Professional Documents
Culture Documents
: 4 7 4 4 2 3 - X Inco r p o ra t e d i n M a l a y s i a u n d e r t h e C o m p a n i e s A c t , 1 9 6 5
Annual Report 2 0 0 7
For Financial Ye a r E n d e d 31 August 2007
The
Wo r l
MALAYSIA
d is Ou r Market
El Salvador French Guiana Grenada Guatemala Guyana Haiti Honduras Jamaica Mexico Nicaragua Panama Paraguay Peru Suriname Trinidad & Tobago Uruguay Venezuela
EUROPE (47)
Albania Andorra Armenia Austria Azerbaijan Belarus Belgium Bosnia Herzegovina Bulgaria Canary Islands Croatia Cyprus Czech Republic Denmark
Estonia Finland France Georgia Germany Greece Hungary Iceland Ireland Italy Kosovo Latvia Lithuania Luxembourg Macedonia, FYR Malta Moldova
Montenegro Netherlands Northern Ireland Norway Poland Portugal Romania Russia Slovakia Slovenia Spain Sweden Switzerland Turkey Ukraine United Kingdom
ASIA (29)
Afghanistan Bangladesh Bhutan Brunei Cambodia China Hong Kong India Indonesia Japan Kazakhstan Korea Laos Macau
Malaysia Mongolia Myanmar Nepal New Caledonia Pakistan Philippines Singapore Sri Lanka Taiwan Thailand Tajikistan Turkmenistan Uzbekistan Vietnam
Lebanon MIDDLE EAST (15) Oman Bahrain Egypt Iran Iraq Israel Jordan Kuwait Senegal Sierra Leone Somalia South Africa Sudan Swaziland Tanzania Togo Tunisia Uganda Zambia Zimbabwe
AFRICA (44)
Algeria Angola Benin Botswana Burkina Faso Burundi Cameroon Cape Verde Central African Republic Chad Congo Eritrea Ethiopia Gabon Gambia
Ghana Gibraltar Guinea Ivory Coast Kenya Lesotho Liberia Libya Madagascar Malawi Mauritius Morocco Mozambique Namibia Niger Nigeria Rwanda
OCEANIA (10)
Australia Christmas Island Fiji Guam Micronesia, Federated New Zealand Papua New Guinea Samoa Solomon Islands Vanuatu
MISSION
To be a world class glove manufacturer providing top quality products with excellent services through continuous improvement and innovation.
Our business rules for the Company are:i) Do ii) Do iii) Do iv) Do not not not not lose lose lose lose your your your your shareholders money; health; temper; and customers. Tan Sri Dr. Lim, Wee-Chai Chairman
CORPORATE VALUES
Global customer satisfaction Do it right first time and every time Integrity and total commitment Excellence in quality and competitiveness Environmental friendly and social responsibilities
QUALITY POLICY
Quality and productivity are our business Continuous improvement and innovation are our duties Towards zero defect is our target
Contents
MALAYSIA
Page 1 2 3 4 5 6 7 8 13 14 15 Export Markets Vision and Mission Contents Corporate Structure
THAILAND
Page
CHINA
16 Chairmans Statement
(English, Bahasa Malaysia & Mandarin)
28 Top Glove Corporate Song 29 Corporate Governance Statement 36 Statement on Internal Control 37 Audit Committee Report 41 Financial Statements for the Year Ended 31 August 2007 100 List of Properties 104 Analysis of Shareholdings 107 Notice of AGM 111 Form of Proxy
International Quality Awards & Certifications Corporate Information Board of Directors Directors Profile Senior Management Team Six Year Group Financial Review Performance
Corporate Structure
100% Techniglove Asia Sdn Bhd : Malaysia
100% Top Glove Technology Sdn Bhd : Malaysia 100% Top Glove Technology (Thailand) Co Ltd : Thailand 100% Top Glove Medical (Thailand) Co Ltd : Thailand
100% TOP GLOVE SDN BHD 100% TG MEDICAL SDN BHD 100% TOP GLOVE ENGINEERING SDN BHD
1991 1994
SINCE
Corporate Information
BOARD OF DIRECTORS
Tan Sri Dr. Lim, Wee-Chai Chairman Tan Sri Datuk (Dr.) Arshad Bin Ayub Independent Non-Executive Director Puan Sri Tong Siew Bee Executive Director Lee Kim Meow Executive Director Lim Hooi Sin Executive Director Sekarajasekaran a/l Arasaratnam Independent Non-Executive Director Lau Boon Ann Non-Executive Director Quah Chin Chye Independent Non-Executive Director Lim Cheong Guan Executive Director
STOCK EXCHANGE LISTING Main Board of Bursa Malaysia Securities Berhad Stock Code : 7113 Stock Name : TOPGLOV American Depository Receipt (ADR), USA ADR Symbol : TGLVY PRINCIPAL BANKERS REGISTERED OFFICE Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Malaysia Tel : 603-2084 9000 Fax : 603-2094 9940 / 2095 0292 CORPORATE OFFICE Lot 4969, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3392 1992 / 1905 Fax : 603-3392 1291 / 8410 E-mails : (i) top@topglove.com.my (ii) tgmed@po.jaring.my (iii) topg@po.jaring.my Website : http://www.topglove.com.my COMPANY SECRETARY Chua Siew Chuan (MAICSA No: 0777689) REGISTRAR Securities Services (Holdings) Sdn Bhd Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Malaysia Tel : 603-2084 9000 Fax : 603-2094 9940 / 2095 0292 AUDITOR Ernst & Young Chartered Accountants, Lot 1, 6th Floor, Menara Pertam, Jalan BBP 2, Taman Batu Berendam Putra, Batu Berendam, 75350 Melaka, Malaysia HSBC Bank Malaysia Berhad Standard Chartered Bank Malaysia Berhad OCBC Bank (M) Berhad Public Bank Berhad Hong Leong Bank Berhad United Overseas Bank (Malaysia) Berhad Malayan Banking Berhad EON Bank Berhad KBC Bank N. V. Thai Military Bank Public Company Limited China Construction Bank SOLICITORS Cheang & Ariff 39 Court, 39, Jalan Yap Kwan Seng, 50450 Kuala Lumpur, Malaysia Soo Thien Ming & Nashrah No. 45-47, 1st Floor, Jalan Kapar, 41400 Klang, Selangor Darul Ehsan, Malaysia
Board of Directors
BOARD OF DIRECTORS
1. Tan Sri Dr. Lim, Wee-Chai Chairman 4. Lee Kim Meow Executive Director 7. Lau Boon Ann Non-Executive Director 8. Quah Chin Chye Independent Non-Executive Director
2. Tan Sri Datuk (Dr.) Arshad Bin Ayub 5. Lim Hooi Sin Executive Director Independent Non-Executive Director 3. Puan Sri Tong Siew Bee Executive Director
6. Sekarajasekaran a/l Arasaratnam 9. Lim Cheong Guan Executive Director Independent Non-Executive Director
Our Business Direction is: Consistently High Quality with Efcient Low Cost
Top Glove Corporation Berhad I Annual Report 2007
Directors Profile
Tan Sri Dr. Lim, Wee-Chai Chairman Aged 49, a Malaysian citizen, was appointed as the Chairman of Top Glove Corporation Bhd on 4 September 2000. He is also the founder of the Top Glove Group of Companies. The Group was established in 1991 and was listed on the Bursa Malaysia Securities Berhad on 27 March 2001. He obtained a Bachelor of Science Degree with Honours in Physics in 1982 from University Malaya and a Master of Business Administration in 1985 from Sul Ross State University in Texas, USA. He also earned his Doctorate in Business Administration from the Irish International University, London in 2001 and later was awarded with the Fellow Membership of the Business Management Association, UK in September 2001. Tan Sri Dr. Lim brings a wealth of experience in the marketing of consumers products whilst he was the Sales Manager of a subsidiary company of OYL Industries Bhd. In 1991, he set up Top Glove Sdn Bhd, his own glove manufacturing and trading business with only three (3) production lines and has expanded this business to be the Worlds Largest Rubber Glove Manufacturer with 322 production lines in eighteen (18) factories based in Malaysia, Thailand and China (as at August 2007). He has more than 20 years of experience in the rubber and latex manufacturing business. He served as the President (1997 to 1999) of the Malaysian Rubber Glove Manufacturers Association (MARGMA). Prior to this, he was also the Vice-President, Treasurer and Honorary Secretary for the past seven (7) years in this association. In 1998 and 1999, he was the Director of the Association of Malaysia Medical Industries (AMMI). In 1998 and 1999, he was also the Board member of the Malaysia Rubber Board. In 4 December 2004, Tan Sri Dr. Lim, Wee-Chai was named and awarded the highly prestigious accolade, Master and Country Entrepreneur of Malaysia for the Year 2004, by Messrs Ernst and Young. This award was presented by the Prime Minister of Malaysia, Y.A.B. Dato Seri Abdullah Bin Hj. Ahmad Badawi. With this award, Tan Sri Dr. Lim represented Malaysia in Monte Carlo, Monaco for the World Entrepreneur of The Year contest on 28 May 2005. On 2 June 2007, he was awarded the Darjah Kebesaran Panglima Setia Mahkota (P.S.M.) award which carries the title Tan Sri from Duli Yang Maha Mulia Seri Paduka Baginda Yang di-Pertuan Agong (The King of Malaysia). Tan Sri Dr. Lims business rules for the Company are: i) ii) iii) iv) Do not lose your shareholders money; Do not lose your health; Do not lose your temper; and Do not lose your customers. Tan Sri Dr. Lim, Wee-Chai is the spouse of Puan Sri Tong Siew Bee and the brother of Mr. Lim Hooi Sin, both are the Directors and Substantial Shareholders of the Company. He is also the brother of Ms. Lim Quee Choo, a Substantial Shareholder of the Company. He does not have any directorship in other public companies and has no conict of interest with the Company. He has not been convicted of any offences within the past ten (10) years other than trafc offences, if any.
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Lau Boon Ann Non-Executive Director Aged 52, a Malaysian citizen, was appointed as a Non-Executive Director of Top Glove Corporation Bhd on 4 September 2000. He achieved his Diploma in Administrative Management, Organization and Methods, and Diploma in Marketing in United Kingdom in 1980 and later pursues his Post Graduate Diploma in Management studies. He obtained his Master in Business Analysis degree in 1981 from Lancaster University, United Kingdom. He started his career as a Corporate Planner in 1981 and he was also involved in Management Consultancy and Marketing Manager for various property companies. In August 1988, he was instrumented in the setting up of Top Gloves Factory 1, which was subsequently leased to Top Glove Sdn. Bhd. He returned to serve as an Assistant General Manager with Arab Malaysian Development Bhd. from 1990 to 1996 and is presently involved in the real estate and property development sector. Lau Boon Ann does not have any family relationship with any Director and/or Substantial Shareholder of the Company and has no conict of interest with the Company. He does not have any directorships in other public companies and has not been convicted of any offences within the past ten (10) years other than trafc offences, if any.
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1. Tan Sri Dr. Lim, Wee-Chai 2. Puan Sri Tong Siew Bee 3. David Lim 4. KM Lee 5. Lim Cheong Guan 6. Wu Kin Yeap 7. Chookiad Usaha 8. Hue Kon Fah
9. Jeremy Liew 10. Jeff Lee 11. Noraziah Mahmud 12. Philip Thomas 13. Lim Wee Meng 14. Ken Soo 15. Danny Ong 16. Nagappen s/o Kumarasamy
17. Puon Tuck Seng 18. Audie Seow 19. Manmeet Singh 20. Lew Sin Chiang
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The Group continued to achieve another year of remarkable net prot growth of 32% to RM103.8 million, from RM78.4 million in 2006...
Group Turnover Earning Before Interest, Depreciation & Taxation Prot Before Taxation Taxation Prot Attributable to Equity Holders Net Assets Earnings Per Share (RM) Gross Dividend Rate (%) Number of Shares in Issue Par Value of Ordinary Share (RM) Net Assets Per Share (RM) Share Price (RM) Market Capitalisation (at 31 August) 31.8.02 (RM000) 180,202 27,058 20,186 4,170 16,102 107,548 0.25 6.00 65,000 1.00 1.65 2.21 143,650 31.8.03 (RM000) 265,089 39,455 29,264 5,457 23,349 135,026 0.26 12.00 92,197 1.00 1.48 3.96 365,100 31.8.04 (RM000) 418,133 60,638 45,190 5,848 38,932 155,017 0.42 14.00 93,059 1.00 1.67 7.25 674,678 31.8.05 (RM000) 641,827 89,191 65,745 12,262 53,447 203,692 0.29 16.00 188,639 0.50 1.09 4.92 928,104 31.8.06 (RM000) 992,611 130,310 91,773 12,712 78,392 284,109 0.41 18.00 192,285 0.50 1.49 8.65 1,663,265 31.8.07 (RM000) 1,228,778 175,651 118,644 15,757 103,795 637,138 0.36 20.00 300,476 0.50 2.12 6.95 2,088,308
(i) During the FY 2006, the Group change its accounting policy in compliance with MASB 25. The comparative amount from FY 2001 to FY 2005 have been restated. (ii) Subdivision of shares from one ordinary share of RM1.00 to two ordinary shares of RM0.50 each which was completed in February 2005. (iii) Issuance of bonus shares of 30% in FY2002, 40% in FY2003 and 40% in FY2007.
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Performance
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Chairmans Statement
Tan Sri Dr. Lim, Wee-Chai Chairman of Top Glove Corporation Berhad
Our business philosophies for the Company are:1 We work for our CUSTOMERS; 2 We take care of the interest of our SHAREHOLDERS; 3 We ensure that our EMPLOYEES continue to contribute positively to the Company and we take good care of the well-being of our employees; and 4 We work closely with our BANKERS, SUPPLIERS, BUSINESS ASSOCIATES and FRIENDS.
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Top Glove Corporation Berhad I Annual Report 2007
+24%
2006 2007 2006
+24%
2007
Net Prot
+32%
2006 2007 2006
+124%
2007
RM78.4 million
RM284 million
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COOPERATION & TEAM WORK At Top Glove, we have always stressed on the importance of teamwork within the organization as this will enable us to spearhead our objectives and overcome obstacles along the way. Strategic planning and distribution of responsibilities to all team members will ensure that work load is distributed evenly. By having these structured programmes, it will enable all team members to achieve their respective targets. With a strong work force of 8,300 from factory workers right up to the management staff in various departments, it is important to stress on teamwork if we are to meet the demands of our more than 800 customers worldwide. Each and every individual in the company plays an important role in meeting the targets and directions set. This strong will and determination are pre-requisites to bring the Group to a higher level of success. I strongly believe that the good co-operation and teamwork among our staff at all levels, together with good knowledge and experience as well as their own individual specialty will further encourage the distribution of good knowledge at all levels. This learning cycle will increase the efciency of our operations and improve productivity at a minimal cost via the adoption of new technology in our operational areas. I believe that improvement in these areas will be benecial for both the short and long term goals of the Company. FINANCIAL PERFORMANCE The Top Glove Group continued to achieve another year of remarkable revenue growth of 24% to RM1,228.9 million for the nancial year ended 31 August 2007 against RM992.6 million recorded in the previous nancial year. The growth was mainly attributed to the continued increase in customer base globally, higher volume of sales contributed by the increased capacity, as well as, to our continued ability to pass on the increase in operating cost. Against this backdrop, the Group continued to turn in record prots for year 2007. Pre-tax prot registered of RM118.6 million represented an increase of 29% over the previous record pre-tax prot of RM91.8 million achieved in 2006, whilst net profit grew by 32% year-on-year to RM103.8 million from RM78.4 million achieved in 2006. Earnings per share rose to 36.16 sen from 29.21 sen in 2006. Total assets of the Top Glove Group increased from RM762.1 million as at August 2006 to RM1,053.3 million in August 2007, an increase of 38%, a reection of the Group increase in asset base. In line with the strong nancial performance for the year, net assets also rose by 124% to RM637.2 million from RM284.1 million. DIVIDENDS In line with the favorable results, the Board of Directors is pleased to recommend a final dividend of 6% (tax exempt) amounting approximately RM9.0 million and a 6% (with tax 26%) amounting to approximately RM6.7 million for the nancial year ended 31 August 2007. The proposed nal dividend is subject to the shareholders approval in the forthcoming Ninth Annual General Meeting. The company had on 4 July 2007 declared an interim dividend of 8.0% (tax exempt) amounting to RM12 million in conjunction with the third quarter ended 31 May 2007 financial results announcement. Payment of the interim dividend was made on 13 September 2007.
Top Glove Corporation Berhad I Annual Report 2007
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Kenyataan Pengerusi
Pertumbuhan yang kukuh dan prestasi cemerlang Top Glove adalah lahir dari hasil semangat berpasukan yang jitu, pendekatan perniagaan yang bijaksana dan tumpuan berterusan kepada perniagaan kami agar ia bergerak maju ke arah yang betul. Saya dengan sukacitanya membentangkan kepada anda Kenyataan Pengerusi Kumpulan bagi tahun kewangan 2007.
Tahun 2007 merupakan tahun keenam Top Glove disenaraikan di Papan Utama Bursa Malaysia Securities Berhad dan kami berasa sungguh bangga untuk berkongsi dengan anda keputusan yang cemerlang. Kami ingin mengucapkan terima kasih khas kepada 800 pelanggan yang beroperasi di lebih 180 buah negara, kepada para pemegang saham kami yang tidak ternilai, kepada kakitangan kami, kepada rakan perniagaan, pembekal, ahli bank dan kawan kami di seluruh dunia. Pertumbuhan yang kukuh dan prestasi cemerlang Top Glove adalah lahir dari hasil semangat berpasukan yang jitu, pendekatan perniagaan yang bijaksana dan tumpuan berterusan kepada perniagaan kami agar ia bergerak maju ke arah yang betul. Sehingga 31 Ogos 2007, Top Glove mempunyai 18 buah kilang yang disokong oleh 322 mesin pengeluaran yang cekap dan canggih dalam mengeluarkan lebih kurang 28 bilion helai sarung tangan berkualiti setiap tahun. Angkaangka ini masih meningkat oleh kerana kami menjangkakan pertumbuhan yang memberangsangkan dalam permintaan perniagaan sarung tangan getah dalam pasaran dunia. Untuk memenuhi permintaan kukuh bagi sarung tangan kami, peningkatan aktif dalam kapasiti pengeluaran dan melaksanakan kawalan operasi yang ketat dalam mengeluarkan sarung tangan yang berkualiti tinggi secara konsisten telah dijalankan. Tahun 2007 ini merupakan satu lagi tahun yang penuh dengan cabaran apabila ianya melibatkan peningkatan harga kos bahan mentah seperti harga lateks mentah, bahan api, dan peningkatan nilai Ringgit Malaysia, Baht Thailand, dan Renminbi China berbanding dengan nilai Dolar Amerika Syarikat. Namun demikian, dengan adanya strategi perniagaan yang sempurna serta usaha bersatu daripada semua pihak, kami telah berjaya mengatasi segala cabaran dan mencapai prestasi cemerlang dalam keadaan tersebut. Di samping itu, langkah-langkah dan daya usaha bagi mengurangkan kos yang berkesan telah diambil untuk mempertingkatkan tahap kepuasan pelanggan. Dalam usaha meningkatkan kawalan terhadap harga lateks yang sentiasa turun naik, berkemungkinan besar Kumpulan akan mengambil alih dan melibatkan diri dalam sektor perladangan khususnya ladang getah. Selaras dengan keperihatinan terhadap kepentingan para pelanggan, kami telah melaksanakan amalan Pengurusan Hubung-Baik Pelanggan (Customer Relationship Management). Oleh itu, bahagian Pemasaran telah berjaya bekerjasama rapat dengan semua pelanggan di seluruh dunia untuk berkongsi kos pembuatan yang kian meningkat. Kami berjaya menyakinkan mereka dalam menerima harga sarung tangan yang lebih tinggi. Namun demikian, apabila harga bahan mentah menurun, kami akan berkongsi faedah ini dengan mereka melalui penawaran harga yang lebih saingan agar kedua-dua pihak dapat mencapai manfaat dan keadaan yang saling menguntungkan. Malah, kami juga telah menetapkan sasaran untuk dicapai oleh syarikat dan memastikan kami dapat mengekalkan keyakinan para pemegang saham yang diamanahkan kepada Lembaga Pengarah untuk memperkembangkan syarikat dan mencapai kejayaan dari tahun ke tahun. Dalam arena perniagaan sedunia yang penuh saingan hari ini, cabaran perniagaan memang tidak dapat dielakkan. Namun demikian, saya dengan gembiranya ingin menyatakan di sini bahawa pasukan pengurusan kami yang profesional dan penuh dedikasi sentiasa berusaha untuk memastikan operasi harian berjalan dengan lancar, peningkatan mutu kerja dan berusaha ke arah keadaan silap sifar dengan pengambilan langkah-langkah yang membawa pembaharuan secara menyeluruh serta berkesan demi mengatasi berbagai cabaran dan halangan.
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Dengan keberkesanan aktiviti berpasukan di pelbagai jabatan di Top Glove, kami dapat membina dan memperkukuhkan kedudukan di pasaran yang berbeza. Kami percaya bahawa langkah ini bukan sahaja telah memperkuatkan lagi kedudukan, tetapi juga membolehkan kami mengambil kesempatan sepenuhnya terhadap mana-mana keadaan pasaran yang menguntungkan. Dengan mengoptimumkan bidang-bidang tersebut kami dapat memperolehi sumber yang mencukupi untuk mengatasi pelbagai cabaran luar. Di samping itu, kami telah mengekalkan suasana kerja yang baik bagi para pekerja yang juga turut membantu dalam penyediaan untuk mencapai kadar pertumbuhan pada masa depan. Usaha Penyelidikan dan Pembangunan yang berterusan ini telah mengekalkan kedudukan kami yang penuh saingan menerusi kaedah pengeluaran inovatif dan langkah keberkesanan kos untuk pengeluaran sarung tangan yang berkualiti bagi memenuhi permintaan pelanggan-pelanggan kami. TINJAUAN MENYELURUH OPERASI Tumpuan berterusan untuk mencapai pertumbuhan yang kukuh telah membolehkan kami mencapai kedudukan sebagai Pengeluar Sarung Tangan Getah Terbesar di Dunia. Kini kami memiliki 16 buah kilang sarung tangan yang terletak di lokasilokasi strategik di Malaysia, Thailand dan China dengan kapasiti pengeluaran lebih kurang 28 bilion helai sarung tangan setiap tahun (dan terus meningkat) melalui 322 mesin pengeluaran yang canggih dan amat berkesan. Selain itu, kami mempunyai 2 lagi loji lateks pekat yang mempunyai kapasiti pengeluaran untuk mengeluarkan 90,000 tan metrik lateks basah setahun dan ini dijangka menyumbang kepada kira-kira 80 peratus lateks pekat bagi keperluan dan penggunaan dalaman Kumpulan. Kami akan terus berusaha mencapai prestasi cemerlang dengan perancangan strategi yang teliti dan inovasi berterusan dalam usaha mempertingkatkan kualiti, proses pengeluaran, rangkaian serta piawaian barangan. Dengan selesainya pengambilalihan Medi-Flex Limited (Medi-Flex) pada Mac 2007, kami sedang giat berusaha untuk memulihkan kedudukan Medi-Flex dalam tempoh yang sesingkat mungkin. Setakat ini, Medi-Flex telah berjaya memperbaiki kedudukannya dengan ketara setelah menggunakan tatacara operasi dan amalan perniagaan Top Glove. Pasukan petugas telah ditubuhkan di semua peringkat dan jabatan untuk memastikan syarikat dapat mencapai matlamat yang ditetapkan. Malah kami telah memberi tumpuan semula kepada kekuatan dan kelebihan Medi-Flex dalam teknologi pengeluaran sarung tangan bilik bersih (clean room gloves) dan kepakaran lain. Selain dari itu, kami menganggap bahawa pengambilalihan syarikat ini sesuai dengan struktur kumpulan demi meningkatkan imej Top Glove sebagai Satu Pusat Sumber Sarung Tangan Komprehensif bagi pelanggan pelanggan yang sedia ada dan juga pelanggan pelanggan baru pada masa yang akan datang. Saya dengan sukacitanya ingin berkongsi dengan anda bahawa melalui teknologi dan keperisian automatik, kami dapat menghasilkan sarung tangan berkualiti dengan kos yang lebih berkesan. Kilang-kilang kami kini dilengkapi dengan mesin pengeluaran yang berdaya saing, cekap dan direka untuk beroperasi dengan lebih laju dan mantap dalam penghasilan sarung tangan yang berkualiti. Saya percaya dengan kawalan yang sempurna, Kumpulan akan dapat menguasai bahagian pasaran yang lebih luas pada masa yang akan datang. Sehubungan dengan ini syarikat penuh yakin dengan pertumbuhan yang berterusan menerusi usaha berpanjangan seperti aktiviti pemasaran yang agresif dan langkah kawalan kos dan kualiti yang lebih ketat dan bermutu. Kejayaan menyeluruh syarikat adalah berdasarkan beberapa prinsip perniagaan mudah yang telah dilaksanakan secara strategik untuk mencapai tahap kefahaman yang lebih baik tentang pasaran. Prinsip perniagaan yang dilaksanakan di semua peringkat dan kilang adalah seperti berikut: 1. 2. 3. 4. Tidak mendatangkan kerugian kepada para pemegang saham; Lebih menitikberatkan kesihatan badan anda; Tidak mudah hilang sabar; dan Tidak kehilangan pelanggan.
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Di Top Glove, kami sentiasa menekankan peri pentingnya semangat berpasukan di dalam organisasi kerana ini akan membolehkan pencapaian matlamat dan mengatasi segala halangan yang dihadapi. Perancangan strategik dan pengagihan tanggungjawab kepada seluruh anggota pasukan akan memastikan beban kerja dipikul secara rata. Program berstruktur tersebut akan memastikan keseluruhan anggota pasukan dapat mencapai matlamat masing-masing. Dengan jumlah pekerja sebanyak 8,300 orang yang terdiri dari pekerja kilang sehingga kakitangan pengurusan dalam berbagai jabatan, adalah penting bagi kami menegaskan semangat berpasukan dalam memenuhi permintaan lebih 800 pelanggan di seluruh dunia. Setiap individu di dalam syarikat memainkan peranan penting dalam memenuhi sasaran dan arah yang telah ditetapkan. Hasrat dan keazaman yang kuat ini adalah prasyarat untuk membawa Kumpulan ke tahap kejayaan yang lebih tinggi. Saya percaya bahawa kerjasama dan semangat berpasukan di antara kakitangan kami di semua peringkat, bersama-sama dengan pengetahuan dan pengalaman yang meluas, serta kepakaran setiap individu akan menggalakan kakitangan berkongsi pengetahuan di semua peringkat. Proses pembelajaran ini akan meningkatkan kecekapan operasi kami dan memperbaiki produktiviti dengan kos yang minimum menerusi penggunaan teknologi baru di dalam bidang operasi. Saya percaya bahawa pembaikan dalam bidang-bidang tersebut akan memanfaatkan matlamat jangka pendek dan jangka panjang Syarikat. PENCAPAIAN KEWANGAN Kumpulan Top Glove terus mencapai satu lagi tahun pertumbuhan hasil yang luar biasa sebanyak 24% kepada RM1,228.9 juta bagi tahun kewangan berakhir 31 Ogos 2007 berbanding dengan RM992.6 juta yang dicatatkan pada tahun kewangan lalu. Sebahagian besar pertumbuhan tersebut disebabkan pertambahan jumlah pelanggan yang berterusan di seluruh dunia serta jumlah jualan yang lebih tinggi hasil daripada peningkatan kapasiti pengeluaran serta keupayaan kami untuk memindah kenaikan kos operasi. Dalam keadaan tersebut, Kumpulan terus mencapai rekod baru dalam keuntungan bagi tahun 2007. Keuntungan sebelum cukai berjumlah RM118.6 juta atau peningkatan sebanyak 29% berbanding dengan keuntungan sebelum cukai pada tahun lepas yang berjumlah RM91.8 juta yang tercapai pada tahun 2006, manakala keuntungan bersih bertambah sebanyak 32% dari tahun ke tahun kepada RM103.8 juta dari RM78.4 juta yang tercapai pada tahun 2006. Perolehan sesaham meningkat kepada 36.16 sen dari 29.21 sen pada tahun 2006. Jumlah aset Kumpulan Top Glove meningkat dari RM762.1 juta pada Ogos 2006 kepada RM1,053.3 juta pada Ogos 2007, dengan kenaikan 38% yang mencerminkan peningkatan asas aset Kumpulan. Serentak dengan pencapaian kewangan yang kukuh pada tahun ini, jumlah aset bersih turut meningkat sebanyak 124% kepada RM637.2 juta dari RM284.1 juta. DIVIDEN Memandangkan keputusan yang menggalakkan, Lembaga Pengarah dengan sukacitanya mencadangkan pembayaran dividen akhir sebanyak 6% (tanpa cukai) berjumlah lebih kurang RM9.0 juta dan 6% (dengan cukai 28%) berjumlah lebih kurang RM6.7 juta bagi tahun kewangan berakhir 31 Ogos 2007. Cadangan dividen akhir tertakluk kepada kelulusan pemegang saham di Mesyuarat Agung Tahunan Kesembilan yang akan datang. Pada 4 Julai 2007, syarikat telah mengumumkan dividen interim sebanyak 8.0% (tanpa cukai) berjumlah RM12 juta sempena dengan pengumuman keputusan kewangan suku ketiga yang berakhir 31 Mei 2007. Dividen interim tersebut telah dibayar pada 13 September 2007. Oleh itu, bagi tahun kewangan yang sepenuhnya, dan tertakluk kepada kelulusan pemegang saham untuk dividen akhir yang dicadangkan, maka bersama-sama dividen interim yang telah diumumkan dan dibayar, jumlah dividen bagi tahun kewangan berakhir 31 Ogos 2007 ialah 20% berbanding dengan jumlah dividen sebanyak 18% bagi tahun kewangan berakhir 31 Ogos 2006. Ini merupakan peningkatan sebanyak 2% dalam pembayaran dividen kasar. Jumlah dividen yang dicadangkan/dibayar merupakan pengagihan kepada pemegang saham sebanyak 27% daripada keuntungan bersih Kumpulan bagi tahun kewangan ini.
Top Glove Corporation Berhad I Annual Report 2007
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Top Glove telah melaksanakan pelbagai rancangan perkembangan sejak disenaraikan pada tahun 2001 untuk memenuhi peningkatan permintaan penggunaan sarung tangan getah di seluruh dunia yang sehingga kini berjumlah 123 bilion setahun. Jumlah ini masih terus meningkat dengan kadar pertumbuhan di antara 10 hingga 12 peratus setiap tahun. Kami telah merancang projek-projek yang akan membolehkan peningkatan bahagian pasaran kepada sasaran yang dirancang iaitu, sebanyak 25% menjelang Disember 2007. Untuk mencapai sasaran tersebut, kami akan menumpukan perhatian kepada latihan sumber manusia dan mempertingkatkan proses pembuatan sarung tangan. Kumpulan telah menekankan untuk meningkatkan piawaian kami, khasnya dalam Amalan Baik Pengilang (Good Manufacturing Practice) serta projek Penyelidikan dan Pembangunan yang menyeluruh secara dalaman dan luaran. Segala langkah tersebut telah dilaksanakan secara teliti untuk menjangkakan pertumbuhan dan permintaan yang kukuh dan berterusan bagi produk baru kami di dalam pasaran dunia. Memandangkan tahap piawaian kesihatan yang semakin ketat serta kesedaran yang kian meningkat di seluruh dunia, Top Glove memainkan peranannya sebagai pengeluar sarung tangan berkualiti tinggi untuk membantu melindungi dan mempertingkatkan lagi jangka hayat manusia. Tumpuan kami adalah untuk bekerjasama dengan pihak-pihak luar, khususnya agensi-agensi kerajaan demi memperbaiki proses pengeluaran dan pembuatan agar kami dapat memenuhi keberkesanan kos yang disasarkan. Di antara produk terbaru kami ialah apron dan sarung tangan polietilena (polyethylene) yang digunakan secara meluas dalam bidang-bidang bukan perubatan. Usaha promosi gigih telah dijalankan dengan menyertai pameran perdagangan perubatan dan bukan perubatan untuk menembusi kedua-dua segmen pasaran sarung tangan ini. Penyertaan pameran dan sasaran baru telah dikenal pasti untuk membolehkan pasukan pemasaran kami membuka pasaran khusus yang mempunyai potensi besar demi menambah penggunaan sarung tangan. Meninjau ke arah masa depan, kami juga sedang memperkembangkan rangkaian kami secara agresif ke Eropah Timur. Setelah menganggotai Kesatuan Eropah, piawaian kesihatan di Eropah Timur turut dipertingkatkan demi mematuhi piawaian kesihatan Eropah yang tinggi. Negara-negara dari Latin Amerika juga terus menambah penggunaan sarung tangan oleh kerana keperluan yang meningkat dari tahap kesedaran kesihatan yang lebih tinggi dan kemunculan penyakit baru. PENGHARGAAN Saya ingin mengambil kesempatan ini untuk menyampaikan penghargaan dan ucapan terima kasih yang ikhlas dan tidak terhingga kepada seluruh pemegang saham kerana memberi peluang kepada kami untuk bekerjasama, serta mengekalkan kepercayaan, sokongan dan keyakinan dalam menjalin hubungan baik dengan pelbagai pihak. Kepada rakan perniagaan, pelanggan, pembekal, ahli bank, pakar analisis perniagaan dan pengurus dana, kami ingin mengucapkan terima kasih atas sumbangan dan inisiatif anda yang telah membolehkan kami menjadikan tahun 2007 sebagai satu lagi tahun yang berjaya bagi kami semua. Saya juga ingin mengucapkan terima kasih kepada pihak pengurusan dan kakitangan Kumpulan Top Glove yang telah memainkan peranan penting dalam menyumbang kepada perkembangan syarikat yang berterusan . Akhir sekali, saya ingin mengucapkan terima kasih kepada semua pihak yang telah menyokong Top Glove dalam segala usaha perniagaan dan kami amat yakin untuk terus berkembang pesat demi mengekalkan kedudukan sebagai Pengeluar Sarung Tangan Getah Terbesar Di Dunia.
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25
, , , 8,300, , 800 , , , , , , ,
2007831 , 24%RM12 2890, RM99260 , , 2007 RM11186, 2006 RM918029%, , 32%, 2006RM7840RM1 380200636.1629.21 20068RM76210, 20078RM105330, 38%, , 124%, RM63720RM28410
26
, 20078316%(), RM9006%(26%), RM670 920077420075313 , 8.0%(), RM12002007913 , , , , 2007 83120%, 200683118% 2%/200727%
, , 2007, , ,
20071112
27
BAHASA MALAYSIA
Dari mulanya, hingga terkini, Top Glove nama diberi, Pengeluar sarung tangan yang berkualiti, Yakinlah hasil pengeluaran kami, Yang bermutu dan berkualiti tinggi, Sentiasa menuju kejayaan, Untuk mencapai keunggulan.
MANDARIN
THAI
Tour loak yom rub - wah rao nan kheu, Phoo num darn tungmue - teee - prom - lae khun na parb dee, Rao sang sarn - rao terb toh - rao man khong, Pur kao pai - soo sakon - doay mue rao, Top Glove dee kwa krai, Rao tum ngarn doay jai, Khun na parb dee - lae bor ri karn tee dee, Pur kwarm wai wang jai, rao yin dee rub chai, Top Glove nan ngai - khun na parb tong tee nee
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All of the above meetings were held in the Companys Conference Room at Lot 4969, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang, Selangor Darul Ehsan, Malaysia.
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The duties and responsibilities of the Nomination Committee are as follows: To recommend to the Board of Directors, candidates for all directorships to be lled by the Shareholders or the Board of Directors; To consider, in making its recommendations, candidates for directorships proposed by the Managing Director and, within the bounds of practicability, by any other senior executive or any Director or Shareholder; To recommend to the Board of Directors the nominees to ll the seats on Board Committees; To assess the effectiveness of the Board of Directors as a whole and each individual Directors/Committees of the Board; To act in line with the directions of the Board of Directors; and To consider and examine such other matters as the Nomination Committee considers appropriate.
REMUNERATION COMMITTEE This Committee was established on 7 November 2001. The terms of reference of the Remuneration Committee was reviewed by the Board and all the members of the Remuneration Committee were re-nominated and re-appointed on 4 September 2007. The terms of ofce of this Committee is two (2) years and may be re-nominated and re-appointed by the Board. Its role is to assist the Board of Directors in their responsibilities in assessing the remuneration packages of the executive Directors. The members of the Remuneration Committee are as follows: (a) (b) (c) Tan Sri Dr. Lim, Wee-Chai Sekarajasekaran a/l Arasaratnam Lau Boon Ann (Chairman/Managing Director) - Chairman (Independent Non-Executive Director) (Non-Executive Director)
The duties and responsibilities of the Remuneration Committee are as follows: To review and assess the remuneration packages of the executive Directors in all forms, with or without other independent professional advice or other outside advice; To ensure the levels of remuneration be sufciently attractive and be able to retain Directors needed to run the Company successfully; To structure the component parts of remuneration so as to link rewards to corporate and individual performance and to assess the needs of the Company for talent at Board level at a particular time; To recommend to the Board of Directors the remuneration packages of the executive Directors; To act in line with the directions of the Board of Directors; and To consider and examine such other matters as the Remuneration Committee considers appropriate.
Top Glove Corporation Berhad I Annual Report 2007
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Directors remuneration are broadly categorized into the following bands: Number of Directors Range of Remuneration Below RM50,000 RM150,001 to RM200,000 RM200,001 to RM250,000 RM250,001 to RM300,000 RM300,001 to RM350,000 RM550,001 to RM600,000 RM1,650,001 to RM1,700,000 Executive 1 1 1 1 1 Non-Executive 4 -
Details of individual Directors Remuneration are not disclosed in this report as the Board has consider that the above Directors Remuneration disclosures by band and analysis between executive and non-executive Directors satises the accountability and transparency aspects of the Code. ESOS OPTION COMMITTEE The Company, with approval of the Shareholders during its Extraordinary General Meeting (EGM) held on 9 January 2003, has implemented the ESOS (Employees Share Option Scheme) ofcially on 29 April 2003. An ESOS Option Committee was appointed by the Board on 11 April 2003 to oversee the administration as well as to ensure proper implementation of the ESOS according to the Bye-laws of the scheme. Currently the ESOS Option Committee comprises the following members: Tan Sri Dr. Lim, Wee-Chai - Chairman Lee Kim Meow - member Lim Cheong Guan - member Wu Kin Yeap - member (appointed on 7 September 2007) Hue Kon Fah - member (appointed on 7 September 2007) Ngian Yoke Fung - member (appointed on 7 September 2007) Chee Ban Tuck - member (resigned on 7 September 2007)
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Other than the above, there were no issuance of warrants or convertible securities during the nancial year. 12. Revaluation of Landed Properties The Company does not have a revaluation policy on landed properties.
Top Glove Corporation Berhad I Annual Report 2007
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3) 4)
5) 6) 7) 8) 9)
The Companys business direction is consistently high quality and efciently low cost and hence, the Board will remains committed towards operating a sound system of internal control and therefore recognises that the system must continuously evolve to support the business and size of operations of the Group. There were no material internal control failures, which resulted in material losses or contingencies during the nancial year. The Management will, when necessary, put in place appropriate action to further enhance the Groups system of internal control. This statement does not include the state of internal control in associate company, which has not been dealt with as part of the Group. This statement is made in accordance with a resolution of the Board of Directors dated 19 October 2007.
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Note: * In compliance with the revised Code of Corporate Governance which took effect on 1 October 2007, Tan Sri Dr. Lim, Wee-Chai resigned on 17 October 2007. 2. COMPOSITION AND TERMS OF REFERENCE 2.1 Composition of members The Board shall elect the Audit Committee members from amongst themselves, comprising no fewer than three (3) Directors, where the majority shall be Independent Directors. The term of ofce of the Audit Committee is two (2) years and may be renominated and appointed by the Board of Directors. In this respect, the Board adopts the denition of Independent Director as dened under the Listing Requirements of Bursa Malaysia Securities Berhad (Bursa Securities). At least one (1) member of the Audit Committee must be: a) b) a member of the Malaysian Institute of Accountant (MIA); or if he is not a member of MIA, he must have at least 3 years of working experience; and i) ii) c) he must have passed the examinations specied in Part I of the First Schedule of the Accountants Act 1967; or he must be a member of one of the associations of the accountants specied in Part II of the First Schedule of the Accountants Act 1967; or
No alternate Director of the Board shall be appointed as a member of the Audit Committee. Retirement and resignation If a member of the Audit Committee resigns, dies, or for any reason ceases to be a member with the result that the number of members is reduced below three (3), the Board shall within three (3) months of the event appoint such number of the new members as may be required to ll the vacancy.
Top Glove Corporation Berhad I Annual Report 2007
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2.8 Authority The Audit Committee shall, in accordance with a procedure to be determined by the Board of Directors and at the expense of the Company: a) b) authorise to investigate any activity within its terms of reference. All employees shall be directed to co-operate as requested by members of the Audit Committee; have full and unlimited/unrestricted access to all information and documents/resources which are required to perform its duties as well as to the internal and external auditors and senior management of the Company and Group; obtain, at the expense of the Company, other independent professional advice or other advice and to secure the attendance of outsiders with relevant experience and expertise if it considers necessary; be able to convene meetings with the external auditors, without the attendance of the executive members of the Audit Committee, whenever deemed necessary; and be able to make relevant reports when necessary to the relevant authorities if a breach of the LR of Bursa Securities occurred.
c) d) e)
2.9 Duties and responsibilities The duties and responsibilities of the Audit Committee are as follows: a) b) c) d) e) f) g) h) To review the maintenance and control of an effective accounting system; To review the Groups public accountability and compliance with the law; To ensure adequacy of internal and external audit procedures; To evaluate the quality of external auditors and make recommendations concerning their appointment and remuneration and to consider the nomination of a person or persons as external auditors; To provide liaison between the external auditors, the management and the Board of Directors and also to review the assistance given by the management to the external auditors; To review the ndings of the internal and external auditors; To review the quarterly results and nancial statements and annual report prior to submission to the Board of Directors; To monitor any related party transactions that may arise within the Group and to report, if any, transactions between the Group and any related party outside the Group, which are not based on arms-length terms and on terms which are disadvantageous to the Group; To report its ndings on the nancial and management performance, and other material matters to the Board of Directors; To verify the allocation of Employees Share Option Scheme (ESOS) in compliance with the criteria as stipulated in the Bye-Laws of ESOS of the Company, if any; To act in line with the directions of the Board of Directors; and To consider and examine such other matters as the Audit Committee considers appropriate.
i) j) k) l)
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4.
SUMMARY OF ACTIVITIES OF THE INTERNAL AUDIT DEPARTMENT The Company has an Internal Audit Department whose principal objective is to undertake regular reviews of the systems of controls, procedures and operations so as to provide reasonable assurance that the internal control system is sound, adequate and satisfactory. The Internal Audit Department reports direct to the Audit Committee. Its role is to provide the Committee with independent and objective reports on the state of internal controls of the operating units within the Group and the extent of compliance by such units with the Groups established policies and procedures and the regulatory requirements of the relevant authorities. The Audit Committee reviews and approves the internal audit plan of the Group submitted by the Internal Audit Manager. During the nancial year ended 31 August 2007, the areas audited included audits of the various departments covering all the factories and subsidiaries within the Group. Internal audit reports were issued to the Audit Committee regularly and tabled in the Audit Committee meetings. The reports are also issued to the respective operations management, incorporating audit recommendations and management responses with regards to any audit ndings on the weaknesses in the systems and controls of the operations. The Internal Audit Department also follows up with management on the implementation of the agreed audit recommendations.
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Financial Statements
for the Year Ended 31 August 2007
Page Directors Report 42 Statement by Directors 47 Statutory Declaration 47 Report of the Auditors 48 Income Statements 49 Balance Sheets 50 Statements of Changes in Equity 52 Cash Flow Statements 54 Notes to the Financial Statements 56
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Directors Report
The directors have pleasure in presenting their report together with the audited nancial statements of the Group and of the Company for the nancial year ended 31 August 2007. PRINCIPAL ACTIVITIES The principal activities of the Company are investment holding and the provision of management services. The principal activities of the subsidiaries are described in Note 12 to the nancial statements. There have been no signicant changes in the nature of the principal activities during the nancial year. RESULTS Group RM000 Prot for the year Attributable to: Equity holders of the Company Minority interests 102,887 103,795 (908) 102,887 Company RM000 11,948 11,948 11,948
There were no material transfers to or from reserves or provisions during the nancial year other than as disclosed in the nancial statements. In the opinion of the directors, the results of the operations of the Group and of the Company during the nancial year were not substantially affected by any item, transaction or event of a material and unusual nature other than as dislosed in Note 2.3 to the nancial statements. DIVIDENDS The amount of dividends paid by the Company since 31 August 2006 were as follows: RM000 In respect of the nancial year ended 31 August 2006: Interim tax exempt dividend of 7%, paid on 15 September 2006 Final tax exempt dividend of 6%, paid on 15 March 2007 Final dividend of 5% less 27% taxation, paid on 15 March 2007 6,727 8,982 5,464 21,173 In respect of the nancial year ended 31 August 2007: Interim tax exempt dividend of 8%, paid on 13 September 2007 12,013
At the forthcoming Annual General Meeting, a nal tax exempt dividend of 6% on 300,479,831 ordinary shares amounting to RM9,014,395 (3 sen per share) and a nal dividend of 6% less 26% taxation amounting to RM6,670,652 (2.22 sen per share) in respect of the nancial year ended 31 August 2007 will be proposed for shareholders approval. The nancial statements for the current nancial year do not reflect this proposed dividend. Such dividend, if approved by the shareholders, will be accounted for in equity as an appropriation of retained earnings in the nancial year ending 31 August 2008.
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4,597,874 (6,380,000) 112,628,847 7,105,181 (6,380,000) 110,121,540 (2,910,000) 9,099,169 274,960 (20,000) 813,016
Number of Options over Ordinary Shares of RM0.50 Each Balance 1 September prior to 2006 Granted Exercised bonus issue* Tan Sri Dr. Lim, Wee-Chai Puan Sri Tong Siew Bee Lim Hooi Sin Lee Kim Meow Lim Cheong Guan 252,000 384,000 96,000 304,000 40,000 (252,000) (272,000) 112,000 96,000 304,000 40,000
Number of Options over Ordinary Shares of RM0.50 Each Balance after 31 August bonus issue* Granted Exercised 2007 Tan Sri Dr. Lim, Wee-Chai Puan Sri Tong Siew Bee Lim Hooi Sin Lee Kim Meow Lim Cheong Guan 156,800 134,400 425,600 56,000 806,400 112,000 403,200 (134,400) (112,000) 806,400 268,800 403,200 313,600 56,000
* Bonus issue on the basis of two new ordinary shares for every ve existing ordinary shares. Tan Sri Dr. Lim, Wee-Chai, Puan Sri Tong Siew Bee and Lim Hooi Sin by virtue of their interest in shares of the Company are also deemed interested in shares of all the subsidiaries to the extent the Company has an interest. The other director in ofce at the end of the nancial year had no interest in shares in the Company or its related corporations or in share options in the Company during the nancial year.
44
(c)
Subsequent to the end of the nancial year up to the date of this report, the Company increased its issued and paid-up share capital from RM150,237,915 to RM150,255,765 by way of the issuance of 35,700 ordinary shares of RM0.50 each pursuant to the ESOS at an option price of between RM0.62 and RM10.49 per ordinary share. The new ordinary shares issued during the nancial year ranked pari passu in all respects with the existing ordinary shares of the Company. EMPLOYEE SHARE OPTIONS SCHEME The Companys ESOS is governed by the by-laws which was approved by the shareholders at the Extraordinary General Meeting held on 9 January 2003 and became effective on 29 April 2003. The main features and other terms of the ESOS are disclosed in Note 25 to the nancial statements. The Company has been granted exemption by the Companies Commission of Malaysia from having to disclose the names of employees who have been granted options to subscribe for less than 100,000 ordinary shares. The list of employees granted options to subscribe for 100,000 or more ordinary shares during the nancial year is disclosed in the section on Directors Interests in this report. OTHER STATUTORY INFORMATION (a) Before the income statements and balance sheets of the Group and of the Company were made out, the directors took reasonable steps: (i) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of provision for doubtful debts and satised themselves that all known bad debts had been written off and that adequate provision had been made for doubtful debts; and to ensure that any current assets which were unlikely to realise their value as shown in the accounting records in the ordinary course of business had been written down to an amount which they might be expected so to realise.
(ii) (b)
At the date of this report, the directors are not aware of any circumtances which would render: (i) (ii) the amount written off for bad debts or the amount of the provision for doubtful debts in the nancial statements of the Group and of the Company inadequate to any substantial extent; and the values attributed to the current assets in the nancial statements of the Group and of the Company misleading.
45
(d)
(e)
In the opinion of the directors: (i) no contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve months after the end of the nancial year which will or may affect the ability of the Group or of the Company to meet its obligations when they fall due; and no item, transaction or event of a material and unusual nature has arisen in the interval between the end of the nancial year and the date of this report which is likely to affect substantially the results of the operations of the Group or of the Company for the nancial year in which this report is made.
(ii)
SIGNIFICANT EVENT The signicant event is disclosed in Note 12 to the nancial statements. AUDITORS The auditors, Ernst & Young, have expressed their willingness to continue in ofce. Signed on behalf of the Board in accordance with a resolution of the directors dated 12 November 2007.
46
Statement by Directors
We, TAN SRI DR. LIM, WEE-CHAI and QUAH CHIN CHYE, being two of the directors of TOP GLOVE CORPORATION BHD., do hereby state that, in the opinion of the directors, the accompanying nancial statements set out on pages 49 to 99 are drawn up in accordance with the provisions of Companies Act, 1965 and applicable Financial Reporting Standards in Malaysia so as to give a true and fair view of the nancial position of the Group and of the Company as at 31 August 2007 and of the results and the cash flows of the Group and of the Company for the year then ended. Signed on behalf of the Board in accordance with a resolution of the directors dated 12 November 2007.
Statutory Declaration
47
the accounting and other records and the registers required by the Act to be kept by the Company and by its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act.
We have considered the nancial statements and the auditors reports thereon of the subsidiaries of which we have not acted as auditors, as indicated in Note 12 to the nancial statements, being nancial statements that have been included in the consolidated nancial statements. We are satised that the nancial statements of the subsidiaries that have been consolidated with the nancial statements of the Company are in form and content appropriate and proper for the purposes of the preparation of the consolidated nancial statements and we have received satisfactory information and explanations required by us for those purposes. The auditors reports on the nancial statements of the subsidiaries were not subject to any qualication material to the consolidated nancial statements and, in respect of subsidiaries incorporated in Malaysia, did not include any comment required to be made under Section 174 (3) of the Act.
ERNST & YOUNG AF: 0039 Chartered Accountants Melaka, Malaysia Date: 12 November 2007
48
Income Statements
Note Revenue Cost of sales Gross prot Other operating income Distribution and selling costs Administrative and general expenses Operating prot Finance costs Share of loss of associate Prot before tax Income tax expense Prot for the year Attributable to: Equity holders of the Company Minority interests 3
9 9
36.16 36.08
29.21 29.07
49
Balance Sheets
as at 31 August 2007
Group 2007 2006 RM000 RM000 Company 2007 2006 RM000 RM000
Note ASSETS Non-current assets Property, plant and equipment Investments in subsidiaries Investments in associate Other investment Due from a subsidiary Goodwill 11 12 13 14 15
Current assets Inventories Trade receivables Other receivables Tax recoverable Cash and bank balances 16 17 18 19 121,256 168,764 10,441 165,584 466,045 TOTAL ASSETS EQUITY AND LIABILTIES Equity attributable to equity holders of the Company Share capital Reserves Shareholders equity Minority interests Total equity Non-current liabilities Borrowings Deferred taxation Non-current liabilities 20 26 128,467 30,809 159,276 146,439 29,538 175,977 70,000 70,000 70,000 70,000 24 150,238 465,453 615,691 21,447 637,138 96,143 185,963 282,106 2,003 284,109 150,238 236,087 386,325 386,325 96,143 49,142 145,285 145,285 1,053,628 102,232 149,761 9,042 45 59,211 320,291 762,116 79,271 83 49,314 128,668 469,779 70,820 83 783 71,686 248,098
50
Balance Sheets
Note Current liabilities Borrowings Trade payables Other payables Tax payable Dividends payable 20 22 23
416,490 1,053,628
51
Total RM000
GROUP At 1 September 2005 94,319 Prot for the year Dividends (Note 10) Issuance of ordinary shares pursuant to ESOS 1,824 Share issue expenses Foreign currency translation Transfer to legal reserve At 31 August 2006 96,143 Prot for the year Dividends (Note 10) Issuance of ordinary shares: Private placement 13,609 Pursuant to ESOS 1,603 Issuance of bonus shares 38,883 Share issue expenses Share options granted under ESOS Foreign currency translation Transfer from legal reserve Acquisition of subsidiary At 31 August 2007 150,238 9,064 418 799 97,860 78,392 (15,182) 202,460 78,392 (15,182) 1,232 669 203,692 79,061 (15,182)
1,622 2,040 -
895 1,694 -
102 -
698 2,738
(306) 1,388
545 545
52
53
54
55
56
57
58
The residual values, useful life and depreciation method are reviewed at each nancial 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 benets embodied in the items of property, plant and equipment. An item of property, plant and equipment is derecognised upon disposal or when no future economic benets are expected from its use or disposal. The difference between the net disposal proceeds, if any and the net carrying amount is recognised in prot or loss. (e) Impairment of Non-nancial Assets The carrying amounts of assets, other than inventories and deferred tax assets, are reviewed at each balance sheet date to determine whether there is any indication of impairment. If any such indication exists, the assets recoverable amount is estimated to determine the amount of impairment loss. For goodwill that have an indenite useful life the recoverable amount is estimated at each balance sheet date or more frequently when indicators of impairment are identied. For the purpose of impairment testing of these assets, recoverable amount is determined on an individual asset basis unless the asset does not generate cash flows that are largely independent of those from other assets. If this is the case, recoverable amount is determined for the cash-generating unit (CGU) to which the asset belongs to. Goodwill acquired in a business combination is, from the acquisition date, allocated to each of the Groups CGUs, or groups of CGUs, that are expected to benet from the synergies of the combination, irrespective of whether other assets or liabilities of the Group are assigned to those units or groups of units. An assets recoverable amount is the higher of an assets or CGUs fair value less costs to sell and its value in use. In assessing value in use, 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 specic to the asset. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. Impairment losses recognised in respect of a CGU or groups of CGUs are allocated rst to reduce the carrying amount of any goodwill allocated to those units or groups of units and then, to reduce the carrying amount of the other assets in the unit or groups of units on a pro-rata basis. An impairment loss is recognised in prot or loss in the period in which it arises. Impairment loss on goodwill is not reversed in a subsequent period. An impairment loss for an asset other than goodwill is reversed if, and only if, there has been a change in the estimates used to determine the assets recoverable amount since the last impairment loss was recognised. The carrying amount of an asset other than goodwill is increased to its revised recoverable amount, provided that this amount does not exceed the carrying amount that would have been determined (net of amortisation or depreciation) had no impairment loss been recognised for the asset in prior years. A reversal of impairment loss for an asset other than goodwill is recognised in prot or loss.
59
60
61
62
63
Goodwill and fair value adjustments arising on the acquisition of foreign operations on or after 1 January 2006 are treated as assets and liabilities of the foreign operations and are recorded in the functional currency of the foreign operations and translated at the closing rate at the balance sheet date. Goodwill and fair value adjustments which arose on the acquisition of foreign subsidiaries before 1 January 2006 are deemed to be assets and liabilities of the parent company and are recorded in RM at the rates prevailing at the date of acquisition. (n) Borrowing Costs Borrowing costs directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time to get ready for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. Investment income earned on the temporary investment of specic borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalisation. All other borrowing costs are recognised in prot or loss in the period in which they are incurred.
64
65
Description of change Group Negative goodwill Retained earnings Share option reserve Company Trade and other receivables Retained earnings Share option reserve
545 (545)
2,862 (2,862) -
(ii) Effects on income statement for the year ended 31 August 2007 Increase/(Decrease) > FRS 2 FRS 3 Note 2.3(a) Note 2.3(b) Total RM000 RM000 RM000 <
Description of change Group Administrative and general expenses Other income Operating prot Prot before tax Prot for the year
66
RM000
FRS, Amendments to FRS and Interpretations (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) (xi) (xii) (xiii) (xiv) (xv) (xvi) (xvii) (xviii) (xix) FRS 117: Leases FRS 124: Related Party Disclosures FRS 139: Financial Instruments: Recognition and Measurement FRS 6: Exploration for and Evaluation of Mineral Resources Amendment to FRS 1192004: Employee Benets - Actuarial Gains and Losses, Group Plans and Disclosures Amendment to FRS 121: The Effects of Changes in Foreign Exchange Rates - Net Investment in a Foreign Operation FRS 107: Cash Flow Statements FRS 111: Construction Contracts FRS 112: Income Taxes FRS 118: Revenue FRS 120: Accounting for Government Grants and Disclosure of Government Assistance FRS 134: Interim Financial Reporting FRS 137: Provisions, Contingent Liabilities and Contingent Assets IC Interpretation 1: Changes in Existing Decommissioning, Restoration and Similar Liabilities IC Interpretation 2: Members Shares in Co-operative Entities and Similar Instruments IC Interpretation 5: Rights to Interests arising from Decommissioning, Restoration and Environmental Rehabilitation Funds IC Interpretation 6: Liabilities arising from Participating in a Specic Market - Waste Electrical and Electronic Equipment IC Interpretation 7: Applying the Restatement Approach under FRS 1292004 Financial Reporting in Hyperinflationary Economies IC Interpretation 8: Scope of FRS 2
67
Description of Change Group Deferred tax liabilities Retained earnings 2.5 Signicant Accounting Estimates and Judgements Key Sources of Estimation Uncertainty
(1,453) 1,453
The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date, that have a signicant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next nancial year are discussed below. (i) Depreciation of plant and machinery The cost of plant and machinery for the manufacture of gloves is depreciated on a straight-line basis over the assets useful lives. Management estimates the useful lives of these plant and machinery to be 10 years. These are common life expectancies applied in the industry. Changes in the expected level of usage and technological developments could impact the economic useful lives and the residual values of these assets, therefore future depreciation charges could be revised. (ii) Impairment of goodwill The Group determines whether goodwill are impaired at least on an annual basis. This requires an estimation of the value-in-use of the cash-generating units (CGU) to which goodwill are allocated. Estimating a valuein-use amount requires management to make an estimate of the expected future cash flows from the CGU and also to choose a suitable discount rate in order to calculate the present value of those cash flows. The carrying amounts of goodwill as at 31 August 2007 was RM21,078,000 (2006: RM21,078,000). Further details are disclosed in Note 15.
68
4.
FINANCE COSTS Group 2007 2006 RM000 RM000 Interest expense Less: interest expense capitalised in capital work-in-progress (Note 11 (c)) 13,948 (423) 13,525 10,818 (491) 10,327 Company 2007 2006 RM000 RM000 62 62 -
5.
PROFIT BEFORE TAX The following amounts have been included in arriving at prot before tax: Group 2007 2006 RM000 RM000 Auditors remuneration: -Statutory audit -Overprovision in prior year Bad debts written off Provision for doubtful debts Reversal of provision for doubtful debts Depreciation Non-executive directors remuneration (Note 7) Net foreign exchange losses Employee benets expense (Note 6) Rental expenses Property, plant and equipment written off Loss/(gain) on disposal of property, plant and equipment Negative goodwill written off Interest income Rental income 209 (1) 7 266 (143) 43,482 212 7,745 94,676 1,725 1,489 44 (2,862) (2,552) (417) 128 28,210 131 2,397 86,543 1,458 195 (11) (772) (333) Company 2007 2006 RM000 RM000 32 136 1,656 (1,348) 25 131 146 (107) -
69
Included in employee benets expense of the Group and of the Company are executive directors remuneration amounting to RM3,687,000 (2006: RM2,476,000) and RM823,000 (2006: RM146,000) respectively as further disclosed in Note 7. 7. DIRECTORS REMUNERATION Group 2007 2006 RM000 RM000 Directors of the Company Executive: Salaries and other emoluments Pension costs - dened contribution plan Share Options granted under ESOS Fees Benets-in-kind Company 2007 2006 RM000 RM000
Non-executive: Fees Other directors Executive: Salaries and other emoluments Pension costs - dened contribution plan Benets-in-kind
136
525 8 15 548
Non-executive: Fees Analysis excluding benets-in-kind: Total executive directors remuneration (Note 6) Total non-executive directors remuneration (Note 5) Total directors remuneration
70
3,221
Domestic current income tax is calculated at the Malaysian statutory tax rate of 27% (2006: 28%) of the estimated assessable prot for the year. The domestic statutory tax rate will be reduced to 26% from the current years rate of 27%, effective year of assessment 2008. The computation of deferred tax as at 31 August 2007 has reflected these changes. Taxation for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions. A reconciliation of income tax expense applicable to prot before tax at the statutory income tax rate to income tax expense at the effective income tax rate of the Group and of the Company is as follows: Group Prot before tax Taxation at Malaysian statutory tax rate of 27% (2006: 28%) Different tax rates in other countries Effect of changes in tax rates on opening balance of deferred tax Deferred tax recognised at different tax rates Effect of income subject to tax rate of 20% Effects of tax incentives claimed by foreign subsidiaries Effect of income not subject to tax Expenses not deductible for tax purposes Expenses entitled for double deduction for tax purposes Utilisation of current years reinvestment allowances Deferred tax assets not recognised in respect of current years tax losses and unabsorbed reinvestment allowances Under/(over) provision of deferred tax in prior years Under/(over) provision of income tax expense in prior years Income tax expense for the year 2007 RM000 118,644 32,034 336 1,068 (4,247) 30 (1,383) (1,612) 1,710 (291) (22,272) 4,438 1,742 4,204 15,757 2006 RM000 91,773 25,696 98 (41) (4,542) (30) 1,462 (56) (8,935) 1 (757) (184) 12,712
71
9.
EARNINGS PER SHARE (a) Basic Basic earnings per share amounts are calculated by dividing prot for the year attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares in issue during the nancial year. Group 2007 Prot attributable to ordinary equity holders of the Company (RM000) Weighted average number of ordinary shares in issue (000) Basic earnings per share (sen) (b) Diluted For the purpose of calculating diluted earnings per share, the prot for the year attributable to ordinary equity holders of the Company and the weighted average number of ordinary shares in issue during the nancial year have been adjusted for the dilutive effects of share options granted to employees. Group 2007 Prot attributable to ordinary equity holders of the Company (RM000) Weighted average number of ordinary shares in issue (000) Effect of dilution: share options (000) Adjusted weighted average number of ordinary shares in issue and issuable (000) Diluted earnings per share (sen) 103,795 287,015 636 287,651 36.08 2006 78,392 268,373 1,290 269,663 29.07 103,795 287,015 36.16 2006 78,392 268,373 29.21
The comparative basic and diluted earnings per share have been restated to take into account the effect of bonus issue as disclosed in Note 24.
72
Group and Company Recognised during the year: Final tax exempt dividend of 6% paid on 14 March 2006 Final dividend of 4% less 28% taxation, paid on 14 March 2006 Interim tax exempt dividend of 7%, paid on 15 September 2006 Final tax exempt dividend of 6% paid on 15 March 2007 Final dividend of 5% less 27% taxation, paid on 15 March 2007 Interim tax exempt dividend of 8%, paid on 13 September 2007 Proposed for approval: at AGM (not recognised as at 31 August): Final tax exempt dividend of 6% Final dividend of 6%, less 26% taxation
12,013
5,713 2,742 -
21,173
8,455
26,459
15,182
At the forthcoming Annual General Meeting, a final tax exempt dividend of 6% on 300,479,831 ordinary shares amounting to RM9,014,395 (3 sen per share) and a nal dividend of 6% less 26% taxation amounting to RM6,670,652 (2.22 sen per share) in respect of the nancial year ended 31 August 2007 will be proposed for shareholders approval. The nancial statements for the current nancial year do not reflect this proposed dividend. Such dividend, if approved by the shareholders, will be accounted for in equity as an appropriation of retained earnings in the nancial year ending 31 August 2008.
73
Group AT 31 AUGUST 2007 Cost At 1 September 2006 Additions Disposals Written off Reclassication Acquisition of subsidiary Exchange differences At 31 August 2007 Accumulated depreciation At 1 September 2006 Depreciation charge for the year Disposals Written off Reclassication Acquisition of subsidiary Exchange differences At 31 August 2007 Net carrying amount At 31 August 2007 AT 31 AUGUST 2006 Cost At 1 September 2005 Additions Disposals Written off Reclassication Acquisition of subsidiary Exchange differences At 31 August 2006
Total RM000
171,081
329,163
18,306
39,073
557,623
74
Group Accumulated depreciation At 1 September 2005 Depreciation charge for the year Disposals Written off Reclassication Acquisition of subsidiary Exchange differences At 31 August 2006 Net carrying amount At 31 August 2006 * Land and buildings
Total RM000
129,792
237,214
17,408
35,977
420,391
Freehold land RM000 AT 31 AUGUST 2007 Cost At 1 September 2006 Additions Written off Reclassication Acquisition of subsidiary Exchange differences At 31 August 2007 Accumulated depreciation At 1 September 2006 Depreciation charge for the year Reclassication Acquisition of subsidiary Exchange differences At 31 August 2007 Net carrying amount At 31 August 2007 43,358 39,166 3,116 1,022 54 43,358
Buildings RM000
Total RM000
10,035
117,688
171,081
75
** Other assets comprise motor vehicles, renovation, ofce furniture and equipment (a) Property, plant and equipment of the Group with the following net carrying amounts are pledged to banks for banking facilities granted to the Group as referred to in Note 20. 2007 RM000 Land and buildings Plant and equipment Other assets 65,309 146,216 7,692 219,217 2006 RM000 59,764 125,266 8,123 193,153
76
Interest expense capitalised during the financial year under capital work-in-progress of the Group amounted to RM423,000 (2006: RM491,000), as disclosed in Note 4.
12. INVESTMENTS IN SUBSIDIARIES Company 2007 2006 RM000 RM000 Unquoted shares, at cost: - in Malaysia - outside Malaysia 25,620 3,728 29,348 Details of the subsidiaries are as follows: Country of incorporation Malaysia Malaysia Malaysia Malaysia United States of America Proportion of ownership interest (%) 2007 2006 100 100 100 100 100 100 100 100 100 100 25,620 3,728 29,348
Name of company Top Glove Sdn. Bhd. (TGSB)* TG Medical Sdn. Bhd.# Great Glove Sdn. Bhd.# Top Glove Engineering Sdn. Bhd.# TG Medical (U.S.A.) Inc #
Principal activities Manufacture and trading of gloves Manufacture and trading of gloves Dormant Property investment and trading of machinery Trading of gloves
77
Name of company
Principal activities
Subsidiaries of TGSB: Great Glove (Thailand) Co. Ltd.# Top Glove Medical (Thailand) Co. Ltd.# Top Glove Technology (Thailand) Co. Ltd.# B Tech Industry Co. Ltd.# Top Glove (Zhangjiagang) Co. Ltd.# Great Glove (Xinghua) Co. Ltd.# TG Medical (Zhangjiagang) Co. Ltd.# Top Glove International Sdn. Bhd.# Top Glove Technology Sdn. Bhd.# Medi-Flex Limited (Medi-Flex)** Subsidiaries of Medi-Flex: Flexitech Sdn. Bhd. (Flexitech)* Hiclean International Pte. Ltd.** Subsidiary of Flexitech: Techniglove Asia Sdn. Bhd.* Malaysia 60 Trading of gloves Malaysia Singapore 60 60 Manufacturing of gloves Trading of gloves Thailand Thailand Thailand Thailand The Peoples Republic of China The Peoples Republic of China The Peoples Republic of China Malaysia Malaysia Singapore 74 100 100 100 100 100 100 100 100 60 74 100 100 100 100 100 100 100 100 Manufacture of gloves Manufacture of gloves Producing and selling latex concentrate Producing and selling latex concentrate Manufacture of gloves Manufacture of gloves Trading of gloves Dormant Dormant Investment holding
* Audited by Ernst & Young, Malaysia ** Audited by member rms of Ernst & Young Global in the respective countries # Audited by rms other than Ernst & Young Acquisition of Subsidiary On 15 March 2007, the Company through its wholly owned subsidiary, Top Glove Sdn. Bhd. (TGSB) subcribed 300,305,829 ordinary shares representing 60.06% of the equity interest in Medi-Flex Limited (Medi-Flex), a company incorporated in Singapore and listed on the Singapore Exchange Trading Limited Dealing and Automated System for a cash consideration of RM27.8 million, resulting in the Company to become the ultimate holding company of Medi-Flex. The acquired subsidiary has contributed the following results to the Group: 2007 RM000 Revenue Loss for the year 22,176 3,589
If the acquisition had occurred on 1 September 2006, the Groups revenue and prot for the year would have been approximately RM1,251.6 million and RM87.5 milliion respectively.
78
79
Principal activities
Singapore
21
Provide all kinds of aqueous cleaning services, consumable cleaning and sub-assembly work in clean room environment, and investment holding
The summarised nancial information of the associate are as follows: 2007 RM000 Assets and liabilities Current assets Non-current assets Total assets Current liabilities Non-current liabilities Total liabilities Results Revenue Prot for the period 12,599 11,245 23,844 (6,880) (233) (7,113) 22,600 1,157
80
81
17. TRADE RECEIVABLES Group 2007 2006 RM000 RM000 Trade receivables Less: Provision for doubtful debts 169,674 (910) 168,764 149,768 (7) 149,761
The Groups normal trade credit term ranges from 30 to 90 days. Other credit terms are assessed and approved on a case-by-case basis. The Group has no signicant concentration of credit risk that may arise from exposures to a single debtor or to groups of debtors.
82
Fixed deposits amounting to RM451,000 (2006: RM440,000) are registered in the name of certain directors, who are holding them in trust for the Group. Deposits with a licensed bank of the Group amounting to RM451,000 (2006: RM1,027,000) are pledged to banks as securities. Cash in bank of the Company amounting to RM755,000 (2006: RM755,000) are pledged to bank for Murabahah/Ijarah commercial papers and medium term notes facilities granted to the Company as referred to in Note 28. The weighted average effective interest rates of deposits at the balance sheet date were as follows: Group 2007 % Licensed banks Money market funds 3.70 3.06 2006 % 2.80 -
83
84
The weighted average effective interest rates at the balance sheet date for borrowings, excluding hire purchase payables were as follows: Group 2007 % Bank overdrafts Bankers acceptances Commercial papers Export credit renancing Medium term notes Revolving credits Trust receipts Term loans 7.9 5.0 5.4 5.9 5.7 2006 % 7.7 5.1 3.9 4.5 5.4 5.7 6.9 5.0 Company 2007 % 5.4 2006 % 3.9 5.4 -
The above bank borrowings of the Group are secured by way of xed and floating charges over certain property, plant and equipment and deposits with a licensed bank of the Group as disclosed in Note 11(a) and Note 19 respectively. 21. HIRE PURCHASE PAYABLES Group 2007 2006 RM000 RM000 Minimum hire purchase payments: Not later than 1 year Later than 1 year and not later than 2 years Later than 2 years and not later than 5 years Less: Future nance charges Present value of hire purchase payables 1,835 1,174 3,009 (169) 2,840 323 120 109 552 (54) 498
85
The hire purchase bore interest at the balance sheet date of between 2.70% to 3.50% (2006: 2.70% to 3.30%) per annum. 22. TRADE PAYABLES The normal trade credit term granted to the Group ranges from 30 to 90 days. 23. OTHER PAYABLES Group 2007 2006 RM000 RM000 Amounts payable for acquisition of a subsidiary Sundry payables and accruals 76,764 76,764 24. SHARE CAPITAL Group and Company Number of Ordinary Shares Amount 2007 2006 2007 2006 000 000 RM000 RM000 Authorised Issued and fully paid: Ordinary shares of RM0.50 each At 1 September Bonus issue Private placement Exercise of ESOS At 31 August 400,000 400,000 200,000 200,000 9,872 58,778 68,650 Company 2007 2006 RM000 RM000 1,441 1,441 1,189 1,189
86
(c) (d)
(e) (f)
(g)
(h) (i)
Subsequent to the nancial year end, the Company proposed to establish a new ESOS for the eligible persons. The maximum number of new ordinary shares of RM0.50 each to be granted under the proposed new ESOS shall not exceed 15% of the total issued and paid-up share capital of the Company at any point in time during the duration of the proposed new ESOS. The proposed new ESOS will be implemented after the expiring of the existing ESOS on 29 April 2008.
87
Grant Date 5.6.2003 6.3.2004 6.5.2004 7.6.2004 6.7.2004 6.9.2004 6.10.2004 6.11.2004 6.12.2004 4.2.2005 7.3.2005 7.4.2005 6.5.2005 6.6.2005 5.7.2005 5.8.2005 5.9.2005 5.10.2005 5.11.2005 5.12.2005 5.1.2006 5.2.2006 3.3.2006 5.4.2006 5.5.2006 5.6.2006 5.7.2006 5.8.2006 5.9.2006 5.10.2006 5.11.2006
Expiry Date 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008
Exercise Price RM 0.87 2.80 3.50 3.14 3.20 3.27 3.30 3.45 3.63 4.12 4.19 4.17 4.03 4.01 4.12 4.43 4.50 4.48 4.67 5.06 6.10 6.45 6.88 6.95 8.92 8.37 8.14 8.14 8.58 8.62 10.49
88
Grant Date 5.6.2003 6.3.2004 7.6.2004 6.7.2004 6.11.2004 6.12.2004 7.3.2005 7.4.2005 6.5.2005 6.6.2005 5.7.2005 5.8.2005 5.9.2005 5.10.2005 5.11.2005 5.12.2005 5.1.2006 5.2.2006 3.3.2006 5.4.2006 5.5.2006 5.6.2006 5.7.2006 5.8.2006 5.9.2006 5.10.2006 5.11.2006 5.6.2007
Expiry Date 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008
* Bonus issue on the basis of two new ordinary shares for every ve existing ordinary shares.
89
Grant Date 5.6.2003 6.3.2004 6.4.2004 6.5.2004 7.6.2004 6.7.2004 6.8.2004 6.9.2004 6.10.2004 6.11.2004 6.12.2004 6.1.2005 4.2.2005 7.3.2005 7.4.2005 6.5.2005 6.6.2005 5.7.2005 5.8.2005 5.9.2005 5.10.2005 5.11.2005 5.12.2005 5.1.2006 5.2.2006 3.3.2006 5.4.2006 5.5.2006 5.6.2006 5.7.2006 5.8.2006
Expiry Date 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008 29.4.2008
Exercise Price RM 0.87 2.80 3.17 3.50 3.14 3.20 3.33 3.27 3.30 3.45 3.63 3.92 4.12 4.19 4.17 4.03 4.01 4.12 4.43 4.50 4.48 4.67 5.06 6.10 6.45 6.88 6.95 8.92 8.37 8.14 8.14
90
Exercise Date 2007 Before bonus issue September 2006 - February 2007 October 2006 - February 2007 November 2006 - February 2007 After bonus issue September 2006 - August 2007 October 2006 - August 2007 November 2006 - August 2007
8.75 - 13.70 8.80 - 13.70 10.70 - 13.70 6.25 - 9.30 6.30 - 9.30 7.65 - 9.30
Less: Par value of ordinary shares Share premium 2006 September 2005 - August 2006 October 2005 - August 2006 November 2005 - August 2006 December 2005 - August 2006 January 2006 - August 2006 February 2006 - August 2006 March 2006 - August 2006 April 2006 - August 2006 June 2006 - August 2006 July 2006 - August 2006 0.87 - 4.50 4.48 4.67 5.06 6.10 6.45 6.88 6.95 8.37 8.14 5.00 - 9.91 5.00 - 9.91 5.00 - 9.91 5.00 - 9.91 6.78 - 9.91 7.17 - 9.91 7.64 - 9.91 7.72 - 9.91 9.30 - 9.91 9.04 - 9.91 3,060.2 78.2 112.8 57.2 101.2 60.5 63.4 51.5 54.7 7.0 3,646.7 Less: Par value of ordinary shares Share premium
11,346 350 527 290 617 390 436 358 458 57 14,829 (1,824) 13,005
91
The expected life of the options is based on historical data and is not necessarily indicative of exercise patterns that may occur. The expected volatility reflects the assumption that the historical volatility is indicative of future trends, which may also not necessarily be the actual outcome. No other features of the option were incorporated into the measurement of fair value. 26. DEFERRED TAXATION Group 2007 2006 RM000 RM000 At 1 September Recognised in the income statement (Note 8) At 31 August 29,538 1,271 30,809 22,405 7,133 29,538
The deferred taxation provided in the nancial statements represents the temporary differences arising between the amounts attributed to property, plant and equipment for tax purposes and their carrying amount in the financial statements. The Group has unused tax losses of approximately RM13,498,000 (2006 : RM Nil) which can be used to offset against future taxable income, such amount has not been recognised as deferred tax assets in arriving at the above deferred tax liabilities as it has arisen in a subsidiary that has recent history of losses.
92
93
The directors are of the opinion that the transactions above have been entered into in the normal course of business and have been established on negotiated and mutually agreed terms. 31. CONTINGENT LIABILITIES Company 2007 2006 RM000 RM000 Corporate guarantee issued to nancial institutions for credit facilities granted to subsidiaries (unsecured) 129,061 149,668
Save as disclosed below, the Group is not engaged in any litigation, either as plaintiff or defendant, which may have a material effect on the nancial position of the Group. (i) On 8 November 2000, Top Glove Sdn. Bhd. (TGSB), a subsidiary of the Company was served a writ of summons by Supermax Glove Manufacturing Sdn. Bhd. (SGM) claiming damages for alleged passing off by TGSB of certain coloured boxes bearing the device of a glove containing gloves manufactured by TGSB under the brand name Safemax as boxes containing gloves manufactured by SGM under the brand name Supermax. TGSBs appointed solicitors, have opined that SGMs case against the TGSB is weak and unlikely to succeed. TGSB, in relation to the suit above, has filed its defence and has also filed a counterclaim in the same suit against SGM seeking general damages for the abuse of process and/or unlawful interference with trade or business and/or the commission of deliberate and positive acts designed to injure the Company. The learned Judge was not in favour of xing trial dates until all pre-trial directions have been complied with including, inter alia, the ling of the relevant bundles of documents. The pre-trial case management was xed for 6 July 2004 for parties to le all relevant documents for purposes of trial. This date has been extended several times to 14 September 2007 for mention for pre-trial case management and pending a decision on an application for Further and Better Particulars on this suit by TGSB as set out below.
94
95
Malaysia RM000 31 AUGUST 2007 Revenue External sales Inter-segment sales Total revenue Results Operating prot/(loss) 132,239 Finance costs Share of loss of associate Prot before tax Income tax expense Prot for the year Assets Segment assets Investments in associate Goodwill 731,614 941,161 43,747 984,908
63,291 63,291
(174,952) (174,952)
1,228,778 1,228,778
6,279
(8,456)
2,111
115
163,072
85,250
43,877
Liabilities Segment liabilities Other information Capital expenditure Depreciation 52,969 31,133 34,426 8,651 18,134 3,461 237 105,529 43,482 290,038 78,115 41,487 6,850 416,490
96
Malaysia RM000 31 AUGUST 2006 Revenue External sales Inter-segment sales Total revenue Results Operating prot Finance costs Prot before tax Income tax expense Prot for the year Assets Segment assets Goodwill 514,354 83,922 766,980 48,000 814,980
55,358 55,358
(124,488) (124,488)
992,611 992,611
8,734
9,452
1,596
(1,604)
131,222
66,125
29,337
Liabilities Segment liabilities Other information Capital expenditure Depreciation 103,029 21,304 14,719 4,890 20,520 1,787 292 229 138,560 28,210 366,921 66,614 37,056 7,416 478,007
(b) Secondary reporting segment - Business segments As the Group is principally involved in gloves manufacturing industry, segment reporting by business segment is not prepared. 33. FINANCIAL INSTRUMENTS (a) Financial Risk Management Objectives and Policies The Groups nancial risk management policy seeks to ensure that adequate nancial resources are available for the development of the Groups businesses whilst managing its interest rate, foreign exchange, credit and liquidity risks.
97
98
Note Financial Assets At 31 August 2007 Due from a subsidiary Due from subsidiaries At 31 August 2006 Due from a subsidiary Due from subsidiaries 14 18 14 18
* * * *
* It is not practicable to estimate the fair value of the amount due from subsidiaries due principally to a lack of xed repayment terms entered into by the parties involved and without incurring excessive costs.
Top Glove Corporation Berhad I Annual Report 2007
99
List of Properties
The landed properties owned by Top Glove as at 31 August 2007 are set out below:
Particulars of Property Top Glove Sdn. Bhd. 18, Jalan Mempari 10, Taman Bayu, Batu 5, Jalan Meru, Klang 36, Jalan Mempari 1, Taman Bayu, Batu 5, Jalan Meru, Klang 11, Jalan Mempari 11, Taman Bayu, Batu 5, Jalan Meru, Klang Lot 4968, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang 4, Jalan Seri Kenangan 8, Taman Meru 3, Meru, 41050 Klang 6, Jalan Seri Kenangan 8, Taman Meru 3, Meru, 41050 Klang 23, Jalan Seri Kenangan 8, Taman Meru 3, Meru, 41050 Klang 22, Jalan Mempari 1, Taman Bayu, Batu 5, Jalan Meru, Klang Lot 5987, Jalan Teratai, Batu 5, Off Jalan Meru, 41050 Klang Lot 4969, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang Lot 18, 27, 38 & 57, Medan Tasek, Kawasan Perindustrian Tasek, Ipoh, Perak Date of Acquisition (A)/ Revaluation (R) Age of Building (Years) 10 Description/ Exisiting Use Land Area/ Build-Up Area Audited Net Book Value as at 31.8.2007 (RM000) 112 Tenure
HS (M) 15256, PT 8368, Mukim of Kapar, District of Selangor HS (M) 15297, PT 8411, Mukim of Kapar, District of Selangor HS (M) 15238, PT 8349, HS (M) 15238, PT 8445, Mukim of Kapar, District of Selangor EMR 6629, Lot 4968, Mukim of Kapar, District of Klang and State of Selangor HS (M) 10354, PT 15485, Mukim of Kapar, District of Selangor HS (M) 10355, PT 15486, Mukim of Kapar, District of Selangor HS (M) 10314, PT 15442, Mukim of Kapar, District of Selangor HS (M) 15304, PT 8419, Mukim of Kapar, District of Selangor EMR 8780, Lot No. 5987, Mukim of Kapar, District of Klang G.M. 2143, Lot No. 4969, Mukim of Kapar, District of Klang Lot 18, 27, 38 & 57, Medan Tasek, Kawasan Perindustrian Tasek, Ipoh, Perak GM 581, Lot No. 26290, Mukim Hulu Kinta, Daerah Kinta, Negeri Perak Darul Ridzuan GM 2326, Lot No. 4960, Mukim of Kapar, District of Klang, State of Selangor
23/10/97 (A)
Freehold
Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Factory/ Glove Manufacturing Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Factory/ Glove Manufacturing Factory & Ofce Building Factory/ Glove Manufacturing
1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 3 acres/ 66,980 square feet 1,640 square feet/1,400 square feet 1,640 square feet/1,400 square feet 1,608 square feet/1,350 square feet 1,300 square feet/1,100 square feet 2.8 acres/ 57,250 square feet 3 acres/ 41,274 square feet 31,192 square feet/ 197,675 square feet
13/2/98 (A)
Freehold
110
15/9/97 (A)
10
Freehold
104
13/10/93 (A)
13
Freehold
5,818
29/7/95 (A)
12
Freehold
83
29/7/95 (A)
12
Freehold
83
23/5/96 (A)
11
Freehold
104
15/9/97 (A)
10
Freehold
112
18/4/96 (A)
Freehold
3,516
11/10/00 (A)
Freehold
8,094
22/11/99 (A)
19
Leasehold (expiring on: Lot 18-30.9.2072 Lot 27-28.12.2063 Lot 38-23.12.2069 Lot 57-1.10.2064) Freehold
11,335
GM 581, Lot No. 26290, Mukim Hulu Kinta, Daerah Kinta, Negeri Perak Darul Ridzuan Lot 4960, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang
29/11/05 (A)
N/A
Vacant
3 acres
1,022
24/09/03 (A)
Freehold
8,569
100
Lot 4967, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang Lot 5104, Jalan Teratai, Batu 5, Off Jalan Meru, 41050 Klang Lot 4975, Jalan Teratai, Batu 6 , Off Jalan Meru, 41050 Klang 21, Jalan Mempari 11, Taman Bayu, Batu 5 , Jalan Meru, Klang 37, Jalan Mempari 1, Taman Bayu, Batu 5 , Jalan Meru, Klang 6, Jalan Sg. Binjai, Klang 21, Jalan Sesenduk 20, Off Taman Meru Jaya, 41050 Klang 23, Jalan Sesenduk 20, Off Taman Meru Jaya, 41050 Klang 27, Lorong Tempinis 1, Pekan Meru, 42200 Klang 57, Jalan Sesenduk 5, Taman Meru Utama, 41050 Klang 51, Jalan Sesenduk 5, Taman Meru Utama, 41050 Klang 67, Jalan Sesenduk 6, Taman Meru Utama, 41050 Klang 65, Jalan Sesenduk 6, Taman Meru Utama, 41050 Klang Lot 4947, Jalan Teratai, Batu 5 , Off Jalan Meru, 41050 Klang
19/03/04 (A)
Freehold
7,649
29/03/04 (A)
Freehold
7,296
05/05/04 (A)
N/A
Freehold
1,080
12/05/05 (A)
Freehold
Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Terrace house/ Accomodation for staff Factory/ Glove Manufacturing
1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 1,300 square feet/1,100 square feet 3 acres/ 58,240 square feet
127
12/05/05 (A)
Freehold
144
21/03/05 (A)
Freehold
154
13/05/05 (A)
Freehold
155
13/05/05 (A)
Freehold
155
25/05/05 (A)
Freehold
126
19/07/05 (A)
Freehold
154
19/07/05 (A)
Freehold
154
19/07/05 (A)
Freehold
144
19/07/05 (A)
Freehold
144
23/11/04 (A)
Freehold
8,551
101
62, 64, 66, 67, 69, 71, 73, 75 & 77, Jalan Abadi 4/KU8, 49, 51, 53, 55, 57, 59, 62, 64, 66, 68, 70 & 72, Jalan Abadi 5/KU8 46, 48, 50, 52, 54 & 56, Jalan Abadi 6/KU8, Taman Daya Maju, 41050 Klang 41, Jalan Abadi 3, Taman Daya Meru, 41050 Klang Lot 4991, Jalan Bunga Raya, Batu 5 , Off Jalan Meru, 41050 Klang Lot 4908, Jalan Teratai, Batu 5 , Off Jalan Meru, 41050 Klang Lot 4988 & 4989, Mukim Kapar, Klang, Selangor
19/10/04 (A)
N/A
Freehold
3,390
08/07/97 (A)
Freehold
2,295
10/10/05 (A)
N/A
Freehold
3,293
Lot 4986, Batu 5, Jalan Sungai Binjai, Mukim Kapar, Klang Lot 4987, Batu 5, Jalan Teratai, Mukim Kapar, Klang Lot 4990, Jalan Bunga Raya, Batu 5 , Off Jalan Meru, 41050 Klang
24/02/06 (A)
N/A
Freehold
Vacant
3 acres
1,654
24/05/06 (A)
N/A
Freehold
Under Construction
3 acres
1,627
05/03/07 (A)
N/A
Freehold
Vacant
3 acres
2,061
102
25/10/95 (A)
Freehold
104
Lot 5972 & 5974, Jalan Teratai, Batu 5, Jalan Meru, 41050 Klang
1/7/99 (A)
Freehold
Approx 1.7935 acres/47,200 square feet 2.8 acres/ 57,250 square feet Approx 16.06 acres
3,867
Top Glove Engineering Sdn. Bhd. Lot 5987, Jalan Teratai, Batu 5, Off Jalan Meru, 41050 Klang, Selangor Darul Ehsan Top Glove Medical (Thailand) Co. Ltd. 188, Moo 5, Karnchanawanich Road Tambon Sumnukgarm Sadao, Songkhla 90320, Thailand Top Glove Technology (Thailand) Co. Ltd. 188, Moo 5, Tambol Pangla Amphur Sadao, Songkhla 90170, Thailand B Tech Industry Co. Ltd. 268 M.5, T.Kampangphet A.Rattaphum, Songkhla 90180, Thailand TG Medical (U.S.A.) Inc. 165-167, North Aspan Avenue, Azusa, CA 91702 Top Glove (ZhangJiaGang) Co. Ltd. 53, Zhenbei Road, Xizhang Street, Fenghuang Town Zhangjiagang City, Jiangsu Province 215614, China
18/4/96 (A)
Freehold
2,107
5/10/01 (A)
Freehold
8,821
23/02/06 (A)
2 months
Freehold
12,237
01/08/06(A)
Freehold
Factory & Ofce Building Warehouse & Ofce Building Factory & Ofce Building
Approx 482,048 square feet Approx 47,896 sq ft/ 25,878 sq ft Approx 60,121.8 sq meter/ 21,703 square meter 112,234.8 square meter
5,285
31/03/05 (A)
Freehold
8,828
10/09/02 (A)
11,812
Great Glove (XingHua) Co. Ltd. South Wei Wu Lu, South Weiwu Road, Zhao Yang Zheng, West of Xihuan Road, Xinghua City Xinghua Economic Developing District, 225700 Jiangsu Province, China Flexitech Sdn. Bhd. Lot 127, Jalan 6, Komplek Olak Lempit, Mukim Tanjung 12, 42700 Banting, Selangor D.E. Lot 128, Jalan 8, Komplek Olak Lempit, Mukim Tanjung 12, 42700 Banting, Selangor D.E. HS (M) 5735, PT4065, Komplek Perabot Olak Lempit, Mukim Tanjung 12, Daerah Kuala Langat HS (M) 5719, PT4049, Komplek Perabot Olak Lempit, Mukim Tanjung 12, Daerah Kuala Langat
13/10/05 (A)
22 months
9,951
15/09/05 (A)
13
Factory
3,981
02/08/05 (A)
11
Factory
3,426
103
Analysis of Shareholdings
as at 16 October 2007
Authorised Share Capital Issued and Fully Paid-Up Capital Class of Shares Voting Rights 1. : RM200,000,000 : RM150,239,915.50 : Ordinary Shares of RM0.50 each : One vote per ordinary share
DISTRIBUTION OF SHAREHOLDERS Size of Holdings 1 - 99 100 - 1,000 1,001 - 10,000 10,001 - 100,000 100,001 - 14,961,260 (less than 5% of Issued Shares) 14,961,261 (5% of Issued Shares) and above No. of Holders 201 1,152 1,320 288 129 3 3,093 % No. of Shares 6.50 37.24 42.68 9.31 4.17 0.10 100.00 10,651 832,652 4,942,768 7,842,728 184,076,452 101,519,980 299,225,231 % 0.00 0.28 1.65 2.62 61.52 33.93 100.00
2.
LIST OF SUBSTANTIAL SHAREHOLDERS The Substantial Shareholders of Top Glove Corporation Berhad (Top Glove) based on the Register of Substantial Shareholders of the Company and their respective shareholdings are as follows: No. Substantial Shareholders 1. 2. 3. 4. 5. 6. Tan Sri Dr. Lim, Wee-Chai Puan Sri Tong Siew Bee Lim Hooi Sin Lim Quee Choo Top Glove Holding Sdn. Bhd. Matthews International Capital Management, LLC Direct 87,242,900 4,597,874 7,105,181 2,983,869 16,076,897 18,102,280 No. of Ordinary Shares Held % Indirect 29.16 1.54 2.37 1.00 5.37 6.05 30,763,821* 113,408,847** 110,901,540*** 115,022,852**** % 10.28 37.90 37.06 38.44 -
Note: * ** Deemed interested through Puan Sri Tong Siew Bee, Mr. Lim Hooi Sin, Ms. Lim Quee Choo and Top Glove Holding Sdn. Bhd.s direct interest in Top Glove Deemed interested through Tan Sri Dr. Lim, Wee-Chai, Mr. Lim Hooi Sin, Ms. Lim Quee Choo and Top Glove Holding Sdn. Bhd.s direct interest in Top Glove
*** Deemed interested through Tan Sri Dr. Lim, Wee-Chai, Puan Sri Tong Siew Bee, Ms. Lim Quee Choo and Top Glove Holding Sdn. Bhd.s direct interest in Top Glove **** Deemed interested through Tan Sri Dr. Lim, Wee-Chai, Puan Sri Tong Siew Bee, Mr. Lim Hooi Sin and Top Glove Holding Sdn. Bhd.s direct interest in Top Glove
104
Analysis of Shareholdings
as at 16 October 2007 (contd)
3. DIRECTORS SHAREHOLDINGS The Directors Shareholdings of Top Glove based on the Record of Depositors are as follows: No. Directors 1. 2. 3. 4. 5. 6. 7. 8. 9. Note: * ** Deemed interested through Puan Sri Tong Siew Bee, Mr. Lim Hooi Sin, Ms. Lim Quee Choo and Top Glove Holding Sdn. Bhd.s direct interest in Top Glove Deemed interested through Tan Sri Dr. Lim, Wee-Chai, Mr. Lim Hooi Sin, Ms. Lim Quee Choo and Top Glove Holding Sdn. Bhd.s direct interest in Top Glove Tan Sri Dr. Lim, Wee-Chai Puan Sri Tong Siew Bee Lim Hooi Sin Sekarajasekaran a/l Arasaratnam Lau Boon Ann Tan Sri Datuk (Dr.) Arshad Bin Ayub Lee Kim Meow Quah Chin Chye Lim Cheong Guan Direct 87,242,900 4,597,874 7,105,181 10,466,669 274,960 1,630,000 763,016 No. of Ordinary Shares Held % Indirect 29.16 1.54 2.37 3.50 0.09 0.54 0.25 30,763,821* 113,408,847** 110,901,540*** 5,000**** % 10.28 37.90 37.06 0.00 -
*** Deemed interested through Tan Sri Dr. Lim, Wee-Chai, Puan Sri Tong Siew Bee, Ms. Lim Quee Choo and Top Glove Holding Sdn. Bhd.s direct interest in Top Glove **** Deemed interested through Ms. Chung Lee Moy 4. LIST OF THIRTY LARGEST SECURITIES ACCOUNTS HOLDERS No. Names 1. Tan Sri Dr. Lim, Wee-Chai 2. Tan Sri Dr. Lim, Wee-Chai 3. HSBC Nominees (Asing) Sdn. Bhd. - BBH and Co. Boston for Matthews Pacic Tiger Fund 4. HSBC Nominees (Asing) Sdn. Bhd. - HSBC-FS for The Overlook Partners Fund LP 5. Portola Investment Holdings Corp. 6. Cartaban Nominees (Asing) Sdn. Bhd. - SSBT Fund HG22 for Smallcap World Fund, Inc. 7. Top Glove Holding Sdn. Bhd. 8. Employees Provident Fund Board 9. Mayban Nominees (Tempatan) Sdn. Bhd. - Mayban Trustees Berhad for Public Ittikal Fund 10. Cartaban Nominees (Asing) Sdn. Bhd. - SSBT Fund D26J for Emerging Markets Global Small Capitalization Fund 11. Mayban Nominees (Tempatan) Sdn. Bhd. - Mayban Trustees Berhad for Public Regular Savings Fund Shareholdings 60,992,447 24,917,653 15,609,880 13,820,580 13,591,158 8,220,500 7,700,000 5,771,580 5,439,360 5,160,100 4,643,980 % 20.38 8.33 5.22 4.62 4.54 2.75 2.57 1.93 1.82 1.72 1.55
105
Analysis of Shareholdings
as at 16 October 2007 (contd)
4. No. Names 12. Cartaban Nominees (Asing) Sdn. Bhd. - SSBT Fund ZM47 for Aim Developing Markets Fund 13. Lim Hooi Sin 14. HSBC Nominees (Asing) Sdn. Bhd. - TNTC for Saudi Arabian Monetary Agency 15. Top Glove Holding Sdn. Bhd. 16. Amanah Raya Nominees (Tempatan) Sdn. Bhd. - Skim Amanah Saham Bumiputera 17. Cartaban Nominees (Asing) Sdn. Bhd. - SSBT Fund HG19 for Global Small Capitalization 18. EB Nominees (Tempatan) Sendirian Berhad - Pledged Securities Account for Sekarajasekaran a/l Arasaratnam 19. Amanah Raya Nominees (Tempatan) Sdn. Bhd. - Public Equity Fund 20. Citigroup Nominees (Tempatan) Sdn. Bhd. - Pledged Securities Account for Sekarajasekaran a/l Arasaratnam 21. Puan Sri Tong Siew Bee 22. Top Glove Holding Sdn. Bhd. 23. HSBC Nominees (Asing) Sdn. Bhd. - Exempt an for JPMorgan Chase Bank, National Association 24. HSBC Nominees (Asing) Sdn. Bhd. - Dresdner Bank Luxembourg SA for Dit-Bric Stars 25. Lim Hooi Sin 26. Amanah Raya Nominees (Tempatan) Sdn. Bhd. - Public Growth Fund 27. HSBC Nominees (Asing) Sdn. Bhd. - Exempt an for JPMorgan Chase Bank, National Association 28. Amanah Raya Nominees (Tempatan) Sdn. Bhd. - Public Islamic Equity Fund 29. HSBC Nominees (Asing) Sdn. Bhd. - KBC Bank NV Brussels for KBC Equity Fund 30. Cartaban Nominees (Asing) Sdn. Bhd. - UBOC Global Custody for MTap Asian Institution Partners LP Note: The analysis of shareholdings is based on the issued and paid-up capital of the Company after deducting 1,254,600 ordinary shares bought back by the Company and held as treasury shares as at 16 October 2007. LIST OF THIRTY LARGEST SECURITIES ACCOUNTS HOLDERS (contd) Shareholdings 4,609,700 4,532,816 3,955,939 3,941,616 3,879,700 3,625,000 3,420,000 3,251,900 3,000,000 2,923,505 2,906,481 2,666,230 2,663,800 2,572,365 2,399,300 2,287,880 2,241,740 2,219,500 2,007,100 % 1.54 1.52 1.32 1.32 1.30 1.21 1.14 1.09 1.00 0.98 0.97 0.89 0.89 0.86 0.80 0.77 0.75 0.74 0.67
106
To pass the following resolution pursuant to Section 129(6) of the Companies Act, 1965: That pursuant to Section 129(6) of the Companies Act, 1965, the following Directors who have attained the age of seventy (70) years, be and are hereby re-appointed as Directors of the Company and to hold ofce until the conclusion of the next Annual General Meeting: (a) (b) Tan Sri Datuk (Dr.) Arshad Bin Ayub Mr. Sekarajasekaran a/l Arasaratnam (Resolution 5) (Resolution 6)
6. 7.
To re-appoint Messrs. Ernst & Young as Auditors of the Company until the conclusion of the next Annual General Meeting and to authorise the Directors to x their remuneration. (Resolution 7) As Special Business To consider and, if thought t, with or without any modication, to pass the following resolutions which will be proposed as Ordinary and Special Resolutions: Ordinary Resolution No. 1 - Authority To Issue Shares Pursuant To Section 132D Of The Companies Act, 1965 THAT subject to Section 132D of the Companies Act, 1965 and approvals of the relevant governmental/ regulatory authorities, the Directors be and are hereby empowered to issue and allot shares in the Company, at any time to such persons and upon such terms and conditions and for such purposes as the Directors may, in their absolute discretion, deem t, provided that the aggregate number of shares issued pursuant to this Resolution does not exceed ten per centum (10%) of the issued and paid-up share capital of the Company for the time being and the Directors be and are also empowered to obtain the approval for the listing of and quotation for the additional shares so issued on Bursa Malaysia Securities Berhad; AND THAT such authority shall commence immediately upon the passing of this resolution and continue to be in force until the conclusion of the next Annual General Meeting of the (Resolution 8) Company.
107
(ii)
(iii) the authority is revoked or varied by ordinary resolution passed by the shareholders of the Company at a general meeting, whichever is the earlier; AND THAT the Board be and is hereby authorised to take such steps to give full effect to the Proposed Share Buy-Back with full power to assent to any conditions, modications, variations and/or amendments as may be imposed by the relevant authorities and/or to do all such acts and things as the Board may deem t and expedient in the best interest of the Company. (Resolution 9) Ordinary Resolution No. 3 - Proposed Issue of Options to Mr. Lee Kim Meow, Executive Director of the Company THAT the Directors be and are hereby authorised at any time and from time to time to offer and to grant to Mr. Lee Kim Meow, Executive Director of the Company, options to subscribe for such number of ordinary shares up to a maximum of 600,000 new ordinary shares of RM0.50 each in the Company to be allotted and issued subject always to such terms and conditions and/or adjustments which may be made in accordance with the provisions of the Bye-Laws governing and constituting the Companys Employees Share Option Scheme and to allot and issue ordinary shares in the Company pursuant to the exercise of such options notwithstanding that the issue thereof may take place after the next or any ensuing annual general meeting of the Company. (Resolution 10)
108
NOTICE OF DIVIDEND ENTITLEMENT NOTICE IS ALSO HEREBY GIVEN THAT the Final Dividend of 6% less 26% Malaysian Income Tax and 6% Tax Exempt in respect of the nancial year ended 31 August 2007 will be payable on 14 March 2008 to depositors who are registered in the Record of Depositors at the close of business on 15 February 2008, if approved by Members at the forthcoming Ninth Annual General Meeting on 9 January 2008. A Depositor shall qualify for entitlement only in respect of: (a) (b) Shares transferred into the Depositors Securities Account before 4.00 p.m. on 15 February 2008 in respect of ordinary transfers; and Shares bought on Bursa Malaysia Securities Berhad (Bursa Securities) on a cum entitlement basis according to the Rules of Bursa Securities.
By Order of the Board CHUA SIEW CHUAN (MAICSA 0777689) Company Secretary Kuala Lumpur Dated: 27 November 2007
109
2. 3. 4.
STATEMENT ACCOMPANYING NOTICE OF ANNUAL GENERAL MEETING The Directors who are standing for re-election at the Ninth Annual General Meeting of the Company are as follows: Name of Directors Tan Sri Datuk (Dr.) Arshad Bin Ayub (Section 129(6) of the Companies Act, 1965) Mr. Sekarajasekaran a/l Arasaratnam (Section 129(6) of the Companies Act, 1965) Mr. Lau Boon Ann (Article 94 of the Companys Articles of Association) Mr. Quah Chin Chye (Article 94 of the Companys Articles of Association) Shareholdings of Directors Refer to page 105 of the Annual Report. Refer to page 105 of the Annual Report. Refer to page 105 of the Annual Report. Refer to page 105 of the Annual Report. Details of Individual Director and other Disclosure Requirements Refer to page 9 of the Annual Report. Refer to page 11 of the Annual Report. Refer to page 11 of the Annual Report. Refer to page 12 of the Annual Report.
110
Form of Proxy
*I/We (full name in capital letters) _________________________________________________________________ (NRIC/Company No. ______________________________) of (full address) _________________________________ __________________________________ being a *Member/Members of TOP GLOVE CORPORATION BHD. (the Company), do hereby appoint (full name in capital letters) _________________________________________________________ (NRIC No. _________________________) of (full address) ____________________________________________ _________________________________ or failing *him/her, (full name in capital letters) ______________________ ____________________________________________ (NRIC No. _____________________________________) of (full address) _____________________________________________________________________________ or failing *him/her, *the CHAIRMAN OF THE MEETING, as *my/our proxy to attend and vote for *me/us, and on *my/our behalf at the Ninth Annual General Meeting of the Company to be held at Sime Darby Convention Centre, Banyan & Casuarina Function Rooms (Ground Floor) of 1A, Jalan Bukit Kiara 1, 60000 Kuala Lumpur on Wednesday, 9 January 2008 at 11.30 a.m. and at any adjournment thereof. Please indicate with an X in the spaces provided below how you wish your votes to be casted. If no specic direction as to voting is given, the Proxy will vote or abstain from voting at his/her discretion. Agenda Nos. Resolutions 1 To receive the Audited Financial Statements for the nancial year ended 31 August 2007 together with the Reports of the Directors and the Auditors thereon. 2 To approve the declaration of the Final Dividend of 6% less 26% Malaysian Income Tax and 6% Tax Exempt for the nancial year ended 31 August 2007. (Resolution 1) 3 To approve the payment of Directors Fees for the financial year ended 31 August 2007. (Resolution 2) 4 (a) To re-elect the Director, Mr. Lau Boon Ann who retires pursuant to Article 94 of the Companys Articles of Association. (Resolution 3) 4 (b) To re-elect the Director, Mr. Quah Chin Chye who retires pursuant to Article 94 of the Companys Articles of Association. (Resolution 4) 5 (a) To re-elect the Director, Tan Sri Datuk (Dr.) Arshad Bin Ayub who retires pursuant to Section 129(6) of the Companies Act, 1965. (Resolution 5) 5 (b) To re-elect the Director, Mr. Sekarajasekaran a/l Arasaratnam who retires pursuant to Section 129(6) of the Companies Act, 1965. (Resolution 6) 6 To re-appoint Messrs. Ernst & Young as Auditors of the Company until the conclusion of the next Annual General Meeting and to authorise the Directors to x their remuneration. (Resolution 7) 7 As Special Business Ordinary Resolution No. 1 - Authority to issue shares pursuant to Section 132D of the Companies Act, 1965. (Resolution 8) Ordinary Resolution No. 2 - Proposed Renewal of Authority for Share Buy-Back. (Resolution 9) Ordinary Resolution No. 3 - Proposed Issue of Options to Mr. Lee Kim Meow, Executive Director of the Company. (Resolution 10) Ordinary Resolution No. 4 - Proposed Issue of Options to Mr. Lim Cheong Guan, Executive Director of the Company. (Resolution 11) Special Resolution - Proposed Amendments to the Articles of Association of the Company. (Resolution 12) * Strike out whichever not applicable. Signed on this _____________ day of _____________ 2007/2008 Number of Shares held For Against
___________________________
111
STAMP
F9
F2
FACTORY 2
Lot 4968, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3392 1992 / 1905 Fax : 603-3392 1291 / 8410
F3
FACTORY 12
Lot 4960, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3392 3375 Fax : 603-3392 5200
F13
FACTORY 3
Lot 5091, Jalan Teratai, Batu 5, Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3392 7880 / 7350 Fax : 603-3392 7229 / 9160
F14
FACTORY 13
Lot 4947, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3393 1288 Fax : 603-3393 1993
F4
FACTORY 4
Lot 5987, Jalan Teratai, Batu 5, Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3392 8588 / 8996 Fax : 603-3392 6788
F5
FACTORY 14
Lot 5104, Jalan Teratai, Batu 5, Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3392 7880 / 7350 Fax : 603-3392 7229 / 9160
F15
FACTORY 5
Lot 18, 27, 38 & 57, Medan Tasek, Kawasan Perindustrian Tasek, 31400 Ipoh, Perak D.R., Malaysia Tel : 605-546 6360 / 547 9271 Fax : 605-547 8975
F16L
FACTORY 15
South of Weiwu Road, West of Xihuan Road, Xinghua Economic Developing District. 225700 Jiang Su Provience, China Tel : 86-523-8326 8976 / 86-523-8349 5661 Fax : 86-523-8326 8676
F6
FACTORY 6
180/3, M. 7, Srisonthon Rd. A, Thalang, Phuket 83110, Thailand Tel : 6676-272 572 / 272 573 Fax : 6676-325 354
F7
FACTORY 16L
188, Moo 5, Tambol Pangla Amphur Sadao, Songkhla 90170 Thailand Tel : 6674-410 888 Fax : 6674-410 886
F17L
FACTORY 7
188, Moo 5, Karnchanawanich Rd. Tambon, Sumnukgram, Sadao, Songkhla, 90320 Thailand Tel : 6674-410 000 Fax : 6674-410 008
FACTORY 17L
268, M.5 T. Kampangphet A. Rattaphum, Songkhla 90180 Thailand Tel : 6674-3184 111-2 Fax : 6674-3184 112-3
F8
FACTORY 8
53, Zhenbei Road, Xizhang Street, Fenghuang Town Zhangjiagang City, Jiangsu Province 215614, China Tel : 86-512-5842 2860 Fax : 86-512-5842 2870
F10
F18A
FACTORY 18A
Lot 5071, Batu 5 , Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3392 0188 Fax : 603-3392 0228
FACTORY 10
Lot 4970, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3392 1992 / 1905 Fax : 603-3392 1291 / 8410
F18B
FACTORY 18B
Lot 124 & 126, Jalan Lapan, Kompleks Olak Lempit, KM 13, Jalan Banting Dengkil, 42700 Banting, Selangor D.E., Malaysia Tel : 603-3149 1998 Fax : 603-3149 3008
F11
FACTORY 11
Lot 4967, Jalan Teratai, Batu 6, Off Jalan Meru, 41050 Klang, Selangor D.E., Malaysia Tel : 603-3392 1899 Fax : 603-3363 5771
F19
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