VISION
To Be The Preferred Offshore Services Partner In Oil & Gas Industry
MISSION
We provide quality services to the offshore oil and gas industry with emphasis on:
Corporate Philosophy
QUALITY POLICY
Alam Maritim Resources Berhad provides
the following services to the oil and gas
industry:
2
ALAM MARITIM RESOURCES BERHAD (700849-K)
Corporate Information
Board of Directors
Dato Captain Ahmad Sufian
@ Qurnain bin Abdul Rashid
Non-Executive Chairman
Azmi bin Ahmad
Managing Director/
Chief Executive Officer
Legal Advisor
Zul Rafique & Partners
D3-3-8
Solaris Dutamas
No.1 Jalan Dutamans 1
50480 Kuala Lumpur
Malaysia
Tel : + 603 - 6209 8228
Audit Committee
Dato Haji Ab Wahab bin
Haji Ibrahim
(Chairman)
Share Registrar
Auditors
3
Annual Report 2010
Principal Bankers
Financial Calendar
29/04/2011
29/04/2011
28/02/2011
26/11/2010
26/08/2010
Annual Audited
Accounts for the
Financial Period Ended
31/12/2010
Quarter Report on
Consolidated Results
for the Financial Period
Ended 31/12/2010
Quarterly Report on
Consolidated Results
for the Financial Period
Ended 30/9/2010
Quarterly Report on
Consolidated Results
for the Financial Period
Ended 30/6/2010
20/07/2010
19/07/2010
05/07/2010
Alam Maritim
Resources Berhad
(AMRB) proposed
bonus issue of up to
272,478,675 new
ordinary shares of
RM0.25 each in amrb
(share(s)) (bonus
share(s)) on the basis
of one (1) bonus share
for every two (2) existing
shares (bonus issue)
06/07/2010
Notice of Bonus Entitlement
25/06/2010
03/06/2010
02/06/2010
01/06/2010
01/06/2010
27/05/2010
19/05/2010
Final Dividend
Quarterly Rpt on
Consolidated Results
for the Financial Period
Ended 31/3/2010
17/05/2010
14/05/2010
14/05/2010
25/02/2010
Employees' Share
Option Scheme
("Scheme")
Quarterly Report on
Consolidated Results
for the Financial Period
Ended 31/12/2009
4
ALAM MARITIM RESOURCES BERHAD (700849-K)
In RM
1,400,000,000
1,200,000,000
1,000,000,000
800,000,000
2006
600,000,000
2007
400,000,000
2008
200,000,000
2009
2010
0
(200,000,000)
Revenue
NTA
In Sen
20.0
15.0
10.0
5.00
0
201
9
200
8
200
7
200
200
EPS (net)
(5.00)
RM
Revenue
Profit before tax
NTA
EPS (net)
2006
2007
2008
2009
2010
151,161,092
249,900,157
322,854,213
348,917,132
242,191,823
60,853,274
68,522,841
100,711,492
112,524,398
(18,115,606)
450,680,936
746,842,527
950,454,515
476,472,759
1,295,790,935
11.10
10.60
15.10
17.60
(2.13)
5
Annual Report 2010
5
4
3
2
1
2010
%
RM
1.
Charter Hire
74.97%
181,572,851
2.
11.28%
27,324,592
3.
2.35%
5,691,220
4.
Equipment Rental
2.35%
5,683,509
5.
5.07%
12,276,457
6.
Ship Catering
0.67%
1,614,852
7.
2.57%
6,220,915
8.
0.75%
1,807,427
100%
242,191,823
6
ALAM MARITIM RESOURCES BERHAD (700849-K)
Our Fleet
No Vessel name
Type
Year Built
Classiffication BHP
Dimension (L x B x D)
Accommodations
N/A
Alam 281
2006
BV
NA
Setia Station 1
2009
BV
NA
300 berths
1MAS-300
2010
ABS
NA
300 berths
Brompton Sun
2000
ABS
9,500
Setia Kilas
Crew Boat
2009
ABS
4,200
80 Pax seating
Setia Deras
Crew Boat
2009
ABS
4,200
80 Pax seating
Setia Cekal
Diving Workboat
1996*
SCM
4,400
60 berths
Setia Sakti
2008
BV
5,150
134 berths
Setia Aman
Accommodation/ Workboat
2009
BV
5,220
174 berths
10
Setia Ulung
Accommodation/ Workboat
2009
BV
5,220
174 berths
11
Setia Cekap
Tug Utility
2005
BV
3,500
20 berths
12
Setia Azam
Tug Utility
2007
NKK
3,880
20 berths
13
Setia Wira
Tug Utility
2007
BV
3,500
28 berths
14
Setia Yakin
Tug Utility
2008
NKK
3,200
28 berths
15
Setia Zaman
Tug Utility
2008
NKK
2,400
26 berths
20 berths
16
Setia Budi
Tug Utility
2008
NKK
2,400
17
Setia Gagah
2003
NKK
4,750
23 berths
18
Setia Handal
2003
BV
3,000
22 berths
19
Setia Kasturi
2005
NKK
4,750
24 berths
42 berths
20
Setia Indah
2005
BV
4,750
21
Setia Gigih
2009
BV
5,220
46 berths
22
Setia Kental
2009
BV
5,220
46 berths
23
Setia Jaguh
1999
BV
8,920
64 m x 15 m x 6.8 m
31 berths
24
Setia Emas
2004
BV
4,750
48 m x 13.2m x 5.20m
24 berths
25
Setia Fajar
2005
BV
5,150
42 berths
26
Setia Lestari
2005
BV
4,750
42 berths
27
Setia Nurani
2005
BV
5,150
42 berths
28
Setia Padu
2006
BV
5,150
42 berths
29
Setia Rentas
2007
BV
5,150
42 berths
30
Setia Tangkas
2007
BV
5,150
42 berths
31
Setia Unggul
2007
BV
5,150
42 berths
32
Setia Wangsa
2007
BV
5,150
42 berths
33
Setia Tegap
2008
BV
5,000
42 berths
34
Setia Teguh
2008
BV
5,150
42 berths
35
Setia Hebat
2008
BV
5,000
50 berths
36
Setia Iman
2010
BV
5,150
42 berths
37
Setia Luhur
2010
BV
5,150
42 berths
38
Setia Erat
2010
BV
5,150
42 berths
39
Setia Qaseh
2010
BV
5,150
42 berths
40
Setia Abadi
Utility Vessel
1980
BV
1,040
21 berths
41
Setia Damai
Utility Vessel
1985
SCM
1,608
16 berths
42
Setia Jati
2012
ABS
12,000
75m x 17m x 8m
50 berths
2012
ABS
12,000
75m x 17m x 8m
50 berths
(New building)
43
Setia Perkasa
7
Annual Report 2010
Fleet Graph
Brake
horsepower
(BHP)
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
1999
2000
Anchor Handling
Tug Supply Vessel
Anchor Handling
2001
2002
2003
Tug/Terminal
Support Vessel
2004
Multipurpose Support /
Accommodation Work
Vessel
8
ALAM MARITIM RESOURCES BERHAD (700849-K)
2005
Crew Boats/
Utility Vessel
Brake
horsepower
(BHP)
90,000
80,000
70,000
60,000
50,000
40,000
30,000
20,000
10,000
0
2006
2007
Supply Vessel
2008
2009
Utility/Maintenance
Vessel
2010
As at May 2011
Fast Multipurpose
Supply vessel
Utility/Maintenance Vessel
9
Annual Report 2010
5/13/11
7:12 PM
Page 10
Model
Type
Dimension
:
:
Weight in air
Performance
:
:
Work Capabilities
Power
Model
Type
Dimensions
:
:
Weight in air
Performance
:
:
PARI SERIES
125HP Work-Class ROV
1,500m (Free-swimming)
Length x Width x Height
2,500mm x 1,450mm x 1,800mm
2,400kg
Forward 700kgf 3.5 knots
Lateral 550kgf 3.0 knots
Vertical 500kgf 1.5 knots
Work Capabilities :
KINGFISHER
Inspection and Light
Work-Class ROV
300 meters
Length x Width x Height
1400mm x 900mm x 1,100mm
500kgs
Forward 110kgf 3.0 knots
Reverse 77kgf 3.0 knots
Lateral 73kgf 2.5 knots
Vertical 55kgf 1.5 knots
Model
Type
Power
:
:
Tooling Options
10
ALAM MARITIM RESOURCES BERHAD (700849-K)
Generic Specification
The 200m, 9-man saturation diving system with 3-man bell,
was designed and fabricated to IMCA DESIGN D024 Standard
in 2004 and certified by the American Bureau of Shipping
(ABS). The system has undergone Thermal Test successfully
in January 2005 as recommended by International Marine
Contractor Association (IMCA).
Divebell
Surface Decompression
Chamber
Generic Specification
The IMCA D023 DESIGN compliant air/mixed gas diving system comprises the following units:
A.
Control Van - a 20 footer air-conditioned container with lighting and power points, complete with Dive Supervisors desk,
dive control panel, CCTV, video recorders, divers communication, umbilical and deck decompression chamber.
B.
Machinery Van - a 20 footer container complete with hydraulic power pack, air/gas cylinders, air bank, a low pressure
compressor, a high pressure compressor and two exhaust fans.
C.
Launching and Recovery System - a skid mounted complete with a 2 tonne A-Frame, a dive stage, clump weight,
hydraulic winch and tool box.
11
Annual Report 2010
Corporate Structure
(as of 29 April 2011)
100%
WHOLY-OWNED
COMPANIES
PARTIALLY-OWNED
COMPANIES
EASTAR OFFSHORE
PTE LTD
75%
100%
WORKBOAT INTERNATIONAL
DMCCO
60%
60%
51%
51%
50%
TH ALAM MANAGEMENT
(M) SDN BHD
50%
49%
100%
100%
100%
100%
100%
100%
ALAM-PE I
(L) INC
ALAM-PE II
(L) INC
ALAM-PE III
(L) INC
ALAM-PE IV
(L) INC
12
ALAM MARITIM RESOURCES BERHAD (700849-K)
100%
100%
100%
84%
KJ WAJA ENGINEERING
(M) SDN BHD
KJ WAJA SERVICES
SDN BHD
100%
70%
60%
60%
60%
60%
50%
50%
49%
100%
100%
ALAM-PE V
(L) INC
ALAM-PE
HOLDINGS
SDN BHD
13
Annual Report 2010
No.
Company
Issued and
Fully Paid-Up
Share Capital
Effective Equity
Interest (%)
Principal Activity
1.
15.07.1996 Malaysia
RM20,000,000.00
100%
2.
USD8,940,100.00
100%
3.
20.09.2000 Malaysia
RM100,000.00
100%
4.
14.04.2008 Malaysia
RM100,000.00
100%
5.
16.11.2000 Malaysia
RM1,500,000.00
84%
6.
21.07.2005 Malaysia
RM100,000.00
84%
7.
01.01.2008 Singapore
SGD500,000.00
75%
8.
01.03.2006 Singapore
SGD628,203.00
75%
9.
05.02.1999 Malaysia
RM500,000.00
70%
10.
21.11.2000 Malaysia
RM300,000.00
60%
11.
USD1,050,000.00
60%
12.
USD1,050,000.00
60%
13.
USD2,795,000.00
60%
14.
Workboat International
DMCCO (Workboat International)
03.05.2005
United Arab Emirates
AED1,000,000.00
60%
15.
USD100.00
60%
16.
USD1,350,000.00
51%
17.
USD3,500,000.00
51%
18.
30.11.2004 Malaysia
RM2.00
50%
19.
USD10,000,000.00
50%
14
ALAM MARITIM RESOURCES BERHAD (700849-K)
No.
Company
Issued and
Fully Paid-Up
Share Capital
Effective Equity
Interest (%)
Principal Activity
20.
07.12.2009 Malaysia
RM100.00
50%
Ship operator
21.
RM2.00
50%
22.
USD14,000,000.00
49%
Investment holding
23.
USD100.00
49%
24.
USD100.00
49%
25.
USD100.00
49%
26.
USD100.00
49%
27.
USD100.00
49%
28.
16.09.2008, Malaysia
RM2.00
49%
Management Company
29.
USD17,759,995.00
49%
Investment holding
30.
USD1.00
49%
Ship owning
31.
USD1.00
49%
Ship owning
15
Annual Report 2010
Calendar of Events
13 January 2011
Alam Maritim Group sponsored 120 bicycles to students of
SM Tengku Nur Zahirah, Besut, Terengganu in conjunction with CSR
program organised by Petronas Carigali Sdn Bhd (Peninsular
Malaysia Operation).
8 January 2011
Alam Maritim Group launched its Green The Earth Day Program at
Danau Perikanan, Taman Pertanian Malaysia, Bukit Cerakah,
Shah Alam.
1 January 2011
Delivery of Setia Station 1, a newly built accommodation
crane work barge vessel to Alam Maritim Group.
25 November 2010
Launching ceremony of 1Mas - 300, a newly built 300 men pipelay
accommodation work barge to Alam Maritim Group.
18 October 2010
Alam Maritim Group was invited as a strategic partner in Carnival My Pelaut organized by Malaysian
Marine Department in Celebration of World Maritime Day 2010.
1 October 2010
Delivery of MV Setia Luhur, a newly built DP1
5,150 bhp anchor handling tug supply vessel to
Alam Maritim Group.
21 August 2010
Alam Maritim Group presented financial contributions to Rumah Nurhasanah,
Pusat Jagaan Baitul Hidayah and Pusat Jagaan Siti Nuraini, Kajang during Majlis
Silaturrahim Ramadhan 2010.
17 August 2010
Delivery of MV Setia Iman, a newly built
DP1 5,150 bhp anchor handling tug supply
vessel to Alam Maritim Group.
16
ALAM MARITIM RESOURCES BERHAD (700849-K)
Year
Achievement
2011
Contractor Safety Recognition by ExxonMobil - Marine Contractor of the Quarter Award 2011 in
Recognition of Outstanding Contribution to Safety.
2011
HSE Performance Gold Award by PETRONAS Carigali Sdn Bhd Recognition of HSE Achievement,
Green the Earth (Environment Category).
2010
HSE Special Award to Alam Maritim Resources Berhad In Recognition Of 250 Days Free Of Total
Recordable Case (TRC)
2009
2009
PETRONAS Group HSE & Sustainability Awards FY2008/2009 Major Contractor Safety Category Merit
Award In Recognition To Project Of HSE Mentor-Mentee Program In Alam Maritim
2009
Recognition by Carigali Hess For MV Setia Wangsa-Completion of 1 Year Service Without Any Loss
Time Injury (LTI).
2009
Contractors Safety Recognition by ExxonMobil Injury Free for Contractor Recording up to 100,000
Man-Hours.
2008
ISO 9001:2000 Certification by Bureau Veritas to Alam Maritim Resources Berhad, Alam Maritim (M)
Sdn Bhd, Alam Hidro (M) Sdn Bhd And Alam Offshore Logistics & Services Sdn Bhd.
2008
Achievement of 2.7 Million Safe Work-Hours without Loss Time Injury (LTI).
2007
2006
2006
Contractors HSE Award by PETRONAS Carigali Sdn Bhd - Recognition of an Excellent HSE Achievement.
2005
Gold Award by PETRONAS Carigali Sdn Bhd - Recognition of Excellent HSE Performance
for 2004/2005.
2004
2003
2003
Certificate of Achievement 2.4 Million Man-Hours without Loss Time Injury HSE Performance
from TL Offshore Sdn Bhd.
2002
2001
17
Annual Report 2010
DEPLOYING RESOURCES
STRATEGICALLY
CHAIRMANS STATEMENT
My fellow shareholders,
On behalf of the Board of
Directors, it gives me great
pleasure to present the Annual
Report of Alam Maritim
Resources Bhd (AMRB) for
the financial year ended
31 December, 2010.
ECONOMIC OVERVIEW
In the year under review we witnessed a modest
recovery in the world economy with an average
growth of about 3.9% after the contraction in 2009.
In Asia the outlook remains strong underpinned by
strengthening domestic demand.
The Malaysian economy in 2010 rebounded by 9.4%,
year on year, buoyed by strong exports and a
resurgence of demand from the domestic market.
Inflation averaged at a manageable rate of slightly
less than 2%. In a nutshell, the Malaysian economy
seems firmly on the recovery path, with many
initiatives undertaken by the Government.
INDUSTRY OVERVIEW
Despite the recovery, the oil and gas industry was not
growing at similar pace compared to the other
economic sectors, judging from the cutback in the
investments and postponements of projects. We
could say the worst of the global economic meltdown
was over but the pace of recovery varied from
industry to industry. The oil and gas industry was still
in recovery mode and was grappling with such issues
as debt over hangs and tight credit facilities. Global
demand shrank from about 86 million barrels per
day in the first half of 2008 to about 84 million barrels
per day in 2010, a decline of some 2 million barrels
per day the biggest decline in over 3 decades.
Demand contraction could not have come at a worse
time for the industry, which has invested heavily in
previous years when prices were peaking and WTI
reaching record high of USD147 per barrel in July
2008. Since then prices have been sliding downwards
and plunged to a level low USD40 per barrel before
gradually strengthening to the current level. And,
20
ALAM MARITIM RESOURCES BERHAD (700849-K)
FINANCIAL HIGHLIGHTS
For the year ended 31 December 2010,
AMRB posted a net loss of RM13.0
million from a revenue of RM242.2
million. Earnings per share for the year
stood at 2.2 sen per share while net
tangible assets per share was 60 sen.
In contrast to 2009, the financials of
2010 are without a doubt weaker, but
then 2010 was not an ordinary or
average year, with trials and
tribulations at every corner. This is
attributable mainly to impairment loss
on trade receivables.
Under the circumstances we have
performed well, keeping the company
on a steady course, and we hope to
reap the benefits of the better
operating environment in 2011.
OUTLOOK
Bank Negara has recently reported that
it expects Malaysias GDP to grow by
about 5% to 6% in 2011 with inflation
expected to increase to about 2.5% to
3.5%
this
year.
Numerous
transformation efforts including the
Economic Transformation Program or
ETP, the New Economic Model and the
10th Malaysia Plan, among others,
helped boost the sentiment and kick
start the economy throughout 2010 and
into 2011.
21
Annual Report 2010
CORPORATE EXERCISE
A bonus issue of one for two was
approved at the AGM held on 25 June
2010 and in July 2010 the bonus issue
amounting to 254,237,816 million
shares of RM0.25 each was floated on
the Bursa Malaysia.
ACKNOWLEDGEMENT
& APPRECIATION
On behalf of the Board of Directors
I would like to bid farewell to YBhg
Dato Mohamed Idris bin Mansor who
has left us in April 2010 for a position
on the Board of PETRONAS.
It was a pleasure working with Dato
Idris on our Board especially with his
wealth of experience in the oil and gas
industry. We wish him well in his new
position with Petronas.
I would also like to welcome on board
Puan Fina Norhizah binti Haji Baharu
Zaman as an Independent NonExecutive director. Her vast experience
garnered in PETRONAS, and MISC
coupled with her legal background will
be an asset for the Board of AMRB.
I would like to thank our stakeholders
for their continuous trust, support and
confidence in AMRB. My sincere
appreciation also goes to our
customers, shareholders, business
associates as well as the various
regulatory and government authorities.
Last but not least my thanks to the
dedicated management team and
employees for their commitment
and contribution to the success of
Alam Maritim.
OPERATIONAL REVIEW
The OSV segment suffered not only in terms of lower average
utilisation rate but also due to softening daily charter rates
arising from overcapacity and cautious stand adopted by oil
majors around the world post economic downturn. The rates
dived from USD2.70 and USD2.20 (FY2009) to the range of
USD1.75 to USD1.70 per brake horse power for the year
under review. Besides, weaker US Dollar affected our Group
revenue to a certain extent. The intense competition among
the players also did not help the situation.
The Expectation
Following our sterling performance in FY2009 that boasted a
22 percent increase in the net profit, we entered the FY2010
with sky-high expectations. Having been backed by strong
fundamentals and promising market outlook, we sailed the
sea with confidence to deliver yet another year of stellar
results to our shareholders.
However, FY2010 ended up being a very tough year for us.
The marginal growth in revenue recorded in 2009 was indeed
a signal to even more sluggish year of 2010. Oil majors were
cautious in their spending, hence only limited number of new
contracts was put on tender. In addition, longer term
contracts were temporarily suspended or subjected to early
termination. Floods of new players were competing for the
limited number of new contracts, whilst weaker US dollar
put more pressure on the already softening daily
charter rates.
Segment
Revenue
(RM Million)
2010
2009
OSV
199.8
223.2
Underwater services,
OIC and ROV
47.8
146.9
The Strategy
Looking back at the challenges in 2010, we consider that
FY2010 the most trying year for our Groups operations since
we become a main market-listed OSV and integrated
offshore support services company in 2006. Despite trying
our best to deliver optimal result for the shareholders,
we only managed to post a revenue of RM242.2 million,
30 percent lower than FY2009 (RM347.4 million). Inevitably,
we recorded a net loss of RM13.0 million from a net profit of
RM95.4 million in 2009.
The Postmortem
Our analysis revealed that the slide in earnings was
undoubtedly influenced by several internal and external
factors. By and large, lower contributions were recorded from
all business sectors vis-a-vis, OSV and Underwater Services,
that comprised Offshore Installation & Construction (OIC) as
well as from the Remotely Operated Vehicle (ROV) business,
hence significantly affecting the overall performance of our
Group FY2010.
Unemployed Groups bigger-sized vessels that were due for
repair and maintenance during the reviewed period further
caused under utilisation and directly impacted our top and
bottom lines. The OSV segment was under more pressure
when three of our AHT/Supply vessels failed to secure any
job since the Q4 2010. The average utilisation rate of our
vessels dropped from an average of 90 percent in FY2009 to
only 75 percent in FY2010.
22
ALAM MARITIM RESOURCES BERHAD (700849-K)
AZMI AHMAD
Managing Director/CEO
29 April 2011
He qualified as a Master Mariner with a Master in ForeignGoing Certificate of Competency from the United Kingdom in
1974 and a Diploma in Applied International Management
from the Swedish Institute of Management in 1984. He also
attended the Advance Management Program (AMP) at
Harvard University in 1993. He is a Fellow of the Nautical
Institute, (UK), a Fellow of the Chartered Institute of Logistics
& Transport and a Fellow of the Institute Kelautan Malaysia.
He has over 38 years of experience in the international
maritime industry.
24
ALAM MARITIM RESOURCES BERHAD (700849-K)
25
Annual Report 2010
27
Annual Report 2010
AHMAD HASSANUDIN
BIN AHMAD KAMALUDDIN
Executive Director
Alam Maritim Group
Executive Chairman, AHSB
HSE Director
SHAHARUDDIN
BIN WARNO
@ RAHMAD
Executive Director /
Chief Operating Officer
Alam Maritim Group
JOHN DLIMA
Managing Director
Workboat International
28
ALAM MARITIM RESOURCES BERHAD (700849-K)
WU QIONG
Managing Director
Eastar Offshore
SAMUEL BERNARD
SASSOON
Executive Director
Eastar Offshore
29
Annual Report 2010
Corporate Responsibility
a.
Social Community
AMRB remains committed to giving back to the community by aligning its
corporate activities to worthy social causes which extends beyond the
workplace.
During the year under review, the Company contributed in a meaningful
way to society via financial and other forms of aid. This is part of the
corporate social responsibility (CSR) projects which includes visiting old
folks homes, orphanages and other small projects such as participation
in voluntary works. The Company also actively participated in programmes
which are organized by AMRBs clients.
c.
Environment
Green the Earth programme is the latest project undertaken by the
Company which was held at Taman Pertanian Malaysia, Shah Alam,
Selangor. 120 Bucida Molinette trees were planted by Alam Maritim
employees. This programme was initiated to support the Governments
vision to plant 20 million trees by the end of 2014, and forms part of the
companys ongoing environmental awareness efforts that emphasize longterm preventative measures to minimise negative environmental effects.
This initiative is part of the companys commitment towards certification
to the ISO14001:2004, Environmental Management System.
d.
Sustainable Development
The Group now is pursuing a structured approach to develop a policy on sustainable development. As the Group aspires to make HSE
and risk management second nature in its operations, it will do the same in the area of sustainable development. The Group considers
such a move as a pre-requisite for image building and believe that having it as an integral part of its value proposition will provide the
Group extra mileage in its endeavor to be a preferred partner and service provider. It definitely will reflect the sensitivity of the Group
whilst operating in a socially-responsible and environmentally-friendly atmosphere. Towards this end the Group has embarked on
CSR programmes and put in place policies that promote transparency, corporate governance, human rights, and HSE, among others.
In fact, sustainable development has now been made part of the agenda in our five-year Business Plan.
30
ALAM MARITIM RESOURCES BERHAD (700849-K)
STRENGTH IN
ADVERSITY
31
Annual Report 2010
5/5
5/5
Upon invitation by the Audit Committee, the Executive Directors, Head of Finance & Accounts, Head of Internal Audit and
representatives of the External Auditors attended all the meetings. Prior to the Audit Committee Meetings, private sessions
were held between the Chairman and the Head of Internal Audit without the managements presence. The Audit Committee
also had 2 meetings with the External Auditors without the management presence.
Minutes of each meeting shall be kept and distributed to each member of the Committee and of the Board. The Chairman
of the Committee shall report on each meeting to the Board. The secretary of the Committee shall be the Group Secretary.
All members of the Audit Committee are financially literate and are able to analyse and interpret financial statements to
effectively discharge their duties and responsibilities as members of the Audit Committee.
Composition
The Audit Committee shall comprise at least three Directors, the majority of whom are independent. The members of
the Audit Committee shall be appointed by the Board of Directors and all members of the Audit Committee including
the Chairman are Independent Directors.
At least one member of the Audit Committee shall be a member of the Malaysian Institute of Accountant or if not a
member of the Malaysian Institute of Accountants, must have at least three years working experience and have passed
the examinations specified in Part I of the First Schedule of the Accountants Act, 1967 or a member of one of the
associations specified in Part II of the said schedule or fulfils such other requirements as prescribed by Bursa Securities.
No alternate director shall be appointed as a member of the Audit Committee. The Board shall review the terms of
office and performance of the members of the Audit Committee at least once every three years to determine whether
the members have carried out their duties in accordance with their terms of reference.
In the event of any vacancy in the Audit Committee resulting in the noncompliance of subparagraph 15.09(1) of the
Listing Requirements of the Bursa Malaysia Securities Berhad, the Board shall fill the vacancy within three months
from the date of the vacancy.
32
ALAM MARITIM RESOURCES BERHAD (700849-K)
(b) Chairman
An Independent Non-Executive Director shall be the Chairman of the Audit Committee.
(c)
(d) Quorum
A majority of the members in attendance must be Independent Directors in order to form a quorum for the meeting.
(e) Authority
The Audit Committee is authorised by the Board to review any activity within the Audit Committees terms of reference.
The Audit Committee is authorised to seek any information the Audit Committee requires from any Director or member
of management and has full and unrestricted access to any information pertaining to the Group and the management,
and all employees of the Group are required to comply with the requests made by the Audit Committee.
The Audit Committee is authorised by the Board to obtain external professional advice and secure the attendance of
outsiders with relevant experience and expertise if it considers this necessary, the expenses of which will be borne by
the Company.
In the event that any member of the Audit Committee shall need to seek external professional advice in furtherance of
his duties, he shall first consult with and obtain approval of the Chairman of the Audit Committee.
Where the Audit Committee is of the view that the matter reported by it to the Board has not been satisfactory resolved
resulting in a breach of the Main Market Listing Requirements, the Audit Committee shall promptly report such matter
to Bursa Securities.
The Audit Committee shall have direct communication channels and be able to convene meetings with the External
Auditors without the presence of Executive Directors and management, whenever deemed necessary.
33
Annual Report 2010
Financial Reporting
To review the quarterly, and annual financial statements of the Company, focusing particularly on:
-
(c)
To review any related party transactions and conflict of interest situations that may arise within the Group including
any transaction, procedure or course of conduct that raises questions of management integrity.
Audit Reports
To prepare the annual Audit Committee report to the Board which includes the composition of the Audit Committee,
its terms of reference, number of meetings held, a summary of its activities and the existence of an Internal Audit
unit and summary of the activities of that unit for inclusion in the Annual Report; and
To review the Boards statements on compliance with the Malaysian Code on Corporate Governance for inclusion
in the Annual Report.
To consider annually the Risk Management Framework adopted within the Group and to be satisfied that the
methodology employed allows the identification, analysis, assessment, monitoring and communication of risks in
a regular and timely manner that will allow the Group to minimise losses and maximise opportunities;
To ensure that the system of internal control is soundly conceived and in place, effectively administered and
regularly monitored;
To cause reviews to be made of the extent of compliance with established internal policies, standards, plans and
procedures including for example, the Group Policies & Authorities;
To obtain assurance that proper plans for control have been developed prior to the commencement of major areas
of change within the Group;
and
To recommend to the Board steps to improve the system of internal control derived from the findings of the Internal
and External Auditors and from the consultations of the Audit Committee itself.
To be satisfied that the strategies, plans, manning and organisation for internal auditing are communicated down
through the Group, specifically:
-
to review the Internal Audit plans and to be satisfied as to their consistency with the Risk Management
Framework used, adequacy of coverage and audit methodologies employed;
to be satisfied that the Internal Audit unit within the Group has the proper resources and standing to enable
them to complete their mandates and approved audit plans;
to review status reports from Internal Audit and ensure that appropriate actions have been taken to implement
the audit recommendations;
to recommend any broader reviews deemed necessary as a consequence of the issues or concerns identified;
to review any appraisal or assessment of the performance of the members of the Internal Audit, approve any
appointment or termination of senior staff members of Internal Audit and inform itself of any resignations of
staff of Internal Audit and reasons thereof;
to ensure Internal Audit has full, free and unrestricted access to all activities, records, property and personnel
necessary to perform its duties; and
to request and review any special audit which it deems necessary.
34
ALAM MARITIM RESOURCES BERHAD (700849-K)
(f)
External Audit
To review the External Auditors audit plan, nature and scope of the audit plan, audit report, evaluation of internal
controls and co-ordination of the External Auditors. The Audit Committee will consider a consolidated opinion on
the quality of external auditing at one of its meetings;
To review with the External Auditors the Statement on Internal Control of the Group for inclusion in the Annual
Report;
To review any matters concerning the appointment and re-appointment, audit fee and any questions of resignation
or dismissal of the External Auditors;
To review and evaluate factors related to the independence of the External Auditors and assist them in preserving
their independence;
To be advised of significant use of the External Auditors in performing non-audit services within the Group,
considering both the types of services rendered and the fees, such that their position as auditors are not deemed
to be compromised; and
To review the External Auditors findings arising from audits, particularly any comments and responses in
management letters as well as the assistance given by the employees of the Group in order to be satisfied that
appropriate action is being taken.
SUMMARY OF ACTIVITIES
During the year, the Audit Committee carried out its duties in accordance with its terms of reference. Other main issues
reviewed by the Audit Committee were summarised as follows:
Review of the Internal Audit Plans and scope for the Company and the Group prepared by the Internal Auditors and the
External Auditors respectively;
Review of the reports for the Company and the Group prepared by Internal Auditors and the External Auditors and
consideration of the major findings by the auditors and managements responses thereto;
Review of the quarterly and Annual Reports of the Company and the Group prior to submission to the Board of Directors
for consideration and approval;
Review the related party transactions entered into by the Company and the Group and the disclosure of such transactions
in the Annual Report of the Company;
Review of the Report on the Audit Committee, Statement on Internal Control and Statement on Corporate Governance
prior to their inclusion in the Companys Annual Report;
Review and verify the allocation of options pursuant to the Companys ESOS schemes.
35
Annual Report 2010
Ascertaining the extent of compliance with established policies, procedures and statutory requirements;
Carrying out investigations and special reviews requested by management and/or the Audit Committee; and
Identifying opportunities to improve the operations of and processes in the Company and the Group.
The system of internal controls was satisfactory and has not resulted in any material losses, contingencies or uncertainties
that would require disclosure in the Companys Annual Report.
RISK MANAGEMENT
The effective management of risks associated with all aspects of the Groups business is critical to maximising the Groups
shareholder value. The business risks for the Group are affected by a number of factors, not all of which are within the
Groups control. These externally driven challenges, together with general business risk exposures such as corporate
reputation and operational issues are constantly reviewed as part of the Risk Management programme of the Group.
The Group adopts a proactive Risk Management programme with the following objectives:
ensuring that the Groups operations do not impact negatively on the environment;
ensuring compliance with the Malaysian Code of Corporate Governance, Head Office guidelines and all applicable
Malaysian laws; and
promoting an effective risk awareness culture where risk management is an integral aspect of the Groups
management systems.
36
ALAM MARITIM RESOURCES BERHAD (700849-K)
The Risk Management Team, headed by the Executive Director, Corporate Planning & Development and comprising Senior
Managers from all functions of the Group is entrusted to drive the Risk Management of the Group. The teams responsibilities
are to:
Risk Management is firmly embedded in the Groups management system and is every employees responsibility.
This report is made in accordance with a resolution of the Board of Directors dated 29 April 2011.
37
Annual Report 2010
The Board of Alam Maritim Resources Berhad (AMRB or the AMRB Group), is committed to seeing continuous
improvement in its business practices throughout the Group by applying the most part, if not all the governance principles
and recommended best practices as set out in the Revised 2007 Malaysian Code of Corporate Governance ["the
Code].The endeavour shall continue as the Board considers enhancement to the standard of corporate governance
practices of the Group is a continuous journey rather than a destination.
The Board of Directors is pleased to present herewith the Corporate Governance Statement (the CGS) to investors and
stakeholders of AMRB Group. The CGS outlines the major Corporate Governance principles and best practices applied by
AMRB Group throughout the financial year ended 31 December 2010 up to the date of the CGS. The CGS is prepared in
compliance with Para 15.25 of the Main Market Listing Requirements (MMLR) of Bursa Malaysia Securities Berhad.
DIRECTORS
The Board
The Board of AMRB is determined and committed with its responsibilities in governing, leading and monitoring the
direction of the Company towards achieving its mission and vision.
Board Balance
At present, AMRB Board consists of eight (8) members comprising five (5) Non Independent Executive Directors and
three (3) Independent Non-Executive Directors.
On 22 October 2010, AMRB welcomed the first independent lady director; Puan Fina Norhizah binti Haji Baharu Zaman
on board. She is a distinguished professional trained by MISC and Petronas. She filled the vacancy created by Y Bhg
Dato Mohamad Idris bin Mansor who left the Board on 28 April 2010 to re-join PETRONAS.
The Board strongly feels that gender diversity is a boon to the current mix of skills and experience that will further
enhance the Boards effectiveness in discharging its duties with more responsibilities, effectively and efficiently.
A brief profile of each Director is set out on page 24 to 27 of this Annual Report.
Appointments to the Board
The Nomination Committee is responsible to ensure that the prospective candidate has the required set of personal
qualities and competencies to carry out duties and responsibilities as a director. The incumbents professionalism,
integrity, skills and expertise must be seen to contribute and complement the Board existing strengths.
Accordingly, the appointment of Puan Fina Norhizah binti Haji Baharu Zaman to the Board in 2010 was recommended
by the Nomination Committee after going through a careful selection process led by the Chairman of the Nomination
Committee. It was the first appointment to Board since the Nomination Committee was established in 2006.
Board Responsibilities
At the strategic level of AMRB, clear division of responsibilities of the Chairman and the Managing Director/Chief
Executive Officer (MD/CEO) ensures the balance of power and authority, such that no one person has unfettered powers
of decision.
The Board as a whole is responsible in the achievement of the Companys long term strategic plans. In view of aligning
these corporate plans with current economic conditions and challenges, the Board consistently reviews the short term
and medium term performance on an annual basis.
The Board is accountable to the shareholders and it is committed to ensure that the Management; being vested with
delegated authority and powers by the Board, serves and function in the best interest of AMRBs stakeholders.
38
ALAM MARITIM RESOURCES BERHAD (700849-K)
There is also clear division of the Board and Management. At the Management level, there are various working
committees established specifically, HSE Steering and Working Committees, Management Committee, Group Risk
Management Working Committee, Credit Control Committee, Human Resources Policy Committee and Tender
Committee. These Committees meet regularly and as necessary to update knowledge with current information and
assess the effectiveness and efficiency of current policy, ensure implementation of new policies and procedures, and
continuously monitoring effectiveness and efficient running of the day to day management and operations of the Group
of Companies.
Board Meetings
The Board meets on a scheduled basis with at least five (5) times a year. During the financial year ended 31 December
2010, the Board has met six (6) times to deliberate and consider various strategic matters including review on quarterly
performance results, corporate plans and annual budget, risk assessment, debtors analysis and controls, new
investments proposals and other corporate matters.
The agenda of the meeting and the board papers and necessary information for the Board to deliberate in the meeting
is organized by the Company Secretary with consultation of the MD/CEO. The meeting agenda is prepared to take into
account the matters reserved for the Boards decisions. The Company Secretary arranged for the meeting pack to be
disseminated to the Board Members on a timely basis.
The Company Secretary records and keeps the minutes of meeting for the purpose of providing historical record and
insight into those decisions duly made.
The attendance of the Board members to the meetings held during the period under review is as follows:
Board Members
No of Meetings Attended
6/6
1/1
6/6
1/1
6/6
5/6
6/6
5/6
5/6
Notes:
*
resigned w.e.f 28.04.2010
** appointed w.e.f 22.10.2010
39
Annual Report 2010
Supply of Information
The Board has full and unlimited access to all information about the Groups business affairs, the advice and services
of the Senior Management and the Company Secretary. The Board may, if required, seek independent professional
advice at the Companys expense on specific issues to enable the Board to discharge its function in relation to the matter
being deliberated.
Prior to the Board meetings, all Board members are provided with the agenda and materials containing information
relevant to the business of the meeting to allow them to obtain further explanations, where necessary.
In dealing with the announcement and disclosures are to Bursa Malaysia Securities Berhad, the Boards prior approval
is required before any disclosure of such information to the public.
Re-election of Directors
Articles 94 of AMRBs Articles of Association provide that 1/3 of its directors shall retire from office at the annual general
meeting and be deemed eligible for re-election. The Article provides that each of them has to retire at least once in
every three (3) years rotation.
At the Sixth Annual General Meeting, Encik Shaharuddin Bin Warno @ Rahmad and Encik Ahmad Hassanudin Bin Ahmad
Kamaluddin shall retire and stand for re-election. Their profiles can be referred to on page 25 and 26, respectively of this
Annual Report.
Article 100 of AMRBs Articles of Association provides that Directors who are appointed by the Board during the financial
period before an AGM are subject to re-election by the shareholders at the next AGM to be held following
their appointments.
Therefore, at the Sixth AGM, Puan Fina Norhizah binti Haji Baharu Zaman is due for re-election. Her profile can be
referred to on page 27 of this Annual Report.
Directors Training
All the Board Members, including the newly appointed director Puan Fina Norhizah binti Haji Baharu Zaman have
successfully attended the Mandatory Accreditation Programme in compliance with the MMLR.
The Board had for the benefit of its new member arranged a special meeting to brief the new member regarding the
current affairs and strategies of the Company.
The Board is always mindful that continuing education is essential for them to keep abreast with changes and
developments in the market place and the corporate regulatory framework.
Hence, in January 2010 the Group successfully organized two in-house workshops attended by all the Board Members
and invited Management representatives. The workshops focused on Chapter 10 of Bursa Malaysia Main Listing
Requirements and FRS 139 of Malaysian Accounting Standard. The workshops were facilitated by trainers from Tricor
and a partner of Ernst & Young.
40
ALAM MARITIM RESOURCES BERHAD (700849-K)
Besides, some of the Board Members had attended the following training/workshops/seminars/professional public
courses tabulated herein for information:
No Director
Training/Workshop/Conference
Board Committees
In ensuring the effectiveness of the Boards function in shaping the Companys strategic direction and providing advice
to management, Board has delegated specific responsibilities to three (3) Boards Committees, namely Audit Committee,
Nomination & Remuneration Committee and Risk Management Committee.
These committees have clear defined terms of reference to operate and conduct broad and in depth deliberation on
issues before putting up recommendation to the Board.
The terms of reference of the Committees are as follows:
i.
ii.
To identify and recommend new nominees of the Board and recommend the compensation packages for
these appointments;
To assist the Board in reviewing the required mix of skills, experience and other qualities, including the
competencies which the non executive directors should bring to the Board;
to review, asses, determine and recommend the level and make-up of the overall remuneration packages of
the Executive Directors and the Senior Management with the assistance of the Group Human Resource
Department;
To carry out a process to assess the effectiveness of the Board as a whole by assessing the contribution of each
individual director, including independent non-executive directors, as well as the chief executive officer and
chief operating officer.
To document and report to the Board the result of assessment for the Boards proper evaluation and
identification of relevant action programmes.
41
Annual Report 2010
No of Meetings Attended
2/2
1/1
2/2
2/2
Note:
*
resigned w.e.f 28.04.2010
iii.
To ensure regular assessment, identification, measurement, and monitoring of all principal risks of the Group;
To coordinate and prioritise the Risk Management activities of the Group to ensure all principal risks are
adequately managed;
To ensure comprehensiveness enterprise-wide Risk Management policies and that a framework is in place
to provide a strong control environment;
To ensure the Groups Risk Management strategies are continuously aligned with its business strategies and
risk tolerance, whereby risks are considered in the Groups long term plans and investment or capital
allocations;
To ensure adequate resources, expertise, and information to manage risks are available throughout the Group;
and
To propagate a risk awareness culture among the Groups stakeholders, in particular all levels of staff within
the Group, by way of continuous risk training and education.
42
ALAM MARITIM RESOURCES BERHAD (700849-K)
No of Meetings Attended
1/1
2/2
2/2
Notes:
*
resigned w.e.f 28.04.201
**
appointed w.e.f 01.03.2010
*** appointed w.e.f 18.04.2011
With the vacancy in the chairmanship, the RMC relied on the Group Risk Management Working Committee
(GRMWC) to deliberate most of the corporate and operational risks of the Group. The GRMWC is chaired by
Encik Ahmad Hassanudin bin Ahmad Kamaluddin. Recently, to improve communication between the RMC and
GRMWC, the Board appointed Encik Ahmad Hassanudin bin Ahmad Kamaluddin as a member of the RMC. The RMC
shall be working closely and maintain effective communication with the GRMWC whilst sharing common principles
in dealing with risky opportunities.
iv.
To administer the ESOS and to grant Options in accordance with the Bye-laws;
To recommend to the Board to establish, amend, and revoke Byelaws, rules and regulations to facilitate the
implementation of the ESOS;
To construe and interpret the provisions hereof in the best interest of the Company; and
To exercise such powers and perform such acts as are deemed necessary or expedient to promote the best
interest of the Company.
43
Annual Report 2010
DIRECTORS REMUNERATION
The Level and Make-up of Remuneration
The determination of remuneration packages of the Directors is a matter for the Board as a whole. The remuneration
of Directors is structured to attract, motivate and retain them in order to run the Group successfully. At AMRB, the
rewards for Executive Directors, including CEO and COO are linked to both corporate and individual performance. On
the other hand, the level of remuneration for the Non-Executive Directors reflects functions and level of responsibilities
undertaken and contribution to the Group of companies.
Procedure
AMRB has remuneration packages for each director deliberated and approved by its Nomination & Remuneration
Committee prior to the recommendation to the Board. The remuneration packages of both Executive Directors and
Non-Executive Directors are drawn based on internal guidelines and benchmarked against the survey of remuneration
packages of other public listed companies in similar industry and within the same band of market capitalisation.
Disclosure
The Board reviews the remuneration of the Executive Directors annually whereby the respective Executive Directors
have abstained from discussions and decisions on their own remuneration.
44
ALAM MARITIM RESOURCES BERHAD (700849-K)
The aggregate remuneration of Directors for the financial year ended 31 December 2010 is as follows:Description
Executive Directors
Non-Executive Directors
Total
2,247,000
2,247,000
Contribution to EPF
295,830
295,830
Bonus
730,200
730,200
170,965
170,965
Allowances
300,000
61,000
361,000
450,427
91,928
542,355
Benefit in Kind
98,500
15,000
113,500
4,368,922
338,893
4,460,850
Executive
Non-Executive
Fees
Total
2**
RM50,001 - RM100,000
RM100,001 RM200,000
RM500,001- RM550,00
RM650,001 RM700,000
Notes:
*
Excluding the share option benefit
**
Directors served the Board partly during the financial year ended 2010.
One of the Executive Directors was on sabbatical leave.
45
Annual Report 2010
SHAREHOLDERS
Dialogue between Companies and Investors
The Group recognizes the importance of effective communication with its shareholders, other stakeholders and potential
investors to keep them informed of the major development of the Group. Such information is disseminated through the
following channels:-
The Company and Institutional shareholders often, represented by their respective fund managers have dialogues with
regards to the mutual understanding of AMRBs corporate and business objectives.
The AGM
The Company establishes that AGM should be the main platform for investors to raise questions pertaining to the
operations and financials of the Group.
Although the AGM is an occasion for shareholders, the Chairman had during the Fifth AGM in 2010 allowed
representatives of the media to be present. The previous AGM was also attended by the representative from Minority
Shareholders Watchdog Group.
46
ALAM MARITIM RESOURCES BERHAD (700849-K)
The internal control system of the Group is supported by an established organizational structure with well-defined
authority and responsibility lines, and which comprises of appropriate financial, operational and compliance controls.
Statement of Directors Responsibility
The Directors are required by the Companies Act 1965 to prepare financial statements for each financial year, which give
a true and fair view of the state of affairs of the Group and the Company and of the results and cash flow of the Group
and the Company for the financial year then ended.
In preparing the financial statements for the year ended 31 December 2009, the Directors have:
Ensure that applicable, approved accounting standards have been followed, and any material departures have been
disclosed and explained in the financial statements; and
Ensure the financial statement have been prepared on a going concern basis
The Directors are responsible for keeping proper accounting records of the Group and Company, which disclose with
reasonable accuracy the financial position of the Group and the Company, and which will enable them to ensure the
financial statements have complied with the provisions of the Companies Act 1965 and the applicable, approved
accounting standards in Malaysia.
The Directors have the general responsibility for taking such steps that s are reasonably open to them to safeguard the
assets of the Group and to prevent and detect fraud and other irregularities.
Compliance Statement
The Board of AMRB is generally satisfied with the Groups level of compliance with the principles in Part 1 of the Code
and the extent to which the best practices in Part 2 of the Code is applied by the Group.
Other Disclosure Requirements
Besides the overview of the state of corporate governance in the Company, the Board is pleased to disclose the following
information:
Share Buybacks
During the financial year, there were no share buybacks by the Company.
Options, warrants or Convertible Securities
A total of 19,925,513 units of ESOS Options were exercised for the financial year ended 31 December 2010.
American Depository Receipt (ADR) or Global Depository Receipt (GDR) Programme
During the financial year, the Company did not sponsor any ADR or GDR Programme.
47
Annual Report 2010
Imposition of Sanctions/Penalties
There were no public sanctions and/or penalties imposed on the Company or its subsidiaries, Directors or management
by the relevant regulatory bodies during the financial year.
Non-Audit Fees
There were no non-audit fees paid to the external auditors during the financial year.
Variation in Results
The Group announced more than 10 percent deviation between the total comprehensive loss attributable to owners of
the parent stated in the Unaudited Fourth Quarter Financial Statements announced on 28 February 2011 and the Audited
Financial Statements for the financial year ended 31 December 2010 announced on 29 April 2011.
The reasons for this deviation were disclosed in an announcement through Bursa Malaysia Securities Berhad dated
29 April 2011.
Material Contracts
There were no material contracts entered into by the Company and/or its subsidiaries involving directors and major
shareholders interest either subsisting as at 31 December 2010 or entered into during the financial period under review.
48
ALAM MARITIM RESOURCES BERHAD (700849-K)
RESPONSIBILITY
The Board of Directors recognises the importance of sound internal controls and risk management practices to good
corporate governance. The Board affirms its overall responsibility for the Groups system of internal control which includes
the establishment of an appropriate control environment and framework as well as reviewing its adequacy and integrity. As
there are limitations that are inherent in any system of internal control, this system is designed to manage rather than
eliminate risks that may impede the achievement of the Groups business objectives. Accordingly, it can only provide
reasonable but not absolute assurance against material misstatement or loss.
The Group has in place an on-going process for identifying, evaluating, monitoring and managing significant risks faced by
the Group and this process includes reviewing and updating the system of internal controls to take into consideration changes
in the regulatory and business environment. This process is regularly reviewed by the Board via the Audit Committee and
accords with the Statement on Internal Control: Guidance for Directors of Public Listed Companies.
The Board ensures that management undertakes such actions as may be necessary in the implementation of the policies and
procedures on risk and control approved by the Board whereby management identifies and assesses the risk faced and then
designs, implements and monitors appropriate internal controls to mitigate and control those risks.
RISK MANAGEMENT
Risk management is regarded by the Board of Directors to be an integral part of the business operations. Management is
responsible for creating a risk awareness culture and for building the necessary knowledge for risk management. They also
have the responsibility for managing risks and internal control associated with the operations and ensuring compliance with
applicable laws and regulations.
The main underlying principles of the Groups policy are:
Operating structure with clearly defined lines of responsibility and delegated authority
The operating structure includes defined delegation of responsibilities to the committees of the Board and the
management team.
The Audit Committee comprises non-executive members of the Board, where all members being independent.
The Committee has full access to both Internal and External Auditors and it meets with the External Auditors
without any executive present at least twice a year.
49
Annual Report 2010
(c)
Clearly defined delegation of responsibilities to committees of the Board and to management including organisation
structures and appropriate authority levels; and
Clearly documented internal policies, standards and procedures are in place and regularly updated to reflect
changing risks or resolve operational deficiencies. All policies and standards are approved by the Board and cases
of non-compliance are reported to the Board by exception.
Regular and comprehensive information provided by management for monitoring of performance against strategic
plan, covering all key financial and operational indicators. On a quarterly basis, the Managing Director reviews
with the Board on all issues covering, but not restricted to, strategy, performance, resources and standards of
business conduct;
Detailed budgeting process established requiring all business units to prepare budgets annually which are
discussed and approved by the Board; and
Effective reporting systems which expose significant variances against budgets and plan are in place to monitor
performance. Key variances are followed up by management and reported to the Board.
(f)
Adequate insurance and physical safeguard on major assets in place to ensure that the assets of the Group are
sufficiently covered against any mishap that will result in material losses to the Group.
Senior Management Team meetings are held on a regular basis to review, identify, discuss and resolve strategic,
operational, financial and key management issues.
Regular meetings are held between the Managing Director/CEO and analysts with a formal presentation conducted
on the day the financial results are released after Boards approval to ensure a transparent relationship and open
dialogue with investors and shareholders; and
Written declaration from all management personnel confirming their compliance with the Groups Policies and
Authorities and where conflicts of interest situations are disclosed.
50
ALAM MARITIM RESOURCES BERHAD (700849-K)
FINANCIAL
STATEMENTS
52
58
61
70
Directors' Report
The directors hereby present their report together with the audited financial statements of the Group and of the Company for
the financial year ended 31 December 2010.
Principal activities
The principal activity of the Company is investment holding. The principal activities of the subsidiaries are disclosed in Note
15 to the financial statements.
There have been no significant changes in the nature of the principal activities of the Group and of the Company during the
financial year.
Results
Group
RM
Company
RM
(12,948,905)
( 100,192)
Attributable to:
Equity holders of the Company
Minority interests
(13,917,996)
969,091
(100,192)
-
(12,948,905)
(100,192)
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 2009 were as follows:
RM
In respect of the financial year ended 31 December 2009, as reported in the
directors' report of that year:
First and final dividend of 0.75 sen per share less 25% taxation
on 506,987,098 shares, paid on 8 July 2010
The directors do not propose the payment of any dividend in respect of the current financial year.
52
ALAM MARITIM RESOURCES BERHAD (700849-K)
2,860,186
Directors' Report
(contd.)
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:
Dato' Captain Ahmad Sufian @ Qurnain bin Abdul Rashid
Dato' Haji Ab Wahab bin Haji Ibrahim
Azmi bin Ahmad
Shaharuddin bin Warno @ Rahmad
Mohd Abd Rahman bin Mohd Hashim
Ab Razak bin Hashim
Ahmad Hassanudin bin Ahmad Kamaluddin
Dato' Mohamad Idris bin Mansor
Fina Norhizah binti Hj Baharu Zaman
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 acquisition of shares in or debentures of the
Company or any other body corporate other than those arising from the share options granted under the Company's Employee
Share Options Scheme.
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 or the fixed salary
of a full-time employee of the Company, as shown in Note 6 to the financial statements) 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.
Directors' interests
According to the register of directors' shareholdings, the interests of directors in office at the end of the financial year in
shares and options over shares in the Company and its related corporations during the financial year were as follows:
At 1.1.2010
The Company
Direct interest:
Dato' Captain Ahmad Sufian
@ Qurnain bin Abdul Rashid
Dato' Haji Ab Wahab bin Haji Ibrahim
Azmi bin Ahmad
Shaharuddin bin Warno @ Rahmad
Mohd Abd Rahman bin Mohd Hashim
Ab Razak bin Hashim
Ahmad Hassanudin bin
Ahmad Kamaluddin
200,000
1,000
179,474
3,676,999
75
100,000
500
11,087
338,499
37
100,000
577,500
2,837,176
3,357,500
(100,000)
(577,500)
(157,300)
(3,000,000)
(2,137,176)
-
300,000
1,500
33,261
1,015,498
700,000
3,357,612
1,250
625
1,732,500
(1,732,500)
1,875
53
Annual Report 2010
Directors' Report
(contd.)
At 1.1.2010
Indirect interest:
Dato' Captain Ahmad Sufian
@ Qurnain bin Abdul Rashid
Azmi bin Ahmad
Shaharuddin bin Warno @ Rahmad
Mohd Abd Rahman bin Mohd Hashim
Ab Razak bin Hashim
Ahmad Hassanudin bin
Ahmad Kamaluddin
255,171,640
254,778,090
254,778,090
254,778,090
127,465,920
127,389,045
127,389,045
127,389,045
20,000
-
(239,800)
-
20,000
382,397,760
382,167,135
382,167,135
382,167,135
82,500
41,250
123,750
481,250
385,000
5,358,925
2,206,600
4,098,051
2,206,601
240,625
192,500
2,679,462
1,103,300
2,049,025
1,103,300
(577,500)
(2,837,176)
(3,309,901)
721,875
8,038,387
3,309,900
3,309,900
-
1,155,000
577,500
(1,732,500)
Issue of shares
During the financial year, the Company increased its issued and paid-up ordinary share capital from RM126,746,775 to
RM195,287,594 by way of:
(a)
(b)
Ordinary shares issued pursuant to the Company's Employee Share Options Scheme
During the financial year, the Company issued 19,925,463 (2009: 14,141,112) ordinary shares of RM0.25 each for cash
pursuant to the Company's Employee Share Options Scheme at the exercise price ranging from RM0.44 to RM1.40 (2009:
RM0.60 to RM1.59) per ordinary share.
The new ordinary shares issued during the financial year ranked pari passu in all respects with the existing ordinary shares
of the Company.
54
ALAM MARITIM RESOURCES BERHAD (700849-K)
Directors' Report
(contd.)
(b)
Before the statements of comprehensive income and statements of financial position 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 provision
for doubtful debts and satisfied themselves that there were no known bad debts and that adequate provision 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.
At the date of this report, the directors are not aware of any circumstances which would render:
(i)
it necessary to write off any bad debts or the amount of the provision 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 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.
(e)
(f)
(i)
any charge on the assets of the Group and 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.
no contingent or other liability has become enforceable or is likely to become enforceable within the period of
twelve 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.
55
Annual Report 2010
Directors' Report
(contd.)
Significant events
In addition to the significant events disclosed elsewhere in this report, other significant events are disclosed in Note 15, Note
16 and Note 17 to the financial statements.
Subsequent event
Details of subsequent event are disclosed in Note 40 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 dated 29 April 2011.
56
ALAM MARITIM RESOURCES BERHAD (700849-K)
Statement by Directors
Pursuant to Section 169(15) of the Companies Act, 1965
We, Dato' Captain Ahmad Sufian @ Qurnain bin Abdul Rashid and Azmi bin Ahmad, being two of the directors of Alam Maritim
Resources Berhad, do hereby state that, in our opinion, the accompanying financial statements set out on pages 60 to 135
are drawn up in accordance with the applicable Financial Reporting Standards and provisions of the Companies Act, 1965 in
Malaysia so as to give a true and fair view of the financial position of the Group and of the Company as at 31 December 2010
and of the results and the cash flows of the Group and of the Company for the year then ended.
The information set out in Note 42 to the financial statements have been prepared in accordance with the Guidance on Special
Matter No.1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa
Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants.
Signed on behalf of the Board in accordance with a resolution of the directors dated 29 April 2011.
Statutory Declaration
Pursuant to Section 169(16) of the Companies Act, 1965
I, Md Nasir bin Noh, being the officer primarily responsible for the financial management of Alam Maritim Resources Berhad,
do solemnly and sincerely declare that the accompanying financial statements set out on pages 60 to 135 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.
Before me,
57
Annual Report 2010
Auditors responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in
accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from
material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on our judgment, including the assessment of risks of material misstatement
of the financial statements, whether due to fraud or error. In making those risk assessments, we consider internal control
relevant to the Companys preparation and fair presentation of the financial statements in order to design audit procedures
that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
Companys internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the
reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the estimates
made by the directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for audit opinion.
Opinion
In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and
the Companies Act, 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company
as at 31 December 2010 and of their financial performance and cash flows for the year then ended.
In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and
its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act.
(b)
We have considered the accounts and the auditors' report of all the subsidiaries of which we have not acted as auditors,
which are indicated in Note 15 to the financial statements.
(c)
We are satisfied that the accounts 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.
(d)
The auditors reports on the accounts of the subsidiaries were not subject to any qualification and did not include any
comment required to be made under Section 174(3) of the Act.
58
ALAM MARITIM RESOURCES BERHAD (700849-K)
Other matters
The supplementary information set out in Note 42 on page 135 is disclosed to meet the requirement of Bursa Malaysia
Securities Berhad. The directors are responsible for the preparation of the supplementary information in accordance with
Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or Losses in the Context of Disclosure
Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the Malaysian Institute of Accountants
("MIA Guidance") and the directive of Bursa Malaysia Securities Berhad. In our opinion, the supplementary information is
prepared, in all material respects, in accordance with the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.
This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act,
1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.
59
Annual Report 2010
Group
Note
Revenue
Cost of sales
2009
RM
2010
RM
2009
RM
1,713,250
-
242,191,823
(158,145,033)
348,917,132
(194,929,687)
84,046,790
5,318,479
(22,318,241)
(65,985,339)
153,987,445
7,631,583
(24,646,486)
(25,068,072)
995,220
(168,804)
(751,320)
1,713,250
988,642
(242,828)
(520,073)
1,061,689
(31,228,729)
111,904,470
(25,874,837)
75,096
(7,942)
1,938,991
(9,466)
12,347,733
(296,299)
23,211,091
3,283,674
(18,115,606)
5,166,701
112,524,398
(17,157,646)
67,154
(167,346)
1,929,525
(292,478)
(12,948,905)
95,366,752
(100,192)
1,637,047
(155,775)
144,791
(13,104,680)
95,511,543
(100,192)
1,637,047
(13,917,996)
969,091
91,279,940
4,086,812
(100,192)
-
1,637,047
-
(12,948,905)
95,366,752
(100,192)
1,637,047
(14,061,240)
956,560
91,381,490
4,130,053
(100,192)
-
1,637,047
-
(13,104,680)
95,511,543
(100,192)
1,637,047
(2.2)
(2.1)
18.3
17.6
Gross profit
Other income
Employee benefits expense
Other expenses
Operating (loss)/profit
Finance costs
Share of results
of jointly controlled entities
Share of results of associates
(Loss)/profit before tax
Income tax benefit/ (expense)
Company
2010
RM
8
9
10
10
As at
1.1.2009
(restated)
RM
2010
RM
2009
(restated)
RM
680,229,793
1,691,092
54,907,200
80,680,904
11,567,361
788,815,762
1,850,173
22,225,947
45,600,714
10,094,886
817,699,175
1,949,538
21,667,949
25,547,737
8,797,351
829,076,350
868,587,482
875,661,750
8,507,084
117,434,537
169,307,894
4,454,598
167,010,472
23,362,915
150,689,419
115,547,226
3,183,093
193,045,345
19,985,209
199,584,982
46,568,165
2,688,782
112,791,305
466,714,585
485,827,998
381,618,443
1,295,790,935
1,354,415,480
1,257,280,193
233,849,190
28,624,547
51,756,326
2,945,324
157,129,155
28,925,886
117,047,107
3,723,530
147,091,902
39,045,143
134,880,729
1,687,866
317,175,387
306,825,678
322,705,640
149,539,198
179,002,320
58,912,803
435,164,780
70,945,539
486,316,442
77,511,121
487,982,161
66,396,703
506,110,319
563,827,563
554,378,864
Total liabilities
823,285,706
870,653,241
877,084,504
Net assets
472,505,229
483,762,239
380,195,689
Group
Note
Assets
Non-current assets
Property, vessels and equipment
Land use rights
Intangible assets
Investment in associates
Investments in jointly controlled entities
Deposits with a licensed bank
12
13
14
16
17
23
Current assets
Inventories
Trade receivables
Other receivables
Tax recoverable
Cash and bank balances
19
20
22
23
Total assets
27
30
31
27
29
61
Annual Report 2010
2009
(restated)
RM
As at
1.1.2009
(restated)
RM
195,287,595
22,629,064
(1,033,358)
248,141,190
126,746,775
78,470,938
6,785,533
264,469,513
123,211,497
68,689,027
7,968,503
174,996,808
Minority interests
465,024,491
7,480,738
476,472,759
7,289,480
374,865,835
5,329,854
Total equity
472,505,229
483,762,239
380,195,689
1,295,790,935
1,354,415,480
1,257,280,193
Note
2010
RM
2009
RM
12
15
37,057
100,302,070
92,642
100,302,070
100,339,127
100,394,712
616,067,346
3,120
1,392,178
88,319,606
623,912,236
2,468,139
77,001,774
705,782,250
703,382,149
806,121,377
803,776,861
176,948,917
11,357,527
126,789,886
11,718,192
188,306,444
138,508,078
517,475,806
564,874,071
Group
2010
RM
Note
24
24
25
26
Company
Assets
Non-current assets
Motor vehicle
Investment in subsidiaries
Current assets
Due from subsidiaries
Due from related corporations
Tax recoverable
Cash and bank balances
18
22
23
Total assets
27
31
62
ALAM MARITIM RESOURCES BERHAD (700849-K)
Note
2010
RM
2009
RM
27
390,116,754
445,145,042
Total liabilities
578,423,198
583,653,120
Net assets
227,698,179
220,123,741
195,287,595
22,629,064
4,448,996
5,332,524
126,746,775
78,470,938
6,613,126
8,292,902
Total equity
227,698,179
220,123,741
806,121,377
803,776,861
Company
Non-current liabilities
Borrowings
24
24
25
26
64
At 31 December 2010
At 1 January 2010
Group
195,287,595
22,629,064
(55,841,874)
2,683,597
-
68,540,820
5,033,983
(63,559,454)
78,470,938
4,981,366
63,559,454
126,746,775
Share
capital
(Note 24)
RM
(1,033,358)
(7,675,647)
(5,511,517)
-
519,467
(2,683,597)
-
(143,244)
6,785,533
248,141,190
(2,410,327)
449,859
(2,860,186)
(13,917,996)
264,469,513
465,024,491
2,612,972
(5,511,517)
449,859
519,467
(2,860,186)
10,015,349
-
(14,061,240)
476,472,759
RM
Total
7,480,738
(765,302)
(449,859)
472,505,229
1,847,670
(5,511,517)
-
(315,443)
(2,860,186)
(315,443)
519,467
10,015,349
-
(13,104,680)
483,762,239
RM
Total
equity
956,560
7,289,480
RM
Minority
interests
65
At 31 December 2009
At 1 January 2009
Group (contd.)
126,746,775
78,470,938
9,781,911
3,586,668
-
3,535,278
6,195,243
68,689,027
3,535,278
123,211,497
Share
capital
(Note 24)
RM
6,785,533
(1,284,520)
2,302,148
(3,586,668)
-
101,550
7,968,503
264,469,513
(1,807,235)
(1,875,480)
68,245
91,279,940
174,996,808
476,472,759
10,225,434
2,302,148
(1,875,480)
68,245
9,730,521
91,381,490
374,865,835
RM
Total
7,289,480
(2,170,427)
(2,102,182)
(68,245)
4,130,053
5,329,854
RM
Minority
interests
483,762,239
8,055,007
2,302,148
(3,977,622)
-
9,730,521
95,511,543
380,195,689
RM
Total
equity
66
At 31 December 2010
At 1 January 2010
Company
195,287,595
22,629,064
(55,841,874)
2,683,597
-
68,540,820
5,033,983
(63,559,454)
78,470,938
Non-distributable
Share
premium
(Note 24)
RM
4,981,366
63,559,454
126,746,775
Share
capital
(Note 24)
RM
4,448,996
(2,164,130)
519,467
(2,683,597)
-
6,613,126
Other
reserves
(Note 25)
RM
5,332,524
(2,860,186)
(2,860,186)
(100,192)
8,292,902
Distributable
Retained
profits
(Note 26)
RM
227,698,179
7,674,630
519,467
(2,860,186)
10,015,349
-
(100,192)
220,123,741
Total
equity
RM
67
At 1 January 2009
At 31 December 2009
126,746,775
78,470,938
9,781,911
3,586,668
-
3,535,278
6,195,243
68,689,027
Non-distributable
Share
premium
(Note 24)
RM
3,535,278
123,211,497
Company (contd.)
Share
capital
(Note 24)
RM
6,613,126
(1,284,520)
2,302,148
(3,586,668)
-
7,897,646
Other
reserves
(Note 25)
RM
8,292,902
(1,875,480)
(1,875,480)
1,637,047
8,531,335
Distributable
Retained
profits
(Note 26)
RM
220,123,741
10,157,189
2,302,148
(1,875,480)
9,730,521
1,637,047
208,329,505
Total
equity
RM
Group
2010
RM
Operating activities
(Loss)/profit before tax
Adjustments for:
Interest income
Dividend income
Depreciation of property,
vessels and equipment (Note 12)
Loss/(gain) on disposal of property, vessels
and equipment
Unrealised (loss)/profit
on vessels disposed to associates
Property, vessels and equipment written off
Finance costs
Share options granted under ESOS (Note 5)
Bad debts written off
Impairment loss on
trade receivables
Impairment loss on
trade receivables written off
Net foreign exchange losses
Amortisation of intangible assets
Share of loss/(profit) of associates
Share of profit of jointly controlled entities
(18,115,606)
Company
2009
RM
2010
RM
2009
RM
112,524,398
67,154
1,929,525
(988,642)
(1,713,250)
(2,233,050)
-
(2,976,348)
-
(995,220)
-
34,069,546
31,890,538
55,585
55,586
1,074,360
(5,409,340)
(960,903)
31,228,729
519,467
1,005,763
2,572,411
429,696
25,874,837
2,302,148
-
7,942
-
9,466
91,928
-
28,020,284
9,035,533
(121,692)
4,405,058
119,335
296,299
(12,347,733)
4,576,266
122,260
(3,283,674)
(23,211,091)
66,959,857
154,447,634
(864,539)
(615,387)
14,855,831
(53,310,707)
(65,592,120)
(3,377,706)
(30,533,684)
(27,952,879)
(360,665)
85,752
(37,087,139)
1,340,920
(4,635,426)
(30,037,119)
92,583,365
(4,543,897)
(27,370,446)
(1,225,204)
1,340,920
(432,305)
(28,019,000)
(529,635)
(1,594,170)
(24,334,071)
(70,418,764)
60,669,022
(28,335,589)
(26,457,876)
68
ALAM MARITIM RESOURCES BERHAD (700849-K)
Group
2010
RM
Company
2009
RM
2010
RM
2009
RM
Investing activities
Purchase of property, vessels
and equipment (Note 12)
Prepayment of land lease
Acquisition of minority interests (Note 15(a)(i))
Investment in jointly controlled entities
Investment in associates
Decrease in amount due from subsidiaries
Interest received
(171,570,033)
(5,826,960)
(22,732,457)
(32,016,649)
2,233,050
(95,042,684)
(10,062,360)
(352)
2,976,348
40,667,089
995,220
60,404,157
988,642
(229,913,049)
(102,129,048)
41,662,309
61,392,799
254,150,360
7,513,556
10,015,349
95,862,712
(100,000,000)
124,646,000
9,730,521
95,661,918
(100,000,000)
10,015,349
95,862,712
(100,000,000)
11,940,741
95,661,918
(100,000,000)
Financing activities
Proceeds from disposal of vessels to associates
Proceeds from disposal of diving equipment
Proceeds from issuance of ordinary shares (Note 24)
Proceeds from MCP/MMTN
Repayment of MCP/MMTN
Proceeds from Sukuk
Ijarah MTN
Redemption of Sukuk
Ijarah MTN
Proceeds from drawdown of term loans
Repayment of term loans
Proceeds from drawdown of revolving credits
Repayment of hire purchase and
lease financing (Note 28)
Net cash set aside for
collateral and sinking fund
Dividends paid
Net cash generated from/ (used in)
financing activities
25,000,000
25,000,000
(30,000,000)
6,296,624
(8,045,078)
20,000,000
(20,000,000)
22,203,376
(2,030,554)
-
(30,000,000)
-
(20,000,000)
-
(4,873,887)
(749,063)
(26,763)
(25,237)
(1,613,321)
(2,860,186)
(2,642,263)
(3,977,662)
(2,860,186)
(1,875,480)
271,446,129
122,842,273
(2,008,888)
(14,298,058)
Net (decrease)/increase
in cash and cash equivalents
Cash and cash equivalents at
beginning of year
(28,885,684)
81,382,247
11,317,832
20,636,865
187,207,104
105,824,857
77,001,774
56,364,909
158,321,420
187,207,104
88,319,606
77,001,774
1.
Corporate information
The Company is a public limited liability company, incorporated and domiciled in Malaysia, and is listed on the Main
Market of Bursa Malaysia Securities Berhad. The registered office is located at 38F, Level 3, Jalan Radin Anum, Bandar
Baru Sri Petaling, 57000 Kuala Lumpur.
The immediate and ultimate holding company of the Company is SAR Venture Holdings (M) Sdn. Bhd., a private limited
liability company, incorporated and domiciled in Malaysia.
The principal activity of the Company is investment holding. The principal activities of the subsidiaries are disclosed in
Note 15 to the financial statements.
There have been no significant changes in the nature of the principal activities of the Company and of its subsidiaries
during the financial year.
The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the
directors on 29 April 2011.
2.
70
ALAM MARITIM RESOURCES BERHAD (700849-K)
2.
71
Annual Report 2010
2.
10,052,363
(10,052,363)
Adjustments
RM
As restated
RM
778,763,399
10,052,363
10,052,363
(10,052,363)
788,815,762
-
72
ALAM MARITIM RESOURCES BERHAD (700849-K)
2.
Description
FRS 1 First-time Adoption of Financial Reporting Standards
FRS 3 Business Combinations (revised)
Amendments to FRS 2 Share-based Payment
Amendments to FRS 5 Non-current Assets Held for Sale and Discontinued Operations
Amendments to FRS 127 Consolidated and Separate Financial Statements
Amendments to FRS 138 Intangible Assets
Amendments to IC Interpretation 9 Reassessment of Embedded Derivatives
IC Interpretation 12 Service Concession Arrangements
IC Interpretation 15 Agreements for the Construction of Real Estate
IC Interpretation 16 Hedges of a Net Investment in a Foreign Operation
IC Interpretation 17 Distributions of Non-cash Assets to Owners
Amendments to FRS 132 Classification of Rights Issues
Amendments to FRS 1 Limited Exemption from Comparative
FRS 7 Disclosures for First-time Adopters
Amendments to FRS 7 Improving Disclosures about Financial Instruments
1 July 2010
1 July 2010
1 July 2010
1 July 2010
1 July 2010
1 July 2010
1 July 2010
1 July 2010
1 July 2010
1 July 2010
1 July 2010
1 March 2010
1 January 2011
1 January 2011
Except for the changes in accounting policies arising from the adoption of the revised FRS 3 and the amendments
to FRS 127, as well as the new disclosures required under the Amendments to FRS 7, the directors expect that the
adoption of the other standards and interpretations above will have no material impact on the financial statements
in the period of initial application. The nature of the impending changes in accounting policy on adoption of the
revised FRS 3 and the amendments to FRS 127 are described below.
Revised FRS 3 Business Combinations and Amendments to FRS 127 Consolidated and Separate Financial Statements
The revised standards are effective for annual periods beginning on or after 1 July 2010. The revised FRS 3 introduces a
number of changes in the accounting for business combinations occurring after 1 July 2010. These changes will impact
the amount of goodwill recognised, the reported results in the period that an acquisition occurs, and future reported
results. The Amendments to FRS 127 require that a change in the ownership interest of a subsidiary (without loss of
control) is accounted for as an equity transaction. Therefore, such transactions will no longer give rise to goodwill, nor will
they give rise to a gain or loss. Furthermore, the amended standard changes the accounting for losses incurred by the
subsidiary as well as the loss of control of a subsidiary. Other consequential amendments have been made to FRS 107
Statement of Cash Flows, FRS 112 Income Taxes, FRS 121 The Effects of Changes in Foreign Exchange Rates, FRS 128
Investments in Associates and FRS 131 Interests in Joint Ventures. The changes from revised FRS 3 and Amendments
to FRS 127 will affect future acquisitions or loss of control and transactions with minority interests. The standards may
be early adopted. However, the Group does not intend to early adopt.
73
Annual Report 2010
2.
74
ALAM MARITIM RESOURCES BERHAD (700849-K)
2.
Foreign operations
The assets and liabilities of foreign operations are translated into RM at the rate of exchange ruling at the
reporting date and income and expenses are translated at exchange rates at the dates of the transactions. The
exchange differences arising on the translation are taken directly to other comprehensive income. On disposal
of a foreign operation, the cumulative amount recognised in other comprehensive income and accumulated
in equity under foreign currency translation reserve relating to that particular foreign operation is recognised
in the profit or loss.
Goodwill and fair value adjustments arising on the acquisition of foreign operations are treated as assets and
liabilities of the foreign operations and are recorded in the functional currency of the foreign operations and
translated at the closing rate at the reporting date.
75
Annual Report 2010
2.
2 - 3%
10%
10%
33.3%
10%
10%
10%
20%
The residual values, useful life and depreciation method are reviewed at each financial year-end to ensure that the
amount, method and period of depreciation are consistent with previous estimates and the expected pattern of
consumption of the future economic benefits embodied in the items of property, vessels and equipment.
An item of property, vessels and equipment is derecognised upon disposal or when no future economic benefits
are expected from its use or disposal. The difference between the net disposal proceeds, if any and the net carrying
amount is recognised in profit or loss.
2.8 Intangible assets
(a)
Goodwill
Goodwill acquired in a business combination is initially measured at cost being the excess of the cost of
business combination over the Groups interest in the net fair value of the identifiable assets, liabilities and
contingent liabilities. Following the initial recognition, goodwill is measured at cost less any accumulated
impairment losses. Goodwill is not amortised but instead, it is reviewed for impairment, annually or more
frequently if events or changes in circumstances indicate that the carrying value may be impaired. Gains and
losses on the disposal of an entity include the carrying amount of goodwill relating to the entity sold.
76
ALAM MARITIM RESOURCES BERHAD (700849-K)
2.
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Annual Report 2010
2.
78
ALAM MARITIM RESOURCES BERHAD (700849-K)
2.
79
Annual Report 2010
2.
Held-to-maturity investments
Financial assets with fixed or determinable payments and fixed maturity are classified as held-to-maturity
when the Group has the positive intention and ability to hold the investment to maturity.
Subsequent to initial recognition, held-to-maturity investments are measured at amortised cost using the
effective interest method. Gains and losses are recognised in profit or loss when the held-to-maturity
investments are derecognised or impaired, and through the amortisation process.
Held-to-maturity investments are classified as non-current assets, except for those having maturity within 12
months after the reporting date which are classified as current.
The Group and the Company do not have any held-to-maturity investments during the year ended 31
December 2010.
80
ALAM MARITIM RESOURCES BERHAD (700849-K)
2.
Trade and other receivables and other financial assets carried at amortised cost
To determine whether there is objective evidence that an impairment loss on financial assets has been
incurred, the Group and the Company consider factors such as the probability of insolvency or significant
financial difficulties of the debtor and default or significant delay in payments. For certain categories of
financial assets, such as trade receivables, assets that are assessed not to be impaired individually are
subsequently assessed for impairment on a collective basis based on similar risk characteristics. Objective
evidence of impairment for a portfolio of receivables could include the Groups and the Company's past
experience of collecting payments, an increase in the number of delayed payments in the portfolio past the
average credit period and observable changes in national or local economic conditions that correlate with
default on receivables.
If any such evidence exists, the amount of impairment loss is measured as the difference between the assets
carrying amount and the present value of estimated future cash flows discounted at the financial assets
original effective interest rate. The impairment loss is recognised in profit or loss.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets
with the exception of trade receivables, where the carrying amount is reduced through the use of an allowance
account. When a trade receivable becomes uncollectible, it is written off against the allowance account.
If in a subsequent period, the amount of the impairment loss decreases and the decrease can be related
objectively to an event occurring after the impairment was recognised, the previously recognised impairment
loss is reversed to the extent that the carrying amount of the asset does not exceed its amortised cost at the
reversal date. The amount of reversal is recognised in profit or loss.
81
Annual Report 2010
2.
82
ALAM MARITIM RESOURCES BERHAD (700849-K)
2.
83
Annual Report 2010
2.
84
ALAM MARITIM RESOURCES BERHAD (700849-K)
2.
As lessee
Finance leases, which transfer to the Group substantially all the risks and rewards incidental to ownership of
the leased item, are capitalised at the inception of the lease at the fair value of the leased asset or, if lower,
at the present value of the minimum lease payments. Any initial direct costs are also added to the amount
capitalised. Lease payments are apportioned between the finance charges and reduction of the lease liability
so as to achieve a constant rate of interest on the remaining balance of the liability. Finance charges are
charged to profit or loss. Contingent rents, if any, are charged as expenses in the periods in which they
are incurred.
Leased assets are depreciated over the estimated useful life of the asset. However, if there is no reasonable
certainty that the Group will obtain ownership by the end of the lease term, the asset is depreciated over the
shorter of the estimated useful life and the lease term.
Operating lease payments are recognised as an expense in profit or loss on a straight-line basis over the
lease term. The aggregate benefit of incentives provided by the lessor is recognised as a reduction of rental
expense over the lease term on a straight-line basis.
(b) As lessor
Leases where the Group retains substantially all the risks and rewards of ownership of the asset are classified
as operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying
amount of the leased asset and recognised over the lease term on the same bases as rental income. The
accounting policy for rental income is set out in Note 2.25(a).
2.25 Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the
revenue can be reliably measured. The following specific recognition criteria must also be met before revenue
is recognised:
(a)
85
Annual Report 2010
2.
Interest income
Interest income is recognised on an accrual basis using the effective interest method.
Current tax
Current tax assets and liabilities are measured at the amount expected to be recovered from or paid to the
taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or
substantively enacted by the reporting date.
Current taxes are recognised in profit or loss except to the extent that the tax relates to items recognised
outside profit or loss, either in other comprehensive income or directly in equity.
where the deferred tax liability arises from the initial recognition of goodwill or of an asset or liability in
a transaction that is not a business combination and, at the time of the transaction, affects neither the
accounting profit nor taxable profit or loss; and
in respect of taxable temporary differences associated with investments in subsidiaries, associates and
interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled
and it is probable that the temporary differences will not reverse in the foreseeable future.
Deferred tax assets are recognised for all deductible temporary differences, carry forward of unused tax
credits and unused tax losses, to the extent that it is probable that taxable profit will be available against
which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses
can be utilised except:
-
where the deferred tax asset relating to the deductible temporary difference arises from the initial
recognition of an asset or liability in a transaction that is not a business combination and, at the time of
the transaction, affects neither the accounting profit nor taxable profit or loss; and
86
ALAM MARITIM RESOURCES BERHAD (700849-K)
2.
Sales tax
Revenues, expenses and assets are recognised net of the amount of sales tax except:
-
Where the sales tax incurred in a purchase of assets or services is not recoverable from the taxation
authority, in which case the sales tax is recognised as part of the cost of acquisition of the asset or as
part of the expense item as applicable; and
Receivables and payables that are stated with the amount of sales tax included.
The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of
receivables or payables in the statements of financial position.
2.27 Segment reporting
For management purposes, the Group is organised into operating segments based on their products and services
which are independently managed by the respective segment managers responsible for the performance of the
respective segments under their charge. The segment managers report directly to the management of the
Company who regularly review the segment results in order to allocate resources to the segments and to assess
the segment performance. Additional disclosures on each of these segments are shown in Note 41, including the
factors used to identify the reportable segments and the measurement basis of segment information.
2.28 Share capital and share issuance expenses
An equity instrument is any contract that evidences a residual interest in the assets of the Group and the Company
after deducting all of its liabilities. Ordinary shares are equity instruments.
Ordinary shares are recorded at the proceeds received, net of directly attributable incremental transaction costs.
Ordinary shares are classified as equity. Dividends on ordinary shares are recognised in equity in the period in
which they are declared.
87
Annual Report 2010
2.
Development costs
Development costs are capitalised in accordance with the accounting policy in note 2.8(b). Initial capitalisation
of costs is based on management's judgement that technological and economical feasibility is confirmed.
The carrying amount of development costs capitalised at the balance sheet date is RM298,337.
88
ALAM MARITIM RESOURCES BERHAD (700849-K)
4.
Revenue
Group
Charter hire
Offshore installation and construction
Ship catering
Rental of equipment
Diving and underwater services
Other shipping related income
Sales of diving equipment
Dividend income from subsidiaries
Vessel's management fees
5.
Company
2010
RM
2009
RM
2010
RM
2009
RM
181,572,851
27,324,592
1,614,852
5,683,509
1,807,427
12,276,457
5,691,220
6,220,915
202,002,407
84,778,312
3,301,945
26,076,057
291,444
6,165,390
20,036,136
6,265,441
1,713,250
-
242,191,823
348,917,132
1,713,250
Company
2010
RM
2009
RM
2010
RM
2009
RM
16,625,581
1,905,353
150,237
519,467
3,117,603
17,329,408
1,552,957
97,632
2,302,148
3,364,341
129,540
39,264
142,000
91,928
8,900
22,318,241
24,646,486
168,804
242,828
Included in employee benefits expense of the Group and of the Company are executive directors' remuneration
amounting to RM4,023,457 (2009: RM3,569,950) and RM Nil (2009: RM Nil) as further disclosed in Note 6.
89
Annual Report 2010
Directors' remuneration
Group
Company
2010
RM
2009
RM
2010
RM
2009
RM
71,602
3,951,855
73,356
3,496,594
4,023,457
3,569,950
170,965
61,000
102,000
131,928
170,965
61,000
102,000
131,928
231,965
233,928
231,965
233,928
4,255,422
3,803,878
231,965
233,928
113,500
133,500
15,000
15,000
4,368,922
3,937,378
246,965
248,928
Executive:
Salaries and other emoluments
Bonus
Defined contribution plan - EPF
Share options granted under ESOS
Estimated money value of benefits-in-kind
2,547,000
730,200
295,830
450,427
98,500
2,125,836
518,400
193,116
732,598
118,500
4,121,957
3,688,450
Non-executive:
Fees and other emoluments
Share options granted under ESOS
Estimated money value of benefits-in-kind
231,965
15,000
142,000
91,928
15,000
231,965
15,000
142,000
91,928
15,000
246,965
248,928
246,965
248,928
4,368,922
3,937,378
246,965
248,928
90
ALAM MARITIM RESOURCES BERHAD (700849-K)
7.
Executive directors:
RM500,001 - RM600,000
RM700,001 - RM800,000
RM800,001 - RM900,000
RM1,100,001 - RM1,200,00
RM1,201,001 - RM1,300,00
1
1
1
1
2
2
-
Non-executive directors:
RM10,001 - RM20,000
RM20,001 - RM30,000
RM40,001 - RM50,000
RM50,001 - RM60,000
RM80,001 - RM90,000
RM110,001 - RM120,000
1
1
1
1
1
2
-
Finance costs
Group
Company
2010
RM
2009
RM
2010
RM
2009
RM
3,023,667
1,477,280
3,568,258
24,442,800
1,819,908
896,308
931,955
4,630,986
24,324,605
1,217,578
7,942
-
9,466
-
34,331,913
32,001,432
7,942
9,466
(3,103,184)
(6,126,595)
31,228,729
25,874,837
7,942
9,466
91
Annual Report 2010
8.
Company
2010
RM
2009
RM
2010
RM
2009
RM
231,965
233,928
231,965
233,928
167,300
35,872
162,300
55,017
45,000
-
45,000
-
141,024
1,866,075
43,831,324
560,784
8,536,970
686,684
26,917,084
34,069,546
1,005,763
28,020,284
31,880,541
9,035,533
55,585
-
55,586
-
(121,692)
119,335
10,652
4,405,058
(2,233,050)
122,260
9,997
4,576,266
429,696
(2,976,348)
(995,220)
(988,642)
(2,836,929)
113,457
Company
2010
RM
2009
RM
2010
RM
2009
RM
212,009
-
4,314,522
1,300,846
165,784
-
192,124
-
1,653,727
(620,941)
455,971
13,911
1,562
-
100,354
-
1,244,795
6,085,250
167,346
292,478
(7,213,022)
801,526
10,126,285
(21,437)
967,548
(6,411,496)
11,072,396
(5,166,701)
17,157,646
167,346
292,478
Domestic income tax is calculated at the Malaysian statutory tax rate of 25% (2009: 25%) of the estimated assessable
profit for the year.
Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions.
92
ALAM MARITIM RESOURCES BERHAD (700849-K)
9.
Taxation at Malaysian
statutory tax rate of 25% (2009: 25%)
Effect of income subject to tax rate of 20%
Different tax rates in other countries
Different tax rates in other jurisdiction
Effect of income not subject to tax
Effect of share of results of jointly controlled
entities and associates
Effect of expenses not deductible for tax
purposes
Effect of change in tax rates on opening
balance of deferred tax
Deferred tax assets not
recognised in respect
of current year's tax
losses and unabsorbed
capital allowances
Underprovision of income tax in prior years
Underprovision of deferred tax in
prior year
Income tax (benefit)/ expense for the year
(18,115,606)
Company
2009
RM
2010
RM
2009
RM
112,524,398
67,154
1,929,525
(4,528,902)
10,605
(207,225)
(112,082)
28,131,100
(25,000)
(777,231)
(7,097,109)
( 11,793)
16,789
-
482,381
(428,312)
(3,012,859)
(6,623,691)
148,995
138,055
838,687
2,145,377
(21,437)
10,763
1,032,786
469,882
1,562
100,354
801,526
967,548
17,157,646
167,346
292,478
(5,166,701)
Basic
Basic earnings per share amounts are calculated by dividing (loss)/profit for the year attributable to ordinary equity
holders of the Company by the weighted average number of ordinary shares in issue during the financial year.
93
Annual Report 2010
2010
RM
2009
RM
(13,917,996)
633,890,370
91,279,940
497,446,671
(2.2)
18.3
2009
RM
(13,917,996)
633,890,370
18,191,816
91,279,940
497,446,671
21,584,549
652,082,186
519,031,220
(2.1)
17.6
11. Dividends
Dividends in respect
of year
2010
2009
RM
RM
Dividends
recognised in year
2010
2009
RM
RM
2,860,186
2,860,186
1,875,480
94
ALAM MARITIM RESOURCES BERHAD (700849-K)
95
10,062,360
At 31 December 2009
(restated)
10,062,360
As restated
Additions
Reclassification
Disposals
Transfer to associates
Written off
Exchange differences
10,062,360
14,564,493
10,512,937
4 71,310
41,646
3,538,600
3,538,600
Leasehold
building
RM
As previously stated
Effects of adopting
the amendments to FRS 117
At 1 January 2009
Cost
Group
Long term
leasehold
land
RM
592,131,642
119,083,394
(119,083,394)
-
592,131,642
592,131,642
Vessels
RM
15,331,617
2,913,752
(5,759,644)
-
18,177,509
18,177,509
Drydocking
RM
42,165,628
6,924,840
76,530
35,164,950
35,164,258
Diving
equipment,
equipment
on vessel
RM
4,040,904
151,497
(275,899)
(86,644)
-
4,251,950
4,251,950
Motor
vehicles
RM
5,674,587
1,587,318
46,669
4,040,600
4,040,600
10,062,360
242,090,144 912,542,445
242,090,144 902,480,085
Total
RM
3,767,813
211,930,078 899,669,122
812,234
89,394,507 112,297,085
- (119,554,704)
(139,039)
(414,938)
- (119,083,394)
(5,846,288)
9,236
131
174,212
3,085,382
3,085,382
Computers,
office
equipment,
Assets
furniture
under
and fittings Renovations construction
RM
RM
RM
96
10,062,360
10,062,360
1,977,150
-
12,039,510
As restated
Additions
Reclassification
Disposals
Transfer to associates
Exchange differences
At 31 December 2010
592,131,642
Vessels
RM
15,987,824
592,131,642
14,564,493
592,131,642
1,712,000
256,124,464
- (256,124,464)
(288,669)
-
14,564,493
Leasehold
building
RM
As previously stated
Effects of adopting
the amendments to FRS 117
At 1 January 2010
Cost (contd)
Group (contd.)
Long term
leasehold
land
RM
21,592,355
15,736,242
5,856,113
-
15,736,242
Drydocking
RM
89,080,892
42,165,628
25,551,570
27,883,872
(7,483,017)
962,839
42,165,628
Diving
equipment,
equipment
on vessel
RM
4,628,985
4,040,904
588,081
-
4,040,904
Motor
vehicles
RM
4,861,117
5,753,278
571,434
(1,463,595)
5,753,278
10,062,360
211,930,078 890,096,094
Total
RM
3,866,035
80,540,433 824,728,793
3,773,829
Computers,
office
equipment,
Assets
furniture
under
and fittings Renovations construction
RM
RM
RM
97
9,997
9,997
-
9,997
As restated
Charge for the year
Disposals
Written off
Exchange differences
At 31 December 2009
(restated)
488,173
242,221
245,301
651
242,221
Leasehold
building
RM
As previously stated
Effects of adopting
the amendments to FRS 117
At 1 January 2009
Accumulated depreciation
Group (contd.)
Long term
leasehold
land
RM
85,312,468
63,970,052
21,342,416
-
63,970,052
Vessels
RM
4,609,701
9,613,282
392,800
(5,396,381)
-
9,613,282
Drydocking
RM
15,006,342
6,825,038
8,167,443
13,861
6,825,038
Diving
equipment,
equipment
on vessel
RM
2,772,426
2,303,349
765,187
(275,899)
(20,211)
-
2,303,349
Motor
vehicles
RM
1,904,327
1,236,260
667,972
95
1,236,260
749,926
590,708
299,422
(139,039)
(1,165)
590,708
84,790,907
31,880,541
(414,938)
(5,416,592)
13,442
9,997
84,780,910
Total
RM
- 110,853,360
Computers,
office
equipment,
Assets
furniture
under
and fittings Renovations construction
RM
RM
RM
98
10,052,363
12,018,861
At 31 December 2009
At 31 December 2010
20,649
At 31 December 2010
15,096,074
14,076,320
891,750
488,173
406,679
(3,102)
9,997
9,997
10,652
-
488,173
Leasehold
building
RM
As restated
Charge for the year
Disposals
Exchange differences
As previously stated
Effects of adopting
the amendments to FRS 117
At 1 January 2010
Accumulated depreciation
Group (contd.)
Long term
leasehold
land
RM
485,476,761
506,819,174
106,654,881
85,312,468
21,342,413
-
85,312,468
Vessels
RM
8,558,654
10,721,916
13,033,701
9,059,537
3,974,164
-
9,059,537
Drydocking
RM
72,074,152
27,159,286
17,006,740
10,961,130
6,645,765
(869,205)
269,050
10,961,130
Diving
equipment,
equipment
on vessel
RM
1,104,722
1,268,478
3,524,263
2,846,181
678,082
-
2,846,181
Motor
vehicles
RM
2,669,080
3,770,260
2,192,037
1,927,046
599,466
(334,475)
1,927,046
2,691,056
3,017,887
1,174,979
740,600
412,325
22,054
740,600
Total
RM
9,997
80,540,433 680,229,793
211,930,078 788,815,762
- 144,499,000
- 111,345,132
- 34,069,546
(869,205)
(46,473)
- 111,335,135
Computers,
office
equipment,
Assets
furniture
under
and fittings Renovations construction
RM
RM
RM
Company
Cost
At 1 January/31 December
277,926
2 77,926
At 1 January
Depreciation charge for the year
185,284
55,585
129,698
55,586
At 31 December
240,869
185,284
37,057
92,642
Accumulated depreciation
(a)
Included in the Group's additions for the year are property, vessels and equipment of RM12,485,877 (2009:
RM11,127,806) which were acquired by means of hire purchase and finance lease arrangements. Net carrying
amounts of property, vessels and equipment held under hire purchase and finance lease arrangements are
as follows:
Group
Motor vehicles
Diving equipment
Assets under construction
Company
2010
RM
2009
RM
2010
RM
2009
RM
1,104,722
26,459,583
-
1,268,478
9,793,519
37,057
-
92,642
-
Details of the terms and conditions of the hire purchase and finance lease arrangements are disclosed in Note 28.
(b)
The net carrying amounts of property, vessels and equipment of the Group which are pledged as securities for
borrowings as disclosed in Note 27 are as follows:
Group
Leasehold buildings
Vessels
2010
RM
2009
RM
15,096,074
485,476,761
14,076,320
506,819,174
500,572,835
520,895,494
(c)
The strata titles for the leasehold buildings with a net carrying amount of RM2,624,735 (2009:RM2,097,260) have
not been issued by the relevant authorities.
(d)
As disclosed in Note 7, interest expense capitalised in relation to vessels under construction during the financial
year, for the Group amounted to RM3,103,184 (2009: RM6,126,595).
99
Annual Report 2010
2009
Cost
At 1 January:
As previously stated
Additions
Effects of adopting the amendments to FRS 117
At 31 December (restated)
10,062,360
(10,062,360)
10,062,360
(10,062,360)
9,997
(9,997)
9,997
(9,997)
Accumulated amortisation
At 1 January:
As previously stated
Amortisation for the year
Effects of adopting the amendments to FRS 117
At 31 December (restated)
The title for the leasehold land has not been issued by the relevant authorities.
100
ALAM MARITIM RESOURCES BERHAD (700849-K)
Development
costs
RM
Total
RM
Group
Cost
At 1 January 2010
Exchange differences
1,422,263
(29,508)
611,300
(14,625)
2,033,563
(44,133)
At 31 December 2010
1,392,755
596,675
1,989,430
At 1 January 2009
Exchange differences
1,406,411
15,852
603,475
7,825
2,009,886
23,677
At 31 December 2009
1,422,263
611,300
2,033,563
183,390
119,335
(4,387)
183,390
119,335
(4,387)
At 31 December 2010
298,338
298,338
At 1 January 2009
Charge for the year
Exchange differences
60,348
122,260
782
60,348
122,260
782
At 31 December 2009
183,390
183,390
At 31 December 2010
1,392,755
298,337
1,691,092
At 31 December 2009
1,422,263
427,910
1,850,173
(a)
Underwater
services
RM
Offshore
support
vessels and
services
RM
Total
RM
At 31 December 2010
1,208,877
183,878
1,392,755
At 31 December 2009
1,238,385
183,878
1,422,263
101
Annual Report 2010
2010
RM
2009
RM
100,302,070
100,302,070
Country of
Incorporation
Principal
Activities
Malaysia
Ship owning,
chartering and
managing and
other shipping
related activities
100
100
Federal
Territory
of Labuan,
Malaysia
Investment
holding and ship
owning
100
100
Name of Subsidiaries
102
ALAM MARITIM RESOURCES BERHAD (700849-K)
Country of
Incorporation
Principal
Activities
Malaysia
Offshore
facilities
construction
and installation
and underwater
services
70
70
Alam Offshore
Services & Logistics
Sdn. Bhd.
("AOLSB")
Malaysia
Transportation,
ship forwarding
and agent, ship
chandeling and
other related
activities
100
100
Alam Food
Industries (M)
Sdn. Bhd. ("AFI")
Malaysia
Catering &
messing
services
100
100
KJ Waja
Engineering
Sdn. Bhd.
("KJWE")
Malaysia
84
84
Malaysia
Ship spare
supply and
other related
services
84
84
Singapore
Designing,
manufacturing
and operating of
remotely
operated
vehicles
("ROVs")
75
60
Alam Subsea
Pte. Ltd. ("ASPL") *
Singapore
Rental of ROV
and providing
ROV Services
100
Singapore
Rental of ROV
and providing
ROV Services
75
Name of Subsidiaries
(ii) Held through AMSB:
103
Annual Report 2010
On 1 January 2010, the Company through its wholly-owned subsidiary, Alam Maritim (L) Inc. ("AMLI") acquired
15,950 ordinary shares of SGD1.00 each in EASTAR Offshore Pte Ltd ("EASTAR") from other shareholders for
a total cash consideration of SGD2,400,000. The Company's equity interest in EASTAR increased from 60% to
64% thereof.
The additional investment has resulted in the following:
RM
(ii)
5,826,960
(315,443)
5,511,517
On 1 January 2010, EASTAR increased its issued and paid-up share capital from 432,502 to 628,203 ordinary
shares of SGD1.00 each. Pursuant to the increase in share capital, the Company via AMLI subscribed for an
additional 195,701 ordinary shares of SGD1.00 each in EASTAR. AMLI's equity interest in EASTAR increased
from 64% to 75% thereof.
104
ALAM MARITIM RESOURCES BERHAD (700849-K)
2009
RM
56,911,582
2,411,273
(4,415,655)
24,894,933
2,707,572
(5,376,558)
54,907,200
22,225,947
Country of
Incorporation
Principal
Activities
Alam-PE
Holdings (L) Inc.
("ALAM-PE(H)")
Federal
Territory
of Labuan,
Malaysia
Ship
management
and operation,
ship owning, ship
maintenance
and marine
consultancy
49
49
TH-Alam Holdings
(L) Inc ("THAH") ^
Federal
Territory
of Labuan,
Malaysia
Investment
holding
49
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
49
49
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
49
49
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
49
49
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
49
49
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
49
49
Alam-PE Services
Incorporated
("ALAM-PE SVS")
British Virgin
Island
Ship
management
49
Alam-PE Holdings
Sdn Bhd
("ALAM-PE(H)SB")
Malaysia
Ship
management
49
Name of associate
105
Annual Report 2010
Country of
Incorporation
Principal
Activities
Federal
Territory
of Labuan,
Malaysia
Ship owning
49
Federal
Territory
of Labuan,
Malaysia
Ship owning
49
Name of associate
On 30 November 2009, AMLI entered into a Shareholders' Agreement with Lembaga Tabung Haji ("LTH") to jointly
invest and own six Anchor Handling Tug Supply ("AHTS") vessels via a newly incorporated entity, TH-Alam
Holdings (L) Inc. ("THAH").
The summarised financial information of the associates, adjusted for the proportion of ownership interest held by the
Group, is as follows:
2010
RM
2009
RM
37,334,682
215,762,167
53,458,237
88,738,576
Total assets
253,096,849
142,196,813
Current liabilities
Non-current liabilities
53,582,179
140,407,565
33,123,896
83,733,192
Total liabilities
193,989,744
116,857,088
25,892,100
1,688,119
10,975,906
3,130,409
Results
Revenue
Profit for the year
106
ALAM MARITIM RESOURCES BERHAD (700849-K)
2010
RM
2009
RM
36,798,709
43,882,195
14,066,252
31,534,462
80,680,904
45,600,714
Proportion of ownership
Interest
2010
2009
%
%
Country of
Incorporation
Principal
Activities
Malaysia
Ship owning,
operating and
chartering
60
60
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
60
60
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
60
60
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
60
60
Alam Swiber
Offshore (M) Sdn
Bhd ("ASOSB") ^^
Malaysia
Ship operator
50
50
Alam Radiance
(M) Sdn Bhd
("ARMSB") ***
Malaysia
Ship owning,
ship management
ship operation,
maintenance
and consultancy
50
107
Annual Report 2010
Proportion of ownership
Interest
2010
2009
%
%
Country of
Incorporation
Principal
Activities
Workboat
International
FZCO
("WBI")
United Arab
Emirates
Ship
management
and operation,
ship owning, ship
maintenance
and marine
consultancy
60
60
Alam Brompton
(L) Inc. ("ABLI")
Federal
Territory
of Labuan,
Malaysia
Ship
management
and operation,
ship owning, ship
maintenance
and marine
consultancy
51
51
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
50
50
Alam Swiber
DLB 1 (L) Inc.
("ASDLB1") ^
Federal
Territory
of Labuan,
Malaysia
Ship owning
and chartering
50
50
Alam Radiance
(L) Inc.
("ARLI") **
Federal
Territory
of Labuan,
Malaysia
Ship owning,
operating and
chartering
50
TH-Alam
Management (M)
Sdn Bhd ("THAM") *
Malaysia
Ship
management
and consultancy
50
On 17 September 2009, AMLI entered into a Shareholders' Agreement with Swiber Engineering Limited (SEL) to
jointly own and charter an accommodation pipelay work barge, via a newly incorporated entity, Alam Swiber DLB
1 (L) Inc (ASDLB1).
^^
On 17 September 2009, AMSB entered into a Shareholders' Agreement with Swiber Offshore Construction Pte Ltd
(SOC) to jointly undertake offshore installation and construction projects, via a newly incorporated entity, Alam
Swiber Offshore (M) Sdn Bhd (ASOSB").
On 1 June 2010, AMLI entered into a Shareholders' Agreement with LTH to jointly manage vessels under THAH via
a newly incorporated entity, TH-Alam Management (M) Sdn. Bhd. ("THAM").
**
On 2 August 2010, AMLI signed a Joint Venture Agreement with Pacific Crest Pte Ltd (PCPL) to jointly invest and
own an accommodation work barge via a newly incorporated entity, Alam Radiance (L) Inc. ("ARLI").
*** On 2 August 2010, AMLI signed a Joint Venture Agreement with PCPL to jointly manage barge under ARLI via a
newly incorporated entity, Alam Radiance (M) Sdn Bhd ("ARMSB").
108
ALAM MARITIM RESOURCES BERHAD (700849-K)
2009
RM
78,838,818
225,681,283
54,396,561
124,559,709
Total assets
304,520,101
178,956,270
Current liabilities
Non-current liabilities
95,032,261
128,962,891
68,923,596
64,326,459
Total liabilities
223,995,152
133,250,055
Results
Revenue
Expenses, including finance costs and taxation
97,171,558
(88,544,312)
111,221,819
(93,941,021)
19. Inventories
Group
Cost
Raw materials
Work-in-progress
Spare parts
109
Annual Report 2010
2010
RM
2009
RM
2,290,783
5,996,510
219,791
1,474,658
21,639,822
248,435
8,507,084
23,362,915
Third parties
Accrued charter hire income
Construction contracts:
Due from customers on contract (Note 21)
2010
RM
2009
RM
127,518,450
24,487,474
121,853,110
22,522,558
3,467,500
16,454,046
155,473,424
(38,038,887)
160,829,714
(10,140,295)
117,434,537
150,689,419
Trade receivables are non-interest bearing and are generally on 30 to 90 days (2009: 30 to 90 days) terms. They are
recognised at their original invoice amounts which represent their fair values on initial recognition.
Other information on financial risks of trade receivables are disclosed in Note 38(a).
Ageing analysis of trade receivables
The ageing analysis of the Group's trade receivables is as follows:
Group
2010
RM
Neither past due nor impaired
50,315,916
17,378,469
1,339,467
1,761,488
661,405
16,720,722
Impaired
37,861,551
67,295,957
155,473,424
110
ALAM MARITIM RESOURCES BERHAD (700849-K)
67,295,957
(38,038,887)
29,257,070
10,140,295
28,020,284
(121,692)
At 31 December
38,038,887
Trade receivables that are individually determined to be impaired at the reporting date relate to debtors that are in
significant financial difficulties and have defaulted on payments. These receivables are not secured by any collateral or
credit enhancements.
111
Annual Report 2010
2009
RM
26,685,028
(11,340,698)
99,080,213
(7,749,337)
15,344,330
(11,876,830)
91,330,876
(74,876,830)
3,467,500
16,454,046
Company
2010
RM
2009
RM
2010
RM
2009
RM
73,018,084
76,711,991
84,301,702
10,057,659
1,248
1,872
Deposits
Prepayments
Sundry receivables
149,730,075
10,130,429
5,632,074
4,046,683
94,359,361
12,825,013
4,115,102
4,479,117
3,120
-
169,539,261
(231,367)
115,778,593
(231,367)
3,120
-
Receivables, net
169,307,894
115,547,226
3,120
Other details on financial risks of other receivables are disclosed in Note 38.
112
ALAM MARITIM RESOURCES BERHAD (700849-K)
Company
2010
RM
2009
RM
2010
RM
2009
RM
Non-current assets
Deposits with a licensed bank
11,567,361
10,094,886
Current assets
Cash on hand and at banks
Deposits with licensed banks
142,806,877
24,203,595
183,517,730
9,527,615
78,319,606
10,000,000
70,501,774
6,500,000
167,010,472
193,045,345
88,319,606
77,001,774
178,577,833
203,140,231
88,319,606
77,001,774
(4,586,157)
(7,508,926)
(1,876,192)
(6,000,000)
(8,161,330)
(8,056,935)
88,319,606
77,001,774
158,321,420
187,207,104
The weighted average effective interest rate per annum and the remaining maturity of deposits of the Group as at 31
December 2010 are 1.90% (2009: 1.90%) and 1,280 days (2009: 1,280 days) respectively.
Other information on financial risks of cash and cash equivalents are disclosed in Note 38.
Amount
Share capital
(issued and
fully paid)
RM
Share
premium
RM
Total
RM
At 1 January 2009
Pursuant to ESOS (Note 32)
492,845,986
14,141,112
123,211,497
3,535,278
68,689,027
9,781,911
191,900,524
13,317,189
506,987,098
19,925,463
254,237,816
126,746,775
4,981,366
63,559,454
78,470,938
7,717,580
(63,559,454)
205,217,713
12,698,946
-
At 31 December 2010
781,150,377
195,287,595
22,629,064
217,916,659
113
Annual Report 2010
Amount
2010
RM
2009
RM
250,000,000
250,000,000
1,000,000,000
1,000,000,000
The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled to one
vote per share at meetings of the Company. All ordinary shares rank equally with regard to the Companys
residual assets.
(a)
(b) Ordinary shares issued pursuant to the Company's Employee Share Options Scheme
During the financial year, the Company issued 19,925,463 (2009: 14,141,112) ordinary shares of RM0.25 each for
cash pursuant to the Company's Employee Share Options Scheme at the exercise price ranging from RM0.44 to
RM1.40 (2009: RM0.60 to RM1.59) per ordinary share.
25. Other reserves
Employee
share option
reserve
RM
Premium paid
on acquisition
of minority
interest
RM
Foreign
currency
translation
reserve
RM
Total
RM
7,897,646
70,857
7,968,503
101,550
101,550
2,302,148
(3,586,668)
2,302,148
(3,586,668)
(1,284,520)
(1,284,520)
At 31 December 2009
6,613,126
172,407
6,785,533
At 1 January 2010
6,613,126
172,407
6,785,533
(143,244)
(143,244)
(5,511,517)
(5,511,517)
519,467
(2,683,597)
519,467
(2,683,597)
(2,164,130)
(5,511,517)
(7,675,647)
4,448,996
(5,511,517)
29,163
(1,033,358)
Group
At 1 January 2009
Foreign currency translation, representing
other comprehensive income
Transaction with owners:
Share options granted under ESOS:
Recognised in income statement
Exercised during the year
At 31 December 2010
114
ALAM MARITIM RESOURCES BERHAD (700849-K)
Employee
share option
reserve
RM
Premium paid
on acquisition
of minority
interest
RM
Foreign
currency
translation
reserve
RM
Total
RM
At 1 January 2009
7,897,646
7,897,646
2,302,148
(3,586,668)
2,302,148
(3,586,668)
At 31 December 2009
6,613,126
6,613,126
At 1 January 2010
6,613,126
6,613,126
519,467
(2,683,597)
519,467
(2,683,597)
At 31 December 2010
4,448,996
4,448,996
Company
(b)
115
Annual Report 2010
27. Borrowings
Group
Company
2010
RM
2009
RM
2010
RM
2009
RM
4,586,157
2,042,327
96,920,629
80,000,000
1,876,192
2,717,547
96,763,123
30,000,000
96,920,629
80,000,000
96,763,123
30,000,000
5,300,077
772,293
28,288
26,763
188,849,190
132,129,155
176,948,917
126,789,886
45,000,000
25,000,000
233,849,190
157,129,155
176,948,917
126,789,886
28,016,153
390,000,000
29,089,387
445,000,000
390,000,000
445,000,000
17,148,627
12,227,055
116,754
145,042
435,164,780
486,316,442
390,116,754
445,145,042
Unsecured:
Revolving credits
116
ALAM MARITIM RESOURCES BERHAD (700849-K)
Company
2010
RM
2009
RM
2010
RM
2009
RM
4,586,157
45,000,000
30,058,480
96,920,629
470,000,000
1,876,192
25,000,000
31,806,934
96,763,123
475,000,000
96,920,629
470,000,000
96,763,123
475,000,000
22,448,704
12,999,348
145,042
171,805
669,013,970
643,445,597
567,065,671
571,934,928
Total borrowings
Bank overdrafts (Note 23)
Revolving credits
Term loans
MCP/MMTN
Sukuk Ijarah MTN
Hire purchase and finance lease
liabilities (Note 28)
2010
RM
2009
RM
228,549,157
32,164,718
269,896,926
115,954,465
156,356,862
82,018,199
162,475,819
229,595,369
646,565,266
630,446,249
The weighted average effective interest rates at the balance sheet date for borrowings, excluding hire purchase and
finance lease liabilities of the Group, are as follows:
Group
Bank overdrafts
Revolving credits
Term loans
MCP/MMTN
Sukuk Ijarah MTN
2010
%
2009
%
6.65
4.68
6.50
4.15
4.96
7.05
4.34
6.50
5.02
4.34
Bank overdrafts:
The secured bank overdrafts of the Group are secured by deposits with licensed banks of the Group as disclosed in
Note 23.
117
Annual Report 2010
First legal charge over the vessels and leasehold building of certain subsidiaries as disclosed in Note 12;
(b)
(c)
(d)
(e)
(f)
a first legal charge over the designated accounts as defined in the Trust Deed;
(ii)
third party second fixed legal charge over each of the Ijarah Assets/MCP/MMTN and Sukuk Ijarah MTN assets and
assignment of all insurance thereon and charter contracts.
The features of the MCP/MMTN and Sukuk Ijarah MTN issued are as follows:
(i)
The MCP/MMTN and Sukuk Ijarah MTN have a maximum principal limit of RM600,000,000.
The MCP/MMTN and Sukuk Ijarah MTN were constituted by a Trust Deed Program Agreement dated 6 July 2007
between the Company and the financial institutions concerned in relation to finance the purchase of beneficial
interest in the Ijarah Assets (Syariah Compliant) from subsidiaries.
(ii)
The MCP/MMTN are issued at a discount with yield to maturity ranging from 3.78% to 3.85% per annum. The Sukuk
Ijarah MTN are issued with yield to maturity ranging from 4.58% to 5.63% per annum (2009: 4.58% to 5.63%
per annum).
100,000,000
(7,368,802)
100,000,000
(4,714,547)
92,631,198
4,289,431
95,285,453
1,477,670
96,920,629
96,763,123
118
ALAM MARITIM RESOURCES BERHAD (700849-K)
Group
2009
RM
2010
RM
Company
2009
RM
6,385,067
6,230,505
11,782,276
607,963
854,915
1,162,453
1,129,390
10,318,998
34,704
34,704
92,546
-
34,704
34,704
104,112
23,138
25,005,811
(2,557,107)
13,465,756
(466,408)
161,954
(16,912)
196,658
(24,853)
22,448,704
12,999,348
145,042
171,805
5,300,077
5,177,401
772,293
1,008,220
28,288
29,812
26,763
28,287
480,863
10,228,913
22,745
22,448,704
12,999,348
145,042
171,805
(772,293)
(28,288)
(26,763)
12,227,055
116,754
145,042
(5,300,077)
17,148,627
The Group's and the Company's hire purchase and finance lease liabilities bears weighted average effective interest rates
of 9.38% (2009: 8.45%) per annum and 7.44% (2009: 7.44%) respectively .
Other information on financial risks of hire purchase and finance lease liabilities are disclosed in Note 38.
29. Deferred taxation
2010
RM
Group
2009
RM
At 1 January
Recognised in income statement (Note 9)
Exchange differences
77,511,121
(6,411,496)
(154,086)
66,396,703
11,072,396
42,022
At 31 December
70,945,539
77,511,121
70,945,539
77,511,121
119
Annual Report 2010
80,519,978
10,829,845
(344,709)
At 31 December 2010
91,005,114
At 1 January 2009
Recognised in income statement
Exchange differences
71,610,177
8,891,269
18,532
At 31 December 2009
80,519,978
Provision for
doubtful debts
RM
Unutilised tax
losses and
unabsorbed
capital
allowances
RM
Total
RM
At 1 January 2010
Recognised in income statement
Exchange differences
(1,611,568)
(25,416)
23,035
(1,423,582)
(17,215,925)
193,881
(3,035,150)
(17,241,341)
216,916
At 31 December 2010
(1,613,949)
(18,445,626)
(20,059,575)
At 1 January 2009
Recognised in income statement
Exchange differences
(126,042)
(1,485,414)
(112)
(5,087,432)
3,666,541
(2,691)
(5,213,474)
2,181,127
(2,803)
At 31 December 2009
(1,611,568)
(1,423,582)
(3,035,150)
Deferred tax assets have not been recognised in respect of the following items:
Group
2010
RM
2009
RM
89,041
78,278
The unutilised tax losses of the Group are available indefinitely for offsetting against future taxable profits of the
respective entities within the Group, subject to no substantial change in shareholdings of those entities under the Income
Tax Act, 1967 and guidelines issued by the tax authority. Deferred tax assets is not recognised in respect of these losses
as they arise in Group companies with a history of losses.
120
ALAM MARITIM RESOURCES BERHAD (700849-K)
Company
2010
RM
2009
RM
2010
RM
2009
RM
16,571,492
17,831,431
18,929,903
54,883,579
34,402,923
73,813,482
13,422,399
85,055
3,845,949
24,133,830
16,233,538
1,445,145
1,421,112
10,948,267
409,260
11,713,192
5,000
51,756,326
117,047,107
11,357,527
11,718,192
Other information on financial risks of other payables are disclosed in Note 38.
The number of shares comprised in the options to be offered under the ESOS shall not exceed 15% of the issued
and paid-up share capital of the Company at any point of time. Upon completion of the Initial Public Offering ("IPO")
on 20 July 2006, the total number of new shares to be issued pursuant to the ESOS is 24,350,412.
(b)
When options are granted before the Company is listed on Bursa Malaysia Securities ("Initial Grant"), the exercise
price shall be on a step-up basis starting with a price equivalent to the IPO price of RM1.65 and shall increase on
the third year and fifth year commencing from the date of acceptance of the options as follows:
Exercise price
(c)
Year 1
Year 2
RM1.65
RM1.65
Exercise Period
Year 3
RM1.82
Year 4
Year 5
RM1.82
RM2.00
Where the options are granted on or after the Company is listed on Bursa Malaysia Securities ("Subsequent Grant"),
the exercise price shall be at the higher of the following:
(i)
the weighted average market price of the shares for the five market days immediately preceding the date at
which options are granted subject to a discount of up to 10%; or
(ii)
121
Annual Report 2010
All eligible directors and employees will only be allowed to exercise the options subject to the following limits:
Maximum percentage
of options exercisable
Year 1
Year 2
5%
10%
Exercise Period
Year 3
20%
Year 4
Year 5
30%
35%
(e)
The new shares to be allotted upon any exercise of any option granted shall rank pari passu in all respects with
the existing shares provided always that the new shares so allotted will not be entitled to any dividends, rights,
allotments and/or any distributions declared, made or paid to shareholders which record date thereof precedes the
date of allotment of the new shares and shall be subject to all provisions of the Articles of the Company.
(f)
In the event of any alteration in the capital structure of the Company, whether by way of issue of new shares credited
as fully paid up from capitalisation of profit or reserve, capitalisation issues, rights issues, reduction, subdivision
or consolidation of capital or any other variation of capital:
(i)
(ii)
at
1 January
Granted
Exercised
Bonus
issue
Outstanding
Exercisable
Exercised
1,238,000
2,296,000
2,354,251
32,082,001
(3,000)
(6,500)
(1,479,100)
617,500
1,148,000
1,173,875
15,301,451
(121,500)
(227,375)
(18,088,038)
1,731,000
3,444,000
3,294,251
27,816,314
1,731,000
3,444,000
3,294,251
27,816,314
2,296,000
2,828,388
45,736,976
1,250,000
-
(12,000)
(474,137)
(13,654,975)
1,238,000
2,296,000
2,354,251
32,082,001
363,000
1,470,000
1,107,813
10,596,595
at
at
31 December 31 December
2010
2009 Options
2008 Options
2007 Options
2006 Options
2009
2009 Options
2008 Options
2007 Options
2006 Options
122
ALAM MARITIM RESOURCES BERHAD (700849-K)
Exercise period
2010
2006 Options
2007 Options
2009 Options
2010 Options
0.66
1.47
1.79
1.27
20.07.2006 - 19.07.2011
20.07.2007 - 19.07.2011
20.07.2009 - 19.07.2011
20.07.2010 - 19.07.2011
2009
2006 Options
2007 Options
2009 Options
2010 Options
0.66
1.47
1.79
1.27
20.07.2006 - 19.07.2011
20.07.2007 - 19.07.2011
20.07.2009 - 19.07.2011
20.07.2010 - 19.07.2011
0.19
1.37
1.27
23.53
1.50
2.85
0.37
The expected life of the options is based on historical data and not necessarily indicative of exercise patterns that
may occur. The expected volatility reflects the assumption that the historical volatility is indicative of future trends,
which may also not necessarily be the actual outcome. No other features of the option grant were incorporated into
the measurement of the fair value.
123
Annual Report 2010
2010
RM
2009
RM
1,275,661
1,411,236
1,939,047
470,845
2,686,897
2,409,892
The lease payments recognised in profit or loss during the financial year are disclosed in Note 8.
(b) The Group as lessor
The Group has entered into non-cancellable operating lease agreements on its vessels. These leases have
remaining non-cancellable lease terms of between 0.5 to 13 years. All leases include a clause to enable upward
revision of the charter hire charge on an annual basis based on prevailing market conditions.
The future lease payments receivable under non-cancellable operating leases contracted for as at the balance
sheet date but not recognised as receivables, are as follows:
2010
RM
2009
RM
93,131,053
117,524,453
59,662,647
96,243,398
155,055,965
68,593,138
270,318,153
319,892,501
Charter hire revenue earned from chartering the Group's vessels are recognised as revenue during the financial
year is disclosed in Note 4.
34. Capital commitments
Group
Capital expenditure
Approved and contracted for
Purchase of vessels
Purchase of diving equipment
124
ALAM MARITIM RESOURCES BERHAD (700849-K)
2010
RM
2009
RM
101,821,500
-
271,104,680
26,898,025
2009
RM
159,148,500
159,148,500
Unsecured:
Corporate guarantees given to banks for credit facilities
granted to subsidiaries
In addition to the transactions detailed elsewhere in the financial statements, the Group and the Company had the
following transactions with related parties during the financial year.
Note
2010
RM
2009
RM
15,463,635
2,624,546
7,467,320
3,515,144
254,150,360
6,265,441
124,646,000
519,467
1,713,250
2,210,220
Group
Jointly controlled entities:
Charter hire of vessels
Vessel management fees
(i)
(ii)
Associates:
Vessel management fees from associates
Transfer of vessels to associates
Company
Subsidiaries:
Dividend income from subsidiaries
ESOS costs charged to subsidiaries
(i)
The charter hire expense and mobilisation fees paid to jointly controlled entities were made according to the
published prices and conditions offered by these related parties to their major customers, except that a longer
credit period of up to six months is normally granted.
(ii)
The vessel management fees received from jointly controlled entities were made according to the published
prices and conditions offered by these related parties to their major customers, except that a longer credit
period of up to six months is normally granted.
Information regarding outstanding balances arising from related party transactions as at 31 December 2010
are disclosed in Note 18.
The directors are of the opinion that the transactions have been entered into in the normal course of business
and have been established on terms and conditions that are not materially different from that obtainable in
transactions with unrelated parties.
125
Annual Report 2010
Company
2010
RM
2009
RM
2010
RM
2009
RM
6,554,947
5,395,365
246,965
242,828
469,190
684,496
2010
RM
2009
RM
2010
RM
2009
RM
4,255,422
3,803,878
231,965
233,928
Company
In aggregate, executive directors of the Group and the Company and other members of key management have
been granted a number of options under the ESOS as follows:
Group and Company
2010
2009
RM
RM
At 1 January
Granted
Exercised
Bonus issue
Exercised
28,362,313
(195,000)
41,003,307
(14,188,011)
38,627,275
450,000
(10,714,962)
At 31 December
54,982,609
28,362,313
126
ALAM MARITIM RESOURCES BERHAD (700849-K)
Company
2010
Carrying
amount
RM
Fair
value
RM
Carrying
amount
RM
Fair
value
RM
390,000,000
389,446,810
(17,148,627)
(390,000,000)
(28,016,153)
(17,239,654)
(389,446,810)
(23,899,543)
(116,754)
(390,000,000)
-
(136,476)
(389,446,810)
-
Financial assets:
Due from subsidiaries
Financial liabilities:
Loans and borrowings (non-current)
- Obligations under finance leases
- Sukuk Ijarah MTN
- Fixed rate term loans
Group
2009
Company
2009
Carrying
amount
RM
Fair
value
RM
Carrying
amount
RM
Fair
value
RM
445,000,000
440,271,726
(12,227,055)
(445,000,000)
(29,089,387)
(11,763,334)
(440,271,726)
(25,858,550)
(145,042)
(445,000,000)
-
(136,476)
(440,271,726)
-
Financial assets:
Due from subsidiaries
Financial liabilities:
Loans and borrowings (non-current)
- Obligations under finance leases
- Sukuk Ijarah MTN
- Fixed rate term loans
It is not practical to estimate the fair values of the investment in subsidiaries due principally to the lack of quoted market
prices and the inability to estimate fair values without incurring excessive costs.
The carrying amounts of receivables, cash and bank balances and payables for the Group and the Company approximate
their fair values due to their short term maturity.
The methods and assumptions used by management to determine fair values of financial instruments other than those
whose carrying amounts reasonably approximate their fair value are as follows:
(i)
127
Annual Report 2010
Credit risk
Credit risk is the risk of loss that may arise on outstanding financial instruments should a counterparty default on
its obligations. The Groups and the Companys exposure to credit risk arises primarily from trade and other
receivables. For other financial assets (including cash and bank balances), the Group and the Company minimise
credit risk by dealing exclusively with high credit rating counterparties.
The Groups objective is to seek continual revenue growth while minimising losses incurred due to increased credit
risk exposure. The Group trades only with recognised and creditworthy third parties. It is the Groups policy that
all customers who wish to trade on credit terms are subject to credit verification and evaluation procedures. In
addition, trade receivable balances are monitored on an ongoing basis in view of reducing the Groups exposure to
bad debts.
Exposure to credit risk
At the reporting date, the Groups and the Companys maximum exposure to credit risk is represented by:
-
The carrying amount of each class of financial assets recognised in the statements of financial position; and
A nominal amount of RM45,000,000 relating to corporate guarantee provided by the Company to banks on a
subsidiarys bank loans.
26% of the Groups trade receivables were due from 5 major customers who are located in Malaysia;
52% of the Groups trade and other receivables were due from related parties.
128
ALAM MARITIM RESOURCES BERHAD (700849-K)
On demand or
within 1 year
RM
2010
One to five
years
RM
Over five
years
RM
Total
RM
Financial liabilities:
Group
Trade and other payables
Loans and borrowings
80,380,873
241,212,580
418,198,003
46,767,317
80,380,873
706,177,900
321,593,453
418,198,003
46,767,317
786,558,773
11,357,527
178,056,917
374,284,750
45,276,667
11,357,527
597,618,334
189,414,444
374,284,750
45,276,667
608,975,861
Company
(c)
129
Annual Report 2010
strengthened 3%
weakened 3%
strengthened 3%
weakened 3%
(277)
277
(319)
319
strengthened 3%
weakened 3%
strengthened 3%
weakened 3%
strengthened 3%
weakened 3%
(325)
325
(658)
658
11
(11)
Financial liabilities
USD/RM
SGD/RM
IDR/RM
130
ALAM MARITIM RESOURCES BERHAD (700849-K)
Company
2009
RM
2010
RM
2009
RM
669,013,970
80,380,873
(167,010,472)
643,445,597
145,972,993
(193,045,345)
567,065,671
11,357,527
(88,319,606)
571,934,928
11,718,192
(77,001,774)
Net debt
582,384,371
596,373,245
490,103,592
506,651,346
465,024,491
476,472,759
227,698,179
220,123,741
1,047,408,862
1,072,846,004
717,801,771
726,775,087
55.6%
55.6%
68.3%
69.7%
Gearing ratio
Reporting format
The primary segment reporting format is determined to be business segments as the Groups risks and rates of
return are affected predominantly by differences in the products and services produced. The operating businesses
are organised and managed separately according to the nature of the products and services provided, with each
segment representing a strategic business unit that offers different products and serves different markets.
131
Annual Report 2010
Underwater services
Provision of offshore facilities construction and installation services such as marine construction related
services, sub-sea engineering services and offshore pipeline construction related services and designing,
manufacturing and operating of remotely operated vehicles ("ROVs").
Other business segments include investment holding and provision of transportation, ship forwarding and agent
and ship chandelling to the subsidiaries, none of which are of a sufficient size to be reported separately.
The directors are of the opinion that all inter-segment transactions have been entered into in the normal course
of business and have been established on terms and conditions that are not materially different from those
obtainable in transactions with unrelated parties.
(c)
Geographical segments
Segmental reporting by geographical segments has not been prepared as the Group's operations are carried out
predominantly in Malaysia.
Underwater
services
RM
Revenue
Sales to external customers
Inter segment sales
198,766,412
1,071,941
42,888,963
4,913,048
536,448
4,283,045
- 242,191,823
(10,268,034)
-
Total revenue
199,838,353
47,802,011
4,819,493
(10,268,034) 242,191,823
(1,880,518)
(30,530,262)
-
4,960,375
(680,969)
-
31,748
(17,498)
-
(2,049,916)
(296,298)
1,061,689
(31,228,729)
(296,298)
12,347,732
12,347,732
(32,410,780)
4,279,406
14,250
10,001,518
(18,115,606)
5,166,701
Others Eliminations
RM
RM
Total
RM
31 December 2010
Results
Segment results
Finance costs
Share of results of associates
Share of results of jointly
controlled entities
Loss before tax
Income tax benefit
Loss for the year
(12,948,905)
132
ALAM MARITIM RESOURCES BERHAD (700849-K)
Underwater
services
RM
589,968,819
56,911,582
80,555,024
-
1,743,358
-
7,962,590 680,229,791
(2,004,381) 54,907,201
36,798,709
518,762,433
313,584
44,759,852
707,347,097
43,882,196
80,680,905
1,377,508
1,691,092
(792,587,436) 478,281,946
1,202,441,543
125,628,460
709,090,455
(741,369,523) 1,295,790,935
Liabilities
Segment liabilities
Unallocated liabilities
94,376,931
845,526,709
18,361,915
71,756,470
390,264,697
191,092,592
3,106,775 506,110,318
(791,200,383) 317,175,388
Total liabilities
939,903,640
90,118,385
581,357,289
(788,093,608) 823,285,706
617,432,100
27,504,334
85,358,642
5,738,308
1,909,752
147,380
8,642,115
679,524
713,342,609
34,069,546
28,020,284
28,020,284
450,427
51,252
17,788
519,467
Revenue
Sales to external customers
Inter segment sales
215,256,189
7,935,358
131,795,575
15,157,071
1,865,368
1,713,250
- 348,917,132
(24,805,679)
-
Total revenue
223,191,547
146,952,646
3,578,618
(24,805,679) 348,917,132
103,410,476
(24,425,576)
3,283,674
22,937,778
(1,427,464)
-
(11,578)
(21,797)
-
23,211,091
Others Eliminations
RM
RM
Total
RM
31 December 2010
Assets
Segment assets
Investment in associates
Investment in jointly
controlled entities
Intangible assets
Unallocated assets
Total assets
Results
Segment results
Finance costs
Share of results of associates
Share of results of jointly
controlled entities
(14,432,206) 111,904,470
- (25,874,837)
3,283,674
-
23,211,091
112,524,398
(17,157,646)
95,366,752
133
Annual Report 2010
Underwater
services
RM
721,338,964
24,894,933
58,426,440
-
407,842
-
8,642,516 788,815,762
(2,668,986) 22,225,947
14,066,252
520,104,321
427,910
93,342,864
703,227,408
31,534,462
45,600,714
1,422,263
1,850,173
(820,741,709) 495,932,884
1,280,404,470
152,197,214
703,635,250
(781,811,454) 1,354,425,480
Liabilities
Segment liabilities
Unallocated liabilities
103,371,960
876,929,990
11,823,233
109,192,416
445,355,714
140,057,929
3,276,656 563,827,563
(819,354,657) 306,825,678
Total liabilities
980,301,950
121,015,649
585,413,643
(816,078,001) 870,653,241
732,770,823
27,206,527
62,094,711
3,938,904
513,856
55,586
10,026,285
679,524
805,405,674
31,880,541
5,955,676
3,079,857
9,035,533
1,830,053
273,969
198,126
2,302,148
Others Eliminations
RM
RM
Total
RM
31 December 2009
Assets
Segment assets
Investment in an associate
Investment in jointly
controlled entities
Intangible assets
Unallocated assets
Total assets
134
ALAM MARITIM RESOURCES BERHAD (700849-K)
42. Supplementary information breakdown of retained profits into realised and unrealised
The breakdown of the retained profits of the Group and of the Company as at 31 December 2010 into realised and
unrealised profits is presented in accordance with the directive issued by Bursa Malaysia Securities Berhad dated 25
March 2010 and prepared in accordance with Guidance on Special Matter No. 1, Determination of Realised and
Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing
Requirements, as issued by the Malaysian Institute of Accountants.
Group
RM
Company
RM
298,161,393
(41,248,325)
5,332,524
-
256,913,068
5,332,524
2,278,317
132,956
40,911,716
2,970,479
303,206,536
5,332,524
(55,065,346)
248,141,190
5,332,524
135
Annual Report 2010
ANALYSIS OF SHAREHOLDINGS
Name of Directors
1.
2.
3.
4.
5.
6.
7.
8.
9.
136
ALAM MARITIM RESOURCES BERHAD (700849-K)
Total
Shareholdings
900,000
0.114
150
0.000
33,111
0.004
1,015,498
0.129
120,000
0.015
112
0.000
1,500
0.000
1,875
0.000
230,625
0.029
123,750
0.015
2,426,621
0.309
Analysis of Shareholdings
(contd.)
NO. OF HOLDERS
NO. OF SHARES
1 - 99
100 - 1,000
1,001 - 10,000
10,001 - 100,000
100,001 - 39,183,129 (*)
39,183,130 AND ABOVE (**)
87
264
3,495
1,338
187
3
1,618
4.912
65.035
24.897
3.479
0.055
4,805
203,617
18,889,245
41,292,400
268,533,510
454,729,035
0.000
0.025
2.411
5.269
34.266
58.026
Total
5,374
100.000
783,662,612
100.000
Remark :
No.
Name
Holdings
269,860,896
34.435
112,306,239
14.330
72,561,900
9.259
454,729,035
58.024
Total
137
Annual Report 2010
Analysis of Shareholdings
(contd.)
Name
Holdings
269,860,896
34.435
112,306,239
14.330
72,561,900
9.259
30,076,050
3.837
29,090,550
3.712
25,950,573
3.311
19,569,350
2.497
9,947,600
1.269
9,764,286
1.245
10
8,491,050
1.083
11
7,524,786
0.960
12
7,404,400
0.944
13
7,132,086
0.910
14
7,000,000
0.893
15
4,696,550
0.599
138
ALAM MARITIM RESOURCES BERHAD (700849-K)
Analysis of Shareholdings
(contd.)
No.
Name
Holdings
16
4,500,000
0.574
17
3,750,000
0.478
18
3,537,200
0.451
19
2,812,500
0.358
20
2,800,000
0.357
21
2,256,500
0.287
22
2,230,200
0.284
23
2,134,400
0.272
24
2,100,000
0.267
25
2,075,700
0.264
26
2,075,000
0.264
27
DUSHYANTHI PERERA
1,990,000
0.253
28
1,941,450
0.247
29
1,724,200
0.220
30
1,722,100
0.219
SUMMARY
TOTAL NO. OF HOLDERS
30
TOTAL HOLDINGS
659,025,566
84.095
139
Annual Report 2010
NOTICE IS HEREBY GIVEN THAT the Sixth Annual General Meeting of Alam Maritim Resources Berhad will be held on
Wednesday, 15 June 2011 at 10.00 a.m., at Ballroom 1, Sime Darby Convention Centre, 1A Jalan Bukit Kiara 1, 60000 Kuala
Lumpur, for the transaction of the following business:
AGENDA
ORDINARY BUSINESS
1.
To receive the audited Financial Statements for the financial year ended 31 December 2010 (Resolution 1)
and the Reports of the Directors and Auditors thereon.
2.
To re-elect Puan Fina Norhizah binti Haji Baharu Zaman who retire in accordance with (Resolution 2)
Article 100 of the Companys Articles of Association, and who, being eligible offer herself for
re-election.
3.
To re-elect the following Directors who retire by rotation in accordance with Article 94 of
the Companys Articles of Association, and who, being eligible offer themselves for reelection:
4.
i.
(Resolution 3)
ii.
(Resolution 4)
To appoint Messrs Ernst & Young as Auditors of the Company for the financial year ending (Resolution 5)
31 December 2011 and to authorise the Directors to determine their remuneration.
SPECIAL BUSINESS
To consider and if thought fit, pass the following resolutions:
5.
Authority for the Directors to issue shares pursuant to Section 132D of the Companies Act (Resolution 6)
1965 (the Act). [Ordinary Resolution]
THAT pursuant to Section 132D of the Act, the Articles of Association of the Company and
subject to the approvals of the relevant regulatory authorities, the Directors be and are
hereby empowered to issue shares of the Company from time to time until the conclusion
of the next Annual General Meeting, upon such terms and conditions and for such purposes
as the Directors may, in their absolute discretion, deem fit provided that the aggregate
number of shares to be issued pursuant to this resolution does not exceed 10% of the issued
and paid-up share capital of the Company for the time being.
AND THAT the Directors be empowered to take all steps as they may deem necessary or
expedient in order to implement, finalise and give full effect to the aforesaid authority.
6.
Proposed renewal of authority for the Company to purchase its own shares of up to 10% of (Resolution 7)
the issued and paid-up capital of the Company. [Ordinary Resolution]
"THAT subject to Section 67A of the Companies Act 1965 (the Act) and Part IIIA of the
Companies Regulations 1966, the provisions of the Memorandum and Articles of
Associations of the Company, the Main Market Listing Requirements (MMLR) of Bursa
Malaysia Securities Berhad ("Bursa Malaysia Securities"), and the approvals of the relevant
regulatory authorities, the Directors of the Company be and are hereby authorised to make
purchase(s) of ordinary shares of RM0.25 each in the Companys issued and paid-up share
capital on Bursa Malaysia Securities subject to the following:
140
ALAM MARITIM RESOURCES BERHAD (700849-K)
the maximum number of shares which may be purchased and/or held by the Company
shall be equivalent to 10% of the issued and paid-up share capital of the Company
(Shares) for the time being;
ii
the maximum fund to be allocated by the Company for the purpose of purchasing the
Shares shall not exceed the aggregate retained profits and share premium account of
the Company;
iii
the authority conferred by this resolution will commence immediately upon passing
of this ordinary resolution and, unless renewed by an ordinary resolution passed by
the shareholders of the Company in general meeting, will expire:
(a)
at the conclusion of the next Annual General Meeting (AGM) of the Company,
unless earlier revoked or varied by an ordinary resolution of the shareholders of
the Company in a general meeting; or
(b)
upon the expiration of the period within which the next AGM is required by the
law to be held;
whichever occurs first, but not so as to prejudice the completion of the purchase(s) by
the Company before the aforesaid expiry date and in any event, in accordance with the
provisions of the MMLR of Bursa Malaysia Securities or any other relevant
authority; and
iv
upon completion of the purchase(s) of the Shares by the Company, the Directors of the
Company be and are hereby authorised to deal with the Shares in the following
manner:
(a)
(b)
(c)
retain part of the Shares so purchased as treasury shares and cancel the
remainder; or
(d)
in any other manner as prescribed by the Act, rules, regulations and guidelines
pursuant to the Act and the requirements of Bursa Malaysia Securities and any other
relevant authority for the time being in force;
AND THAT the Directors of the Company be and are hereby authorised to take all steps as
are necessary or expedient to implement or to effect the purchase(s) of the Shares with full
power to assent to any conditions, modifications, variations and/or amendments as may be
imposed by the relevant authorities and to take all such steps as they may deem necessary
or expedient in order to implement, finalise and give full effect to the aforesaid authority.
7.
To transact any other business of which due notice shall be given in accordance with the
Companies Act 1965 and the Companys Articles of Association.
Notes:
1.
2.
The instrument appointing a proxy shall be in writing under the hand of the appointer or of his attorney duly authorised
in writing or, if the appointer is a corporation, either under Seal or under the hand of an officer or attorney duly
authorised.
3.
Except where Article 87 of the Companys Articles of Association applies, where two (2) proxies are appointed, the
appointment shall be invalid unless the proportion of shares to be represented by each proxy is specified.
4.
The instrument appointing proxies must be deposited at the registered office of the Company not less than forty-eight
(48) hours before the time for holding the meeting.
5.
At the Sixth AGM, the resolution on ordinary business in respect of the approval on payment of Non-Executive Directors
Remuneration will not be tabled since the necessary approval for payment of Directors Remuneration not exceeding
RM300,000 for ensuing financial year(s) were duly obtained at the Fourth AGM. Kindly refer to the Audited Financial
Statements for the year ended 31 December 2010 for details on Non-Executive Directors Remuneration.
6.
Authority to issue shares pursuant to Section 132D of the Companies Act 1965.
The proposed Ordinary Resolution, if passed will give Directors of the Company, authority to allot and issue shares
in the Company up to an amount not exceeding 10% of the total issued share capital of the Company for the time
being, for such purposes as the Directors consider would be in the best interest of the Company. This authority,
unless revoked or varied by the shareholders of the Company in general meeting will expire at the conclusion of
the next Annual General Meeting.
ii
Proposed renewal of authority for the Company to purchase its own shares.
The proposed Ordinary Resolution, if passed, is to empower the Directors to purchase the Companys shares of up
to 10% of the issued and paid-up capital of the Company by utilising the retained profits and the share premium
reserve of the Company.
Further information on the proposed Resolution 7 is set out in the Statement to shareholders dated 20 May 2011,
circulated together with the Companys 2010 Annual Report.
142
ALAM MARITIM RESOURCES BERHAD (700849-K)
Form of Proxy
No. of Shares
CDS Account No.
NRIC/Company No.
Tel & Fax No.
I/We .................................................................................................................................................................................................
(Block Letters)
of .....................................................................................................................................................................................................
being a member of ALAM MARITIM RESOURCES BERHAD hereby appoint :Name/CDS Account No
NRIC/Passport No
No of shares
Proxy 1
..............................................
....................................
............................
......................
or failing him/her
Proxy 2
..............................................
....................................
............................
......................
or failing him/her
Total
............................
100
THE CHAIRMAN OF THE MEETING as my/our* proxy(ies) to vote for me/us* and on my/our* behalf at the Sixth Annual General
Meeting of the Company to be held at 10.00 a.m. on Wednesday, 15 June 2011 at Ballroom 1, Sime Darby Convention Centre,
1A Jalan Bukit Kiara 1, 60000 Kuala Lumpur, and at any adjournment thereof, in the manner indicated below:
No Resolutions
For
To receive the Audited Financial Statement for the financial year ended 31 December
2010 and the Reports of Directors and Auditors thereon
To re-elect Puan Fina Norhizah binti Haji Baharu Zaman pursuant to Article 100
To appoint Messrs Ernst & Young as Auditors of the Company for the financial year
ending 31 December 2011
To approve the Ordinary Resolution pursuant to Section 132D of the Companies Act 1965
To approve the Ordinary Resolution on proposed renewal of authority for the Company
to purchase its own shares
Against
Please indicate with a check mark ( ) in the appropriate box against the resolution how you wish your proxy to vote. In
the absence of specific instructions, the proxy will vote or abstain at his/her discretion.
Date
Notes:
1.
2.
3.
4.
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STAMP
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