110,874
10,439,064 1,757,725,641
7,791,678
14,253,240
7,114,081
33,442,693
8,395,084
-
608,976
- 407,098,840
3,328,180
2,542,297
3,289,079
9,733,632
6,320,284
6,652,506
439,573,794
232,396
146,235
394,219
8,700,561
777,728
1,584,815
497,560
4,283,904
552,473
1,851,068
19,020,959
-
-
-
-
-
-
-
(1,570,351)
-
-
(1,570,351)
232,396
755,211
394,219 415,799,401
4,105,908
4,127,112
3,786,639
12,447,185
6,872,757
8,503,574
457,024,402
27,655,146
20,355,663
10,044,845 1,341,926,240
3,685,770
10,126,128
3,327,442
20,995,508
1,522,327
5,691,996 1,445,331,065
At 1 January
-
8,716,411
- 1,751,138,439
7,870,045
2,580,736
3,424,601
12,288,275
6,576,052
6,233,797
1,798,828,356
Additions
-
-
2,163
465,714
101,843
2,625,425
217,973
2,517,048
8,498,160
2,338,791
At 31 December
14,195,570 1,902,355,467
Accumulated
Depreciation
At 1 January
Charge for the
financial year
Disposals
At 31 December
Net Book Value
At 31 December
Group
2004
Cost
-
2,567,994
Acquisition of
subsidiary
-
-
-
-
-
1,367,668
152,361
231,000
-
587,762
Disposals
(Note 16 (ii))
-
-
-
-
(80,530)
(255)
-
(445,050)
-
-
(525,835)
At 31 December
-
8,716,411
- 1,753,706,433
7,791,678
4,413,863
3,678,805
14,699,650
6,794,025
9,338,607
1,809,139,472
-
520,931
-
324,850,478
2,617,786
2,057,477
3,199,725
8,383,106
5,719,916
5,575,266
352,924,685
-
88,045
-
82,248,362
788,264
229,685
68,100
1,749,446
600,368
965,007
86,737,277
Accumulated
Depreciation
At 1 January
Charge for the
financial year
Acquisition of
subsidiary
-
-
-
-
-
255,344
21,254
30,800
-
112,233
419,631
Disposals
(Note 16 (ii))
-
-
-
-
(77,870)
(209)
-
(429,720)
-
-
(507,799)
At 31 December
-
608,976
-
407,098,840
3,328,180
2,542,297
3,289,079
9,733,632
6,320,284
6,652,506
439,573,794
-
8,107,435
- 1,346,607,593
4,463,498
1,871,566
389,726
4,966,018
473,741
2,686,101
1,369,565,678
Net Book Value
At 31 December
144
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
14. PROPERTY, PLANT AND EQUIPMENT (CONTD.)
Long-term leasehold land
2005
2004
RM
RM
8,716,411
8,716,411
608,976
520,931
COMPANY
Cost
At 1 January/31 December
Accumulated depreciation
At 1 January
Charge for the financial year
At 31 December
88,045
88,045
697,021
608,976
8,019,390
8,107,435
Net book value
At 31 December
At 31 December 2005, the unexpired period of lease of the long-term leasehold land is 94 years.
Included in the cost of concession assets are borrowing cost capitalised during the period of active development, amounting to
RM286,075,263 (2004: RM286,075,263).
Property, plant and equipment of the subsidiaries, PNSB and SYABAS, with a total net book value of RM1,326,489,081 (2004:
RM1,359,533,661) and RM37,104,053 (2004: Nil) respectively have been charged as security for long-term borrowings as disclosed in
Note 32(iii), Note 32 (v) and Note 32(vi).
During the financial year, the Group acquired property, plant and equipment at aggregate costs of RM94,975,845 (2004: RM10,836,951)
of which RM8,168,844 (2004: RM2,835,737) were acquired by means of hire-purchase arrangements.
Net book values of property, plant and equipment of the Group acquired under hire-purchase arrangement are as follows:
Group
2005
2004
RM
RM
20,213,710
13,770,246
(10,123,865)
(9,139,726)
10,089,845
4,630,520
Motor vehicles
Cost
Accumulated depreciation
Net book value
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 145
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
15. PROJECT DEVELOPMENT EXPENDITURE
Group
2005
2004
RM
RM
367,331,688
332,313,139
At cost:
At 1 January
Additions
Accumulated amortisation
At 31 December
795,723,579
35,018,549
1,163,055,267
367,331,688
(326,916,316)
(100,492,031)
836,138,951
266,839,657
16. INVESTMENT IN SUBSIDIARIES
Company
2005
Unquoted shares, at cost
2004
RM
RM
163,923,980
161,123,980
Details of the subsidiaries are as follows:
Equity Interest Held (%)
2005
2004
Name of Subsidiaries
Incorporated in Malaysia
PNSB #
100
100
Operation, maintenance, management, construction
and undertaking the rehabilitation and refurbishment
of water treatment facilities
70
70
Supply and distribution of treated water within
Selangor and the Federal Territories of Kuala Lumpur
and Putrajaya
Puncak Niaga (India) Sdn Bhd *
100
100
Dormant
Puncak Research Centre Sdn Bhd *
100
100
Dormant
Puncak Seri (M) Sdn Bhd *
100
100
Dormant
NS Water System Sdn Bhd *
100
100
Dormant
Held through 100% ownership by PNSB
Ideal Water Resources Sdn Bhd *
100
100
Operation,
management,
maintenance
and
undertaking the rehabilitation and refurbishment of
water treatment plants. Temporary ceased operations
on 1 September 2004.
100
100
Operation,
management,
maintenance
and
monitoring the operation of dams. Temporary ceased
operations on 1 September 2004.
70
-
SYABAS
Unggul Raya (M) Sdn Bhd *
Held through 70% ownership by SYABAS
PUAS
#
146
Principal activities
subsidiary consolidated using merger accounting method
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
Temporary ceased operations.
*
audited by a firm of auditors other than Ernst & Young
16. INVESTMENT IN SUBSIDIARIES (CONTD.)
Acquisition completed during financial year ended 31 December 2005
Acquisition of PUAS
On 8 December 2004, SYABAS had agreed to acquire the entire paid-up share capital of PUAS from KDEB, the attorney for MENTERI
BESAR Incorporated (1994) for a cash consideration of RM2.00. The effective date of the acquisition coincides with the operational date
of the Concession Agreement dated 15 December 2004 between SYABAS, the Federal Government and the State Government, which
took effect on 1 January 2005.
Acquisition completed during financial year ended 31 December 2004
(a) Acquisition of SYABAS
The Company had on 25 September 2003, entered into an Agreement For The Sale And Purchase Of Shares In SYABAS ("the
Agreement") with CPMSB, Tan Sri Rozali bin Ismail and Mat Hairi bin Ismail (collectively "the Vendors") to acquire 700,000 ordinary
shares of RM1.00 each, representing 70% of the issued and paid-up share capital of SYABAS from the Vendors at a total cash
consideration of RM38,009,840. The Agreement is conditional upon the signing of the Concession Agreement for the privatisation
of water supply services in the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya, which took place on
15 December 2004.
(b) Acquisition of Puncak Niaga (India) Sdn Bhd
On 26 October 2004, the Company acquired a wholly-owned subsidiary, Puncak Niaga (India) Sdn Bhd for a total consideration of
RM2.00 to facilitate the Group's future expansion plan to bid/tender for water related projects in India.
Effects of the acquisitions
(i)
The above acquisitions had the following effects on the Group's financial position:
Property, plant and equipment
2005
2004
RM
RM
-
1,919,160
Investment in associate
300,000
-
Other receivables
874,359
94,022
3,301,652
107,438
Cash and bank balances
Holding company
Other payables
(111,452,759)
-
(4,385,911)
(7,093,154)
Hire-purchase payables
Minority interest
Group's share of net liabilities
-
(159,663)
(1,218,315)
-
(112,580,974)
(5,132,197)
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 147
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
16. INVESTMENT IN SUBSIDIARIES (CONTD.)
Effects of the acquisitions (contd.)
(ii)
The fair values of the assets acquired and liabilities assumed from the acquisition of the subsidiaries were as follows:
Property, plant and equipment
Investment in associate
1.1.2005
15.12.2004
26.10.2004
RM
RM
RM
-
1,919,160
-
300,000
-
253,399,542
94,022
-
Inventories
8,891,152
-
-
Cash and bank balances
5,886,820
107,438
-
(7,089,306)
(2,998)
Receivables
Payables
(411,037,213)
Hire-purchase payables
-
Group's share of net assets
Goodwill on acquisition (Note 23)
Cost of acquisition
(159,663)
-
(142,559,699)
(5,128,349)
(2,998)
142,559,701
43,252,222
3,000
2
38,123,873
2
2
38,009,840
2
Cash outflow arising on acquisition:
Purchase consideration
Cost attributable to the acquisition, paid in cash
-
114,033
-
Total cost of acquisition
2
38,123,873
2
2
38,123,873
2
Cash outflow arising on acquisition:
Purchase consideration satisfied by cash
Cash and cash equivalents of subsidiary acquired
(5,886,820)
(107,438)
-
Net cash (inflow)/outflow of the Group
(5,886,818)
38,016,435
2
17. INVESTMENT IN ASSOCIATES
Group
2005
Unquoted shares, at cost
Share of post acquisition reserves
Less: Accumulated impairment losses
Company
2004
2005
2004
RM
RM
RM
RM
320,000
20,000
20,000
20,000
(84,742)
(20,000)
-
-
235,258
-
20,000
20,000
-
-
(20,000)
(20,000)
235,258
-
-
-
The Group's interests in the associates is analysed as follows:
Group
Share of net assets
148
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
2005
2004
RM
RM
235,258
-
17. INVESTMENT IN ASSOCIATES (CONTD.)
The Group's share of the revenue and expenses of the investment in associate is as follows:
Group
2005
2004
RM
RM
597,477
-
(662,219)
-
Revenue
Expenses excluding taxation
Loss from ordinary activities before taxation
(64,742)
Taxation
-
-
Loss for the financial year
-
(64,742)
-
Details of the associates are as follows:
Equity Interest Held (%)
Name of Associates
2005
2004
40
40
30
-
Principal Activities
Incorporated in Malaysia
NS Water Management Sdn Bhd *
Dormant
(Note a)
Poly Steel Pipe Sdn Bhd *
*
To carry out business as trader of steel pipes
audited by a firm of auditors other than Ernst & Young
Note a
As at 31 December 2005, the Group's share of losses of this associate equal to the cost of the investment. Accordingly, the Group
discontinued the recognition of further losses incurred by this associate.
18. INTEREST IN JOINTLY CONTROLLED ENTITY
Group
Advances to jointly controlled entity
Company
2005
2004
2005
RM
RM
RM
2004
RM
9,796,684
3,046,798
9,796,684
3,046,798
Less: Allowance for diminution in value
of investment
Share of net liabilities of the jointly controlled entity
-
-
9,796,684
3,046,798
(2,022,770)
(3,992,547)
-
-
(945,749)
7,773,914
3,046,798
7,773,914
(2,022,770)
7,773,914
3,046,798
The Group and the Company have a 70% interest in an unincorporated jointly controlled entity in India, PNHB-Lanco-KHEC Joint Venture,
which is presently in the construction industry.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 149
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
18. INTEREST IN JOINTLY CONTROLLED ENTITY (CONTD.)
The Group's share of the net assets and liabilities of the jointly controlled entity is as follows:
Group
2005
Non-current assets
Current assets
Current liabilities
Net liabilities
2004
RM
RM
134,663
39,760
178,744,398
179,178,531
(180,901,831)
(183,210,838)
(2,022,770)
(3,992,547)
The Group's share of the revenue and expenses of the jointly controlled entity is as follows:
Group
2005
Revenue
Expenses excluding taxation
Profit/(loss) from ordinary activities before taxation
Taxation
Profit/(loss) for the financial year
2004
RM
RM
6,055,082
3,277,448
(4,085,305)
(7,765,633)
1,969,777
(4,488,185)
-
147,226
1,969,777
(4,340,959)
19. JUNIOR NOTES A
Company
2005
Nominal value
Less: Yield to maturity
2004
RM
RM
546,875,000
546,875,000
(370,781,250)
(370,781,250)
At cost
176,093,750
176,093,750
Cumulative accretion of yield to maturity
103,802,628
71,126,393
279,896,378
247,220,143
The Company subscribed for RM546,875,000 nominal value of JNA issued on 20 November 2001 by its wholly-owned subsidiary, PNSB,
at an issue price of RM0.322 per RM1.00 nominal value of JNA. The JNA are redeemable, unconvertible, unsecured and substantially
mirror the structure of the RUN issued by the Company. The proceeds of the JNA was utilised to repay RM168,000,000 of PNSB's MCPs
with the remaining balance utilised for its working capital purposes.
The main features of the JNA are as follows:
(a)
The JNA carries a coupon rate of 2.5% per annum receivable semi-annually for the immediate ten (10) years from the date of issue
of the JNA and 3.5% per annum receivable semi-annually thereafter for the next five (5) years.
(b) PNSB shall redeem the JNA in ten (10) equal instalments each comprising 10% of the aggregate nominal value of all outstanding
JNA commencing on the sixth (6th) anniversary of the date of issue of the JNA. On the tenth (10th) anniversary of the date of issue
of the JNA, PNSB has the option to redeem the JNA by paying the principal amount outstanding on that date. On the same day, the
holders of the JNA also have the option to sell the JNA back to PNSB for a consideration equivalent to the principal amount
outstanding on that day.
150
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
19. JUNIOR NOTES A (CONTD.)
(c)
The JNA was issued back-to-back with the RUN. Proceeds from the RUN was immediately utilised to subscribe for the JNA by the
Company. Accordingly, the proceeds from the coupon payments and redemptions of the JNA would be utilised by the Company for
coupon payments and redemptions of the RUN.
The effective interest rate applicable to the JNA at the balance sheet date was 16.93% (2004: 16.93%) per annum.
20. ADVANCES TO A SUBSIDIARY
The advances to a wholly-owned subsidiary, PNSB, are unsecured, interest free and are not repayable within a period of twelve (12)
months from the date of the balance sheet.
21. DEBT SERVICE RESERVE ACCOUNT
Under the terms of agreement for the issue of the RM1,020,000,000 10-Year BAIDS and RM350,000,000 MCPs/MMTNs Issuance Facility
by its wholly-owned subsidiary, PNSB, a deposit equivalent to twelve (12) months projected payment obligations under the BAIDS and
MMTNs that are outstanding at any point in time is required to be placed in a DSRA. This DSRA is maintained with licensed financial
institutions. PNSB is not entitled to withdraw any money from the DSRA without prior written consent of the Security Trustee except on
condition that the BAIDS and MMTNs have been fully redeemed (Note 32 (iii)).
At the balance sheet date, the carrying amount of the deposits held in the DSRA approximated the fair value. The deposits held in the
DSRA is maintained for long-term until the full redemption and expiry of the BAIDS on 27 October 2016 (Note 32(iii)) and is presently
yielding interest income at market interest rates.
The weighted average effective interest rate applicable to the deposits held in the DSRA at the balance sheet date was 2.68% (2004:
2.73%).
22. LONG-TERM RECEIVABLES
The long-term receivables represent an amount due from a customer, i.e. State Government, in respect of the supply of bulk quantity
of treated water supplied to the State Government. On 3 February 2005, the State Government entered into a Novation Agreement with
Serba Tiara, whereby Serba Tiara shall assume and take over the State Government's obligations to pay to PNSB RM518.566 million in
ten (10) annual instalments commencing year 2006.
23. GOODWILL ON CONSOLIDATION
Group
At 1 January
Acquisition of subsidiaries (Note 16)
2004
RM
RM
43,252,222
-
142,559,701
43,255,222
185,811,923
43,255,222
Less: Impairment
At 31 December
2005
-
(3,000)
185,811,923
43,252,222
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 151
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
24. OTHER INVESTMENTS
Group
Unquoted investment, at cost
2005
2004
RM
RM
80,910,092
-
This represents fund placement in the AmAl-Amin.
25. INVENTORIES
Group
2005
2004
RM
RM
Water treatment chemicals
1,990,084
1,142,270
Spare parts and equipment
13,035,528
-
15,025,612
1,142,270
At cost:
26. TRADE AND OTHER RECEIVABLES
Group
2005
Company
2004
2005
2004
RM
RM
RM
RM
Trade receivables
292,672,062
404,993,550
-
-
Less: Allowance for doubtful debts
(72,750,127)
-
-
-
219,921,935
404,993,550
-
-
37,983,128
-
-
-
5,576,162
21,164,690
-
-
1,086,177
990,278
-
-
-
-
56,535,745
5,498,288
Interest receivable
2,268,880
336,604
712
364,466
Amount due from collection agencies
8,656,105
-
-
-
Progress billings receivable
Amount due from customer
on construction contract (Note 27)
Advances and loans to staff
Amounts due from subsidiaries (Note 28)
Sundry receivables
10,690,228
5,995,021
5,204,102
5,210,864
Deposits
2,465,887
2,004,102
500
500
Prepayments
1,910,293
433,756
13,072
-
290,558,795
435,918,001
61,754,131
11,074,118
The Group's normal credit term granted is 14 days (2004: 30 days). Other credit terms are assessed and approved on a case-by-case
basis.
Until 31 December 2004, the Group's credit risk is concentrated on a single trade receivable, which accounted for 92.9% of the total
trade and other receivables as at 31 December 2004. However, following the privatisation of the water supply services in Selangor and
the Federal Territories of Kuala Lumpur and Putrajaya to SYABAS on 1 January 2005, the Group no longer has any sole dependency on
a single trade customer.
152
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
26. TRADE AND OTHER RECEIVABLES (CONTD.)
The Group and the Company have the following concentration of credit risk:
Group
(i)
(a)
2004
2005
2004
RM
RM
RM
RM
37,983,128
-
-
-
In respect of progress
billings receivable (Note 26 (a))
(ii)
Company
2005
In respect of sundry receivables (Note 26 (b))
5,194,103
5,194,103
5,194,103
5,194,103
43,177,231
5,194,103
5,194,103
5,194,103
Progress billings receivable represent the amounts due from a customer on the construction contract undertaken by PNSB, in
relation to the turnkey sub-contract for planning, design, construction, supervision, testing and commissioning of a water supply
scheme in the State of Sabah.
(b) The Group and the Company's credit exposure are concentrated mainly on a single debtor in respect of the deposit paid to this
debtor for a joint-venture project.
27. CONSTRUCTION CONTRACTS
Group
2005
Construction contract costs incurred to date
RM
RM
77,668,833
21,164,690
Attributable profits
Less: Progress billings
2004
1,390,457
-
79,059,290
21,164,690
(73,483,128)
Amount due from customer on construction contract (Note 26)
5,576,162
21,164,690
The construction contract is undertaken by a wholly-owned subsidiary, PNSB and is in relation to the turnkey sub-contract for planning,
design, construction, supervision, testing and commissioning of a water supply scheme in the State of Sabah.
28. AMOUNTS DUE FROM/(TO) SUBSIDIARIES
The amounts due from/(to) subsidiaries as disclosed in Note 26 and Note 30 are interest free, unsecured and repayable on demand.
29. DEPOSITS, CASH AND BANK BALANCES
Group
Deposits with licensed banks
Cash and bank balances
Company
2005
2004
2005
RM
RM
RM
RM
1,094,503,919
177,713,646
5,000,000
32,600,000
132,741,079
49,349,099
326,999
7,110,666
1,227,244,998
227,062,745
5,326,999
39,710,666
Puncak Niaga Holdings Berhad
2004
A N N U A L R E P O R T 2 0 0 5 153
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
29. DEPOSITS, CASH AND BANK BALANCES (CONTD.)
Included in the deposits with licensed banks of the Group are restricted monies held for the following purposes:
Group
Ad-hoc Bank Guarantees
Standby Letters of Credit
Deposits held in trust
Company
2005
2004
2005
2004
RM
RM
RM
RM
14,026,431
13,680,271
-
-
-
32,600,000
-
32,600,000
30,079,525
-
-
-
11,723,004
-
-
-
55,828,960
46,280,271
-
32,600,000
Designated account for the repayment
of DSS II Term Loan (Note 32(ii))
Deposits held in trust represents consumers deposits collected by SYABAS with effect from 1 January 2005 following the privatisation
of water supply services in Selangor and the Federal Territories of Kuala Lumpur and Putrajaya.
Included in the deposits with licensed banks of the Group is RM862,619,286, being the deposit placed in an Escrow Account, held as
security for the BAMTN (Note 32(v)). These funds are made available for use by SYABAS in its operations, provided that the Debt to Equity
Ratio of SYABAS at the time of drawdown is not more than 75:25 from 2005 to 2008, both years inclusive and not more than 70:30 from
and including 2009 until the expiry of the BAMTN Programme.
The weighted average effective return applicable to deposits with licensed banks at the balance sheet date was 2.66% (2004: 2.59%)
per annum.
Deposits of the Group with licensed banks have an average maturity of 32 days (2004: 52 days).
30. TRADE AND OTHER PAYABLES
Group
2004
2005
2004
RM
RM
RM
RM
Trade payables (Note 30 (a))
194,409,354
59,173,348
-
-
Amounts due to contractors
22,001,180
187,521
-
-
-
-
36,655,355
22,891,304
32,113,715
19,025,823
1,535,744
1,498,288
Amount due to a subsidiary (Note 28)
Finance cost payable (Note 30 (b))
Deposit from consumer
300,799,783
-
-
-
Accruals (Note 30 (c))
233,072,346
10,315,402
108,153
203,128
Amount owing to Directors
154
Company
2005
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
-
18,465
-
-
782,396,378
88,720,559
38,299,252
24,592,720
30. TRADE AND OTHER PAYABLES (CONTD.)
The credit term of the trade payables granted to the Group is 30 days (2004: 30 days).
(a)
Included in trade payables is an amount of RM38,131,931 (2004: RM57,362,080), being the short-term portion of the amount
payable by PNSB to MSSB as disclosed in Note 33 (a).
(b) Included in the finance cost payable of the Group is an amount of RM1,632,433 (2004: RM1,632,433), being the short-term portion
of the interest payable by PNSB pursuant to the Supplemental Agreement to the Government Support Loan Agreement, as
disclosed in Note 33 (b).
(c)
Included in accruals is an amount of RM21,000 (2004: RM21,000), which is amount due to a subsidiary of CPMSB, a substantial
corporate shareholder of the Company.
31. HIRE-PURCHASE PAYABLES
Group
2005
2004
RM
RM
Payable within one year
2,916,204
1,566,364
Payable between one and two years
2,677,256
1,503,051
Payable between two and five years
4,160,843
2,017,650
9,754,303
5,087,065
Minimum lease payments:
Less: Finance cost
(1,070,300)
(641,885)
8,684,003
4,445,180
Payable within one year
2,424,268
1,253,506
Payable between one and two years
2,359,443
1,304,094
Payable between two and five years
3,900,292
1,887,580
8,684,003
4,445,180
Payable within 12 months
2,424,268
1,253,506
Payable after 12 months
6,259,735
3,191,674
8,684,003
4,445,180
Present value of finance lease payables:
Analysed as:
The weighted average effective interest rate per annum applicable to hire-purchase payables as at balance sheet date were as follows:
Weighted average effective
interest rate
2005
2004
%
%
2.64
4.73
Group
Hire-purchase payables
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 155
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
32. BORROWINGS
Analysis of borrowings:
Total carrying
amount
RM
< 1 year
RM
85,899,231
11,723,004
1,012,696,373
275,685,085
995,139,871
6,052,639
11,723,004
-
6,234,218
180,000,000
54,687,500
-
19,847,425
480,000,000
164,062,500
-
53,764,949
352,696,373
56,935,085
995,139,871
6,151,139
2,387,294,703
17,775,643
240,921,718
663,909,925
6,151,139
1,464,687,417
Unsecured:
Revolving Credit
Total borrowings
27,300,000
2,414,594,703
27,300,000
45,075,643
240,921,718
663,909,925
1,464,687,417
Less: Short-term borrowings
classified under
current liabilities
Long-term borrowings
(45,075,643)
2,369,519,060
35,876,349
51,082,670
180,000,000
60,000,000
326,959,019
6,052,639
11,723,004
180,000,000
197,775,643
19,269,345
510,000,000
164,062,500
693,331,845
60,577,246
142,561,662
78,430,919
281,569,827
Group
As at 31 December 2005
Secured:
Government Support Loan
(Note 32 (i))
DSS II Term Loan (Note 32 (ii))
BAIDS (Note 32 (iii))
RUN (Note 32 (iv))
BAMTN (Note 32 (v))
RM410 million and
RM250 million Term Loans
(Note 32 (vi))
156
Group
As at 31 December 2004
Secured:
Government Support Loan
(Note 32 (i))
DSS II Term Loan (Note 32 (ii))
BAIDS (Note 32 (iii))
MCPs/MMTNs (Note 32 ((iii))
RUN (Note 32 (iv))
Total borrowings
121,775,579
62,805,674
1,012,561,662
60,000,000
242,493,419
1,499,636,334
Less: Short-term borrowings
classified under
current liabilities
Long-term borrowings
(326,959,019)
1,172,677,315
Maturity profile
1 - 2 years
2 - 5 years
RM
RM
> 5 years
RM
Company
As at 31 December 2005
Secured:
RUN (Note 32 (iv))
279,896,378
-
54,687,500
164,062,500
61,146,378
As at 31 December 2004
Secured:
RUN (Note 32 (iv))
247,220,143
-
-
164,062,500
83,157,643
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
32. BORROWINGS (CONTD.)
Analysis of borrowings (contd.):
The BAMTN, BAIDS and RUN are further analysed as follows:
Nominal value
Group
Group
BAIDS
RUN
2005
RM
RM
RM
RM
RM
RM
RM
RM
- 1,020,000,000
1,020,000,000
546,875,000
546,875,000
546,875,000
546,875,000
(370,781,250)
(370,781,250)
(370,781,250)
(370,781,250)
176,093,750
176,093,750
176,093,750
176,093,750
(5,848,665)
-
-
176,093,750
1,000,229,500
-
(10,532,693)
- 1,009,467,307
(10,532,693)
1,009,467,307
2005
RUN
2004
(29,770,500)
2004
Company
2005
1,030,000,000
Less: Yield to maturity
Proceeds from issue
Group
BAMTN
2004
2005
2004
Less: Debt issuance
expenses *
Net proceeds
(5,820,539)
994,408,961
Accreted finance cost
730,910
995,139,871
*
-
(4,552,312)
- 1,004,914,995
(4,552,312)
(5,848,665)
1,004,914,995
170,245,085
170,245,085
176,093,750
7,781,378
7,646,667
105,440,000
72,248,334
103,802,628
71,126,393
- 1,012,696,373
1,012,561,662
275,685,085
242,493,419
279,896,378
247,220,143
-
Included in the debt issuance expenses are reporting accountants fees incurred as disclosed in Note 7.
All the borrowings carry fixed interest rates except for the MCPs and revolving credit.
(i)
Government Support Loan
The Government Support Loan which was obtained from the Federal Government in 1998 to finance the construction of the Wangsa
Maju Water Treatment Plant and its related facilities, is repayable in equal annual instalments over a period of twenty (20) years
commencing on 11 April 1999. It is secured on all money standing to the credit of the Special Project Account. The interest rate is
fixed at 3% (2004: 3%) per annum on the outstanding balance of the loan amount.
On 11 April 2004, the Federal Government restructured the Government Support Loan by reducing the interest rate to 3% per
annum retrospectively and accordingly revised the repayment schedule of the loan.
(ii) DSS II Term Loan
The Term Loan to finance the DSS II project is repayable in five (5) unequal instalments commencing on 31 October 2001 and
thereafter annually beginning on 2 January 2003. The Term Loan is secured via the assignments of DSS II construction contract and
project account, proceeds from the DSS II project and the designated account, contractors' performance bond and insurance
policies on the DSS II project. Interest is payable semi-annually and fixed at 7.6% (2004: 7.6%) per annum.
(iii) BAIDS/MCPs/MMTNs
On 12 October 2000, PNSB entered into several agreements with United Overseas Bank (Malaysia) Bhd and various parties to raise
RM1,020,000,000 10-Year BAIDS and RM350,000,000 MCPs/MMTNs Issuance Facility. Subsequently, on 28 October 2000, PNSB
issued the entire BAIDS and RM120,000,000 of the MCPs, the proceeds of which were utilised mainly to repay in full the Revolving
Underwriting Facility of RM800,000,000 and Term Loan of RM300,000,000.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 157
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
32. BORROWINGS (CONTD.)
(iii) BAIDS/MCPs/MMTNs (contd.)
The BAIDS primary bonds will mature beginning 27 October 2005 and on an annual basis, for each series issued. The non-detachable
BAIDS secondary bonds are redeemable semi-annually from the date the primary bonds were issued.
On 19 October 2005, the holders of the BAIDS approved the proposed extension of the BAIDS with the following variations to the
BAIDS:(i)
extension of the tenure of the BAIDS with a put and call option for redemptions attached, exercisable on the original maturity
dates of the BAIDS as follows:
(ii)
Series 1
- From 27 October 2005 to 27 October 2015
Series 2
- From 27 October 2006 to 27 October 2016
Series 3
- From 27 October 2007 to 27 October 2011
Series 4
- From 27 October 2008 to 27 October 2012
Series 5
- From 27 October 2009 to 27 October 2013
Series 6
- From 27 October 2010 to 27 October 2014
revision of the profit payment in respect of the BAIDS for the extended tenures.
(iii) allowing PNSB to apply monies in the DSRA for undertaking certain forms of permitted investments.
PNSB has obtained the approval from the Securities Commission on 19 December 2005 to revise the tenure of the BAIDS.
The MCPs/MMTNs were fully repaid in January and April 2005 respectively. The tender rates ranged between 2.79% and 2.81%
(2004: 2.76% and 3.00%) per annum during the financial year.
On 2 November 2005, PNSB obtained approval from the Securities Commission on the extension of the tenure and availability
period of the RM350,000,000 MCPs/MMTNs Issuance Facility. Pursuant to the Securities Commission's approval, the tenure and
availability period of the MCPs/MMTNs has been extended from five (5) to seven (7) years, expiring on 11 October 2007.
The facilities for the BAIDS and MMTNs are secured by way of deposit of an aggregate sum in the DSRA equivalent to twelve (12)
months projected payment obligations under the BAIDS and MMTNs that are outstanding at any point in time. PNSB is not entitled
to withdraw any money from the DSRA without prior consent from the Security Trustee except on condition that the BAIDS and
MMTNs have been fully redeemed. In addition, the facilities are also secured by fixed charges over all assets of PNSB, the rights of
PNSB under the Concession Agreements, construction contracts and project agreements undertaken by PNSB.
No dividend will be declared and paid by PNSB where inter-alia:
(a)
the outstanding balance in the DSRA is less than 1.0 time of the aggregate quantum of the Issuer's payment obligations under
the BAIDS and MMTNs for a period of twelve (12) months commencing from the date on which the dividend is contemplated;
or
(b) the Annual Debt Service Cover Ratio and the Forward Debt Service Cover Ratio are less than 1.7 times.
158
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
32. BORROWINGS (CONTD.)
(iii) BAIDS/MCPs/MMTNs (contd.)
PNSB will also be required to maintain the following financial ratios, which will be measured annually commencing on 31 December
2001:
(i)
Interest Cover Ratio of at least 2.0 times;
(ii)
Debt Equity Ratio of not more than 4.0 times; and
(iii) Annual Debt Service Cover Ratio of at least 1.25 times.
(iv) RUN
On 20 November 2001, the Company issued RM546,875,000 Nominal Value 15-Year RUN with 109,374,869 free detachable warrants
at an issue price of RM0.322 per RM1.00 nominal value of RUN on the basis of RM5.00 nominal value of RUN with one (1) free
warrant for every four (4) existing ordinary shares of RM1.00 each held in the Company. The RUN was offered to the entitled
shareholders and is constituted by a Trust Deed dated 5 September 2001. The RM176,000,000 proceeds from RUN issue was
immediately utilised to subscribe for the JNA issued by PNSB. PNSB subsequently, utilised the proceeds to repay RM168,000,000 of
its MCPs with the remaining balance utilised for its working capital purposes.
The main features of the RUN and the warrants are as follows:
(a)
The RUN carries a coupon rate of 2.5% per annum payable semi-annually for the immediate ten (10) years from the date of the
issue of the RUN and 3.5% per annum payable semi-annually thereafter for the next five (5) years.
(b) The Company shall redeem the RUN in ten (10) equal instalments each comprising 10% of the aggregate nominal value of all
outstanding RUN commencing on the sixth (6th) anniversary of the date of issue of the RUN. On the tenth (10th) anniversary
of the date of issue of the RUN, the Company has the option to redeem the RUN by paying the principal amount outstanding
on that date. On the same day, the holders of the RUN also have the option to sell the RUN back to the Company for a
consideration equivalent to the principal amount outstanding on that day.
(c)
The RUN and the warrants are transferable and are quoted on the Bursa Malaysia Securities Berhad.
(d) The RUN is secured on the JNA issued by PNSB. The Company is required to create a security account to receive only proceeds
from coupon payment and redemption of the JNA by PNSB, and thereafter to pay the coupon payment and redemption of the
RUN.
(e)
Holders of the warrants have the right to subscribe for new ordinary shares of the Company in cash at any time during the
period commencing one (1) day after the date of issue of the warrants and ending on the date being five (5) years from the
date of the issue of the warrants ("exercise period"). The exercise price of the warrants is RM2.62 per new ordinary share of
the Company subject to adjustments under certain circumstances in accordance with the provisions of the Deed Poll dated 5
September 2001.
(f)
(g)
The warrants that are not exercised during the exercise period will lapse and become void thereafter.
The new ordinary shares issued arising from the exercise of the warrants during the exercise period shall rank pari-passu in
all respects with the then existing ordinary shares of the Company except that they shall not be entitled to any dividends,
rights, allotments and/or distributions, the entitlement date of which is prior to the date of allotment of the said new ordinary
shares.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 159
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
32. BORROWINGS (CONTD.)
(iv) RUN (contd.)
The Company is restricted from declaring and paying any dividends:
(i)
if there is any amount due but not paid under the RUN; or
(ii)
in the event a default has occurred or is continuing and has not been waived.
(v) BACP Programme/BAMTN Programme
On 19 September 2005, SYABAS entered into several agreements with a consortium of banks comprising BIMB, BCB, CIMB and
HSBC in respect of the issue up to RM200 million nominal value BACP Programme and up to RM3 billion nominal value BAMTN
Programme.
On 30 September 2005, SYABAS completed the first issuance of the BAMTN with an aggregate nominal value of RM1.03 billion
comprising:
(i)
An eight-year RM310 million nominal value tranche;
(ii)
A nine-year RM200 million nominal value tranche;
(iii)
A ten-year RM200 million nominal value tranche; and
(iv) An eleven-year RM320 million nominal value tranche.
The BAMTN will mature beginning 30 September 2013 and on an annual basis, for each tranche issued.
SYABAS is required to maintain the following financial ratios:
(i)
Debt to Equity Ratio of not more than 75:25 from 2005 to 2008, both years inclusive and not more than 70:30 from and
including 2009 until the expiry of the BAMTN Programme; and
(ii)
Finance Service Cover Ratio of not less than 1.25 times from 2005 to 2008, both years inclusive and not less than 1.50 times
from and including 2009 until the expiry of the BAMTN Programme.
BACP/BAMTN are sharing the same securities as listed in Note 32 (vi). In addition, the BACP/BAMTN are also secured by way of the
rights over the Escrow Account and the monies standing to the credit thereof.
SYABAS is restricted from declaring and paying any dividends:
(i)
(ii)
if there is any amount due but not paid under the BAMTN; or
an Event of Default has occurred, is continuing and has not been waived, or if following such payment or distribution an Event
of Default would occur; or
(iii) the Finance Service Cover Ratio is breached or will be breached if calculated immediately following such payment or
distribution; or
160
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
32. BORROWINGS (CONTD.)
(v) BACP Programme/BAMTN Programme (contd.)
(iv) the Debt to Equity Ratio is breached or will be breached if calculated immediately following such payment or distribution; or
(v)
the balance outstanding to the credit of the Debt Service Reserve Account both before and after the payment is less than the
Minimum Required Balance;
provided that conditions (iii) and (v) shall not be applicable to dividends paid on RPS from year 2015 onwards.
(vi) 410 million and RM250 million Term Loans
SYABAS obtained Term Loan facilities of up to RM410 million and RM250 million from BPMB to part finance the capital expenditure
and the Non Revenue Water reduction programmes (including the operation, maintenance, development and upgrading of the
water distribution system over a period of 30 years) respectively.
These Term Loan are repayable as follows from the date of the first drawndown:
RM410 million
RM250 million
Term Loan
Term Loan
RM
RM
Month 204
73,240,000
50,000,000
Month 216
77,380,000
50,000,000
Month 228
81,750,000
50,000,000
Month 240
86,370,000
50,000,000
Month 252
91,260,000
50,000,000
410,000,000
250,000,000
The above Term Loans are secured via the following:
- A debenture incorporating fixed and floating charges over all present and future assets of SYABAS, both movable and immovable;
- Assignment of all rights, titles and benefits under the Concession Agreement;
- Assignment of all contractual rights, titles and benefits under the Construction Contract (excluding the performance bonds); and
- Assignment over the Designated Accounts (Collection Account, Operating Account, BPMB Disbursement Account, DSRA and Land
Use Charges Reserve Account).
Interest is payable annually at the rate of 5.65% per annum.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 161
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
32. BORROWINGS (CONTD.)
(vii) Effective Interest Rates
The effective interest rates per annum applicable to the borrowings at the balance sheet date were as follows:
Effective interest rate
per annum
2005
2004
%
%
Government Support Loan
3.00
3.00
DSS II Term Loan
7.60
7.60
Group
BAIDS
5.00 - 8.00
7.00 - 8.00
MCPs/MMTNs
2.79 - 2.81
2.76 - 3.00
RUN
BAMTN
RM410 million and RM250 million Term Loans
16.93
16.93
5.00 - 6.00
-
5.65
-
16.93
16.93
Company
RUN
33. LONG-TERM PAYABLES
(a)
Pursuant to the terms of the Deed entered into by PNSB and CGE, the Operation and Maintenance Sub-Contractor to MSSB, the
settlement of the amount owing by PNSB to MSSB is to be made over a period of thirty (30) months commencing October 2003.
The amount payable at the end of the financial year are as follows:
Group
2005
2004
RM
RM
38,131,931
57,362,080
-
37,843,562
38,131,931
95,205,642
Amount payable within 12 months
(included in trade payables - Note 30 (a))
Amount payable after 12 months
The long-term payables are unsecured, interest free and are not repayable within the next twelve (12) months.
(b) Pursuant to the Supplemental Agreement to the Government Support Loan Agreement, the amount of interest payable as at 11
April 2004 is to be made over a period of one hundred and forty four (144) months commencing April 2005. The amount payable at
the end of the financial year are as follows:
Group
2005
2004
RM
RM
Amount payable within 12 months
(included in finance cost payable - Note 30 (b))
Amount payable after 12 months
162
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
1,632,433
1,632,433
17,956,767
19,589,200
19,589,200
21,221,633
34. DEFERRED TAXATION
The components and movements of deferred tax assets and liabilities during the financial year prior to offsetting are as follows:
Consolidated Balance Sheet
Consolidated Income Statement
2005
2004
2005
2004
RM
RM
RM
RM
(9,732,596)
Deferred tax assets
Capital allowances
Tax losses
Other payables
(14,796,306)
(80,466,899)
65,670,593
(163,298,437)
(68,929,316)
(94,369,121)
-
(1,762,232)
-
(1,762,232)
-
Quoted investments
-
-
-
128,542
(179,856,975)
(149,396,215)
(30,460,760)
(9,604,054)
Property, plant and equipment
350,357,889
351,266,797
(908,908)
21,656,637
Project development expenditure
156,428,259
69,100,474
87,327,785
300,445
94,249
206,196
(29,249)
507,086,593
420,461,520
86,625,073
24,473,512
327,229,618
271,065,305
56,164,313
14,869,458
Deferred tax liabilities
Interest receivable
Deferred tax liabilities
2,846,124
Deferred tax assets are recognised for tax losses carried forward to the extent that the realisation of the related tax benefit through the
future taxable profits is available. The Directors are of the opinion that the Group will be able to reduce tax payable in view of future
profits and benefits accruing to the Group from the existing water concessions which have been awarded to the Group (Note 3) to which
the deferred tax assets relates. The tax losses have no expiry date.
Deferred tax assets have not been recognised as follows:
Group
Deductible temporary differences
Tax losses and capital allowances
Company
2005
2004
2005
RM
RM
RM
2004
RM
5,600
5,600
5,600
5,600
695,776
694,938
127,822
127,822
701,376
700,538
133,422
133,422
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 163
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
35. SHARE CAPITAL
Number of Ordinary
Shares of RM1.00 each
2005
Amount
2004
2005
2004
RM
RM
Authorised:
At 1 January/31 December
1,000,000,000
1,000,000,000
1,000,000,000
1,000,000,000
459,935,000
451,166,000
459,935,000
451,166,000
Issued during the financial year pursuant to ESOS
1,745,000
8,769,000
1,745,000
8,769,000
Conversion of warrants
1,500,000
-
1,500,000
-
463,180,000
459,935,000
463,180,000
459,935,000
Issued and fully-paid:
At 1 January
At 31 December
(a) Ordinary Shares Issued for Cash
During the financial year, the Company increased its issued and fully paid-up ordinary share capital from RM459,935,000 to
RM463,180,000 by way of:
(i)
issuance of 1,745,000 ordinary shares of RM1.00 each for cash pursuant to the Company's ESOS at exercise prices of between
RM2.04 and RM2.71 per ordinary share. These new ordinary shares issued during the financial year rank pari-passu in all
respects with the existing ordinary shares of the Company.
(ii)
issuance of 1,500,000 ordinary shares of RM1.00 at RM2.62 per share arising from the conversion of 1,500,000 units of
Warrants (Expiry date: 20 November 2006). These shares rank pari-passu in all respects with the existing ordinary shares of
the Company except that they shall not be entitled to the final dividend for the year ended 31 December 2004 which was paid
by the Company on 8 August 2005.
(b) ESOS
The ESOS of the Company, governed by the ESOS Bye-Laws, was principally approved by the shareholders of the Company at the
Extraordinary General Meeting of the Company held on 26 June 2001 and became effective following the implementation by the
Company on 25 February 2002. The ESOS shall be in force for a duration of five (5) years commencing from 25 February 2002.
The salient features of the ESOS are as follows:
(i)
The ESOS is set up for the participation in ordinary shares of the Company only. The maximum number of new ordinary shares
which may be made available under the ESOS shall not exceed 10% of the total issued and paid-up ordinary shares of the
Company at the point in time when an offer is made.
(ii)
Eligible employees are those who have been in service of the Group for a continuous period of at least one (1) year including
full-time Executive Directors who are involved in the day-to-day management and on the payroll of the Group.
164
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
35. SHARE CAPITAL (CONTD.)
(b) ESOS (contd.)
(iii) The ESOS is administered by the Options Committee which comprise the following Executive Directors of the Company:
(a)
Tan Sri Rozali bin Ismail
(b) Ruslan bin Hassan
(Ceased as a member on 1 October 2005)
(c)
(Ceased as a member on 1 October 2005)
Lee Miang Koi
(d) Tan Seng Lee
(Appointed on 1 September 2005)
(e)
Matlasa bin Hitam
(Appointed on 1 October 2005)
(f)
Syed Danial bin Syed Ariffin
(Appointed on 1 October 2005)
(iv) The share options granted under the ESOS may be exercised by the grantee by notice in writing to the Company during the
period commencing from the date of offer and before the expiry of the ESOS on 24 February 2007.
(v)
The exercise price of the share options at which the eligible employees are entitled to subscribe for the ordinary shares of
RM1.00 each in the Company under the ESOS is the weighted average market price of the shares of the Company as quoted
in the daily official list issued by the Bursa Malaysia Securities Berhad for the five (5) market days immediately preceding the
respective dates of offer subject to a discount of not more than 10%, or at the par value of the ordinary shares of the Company
of RM1.00 each, whichever is higher.
(vi) The eligible employees to whom the share options have been granted has no right to participate, by virtue of the share options,
in any share issue of any other company within the Group.
(vii) The new ordinary shares issued arising from the ESOS shall rank pari-passu in all respects with the then existing ordinary
shares of the Company except that they shall not be entitled to any dividends, rights, allotments and/or other distributions, the
entitlement date of which is prior to the date of allotment of the said new ordinary shares.
(viii) The basis on which the share options may be exercised, up to the expiry of the ESOS on 24 February 2007, in accordance with
the Directors' approval is as follows:
Number of share
options granted and
unexercised as at
Tranche
31 December 2005
Percentage of share options exercisable
2006
2007
%
%
1
9,177,000
100
100
2
430,000
100
100
3
638,000
100
100
4
623,000
100
100
5
785,000
100
100
6
414,000
100
100
7
2,733,000
100
100
8
1,351,000
100
100
16,151,000
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 165
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
35. SHARE CAPITAL (CONTD.)
(b) ESOS (contd.)
The movements of the share options over the ordinary shares of RM1.00 each of the Company granted under the ESOS during the
financial year are as follows:
Tranche
Date of
Exercise
share option
price per
Number of Share Options over Ordinary Shares of RM1.00 Each
At
granted share option
1 January
Granted
At
Exercise
Lapsed * 31 December
RM
2005
1
26.2.2002
2.37
11,537,000
-
(1,076,000)
(1,284,000)
9,177,000
2
26.8.2002
2.47
676,000
3
26.2.2003
2.13
947,000
-
(51,000)
(195,000)
430,000
-
(270,000)
(39,000)
4
26.8.2003
2.71
638,000
776,000
-
(15,000)
(138,000)
5
26.2.2004
623,000
3.27
995,000
-
(210,000)
785,000
6
7
26.8.2004
2.04
751,000
-
(323,000)
(14,000)
414,000
26.2.2005
2.56
-
3,041,000
(3,000)
(305,000)
2,733,000
8
26.8.2005
2.40
-
1,351,000
15,682,000
4,392,000
(1,738,000)
-
-
-
1,351,000
(2,185,000)
16,151,000
2004
*
166
1
26.2.2002
2.37
19,215,000
-
(6,955,000)
(723,000)
11,537,000
2
26.8.2002
2.47
1,211,000
-
(432,000)
(103,000)
676,000
3
26.2.2003
2.13
1,957,000
-
(798,000)
(212,000)
947,000
4
26.8.2003
2.71
1,172,000
-
(371,000)
(25,000)
776,000
5
26.2.2004
3.27
-
1,635,000
-
(640,000)
995,000
6
26.8.2004
2.04
-
979,000
(213,000)
(15,000)
751,000
23,555,000
2,614,000
(8,769,000)
(1,718,000)
15,682,000
Due to resignation or offers not taken up
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
35. SHARE CAPITAL (CONTD.)
(b) ESOS (contd.)
Number of share options vested at balance sheet date:
2005
2004
At 1 January
2,657,000
1,925,000
At 31 December
9,312,000
2,657,000
Details of share options exercised during the financial year and the fair value, at the exercise date, of ordinary shares issued are as
follows:
Exercise date
January 2004
Fair value of
Exercise price
shares at
per share
exercise date
option
RM
RM
Number of shares issued
2005
2004
105,000
3.50
2.13 - 2.71
-
February 2004
3.50 - 3.58
2.13 - 2.71
-
531,000
March 2004
3.68 - 3.70
2.13 - 2.71
-
4,538,000
April 2004
3.54 - 3.62
2.13 - 2.71
-
1,445,000
May 2004
2.94 - 3.36
2.13 - 2.71
-
683,000
June 2004
2.55
2.13
-
5,000
July 2004
2.60
2.13 - 2.37
-
31,000
September 2004
2.35 - 2.50
2.13 - 2.37
-
26,000
October 2004
2.47 - 2.50
2.04 - 2.13
-
22,000
2.80
2.04 - 2.13
-
100,000
November 2004
December 2004
2.89 - 3.12
2.04 - 2.71
-
1,283,000
January 2005
2.97 - 3.10
2.04 - 2.71
526,000
-
February 2005
2.96
2.04 - 2.37
63,000
-
2.53 - 2.72
2.04 - 2.37
333,000
-
April 2005
2.64
2.04 - 2.37
9,000
-
May 2005
2.66 - 2.79
2.04 - 2.56
257,000
-
June 2005
March 2005
2.49 - 2.60
2.13 - 2.37
35,000
-
July 2005
2.77
2.13 - 2.47
21,000
-
August 2005
2.28
2.04 - 2.37
25,000
September 2005
2.30 - 2.50
2.04 - 2.37
106,000
-
October 2005
2.70 - 2.75
2.04 - 2.47
247,000
-
2.49
2.04 - 2.47
123,000
-
1,745,000
8,769,000
November 2005
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 167
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
35. SHARE CAPITAL (CONTD.)
(b) ESOS (contd.)
The additions to the share capital and share premium relating to share options exercised during the financial year are as follows:
2005
2004
RM
RM
Ordinary share capital - at par
1,745,000
8,769,000
Share premium
2,230,730
11,921,060
Proceeds received on exercise of share options
3,975,730
20,690,060
Fair value at exercise date of share issue
4,807,500
30,881,520
The fair value of shares issued on the exercise of share options is the closing market price at which the Company's shares were
traded on the Bursa Malaysia Securities Berhad on the day of exercise of the share options.
(c) Treasury Shares
On 28 June 2005, the shareholders of the Company at the Extraordinary General Meeting of the Company approved the Company's
proposal to repurchase its own shares of up to 10% of its issued and paid-up share capital. The Directors of the Company are
committed to enhance the value of the Company for its shareholders and believe that the repurchase proposal can be applied in
the best interests of the Company and its shareholders.
As at 31 December 2005, the Company had purchased a total of 5,808,800 ordinary shares of its issued and fully paid-up share
capital from the open market for a total consideration of RM15,057,236 at an average cost of RM2.59 per share. The acquisition of
shares was financed by internally generated funds.
Of the total 463,180,000 (2004: 459,935,000) issued and paid-up ordinary shares as at 31 December 2005, 5,808,800 (2004: Nil) are
held as treasury shares by the Company. As at 31 December 2005, the number of outstanding ordinary shares in issue and fully
paid is therefore 457,371,200 (2004: 459,935,000) ordinary shares of RM1.00 each.
36. RETAINED EARNINGS
The Company has sufficient tax credit under Section 108 of the Income Tax Act, 1967 to frank the payment of dividends out of its entire
retained earnings as at 31 December 2005, without incurring additional tax liabilities.
37. GOVERNMENT GRANT
The government grant of RM3,102,907 (2004: RM Nil) was received by SYABAS in consideration of SYABAS performing its obligations
under the Concession Agreement. This grant is used solely for the purpose of financing the cost and expenditure of the NRW. NRW refers
to such part of the works undertaken by SYABAS for the purposes of reducing non-income generating unaccountable water loss, and
the cost and expenditure of which will be paid for from the grant.
168
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
38. NET CASH GENERATED FROM OPERATIONS
Group
Net profit for the financial year
Company
2005
2004
2005
RM
RM
RM
2004
RM
99,259,577
46,439,269
15,465,604
1,487,724
Adjustments for:
Depreciation of property, plant and equipment
10,320,398
4,488,915
88,045
88,045
226,424,285
14,987,477
-
-
8,700,561
82,248,362
-
-
Accretion of finance cost
34,057,287
29,965,001
32,676,235
27,478,228
Interest on hire-purchase
524,154
363,282
-
-
-
23,248,049
-
-
135,483
111,726,120
-
-
(116,642)
-
-
Amortisation of project development expenditure
Amortisation of concession assets
Discounts given to customer
Debts written off
Gain on disposal of property, plant and equipment
(247,001)
Goodwill written off
-
3,000
-
-
Loss on disposal of quoted shares
-
352
-
-
-
-
2,022,770
-
Allowance for diminution in value of investment
in jointly controlled entity
Allowance for doubtful debts
Taxation
5,074,636
-
-
-
58,307,844
30,679,954
7,627,494
816,248
64,742
-
-
-
4,488,185
-
-
-
-
Share of results of
- associate
- jointly controlled entity
(1,969,777)
Minority interest
39,277,982
Interest income
(24,363,907)
(10,654,708)
(46,914,903)
(42,934,537)
-
Interest expense
108,679,162
67,633,500
14,225,135
15,456,309
374,528,282
119,310,426
(10,547,282)
Changes in working capital:
- Receivables
- Payables
Net cash generated from operations
(500,662,497)
438,111,211
603,572
5,207,411
2,734,535
(1,830,643)
530,017,953
17,377,633
1,164,946
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 169
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
39. SIGNIFICANT RELATED PARTY TRANSACTIONS AND BALANCES
Significant related party transactions
The related party transactions undertaken in the normal course of business are on terms and prices agreed with the respective related
parties.
The significant related party transactions during the financial year are as follows:
Group
2005
Operating and maintenance charges by MSSB
Management fees charged by MSSB
Secretarial fees charged by RZ Management Services Sdn Bhd
2004
RM
RM
-
71,015,765
-
500,004
240,000
240,000
Related party balances
Related party balances which arose from the above significant related party transactions and remained outstanding at the balance sheet
date are as follows:
Group
Related party payable
Type of transaction
MSSB
Operating and maintenance charges
RZ Management Services Sdn Bhd
Secretarial fees
2005
2004
RM
RM
-
45,028,038
21,000
21,000
21,000
45,049,038
CPMSB is a substantial shareholder of the Company. Tan Sri Rozali bin Ismail, a Director of the Company is also the Director of CPMSB.
Related parties
Relationship
MSSB
A subsidiary of CPMSB
RZ Management Services Sdn Bhd
A Director related corporation
40. COMMITMENTS
Group
2005
2004
RM
RM
-
2,599,475
218,363,462
274,274,084
- Annual charges
2,283,000,000
-
- Land use charges
2,526,790,000
-
29,000,000
-
449,933,904
-
5,288,723,904
-
Commitment under the terms of the PCCA
dated 22 September 1994 for the rehabilitation
and refurbishment of water treatment facilities.
Contracts approved and contracted for
Commitment under the terms of the Concession Agreement:
- Concession fees
- Contracts approved and contracted for
170
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
41. NON-CANCELLABLE OPERATING LEASE COMMITMENTS
Group
2005
Payable within one year
Payable between one and five years
2004
RM
RM
2,749,220
1,942,271
503,034
196,156
3,252,254
2,138,427
42. CONTINGENT LIABILITIES
Group
Company
2005
2004
2005
2004
RM
RM
RM
RM
-
-
50,000,000
50,000,000
-
32,600,000
-
32,600,000
26,539,231
24,543,771
-
-
Unsecured:
Corporate guarantee given to a bank
for facilities granted to a subsidiary
Financial guarantee given to a bank for
facilities granted to a jointly controlled entity
Trade and performance guarantees
extended to third party
43. SEGMENTAL REPORTING
Segmental analysis is not presented as the Group is primarily involved in the operation, maintenance, construction, rehabilitation and
refurbishment of water treatment facilities and the supply and distribution of treated water to consumers in the Distribution Area. The
Group operates principally in Malaysia.
44. FINANCIAL INSTRUMENTS
Financial instruments are contracts that give rise to both a financial asset of one enterprise and a financial liability or equity instrument
of another enterprise. These include, amongst others, investments, deposits, cash and bank balances, receivables, payables and
borrowings.
Fair values
The carrying amounts of other financial assets and financial liabilities of the Group and of the Company at the balance sheet date
approximated their fair values except as set below:
Puncak Niaga Holdings Berhad
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31 December 2005
44. FINANCIAL INSTRUMENTS (CONTD.)
Group
Note
Carrying amount
Fair value
RM
RM
518,566,000
380,300,034
At 31 December 2005
Financial asset
Long-term receivables
22
Financial liabilities
Hire-purchase payables
31
(8,684,003)
(9,413,711)
Borrowings:
- Government Support Loan
32
(85,899,231)
(77,925,372)
- BAIDS
32
(1,012,696,373)
(1,121,121,310)
- RUN
32
(275,685,085)
(406,519,966)
33(b)
(19,589,200)
(14,740,862)
Long-term payables
Company
Note
Carrying amount
Fair value
RM
RM
Financial assets
Junior Notes A
19
279,896,378
406,519,966
Advances to a subsidiary
20
343,368,807
305,253,262
Group
Note
Carrying amount
Fair value
RM
RM
22
518,566,000
298,682,935
31
(4,445,180)
(4,555,548)
32
(121,775,579)
(95,984,328)
At 31 December 2004
Financial asset
Long-term receivables
Financial liabilities
Hire-purchase payables
Borrowings:
- Government Support Loan
- DSS II Term Loan
32
(62,805,674)
(60,701,055)
- BAIDS
32
(1,012,561,662)
(1,142,428,720)
32
(242,493,419)
(383,235,481)
33(a) & (b)
(116,427,275)
(102,448,813)
- RUN
Long-term payables
Company
Note
Carrying amount
Fair value
RM
RM
At 31 December 2004
Financial assets
172
Junior Notes A
19
247,220,143
383,235,481
Advances to a subsidiary
20
361,368,807
305,526,037
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
44. FINANCIAL INSTRUMENTS (CONTD.)
It is not practical to estimate the fair value of contingent liabilities reliably due to the uncertainties of timing, costs and eventual
outcome.
The following methods and assumptions are used to estimate the fair values of the following classes of financial instruments:
(i)
Cash and Cash Equivalents, Trade and Other Receivables/Payables and Short-Term Borrowings
The carrying amounts approximate fair values due to the relatively short-term maturity of these financial instruments.
(ii) Long-Term Receivables
The fair values of long-term receivables are estimated by discounting the expected future cash flows using the prevailing market
interest rate.
(iii) Borrowings
The fair value of borrowings is estimated by discounting the expected future cash flows using the current interest rates for liabilities
with similar risk profiles.
45. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR
(a)
On 8 December 2004, SYABAS had agreed to acquire the entire paid-up share capital of PUAS from KDEB, the attorney for MENTERI
BESAR Incorporated (1994) for a cash consideration of RM2.00. The effective date of the acquisition coincides with the operational
date of the Concession Agreement dated 15 December 2004 between SYABAS, the Federal Government and the State Government,
which took effect on 1 January 2005.
(b) On 19 January 2005, PNSB, SYABAS and PUAS executed the following agreements in relation to the financing of the privatisation of
water supply services in the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya which had been awarded
to SYABAS ("the Privatisation"):(i)
RM410 million Term Loan Agreement entered into by SYABAS with BPMB. This facility will be utilised to part finance the capital
expenditure of SYABAS under the Privatisation which include the operation, maintenance, development and upgrading of the
water distribution system over a period of 30 years;
(ii)
RM250 million Term Loan Agreement entered into by SYABAS with BPMB. This facility will be utilised to part finance the Non
Revenue Water reduction programme under the Privatisation which include the operation, maintenance, development and
upgrading of the water distribution system over a period of 30 years;
(iii) Master BBA Facility Agreement and all related ancillary agreements in relation to the RM485 million Bai' Bithaman Ajil Facility
entered into by SYABAS with the following parties:- the Facility Agent, namely, CIMB; and
- the Joint Arrangers and Financiers, namely, BIMB, BCB, CIMB and HSBC.
(iv) Facility Agreement in relation to the RM15 million Al-Kafalah facility entered into between SYABAS and BCB.
Puncak Niaga Holdings Berhad
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31 December 2005
45. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR (CONTD.)
(v)
Security Agency Agreement entered into by SYABAS and PUAS with the following parties:- the Security Agent, namely, CIMB;
- BPMB; and
- BCB.
and all other security documents as required for the purposes of the financing arrangement as entered into between SYABAS
and the Security Agent, CIMB.
(vi) DSARA entered into by PNSB with the State Government. Pursuant to the terms of the DSARA, PNSB shall accept payment of
RM710.33 million ("Scheduled Amounts") by the State Government as full and final settlement of a total indebtedness of
RM787.65 million, which represents a portion of the debt due to PNSB by the State Government as at 31 December 2004. The
first tranche of the Scheduled Amounts amounting to RM427.2 million was paid on 25 October 2004. The balance of RM283.13
million was paid to PNSB on 25 January 2005.
(vii) Novation Agreement entered into by PNSB with the State Government and Tekal Tiasa. Under the Novation Agreement, the
State Government requests Tekal Tiasa to assume and take over the State Government's obligations to pay the balance of
Scheduled Amounts of RM283.13 million to PNSB. PNSB has agreed to accept payment in cash by Tekal Tiasa amounting to
RM272.14 million as full and final satisfaction of the balance of the Scheduled Amounts of RM283.13 million.
(c)
On 3 February 2005, PNSB and SYABAS executed the following ancillary agreements to facilitate the Privatisation, namely:
(i)
Novation Agreement between PNSB, the State Government and Serba Tiara. Pursuant to this Novation Agreement, Serba Tiara
shall assume and take over the State Government's obligations to pay to PNSB RM518.566 million.
In consideration of Serba Tiara agreeing to assume and take over the State Government's obligations to settle the outstanding
payments due to PNSB, the State Government will give irrevocable instructions to SYABAS for the payments to Serba Tiara the
aggregate amount of RM1.033 billion comprising the payments to be made by SYABAS to the State Government in respect of
the Annual Charges for the Concession Years 2006 to 2015.
(ii)
Novation Agreement between SYABAS, the State Government and SPLASH. SYABAS shall assume and take over the State
Government's obligation in relation to the following:
- purchase and payment of treated water;
- the quality of treated water; and
- all operational matters relating to such purchase, payment and quality of treated water as contained in the Privatisation
Agreement and Supplemental Agreement, both dated 24 January 2000 made between the State Government and SPLASH.
174
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
45. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR (CONTD.)
(d) On 15 February 2005, SYABAS entered into a Novation Agreement with the State Government and ABASS, whereby, SYABAS shall
assume and take over the State Government's obligations in relation to the following:
- purchase and payment of treated water;
- the quality of treated water; and
- all operational matters relating to such purchase, payment and quality of treated water as contained in the PCCA dated
9 December 2000 and as amended by the First Supplemental Agreement dated 10 February 2001, Second Supplemental
Agreement dated 28 August 2001 and Third Supplemental Agreement dated 15 February 2005.
(e)
On 18 February 2005, PNSB entered into a SPA with Timor Marine Sdn Bhd to acquire a property in Shah Alam comprising two (2)
pieces of leasehold land together with a fifteen (15) storey office building known as Wisma Rozali (formerly known as Wisma
Maritim) for a cash consideration of RM39 million. The leasehold period is ninety-nine (99) years expiring on 22 January 2102.
The approval of the Foreign Investment Committee was obtained on 16 March 2005. On 6 July 2005, the Company obtained the
approval from the Pejabat Daerah/Tanah Petaling, approving the transfer of the property to PNSB.
(f)
On 13 April 2005, the Company announced that:
(i)
The Company intends to seek shareholders' approval for a proposed purchase by the Company of its own shares of up to 10%
of its issued and paid-up share capital ("Proposed Share Buy Back") at any time, on Bursa Malaysia Securities Berhad; and
(ii)
The Company on behalf of CPMSB and persons acting in concert intends to seek exemption from the obligation to undertake
a MGO for the remaining shares in the Company not already owned by them subsequent to the implementation of the
Proposed Share Buy Back, as permitted under Practice Note 2.9.10 of the Malaysian Code On Take-Overs And Mergers 1998
("Proposed MGO Exemption").
The Proposed Share Buy Back was approved by the shareholders at the Extraordinary General Meeting of the Company on 28 June
2005.
The Securities Commission via its letter dated 28 July 2005 approved the Proposed MGO Exemption, subject to the condition that
CPMSB and persons acting in concert must at all times disclose to the Securities Commission all acquisitions or purchases of the
voting shares of the Company made by them in a twelve (12) month period from the date of the granting of the said exemption.
(g)
On 6 May 2005, SYABAS entered into Subscription Agreement with the MOF in relation to the subscription of the RM655 million
RPS to be issued by SYABAS at a total subscription price of RM655 million. MOF has agreed to subscribe for a total of RM655 million
RPS of RM0.01 each in SYABAS, to be issued at an issue price of RM1.00 per RPS (a premium of RM0.99 per RPS) within a period of
four (4) years, commencing from year 2007 until 2011. The RPS is not convertible into ordinary shares of SYABAS but may be
redeemed by SYABAS commencing on 31 December 2021 until 31 December 2025 in five (5) equal tranches of RM131 million for
each of the years.
(h) On 8 September 2005, the Securities Commission approved the proposal to issue up to RM200 million nominal value BACP
Programme and up to RM3 billion nominal value BAMTN Programme by SYABAS ("Proposed BBA Programmes").
SYABAS had on 19 September 2005, entered into several agreements with a consortium of banks comprising BIMB, BCB, CIMB and
HSBC in respect of the Proposed BBA Programmes.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 175
n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
45. SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR (CONTD.)
On 30 September 2005, SYABAS completed the first issuance of the BAMTN pursuant to the Proposed BBA Programmes with an
aggregate nominal value of RM1.03 billion comprising:
(i)
An eight-year RM310 million nominal value tranche;
(ii)
A nine-year RM200 million nominal value tranche;
(iii) A ten-year RM200 million nominal value tranche; and
(iv) An eleven-year RM320 million nominal value tranche.
(i)
On 16 September 2005, the Company entered into a MOU with WWE Holdings Berhad to facilitate both companies' joint
participation in water, waste water and other related environmental projects in the Kingdom of Saudi Arabia. Upon execution, the
MOU shall remain valid for a period of twelve (12) months, except as otherwise mutually agreed in writing by both parties.
(j)
On 19 October 2005, the holders of the PNSB BAIDS approved the proposed extension of the BAIDS with the following variations
to the BAIDS:
(i)
extension of the tenure of the BAIDS with a put and call option for redemptions attached, exercisable on the original maturity
dates of the BAIDS.
(ii)
revision of the profit payment in respect of the BAIDS for the extended tenures.
(iii) allowing PNSB to apply monies in the DSRA for undertaking certain forms of permitted investments.
PNSB has obtained the approval from the Securities Commission on 19 December 2005 to revise the tenure of the BAIDS.
On 28 December 2005, PNSB executed all the relevant agreements to effect the revision of the terms and conditions of the BAIDS.
(k)
On 2 November 2005, PNSB obtained approval from the Securities Commission on the extension of the tenure and availability
period of the RM350,000,000 MCPs/MMTNs Issuance Facility. Pursuant to the Securities Commission's approval, the tenure and
availability period of the MCPs/MMTNs has been extended from five (5) to seven (7) years, expiring on 11 October 2007.
PNSB had on 17 February 2006, executed the following agreements to effect the extension of the tenure of the MCPs/MMTNs
Programme:
(i)
a Supplemental Agreement relating to the MCPs/MMTNs Programme Agreement between PNSB, United Overseas Bank
(Malaysia) Bhd as arranger and programme agent, issuing agent, paying agent and calculation agent; and
(ii)
a Supplemental Trust Deed in relation to the MCPs/MMTNs between PNSB and PB Trustee Services Berhad.
46. SIGNIFICANT EVENTS SUBSEQUENT TO THE BALANCE SHEET DATE
(a)
On 23 February 2006, the Company entered into a Subscription Agreement with SYABAS and KDEB in relation to the subscription
for up to RM1.045 billion nominal value of RCULS. The RCULS will be issued progressively to the Company and KDEB over the next
four (4) years by SYABAS from 2006 to 2009 to finance the operations and capital expenditure requirements of SYABAS under the
Concession Agreement dated 15 December 2004. The commitments by the Company and KDEB to subscribe for the RCULS are up
to RM731.5 million (70%) and RM313.5 million (30%) respectively.
176
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Puncak Niaga Holdings Berhad
46. SIGNIFICANT EVENTS SUBSEQUENT TO THE BALANCE SHEET DATE (CONTD.)
In the event that any party is unable to subscribe for its portion of the relevant RCULS in full on the issue date, the other party shall
thereupon be entitled, but not obliged to subscribe for all, or a portion only, of such RCULS as are unable to be subscribed for.
(b) On 22 March 2006, the Company incorporated a 70% owned subsidiary, Puncak Oil & Gas Sdn Bhd, with an authorised share capital
of RM50,000,000 divided into 50,000,000 ordinary shares of RM1.00 each and issued and paid-up share capital of RM100,000
divided into 100,000 ordinary shares of RM1.00 each.
The remaining 30% equity interest in Puncak Oil & Gas Sdn Bhd is owned by Damini Corporation Sdn Bhd.
47. MATERIAL LITIGATIONS
(a)
On 2 July 2003, Konajaya filed a suit against PUAS. PUAS called on a bank guarantee and demanded the bank (the issuer of the
guarantee) to pay PUAS a sum of RM4,895,160 being the amount of a bank guarantee associated to a contract. On 12 March 2004,
an inter-partes injunction was granted to Konajaya to stop the bank from honouring the bank guarantee.
PUAS had instructed counsel to appeal against the decision of the High Court and is pending a hearing date from the Court of
Appeal.
(b) Both SYABAS and PUAS had been served with the following writs from the solicitors acting for Premier Ayer in relation to the
Contract for Non-Revenue Water Reduction for the State of Selangor - Phase 2 Works ('the NRW Contract'):(i)
Premier Ayer had commenced legal action against PUAS, wherein the Writ of Summons and the Statement of Claim dated 23
June 2005 was served on PUAS's solicitors on 12 July 2005 for the following:- the sum of RM19,575,000;
- interest thereon at 8% per annum from 23 June 2005 until full realisation;
- costs; and
- such further and other relief as deemed fit by the High Court.
(ii)
Premier Ayer had filed a legal suit against PUAS and SYABAS, for an account and profits and damages from alleged
infringements of confidential information, copyright and for the tort of inducing a breach of contract.
Premier Ayer had on 1 August 2005, obtained an ex-parte injunction restraining PUAS and SYABAS from inter alia, using its
confidential information, infringing with its copyright, interfering with the performance of its contractual obligations and
terminating the NRW Contract.
PUAS and SYABAS deny the allegations made by Premier Ayer and had instructed its solicitors to initiate the necessary legal
recourse to set aside the injunction. The ex-parte application to set aside the injunction had been filed and heard on 12, 15,
17, 22 August 2005, 5 and 27 September 2005 respectively. At the hearing on 22 August 2005, the Judge allowed the ex-parte
injunction to be held over until the disposal of the inter-parte injunction. The hearing of the inter-parte injunction and the interparte setting aside application has been adjourned from 24 January 2006 to 30 May 2006 pending settlement negotiations
between the parties.
On 7 March 2006, the solicitors' of Premier Ayer filed the Notices of Discontinuance in respect of the abovementioned legal
suits. The parties reached an amicable out-of-court settlement with Premier Ayer.
Puncak Niaga Holdings Berhad
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n o t e s t o t h e f i n a n c i a l s tat e m e n t s
31 December 2005
47. MATERIAL LITIGATIONS (CONTD.)
(c)
KHEC, a sub-contractor for the Chennai Water Supply Augmentation Project 1 - Package III ('Chennai Project'), has referred certain
disputed claims totaling approximately RM7.5 million against PNHB-LANCO-KHEC JV ('the Consortium'), a jointly controlled entity in
India of the Company.
Arising from the arbitration proceedings initiated by KHEC, both KHEC and the Consortium have each appointed a qualified civil
engineer as their arbitrator respectively, and both arbitrators have selected a retired Judge of the High Court in Chennai, India as
the third arbitrator who will also act as the presiding arbitrator of the arbitral tribunal. The arbitral tribunal was officially constituted
on 24 September 2005. On 28 September 2005, the Company was informed that the arbitral tribunal has fixed the following dates
for the filing of the arbitration cause papers as part of the preliminary procedural formalities:(i)
claim by the claimant, KHEC to be filed before 4 October 2005;
(ii)
rejoinder by the respondent, the Consortium to be filed before 18 November 2005; and
(iii) reply rejoinder by the claimant, KHEC to be filed before 5 December 2005.
The Consortium had on 2 January 2006, filed its counter-claim amounting to Rs13,61,61,931 (equivalent to approximately
RM12.1 million) against KHEC's claim of Rs8,44,26,981 (equivalent to approximately RM7.5 million) to the arbitral tribunal in India.
Based on the facts and records available, the Consortium is of the view that the claim by KHEC is not sustainable.
(d) On 23 January 2006, SYABAS was served with an Originating Summons from the solicitors acting for ABASS in relation to the PCCA
whereby ABASS is seeking the following:(i)
a declaration that SYABAS pursuant to the PCCA is obliged to purchase treated water from ABASS at no less than Designated
Quantity on any given day;
(ii)
a declaration that in respect of the purchase of treated water at less than the Designated Quantity on any given day, SYABAS
is obliged to pay ABASS a sum representing the difference between the actual quantity of water supplied by ABASS and the
minimum Designated Quantity calculated on a daily basis;
(iii) a declaration that SYABAS is liable to pay ABASS the total sum of RM73,549,373.41 being the sum due pursuant to invoices
for the period from 31 December 2004 to 29 August 2005;
(iv) that judgement be entered for ABASS for the total sum of RM73,549,373.41;
(v)
further and/or in the alternative, SYABAS do pay ABASS general damages for breach of the PCCA; and
(vi) interests, costs and such further or other order as deemed fit by the Court.
SYABAS, on the advice of its solicitors, has taken the position that its computation of the sums payable under the PCCA in respect
of the relevant invoices for the periods concerned, which amount to RM72,914,107.82 and had been paid by SYABAS, were correct
and that no further sums are owing to ABASS, and has instructed its solicitors to defend the above claims.
The solicitors for SYABAS has filed the Memorandum of Appearance on 26 January 2006.
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Puncak Niaga Holdings Berhad
P R OX Y F O R M
I/We
(name of shareholder as per NRIC, in capital letters)
NRIC No./Company No.
(new)
(old)
of
being a Member/Members of Puncak Niaga Holdings Berhad hereby appoint
(name of proxy as per NRIC, in capital letters) NRIC No.
(new)
or failing him/her
NRIC No.
(old)
(name of proxy as per NRIC, in capital letters)
(new)
(old) or failing him/her, the Chairman of the Meeting
as my/our proxy to attend and vote for me/us and on my/our behalf at the Ninth Annual General Meeting of Puncak Niaga Holdings Berhad
to be held at the Banquet Hall, Kuala Lumpur Golf & Country Club, No. 10, Jalan 1/70D, Off Jalan Bukit Kiara, 60000 Kuala Lumpur on
Wednesday, 28 June 2006 at 9.30 a.m. and at any adjournment thereof, as indicated below:
No.
Resolution
1.
To receive the Audited Accounts of the Company for the financial year ended
For
Against
31 December 2005 and the Reports of the Directors and Auditors thereon.
2.
To declare a final dividend of 6 sen per share less 28% income tax in respect of the
financial year ended 31 December 2005 as recommended by the Directors of the Company.
3.
To re-elect Ir Lee Miang Koi as Director of the Company.
4.
To re-elect Yang Berbahagia Tan Sri Dato’ Hari Narayanan a/l Govindasamy as Director of
the Company.
5.
To re-elect Encik Matlasa Hitam as Director of the Company.
6.
To re-elect Mr Tan Seng Lee as Director of the Company.
7.
To re-appoint Messrs Ernst & Young as the Auditors of the Company and to authorise
the Directors of the Company to fix their remuneration.
8.
To empower the Directors of the Company to issue shares pursuant to Section 132D of
the Companies Act, 1965.
Please indicate with a cross (X) how you wish your votes to be cast in respect of each Resolution. In the absence of specific directions, your
proxy will vote or abstain as he thinks fit.
………………………………………………………...
Signature(s)/Common Seal of Shareholder(s)
No. of shares held: ……………....……..….....
NRIC / Company No: ………………………….....
Signed this …...… day of ……......….... 2006
Notes:
1.
A member entitled to attend and vote at the Meeting is entitled to appoint a proxy to attend and vote in his stead. A proxy need not be
a member of the Company.
2.
The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorised or if such appointer
is a corporation, it must be either under its seal or under the hand of an officer or attorney duly authorised.
3.
The instrument appointing the proxy must be deposited at the Registered Office of the Company at Suite 1701-1706, 17th Floor, Plaza
See Hoy Chan, Jalan Raja Chulan, 50200 Kuala Lumpur not less than 48 hours before the time set for holding the Meeting or any
adjournment thereof.
Puncak Niaga Holdings Berhad
A N N U A L R E P O R T 2 0 0 5 179
Please fold here
STAMP
Secretarial Department
Puncak Niaga Holdings Berhad (416087-U)
Suite 1701 - 1706, 17th Floor
Plaza See Hoy Chan
Jalan Raja Chulan
50200 Kuala Lumpur
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180
ANNUAL REPORT 2005
Puncak Niaga Holdings Berhad
HEALTH, SAFETY & ENVIRONMENTAL POLICY
It is the policy of Puncak Niaga Holdings Berhad and its subsidiaries (PNHB Group) to provide, so far as is practicable,
a safe, healthy and environment friendly workplace for all employees, contractors, visitors, interested members of
society and others, and in the spirit of consultation and cooperation, the Management and employees will together
strive to achieve the goals and objectives of this Policy.
Without prejudice to the generality of the above statement, the Policy of the PNHB Group is:
•
to provide and maintain a safe and environment friendly workplace and system of work and to continually
improve its environment and safety performance;
•
to continuously emphasise on the prevention of pollution in all activities;
•
to ensure environmental and safety objectives and targets are set and reviewed;
•
to ensure all employees are informed, instructed, trained and supervised on how to perform their job safely and
without risk to health and without any harm to the environment;
•
to investigate all accidents and near-misses and to take corrective measures to ensure the accidents or nearmisses will not recur;
•
to comply with all legal and other requirements on health, safety and environment and other good practices
to which Puncak Niaga subscribes;
•
to review this Policy as and when appropriate and ensure it is understood by all employees and is available to
all interested parties.
HEALTH,
SAFETY
&
ENVIRONMENTAL
report
Aeration system at Sungai Gombak WTP
Awareness on Health, Safety and the Environment
Puncak Niaga has always been concerned about issues relating to Health, Safety and the Environment (HSE), both at
the workplace and in the community. As an expression of our concern, all documents relating to HSE have been
carrying our HSE logo and motto, “Health, Safety & Environment – Our Clear Vision”, since these were formally
launched in October 2004. A Corporate Health, Safety and Environmental (HSE) Manual has been implemented at all
our water treatment plants (WTPs) and dams, which aims:
•
to provide a safe and environment friendly workplace in the most effective manner;
•
to highlight to clients and ultimately the public of the Company’s commitment to HSE; and
•
to facilitate staff induction in regard to their knowledge on HSE.
Puncak Niaga Holdings Berhad
1
HEALTH, SAFETY & ENVIRONMENTAL REPORT
Crisis or Emergency Readiness
As the supplier and distributor of treated water to consumers in the State of Selangor and the Federal Territories of
Kuala Lumpur and Putrajaya, the PNHB Group has to be able to respond quickly and effectively to any crisis or
emergency, with negligible disruption to our business operations and minimal inconvenience to the consumers. To
enable our staff to do so in a systematic and organised manner, a Crisis Management Plan and an Emergency
Response Plan (ERP), which plans incorporate procedures at Puncak Niaga (M) Sdn Bhd (PNSB) and Syarikat Bekalan
Air Selangor Sdn Bhd (SYABAS), and also involve the State Authorities and relevant government agencies such as
BOMBA, Police and Malaysian Red Crescent Society have been put in place, which will be activated in the event of
any crisis or emergency.
The Group’s response to a crisis or emergency is controlled and coordinated by our Crisis Command Centre. In 2005,
the Centre was activated five times to handle the following events:
Crisis Command Centre
No.
Date
Event
1.
11 August 2005
Action plan on haze
2.
9 September 2005
Oil spill at Gombak River
3.
19 September 2005
Dry spell – shortfall of raw water to WTPs in the Northern Region
4.
28 September 2005
Oil palm lorry accident at BRH WTP catchment area
5.
5-12 December 2005
ASEAN Summit
The oil spill at Gombak River, which occurred on 9 September
2005, was a major incident that tested the PNHB Group’s ability in
handling a crisis situation involving consumers in the Gombak
area. Whilst the custody of the river is not under the Group’s
jurisdiction, the supply of treated water from the river is the
Company’s responsibility. The Management and operations
personnel of our two subsidiaries collaborated closely with the
relevant authorities, the media and consumer groups, and
succeeded in bringing the crisis under control within four days, i.e.
by 13 September 2005, with minimum shortcomings.
The episode has helped to test PNSB’s and SYABAS’s ERP system
to the full by highlighting weaknesses that have since been
rectified and improved. The incident has also prompted the State
Authorities to review and improvise their respective ERPs. All
parties are now more aware of their respective roles and
responsibilities and better prepared to handle such situations in
the future.
Aftermath of oil spill at Gombak River
Puncak Niaga Holdings Berhad
2
HEALTH, SAFETY & ENVIRONMENTAL REPORT
Health and Safety at the Workplace
As a responsible and caring employer, the PNHB Group has been providing the necessary safety and health
mechanisms for employees who may be exposed to hazards while performing their duties. Although steps taken are
in line with statutory requirements, the Group relies on its own internal control measures in giving priority to safety
at the workplace. The Corporate Safety & Health Committee, set up in 2004, continues to play a prominent role in
developing policies and ensuring that these policies, approved by the Management, are adhered to.
At PNSB, all staff have to undergo annual safety and health training to instill in them a high level of safety awareness.
Safety induction training, mock drills as well as ERP training have been carried out at all 28 WTPs and the three dams
to train staff to be responsive and ready in the event of emergencies. In addition, Site Safety Inspection and Safety
Compliance Audits are conducted at all WTPs and dams. These programmes aim to ensure that the WTPs and dams
comply with safety regulations and adhere to the safety management system established in the Company. In the
process, matters such as adequate signage as well as proper storage of chemicals and usage of personal protective
equipment at the workplace are also reviewed annually.
In 2005, all 28 WTPs were registered with the Department of Occupational Safety and Health in compliance with the
Factories and Machinery Act, 1967. During the year, 63.0% of machineries at the WTPs have been issued Certificates
of Fitness, with the rest to be completed by 2006.
The Quality of Water
Our discerning consumers expect their water to be safe and of
high quality. At the PNHB Group, we strive to fulfil this expectation
by having in place mechanisms and procedures to constantly
monitor the quality of raw water at the intakes of our WTPs and to
produce treated water that meets the Ministry of Health’s Drinking
Water Quality Standard.
We begin at the river itself, which is sometimes subjected to
indiscriminate dumping of untreated waste, illegal sand mining
and logging activities that in turn adversely affect the quality of the
river water. To provide early warning of such raw water quality
violations, we operate and maintain two automated river warning
monitoring stations at Sungai Langat and Sungai Selangor. Besides
that, members of the public are also encouraged to report
incidents of pollution to us through our toll-free river watch
telephone hotline (1800-88-3254).
Water Contamination: Oil spill at Gombak River
At the same time, we conduct surveillance and investigation activities, including regular sanitary surveys and special
environmental investigations, at all water catchment areas. Any violations are reported by our Environmental
Surveillance Section to the Department of Environment (DOE) and Lembaga Urus Air Selangor, since these authorities
are responsible for the rivers. The Section also undertakes studies on water quality problems faced by the WTPs.
Puncak Niaga Holdings Berhad
3
HEALTH, SAFETY & ENVIRONMENTAL REPORT
Puncak Niaga has established a Central Laboratory to conduct both raw and treated water quality assessments, and
a Process Improvement Section that undertakes stringent evaluation of every stage of the water treatment process,
from the point of entry at the WTP intake to treatment to leaving the WTP at the balancing reservoir. The task also
included trouble shooting and providing solutions to process problems besides reducing operating cost and ease of
operation. Our quality assessment and evaluation exercise covers the following:
•
Continuous monitoring of raw water, settled water and treated water quality by on-line analysers at the WTPs;
•
Every two hourly water quality analysis against quality standards of four physical and five chemical parameters;
•
Daily analysis for microbiological parameters;
•
Weekly testing by our Central Laboratory and the Ministry of Health (MOH) at the outlets of the WTPs and
balancing reservoir; and
•
Monthly testing for all parameters by an accredited laboratory according to schedules set by the MOH.
Raw Water Quality
In 2005, there were a total of 796 raw water quality violations (2004: 810) and 123 cases of plant shutdown due to
raw water violations (2004: 164). Of the raw water quality violations, 298 were due to microbiological reasons, 174
due to physical, 322 due to inorganic matter and one due to heavy metals. Most violations occurred in the basins of
the Langat, Selangor and Bernam Rivers.
Breakdown of raw water quality violations according to parameters
Parameter group
No. of violation(s)
2004
2005
Microbiological
345
298
Group I - Physical
163
174
Group II – Inorganic matter
292
322
Group III – Heavy metals
10
2
Group IV – Pesticides
TOTAL
0
0
810
796
Breakdown of raw water violations according to catchment areas
Catchment Area
No. of WTP(s)
No. of violation(s)
2004
2005
Langat River basin
7
399
349
Selangor River basin
6
211
220
Bernam River basin
4
152
137
Kelang River basin
8
23
27
Buloh River basin
2
9
9
Tengi River basin
1
16
54
28
810
796
TOTAL
Puncak Niaga Holdings Berhad
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HEALTH, SAFETY & ENVIRONMENTAL REPORT
Trends in annual raw water quality violations and plant shutdowns
Annual Raw Water Violations & Plant Shutdowns (1995-2005)
Frequency (No.)
796
810
164
156
2000
175
1999
123
1998
102
1997
89
75
87
35
76
511
273
400
200
522
658
600
802
804
800
909
1000
957
1044
1200
0
Year
1995
1996
Total Raw Water Quality Violations
2001
2002
2003
2004
2005
Plant Shutdowns Due To Raw Water Violations
The contamination of raw water can result in plant shutdowns, particularly at the partial WTPs that have limited ability
to treat poor raw water quality due to their design. In 2005, the 123 cases of shutdown contributed to a total
production loss of 947.25 hours (2004: 1,578.41 hours).
The main cause leading to plant shutdowns in 2005 was due to pollution that resulted from road accidents and
leaking of contaminants from construction works into the rivers. An example was the tanker accident on the Karak
Highway that contaminated the Gombak River with crude palm oil. The Cheras Mile 11 WTP also had a shutdown in
July 2005 due to diesel contamination of the Langat River, despite the installation of a new weir upstream of the
Cheras River-Langat River confluence.
Other WTP shutdown cases were mostly due to untreatable turbidity and colour levels by the partial WTPs. PNSB is
in the midst of planning to construct a modern treatment system at these plants to improve production and the
quality of treated water.
Water Quality Index Programme
All WTPs undergo the Water Quality Index (WQI)
Programme, which is conducted monthly without
fail. The WQI value is computed to determine the
cleanliness and availability of water usage for water
supply, aquaculture and irrigation purposes, and
Safety Drill
then accordingly classified as follows:
Emergency Response Plan Drill
Puncak Niaga Holdings Berhad
5
HEALTH, SAFETY & ENVIRONMENTAL REPORT
WQI Class
Water Usage
Class I
Conservation of natural environment
Water Supply I – practically no treatment necessary
Fishery I – very sensitive aquatic species
Class IIA
Water Supply II – conventional treatment required
Fishery II – sensitive aquatic species
Class IIB
Recreational use with body contact
Class III
Water Supply III – extensive treatment required
Fishery III – common species of economic value and tolerant species; livestock drinking
Class IV
Irrigation
Class V
Water unsuitable for any of the above uses
(Source : Department of Environment, Malaysia)
In 2005, the monthly reading at 29 stations found that 22 stations were in Class II while 7 were in Class III (2004: 24
stations were in Class II and 5 in Class III).
Environmental Care
Puncak Niaga takes its corporate environmental responsibility seriously, particularly in the protection and
conservation of water resources. A number of initiatives were taken to monitor the quality of river water throughout
2005, including the following:
•
Six Environmental Impact Studies were conducted as planned at the six water catchment
areas supplying water to the 28 WTPs;
•
Three Sanitary Surveys were conducted as targeted for Cheras Mile 11, SSP2 and Sungai
Langat WTPs inclusive of joint surveys with the authorities;
•
The monthly Water Quality Index (WQI) Programme was completed at 29 stations covering
the 28 WTPs and three Dams;
•
Two environmental investigation cases were conducted in relation to major WTP
shutdowns due to raw water violations;
•
24 environmental investigation cases were undertaken to evaluate and highlight pollution
risk and impact on the WTP and dam operations;
•
Two environmental investigation cases were undertaken to study and propose alternative
raw water resources;
•
The Quality Assurance Programme on water quality was conducted as planned; and
•
The two River Warning Monitoring Stations continued to be in good operating condition.
Public Awareness on Environmental Protection and Conservation
River Rescue Brigade Programme
Puncak Niaga continues to strive towards enhancing public awareness on environmental protection and conservation
as part of its Corporate Social Environmental Awareness Programme. In 2005, we visited various factories to highlight
the impact of pollution and the need to preserve our water resources under our Factory Visit Programme. The
factories visited were Sime Inax (sanitary fittings) at Batang Berjuntai, Contact Dippers (latex - rubber products) at
Batang Kali and NEC (semi-conductor) at Banting.
Puncak Niaga Holdings Berhad
6
HEALTH, SAFETY & ENVIRONMENTAL REPORT
We also endeavour to reach the young generation through our educational programmes that teach them about the
protection and conservation of the environment. Our River Rescue Brigade, initiated in 1998, continues to involve
students who are taken on visits to PNSB’s WTPs and dams. Until 2005, the programme benefited students from 67
primary schools in the State of Selangor and the Federal Territories of Kuala Lumpur and Putrajaya. Our Educational
Outreach Programme (‘Turun ke Padang’), launched in 1999, is also going strong and during the year under review,
the Senior Management of Puncak Niaga and SYABAS visited 15 primary schools located within our areas of operation
to give talks on taking care of rivers, the environment as well as the roles played by Puncak Niaga and SYABAS in the
water treatment and water distribution processes respectively.
In December 2005, we also produced 2.5 million pieces of five different designs of bookmarks and two different
designs of pocket calendars at a cost of RM230,000, which were then distributed to school children and water
consumers in the Klang Valley. These items carried environmental messages such as ‘Water: Our Source Of Life’;
‘Children: Our Future Generation’ and ‘Working Together For A Better Tomorrow’ to create public awareness of
Puncak Niaga and SYABAS and the need to conserve water.
To further drive the message of conservation home, Puncak Niaga contributed RM200,000 towards the publication of
a book, ‘Maliau Basin: Sabah’s Lost World’. Authored by Tengku Zainal Adlin, Dr Waidi Sinun and Hans P. Hazebroek,
this beautifully produced and captivating book portrays the uniqueness of the flora and fauna of the Maliau Basin
Conservation Area, which has a natural history that spans several million years. The Sabah State Government has
proposed to the United Nations that the area be declared a World Heritage site.
EVERYONE’S DUTY
AND RESPONSIBILITY
Every day, in the newspapers and on television, we are being informed of
cases of gross degradation of our environment and natural resources. As these
cases continue to occur day in and day out, it is becoming painfully obvious
that all the exhortations and reprimands by government departments and
authorities are not having the desired effect of curbing, if not containing,
further degradation of our environment and natural resources. If we are to
stop the destruction of our finite natural resources, there has to be stricter
enforcement of laws, bylaws and regulations. Just as importantly, these laws,
bylaws and regulations must be amended to provide for much heavier
penalties or other deterrent sanctions on violators.
In the final analysis, for Malaysia to achieve sustainable development and for
our future generations to continue enjoying our natural resources, it is the duty
and responsibility of every corporation and individual to protect and
Sungai Langat Dam
Puncak Niaga Holdings Berhad
conserve the environment in their day-to-day activities.
7