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Contents 02
Corporate Information

03

Corporate Structure Notice of Annual General Meeting Statement Accompanying Notice of Annual General Meeting Appendix I

04
06 07

09 12

Directors’ Profile Executive Chairman’s Statement

15 16 18 20 24

Corporate Social Responsibility Activities Audit Committee Report Statement on Internal Control Corporate Governance Statement Additional Compliance Statement

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73 74

Financial Statements List of Properties Analysis of Shareholdings Proxy Form

Corporate Information
Board Of Directors
1. 2. 3. 4. Chew Ting Leng Executive Chairman / Group Managing Director Goh Teoh Kean Group Deputy Managing Director Tan Ang Ang Executive Director To Tai Wai Executive Director 5. 6. 7. 8. Abdul Karim Bin Ahmad Non-Independent Non-Executive Director Tan Sui Hin Independent Non-Executive Director Loh Wei Tak Independent Non-Executive Director Saw Siew Ee Independent Non-Executive Director

Audit Committee
Chairman Tan Sui Hin Members Loh Wei Tak Goh Teoh Kean

Company Secretaries
Lim Seck Wah (MAICSA NO.: 0799845) Liang Siew Ching (MAICSA NO.: 7000168)

Principal Bankers
CIMB Bank Berhad Citibank Berhad EON Bank Berhad HSBC Bank Malaysia Berhad United Overseas Bank (Malaysia) Berhad Hong Leong Bank Berhad Affin Bank Berhad Standard Chartered Bank Malaysia Berhad

Remuneration Committee
Chairman Chew Ting Leng Members Tan Sui Hin Saw Siew Ee

Registered Office
Level 15-2, Faber Imperial Court Jalan Sultan Ismail 50250 Kuala Lumpur Tel: 03-26924271 Fax: 03-27325388

Solicitors
Adi Radlan & Co

Auditors
Shamsir Jasani Grant Thornton Chartered Accountants

Nomination Committee
Chairman Tan Sui Hin Members Loh Wei Tak Saw Siew Ee

Share Registrar
MEGA CORPORATE SERVICES SDN. BHD. (Company No.: 187984-H) Level 15-2, Faber Imperial Court Jalan Sultan Ismail 50250 Kuala Lumpur Tel No.: 03-26924271 Fax No. : 03-27325388

Stock Exchange Listing
Main Board of Bursa Securities Bursa Securities refers to Bursa Malaysia Securities Berhad STOCK CODE: 5125

Pg2

PANTECH GROUP HOLDINGS BERHAD (733607-W)

A n n u a l

R e p o r t

2 0 0 7

Corporate Structure Pantech Steel Industries Sdn Bhd 100% Pantech Corporation Sdn Bhd Panaflo Controls Pte Ltd 100% 100% Pantech (Kuantan) Sdn Bhd Jayee Holdings Sdn Bhd Tuah Nusa Sdn Bhd JC Flow Controls Pte Ltd 100% 100% 30% 70% A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg3 .

3 4. and if thought fit. and subject to the approvals of the relevant governmental and/or regulatory authorities. 2. Prince Hotel & Residence Kuala Lumpur. Level 3. to pass the following Ordinary Resolution: 6. To approve the payment of Directors’ fees for the year ended 28 February 2007.4 4. 4.7 5. 1965. the Directors be and are hereby empowered to issue new shares in the Company from time to time upon such terms and conditions and for such purposes as the Directors may deem fit provided that the aggregate number of shares issued pursuant to this resolution does not exceed 10% of the issued share capital of the Company as at the date of this AGM and that such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company and THAT the Directors be and are hereby also authorised to obtain the approval from Bursa Securities for the listing and quotation of the additional shares so issued. Jalan Conlay. To approve the payment of a First and Final Dividend of 3 sen per ordinary share of RM0. AS SPECIAL BUSINESS To consider.1 4.” 7. 10th August 2007 at 10. 50450 Kuala Lumpur. Resolution 2 To re-appoint Messrs Shamsir Jasani Grant Thornton as Auditors of the Company and to authorise the Directors to fix their remuneration.6 4. 1965 “THAT pursuant to Section 132D of the Companies Act. To receive the Audited Financial Statements for the financial year ended 28 February 2007 together with the Directors’ and Auditors’ Reports thereon. offered themselves for re-election: 4.50 each less 27% Malaysian Income Tax for the financial year ended 28 February 2007. SPECIAL RESOLUTION PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY “THAT approval be hereby given for the Articles of Association of the Company to be amended as per Appendix 1 in the Annual Report 2007 to conform with the enhanced Listing Requirements of Bursa Malaysia Securities Berhad” Resolution 12 Resolution 11 Pg4 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .Notice of Annual General Meeting NOTICE IS HEREBY GIVEN that the First Annual General Meeting of the members of the Company will be held at Prince 3.5 4. Mr Chew Ting Leng Mr Goh Teoh Kean Mr To Tai Wai Mr Tan Ang Ang Mr Loh Wei Tak Mr Tan Sui Hin Encik Abdul Karim Bin Ahmad Resolution 3 Resolution 4 Resolution 5 Resolution 6 Resolution 7 Resolution 8 Resolution 9 Resolution 10 Please refer to Note A Resolution 1 3. on Friday.00 am for the following purposes:AGENDA AS ORDINARY BUSINESS 1. AUTHORITY TO ISSUE SHARES BY THE COMPANY PURSUANT TO SECTION 132D OF THE COMPANIES ACT.2 4. To re-elect the following directors retiring pursuant to Article 127 of the Company’s Articles of Association and being eligible.

The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorized in writing or. will expire at the next Annual General Meeting of the Company. The item 1 of the Agenda is meant for discussion only as it does not require a formal approval of the shareholders and hence. is not put forward for voting A member entitled to attend and vote at the Meeting is entitled to appoint a proxy to attend and vote in his/her stead. Jalan Sultan Ismail. 12 on the Proposed Amendments to the Articles of Association of the Company are made to conform with the enhanced Listing Requirements of Bursa Malaysia Securities Berhad. By order of the Board LIM SECK WAH (MAICSA 0799845) LIANG SIEW CHING (MAICSA 7000168) Company Secretaries Dated this: 19 July 2007 Kuala Lumpur Notes A. in respect of ordinary transfers. it may appoint at least one (1) proxy in respect of each Securities account it holds with ordinary shares of the Company standing to the credit of the said securities account. Please refer to Appendix 1 in the Annual Report 2007 for details of the Proposed Amendments. Where a member is an authorised nominee as defined under the Security Industry (Central Depositories) Act. 5.50 each for the financial year ended 28 February 2007 will be paid on 17 September 2007 to Depositors registered in the Record of Depositors at the close of business at 5. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg5 . a First and Final Dividend of 3 sen less 27% Malaysian Income Tax per ordinary share of RM0. This authority.Notice of Annual General Meeting NOTICE OF DIVIDEND ENTITLEMENT AND PAYMENT Subject to the approval of the shareholders. unless revoked or varied by the Company at a general meeting. if the appointer is a corporation. 1.00 pm on 30 August 2007.11 is primarily to give flexibility to the Board of Directors to issue and allot shares at any time in their absolute discretion up to and not exceeding in total ten per centum (10%) of the issued share capital of the Company as at the date of this AGM for such purposes as they consider would be in the best interest of the Company without convening a general meeting. A depositor shall qualify for entitlement only in respect of: a) Shares transferred into the Depositor’s Securities Account before 4. 1965 shall not apply. 3. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy without limitation and the provisions of Section 149(1)(b) & (c) of the Companies Act. 1991. Explanatory Notes on Special Businesses: Ordinary Resolution 11 The proposed Ordinary Resolution no.00 pm on 30 August 2007. 4. Special Resolution 12 The proposed Special Resolution no. 2. The Form of Proxy must be deposited at the Registered Office of the Company at Level 15-2. either under the Corporation’s Common Seal or under the hand of an officer or attorney so authorized. Faber Imperial Court. 50250 Kuala Lumpur not less than 48 hours before the time set for holding the meeting or any adjournment thereof. and b) Shares bought on Bursa Securities on a cum entitlement basis according to the Rules of the Bursa Securities. A member may appoint up to two (2) proxies to attend the same meeting provided that he specifies the proportion of his shareholding to be represented by each proxy.

3. Saves for Madam Saw Siew Ee. Further details of the above Directors are set out in the Profile of Directors on page 9 to 11 of this Annual Report and the Statement of Directors’ shareholdings on page 74 of this Annual Report. all Directors are subject to retire at the First AGM. Mr Chew Ting Leng Mr Goh Teoh Kean Mr To Tai Wai Mr Tan Ang Ang Mr Loh Wei Tak Mr Tan Sui Hin Encik Abdul Karim Bin Ahmad Resolution 3 Resolution 4 Resolution 5 Resolution 6 Resolution 7 Resolution 8 Resolution 9 Madam Saw Siew Ee. 2. 7. 6.Statement Accompanying Notice of Annual General Meeting Directors Standing for Re-election Pursuant to Article 127. The Directors who are standing for re-election at the First Annual General Meeting of the Company are as follows:1. Pg6 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . offer themselves for re-election. the Independent Non-Executive Director does not wish to offer herself for re-election. 4. all the other Directors being eligible. 5.

the Company shall. as the case may be. Article 2 (Definition) EXISTING PROVISIONS Approved Market Place A stock exchange which is specified to be an approved market place in the Securities Industry (Central Depositories) Exemption Order (No. permit a transmission of Securities held by such Securities holder from the register of holders maintained by the registrar of the Company in the jurisdiction of the Approved Market Place (hereinafter referred to as “the Foreign Register”). (1) Where: (a) the Securities of the Company are listed on another stock exchange. upon request of a Securities holder. under the Rules of Depository in respect of such Securities. (1) Where: (a) the Securities of the Company are listed on an Approved Market Place.Appendix I PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY ARTICLE NO. the Company shall. under the Rules of Depository in respect of such Securities. Transmission of Securities 42. 2) 1998 as may be amended. to the register of holders maintained by the registrar of the Company in Malaysia and vice versa provided that there shall be no change in ownership of the Securities. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg7 . modified or altered from time to time. and (b) the Company is exempted from compliance with Section 14 of the Central Depositories Act or Section 29 of the Securities Industry (Central Depositories) (Amendment) Act 1998. permit a transmission of Securities held by such Securities holder from the register of holders maintained by the registrar of the Company in the jurisdiction of the other stock exchange. Issue of preference shares The total nominal value of preference shares issued shall not exceed the total nominal value of the issued ordinary shares at any time. as the case may be. and (b) the Company is exempted from compliance with Section 14 of the Securities Industry (Central Depositories) Act 1991 or Section 29 of the Securities Industry (Central Depositories) (Amendment) Act 1998. 3(A)(3) The holders of preference shares must be entitled to a return of capital in preference to holders of ordinary shares when the Company is wound up. upon request of a Securities holder. to the register of holders maintained by the registrar of the Company in Malaysia (hereinafter referred to as “the Malaysian Register”) subject to the following conditions: To be deleted To be deleted AMENDED PROVISIONS Article 3(A)(1) To be deleted Article 42 Transmission of Securities 42.

Subject to the Listing Requirements.Appendix I PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY (CONT’D) ARTICLE NO. whichever is higher. Directors Until otherwise determined by the Company in general meeting. a holder of ordinary shares or preference shares is personally present and entitled to vote shall be entitled to 1 vote. to issue a Record of Depositors as at a latest date which is reasonably practicable which shall in any event be not less than three (3) Market Days before the general meeting (hereinafter referred to as the “General Meeting Record of Depositors”) New provision to be inserted immediately after Article 77 (4) Voting Rights on a Show of Hands On a resolution to be decided on a show of hands. whichever is higher. the number of Directors including a Managing Director shall not be less than two (2) but not more than twelve (12). it shall not allow any transmission of Securities from the Malaysian Register into the Foreign Register Article 71 (3) General Meeting Record of Depositors The Company shall request the Depository in accordance with the Rules of Depository. Article 97 Directors All the Directors of the Company shall be natural persons and. where the Company fulfils the requirements of sub-paragraphs (a) and (b) of Article 42(1) above. Pg8 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . at least two (2) Directors or one third (1/3) of the Board of Directors. EXISTING PROVISIONS (i) there shall be no change in ownership of the Securities. shall be Independent Directors. to issue a Record of Depositors as at a date not less than three (3) Market Days before the general meeting (hereinafter referred to as the “General Meeting Record of Depositors”) New Article 77 (5) To be deleted AMENDED PROVISIONS General Meeting Record of Depositors The Company shall request the Depository in accordance with the Rules of Depository. at least two (2) Directors or one third (1/3) of the Board of Directors. the number of Directors including a Managing Director shall not be less than two (2) but not more than twelve (12). until otherwise determined by the Company in general meeting. (ii) the transmission shall be executed by causing such shares or securities to be credited directly into the securities account of such Securities holder (as may be applicable). (2) For the avoidance of doubt. shall be Independent Directors. Subject to the Listing Requirements.

He has no family relationship with other directors or major shareholders of PGHB. He has more than 19 years experience in the PFF solutions industry. aged 52. was appointed as an Executive Director on 11 November 2006.Directors’ Profile CHEW TING LENG Executive Chairman / Group Managing Director Mr. TAN ANG ANG Executive Director Mr Tan Ang Ang. He does not hold any directorships in any other public companies. He was appointed as Group Managing Director and Executive Chairman of Pantech Group Holdings Berhad (PGHB) on 11 November 2006 and 13 November 2006 respectively. He is responsible for the overall operation and performance of the Group’s manufacturing business. is one of the co-founders of the Group. graduated with Diploma in Commerce (Financial Accounting) from Tunku Abdul Rahman College. aged 51. He has no conflict of interest with PGHB and has no convictions of offences other than traffic offences within the past ten years. He has more than 30 years experience in the PFF solutions industry. He has no family relationship with other directors or major shareholders of PGHB. He does not hold any directorships in any other public companies. aged 50. He has no family relationship with other directors or major shareholders of PGHB. He is one of the co-founders of the Group and was appointed as the Group Deputy Managing Director on 11 November 2006. He is responsible for the financial and administrative functions of the Group. He has no conflict of interest with PGHB and has no convictions of offences other than traffic offences within the past ten years. a Malaysian. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg9 . He obtained his professional Diploma from the Chartered Institute of Marketing in 1989. GOH TEOH KEAN Group Deputy Managing Director Mr Goh Teoh Kean. a Malaysian. He does not hold any directorships in any other public companies. a Malaysian. He has no conflict of interest with PGHB and has no convictions of offences other than traffic offences within the past ten years. He is also the Managing Director of Pantech Steel Industries Sdn Bhd. He is a member of the Audit Committee. Chew Ting Leng. He is the Chairman of the Remuneration Committee. He is not a member of any board committee.

was appointed as a Non-Independent Non-Executive Director of PGHB on 30 November 2006 representing the interest of Koperasi Permodalan Felda Berhad (KPFB). ABDUL KARIM BIN AHMAD Non-Independent Non-Executive Director Encik Abdul Karim Bin Ahmad. was appointed as an Independent Non-Executive Director of PGHB on 30 November 2006. He is presently the Regional General Manager for Felda Trolak’s Regional Office in Perak. He has no conflict of interest with PGHB and has no convictions of offences other than traffic offences within the past ten years. a Malaysian. He is primarily responsible for the domestic and international sales activities of the Group’s trading division. a Malaysian. He has no conflict of interest with PGHB and has no convictions of offences other than traffic offences within the past ten years. He has no family relationship with other directors or major shareholders of PGHB. He does not hold any directorships in any other public companies. aged 56. He does not hold any directorships in any other public companies. He is the Chairman of both the Audit and the Nomination Committee. aged 35. He is also a member of the Remuneration Committee. He is not a member of any board committee. He has no conflict of interest with PGHB and has no convictions of offences other than traffic offences within the past ten years. He graduated with a Diploma in Mechanical Engineering from Ungku Omar Polytechnic in 1971. He graduated with a Bachelor Degree in Economics (Honours) from University Kebangsaan Malaysia in 1978. He has no family relationship with other directors or major shareholders of PGHB. To Tai Wai. He has been with Pantech Corporation Sdn Bhd since 1989. aged 52. was appointed as an Executive Director on 11 November 2006. TAN SUI HIN Independent Non-Executive Director Mr Tan Sui Hin. He is not a member of any board committee. Pg10 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . He does not hold any directorships in any other public companies. He has more than 35 years experience in the building engineering field.Directors’ Profile TO TAI WAI Executive Director Mr. He has no family relationship with other directors or major shareholders of PGHB. a Malaysian.

A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg11 . she returned to Malaysia and worked as a research analyst. No Board of Directors meeting was held for the financial year ended 28 February 2007. He completed his Bachelor of Business Degree (Majoring in Accounting) from Monash University. She graduated from University of Keele in 1987 with a degree in Computer and Management Science. She is a licensed Dealer’s Representative with CIMB Investment Bank Bhd since 1994. was appointed as an Independent Non-Executive Director of PGHB on 30 November 2006. The Company was granted listing on the Main Board of Bursa Malaysia Securities Berhad on 15 February 2007. SAW SIEW EE Independent Non-Executive Director Madam Saw Siew Ee. Australia in 1994 and obtained his status as a Certified Practicing Accountant from Australia in 1998. was appointed as an Independent Non-Executive Director of PGHB on 30 November 2006. He is a member of the Audit and Nomination Committees. he was admitted as a Chartered Accountant to the Malaysian Institute of Accountants prior to obtaining his status as a Certified Public Accountant from the Institute of Certified Public Accountants of Singapore in 2001. In 1989. a Malaysian. She is a member of the Remuneration and Nomination Committees. He has no conflict of interest with PGHB and has no convictions of offences other than traffic offences within the past ten years.Directors’ Profile LOH WEI TAK Independent Non-Executive Director Mr Loh Wei Tak. She has no family relationship with other directors or major shareholders of PGHB. He has no family relationship with other directors or major shareholders of PGHB. In 2000. Upon her graduation. a Malaysian. She has no conflict of interest with PGHB and has no convictions of offences other than traffic offences within the past ten years. She does not hold any directorships in any other public companies. He does not hold any directorships in any other public companies. He is a qualified accountant and a member of the Malaysian Institute of Accountants. Melbourne. she began her career as an audit junior. aged 33. aged 42.

which are crucial to improving shareholder value. flow controls (PFF) solutions in our stable. Needless to say. It is with great pleasure that the Board of Directors and I present this inaugural Annual Report and the audited financial statements for the Financial Year ended 28 February 2007. grades. India and Indonesia. We have added new countries to our export base.000 product items based on various sizes. Pantech Group’s strength lies in the fact that we offer more than 20. long-term shareholder base to grow with us to greater heights. it is clear that we have made very good progress in our manufacturing sector. these countries offer tremendous market potential for our range of PFF. As a public listed company. and our order book is strong. This amount comprises RM12 million obtained from the IPO proceeds and RM9 million from internal funds. fittings. Pantech Group has earmarked approximately RM21 million over the next two years to increase our storage facilities and manufacturing production area. We certainly view our role as a public listed company very seriously and we intend to secure a loyal. Our income is derived from two main sources namely from our manufacturing and trading operations. As the Executive Chairman of the Board. In reviewing the past financial year. Pantech Group stands to benefit from rising demand for PFF solutions. The “New Era” dawned when Pantech Group was admitted to the Main Board of Bursa Malaysia Securities Berhad on 15 February 2007. Having been in business since 1987. namely Mexico. In anticipation of the increased demand for our PFF products.Executive Chairman’s Statement “Rising to the challenge of a New Era” SMB Recognition Award Pantech Steel Industries Sdn Bhd Winner of Export Excellence Award 2006 Dear shareholders. In line with this. we have strengthened our resolve and commitment to increasing revenue and expanding market share. and to buy machinery and other equipment. category and brand names for various pipes. I am excited to share that the construction has begun on a new factory in Klang and work is expected Pg12 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . types. Over 50% of the Group’s sales currently come from oil & gasrelated customers. As more exploration and production works in the oil & gas sector are carried out. I am excited to share with you the progress and achievements Pantech Group has made over the years.

Executive Chairman’s Statement to be completed by second half year of 2007. We have also leased seven acres of land in Port Klang Free Zone to provide additional storage space. Ageing oil & gas platforms globally are also expected to create replacement demand for our products. Malaysia is expected to follow suit with both onshore and offshore developments progressing at a strong pace. we estimated the Group’s proforma revenue for the Financial Year ending 28 February 2007 at RM216 million. Bearing in mind that pipes. This new plant will give us additional manufacturing capacity and support our objective of increased production and wider market penetration. will cater to the A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg13 . Pantech Group aims to tap this market as well. An additional growth driver is our business plan to widen the Group’s product range. I am pleased to inform shareholders that due to burgeoning oil and gas activities. We also use High Frequency Induction (HFI) technology in the manufacturing of some of our products. The bio-diesel industry in Malaysia is another potential growth area for us. fittings and flow control solutions and products will be utilized to set-up these bio-diesel plants. Our strength lies in our ability to supply PFF to our customers’ specifications. which exceeded our estimate by approximately 9. exceeding our estimate by 12.76 million. making up approximately 58% of overall sales last financial year. which makes us a market leader in Malaysia in these items. our biggest contributor is pipes. our proforma group revenue this financial year in review stood at RM243 million. According to a local research house. as many as 65 to 70 platforms will be required in Malaysian waters over the next 5 years as development moves further offshore and towards deepwater. which include niche items that offer higher profit margins. In terms of product breakdown.5%. off Malaysian waters in 2006. These new products. the number of bio-diesel licences approved has been increasing and more plants are expected to come on stream soon. According to the same report. Business Outlook and Strategies With high oil prices and as more exploration and production works in the oil & gas sector are carried out globally.15%. Group Results When we launched our IPO prospectus on 29 January 2007. Pantech Group is well poised to take advantage of the opportunities offered via this continuing and growing demand for efficient means to transport the oil & gas. while maintaining strict quality compliance with the specifications of the international quality standards for oil and gas industries. This increase is attributed mainly to new projects secured during the previous and current financial years. We were able to translate this higher revenue to a profit after tax of RM26. about RM16 billion was poured into exploration and production activities carried out.

To this end. The net dividend distributable for the financial year ended 28 February 2007 will be RM3. Corporate Governance To ensure transparency. KNM. Our statement on corporate governance and related reports are on pages 16 to 23. we have already started manufacturing concentric reducers (from 8” to 12”). We are also supplying to fabrication giants like Keppel and SembCorp Marine of Singapore. Sime Engineering and Malaysian International Trading Corporation (Japan) . accountability and protection of shareholders’ interests. staff. the Board places great importance in ensuring that the highest standard of corporate governance is practiced throughout the Group.Executive Chairman’s Statement changing needs of our growing customer base. tees and reducers in sizes that are very customer-centric. Chew Ting Leng (Jimmy) Executive Chairman/Group Managing Director Pg14 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . We do not plan to sit on our laurels. caps. I am pleased to inform shareholders that we have secured more deals with Keppel FELS Group to supply our fittings and Hot Induction Long Bend. Pantech Group has a large. Related Party Transactions Significant related party transactions of the Group for the year under review are disclosed in Note 28 to the financial statements. Thank you. subject to the approval of shareholders at the forthcoming Annual General Meeting of the company. elbows. Dividends The Board has declared an annual dividend of 3 sen per share less 27% tax. and we plan to manufacture long bends. management the various Board committees and our business partners who have displayed commendable commitment and dedication to the company. diversified and established clientele base of more than 500 recurring customers with major customers like Kencana. The continued success of Pantech Group is due to each one of you. Malaysia Marine and Heavy Engineering. Acknowledgements The Board would sincerely like to thank all shareholders. Ramunia. to maintain our status as a “one-stop solutions centre”.285 million. The new era we have embarked on promises to be challenging and rewarding for all who are committed to taking this journey with us.

The Group encourages active participation from all level of staff by constant organising in house and outdoor events such as family day. is also committed to promote corporate social responsibilities as integral part of the Group. In view of this. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg15 . the Board of Directors has built a stronger bond with its employees and let the employees have a sense of belongings in the group. whilst pursuing business growth to enhance shareholders and stakeholders value. Through the organized programs. 2) Requiring contractors to abide to health and safety rules either on its premises or performing work on our behalf. The Policy generally prescribes guidelines mainly on the followings:1) To promote employees health and safety through provision of suitable protective equipment and appliances for employees’ use at their respective workplace. the Group has implemented Policy on Health and Safety at Work and Protection of the Environment at the manufacturing plant.Corporate Social Responsibility Activities The Board of directors of the Company. Pantech Group recognizes the importance of maintaining workplace safety and health as it has impact on all employees’ morale and productivity. The Group is committed towards providing a conductive and caring working environment for the employees. Various trainings are provided to motivate the employees and to upgrade their skills. The Board of Directors values the contribution from employees which attributes to the success of Pantech Group.

3 Notice of Meeting and Attendance The agenda for Audit Committee meetings shall be circulated before each meeting to members of the Committee.Audit Committee Report The Audit Committee was formed by the Board of Directors on 1st December 2006.2 Membership The Audit Committee shall be appointed by the Board of Directors from among their members and shall comprise of not less than 3 members of whom a majority shall be independent non-executive directors. the Board of Directors shall.1 Constitution The Audit Committee was formed pursuant to a resolution passed by the Board of Directors on 1st December 2006. Loh Wei Tak (Independent Non. A quorum shall be 2 members. 2. TERMS OF REFERENCE OF THE AUDIT COMMITTEE 2. The Company Secretary of the Company shall be the Secretary of the Committee. dies or for any other reason ceases to be a member with the results that the number is reduced below 3. within 3 months of that event.Executive Director) Members Mr. Pg16 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . The Committee shall be empowered to retain persons having special competence as necessary to assist the Committee in fulfilling its responsibilities.4 Authority The Audit Committee is authorised to investigate any activity of the Company within its terms of reference and all employees shall be directed to co-operate with any request made by the Committee. The members of the Audit Committee shall elect a chairman from among their members who is not an executive director or employees of the Company or any related corporation. 2. COMPOSITION Chairman Mr. 2. appoint such number of new members as may be required to make up the minimum number of 3 members. The Committee may require the external auditors and any official of the Company to attend any of its meetings as it determined.Executive Director) Mr. Goh Teoh Kean (Group Deputy Managing Director) 2. 1. If a member of the Audit Committee resigns. The chairman elected shall be subjected to endorsement by the Board. Tan Sui Hin (Independent Non. The external auditors shall have the right to appear and be heard at any meeting of the Audit Committee and shall appear before the Committee when required to do so by the Committee.

act upon the Board of Directors’ request to investigate and report on any issues or concerns in regard to management of the Group. to oversee all matters pertaining to audit including the review of the audit plan and report. and to consider other matters. and in particular review the external auditors management letter and management’s response. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg17 .Audit Committee Report 2. the audit fees and any question of resignation or dismissal. • SUMMARY OF ACTIVITIES DURING THE FINANCIAL YEAR There is no Audit Committee meeting held during the financial year ending 28 February 2007 since the Company was listed on the 15 February 2007.5 Duties And Responsibilities The duties and responsibilities of the Audit Committee shall be:• • • • to consider the appointment of the external auditors. and any matters the external auditors may wish to discuss (in the absence of management where necessary). to discuss problems and reservations arising from the interim and final results. as defined. to keep under review the effectiveness of internal control systems.

effectiveness and adequacy of the control mechanism are monitored and maintained throughout the financial period. The Board also recognises the need for a concerted effort from the management. 5) To ensure subsidiary companies. monitoring and managing significant risks that may affect the Group in achieving its business objectives. The Board recognises the need for implementing an on-going process of identifying. The internal control elements established by the Board with the management includes:1) The responsibilities of the Board and management are clearly defined to ensure the effective discharge of the roles and responsibilities. divisions and employees are working coherently to achieve the Group’s overall business objectives. ENTERPRISE RISK MANAGEMENT FRAMEWORK The Group plans to engage a professional firm to assist in establishing a formal risk management framework.Statement on Internal Control The Malaysian Code on Corporate Governance stipulates that the Board of Directors of a listed company should maintain a sound system of internal control to safeguard shareholders’ investment and the Company’s assets. KEY ELEMENTS OF THE GROUP’S INTERNAL CONTROLS The Group’s structured segregation of duties and reporting mechanism provides an effective monitoring tool and operational procedures in ensuring the followings:• The Group’s compliance to applicable laws and requirements • The ability of senior managers and advisors to identify. 4) Key personnel from respective subsidiary companies provide monthly reports to the corporate office on the subsidiaries’ performance. BOARD RESPONSIBILITY The Board acknowledges its responsibility for the Group’s system of internal control and for reviewing adequacy and integrity of the system on an on-going basis. This Statement on Internal Control is made pursuant to paragraph 15. The system is designed to manage rather than eliminate the risk of failure to achieve business objectives.24 of the Listing Requirements and Recommended Practice Guide 5 (“RPG 5”) issued by the Malaysian Institute of Accountants. head of department and senior staff members in ensuring that the integrity. 2) The Management reports to the Board on material findings and/or variances. loss and fraud. RPG 5 does not require the external auditors to form an opinion on the effectiveness of the Group’s risk and control procedures or if this Statement covers all risks and controls. The Board also takes into consideration the need to balance the business risks and the potential returns to stakeholders in its daily operations. and the Board will review their implications to the Group and advise accordingly. the Group has requested that the external auditors to review this Statement in accordance to paragraph 15. business review/ planning and control management. evaluating. compliance and strategic plans. operations and long term plans. The system of internal control covers not only financial controls but operational and compliance controls as well. if any.27 (b) of the Listing Requirements of Bursa Malaysia Securities Berhad. The Board is pleased to note that external auditors find this Statement to be consistent with their understanding of the internal control processes implemented by the Group during their review. business units. with the dynamic business climate it operates in. corporate policies and procedures of the Group are clearly documented and also disseminated through internal memorandums. manage and mitigate current or future events that may affect the Group’s objectives. In addition. Pg18 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . and can only provide reasonable but not absolute assurance against material misstatement. 3) Management meetings are attended by senior management personnel at regular intervals to specifically address operational issues. staff briefings and operational meetings. budgets. performance.

The Group plans to engage a professional firm to carry out internal audit for the Group. INTERNAL CONTROL SUMMARY The Group continuously evaluates and improves on its control dynamism in ensuring its effectiveness and relevance in preserving the Group’s interest and assets. Presently. There is no material internal control failures occurred during the financial period that could have resulted in material losses or contingencies. Internal audit charter and plan will be submitted to the Audit Committee for approval prior to the commencement of internal audit. the Group does not have an in-house internal audit department. The Board is of the opinion that the internal control system in place is adequate at its current level of operations and will continue to review this system going forward.Statement on Internal Control 6) Close and active involvement of the Executive Directors in the day-to-day business operations of the Group. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg19 .

Directors’ Training All the Directors of the Company have attended the Mandatory Accreditation Programme conducted by Bursatra Sdn Bhd (Formerly known as Bursa Malaysia Training Sdn Bhd) within the stipulated timeframe as prescribed in the Listing Requirements. two (2) Executive Directors and four (4) non-executive directors. For this reason.02 of the Bursa Securities Listing Requirements. the presence of Independent Non-Executive Directors brings and additional element of balance to the Board. one (1) Group Deputy Managing Director.Corporate Governance Statement The Board of Directors (“the Board”) of Pantech Group Holdings Berhad supports the objectives of the Malaysian Code on Corporate Governance (“the Code”) and also acknowledges their roles in ensuring that shareholders’ interest are properly looked after. strategic planning. There was no Board of Directors Meeting being held for the financial year ending 28 February 2007. v. Besides providing valuable financial and business inputs. advice and judgment in compliance with Paragraph 15. An election of the retiring Directors shall take place every year. the Board of Directors is committed in maintaining highest standard of corporate governance pursuant to the Code. However. formulation of policies and overseeing the investments and business of the Company. Pg20 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . ii. the Board is of the opinion that there is a balanced view at all deliberations due to the presence of at least 1/3 Independent non-executive Directors who are unbiased and provide independent views. A. either to fill a casual vacancy or as an addition to the existing Directors shall hold office only until the conclusion of the next annual general meeting. and shall be eligible for re-election but shall not be taken into account in determining the Directors who are to retire by rotation at that meeting. a retiring Director is eligible for re-election at the meeting at which he or she retires. Board Balance The Board currently consists of eight (8) members. whilst taking into account the interest of other stakeholders. The Board has overall responsibility for corporate governance. Although all the Directors have an equal responsibility for the Company’s operations. comprising of an Executive Chairman who is also the Group Managing Director. Appointment and Re-election of Directors According to the Articles of Association of the Company. Any person appointed as a Director. iii. these Independent Directors have the caliber to exert influence in the Board’s decision. BOARD OF DIRECTORS i. Meetings The Company was granted listing on the Main Board of Bursa Malaysia Securities Berhad on 15 February 2007. The Board of Directors The Group is lead by an effective Board which controls the activities of the Group. The Board of Directors has complied with the Best Practices in Corporate Governance except that the Chairman also holds an Executive position as Group Managing Director. one-third (or the number nearest to onethird) of the Directors are required to retire from office at each annual general meeting. iv. Further. Although of combined roles. all the Directors are required to retire from office at least once in every three (3) years. The Group will continue to endeavor to comply with all the key Principles and Best Practices of the Malaysian Code on Corporate Governance in its effort to maintain shareholders value. This Corporate Governance Statement contained the principles and practices of the Code that the Group has adhered to.

at the expense of the Company.001 – 350. the individuals concerned would abstain from discussion of their own respective remuneration. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg21 . The Level and Make-Up of Remuneration The aggregate Directors’ remuneration for the financial year ended 28 February 2007 are set out below: Remuneration (RM) 866. is as below:Range of Remuneration (RM) 50. The Board will attend some relevant seminars/ training programme deemed appropriate for the Directors.000 and below 100. ii Procedure The Remuneration Committee is responsible for. by referring to the KPI and market survey as necessary. In the event an Executive Director is a member of the Remuneration Committee. whenever necessary.000 200. analysed in the following bands. In the case of non-executive directors.000 150. recommending to the Board the remuneration of all of the Executive Directors in all its forms.096 Executive Directors Non-Executive Directors Total The remuneration paid to the Directors.Corporate Governance Statement v. All Directors have access to all information of the Company on a timely basis in an appropriate form and quality necessary to enable them to discharge their duties and responsibilities. Directors’ Training (cont’d) The Board of Directors is aware of the importance of continuous education programme to enhance and safeguard shareholders’ value. the level of remuneration shall reflect the experience and level of responsibilities undertaken by the non-executive directors concerned. among others. The Remuneration Committee is entrusted under its terms of reference to assist the Board.596 25. B.001 – 150. vi.500 892.001 – 250.000 300. Nonetheless. then he or she would not be part of the decision making process to arrive at his or her own remuneration.000 Executive 1 1 1 1 Non-Executive 4 - There is no service contract made between any Director and the Company or its subsidiary companies.001 – 200. All Directors have access to the advice and services of the Company Secretary and to obtain independent professional advice. DIRECTOR’S REMUNERATION i. Supply of Information The Board members are updated on the Company’s activities and its operations on a regular basis. The determination of remuneration packages of non-executive directors would be a matter for the Board as a whole. The Remuneration Committee shall ensure that the levels of remuneration are sufficient to attract and retain Directors of the quality required to manage the business of the Group.

Statement of Directors’ Responsibility for Preparing Financial Statements The Board is responsible to ensure that the financial statements are properly drawn up in accordance with the provisions of the Companies Act 1965 and approved accounting standards in Malaysia so as to give a true and fair view of the state of affairs of the Group as at the end of the financial year and of the results and cash flows of the Group for the financial year then ended. The Directors are responsible for ensuring that the Group keeps sufficient accounting records to disclose with reasonable accuracy. Pg22 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . The financial statements have been prepared on the going concern basis. A statement by the Directors of their responsibilities in the preparation of financial statements is set out in the ensuing section. General Meetings The Company’s Annual General Meeting (“AGM”) serves as a principal forum for dialogue with shareholders. it will be undertaking its full roles and responsibilities in the upcoming financial year. timely and adequate information to the investors and shareholders through annual report. circulars to shareholders and press release. ACCOUNTABILITY AND AUDIT i. Extraordinary General Meeting is held as and when required. D. The Directors also consider that all applicable approved accounting standards have been followed in the preparation of the financial statements. The Directors are satisfied that in preparing the financial statements of the Group for the year ended 28 February 2007. ii. prudently and reasonably. subject to any material departures being disclosed and explained in the notes to the financial statements. Dialogue with Investors The Board recognizes the values of the dialogue with investors and shareholders and the importance of accountability to them. As such. Shareholders are encouraged to meet and communicate with the Board at the AGM and to vote on all resolutions. 1965.Corporate Governance Statement As the Remuneration Committee was recently established. SHAREHOLDERS i. the Board is disseminating proper. ii. Financial Reporting The Directors are responsible to present a true and fair assessment of the Group’s position and prospects in the annual reports and quarterly reports. The members of the Remuneration Committee are listed below:Chairman Chew Ting Leng (Executive Chairman/Group Managing Director) Members Tan Sui Hin (Independent Non-Executive Director) Saw Siew Ee (Independent Non-Executive Director) C. announcements. the financial position of the Group and which enable them to ensure that the financial statements comply with the Companies Act. The matter will be further enhanced in the forthcoming year. The quarterly financial results were reviewed by the Audit Committee and approved by the Board of Directors prior to submission to Bursa Malaysia Securities Berhad. the Group has adopted suitable accounting policies and applied them consistently.

The Audit Committee met with the external auditors to discuss their audit plan. Directors’ Responsibility Statement on Annual Audited Accounts The Directors are required by the Companies Act. 1965 to prepare financial statements for each financial year which are made in accordance with the applicable approved accounting standards in Malaysia and to give a true and fair view of the state of affairs of the Company and of the Group as at the end of each financial year and of the result and cash flows of the Company and of the Group for the financial year end. Relationship with the Auditors The Board has established a formal and transparent arrangement for maintaining appropriate relationships with the external auditors in seeking professional advice and ensuring the compliance with the appropriate accounting standards. Compliance Statement The Company is committed in achieving high standards of corporate governance throughout the Group and to the highest level of integrity and ethical standards in all its business dealings. the Company has not set up the internal audit department for the financial year ending 28 February 2007. audit findings and the financial statements. v. The Board has an overall responsibility to have a sound internal control system. Internal Control As the Company was only listed on 15 February 2007.Corporate Governance Statement iii. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg23 . vi. The Board is aware on the importance of maintaining a sound internal control system that provides reasonable assurance of effective and efficient operations and compliance with internal procedures and guidelines. iv. The Board considers that the Company has complied with the principles and best practices as set out in parts 1 and 2 respectively of the Code.

12. 3. 11. 6. comprising 150. the entire enlarged issued and paid-up share capital of the Company.000 9.800. 5. SHARE BUY-BACK There were no share buy-back arrangements during the financial year.460 Balance RM’000 12. VARIANCE IN PROFIT ESTIMATE. IMPOSITION OF SANCTIONS / PENALTIES There were no public impositions of sanctions or penalties imposed on the Company and its subsidiaries.140 (b) 2. PROFIT GUARANTEE The Company did not give any form of profit guarantee to any parties during the financial year. 7. UTILISATION OF PROCEEDS FROM CORPORATE EXERCISE (a) Initial Public Offering On 15 February 2007.600 Actual Utilisation 28-02-2007 RM’000 9. warrants or convertible securities exercised in respect of the financial year.Additional Compliance Statement 1. MATERIAL CONTRACTS AND CONTRACTS RELATING TO LOANS There were no contracts relating to loan and material contracts of the Company and its subsidiaries involving the Directors and substantial shareholders since the end of the previous financial year.50 each were listed on the Main Board of Bursa Securities. WARRANTS OR CONVERTIBLE SECURITIES There were no options. Utilisation of IPO Proceeds Proposed Utilisation Purpose Capital Expenditure Working Capital Listing expenses RM’000 12. 4. directors or management by the regulatory bodies during the financial year.000 ordinary shares of RM0. 8. OPTIONS. RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE AND TRADING NATURE There is no Recurrent Related Party Transactions entered during the financial year.360 11. FORECAST OR PROJECTION The variance between the actual audited and forecast profit after tax for the financial statement ended 28 February 2007 was below 10% VARIANCE IN RESULTS There is no significant variance between the profit after taxation for the financial year and the Fourth Quarter unaudited results announced by the Company. NON-AUDIT FEES The amount of non-audit fees incurred for services rendered to the Company and its subsidiaries during the financial year ended 28 February 2007 by Shamsir Jasani Grant Thornton was RM167.100 2. Pg24 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .100 2.000 140 12. AMERICAN DEPOSITORY RECEIPT (“ADR”) /GLOBAL DEPOSITORY RECEIPT (“GDR”) The Company did not sponsor any ADR or GDR programmes during the financial year. 9.500 23.000. Please refer to Notes 3(e) to the Financial Statement on page 46. 10. REVALUATION POLICY ON LANDED PROPERTIES There were revaluation policies on landed properties adopted by the Group during the financial year under review.

Financial Statements Directors’ Report Statement by Directors and Statutory Declaration Report of the Auditors Balance Sheets Income Statements Statements of Changes in Equity Cash Flow Statements Notes to the Financial Statements 26-30 31 32-33 34-35 36 37 38-40 41-72 .

associate company and joint venture are disclosed in Notes 11.285. FINANCIAL RESULTS Group RM Net profit for the financial period Attributable to:Equity holders of the Company 26. 12 and 13 to the Financial Statements respectively. PRINCIPAL ACTIVITIES The Company is principally engaged in investment holding and provision of management services. will be accounted for in equity as an appropriation of retained earnings in the financial year ending 28 February 2008. Pg26 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .634.000 will be proposed for shareholders’ approval. There have been no significant changes in the nature of these activities of the Company.866 Company RM 3. in respect of the financial period ended 28 February 2007. of 3 sen less 27% income tax per ordinary share on 150.757.000.000 ordinary shares amounting to a dividend payable of RM3.118 26. Such dividend. a final dividend.866 3. if approved by the shareholders.DIRECTORS’ REPORT The Directors of Pantech Group Holdings Berhad have pleasure in submitting their report together with the audited financial statements of the Group and of the Company for the financial period from 15 May 2006 (date of incorporation) to 28 February 2007. The financial statements for current financial period do not reflect this proposed dividend.757. RESERVES AND PROVISIONS There were no material transfers to or from reserves or provisions during the financial period other than those disclosed in the financial statements.634. The principal activities of the subsidiary companies.118 DIVIDENDS There were no dividends paid or declared by the Company since the date of its incorporation. At the forthcoming Annual General Meeting. associate company and joint venture during the financial period. its subsidiary companies.

5.12.50 0.000.2006 10. will or may affect the ability of the Group and of the Company to meet its obligations as and when they fall due. (b) At the date of this report.DIRECTORS’ REPORT ISSUE OF SHARES AND DEBENTURES During the financial period.000 20. (b) A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg27 .2.11.000.2006 7. or which would render the values attributed to current assets in the financial statements of the Group and of the Company misleading.50 0.715 513. the following shares were issued:Date of issue Class of shares Par value RM 0.2006 15.11.751.735.000 Subscribers’ share Acquisition of subsidiary companies Acquisition of subsidiary company Acquisition of subsidiary company Rights issue Public issue There were no debentures issued during the financial period. the Directors are not aware of any circumstances:(a) which would render it necessary to write off any bad debts or the amount of allowance for doubtful debts in the financial statements of the Group and of the Company inadequate to any substantial extent.2006 18. At the date of this report. there does not exist:(a) any charge on the assets of the Group and of the Company which has arisen since the end of the financial period which secures the liability of any other person. (b) (c) 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 period which. INFORMATION ON THE FINANCIAL STATEMENTS Before the financial statements of the Group and of the Company were made out. in the opinion of the Directors.50 0. the Directors took reasonable steps:(a) to ascertain that action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts and satisfied themselves that no bad debts to be written off and adequate allowance had been made for doubtful debts.2007 Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary 2 119. or any contingent liability of the Group and of the Company which has arisen since the end of the financial period.047 4.50 0.11.236 5.2006 8. or which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate. and to ensure that any current assets which were unlikely to be realised in the ordinary course of business including their values as shown in the accounting records of the Group and of the Company have been written down to an amount which they might be expected so to realise.50 0.50 Number of shares Purpose of issue 15.

2006) Loh Wei Tak (appointed as Independent Non-Executive Director on 30. In the opinion of the Directors:(a) the results of operations of the Group and of the Company during the financial period were not substantially affected by any item.2006) Saw Siew Ee (appointed as Independent Non-Executive Director on 30.2006) Tan Sui Hin (appointed as Independent Non-Executive Director on 30.564.2006) To Tai Wai (appointed as Executive Director on 11.11. the beneficial interests of those who were Directors at the end of the financial period in the shares of the Company are as follows:Ordinary shares of RM0.301 7.11. SIGNIFICANT EVENT SUBSEQUENT TO THE BALANCE SHEET DATE Significant event subsequent to the balance sheet date is disclosed in Note 32 to the Financial Statements. transaction or event of a material and unusual nature except for the effects arising from the adoption of new and revised Financial Reporting Standards (“FRS”) as disclosed in Note 3(b) to the Financial Statements.070. DIRECTORS OF THE COMPANY The Directors in office since the date of incorporation are:Chew Ting Leng (appointed as Executive Chairman on 13.11. (b) SIGNIFICANT EVENTS DURING THE FINANCIAL PERIOD Significant events during the financial period are disclosed in Note 31 to the Financial Statements.2.11.2006) According to the Register of Directors’ Shareholdings.50 each As at 15.2006) Liang Siew Ching (First Director and resigned on 12.494.deemed interest Bought Sold As at 28.11.11.2006) Abdul Karim Bin Ahmad (appointed as Non Independent Non-Executive Director on 30.11.DIRECTORS’ REPORT OTHER STATUTORY INFORMATION The Directors state that:At the date of this report.2006) Yusanida Bte Mohd Nor (First Director and resigned on 12.101 36.11.5.11.2006 Chew Ting Leng . they are not aware of any circumstances not otherwise dealt with in this report or the financial statements which would render any amount stated in the financial statements misleading.11. transaction or event of a material and unusual nature likely to affect substantially the results of operations of the Group and of the Company for the current financial period in which this report is made.2006) Goh Teoh Kean (appointed as Group Deputy Managing Director on 11.2007 - 43. and there has not arisen in the interval between the end of the financial period and the date of this report any item.200 Pg28 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .11.2006/Group Managing Director on 11.2006) Tan Ang Ang (appointed as Executive Director on 11.

315.691. DIRECTORS’ BENEFITS During and at the end of the financial period.400 - 5.000 - 30. Since the date of its incorporation.5.direct interest Abdul Karim Bin Ahmad .direct interest Saw Siew Ee .000 - 30. or with a company in which he has a substantial financial interest.deemed interest To Tai Wai .026.50 each As at 15.026. Chew Ting Leng.953 4.direct interest Tan Ang Ang .000 By virtue of Mr.000 - 30.200 - 4.2. 1965.586. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg29 . Goh Teoh Kean. no arrangements subsisted to which the Company is a party.2007 - 30. Mr.000 - 30. Tan Ang Ang’s direct and indirect interest in the Company.direct interest Bought Sold As at 28. they are also deemed to have interest in the shares of all the subsidiary companies to the extent that the Company has an interest under Section 6A of the Companies Act. To Tai Wai and Mr.200 - 30. no Director has received or become entitled to receive any benefit (other than as disclosed in the Notes 24 and 28 to the Financial Statements) by reason of a contract made by the Company or a related corporation with the Director or with a firm of which he is a member.096 25.direct interest Loh Wei Tak .496 4. with the object or objects of enabling the Directors of the Company to acquire any benefits by means of the acquisition of shares in the Company or any other body corporate.222.100 - 4.DIRECTORS’ REPORT DIRECTORS OF THE COMPANY (CONT’D) Ordinary shares of RM0.direct interest Tan Sui Hin .000 - 30.907.053 894.000 - 30.000 - 30.2006 Goh Teoh Kean . Mr.

........ Signed on behalf of the Board of Directors in accordance with a resolution of the Directors dated 25 May 2007............ GOH TEOH KEAN ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) DIRECTORS Johor Bahru 25 May 2007 Pg30 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .................... CHEW TING LENG ............................................. ......DIRECTORS’ REPORT AUDITORS Messrs Shamsir Jasani Grant Thornton have expressed their willingness to continue in office...............

................................S Commissioner for Oaths Johor Bahru A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg31 .......... On behalf of the Board ................ 1965 and applicable MASB Approved Accounting Standards in Malaysia for Entities Other Than Private Entities so as to give a true and fair view of the state of affairs of the Group and of the Company as at 28 February 2007.STATEMENT BY DIRECTORS/ STATUTORY DECLARATION STATEMENT BY DIRECTORS In the opinion of the Directors........................... CHEW TING LENG …....... WANG WOON CHIN Before me: Rusly B........ 1960.............. do solemnly and sincerely declare that to the best of my knowledge and belief............... Wang Woon Chin. being the Officer primarily responsible for the financial management of Pantech Group Holdings Berhad.... the financial statements set out on pages 34 to 72 are drawn up in accordance with the provisions of the Companies Act...... GOH TEOH KEAN Johor Bahru 25 May 2007 STATUTORY DECLARATION I.......... the financial statements set out on pages 34 to 72 are 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.......I........ Subscribed and solemnly declared by the abovenamed at Johor Bahru in the State of Johor this day of 25 May 2007 ) ) ) ) .............. Mohd Yunus P............... results of operations and cash flows of the Group and of the Company for the financial period from 15 May 2006 (date of incorporation) to 28 February 2007.

We conducted our audit in accordance with applicable Approved Standards on Auditing in Malaysia. 1965 to be dealt with in the financial statements of the Group and of the Company. 1965 and applicable MASB Approved Accounting Standards in Malaysia for Entities Other Than Private Entities so as to give a true and fair view of:(i) the state of affairs of the Group and of the Company as at 28 February 2007 and of the results of operations and cash flows of the Group and of the Company for the financial period from 15 May 2006 (date of incorporation) to 28 February 2007. Pg32 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . We believe that our audit provides a reasonable basis for our opinion. evidence relevant to the amounts and disclosures in the financial statements. on a test basis. We do not assume responsibility towards any other person for the content of this report. which we consider necessary to provide us with sufficient evidence to give reasonable assurance that the financial statements are free of material misstatement. These financial statements are the responsibility of the Company’s Directors. in accordance with Section 174 of the Companies Act.REPORT OF THE AUDITORS TO THE MEMBERS OF PANTECH GROUP HOLDINGS BERHAD (Incorporated in Malaysia) We have audited the financial statements set out on pages 34 to 72 of Pantech Group Holdings Berhad. (ii) and b) the accounting and other records and the registers required by the Companies Act. 1965 to be kept by the Company and the subsidiary companies of which we have acted as auditors have been properly kept in accordance with the provisions of the said Act. These standards require that we plan and perform the audit to obtain all the information and explanations. An audit includes an assessment of the accounting principles used and significant estimates made by the Directors as well as evaluating the overall financial statements presentation. based on our audit. on these financial statements and to report our opinion to you. It is our responsibility to form an independent opinion. as a body. 1965 and for no other purpose. An audit includes examining. and the matters required by Section 169 of the Companies Act. In our opinion:a) the financial statements have been properly drawn up in accordance with the provisions of the Companies Act.

REPORT OF THE AUDITORS TO THE MEMBERS OF PANTECH GROUP HOLDINGS BERHAD (Incorporated in Malaysia) We have considered the financial statements and the auditors’ report of the subsidiary company of which we have not acted as auditors. The auditors’ reports on the financial statements of the subsidiary companies were not subject to any qualification and in respect of subsidiary companies incorporated in Malaysia. as disclosed in Note 11 to the Financial Statements. We are satisfied that the financial statements of the subsidiary companies that have been consolidated with the Company’s financial statements 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. AF : 0737) CHARTERED ACCOUNTANTS DATO’ N.K. SHAMSIR JASANI GRANT THORNTON (NO. JASANI CHARTERED ACCOUNTANT (NO: 708/03/08(J/PH)) PARTNER Johor Bahru 25 May 2007 A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg33 . did not include any comment (or any adverse comment) made under Section 174 (3) of the Act.

118 94.044 23.560 2.067.866 117.666 40.444 12.701.634.000. plant and equipment Investment properties Investment in subsidiary companies Investment in an associate company Investment in a joint venture company Other investments Deferred tax assets Total non-current assets CURRENT ASSETS Inventories Trade receivables Other receivables Amount due from subsidiary companies Amount due from an associate company Tax recoverable Fixed deposits with licensed banks Cash and bank balances Total current assets 9 10 11 12 13 14 15 26.435 72.175 197.140 Note SHARE CAPITAL SHARE PREMIUM EXCHANGE RESERVE UNAPPROPRIATED PROFIT Equity attributable to equity holders of the Company / Total equity NON-CURRENT LIABILITIES Finance creditors Borrowings Deferred taxation 5 6 7 8 2.000 16.271.470 2.900 901.529 94.2007 RM 75.022 13.903.435 16 17 18 11 12 19 98.022 3.923 2.887 Company 28.140 REPRESENTED BY:NON-CURRENT ASSETS Property.908.608 22.643.297.000.086.838.502.2007 RM 75.667.217.131.000 16.374 63.768 25.404 147.200 121.729.823.265.195 42.269 Pg34 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .000.026.006.031 13.000 7.460 130.067.2.271.217 3.784 59.915 72.535 9.636 229.815.2.997.999 26.701.736.757.BALANCE SHEETS AS AT 28 FEBRUARY 2007 Group 28.

644.730.2007 RM Company 28.701.529 290.236 22.536 2.637.477 1.2007 RM Note LESS: CURRENT LIABILITIES Trade payables Other payables Amount due to subsidiary companies Amount due to an associate company Amount due to a joint venture company Borrowings Bank overdrafts Tax payable Total current liabilities NET CURRENT ASSETS 20 21 11 12 13 7 22 13.379 1.614 147.705 94.652 73.548 2.813.808 92. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg35 .173.000 385.070 2.564 22.997.BALANCE SHEETS AS AT 28 FEBRUARY 2007 (CONT’D) Group 28.239.792 28.170 105.2.370.2.236 64.429.140 The accompanying notes form an integral part of the financial statements.

Pg36 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .Basic (sen) Proposed Dividends per 50 sen share .283.263) 30.gross (sen) .2.5.742) 4.60 - 3.667.370) (4.2007 RM 5.648 4.227 (67.2.118 Note Revenue Cost of sales Gross profit Other income Excess of net fair value over acquisition costs Selling and distribution expenses Administration expenses Other expenses Profit from operations Finance costs Share of profit in associate company Share of loss in joint venture company Profit before taxation Taxation Net profit for the financial period 23 Attributable to:Equity holders of the Company Earnings per share attributable to equity holders of the Company Earnings per 50 sen share .19 The accompanying notes form an integral part of the financial statements.917.530) 3.378 17.148.118 26 65.634.684) (3.361.983 (38.634.148.012 (2.836 (164.573) 13.839.866 Company 15.757.648 (1.829.992.039) 26.401.INCOME STATEMENTS FOR THE FINANCIAL PERIOD FROM 15 MAY 2006 (DATE OF INCORPORATION) TO 28 FEBRUARY 2007 Group 15.757.2006 to 28.186) 22.475.992.866 3.905 (1.517) 24 25 28.2006 to 28.554 5.00 2.554 8.584.910 (2.358.088.041 502.5.net (sen) 26.604.2007 RM 90.

STATEMENTS OF CHANGES IN EQUITY FOR THE FINANCIAL PERIOD FROM 15 MAY 2006 (DATE OF INCORPORATION) TO 28 FEBRUARY 2007 Attributable to equity holders of the Company Non-distributable Distributable Share Share Exchange Unappropriated capital premium reserve profit RM RM RM RM Group At date of incorporation Issuance of share capital pursuant to acquisition of subsidiary companies Issuance of share capital pursuant to Rights Issue Issuance of share capital pursuant to Public Issue Listing expenses Currency translation differences Net profit for the financial period Balance at 28 February 2007 1 1 Total equity RM 62.499.500.000 (2.866 26.067.826.500.000 - - 2.000 (2.701.326.866 117.999 - 13.000 16.000 - 13.999 4.634.687 - 67.687 - - 67.000.359.999 26.118 3.000.600.665) - - 13.600.326.000 13.866 26.022 13.000 (2.838.634.686 2.067.118 94.359.022 3.600.359.000 10.999 75.500.000 (2.000.500.140 The accompanying notes form an integral part of the financial statements.887 Share capital RM Company At date of incorporation Issuance of share capital pursuant to acquisition of subsidiary companies Issuance of share capital pursuant to Rights Issue Issuance of share capital pursuant to Public Issue Listing expenses Net profit for the financial period Balance at 28 February 2007 Non-distributable Distributable Share Unappropriated premium profit RM RM Total RM 1 - - 1 62.000 75.999 4.757. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg37 .000 - - - 2.634.600.000.118 23.499.686 2.000 10.665) 3.359.665) 16.757.826.757.665) - - 23.

2006 to 28.520) (8.959 17.715) (1. plant and equipment Investment in subsidiary companies Acquisition of subsidiary companies.749) (4.277.652 2.217) 290.666.2006 to 28.490 891.021 A B (468.CASH FLOW STATEMENTS FOR THE FINANCIAL PERIOD FROM 15 MAY 2006 (DATE OF INCORPORATION) TO 28 FEBRUARY 2007 Group 15.258 (59.908) 2.301 (17.257.732) (8.839) 3. plant and equipment Interest expenses Interest income Excess of net fair value over acquisition costs Share of loss in joint venture company Share of profit in associate company Dividend income Gain on disposal of property.2007 RM Company 15.361.517 (13.089 (4.033.794.944.021 (189.500.024 8.466) 38. plant and equipment Unrealised loss in foreign exchange Operating profit before working capital changes Inventories Receivables Payables Subsidiary companies Associate company Joint venture Bills payables Cash used in operations Dividend received Interest received Interest paid Tax paid Net cash (used in)/generated from operating activities CASH FLOW FROM INVESTING ACTIVITIES Purchase of property.688.877) (17.877 (2.792 (3.665 (5.944.992.910) 38.829.2. net of cash acquired Net cash generated from/(used in) investing activities 28.5.265 17.2007 RM Note CASH FLOWS FROM OPERATING ACTIVITIES Profit before taxation Adjustments for:Allowance for doubtful debts Allowance for slow moving inventories Depreciation of property.236 (3.506.991) (368. plant and equipment Proceeds from sale of property.521.554) 189.066) 220.595 16.033.784.749) Pg38 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .021) (747.836) (4.135) 3.648 242.836 231.644) 189.905 4.2.957 2.767.696 11.700.224.983) (1.026.109.134) (15.5.

336 31.2007 RM Company 15.290.359.440 79.665) (499.411 13.900 4.271.030 was acquired by means of hire purchase.233 19.5.526.026.2006 to 28.614.538 A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg39 .628.647.2006 to 28.2.608 19.006.698) 51.740.026.101 (290. plant and equipment Investment properties Other investments Investment in subsidiary companies Investment in associate company Investment in joint venture company Deferred tax assets Inventories Trade and other receivables Less: Allowance for doubtful debts Amount due from subsidiary companies Amount due from related companies 26.086. ACQUISITION OF SUBSIDIARY COMPANIES The fair value of assets acquired and liabilities assumed of the subsidiary companies acquired during the financial period were as follows:Group 15.001 (2.403 3. plant and equipment.2007 RM Note CASH FLOW FROM FINANCING ACTIVITIES Proceeds from issuance of share capital Payment of listing expenses Repayment of hire purchase and finance lease creditors Repayment of borrowings Net cash generated from financing activities CASH AND CASH EQUIVALENTS Net change Effect of exchange rate changes Carried forward NOTES TO THE CASH FLOW STATEMENTS C 26.001 (2.730 51.612 134.000 83.999 31.2. PLANT AND EQUIPMENT The Group acquired property.932.100.666 2.165 of which RM822.359.608 A.2.135 were made to purchase the property.5.5. Cash payments of RM468.665 26.CASH FLOW STATEMENTS FOR THE FINANCIAL PERIOD FROM 15 MAY 2006 (DATE OF INCORPORATION) TO 28 FEBRUARY 2007 (CONT’D) Group 15. plant and equipment with an aggregate cost of RM1.217 160. PURCHASE OF PROPERTY.2007 RM Property.460) 22.665) 23.211) (593.641.2006 to 28.642 26.100.061.760. B.234 13.

2.663.628. CASH AND CASH EQUIVALENTS Cash and cash equivalents included in the cash flow statements comprise the following balance sheet amounts:Group Company 15.2007 RM RM Cash and bank balances Fixed deposits with licensed banks Bank overdrafts 9.990 (16.535 (1.131.265 C.490.435 67.018.2007 RM Amount due from joint venture company Fixed deposits with licensed banks Cash and bank balances Trade and other payables Amount due to holding company Amount due to associate company Bank overdrafts Finance creditors Term loans Borrowings Tax payable Deferred taxation Net assets acquired Less: Excees of net fair value over acquisition costs Cost of investments Less: Non-cash purchase consideration Company’s cash outflows on acquisition paid to subsidiary companies Cash and cash equivalents acquired .829.2006 to to 28.026.233 7.5.Cash and bank balances .475) 16.944.688.954.5.139) (759.750 1.345 (17.490.035) (8.239.2007 28.271.608 12.990 (3.608 The accompanying notes form an integral part of the financial statements.749) 17.000.2006 15.200) 90.893) (3. Pg40 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .326.5.2.278) (998.301.000 19.910) 72.159.477) 31.Bank overdrafts Group’s cash inflows on acqusition.018.505) (79.750 1.475) (2.175 23.686 (4.2.159.Fixed deposits with licensed banks .736. net of cash and cash equivalents acquired 20.381. ACQUISITION OF SUBSIDIARY COMPANIES (CONT’D) Group 15.026.231) (141.242) (3.2006 to 28.159.CASH FLOW STATEMENTS FOR THE FINANCIAL PERIOD FROM 15 MAY 2006 (DATE OF INCORPORATION) TO 28 FEBRUARY 2007 (CONT’D) B.044 20.101.

Ringgit Malaysia (RM). Equity interests classified as current assets are available for sale and the Group manages disposal of its interests to optimise returns on realisation. is represented by the carrying amount of the trade and other receivables as shown in the balance sheet. credit limits and monitoring procedures. based on estimates of future needs. (e) Liquidity and cash flow risks The Group maintains a prudent liquidity risk management policy by maintaining adequate cash. (c) Credit risk The Group is exposed to credit risk mainly from trade and other receivables. (d) Market risk The Group’s principal exposures to market risk arises mainly from the changes in equity prices. The Group is not exposed to significant concentration of credit risk. FINANCIAL RISK MANAGEMENT POLICIES The Group’s financial risk management policy seeks to ensure that adequate financial resources are available for the development of the Group’s businesses whilst managing its risks. establishes credit lines with licensed financial institutions in Malaysia. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg41 . The risk is managed through the application of credit approvals. without taking into account the fair value of collaterals. The Group’s policy is to minimise the exposure of overseas operating activities to transaction risk by matching local currency income against local currency costs. Credit is extended to the customers based upon careful evaluation of the customers’ financial condition and credit history. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS The financial statements of the Group and of the Company have been prepared in accordance with the provisions of the Companies Act. 1965 and applicable MASB Approved Accounting Standards in Malaysia for Entities Other Than Private Entities.NOTES TO THE FINANCIAL STATEMENTS . The main areas of financial risks faced by the Group and the policy in respect of the major areas of treasury activity are set out as follows:(a) Foreign currency risk The Group is exposed to foreign currency risk as a result of its normal operating activities. (b) Interest rate risk The Group’s exposure to changes in interest rates relates primarily to the Group’s short term deposits with licensed financial institution and financing through bank borrowings. 2. where the currency denomination differs from the local currency. The Group operates within policies that are approved by the Board and the Group’s policy is not to engage in speculative transactions. both external and intra-Group. The Group also periodically evaluates its cash flow requirements and where deemed necessary. The Group ensures that it obtains borrowings at competitive interest rates under the most favourable terms and conditions.28 FEBRUARY 2007 1. Surplus funds are placed with licensed financial institutions to minimise the risk that the counterparties will fail in performing their obligation. The Group does not use derivate financial instruments to hedge its risks. The maximum credit risk exposure of the Group.

SIGNIFICANT ACCOUNTING POLICIES (a) Accounting convention The financial statements of the Group and of the Company are prepared under the historical cost convention.NOTES TO THE FINANCIAL STATEMENTS . 1122004. 110. 116. The functional currency of the Company is Ringgit Malaysia (RM). 1182004.28 FEBRUARY 2007 3. Pg42 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . 1342004. 127. and 1372004 do not have significant financial impact on the Group and the Company. 128. 1142004. Plant and Equipment Revenue Employee Benefits The Effect of Changes in Foreign Exchange Rates Borrowing Costs Consolidated and Separate Financial Statements Investment in Associates Interests in Joint Ventures Financial Instruments : Disclosure and Presentation Earning Per Share Interim Financial Reporting Impairment of Assets Provisions. after reassessment. Contingent Liabilities and Contingent Assets Intangible Assets Investment Property The adoption of FRS 102. 131. any excess of the Group’s interest in the net fair value of acquirees’ identifiable assets. liabilities and contingent liabilities over cost of acquisitions (previously referred to as “negative goodwill”). 1192004. 1232004. The principal effects in accounting policies resulting from the adoption of the other FRSs are as follows:FRS 3: Business Combinations and FRS 138: Intangible Assets Under FRS 3. 133. Changes in Accounting Estimates and Errors Events After the Balance Sheet Date Income Taxes Segment reporting Property. 1072004. unless otherwise indicated in the other significant accounting policies. is recognised immediately as income. 108. 132. (b) Adoption of Financial Reporting Standards (“FRS”) The following applicable FRSs have been adopted by the Group and the Company effective for financial period beginning on or after 15 May 2006:FRS 3 FRS 101 FRS 102 FRS 1072004 FRS 108 FRS 110 FRS 1122004 FRS 1142004 FRS 116 FRS 1182004 FRS 1192004 FRS 121 FRS 1232004 FRS 127 FRS 128 FRS 131 FRS 132 FRS 133 FRS 1342004 FRS 136 FRS 1372004 FRS 138 FRS 140 Business Combinations Presentation of Financial Statements Inventories Cash Flow Statements Accounting Policies.

FRS 140: Investment Property The adoption of this new FRS has resulted in a change in accounting policy for investment properties. minority interests are now presented within total equity. FRS 101 also requires disclosure. investment properties were stated at valuation. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (b) Adoption of Financial Reporting Standards (“FRS”) (Cont’d) FRS 101: Presentation of Financial Statements The adoption of the revised FRS 101 has affected the presentation of minority interest. The consolidated financial statements are presented in Ringgit Malaysia. Investment properties are now stated at fair value.28 FEBRUARY 2007 3. which is the Company’s functional and presentation currency. In addition. This change in accounting policy has been accounted for retrospectively. Previously. In accordance with the transitional provisions of FRS 140. Gains or losses arising from changes in the fair values of investment properties are recognised in profit or loss in the period in which they arise. In the consolidated income statement. exchange differences arising on a monetary item that forms part of a reporting entity’s net investment in a foreign operation. A similar requirement is also applicable to the statement of changes in equity. where that monetary item is denominated in a currency other than the functional currency of either the reporting entity or the foreign operation. showing separately the amounts attributable to equity holders of the parent and to minority interest. Under the revised FRS 121. as of 1 January 2006. The current period’s presentation of the Group’s financial statements is based on the revised requirements of FRS 101. any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition are now treated as assets and liabilities of the foreign operation and translated at the closing rate. are to be recognised in profit or loss in the consolidated financial statements. total recognised income and expenses for the period. In the consolidated balance sheet. Prior to 1 January 2006. The investment properties were last revalued in February 2006. minority interests are presented as an allocation of the total profit or loss for the period. Revaluations were carried out at least once every five years and any revaluation increase is taken to equity as a revaluation surplus. this change in accounting policy is applied prospectively. representing open-market value determined by external valuers. such exchange differences were taken to equity. this change is applied prospectively. Goodwill acquired in business combinations prior to 1 January 2006 and fair value adjustments arising on those acquisitions are deemed to be assets and liabilities of the parent company and were translated using the exchange rate at the dates of acquisitions. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg43 . FRS 121: The Effects of Changes in Foreign Exchange Rates Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). In accordance with the transitional provisions of FRS 121.NOTES TO THE FINANCIAL STATEMENTS . on the face of the statement of changes in equity. share of net after-tax results of associates and other disclosures.

NOTES TO THE FINANCIAL STATEMENTS . They are assessed on an on-going basis and are based on experience and relevant factors. that have significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below:Income taxes The Group is exposed to income taxes in numerous jurisdictions. The Group recognised tax liabilities based on estimates of whether additional taxes will be due. (c) Significant Accounting Estimates and Judgements Estimates. Pg44 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . Where the final tax outcome of these matters is different from the amounts that were initially recognised.Exploration for and Evaluation of Mineral Resources FRS6 is not relevant to the Group’s and Company’s operations. There are certain transactions and computations for which the ultimate tax determination is uncertain during the ordinary course of business. (b) Amendment to FRS1192004: Employee Benefits – Actuarial Gains and Losses. income and expenses. (iii) Deferred FRS 139 . (i) Key sources of estimation uncertainty The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date.Leases FRS124 . They affect the application of the Group’s accounting policies and reported amounts of assets. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (b) Adoption of Financial Reporting Standards (“FRS”) (Cont’d) FRS 140: Investment Property (Cont’d) The Group and the Company have not adopted the following:(i) FRSs that are mandatory for financial periods beginning on or after 1 October 2006:(a) (b) (ii) FRS117 . liabilities.Related Party Disclosures FRSs and amendment that are mandatory for financial periods beginning on or after 1 January 2007:(a) FRS6 . Significant judgement is involved in determining the Group-wide provision for income taxes. Group Plans and Disclosures Amendment to FRS1192004 is not relevant to the Group’s and Company’s operations. such difference will impact the income tax and deferred tax provisions in the period in which such determination is made.28 FEBRUARY 2007 3.Financial Instruments: Recognition and Measurement The Malaysian Accounting Standards Board has yet to announce the effective date of this standard. including expectations of future events that are believed to be reasonable under the circumstances. assumptions concerning the future and judgements are made in the preparation of the financial statements. and disclosures made.

All intercompany transactions. Some properties comprise a portion that is held to earn rentals or for capital appreciation and another portion that is held for use in the production or supply of goods or services or for administrative purposes. (ii) Critical judgement made in applying accounting policies The following is the judgement made by management in the process of applying the Group’s accounting policies that have the most significant effect on the amounts recognised in the financial statements. Deferred tax assets Deferred tax assets are recognised for all unutilised tax losses and unabsorbed capital allowances to the extent that it is probable that taxable profit will be available against which the losses and capital allowances can be utilised. and has developed criteria in making that judgement. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (c) Significant Accounting Estimates and Judgements (Cont’d) (i) Key sources of estimation uncertainty (Cont’d) Depreciation of property. Judgement is made on an individual property basis to determine whether ancillary services are so significant that a property does not qualify as an investment property. the Group considers whether a property generates cash flows largely independently of the other assets held by the Group. Significant management judgement is required to determine the amount of deferred tax assets that can be recognised. the Group accounts for the portions separately. Investment property is a property held to earn rentals or for capital appreciation or both. balances and unrealised gains on transactions between group companies are eliminated. based upon the likely timing and level of future taxable profits together with future tax planning strategies. Changes in the expected level of usage and technological developments could impact the economic useful life and the residual values of these assets. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg45 .28 FEBRUARY 2007 3. the property is an investment property only if an insignificant portion is held for use in the production or supply of goods or services or for administrative purposes. therefore future depreciation charges could be revised. unrealised losses are also eliminated on consolidation unless cost cannot be recovered. Classification between investment properties and owner-occupied properties The Group determines whether a property qualifies as an investment property. Therefore. plant and equipment are depreciated on a straight-line basis over their useful life. (d) Basis of consolidation The Group financial statements consolidate the audited financial statements of the Company and all of its subsidiary companies. If the portions could not be sold separately. plant and equipment Property. which have been prepared in accordance with the Group’s accounting policies. Management estimated the useful life of these assets to be within 4 to 40 years except for the freehold land which is not depreciated.NOTES TO THE FINANCIAL STATEMENTS . If these portions could be sold separately (or leased out separately under a finance lease).

Acquisition of subsidiary companies is accounted for using the purchase method. equity instruments issued and liabilities incurred or assumed at the date of exchange. The cost of an acquisition is measured as the fair value of the assets given. irrespective of the extent of any minority interest. plant and equipment Property. Any revaluation increase is credited to equity as a revaluation surplus. the increase is recognised in the income statement to the extent of the decrease previously recognised.28 FEBRUARY 2007 3. Subsidiary companies are consolidated using the acquisition method of accounting from the date on which control is transferred to the Group and are no longer consolidated from the date that control ceases. plant and equipment are initially stated at cost. Upon the disposal of revalued assets. plant and equipment are stated at historical cost less accumulated depreciation and any impairment losses. Depreciation is provided on the straight line method in order to write off the cost of each asset over its estimated useful life. Pg46 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . in which case. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (d) Basis of consolidation (Cont’d) The financial statements of the Company and its subsidiary companies are all drawn up to the same reporting date. A revaluation decrease is first offset against an increase on unutilised valuation surplus in respect of the same asset and is thereafter recognised as an expense. except to the extent that it reverses a revaluation decrease for the same asset previously recognised as an expense. the attributable revaluation surplus remaining in the revaluation reserve is transferred to unappropriated profits. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Land and buildings are subsequently shown at market value. plus costs directly attributable to the acquisition.NOTES TO THE FINANCIAL STATEMENTS . based on valuations by external valuers. (e) Property. The gain or loss on disposal of a subsidiary company is the difference between net disposal proceeds and the Group’s share of its net assets together with any unamortised or unimpaired balance of goodwill on acquisition and exchange differences. All other property. Any excess of the Group’s interest in the net fair value of the identifiable assets. No depreciation is provided on freehold land. Revaluation is made at least once in every five years based on valuation by an independent valuer on an open market value basis. less subsequent depreciation and any impairment losses. liabilities and contingent liabilities over the cost of business combination is recognised as income on the date of acquisition.

10% 10% .5% 10% .5. plant and equipment (Cont’d) The principal annual depreciation rates used are as follows:Leasehold land Factory buildings Renovation. plant and equipment.NOTES TO THE FINANCIAL STATEMENTS .20% 20% Restoration cost relating to an item of property. Any gain or loss arising on derecognition of the asset is included in the income statement in the financial year in which the asset is derecognised.20% 20% 7% . plant and equipment i. An item of property.e. in the opinion of the Directors. Recoverable amount is the net selling price of the property. plant and equipment beyond its previously assessed standard of performance.25% 10% . the amount obtainable from the sale of an asset in an arm’s length transaction between knowledgeable. plant and equipment are written down to recoverable amount if. Investment in subsidiary companies is stated at cost. furniture and fittings Telecommunication system. Where an indication of impairment exists. the carrying amount of the subsidiary companies is assessed and written down immediately to their recoverable amount. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (e) Property. less the costs of disposal.28 FEBRUARY 2007 3. willing parties. plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg47 . 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. forklift and motor vehicles Over the leasehold period of 40 years 4% . The residual values. Property. (f) Subsidiary companies A subsidiary company is a company in which the Company or the Group either directly or indirectly owns a power to govern its financial and operating policies so as to obtain benefits from its activities. plant and equipment is capitalised only if such expenditure is expected to increase the future benefits from the existing property. warehouse extension and electrical installation Computers and software Plant and machinery Factory equipment Office equipments. it is less than their carrying value.

in the opinion of the Directors. (j) Investment properties Investment properties consist of land and buildings held for capital appreciation or rental purpose and not occupied or only an insignificant portion is occupied for use or in the operations of the Group. Investment properties are treated as long-term investments and are measured initially at cost.28 FEBRUARY 2007 3. the difference between net disposal proceeds and its carrying amount is charged or credited to the income statement. The carrying amount includes the cost of replacing part of an existing investment property at the time that cost is incurred if the recognition criteria are met and excludes the costs of day-to-day servicing of an investment property.NOTES TO THE FINANCIAL STATEMENTS . Pg48 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . including transaction costs. (h) Joint venture The Group’s joint venture is an entity over which the Group has contractual arrangements to jointly share the control over the economic activity of the entity with one or more parties. there is an impairment in value. Allowance is made for any impairment losses on an individual joint venture basis. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (g) Associate company An associate company is a company in which the Company or the Group is in the position to exercise significant influence over its financial and operating policies through management participation but not to exert control over those policies. investment properties are stated at fair value. Where an indication of impairment exists. On disposal of an investment. the carrying amount of the associate company is assessed and written down immediately to their recoverable amount. Interest in joint venture is accounted for using the equity method in the balance sheet of the Group. Equity accounting is discontinued when the carrying amount of the investment in an associate company reaches zero. associate company and joint venture are shown at cost and allowance is only made where. Investment in joint venture is stated at cost. which reflects market conditions at the balance sheet date. Investment in an associate company is stated at cost. Investment in an associate company is accounted for in the consolidated financial statements using equity accounting which involves recognising in the income statement the Group’s share of the results of associate company based on audited financial statements of the associate company. Subsequent to initial recognition. unless the Group has incurred obligations or guaranteed obligations in respect of the associate company. The Group’s investment in an associate company is carried in the balance sheet at an amount that reflects its share of the net assets of the associate company. Impairment in the value of an investment is recognised as an expense in the period in which the impairment is identified. (i) Other investments Non-current investments other than investment in subsidiary companies. Gain or losses arising from changes in the fair values of investment properties are included in the income statement in the financial year in which they arise.

An estimate is made for doubtful debts based on a review of all outstanding amounts at the financial year end. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg49 . (n) Assets acquired under hire purchase and finance lease arrangements The cost of property. Inventories are determined on a first-in-first-out basis. Finance charges on hire purchase and finance lease arrangements are allocated to income statement over the period of the respective agreements. plant and equipment acquired under hire purchase and finance lease arrangements which transfer substantially all the risks and rewards of ownership to the Group are capitalised.28 FEBRUARY 2007 3. Cost of work-in-progress and finished goods include raw materials.NOTES TO THE FINANCIAL STATEMENTS . plant and equipment depreciation policy. obsolete and slow moving inventories. Bad debts are written off in the period in which they are identified. (l) Receivables Receivables are carried at anticipated realisable value. Net realisable value represents the estimated selling price in the ordinary course of business less selling and distribution costs and all other estimated costs to completion. Outstanding obligation due under hire purchase and finance lease arrangements after deducting finance expenses are included as liabilities in the financial statements. (m) Payables Payables are stated at cost which is fair value of the consideration to be paid in the future for goods and services received. direct labour and an appropriate proportion of manufacturing overheads. (k) Inventories Inventories are stated at the lower of cost and net realisable value after adequate allowance has been made for deteriorated. Cost of raw material refers to invoiced cost of goods purchased plus incidental handling and freight charges. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (j) Investment properties (Cont’d) Investment properties are derecognised when either they are disposed of or when they are permanently withdrawn from use and no future economic benefit is expected from the disposal. The depreciation policy on these assets is similar to that of the Group’s property. Cost of trading goods is determined on weighted average method. Any gain or loss on the retirement or disposal of an investment property is recognised in the income statement in the financial year of retirement or disposal.

or when it arises from a business combination that is an acquisition. On disposal of a foreign entity. including goodwill and fair value adjustments arising on the acquisitions. The assets and liabilities of the foreign entities. All other foreign exchange differences are taken to the income statement in the financial period in which they arise. the carrying amount of the deferred tax asset will be reduced accordingly. Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled. such reductions will be reversed to the extent of the taxable profit. whether realised or unrealised. Gains and losses from conversion of short term assets and liabilities. All resulting translation differences are included in the foreign exchange reserve in shareholders’ equity. If it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred tax asset to be utilised. the deferred tax is included in the resulting goodwill.NOTES TO THE FINANCIAL STATEMENTS . are translated to Ringgit Malaysia at the closing rates. except when it arises from a transaction which is recognised directly in equity. in which case the deferred tax is also charged or credited directly in equity. in which case. A deferred tax asset is recognised only to the extent that it is probable that taxable profit will be available against which the deductible temporary differences can be utilised. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (o) Foreign currency transactions and balances Transactions in foreign currencies are recorded in Ringgit Malaysia at rates of exchange ruling at the date of the transactions. Deferred tax is recognised in the income statement. Financial statements of foreign consolidated subsidiary companies are translated at period-end exchange rates with respect to the assets and liabilities. based on tax rates that have been enacted or substantively enacted by the balance sheet date. When it becomes probable that sufficient taxable profit will be available. The operating results are translated to Ringgit Malaysia at the average exchange rates during the financial period. Pg50 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . (p) Deferred tax liabilities and assets Deferred tax liabilities and assets are provided for under the liability method at the current tax rate in respect of all temporary differences at the balance sheet date between the carrying amount of an asset or liability in the balance sheet and its tax base including unused tax losses and capital allowances. the cumulative amount of exchange differences deferred in equity relating to that foreign entity is recognised in the income statement as a component of the gain or loss on disposal. Foreign currency monetary assets and liabilities are translated at exchange rates ruling at balance sheet date.28 FEBRUARY 2007 3. are included in the income statement as they arise. The carrying amount of a deferred tax asset is reviewed at each balance sheet date.

Financial instruments are offset when the Group has a legally enforceable right to set off the recognised amounts and intends either to settle on a net basis. in which case. net of depreciation. investments. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (q) Financial instruments Financial instruments carried on the balance sheet include cash and bank balances. the recoverable amount is estimated. An assessment is made at each balance sheet date as to whether there is any indication that previously recognised impairment losses for an asset other than goodwill may no longer exist or may have decreased. the Group reviews the carrying amounts of its assets to determine whether there is any indication of impairment. the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. After such a reversal. had no impairment loss been recognised for the asset in prior years. An impairment loss recognised for goodwill shall not be reversed in the subsequent period. unless the asset is carried at a revalued amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extent of any unutilised previously recognised revaluation surplus for the same asset.NOTES TO THE FINANCIAL STATEMENTS . If any such indication exists. or when annual impairment testing for an asset is required. or to realise the asset and settle the liability simultaneously. An impairment loss is recognised as an expense in the income statement immediately. Impairment losses of continuing operations are recognised in the income statement in those expense categories consistent with the function of the impaired asset. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg51 . less any residual value. the recoverable amount is estimated and an impairment loss is recognised whenever the recoverable amount of the asset or a cash-generating unit is less than its carrying amount. receivables. If such indication exists. (r) Impairment of assets At each balance sheet date. the reversal in excess of impairment loss previously recognised through the income statement is treated as revaluation increase. the depreciation charge is adjusted in future periods to allocate the asset’s revised carrying amount. payables and borrowings. All reversals of impairment losses are recognised as income immediately in the income statement unless the asset is carried at revalued amount. Recoverable amount of an asset or a cash-generating unit is the higher of fair value less costs to sell and its value in use. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the asset’s recoverable amount. In assessing value in use. That increased amount cannot exceed the carrying amount that would have been determined. on a systematic basis over its remaining useful life.28 FEBRUARY 2007 3. The particular recognition methods adopted are disclosed in the individual accounting policy statements associated with each item.

in which the associated services are rendered by employees of the Group. Short term accumulating compensated absences such as paid annual leave are recognised when services are rendered by employees that increase their entitlement to future compensated absences. All borrowing costs are recognised as expenses in the income statement in the period in which they are incurred.28 FEBRUARY 2007 3. Interest income is accounted for on accrual basis. As required by law. (v) Dividends Dividends on ordinary shares are accounted for in shareholders’ equity as an appropriation of unappropriated profits in the period in which they are declared. Sales and inter-company transactions between companies of the Group are excluded from revenue of the Group. companies in Malaysia make such contributions to the Employee Provident Fund (“EPF”). Such contributions are recognised as an expense in the income statement as incurred. net of discount and return. Pg52 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (s) Revenue recognition Revenue from sale of goods is recognised when the goods are delivered. and short term non-accumulating compensated absences such as sick leave are recognised when the absences occur.NOTES TO THE FINANCIAL STATEMENTS . net of transaction costs. Rental income is recognised when the rent is due. Some of the Group’s foreign subsidiaries also make contributions to their respective countries’ statutory pension schemes. (t) Employee benefits (i) Short term benefits Wages. (ii) Defined contribution plan Defined contribution plans are post-employment benefit plans under which the Group pays fixed contributions into separate entities or funds and will have no legal or constructive obligation to pay further contribution if any of the funds do not hold sufficient assets to pay all employee benefits relating to employee services in the current and preceding financial years. (u) Interest-bearing borrowings Interest-bearing borrowings are recorded at the amount of proceeds received. bonuses and social security contributions are recognised as an expense in the financial year. salaries.

expenses and result include transfers between segments. PRINCIPAL ACTIVITIES AND GENERAL INFORMATION The Company is principally engaged in investment holding and provision of management services. Faber Imperial Court. (z) Inter-segment transfers Segment revenues. 12 and 13 to the Financial Statements respectively. the amount of a provision is the present value of the expenditure expected to be required to settle the obligation. For the purpose of the balance sheet. 81700 Pasir Gudang. The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the Directors on 25 May 2007.NOTES TO THE FINANCIAL STATEMENTS . 50250 Kuala Lumpur. Provisions are reviewed at each balance sheet date and adjusted to reflect the current best estimate. The Company is a limited liability company. Pasir Gudang Industrial Estate. plant and equipment. legal or constructive. Segment assets and liabilities do not include tax recoverable and deferred income taxes.28 FEBRUARY 2007 3. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg53 . Johor Darul Takzim. The prices charged on inter-segment transactions are based on negotiation basis. when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. (y) Segmental results Segment revenues and expenses are those directly attributable to the segments and include any joint revenue and expenses where a reasonable basis of allocation exists. net of allowances and accumulated depreciation and amortisation. 4. SIGNIFICANT ACCOUNTING POLICIES (CONT’D) (w) Provisions Provisions are recognised when there is a present obligation. receivables. as a result of a past event. Segment assets include all assets used by a segment and consist principally of cash. bank balances. short term demand deposits and highly liquid investments which are readily convertible to known amount of cash and which are subject to an insignificant risk of changes in value. Jalan Tembaga Satu. Where the effect of the time of money is material. The registered office of the Company is located at Level 15-2. The principal activities of the subsidiary companies. incorporated and domiciled in Malaysia. The majority of the segment assets can be directly attributed to the segments on a reasonable basis. cash and cash equivalents are restricted to be used to settle a liability of 12 months or more after the balance sheet date is classified as non-current asset. Jalan Sultan Ismail. intangible assets and property. inventories. (x) Cash and cash equivalents Cash and cash equivalents comprise cash in hand. The principal place of business of the Company is located at PLO 234. associate company and joint venture are disclosed in Notes 11. These transfers are eliminated on consolidation.

276.000.185.000 1 62.2.467) 3.000 75.000 6.50 each At date of incorporation Issued during the financial period pursuant to .2007 RM Future minimum lease payment . SHARE CAPITAL Group and Company 28.321 (363.768 3.999 2. Pg54 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .after 1 year but not later than 5 years 979.000 10.public issue Carried forward 100.within 1 year . FINANCE CREDITORS Group 28.500.297.000.2.499.after 1 year but not later than 5 years 1.rights issue .28 FEBRUARY 2007 5.2007 RM Authorised:Ordinary shares of RM0.acquisition of subsidiary companies .854 Less: Interest in suspense Total present value payable .900.640.086 2.000.454.000 500.within 1 year .854 The amount payable within one year has been included in the other payables.419 2.50 each At date of incorporation Created during the financial period Carried forward Issued and fully paid:Ordinary shares of RM0.276.000 499.NOTES TO THE FINANCIAL STATEMENTS .902 3.

000.658.2. The trust receipts bear interest at rates ranging from 7. All term loans of the Group are repayable by monthly installments.407.267 Unsecured:Collaterised loan obligations 831. and Fixed deposits.443 72.539.75% per annum.013. Registered debentures covering fixed and floating charge on fixed and floating assets of a subsidiary company.550. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg55 .00% to 8.47% to 8.470 20.491 2.000 25.849 (i) The term loans.112 73.758 6.2007 RM Current Secured:Term loans Bankers acceptance Trust receipts Domestic resource factoring 1.643.00% per annum. BORROWINGS Group 28.15% to 1.379 Non-current Secured:Term loans Unsecured:Collaterised loan obligations 5.28 FEBRUARY 2007 7.370. Joint and several guarantee by certain Directors of the Company. A first legal charge on the machinery/equipment of a subsidiary company.75% per annum.575 61. bankers acceptance and trust receipts of the Group are secured against the following:(a) (b) (c) All landed properties of the Group. (d) (e) The term loans of the Group bear interest at rates ranging from 6.922. The bankers acceptance bears commission at rates ranging from 1.NOTES TO THE FINANCIAL STATEMENTS .470 99.643.

219. Collaterised Loan Obligations (“CLO”) is payable upon maturity on 20 September 2010.404 The balance in the deferred taxation is made up of temporary differences arising from:Group 28.25% per annum.2007 RM Additions through acquisition of subsidiary companies Transferred from income statement Carried forward 998.38% per annum of which the interest portion is payable twice per annum.2007 RM Tax effects of differences between carrying amount of qualifying property. plant and equipment and their tax base 2. It bears interest at the rate of 8.204 2.217.217. DEFERRED TAXATION Group 28. the Group is required to subscribe to a subordinated bond (Note 14).2.404 Pg56 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .200 1.28 FEBRUARY 2007 7. (iii) 8. As a condition to the granting of the above CLO. BORROWINGS (CONT’D) (ii) Domestic resource factoring is secured through joint and several guarantee by certain Directors of the Company.2.NOTES TO THE FINANCIAL STATEMENTS . It bears interest at the rate of 7.

956.604.693.433.334 1. plant and equipment of the Group is a motor vehicle registered under the name of a Director of a subsidiary company with the cost of RM394.873 5.28 FEBRUARY 2007 9.979 26.522.NOTES TO THE FINANCIAL STATEMENTS .666 46.000 - 4.804. All property.333 - 75.000 1.897 793.897. plant and equipment of the Group are fully depreciated property.000 2.796 (1. Included in the property.334 - 1.000.083 5.374 3. and equipments.171.914.400.771 6.2007 RM Additions through acquisition of subsidiary companies Additions Disposals Carried forward Accumulated depreciation Additions through acquisition of subsidiary companies Charge for the financial period Disposals Carried forward Net carrying amount 28.333 410.000 - 2.802) 340.400.126.290. Included in the property.600.165 (4.000.2.334.000 11.125 - 332. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg57 .644 1.556.418.352.031 All land and buildings of the Group are pledged to licensed banks as security for facilities granted to the Group.177 7. The net book value of property.718 3.2.471.334 3.880 - 10.268.179.750 33.402.334 5.767 2.223.500 - 96.853 - 32.185.398 487.666 - 46.334 5.898 - 891.953.500 - 11.433.802) - 96.751.667 34.593 3.114 - - - - - - 335. PLANT AND EQUIPMENT Group Total freehold land and building RM Short leasehold land RM Short leasehold building RM Total short leasehold land and building RM Renovation Machinery.233 - 96.695) 5.667 - 34.2007 5.667 769.895 10.500 11.432 (4.000 - 11.761 2.667.695) 5.224. plant and equipment with a total cost of RM1. electrical furniture and installation fittings RM RM Forklift and motor vehicles RM Cost Freehold land RM Freehold building RM Total 28.021. plant and equipment of a subsidiary company are pledged to a licensed bank by way of debentures for credit facility granted to that subsidiary company.333 2.398.388.334 - 5.600.565.135 6.500 96. plant and equipment of the Group which are acquired under hire purchase and finance lease arrangements amounted to RM3.500 11.790.000 - 1.015 8.433.652 (1.790.000 4. PROPERTY.223.316.834 1.

petrochemicals. INVESTMENT PROPERTIES Total freehold land & buildings RM Freehold land & shophouse building RM Group At fair value: Additions through acquisition of subsidiary companies Freehold land RM Freehold buildings RM Renovation RM Total 28. The investment properties are valued annually at fair value.086.28 FEBRUARY 2007 10.2007 RM 5. Malaysia Trading. flanges.666 280. The market value is defined as the estimated amount for which an asset or an interest in a property should exchange on the date of valuation between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had acted knowledgeably. Pg58 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 . Bhd.666 6. valves and other related products for use in the oil and gas.2. power generation.2007 % 100 72. prudently and without compulsion.2.At cost:Additions / Carried forward The particulars of the subsidiary companies are as follows:Effective equity interest 28.000 12.2007 RM Unquoted shares .956.840. by an independent professionally qualified valuer. 11. INVESTMENT IN SUBSIDIARY COMPANIES Company 28.435 Name of company Place of incorporation Principal activities 1.NOTES TO THE FINANCIAL STATEMENTS .666 All investment properties of the Group are pledged to licensed banks as security for banking facilities granted to the Group. supply and stocking of high pressure seamless and specialised steel pipes. gas reticulation. marine. fittings.000 13.2. palm oil refining and other related industries. comprising market value.796. onshore and offshore heavy engineering.000 10.271. Pantech Corporation Sdn.

Malaysia 100 Investment investment. Malaysia 100 3. tees. Bhd. valves and other related products for use in the oil and gas. Bhd. end-caps and high frequency induction long bends for use in the oil and gas and other related industries. onshore and offshore heavy engineering. actuators and controls for the oil and gas. fittings. Panaflo Controls Pte.2007 RM Unquoted shares .NOTES TO THE FINANCIAL STATEMENTS . Manufacturing and supply of buttwelded carbon steel fittings such as elbows.217 13. petrochemicals.2.* Singapore 100 * Subsidiary company not audited by Shamsir Jasani Grant Thornton The amounts due from/(to) subsidiary companies are unsecured. INVESTMENT IN SUBSIDIARY COMPANIES (CONT’D) Effective equity interest 28. marine. water treatment and other related industries and trading of specialised steel pipes and related products. Bhd. Pantech Steel Industries Sdn. Ltd. INVESTMENT IN AN ASSOCIATE COMPANY Group 28.At cost:Addition through acquisition of subsidiary company Share of post-acquisition profit 26.200 Represented by:Share of net assets 40.1 Jayee Holdings Sdn.2. gas reticulation. power generation. 2. petrochemicals.2 Pantech (Kuantan) Sdn.200 A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg59 .2007 % Name of company Place of incorporation Principal activities Subsidiary companies of Pantech Corporation Sdn. reducers.28 FEBRUARY 2007 11. Supplier of flow control solutions such as valves.983 40.: 1. holding and property Malaysia 100 Trading and supply of high pressure seamless and specialised steel pipes. 1. 12. palm oil refining and other related industries. Bhd. flanges. bear no interest and have no fixed term of repayment.

923 Name of company Place of incorporation Principal activities JC Flow Controls Pte. Malaysia Trading and supply of specialised industrial products. The amount due to a joint venture company is unsecured.2.2. Gate. Globe and Check valves for South East Asian markets.517) 121.2. * Singapore Sales and distribution of JC products such as Ball. Pg60 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .28 FEBRUARY 2007 12. bear no interest and no scheme of repayment has been arranged.923 Represented by:Share of net assets The particulars of the joint venture company are as follows:Effective equity interest 28.2007 % 70 121. The amounts due from/(to) an associate company are unsecured. Bhd. INVESTMENT IN AN ASSOCIATE COMPANY (CONT’D) The particulars of the associate company are as follows:Effective equity interest 28.NOTES TO THE FINANCIAL STATEMENTS . * Held through Panaflo Controls Pte. alloys and ferrous materials for the oil and gas and related industries. Ltd.2007 % 30 Name of company Place of incorporation Principal activities Tuah Nusa Sdn. 13. INVESTMENT IN A JOINT VENTURE COMPANY Group 28.2007 RM Addition through acquisition of subsidiary company Share of post-acquisition loss 160. Ltd. bears no interest and no scheme of repayment has been arranged.440 (38.

000 2.000) (822.28 FEBRUARY 2007 14.195) The balance in the deferred tax assets is made up of temporary differences arising from:Group 28.2007 RM Addition through acquisition of subsidiary company Transferred from income statement Carried forward (79.852) (901. OTHER INVESTMENTS Group 28.195) (901.2.000.2007 RM At cost:Quoted investment in Malaysia Subordinated bond (Note 7) 6.2.NOTES TO THE FINANCIAL STATEMENTS .900 Market value of quoted investment in Malaysia 6.869) (134.900 2.195) A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg61 . plant and equipment and their tax base Allowance for slow moving inventories Allowance for doubtful debts (56.240 15. DEFERRED TAX ASSETS Group 28.2007 RM Tax effects of differences between carrying amount of qualifying property.006.2.474) (709.

Addition through acquisition of subsidiary companies .2007 RM 59.442.560 Trade receivables comprise amounts receivable from sales of goods.246 2. plant and equipment Sundry deposits Prepayments of expenses 315.2007 RM At cost:Raw materials Work-in-progress Finished goods Goods in transit 6.265.2.500 546.NOTES TO THE FINANCIAL STATEMENTS .215 (290.Addition during the financial period 64.607 1. TRADE RECEIVABLES Group 28.698) (242.502.490) 98. 18.28 FEBRUARY 2007 16. The credit terms granted on sales of goods ranged from 30 days to 60 days.912 889. OTHER RECEIVABLES Group 28.957) 63.2007 RM Non-trade receivables Deposit paid to customs Deposit for purchase of property.2.083 101.032.120 338.2.374 Less: Allowance for slow moving inventories 17.864 (2. INVENTORIES Group 28.217 Pg62 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .019.636 Company 28.689 554.217 59.674.449.081 748.908.2.262 92.2007 RM Trade receivables Less: Allowance for doubtful debts . Allowance has been made for estimated irrecoverable of trade receivables based on the default experience of the Company.767.

The fixed deposits with licensed banks are on floating rate basis and will be matured within 6 months to 12 months.160 233.792 22.25% per annum. 20. Registered debentures covering fixed and floating charge on fixed and floating assets of a subsidiary company.2007 RM Current 23.535 pledged to the banks for banking facilities granted to the Group.000 Included in the current fixed deposits with licensed banks of the Group is an amount of RM11. and Fixed deposits.086 2.246 290. The credit terms granted to the Company ranged from 30 days to 60 days. 21.070 Company 28.2007 RM 238.2007 RM Non-trade payables Deposits received Accruals of expenses Finance creditors 666.414 979.SECURED The bank overdrafts of the Group are secured against the following:(a) All landed properties of the Group except for a freehold land and shophouse of a subsidiary company.2.2007 RM 12. Joint and several guarantee by certain Directors of the Company.NOTES TO THE FINANCIAL STATEMENTS . TRADE PAYABLES Group Trade payables comprise amounts outstanding for trade purchases.2.28 FEBRUARY 2007 19.2.131.546 52. (b) (c) (d) Interest is charged at rates ranging from 6. FIXED DEPOSITS WITH LICENSED BANKS Group 28.2. OTHER PAYABLES Group 28.13% to 8.410 765.644.131.535 Company 28. BANK OVERDRAFTS .000. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg63 .

NOTES TO THE FINANCIAL STATEMENTS - 28 FEBRUARY 2007
23. REVENUE Group 15.5.2006 to 28.2.2007 RM Sales of goods Dividend income Management fee 90,584,227 90,584,227 Company 15.5.2006 to 28.2.2007 RM 4,794,554 354,000 5,148,554

24.

PROFIT BEFORE TAXATION Profit before taxation has been determined after charging/(crediting) amongst other items the following:Group 15.5.2006 to 28.2.2007 RM Allowance for doubtful debts Allowance for slow moving inventories Auditors’ remuneration - statutory - non statutory - other auditors Depreciation Directors’ remuneration - fees - other emoluments Direct operating expenses of investment properties: - revenue generated during the financial period Hire of machinery Interest expense - hire purchase/finance lease - term loans/bonds - bank overdrafts - overdue - trust receipts/bankers acceptance/LC charges Rental - premises - warehouse - office equipment - crane - yard Loss on foreign exchange - realised - unrealised Dividend income Gain on disposal of property, plant and equipment Interest income from fixed deposits Rental income 242,957 2,767,490 67,500 167,800 37,318 891,652 125,500 1,127,812 168,443 11,524 62,312 721,968 75,552 42 1,173,147 162,613 83,714 1,620 12,989 367,781 438,385 220,595 (1,066) (189,877) (259,851) Company 15.5.2006 to 28.2.2007 RM 10,000 2,200 25,500 104,426 (4,794,554) (8,836) -

Pg64

PANTECH GROUP HOLDINGS BERHAD (733607-W)

A n n u a l

R e p o r t

2 0 0 7

NOTES TO THE FINANCIAL STATEMENTS - 28 FEBRUARY 2007
24. PROFIT BEFORE TAXATION (CONT’D) The estimated monetary value of benefits provided to the Directors of the Group during the financial period by way of usage of the Group’s assets and other benefits amounted to RM67,150. The remuneration paid to the Directors of the Company is categorised as follows:Other emoluments RM 729,046 729,046 Benefitsin-kind RM 62,550 62,550

Fees RM 28.2.2007 Executive Directors Non-Executive Directors Total 75,000 25,500 100,500

Total RM 866,596 25,500 892,096

The remuneration paid to the Directors of the Company analysed into bands are as follows:28.2.2007 RM100,000 to RM200,000 2 RM200,001 to RM500,000 2 -

Number of Directors Executive Directors Non-Executive Directors

<RM100,000 4

25.

TAXATION Group 15.5.2006 to 28.2.2007 RM Current period’s provision Transferred to deferred taxation Transferred to deferred tax assets 1,207,030 1,219,204 (822,195) 1,604,039 Company 15.5.2006 to 28.2.2007 RM 1,358,530 1,358,530

A n n u a l

R e p o r t

2 0 0 7

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Pg65

NOTES TO THE FINANCIAL STATEMENTS - 28 FEBRUARY 2007
25. TAXATION (CONT’D) Provision for current period’s taxation is determined by applying the Malaysian statutory tax rate on the chargeable income. The reconciliation of income tax expenses applicable to profit before taxation at the statutory tax rate to the income tax expenses at the effective tax rate of the Group and of the Company are as follows:Group 15.5.2006 to 28.2.2007 RM Profit before taxation Taxation at Malaysian statutory tax rate of 27% Tax effects in respect of:Change in tax rate for the first tranche of chargeable income Expenses not deductible for tax purposes Income not subject to tax Expenses allowable for double deduction Effective tax expenses 28,361,905 7,657,714 Company 15.5.2006 to 28.2.2007 RM 4,992,648 1,348,015

(29,722) 494,809 (6,486,433) (32,329) 1,604,039

10,515 1,358,530

However, the above amounts are subject to the approval of the Inland Revenue Board of Malaysia.

26.

EARNINGS PER SHARE The earnings per share has been calculated based on Group’s profit after taxation of RM26,757,866 and the weighted average number of shares in issue during the financial period of 40,790,984.

27.

EMPLOYEE BENEFITS EXPENSES Group 15.5.2006 to 28.2.2007 RM Staff costs 3,558,792 Company 15.5.2006 to 28.2.2007 RM 104,426

Included in employee benefits expenses of the Group and of the Company is Directors’ remuneration of RM1,127,812 and RM104,426 respectively and defined contribution plan for the Group of RM83,308.

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PANTECH GROUP HOLDINGS BERHAD (733607-W)

A n n u a l

R e p o r t

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dividend received Transactions with an associate company:.000 4.768 7.112 2.131.65% .794.2006 to 28.758 1.444 354.2007 RM Transactions with subsidiary companies:.00% 4.50% .239.407.550.477 3.28 FEBRUARY 2007 28.854 6.491 61.25% 2.575 831.5.38% 7.477 979.25% 7.831.sales .211 817.purchase Company 15.443 6.550.purchase Transaction with joint venture company:.443 6.13% .3.NOTES TO THE FINANCIAL STATEMENTS .045 20. SIGNIFICANT RELATED PARTY TRANSACTIONS Group 15.554 - The Directors of the Company are of the opinion that the terms of transactions have been entered on a negotiated basis.112 2.2.407.75% 8.64% A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg67 .658.470 20.332 47.2007 Financial asset Fixed deposits with licensed banks Financial liabilities Term loans Collaterised loan obligations Domestic resource factoring Trust receipts Bankers acceptance Bank overdrafts Hire purchase and finance lease 1 to 5 years RM Total RM 23.5.922.535 2.2006 to 28.2007 RM 3.2.2.8.65% . 29.70% 1.658.management fee received .669.535 - 23.566.8.000 2.8.5. FINANCIAL INSTRUMENTS (a) Interest rate risk The interest rate risk that financial instruments’ values will fluctuate as a result of changes in market interest rates.239.276.000.297.00% .55% 6.131.758 1.086 5.8.47% . and the effective weighted average interest rates on classes of financial assets and financial liabilities are as follows:Effective interest rates during the financial period Less than 1 year RM Group 28.643.491 61.

000 2.000.240 # - - Pg68 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .60% (b) Credit risk The maximum credit risk associated with recognised financial assets is the carrying amount shown in the balance sheets.435 * 40.200 * - - 121.923 6.65% . FINANCIAL INSTRUMENTS (CONT’D) (a) Interest rate risk (Cont’d) Effective interest rates during the financial period Less than 1 year RM Company 28.2007 Financial asset Fixed deposits with licensed banks 1 to 5 years RM Total RM 12.000.2.2007 Unquoted shares in subsidiary companies Unquoted shares in an associate company Unquoted shares in joint venture company Quoted investment in Malaysia Subordinated bond - - 72.000.900 2.3.000 * 6.28 FEBRUARY 2007 29. The Group and the Company have no significant concentration of credit risk with any single counterparty.NOTES TO THE FINANCIAL STATEMENTS .000 - 12. (c) Fair values The carrying amounts of all financial assets and liabilities of the Group and of the Company as at the balance sheet date approximated their fair values except as set out below:Group Carrying amount RM Fair value RM Company Carrying Fair amount value RM RM 28.271.2.

at the end of the financial period. FINANCIAL INSTRUMENTS (CONT’D) (c) Fair values (Cont’d) * It was not practicable within the constraints of timeliness and costs to estimate these fair values reliably.2. and Jayee Holdings Sdn.5. (“PCSB”) together with its subsidiary companies. On 8 November 2006. Bhd. Ltd (“PCPL”).2007 RM Group Unquoted shares in an associate company Unquoted shares in joint venture company Company Unquoted shares in subsidiary companies 98. which resulted in the Company becoming the holding company for PCPL. However.2006 to 28.NOTES TO THE FINANCIAL STATEMENTS . On 15 February 2007.2.174 # It was not practicable within the constraints of timeliness and costs to estimate these fair values reliably. A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg69 .642 2. the net tangible assets reported by the subsidiary companies.28 FEBRUARY 2007 29.244 133.. Bhd. which resulted in the Company becoming the holding company for PSISB. Bhd. the Company acquired the entire issued and paid-up share capital of Pantech Steel Industries Sdn. However.814 31. SIGNIFICANT EVENTS DURING THE FINANCIAL PERIOD On 7 November 2006. the Company acquired the entire issued and paid-up share capital of Pantech Corporation Sdn.191.999 174. (“PSISB”).2007 RM Authorised but not contracted for:Purchase of motor vehicle and forklift Authorised and contracted for:Purchase of plant and machinery 269. Bhd. CAPITAL COMMITMENTS Group 28. which resulted in the Company becoming the holding company for PCSB.053. the Company acquired the entire issued and paid-up share capital of Panaflo Controls Pte. 30. the fair value of the subordinated bond is assumed to be the same as carrying amount as it is immaterial in the context of the financial statements. at the end of the financial period. associate company and joint venture company were as follows:15. On 10 November 2006. Pantech (Kuantan) Sdn. the entire enlarged issued and paid-up share capital of the Company was successfully listed on the Main Board of Bursa Malaysia Securities Berhad.

554 (9.NOTES TO THE FINANCIAL STATEMENTS . tees. flanges.121 16.854 Investments and management RM Eliminations RM Consolidated RM - - 90.830. palm oil refining and other related industries. property investment and management service.285. SEGMENTAL REPORTING . marine.2007 Revenue External revenue Inter-segment revenue Total revenue 74.692) (9. Manufacturing and supply of butt-welded carbon steel fittings such as elbows. The financial statements for current financial period do not reflect this proposed dividend. onshore and offshore heavy engineering.227 3. in respect of the financial period ended 28 February 2007.584.373 15.000 ordinary shares amounting to a dividend payable of RM3. gas reticulation. end-caps and high frequency induction long bends for use in the oil and gas and other related industries. petrochemicals. valves and other related products for use in the oil and gas.390 846.703.000. if approved by the shareholders.836. 33.28 FEBRUARY 2007 32.148. of 3 sen less 27% income tax per ordinary share on 150. supply and stocking of high pressure seamless and specialised steel pipes. fittings. Investment holding. Manufacturing fittings and of pipes flow controls and fittings RM RM 28. Such dividend.692) 90.148.880.GROUP (a) Primary segmental reporting .554 5.2.584.830.975 5. SIGNIFICANT EVENT SUBSEQUENT TO THE BALANCE SHEET DATE At the forthcoming Annual General Meeting. a final dividend.227 Pg70 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .000 will be proposed for shareholders’ approval.Business segment The Group is organised on a worldwide basis into three major business segments as follows:Business segments Trading of pipes. power generation.726. will be accounted for in equity as an appropriation of retained earnings in the financial year ending 28 February 2008.017 78. Manufacturing of pipes and fittings Investments and management Trading of pipes.539. reducers. fittings and flow controls Business activities Trading.

200 - - - 40.517) 28.GROUP (CONT’D) (a) Primary segmental reporting .806.438.981 (1.908 4.224 (86.28 FEBRUARY 2007 33.286 17.200 121.225 (1.807 287.539.117 (85.983 (38.039) 26.877 30. Manufacturing fittings and of pipes flow controls and fittings RM RM 28.088 (86.761) 239.302) 65.285.361.300 3.710) 3.727.761) 240.564.403.2007 Results Segment results Interest income Profit from operations Finance costs Share of profit in associate company Share of loss in joint venture company Profit before taxation Taxation Profit after taxation Other information Segment assets Investment in an associate company Investment in joint venture company Deferred tax assets Tax recoverable Consolidated total assets 188.455.236.012 (2.337 9.983 - - - 13.088.350.035 36.699 A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg71 .757.467.517) 7.827.379.872.Business segment (Cont’d) Trading of pipes.136 - 121.311.717 36.NOTES TO THE FINANCIAL STATEMENTS .483 48.783 (258.835 17.479 3.189) (65.066.232.527.464.539.293 101.302 30.471 8.976) 17.923 901.302) (65.044 189.181 198.306 (67.302.604.195 130.573) Investments and management RM Eliminations RM Consolidated RM 13.195 - 125.400) 17.091.2.397.135 189.534.905 (1.118) 6.201 101.044 9.863 3.866 40.475.717 - (38.725.923 901. SEGMENTAL REPORTING .

(b) Secondary segmental reporting – Geographical segment There is no geographical segment information as the Group is predominantly operating in Malaysia. SEGMENTAL REPORTING .637.Business segment (Cont’d) Trading of pipes.28 FEBRUARY 2007 33.888.808 1.170. plant and equipment Depreciation 107.486. inventories.601.812 880.690 64.589 409.573.600 1.808 2. receivables and operating cash.974.851 435.614.230 142. Segment liabilities comprise operating liabilities and exclude items such as taxation.NOTES TO THE FINANCIAL STATEMENTS .165 891. plant and equipment.833 - 1.101 1.101 987.264) 122. Capital expenditure comprises additions to property.230.217. and mainly exclude investment in an associate company. deferred tax assets and tax recoverable.000 1. 34.290.000 (11.033. plant and equipment.404 Investments and management RM Eliminations RM Consolidated RM 109.2007 Other information (Cont’d) Segment liabilities Tax payable Deferred taxation Consolidated total liabilities Capital expenditure on property.690 (11.285 22.799.314 313. COMPARATIVE INFORMATION There are no comparative figures as this is the first set of financial statements being prepared.404 21. including additions resulting from acquisition through business combinations.486.073 1.652 Segment assets consist primarily of property.GROUP (CONT’D) (a) Primary segmental reporting .2.735. investment in joint venture company. Manufacturing fittings and of pipes flow controls and fittings RM RM 28. Pg72 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .264) 119.

2006 7 11.2.2006 8 (1.556) 223.2. Jalan Tembaga Satu.9.2. Johor HS (D) 206664 Lot PTD No.2006 6 (4.17 Factory D .500 Freehold A double storey corner shophouse 600 16 22.2.954 8 22. C and D ) A single storey detached warehouse with a 3-storey office building annexed A single storey semi-detached factory with a 3-storey office annexed No. Taman Perindustrian Plentong. Johor (72. 81700 Pasir Gudang.13 acres Freehold Two parcels of agriculture land 330 N/A 22. Tanjong Puteri Resort. Mukim Plentong.2045 3.2006 Description / existing use 4 units of single storey detached factories ( identified for reference as “ Factory A.2007 building last RM. (378. B. Johor Darul Takzim PLO 234.000 Years revaluation 19.2. Johor Darul Takzim HS (M) 2633 Lot PTD No. Selangor Tenure Freehold 2 PTD 71061. 1 and 1A Jalan Molek 2/1 Taman Molek 81100 Johor bahru. 81100 Johor Bahru. Johor No.704) 4. Johor (87.808) 11. HS(D) 228518. Jalan Mutiara Emas 4/20 Taman Mount Austin.2006 4 PTD 112716 Jalan Sungai Tiram Batu 16 81800 Ulu Tiram. Jalan Sungai Tiram Mukim Plentong District of Johor Bahru.120) 39.2006 3 (11. 18 & 18A. 85407 Mukim of Plentong District of Johor Bahru. Johor 18th Mile Johor bahru Kota Tinggi main road Kota Tinggi. Jalan Mutiara 4.930 Freehold A 1 1/2 storey intermediate terrace factory 350 15 22. Jalan Lampam 41. District of Johor Bahru. Johor HS (M) 373 and 337 Lot MLO No. Geran 73035 Mukim Plentong. Johor (2.2. HS(D) 125023. Johor No.800) 3. District of Johor Bahru. 3810 and 3818 Mukim of Kota Tinggi.080 Freehold A double storey intermediate shophouse 280 10 22. 12. 4.540) 3.2.600 Leasehold expiring on 30. 1 Tittle details Geran 95059 and 95060 Lot No. Pasir Gudang Industrial Estate. 23191 and 23192 Mukim Kapar Dsitrict of Klang Address Lot 13258 and 13259 Jalan Haji Abdul Manan Off Jalan Meru 41050 Klang.453 Net book Approximate value age of Date of @ 28.ft.092) 14.904 Factory A.000 Freehold A single storey detached warehouse with double storey office annexed 940 5 22.15 22. Mukim Plentong.800 7 22.2.2. 59129 Mukim of Tebrau District of Johor Bahru. District of Johor Bahru.640 Freehold 1. Johor PTD 102866. Johor No. B & C . 81750 Masai. Johor Darul Takzim Lot 64305. 81700 Pasir Gudang. 112716 Batu 16.2006 A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg73 .2006 5 No. Johor HS (D) 169521 Lot PTD No.LIST OF PANTECH GROUP’S PROPERTIES AS AT 28 FEBRUARY 2007 ( Land area ) Gross build-up area Sq.

of Shares 100 269.41 100.400 20. 4.001 – 10.494.33 16. of Shares 36.000.000 % of Shares 0.000.18 1.000.000 100.815. 7. 3. 3.16 23. Chew Ting Leng Goh Teoh Kean Tan Ang Ang To Tai Wai Tan Sui Hin Saw Siew Ee Abdul Karim Bin Ahmad % 2.400 - No.33 16.200 150.494.494. Names 1. of Shares 36.400 No.ANALYSIS OF SHAREHOLDINGS AS AT 29 JUNE 2007 Authorized Share Capital Issued and Fully Paid-Up Share Capital Class of Shares Voting Rights No.000 30. 7.65 100.815.300 58. CTL Capital Holding Sdn Bhd GL Management Agency Sdn Bhd Koperasi Permodalan Felda Berhad Chew Ting Leng Shum Kah Lin Goh Teoh Kean Lee Sock Kee % 24.894.400 6.02 0.35 6.200 24.100 30.659.20 0.33 24.200 4.54 16.100 2.200 24.400 24.33 38. 5. 6.238 % of Shareholders 0.815.001 – less than 5% of issued shares 5% and above of issued shares Total LIST OF SUBSTANTIAL SHAREHOLDERS AS AT 29 JUNE 2007 Direct No.28 15.77 - % 24. 2. Names 1. of Shareholders 2 288 672 190 81 5 1.000. of Shareholders : : : : : RM500.93 4.54 13.50 Each One Vote Per Ordinary Share 1.026.02 0.494.494.00 No.969.238 DISTRIBUTION OF SHAREHOLDINGS AS AT 29 JUNE 2007 Category No.200 36.600 Indirect No. 5. 6.000 15.000 1. 2.815. 4. of Shares 36.000 Indirect No.01 % 24.900 81.000 10.54 (a) (b) (c) (d) DIRECTORS’ INTERESTS IN SHARES AS AT 29 JUNE 2007 Direct No.33 16.372.00 RM75.802.200 24. of Shares 3.001 – 100.26 54.91 54.54 (a) (c) Note: (a) Deemed Interest pursuant to Section 6A of the Act through his and his spouse Shum Kah Lin’s interest in CTL Capital Holding Sdn Bhd (b) Deemed Interest pursuant to Section 6A of the Act through her and her spouse Chew Ting Leng’s interest in CTL Capital Holding Sdn Bhd (c) Deemed Interest pursuant to Section 6A of the Act through his and his spouse Lee Sock Kee’s interest in GL Management Agency Sdn Bhd (d) Deemed Interest pursuant to Section 6A of the Act through her and her spouse Goh Teoh Kean’s interest in GL Management Agency Sdn Bhd Pg74 PANTECH GROUP HOLDINGS BERHAD (733607-W) A n n u a l R e p o r t 2 0 0 7 .00 Ordinary Shares of RM0.02 3.00 Less than 100 100 – 1.54 0.000.

002 2. 2.76 0.000 1.79 0.000 922.000 1. 22.000 1.864.21 1.616.019 3.027.314 1. 19. 23. 3. 29.189.800 1.195 2.000 16. 14. 13. 11.086 1. 10.88 0.75 0.11 1.024.77 13.800 2. BHD.54 1. 12.268.800.35 1. 26.659.600 20. 9.24 1.48 2.35 1.00 0.195.129.314 1.68 0.07 1. 5. GL MANAGEMENT AGENCY SDN.000 3.000 1.134.186.61 82. BHD.200 2.606.310.85 0.200 13.100 1.106.75 0.00 9.20 1.13 2.06 1.381 11.06 7. 8.591.000 123.67 0.497.588. 25.66 A n n u a l R e p o r t 2 0 0 7 PANTECH GROUP HOLDINGS BERHAD (733607-W) Pg75 . 18. 24.305 1.098 2. 15.005.224.494. 20. LEE LIANG MONG AMANAH RAYA NOMINEES (TEMPATAN) SDN BHD (PUBLIC SMALLCAP FUND) TO TAI WAI LEE LIANG MONG TO TAI WAI TAN ANG ANG MAYBAN NOMINEES (TEMPATAN) SDN BHD (MAYBAN TRUSTEES BERHAD FOR PUBLIC AGGRESSIVE GROWTH FUND) MALAYSIA NOMINEES (TEMPATAN) SENDIRIAN BERHAD (GREAT EASTERN LIFE ASSURANCE (MALAYSIA) BERHAD (LGF)) SHUM BI SHIAN LEE LIANG MONG CITIGROUP NOMINEES (TEMPATAN) SDN BHD (EXEMPT AN FOR PRUDENTIAL ASSURANCE MALAYSIA BERHAD) MALAYSIA NOMINEES (TEMPATAN) SENDIRIAN BERHAD (GREAT EASTERN LIFE ASSURANCE (MALAYSIA) BERHAD (DR)) HSBC NOMINEES (TEMPATAN) SDN BHD (HSBC (MALAYSIA) TRUSTEE BERHAD FOR AMANAH SAHAM SARAWAK) LIM SOON BENG AMANAH RAYA NOMINEES (TEMPATAN) SDN BHD (PB BALANCED FUND) NG LEE LEE NG LEE LEE LIM SOON BENG MALAYSIA NOMINEES (TEMPATAN) SENDIRIAN BERHAD (OVERSEAS ASSURANCE CORPORATION (MALAYSIA) BERHAD (MGF)) SHUM BI SHIAN KONG CHIONG LEE SALINAH BINTI JA’AFAR CHAI CHAU @ PEH CHAI CHAU TAN ANG ANG MALAYSIAN NOMINEES (TEMPATAN) SENDIRIAN BERHAD (GREAT EASTERN LIFE ASSURANCE (MALAYSIA) BERHAD (LGF)) TOTAL Shareholding 20. 30.33 11. 4.186 1.314 1.46 1.07 1.600 1.318.74 1.125.67 0. KOPERASI PERMODALAN FELDA BERHAD CTL CAPITAL HOLDING SDN BHD CTL CAPITAL HOLDING SDN BHD GL MANAGEMENT AGENCY SDN.800 1.000.671. 6.989.07 1.026. Shareholders 1.809.086 1.500 % 13.000 1.000. 27. 16. 17. 28. 7.600.ANALYSIS OF SHAREHOLDINGS AS AT 29 JUNE 2007 LIST OF TOP 30 SHAREHOLDERS AS AT 29 JUNE 2007 No. 21.100 1.

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.......... Signature of shareholder(s)/Common Seal * Strike out whichever is not desired.………………………......... A member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote in his/her stead...…....... Prince Hotel & Residence Kuala Lumpur............... No. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy without limitation and the provisions of Section 149(1)(b) & (c) of the Companies Act.. of shares to be represented by proxy or failing him/her......... My/our proxy/proxies is to vote as indicated below:FIRST PROXY FOR Ordinary Resolution 1 Ordinary Resolution 2 Ordinary Resolution 3 Ordinary Resolution 4 Ordinary Resolution 5 Ordinary Resolution 6 Ordinary Resolution 7 Ordinary Resolution 8 Ordinary Resolution 9 Ordinary Resolution 10 Ordinary Resolution 11 Special Resolution 12 (Please indicate with a “ √ ” or “X” in the space provided how you wish your vote to be cast.... ………………………………....................... A member may appoint up to two (2) proxies to attend the same meeting provided that he specifies the proportion of his shareholding to be represented by each proxy......………………. (Full name in block letters) of ….......... it may appoint at least one (1) proxy in respect of each Securities account it holds with ordinary shares of the Company standing to the credit of the said securities account. Level 3.. the Chairman of the Meeting as my/our proxy to vote for me/us and on my/our behalf at the First Annual General Meeting of the Company to be held at Prince 3........... 2...........00am..............day of………………..... 3. ………………………………...... Where a member is an authorised nominee as defined under the Security Industry (Central Depositories) Act......….......................... ………......../CDS A/C No.... the proxy will vote or abstain from voting at his/her discretion).....………….... Jalan Sultan Ismail. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorized in writing or. 10th August 2007 at 10....................… ………………………………............………2007 ……………….............................…………… (Full address) being a member/members of PANTECH GROUP HOLDINGS BERHAD hereby appoint the following person(s):Name of proxy. Notes 1. 50450 Kuala Lumpur...I/C No..../Co.....… 2. 50250 Kuala Lumpur not less than 48 hours before the time set for holding the meeting or any adjournment thereof.....................… ……………………………….......... The Form of Proxy must be deposited at the Registered Office of the Company at Level 15-2.... 4...…...................... either under the Corporation’s Common Seal or under the hand of an officer or attorney so authorized.....… ………………………………....... Faber Imperial Court...... 1991.....…....... if the appointer is a corporation..TM PANTECH GROUP HOLDINGS BERHAD (Company No: 733607 W) (Incorporated in Malaysia) PROXY FORM (Before completing this form please refer to the notes below) I/We………………………………………...... Jalan Conlay.. 1965 shall not apply. & Address 1...............… No.........………...................................... SECOND PROXY FOR AGAINST AGAINST Dated this………………....... on Friday..… ………………………………........................ If no instruction as to voting is given.......... ........ NRIC No...

FOLD HERE FOLD HERE Affix stamp here The Secretary PANTECH GROUP HOLDINGS BERHAD (733607 W) Level 15-2. Faber Imperial Court Jalan Sultan Ismail 50250 Kuala Lumpur FOLD HERE .