RNS Number:5815M
Tanjong PLC
20 June 2003
TANJONG public limited company
(Incorporated in England 1926 - No. 210874)
(Registered as a foreign company in Malaysia - No. 990903-V)
QUARTERLY REPORT FOR THE QUARTER ENDED 30 APRIL 2003
Condensed Group Profit and Loss Account
3 months ended
in RM'000 Note 30-Apr-03 30-Apr-02
(Unaudited)
Group turnover 8 622,698 609,005
Operating costs (482,070) (485,824)
Group operating profit 8 140,628 123,181
Share of associated undertakings
and joint venture 233 563
Group operating profit after share
of associated undertakings and joint 140,861 123,744
venture
Net interest expense and
investment charge (19,966) (10,740)
Profit on ordinary activities 120,895 113,004
before taxation
Taxation (33,036) (34,609)
Profit on ordinary activities after 87,859 78,395
taxation
Minority interests (3,905) (7,122)
Net profit for the period 83,954 71,273
Earnings per share (sen)
- Basic 21.7 18.6
- Diluted 21.6 18.5
The condensed group profit and loss account should be read in conjunction with
the Group's annual financial statements for the year ended 31 January 2003.
Condensed Group Balance Sheet
As at As at
30-Apr-03 31-Jan-03
in RM'000 (Unaudited) (Audited)
Tangible assets* 2,677,261 2,553,804
Investment property 365,000 365,000
Intangible assets 55,738 56,682
Investments in associate and joint venture 26,879 31,155
Long term investments 5,833 6,356
Current Assets
Stocks 106,553 114,889
Debtors 260,376 205,908
Investments and 935,152 708,190
short term placements
Cash at bank and in hand 22,498 13,798
1,324,579 1,042,785
Current Liabilities
Creditors 297,131 324,817
Short term borrowings 62,557 362,368
Taxation 6,965 14,601
Dividends payable 78,061 78,061
444,714 779,847
Net current assets 879,865 262,938
Long term liabilities
Borrowings and other 1,814,360 984,389
long term liabilities
Deferred taxation 211,169 200,108
1,985,047 2,091,438
Capital and Reserves
Paid up share capital 138,156 138,102
Share premium account 110,747 109,733
Revaluation reserve 9,915 9,915
Profit and loss account 1,651,535 1,568,220
Equity Shareholders' funds 1,910,353 1,825,970
Minority interests 74,694 265,468
1,985,047 2,091,438
Net Tangible Assets per share (in sen) 478.8 456.9
* Included in tangible assets is construction-in-progress amounting to
RM14.1 million (31.01.2003 - RM781.5 million)
The condensed group balance sheet should be read in conjunction with the
Group's annual financial statements for the year ended 31 January 2002.
Condensed Group Cash Flow Statement
3 months ended
in RM'000 30-Apr-03 30-Apr-02
(Unaudited)
Profit on ordinary activities before taxation 120,895 113,004
Adjustment for non-cash and non-operating items:
Depreciation & amortisation 42,643 30,149
Others 19,732 10,178
183,270 153,331
Changes in working capital (46,444) (13,510)
Net cash inflow from operating activities 136,826 139,821
Returns on investments and servicing of
finance:
Interest received 4,998 3,378
Interest paid (18,072) (14,289)
Dividend received 227 91
from current asset
investments
Net cash outflow from returns
on investments and servicing of finance (12,847) (10,820)
Corporate income taxes paid (29,570) (13,676)
Capital expenditure (4,329) (2,200)
Acquisitions and disposals:
Construction of a (114,780) (114,439)
power generation plant
Acquisition of (267,805) -
minority interests
in a subsidiary
Investment in (130) -
venture funds
Repayment from a 4,500 -
joint venture
Net cash outflow from acquisitions and (378,215) (114,439)
disposals
Management of liquid resources:
Increase in funds (238,728) (133,201)
placed on term deposits
Current asset investments 4,496 762
-
Net cash outflow from management of liquid (234,232) (132,439)
resources
Financing activities:
Issue of ordinary shares 1,067 29,180
Net increase in borrowings 530,000 130,000
Net cash inflow from financing activities 531,067 159,180
Decrease in cash and bank balances 8,700 25,427
Cash and bank balances at beginning of the 13,798 14,451
year
Cash and bank balances at period end 22,498 39,878
The condensed group cash flow statement should be read in conjunction with the
Group's annual financial statements for the year ended 31 January 2003.
Condensed Group Statement of Changes in Equity
Non-distributable Distributable
Profit Total
and
Share Share Revaluation Loss 30-Apr-03 31-Jan-03
in RM'000 Capital Premium Reserve Account (Unaudited) (Audited)
Balance 138,102 109,733 9,915 1,568,220 1,825,970 1,575,304
brought
forward
Movements
during
the
period:
Net - - - 83,954 83,954 323,119
profit
for the
period
Issuance
of shares
arising
from
exercise 54 1,014 - - 1,068 46,255
of share
options
Dividends - - - - - (117,482)
Exchange
differences
on foreign
currency - - - (639) (639) (1,226)
net
investments
Balance 138,156 110,747 9,915 1,651,535 1,910,353 1,825,970
carried
forward
The condensed group statement of changes in equity should be read in
conjunction with the Group's annual financial statements for the year ended
31 January 2003.
Part A Explanatory notes in compliance with MASB Statement 26
1. Basis of preparation
The Quarterly Report has been prepared in accordance with the reporting
requirements outlined in Malaysian Accounting Standards Board ("MASB")
Standard No. 26 - "Interim Financial Reporting" and Paragraph 9.22 of the
Kuala Lumpur Stock Exchange Listing Requirements and should be read in
conjunction with the Group's annual audited financial statements for the year
ended 31 January 2003.
The accounting policies adopted by the Group comply with United Kingdom
Generally Accepted Accounting Practices ("UK GAAP).
2. Qualification of preceding annual financial statements
There was no audit qualification to the preceding annual audited financial
statements of the Group.
3. Seasonal / cyclical factors
The principal business operations of the Group are not materially affected by
seasonal or cyclical factors.
4. Unusual items
There were no unusual items affecting assets, liabilities, equity, net
income, or cash flows during the period under review.
5. Material changes in estimates of amounts reported
There were no material changes in estimates of amounts reported in the prior
financial year.
Part A Explanatory notes in compliance with MASB Statement 26
6. Movements in debt and equity securities
6.1 Issuance of debt securities
Panglima Power Sdn Bhd ("Panglima"), a subsidiary of Tanjong issued
redeemable bonds with a nominal value of RM830 million in two tranches, RM500
million on 7 March 2003 and RM330 million on 19 March 2003.
6.2 Issuance of equity securities
For the period under review, 154,000 shares in the Company were issued for a
total subscription amount of RM1.1 million pursuant to the exercise of
options to subscribe for unissued shares of the Company by eligible employees
under the Company's Employees' Share Option Scheme No. 2.
7. Dividends paid
There were no dividends paid during the quarter under review.
8. Segmental results
3 months ended 3 months ended
30-Apr-03 30-Apr-02
Operating Operating
in RM' 000 Turnover profit/(loss) Turnover profit/(loss)
Malaysia
Numbers 380,934 37,417 383,393 54,584
Forecast
Operations
("NFO")
Power 217,189 96,638 200,300 61,538
Generation
Racing 5,564 209 5,932 756
Totalisator
Operations
("RTO")
Property 11,912 7,403 11,226 7,146
Investment
615,599 141,667 600,851 124,024
People's
Republic of
China
Liquefied 9,270 (652) 10,294 (343)
Petroleum Gas
("LPG")
Segment totals 624,869 141,015 611,145 123,681
Inter-segment (2,171) (2,140)
elimination
Non-segmental (387) (500)
expenditure
622,698 140,628 609,005 123,181
Part A Explanatory notes in compliance with MASB Statement 26
9. Valuations of property, plant and equipment
The valuation of the investment property of RM365 million held by the Group
has been brought forward without amendments from the previous annual audited
financial statements.
10. Material events subsequent to the end of the financial period
There were no material subsequent events as at the date of this quarterly
report.
11. Changes in the composition of the Group
Apart from the developments reported in Note 21(a), there have been no
changes in the composition of the Group during the financial year.
12. Commitments and contingencies
12.1 Capital commitments as at 30 April 2003
RM'000
Authorised and contracted 47,319
Authorised but not contracted 23,389
70,708
The above commitments relate primarily to project completion costs and other
ancillary capital expenditure that will be incurred in relation to the
Panglima power plant and related facilities.
12.2 Contingencies
There were no material contingent liabilities or contingent assets since the
last annual balance sheet date.
Part A Explanatory notes in compliance with MASB Statement 26
13. Significant related party disclosures
The following is a summary of material transactions as defined by Financial
Reporting Standard 8, "Related Party Disclosures", which have been contracted
in the ordinary course of business and on normal commercial terms between the
Group and companies that are associated with:
(i) The trust that is associated with the family of Ananda Krishnan
Tatparanandam and foundations ("the Trust") and
(ii) The family of Ananda Krishnan Tatparanandam.
The trustee of the Trust is the controlling shareholder of the Company as
defined by the United Kingdom Financial Services Authority Listing Rules.
3 months ended
30- Apr-03 30-Apr-02
RM'000 RM'000
Expenses charged to the Group profit and loss
account
Consultancy services 3,893 3,500
Technical advisory, operations & maintenance 1,337 1,925
services
Software support and licence fees 1,155 1,155
Building and property maintenance services 772 790
Closed circuit television broadcasting services 572 572
Equipment lease rentals 420 420
Telecommunication and related services 393 323
Bloodstock management, service fees, 365 -
accounting &
clerical services
Sponsorship of events 337 75
Other services 216 132
9,460 8,892
Income credited to the Group profit and loss account
Lease rental and tenant service revenue 5,632 5,220
Car park income 204 25
Others 50 12
5,886 5,257
Recovery of expenses and shared overhead costs 1,879 1,668
Part B Explanatory notes in compliance with KLSE Listing Requirements
(Part A of Appendix 9B)
14. Review of performance
Group turnover for the current quarter increased by RM13.7 million to RM622.7
million from RM609.0 million in the corresponding quarter in the previous
year ("corresponding quarter"). Group operating profit is, at RM140.6
million, higher by RM17.4 million or 14.1%.
The increased Group turnover is mainly attributable to the additional
contribution from Panglima, which successfully converted its 460MW Open Cycle
Gas Turbine power plant into a 720MW Combined Cycle Gas Turbine power plant
on 31 March 2003. The increase in capacity billings arising from the
commercial operations of the Panglima plant as well as lower plant
maintenance costs have contributed to the increase in Power Generation's
operating profit from RM61.5 million to RM96.6 million.
Despite a higher prize payout structure which took effect on 1 January 2003,
consumer demand for NFO products continues to be soft. The said revision to
the prize payout structure and an increase in Betting and Sweepstake duties
on the same date have reduced operating margins thereby leading to a
reduction in the NFO operating profit from RM54.6 million in the
corresponding quarter to RM37.4 million in the current quarter.
Net interest expense and investment charge increased from RM10.7 million to
RM20.0 million, largely due to increased interest expense on additional
borrowings. As at 30 April 2003, Group borrowings totalled RM1.87 billion
against RM1.28 billion in the corresponding quarter, as additional borrowings
were taken to finance the development of the Panglima power plant.
For the period under review, Group profit attributable to shareholders
increased by 17.8% from RM71.3 million to RM83.9 million. Net earnings per
share has accordingly increased from 18.6 sen to 21.7 sen.
15. Variation of current quarter's profit before tax to preceding quarter
The current quarter's profit before taxation of RM120.9 million is lower than
the preceding quarter's profit before taxation of RM123.5 million due to the
reduced operating margin of the NFO segment mitigated by the increased profit
contribution of Panglima.
16. Current year prospects
Demand for NFO products has been sluggish since the end of the quarter under
review whilst the Power Generation segment has generally performed in line
with expectations. Barring unforeseen circumstances, the Board of Directors
anticipates a satisfactory overall performance for the Group for the
remainder of this financial year.
Part B Explanatory notes in compliance with KLSE Listing Requirements
(Part A of Appendix 9B)
17. Variance to profit forecast or shortfall in profit guarantee (only
applicable to the final quarter)
The Group did not issue a profit forecast during the period under review.
18. Taxation
Individual/Cumulative Quarter
30/4/2003 30/4/2002
RM'000 RM'000
Malaysian Taxation
Income tax
- Current year 25,176 24,740
- Prior year (46) -
25,130 24,740
Deferred tax 11,000 9,709
36,130 34,449
Foreign Taxation (3,094) 160
33,036 34,609
The effective tax rate for the current quarter was 27.3% whereas the
statutory tax rate is 28%. The variance between the tax rates is mainly due
to the write back of withholding tax provisions.
19. Sale of unquoted investments and/or properties
There were no disposals of unquoted investments and/or properties during the
period under review.
Part B Explanatory notes in compliance with KLSE Listing Requirements
(Part A of Appendix 9B)
20. Quoted securities
(a) Summary of dealings in quoted securities Individual/
for the year ended 30 April 2003: - Cumulative Quarter
RM'000
(i) Total purchase consideration -
(ii) Total sale proceeds 653
(iii) Total profit on disposal 126
(b) Investments in quoted securities as at the end of the reporting
period:
RM'000
(i) At cost 69,540
(ii) At carrying value/book value; and 60,578
(iii) At market value 71,522
21. Status of corporate proposals announced but not completed
(a) Status of the General Offer for the remaining shares in Powertek Berhad
The general offer for the remaining shares in Powertek Berhad (offer shares)
undertaken by Tanjong Energy Holdings Sdn Bhd ("TEH") was completed on 21
February 2003.
As a result of TEH having received acceptances for not less than nine-tenths
of the offer shares (other than shares held by TEH; its nominees or its
related corporations), TEH was able to invoke the compulsory acquisition for
the remaining shares of 1,898,526 for which acceptances were not received, in
accordance with Section 34 of the Malaysian Securities Commission Act, 1993.
The compulsory acquisition was completed on 30 April 2003, upon which
Powertek and its wholly-owned subsidiaries became wholly-owned subsidiaries
of TEH, and in turn, Tanjong.
(b) Status of utilisation of proceeds raised from corporate proposals
As disclosed in Note 6, Panglima had during the quarter issued serial bonds
with a total nominal value of RM830 million. These serial bonds form part of
the RM1.22 billion financing facility obtained for the development of
Panglima's 720MW Combined Cycle Gas Turbine power plant
Part B Explanatory notes in compliance with KLSE Listing Requirements
(Part A of Appendix 9B)
22. Group borrowings and debt securities
Short Long Total
Term Term
RM'000 RM'000 RM'000
Secured
Al-Murabahah Commercial Papers* 24,837 - 24,837
Al-Bai' Bithaman Ajil 30,000 420,000 450,000
Islamic Debt Securities ("BaIDS")*
Al-Murabahah Medium Term Notes* - 55,000 55,000
Serial bonds** 830,000 830,000
Syndicated loan 7,720 153,240 160,960
62,557 1,458,240 1,520,797
Unsecured
Redeemable bonds - 350,000 350,000
As at 30 April 2003 62,557 1,808,240 1,870,797
* These debt securities are secured by way of assignment of its rights,
title, benefits and interest in and under certain insurances procured by
Pahlawan Power Sdn Bhd in relation to its properties, assets and business and
all amounts standing to the credit of its finance service reserve account.
** These debts are undertaken by Panglima Power Sdn Bhd and are secured
against a debenture over its assets and properties, a charge over its landed
properties, an assignment of its rights, title, benefits and interest in and
under certain insurances and project agreements and an assignment of all
amounts standing to the credit of a designated project and debt service
reserve accounts of that subsidiary company.
Part B Explanatory notes in compliance with KLSE Listing Requirements
(Part A of Appendix 9B)
23. Off balance sheet financial instruments
Panglima is obliged to make progressive payments in EURO currency pursuant to
the Engineering, Procurement and Construction Contract ("EPC Contract")
entered for the construction and development of the new 720MW CCGT power
plant as well as supply contracts in relation to its procurement of materials
and parts. In this respect, Panglima has entered into forward contracts to
hedge the above payments.
At the date of this report, the amount outstanding under the forward
contracts entered into by Panglima is RM211.3 million (EURO 47.8 million at
forward contract rates ranging between RM4.37 to RM4.45 : EURO 1). The
forward contracts are executed with three (3) licensed financial institutions
and are accounted for on a basis which is consistent with the accounting
policies adopted by the Group. These contracts have various maturity periods
straddling over the next four months to meet the payment obligations under
the EPC Contract.
24. Changes in material litigation
There is no pending material litigation since the last annual balance sheet
date to the date of issue of this quarterly report.
25. Dividend
The Board had on 27 March 2003 when approving its unaudited results for the
fourth quarter and financial year ended 31 January 2003, recommended a final
gross dividend of 28 sen per share less Malaysian income tax at 28% in
respect of the financial year ended 31 January 2003. The proposed dividend,
if approved at the forthcoming Annual General Meeting scheduled on 26 June
2003, will be paid on 22 July 2003.
Part B Explanatory notes in compliance with KLSE Listing Requirements
(Part A of Appendix 9B)
26. Earnings per share ("EPS")
The basic and diluted EPS for the reporting period are computed as follows:
Current/
Cumulative Quarter
Net profit for the quarter (RM'000) 83,954
Weighted average number of ordinary shares 387,271,979
Dilutive effect* 817,283
Diluted average number of ordinary shares 388,089,262
Basic EPS (sen) 21.7
Diluted EPS (sen) 21.6
* arising from unexercised employee share options over unissued shares which
have a dilutive potential
By order of the Board
Siuagamy Ramasamy 20 June 2003
Group Company Secretary Kuala Lumpur
This information is provided by RNS
The company news service from the London Stock Exchange
END
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