Pantech

Contents 02
Corporate Information
03
Corporate Structure Notice of Annual General Meeting Statement Accompanying Notice of Annual General Meeting Appendix I
04
06 07
09 12
Directors Prole Executive Chairmans Statement
15 16 18 20 24
Corporate Social Responsibility Activities Audit Committee Report Statement on Internal Control Corporate Governance Statement Additional Compliance Statement
25
73 74
Financial Statements List of Properties Analysis of Shareholdings Proxy Form
Corporate Information
Board Of Directors
1. 2. 3. 4. Chew Ting Leng Executive Chairman / Group Managing Director Goh Teoh Kean Group Deputy Managing Director Tan Ang Ang Executive Director To Tai Wai Executive Director 5. 6. 7. 8. Abdul Karim Bin Ahmad Non-Independent Non-Executive Director Tan Sui Hin Independent Non-Executive Director Loh Wei Tak Independent Non-Executive Director Saw Siew Ee Independent Non-Executive Director
Audit Committee
Chairman Tan Sui Hin Members Loh Wei Tak Goh Teoh Kean
Company Secretaries
Lim Seck Wah (MAICSA NO.: 0799845) Liang Siew Ching (MAICSA NO.: 7000168)
Principal Bankers
CIMB Bank Berhad Citibank Berhad EON Bank Berhad HSBC Bank Malaysia Berhad United Overseas Bank (Malaysia) Berhad Hong Leong Bank Berhad Afn Bank Berhad Standard Chartered Bank Malaysia Berhad
Remuneration Committee
Chairman Chew Ting Leng Members Tan Sui Hin Saw Siew Ee
Registered Office
Level 15-2, Faber Imperial Court Jalan Sultan Ismail 50250 Kuala Lumpur Tel: 03-26924271 Fax: 03-27325388
Solicitors
Adi Radlan & Co
Auditors
Shamsir Jasani Grant Thornton Chartered Accountants
Nomination Committee
Chairman Tan Sui Hin Members Loh Wei Tak Saw Siew Ee
Share Registrar
MEGA CORPORATE SERVICES SDN. BHD. (Company No.: 187984-H) Level 15-2, Faber Imperial Court Jalan Sultan Ismail 50250 Kuala Lumpur Tel No.: 03-26924271 Fax No. : 03-27325388
Stock Exchange Listing

Main Board of Bursa Securities Bursa Securities refers to Bursa Malaysia Securities Berhad STOCK CODE: 5125
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PANTECH GROUP HOLDINGS BERHAD (733607-W)
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Corporate Structure
Pantech Steel Industries Sdn Bhd
100%
Pantech Corporation Sdn Bhd
Panao Controls Pte Ltd
100%
100%
Pantech (Kuantan) Sdn Bhd
Jayee Holdings Sdn Bhd
Tuah Nusa Sdn Bhd
JC Flow Controls Pte Ltd
100%
100%
30%
70%
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Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN that the First Annual General Meeting of the members of the Company will be held at Prince 3, Level 3, Prince Hotel & Residence Kuala Lumpur, Jalan Conlay, 50450 Kuala Lumpur, on Friday, 10th August 2007 at 10.00 am for the following purposes:AGENDA AS ORDINARY BUSINESS 1. 2. To receive the Audited Financial Statements for the nancial year ended 28 February 2007 together with the Directors and Auditors Reports thereon. To approve the payment of a First and Final Dividend of 3 sen per ordinary share of RM0.50 each less 27% Malaysian Income Tax for the nancial year ended 28 February 2007. To approve the payment of Directors fees for the year ended 28 February 2007. To re-elect the following directors retiring pursuant to Article 127 of the Companys Articles of Association and being eligible, offered themselves for re-election: 4.1 4.2 4.3 4.4 4.5 4.6 4.7 5. Mr Chew Ting Leng Mr Goh Teoh Kean Mr To Tai Wai Mr Tan Ang Ang Mr Loh Wei Tak Mr Tan Sui Hin Encik Abdul Karim Bin Ahmad Resolution 3 Resolution 4 Resolution 5 Resolution 6 Resolution 7 Resolution 8 Resolution 9 Resolution 10 Please refer to Note A Resolution 1
3. 4.
Resolution 2
To re-appoint Messrs Shamsir Jasani Grant Thornton as Auditors of the Company and to authorise the Directors to x their remuneration.
AS SPECIAL BUSINESS To consider, and if thought t, to pass the following Ordinary Resolution: 6. AUTHORITY TO ISSUE SHARES BY THE COMPANY PURSUANT TO SECTION 132D OF THE COMPANIES ACT, 1965 THAT pursuant to Section 132D of the Companies Act, 1965, and subject to the approvals of the relevant governmental and/or regulatory authorities, the Directors be and are hereby empowered to issue new shares in the Company from time to time upon such terms and conditions and for such purposes as the Directors may deem t provided that the aggregate number of shares issued pursuant to this resolution does not exceed 10% of the issued share capital of the Company as at the date of this AGM and that such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company and THAT the Directors be and are hereby also authorised to obtain the approval from Bursa Securities for the listing and quotation of the additional shares so issued. 7. SPECIAL RESOLUTION PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY THAT approval be hereby given for the Articles of Association of the Company to be amended as per Appendix 1 in the Annual Report 2007 to conform with the enhanced Listing Requirements of Bursa Malaysia Securities Berhad Resolution 12 Resolution 11
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Notice of Annual General Meeting

NOTICE OF DIVIDEND ENTITLEMENT AND PAYMENT Subject to the approval of the shareholders, a First and Final Dividend of 3 sen less 27% Malaysian Income Tax per ordinary share of RM0.50 each for the nancial year ended 28 February 2007 will be paid on 17 September 2007 to Depositors registered in the Record of Depositors at the close of business at 5.00 pm on 30 August 2007. A depositor shall qualify for entitlement only in respect of: a) Shares transferred into the Depositors Securities Account before 4.00 pm on 30 August 2007, in respect of ordinary transfers; and b) Shares bought on Bursa Securities on a cum entitlement basis according to the Rules of the Bursa Securities. By order of the Board
LIM SECK WAH (MAICSA 0799845) LIANG SIEW CHING (MAICSA 7000168) Company Secretaries Dated this: 19 July 2007 Kuala Lumpur
Notes A. 1. The item 1 of the Agenda is meant for discussion only as it does not require a formal approval of the shareholders and hence, is not put forward for voting A member entitled to attend and vote at the Meeting is entitled to appoint a proxy to attend and vote in his/her stead. A member may appoint up to two (2) proxies to attend the same meeting provided that he species the proportion of his shareholding to be represented by each proxy. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy without limitation and the provisions of Section 149(1)(b) & (c) of the Companies Act, 1965 shall not apply. Where a member is an authorised nominee as dened under the Security Industry (Central Depositories) Act, 1991, it may appoint at least one (1) proxy in respect of each Securities account it holds with ordinary shares of the Company standing to the credit of the said securities account. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorized in writing or, if the appointer is a corporation, either under the Corporations Common Seal or under the hand of an ofcer or attorney so authorized. The Form of Proxy must be deposited at the Registered Ofce of the Company at Level 15-2, Faber Imperial Court, Jalan Sultan Ismail, 50250 Kuala Lumpur not less than 48 hours before the time set for holding the meeting or any adjournment thereof. Explanatory Notes on Special Businesses: Ordinary Resolution 11 The proposed Ordinary Resolution no.11 is primarily to give exibility to the Board of Directors to issue and allot shares at any time in their absolute discretion up to and not exceeding in total ten per centum (10%) of the issued share capital of the Company as at the date of this AGM for such purposes as they consider would be in the best interest of the Company without convening a general meeting. This authority, unless revoked or varied by the Company at a general meeting, will expire at the next Annual General Meeting of the Company. Special Resolution 12 The proposed Special Resolution no. 12 on the Proposed Amendments to the Articles of Association of the Company are made to conform with the enhanced Listing Requirements of Bursa Malaysia Securities Berhad. Please refer to Appendix 1 in the Annual Report 2007 for details of the Proposed Amendments.
2.
3.
4.
5.
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Statement Accompanying Notice of Annual General Meeting

Directors Standing for Re-election Pursuant to Article 127, all Directors are subject to retire at the First AGM. Saves for Madam Saw Siew Ee, all the other Directors being eligible, offer themselves for re-election. The Directors who are standing for re-election at the First Annual General Meeting of the Company are as follows:1. 2. 3. 4. 5. 6. 7. Mr Chew Ting Leng Mr Goh Teoh Kean Mr To Tai Wai Mr Tan Ang Ang Mr Loh Wei Tak Mr Tan Sui Hin Encik Abdul Karim Bin Ahmad Resolution 3 Resolution 4 Resolution 5 Resolution 6 Resolution 7 Resolution 8 Resolution 9
Madam Saw Siew Ee, the Independent Non-Executive Director does not wish to offer herself for re-election. Further details of the above Directors are set out in the Prole of Directors on page 9 to 11 of this Annual Report and the Statement of Directors shareholdings on page 74 of this Annual Report.
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Appendix I
PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY ARTICLE NO. Article 2 (Denition) EXISTING PROVISIONS Approved Market Place A stock exchange which is specied to be an approved market place in the Securities Industry (Central Depositories) Exemption Order (No. 2) 1998 as may be amended, modied or altered from time to time. Issue of preference shares The total nominal value of preference shares issued shall not exceed the total nominal value of the issued ordinary shares at any time. 3(A)(3) The holders of preference shares must be entitled to a return of capital in preference to holders of ordinary shares when the Company is wound up. Transmission of Securities 42. (1) Where: (a) the Securities of the Company are listed on an Approved Market Place; and (b) the Company is exempted from compliance with Section 14 of the Central Depositories Act or Section 29 of the Securities Industry (Central Depositories) (Amendment) Act 1998, as the case may be, under the Rules of Depository in respect of such Securities, the Company shall, upon request of a Securities holder, permit a transmission of Securities held by such Securities holder from the register of holders maintained by the registrar of the Company in the jurisdiction of the Approved Market Place (hereinafter referred to as the Foreign Register), to the register of holders maintained by the registrar of the Company in Malaysia (hereinafter referred to as the Malaysian Register) subject to the following conditions: To be deleted To be deleted AMENDED PROVISIONS
Article 3(A)(1)
To be deleted
Article 42
Transmission of Securities 42. (1) Where: (a) the Securities of the Company are listed on another stock exchange; and (b) the Company is exempted from compliance with Section 14 of the Securities Industry (Central Depositories) Act 1991 or Section 29 of the Securities Industry (Central Depositories) (Amendment) Act 1998, as the case may be, under the Rules of Depository in respect of such Securities, the Company shall, upon request of a Securities holder, permit a transmission of Securities held by such Securities holder from the register of holders maintained by the registrar of the Company in the jurisdiction of the other stock exchange, to the register of holders maintained by the registrar of the Company in Malaysia and vice versa provided that there shall be no change in ownership of the Securities.
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Appendix I
PROPOSED AMENDMENTS TO THE ARTICLES OF ASSOCIATION OF THE COMPANY (CONTD) ARTICLE NO. EXISTING PROVISIONS (i) there shall be no change in ownership of the Securities; (ii) the transmission shall be executed by causing such shares or securities to be credited directly into the securities account of such Securities holder (as may be applicable). (2) For the avoidance of doubt, where the Company fulls the requirements of sub-paragraphs (a) and (b) of Article 42(1) above, it shall not allow any transmission of Securities from the Malaysian Register into the Foreign Register Article 71 (3) General Meeting Record of Depositors The Company shall request the Depository in accordance with the Rules of Depository, to issue a Record of Depositors as at a date not less than three (3) Market Days before the general meeting (hereinafter referred to as the General Meeting Record of Depositors) New Article 77 (5) To be deleted AMENDED PROVISIONS
General Meeting Record of Depositors The Company shall request the Depository in accordance with the Rules of Depository, to issue a Record of Depositors as at a latest date which is reasonably practicable which shall in any event be not less than three (3) Market Days before the general meeting (hereinafter referred to as the General Meeting Record of Depositors) New provision to be inserted immediately after Article 77 (4) Voting Rights on a Show of Hands On a resolution to be decided on a show of hands, a holder of ordinary shares or preference shares is personally present and entitled to vote shall be entitled to 1 vote.
Article 97
Directors All the Directors of the Company shall be natural persons and, until otherwise determined by the Company in general meeting, the number of Directors including a Managing Director shall not be less than two (2) but not more than twelve (12). Subject to the Listing Requirements, at least two (2) Directors or one third (1/3) of the Board of Directors, whichever is higher, shall be Independent Directors.
Directors Until otherwise determined by the Company in general meeting, the number of Directors including a Managing Director shall not be less than two (2) but not more than twelve (12). Subject to the Listing Requirements, at least two (2) Directors or one third (1/3) of the Board of Directors, whichever is higher, shall be Independent Directors.
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Directors Profile
CHEW TING LENG
Executive Chairman / Group Managing Director Mr. Chew Ting Leng, a Malaysian, aged 52, is one of the co-founders of the Group. He has more than 30 years experience in the PFF solutions industry. He was appointed as Group Managing Director and Executive Chairman of Pantech Group Holdings Berhad (PGHB) on 11 November 2006 and 13 November 2006 respectively. He is the Chairman of the Remuneration Committee. He does not hold any directorships in any other public companies. He has no family relationship with other directors or major shareholders of PGHB. He has no conict of interest with PGHB and has no convictions of offences other than trafc offences within the past ten years.
GOH TEOH KEAN

Group Deputy Managing Director Mr Goh Teoh Kean, a Malaysian, aged 51, graduated with Diploma in Commerce (Financial Accounting) from Tunku Abdul Rahman College. He has more than 19 years experience in the PFF solutions industry. He is one of the co-founders of the Group and was appointed as the Group Deputy Managing Director on 11 November 2006. He is responsible for the nancial and administrative functions of the Group. He is a member of the Audit Committee. He does not hold any directorships in any other public companies. He has no family relationship with other directors or major shareholders of PGHB. He has no conict of interest with PGHB and has no convictions of offences other than trafc offences within the past ten years.
TAN ANG ANG

Executive Director Mr Tan Ang Ang, a Malaysian, aged 50, was appointed as an Executive Director on 11 November 2006. He is also the Managing Director of Pantech Steel Industries Sdn Bhd. He obtained his professional Diploma from the Chartered Institute of Marketing in 1989. He is responsible for the overall operation and performance of the Groups manufacturing business. He is not a member of any board committee. He does not hold any directorships in any other public companies. He has no family relationship with other directors or major shareholders of PGHB. He has no conict of interest with PGHB and has no convictions of offences other than trafc offences within the past ten years.
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Directors Profile
TO TAI WAI
Executive Director Mr. To Tai Wai, a Malaysian, aged 35, was appointed as an Executive Director on 11 November 2006. He is primarily responsible for the domestic and international sales activities of the Groups trading division. He has been with Pantech Corporation Sdn Bhd since 1989. He is not a member of any board committee. He does not hold any directorships in any other public companies. He has no family relationship with other directors or major shareholders of PGHB. He has no conict of interest with PGHB and has no convictions of offences other than trafc offences within the past ten years.
ABDUL KARIM BIN AHMAD

Non-Independent Non-Executive Director Encik Abdul Karim Bin Ahmad, a Malaysian, aged 52, was appointed as a Non-Independent Non-Executive Director of PGHB on 30 November 2006 representing the interest of Koperasi Permodalan Felda Berhad (KPFB). He graduated with a Bachelor Degree in Economics (Honours) from University Kebangsaan Malaysia in 1978. He is presently the Regional General Manager for Felda Trolaks Regional Ofce in Perak. He is not a member of any board committee. He does not hold any directorships in any other public companies. He has no family relationship with other directors or major shareholders of PGHB. He has no conict of interest with PGHB and has no convictions of offences other than trafc offences within the past ten years.
TAN SUI HIN

Independent Non-Executive Director Mr Tan Sui Hin, a Malaysian, aged 56, was appointed as an Independent Non-Executive Director of PGHB on 30 November 2006. He graduated with a Diploma in Mechanical Engineering from Ungku Omar Polytechnic in 1971. He has more than 35 years experience in the building engineering eld. He is the Chairman of both the Audit and the Nomination Committee. He is also a member of the Remuneration Committee. He does not hold any directorships in any other public companies. He has no family relationship with other directors or major shareholders of PGHB. He has no conict of interest with PGHB and has no convictions of offences other than trafc offences within the past ten years.
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Directors Profile
LOH WEI TAK
Independent Non-Executive Director Mr Loh Wei Tak, a Malaysian, aged 33, was appointed as an Independent Non-Executive Director of PGHB on 30 November 2006. He is a qualied accountant and a member of the Malaysian Institute of Accountants. He completed his Bachelor of Business Degree (Majoring in Accounting) from Monash University, Melbourne, Australia in 1994 and obtained his status as a Certied Practicing Accountant from Australia in 1998. In 2000, he was admitted as a Chartered Accountant to the Malaysian Institute of Accountants prior to obtaining his status as a Certied Public Accountant from the Institute of Certied Public Accountants of Singapore in 2001. He is a member of the Audit and Nomination Committees. He does not hold any directorships in any other public companies. He has no family relationship with other directors or major shareholders of PGHB. He has no conict of interest with PGHB and has no convictions of offences other than trafc offences within the past ten years.
SAW SIEW EE
Independent Non-Executive Director Madam Saw Siew Ee, a Malaysian, aged 42, was appointed as an Independent Non-Executive Director of PGHB on 30 November 2006. She graduated from University of Keele in 1987 with a degree in Computer and Management Science. Upon her graduation, she began her career as an audit junior. In 1989, she returned to Malaysia and worked as a research analyst. She is a licensed Dealers Representative with CIMB Investment Bank Bhd since 1994. She is a member of the Remuneration and Nomination Committees. She does not hold any directorships in any other public companies. She has no family relationship with other directors or major shareholders of PGHB. She has no conict of interest with PGHB and has no convictions of offences other than trafc offences within the past ten years. The Company was granted listing on the Main Board of Bursa Malaysia Securities Berhad on 15 February 2007. No Board of Directors meeting was held for the nancial year ended 28 February 2007.
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Executive Chairmans Statement Rising to the challenge of a New Era

SMB Recognition Award Pantech Steel Industries Sdn Bhd Winner of Export Excellence Award 2006
Dear shareholders,
It is with great pleasure that the Board of Directors and I present this inaugural Annual Report and the audited nancial statements for the Financial Year ended 28 February 2007. The New Era dawned when Pantech Group was admitted to the Main Board of Bursa Malaysia Securities Berhad on 15 February 2007. As a public listed company, we have strengthened our resolve and commitment to increasing revenue and expanding market share, which are crucial to improving shareholder value. We certainly view our role as a public listed company very seriously and we intend to secure a loyal, long-term shareholder base to grow with us to greater heights. As the Executive Chairman of the Board, I am excited to share with you the progress and achievements Pantech Group has made over the years. Having been in business since 1987, Pantech Groups strength lies in the fact that we offer more than 20,000 product items based on various sizes, grades, types, category and brand names for various pipes, ttings, ow controls (PFF) solutions in our stable. Our income is derived from two main sources namely from our manufacturing and trading operations. In reviewing the past nancial year, it is clear that we have made very good progress in our manufacturing sector; and our order book is strong. We have added new countries to our export base, namely Mexico, India and Indonesia. Needless to say, these countries offer tremendous market potential for our range of PFF. Over 50% of the Groups sales currently come from oil & gasrelated customers. As more exploration and production works in the oil & gas sector are carried out, Pantech Group stands to benet from rising demand for PFF solutions. In anticipation of the increased demand for our PFF products, Pantech Group has earmarked approximately RM21 million over the next two years to increase our storage facilities and manufacturing production area, and to buy machinery and other equipment. This amount comprises RM12 million obtained from the IPO proceeds and RM9 million from internal funds. In line with this, I am excited to share that the construction has begun on a new factory in Klang and work is expected
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Executive Chairmans Statement

to be completed by second half year of 2007. This new plant will give us additional manufacturing capacity and support our objective of increased production and wider market penetration. We have also leased seven acres of land in Port Klang Free Zone to provide additional storage space.
Group Results
When we launched our IPO prospectus on 29 January 2007, we estimated the Groups proforma revenue for the Financial Year ending 28 February 2007 at RM216 million. I am pleased to inform shareholders that due to burgeoning oil and gas activities, our proforma group revenue this nancial year in review stood at RM243 million, exceeding our estimate by 12.5%. This increase is attributed mainly to new projects secured during the previous and current nancial years. In terms of product breakdown, our biggest contributor is pipes, making up approximately 58% of overall sales last nancial year. We were able to translate this higher revenue to a prot after tax of RM26.76 million, which exceeded our estimate by approximately 9.15%.
Business Outlook and Strategies
With high oil prices and as more exploration and production works in the oil & gas sector are carried out globally, Malaysia is expected to follow suit with both onshore and offshore developments progressing at a strong pace. According to a local research house, about RM16 billion was poured into exploration and production activities carried out, off Malaysian waters in 2006. According to the same report, as many as 65 to 70 platforms will be required in Malaysian waters over the next 5 years as development moves further offshore and towards deepwater. Pantech Group is well poised to take advantage of the opportunities offered via this continuing and growing demand for efcient means to transport the oil & gas. Our strength lies in our ability to supply PFF to our customers specications, while maintaining strict quality compliance with the specications of the international quality standards for oil and gas industries. We also use High Frequency Induction (HFI) technology in the manufacturing of some of our products, which makes us a market leader in Malaysia in these items. Ageing oil & gas platforms globally are also expected to create replacement demand for our products. The bio-diesel industry in Malaysia is another potential growth area for us; the number of bio-diesel licences approved has been increasing and more plants are expected to come on stream soon. Bearing in mind that pipes, ttings and ow control solutions and products will be utilized to set-up these bio-diesel plants, Pantech Group aims to tap this market as well. An additional growth driver is our business plan to widen the Groups product range. These new products, which include niche items that offer higher prot margins, will cater to the
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Executive Chairmans Statement

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

The Board of directors of the Company, whilst pursuing business growth to enhance shareholders and stakeholders value, is also committed to promote corporate social responsibilities as integral part of the Group. Pantech Group recognizes the importance of maintaining workplace safety and health as it has impact on all employees morale and productivity. In view of this, the Group has implemented Policy on Health and Safety at Work and Protection of the Environment at the manufacturing plant. The Policy generally prescribes guidelines mainly on the followings:1) To promote employees health and safety through provision of suitable protective equipment and appliances for employees use at their respective workplace. 2) Requiring contractors to abide to health and safety rules either on its premises or performing work on our behalf. The Board of Directors values the contribution from employees which attributes to the success of Pantech Group. The Group is committed towards providing a conductive and caring working environment for the employees. Various trainings are provided to motivate the employees and to upgrade their skills. The Group encourages active participation from all level of staff by constant organising in house and outdoor events such as family day. Through the organized programs, the Board of Directors has built a stronger bond with its employees and let the employees have a sense of belongings in the group.
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Audit Committee Report

The Audit Committee was formed by the Board of Directors on 1st December 2006. 1. COMPOSITION Chairman Mr. Tan Sui Hin (Independent Non- Executive Director) Members Mr. Loh Wei Tak (Independent Non- Executive Director) Mr. Goh Teoh Kean (Group Deputy Managing Director) 2. TERMS OF REFERENCE OF THE AUDIT COMMITTEE 2.1 Constitution The Audit Committee was formed pursuant to a resolution passed by the Board of Directors on 1st December 2006. 2.2 Membership The Audit Committee shall be appointed by the Board of Directors from among their members and shall comprise of not less than 3 members of whom a majority shall be independent non-executive directors. A quorum shall be 2 members. The members of the Audit Committee shall elect a chairman from among their members who is not an executive director or employees of the Company or any related corporation. The chairman elected shall be subjected to endorsement by the Board. If a member of the Audit Committee resigns, dies or for any other reason ceases to be a member with the results that the number is reduced below 3, the Board of Directors shall, within 3 months of that event, appoint such number of new members as may be required to make up the minimum number of 3 members. 2.3 Notice of Meeting and Attendance The agenda for Audit Committee meetings shall be circulated before each meeting to members of the Committee. The Committee may require the external auditors and any ofcial of the Company to attend any of its meetings as it determined. The external auditors shall have the right to appear and be heard at any meeting of the Audit Committee and shall appear before the Committee when required to do so by the Committee. The Company Secretary of the Company shall be the Secretary of the Committee. 2.4 Authority The Audit Committee is authorised to investigate any activity of the Company within its terms of reference and all employees shall be directed to co-operate with any request made by the Committee. The Committee shall be empowered to retain persons having special competence as necessary to assist the Committee in fullling its responsibilities.
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Audit Committee Report

2.5 Duties And Responsibilities The duties and responsibilities of the Audit Committee shall be: to consider the appointment of the external auditors, the audit fees and any question of resignation or dismissal; to oversee all matters pertaining to audit including the review of the audit plan and report; to discuss problems and reservations arising from the interim and nal results, and any matters the external auditors may wish to discuss (in the absence of management where necessary); to keep under review the effectiveness of internal control systems, and in particular review the external auditors management letter and managements response; and to consider other matters, act upon the Board of Directors request to investigate and report on any issues or concerns in regard to management of the Group, as dened.
SUMMARY OF ACTIVITIES DURING THE FINANCIAL YEAR There is no Audit Committee meeting held during the nancial year ending 28 February 2007 since the Company was listed on the 15 February 2007.
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Statement on Internal Control

The Malaysian Code on Corporate Governance stipulates that the Board of Directors of a listed company should maintain a sound system of internal control to safeguard shareholders investment and the Companys assets. The system of internal control covers not only nancial controls but operational and compliance controls as well. This Statement on Internal Control is made pursuant to paragraph 15.27 (b) of the Listing Requirements of Bursa Malaysia Securities Berhad. In addition, the Group has requested that the external auditors to review this Statement in accordance to paragraph 15.24 of the Listing Requirements and Recommended Practice Guide 5 (RPG 5) issued by the Malaysian Institute of Accountants. RPG 5 does not require the external auditors to form an opinion on the effectiveness of the Groups risk and control procedures or if this Statement covers all risks and controls. The Board is pleased to note that external auditors nd this Statement to be consistent with their understanding of the internal control processes implemented by the Group during their review. BOARD RESPONSIBILITY The Board acknowledges its responsibility for the Groups system of internal control and for reviewing adequacy and integrity of the system on an on-going basis. The system is designed to manage rather than eliminate the risk of failure to achieve business objectives, and can only provide reasonable but not absolute assurance against material misstatement, loss and fraud. The Board also takes into consideration the need to balance the business risks and the potential returns to stakeholders in its daily operations, with the dynamic business climate it operates in. The Board also recognises the need for a concerted effort from the management, head of department and senior staff members in ensuring that the integrity, effectiveness and adequacy of the control mechanism are monitored and maintained throughout the nancial period. ENTERPRISE RISK MANAGEMENT FRAMEWORK The Group plans to engage a professional rm to assist in establishing a formal risk management framework. The Board recognises the need for implementing an on-going process of identifying, evaluating, monitoring and managing signicant risks that may affect the Group in achieving its business objectives. KEY ELEMENTS OF THE GROUPS INTERNAL CONTROLS The Groups structured segregation of duties and reporting mechanism provides an effective monitoring tool and operational procedures in ensuring the followings: The Groups compliance to applicable laws and requirements The ability of senior managers and advisors to identify, manage and mitigate current or future events that may affect the Groups objectives, operations and long term plans. The internal control elements established by the Board with the management includes:1) The responsibilities of the Board and management are clearly dened to ensure the effective discharge of the roles and responsibilities. 2) The Management reports to the Board on material ndings and/or variances, if any, and the Board will review their implications to the Group and advise accordingly. 3) Management meetings are attended by senior management personnel at regular intervals to specically address operational issues, budgets, performance, business review/ planning and control management. 4) Key personnel from respective subsidiary companies provide monthly reports to the corporate ofce on the subsidiaries performance, compliance and strategic plans. 5) To ensure subsidiary companies, business units, divisions and employees are working coherently to achieve the Groups overall business objectives, corporate policies and procedures of the Group are clearly documented and also disseminated through internal memorandums, staff briengs and operational meetings.
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Statement on Internal Control

6) Close and active involvement of the Executive Directors in the day-to-day business operations of the Group. Presently, the Group does not have an in-house internal audit department. The Group plans to engage a professional rm to carry out internal audit for the Group. Internal audit charter and plan will be submitted to the Audit Committee for approval prior to the commencement of internal audit. INTERNAL CONTROL SUMMARY The Group continuously evaluates and improves on its control dynamism in ensuring its effectiveness and relevance in preserving the Groups interest and assets. The Board is of the opinion that the internal control system in place is adequate at its current level of operations and will continue to review this system going forward. There is no material internal control failures occurred during the nancial period that could have resulted in material losses or contingencies.
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Corporate Governance Statement

The Board of Directors (the Board) of Pantech Group Holdings Berhad supports the objectives of the Malaysian Code on Corporate Governance (the Code) and also acknowledges their roles in ensuring that shareholders interest are properly looked after. For this reason, the Board of Directors is committed in maintaining highest standard of corporate governance pursuant to the Code. The Group will continue to endeavor to comply with all the key Principles and Best Practices of the Malaysian Code on Corporate Governance in its effort to maintain shareholders value, whilst taking into account the interest of other stakeholders. This Corporate Governance Statement contained the principles and practices of the Code that the Group has adhered to. A. BOARD OF DIRECTORS i. The Board of Directors The Group is lead by an effective Board which controls the activities of the Group. The Board has overall responsibility for corporate governance, strategic planning, formulation of policies and overseeing the investments and business of the Company. Meetings The Company was granted listing on the Main Board of Bursa Malaysia Securities Berhad on 15 February 2007. There was no Board of Directors Meeting being held for the nancial year ending 28 February 2007. Board Balance The Board currently consists of eight (8) members, comprising of an Executive Chairman who is also the Group Managing Director, one (1) Group Deputy Managing Director, two (2) Executive Directors and four (4) non-executive directors. The Board of Directors has complied with the Best Practices in Corporate Governance except that the Chairman also holds an Executive position as Group Managing Director. Although of combined roles, the Board is of the opinion that there is a balanced view at all deliberations due to the presence of at least 1/3 Independent non-executive Directors who are unbiased and provide independent views, advice and judgment in compliance with Paragraph 15.02 of the Bursa Securities Listing Requirements. Although all the Directors have an equal responsibility for the Companys operations, the presence of Independent Non-Executive Directors brings and additional element of balance to the Board. Besides providing valuable nancial and business inputs, these Independent Directors have the caliber to exert inuence in the Boards decision. iv. Appointment and Re-election of Directors According to the Articles of Association of the Company, one-third (or the number nearest to onethird) of the Directors are required to retire from ofce at each annual general meeting. Further, all the Directors are required to retire from ofce at least once in every three (3) years. However, a retiring Director is eligible for re-election at the meeting at which he or she retires. An election of the retiring Directors shall take place every year. Any person appointed as a Director, either to ll a casual vacancy or as an addition to the existing Directors shall hold ofce only until the conclusion of the next annual general meeting, and shall be eligible for re-election but shall not be taken into account in determining the Directors who are to retire by rotation at that meeting. v. Directors Training All the Directors of the Company have attended the Mandatory Accreditation Programme conducted by Bursatra Sdn Bhd (Formerly known as Bursa Malaysia Training Sdn Bhd) within the stipulated timeframe as prescribed in the Listing Requirements.
ii.
iii.
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v. Directors Training (contd) The Board of Directors is aware of the importance of continuous education programme to enhance and safeguard shareholders value. The Board will attend some relevant seminars/ training programme deemed appropriate for the Directors. vi. Supply of Information The Board members are updated on the Companys activities and its operations on a regular basis. All Directors have access to all information of the Company on a timely basis in an appropriate form and quality necessary to enable them to discharge their duties and responsibilities. All Directors have access to the advice and services of the Company Secretary and to obtain independent professional advice, whenever necessary, at the expense of the Company. B. DIRECTORS REMUNERATION i. The Level and Make-Up of Remuneration The aggregate Directors remuneration for the nancial year ended 28 February 2007 are set out below: Remuneration (RM) 866,596 25,500 892,096
Executive Directors Non-Executive Directors Total
The remuneration paid to the Directors, analysed in the following bands, is as below:Range of Remuneration (RM) 50,000 and below 100,001 150,000 150,001 200,000 200,001 250,000 300,001 350,000 Executive 1 1 1 1 Non-Executive 4 -
There is no service contract made between any Director and the Company or its subsidiary companies. ii Procedure The Remuneration Committee is responsible for, among others, recommending to the Board the remuneration of all of the Executive Directors in all its forms, by referring to the KPI and market survey as necessary. In the event an Executive Director is a member of the Remuneration Committee, then he or she would not be part of the decision making process to arrive at his or her own remuneration. The determination of remuneration packages of non-executive directors would be a matter for the Board as a whole. Nonetheless, the individuals concerned would abstain from discussion of their own respective remuneration. The Remuneration Committee shall ensure that the levels of remuneration are sufcient to attract and retain Directors of the quality required to manage the business of the Group. The Remuneration Committee is entrusted under its terms of reference to assist the Board. In the case of non-executive directors, the level of remuneration shall reect the experience and level of responsibilities undertaken by the non-executive directors concerned.
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As the Remuneration Committee was recently established, it will be undertaking its full roles and responsibilities in the upcoming nancial year. The members of the Remuneration Committee are listed below:Chairman Chew Ting Leng (Executive Chairman/Group Managing Director) Members Tan Sui Hin (Independent Non-Executive Director) Saw Siew Ee (Independent Non-Executive Director) C. SHAREHOLDERS i. Dialogue with Investors The Board recognizes the values of the dialogue with investors and shareholders and the importance of accountability to them. As such, the Board is disseminating proper, timely and adequate information to the investors and shareholders through annual report, announcements, circulars to shareholders and press release. General Meetings The Companys Annual General Meeting (AGM) serves as a principal forum for dialogue with shareholders. Shareholders are encouraged to meet and communicate with the Board at the AGM and to vote on all resolutions. Extraordinary General Meeting is held as and when required.
ii.
D.
ACCOUNTABILITY AND AUDIT i. Financial Reporting The Directors are responsible to present a true and fair assessment of the Groups position and prospects in the annual reports and quarterly reports. The quarterly nancial results were reviewed by the Audit Committee and approved by the Board of Directors prior to submission to Bursa Malaysia Securities Berhad. A statement by the Directors of their responsibilities in the preparation of nancial statements is set out in the ensuing section. ii. Statement of Directors Responsibility for Preparing Financial Statements The Board is responsible to ensure that the nancial statements are properly drawn up in accordance with the provisions of the Companies Act 1965 and approved accounting standards in Malaysia so as to give a true and fair view of the state of affairs of the Group as at the end of the nancial year and of the results and cash ows of the Group for the nancial year then ended. The matter will be further enhanced in the forthcoming year. The Directors are satised that in preparing the nancial statements of the Group for the year ended 28 February 2007, the Group has adopted suitable accounting policies and applied them consistently, prudently and reasonably. The Directors also consider that all applicable approved accounting standards have been followed in the preparation of the nancial statements, subject to any material departures being disclosed and explained in the notes to the nancial statements. The nancial statements have been prepared on the going concern basis. The Directors are responsible for ensuring that the Group keeps sufcient accounting records to disclose with reasonable accuracy, the nancial position of the Group and which enable them to ensure that the nancial statements comply with the Companies Act, 1965.
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iii. Internal Control As the Company was only listed on 15 February 2007, the Company has not set up the internal audit department for the nancial year ending 28 February 2007. The Board is aware on the importance of maintaining a sound internal control system that provides reasonable assurance of effective and efcient operations and compliance with internal procedures and guidelines. The Board has an overall responsibility to have a sound internal control system. iv. Relationship with the Auditors The Board has established a formal and transparent arrangement for maintaining appropriate relationships with the external auditors in seeking professional advice and ensuring the compliance with the appropriate accounting standards. The Audit Committee met with the external auditors to discuss their audit plan, audit ndings and the nancial statements. v. Compliance Statement The Company is committed in achieving high standards of corporate governance throughout the Group and to the highest level of integrity and ethical standards in all its business dealings. The Board considers that the Company has complied with the principles and best practices as set out in parts 1 and 2 respectively of the Code. vi. Directors Responsibility Statement on Annual Audited Accounts The Directors are required by the Companies Act, 1965 to prepare nancial statements for each nancial year which are made in accordance with the applicable approved accounting standards in Malaysia and to give a true and fair view of the state of affairs of the Company and of the Group as at the end of each nancial year and of the result and cash ows of the Company and of the Group for the nancial year end.
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Additional Compliance Statement

1. UTILISATION OF PROCEEDS FROM CORPORATE EXERCISE (a) Initial Public Offering On 15 February 2007, the entire enlarged issued and paid-up share capital of the Company, comprising 150,000,000 ordinary shares of RM0.50 each were listed on the Main Board of Bursa Securities. Utilisation of IPO Proceeds Proposed Utilisation Purpose Capital Expenditure Working Capital Listing expenses RM000 12,000 9,100 2,500 23,600 Actual Utilisation 28-02-2007 RM000 9,100 2,360 11,460 Balance RM000 12,000 140 12,140
(b)
2. 3. 4. 5.
SHARE BUY-BACK There were no share buy-back arrangements during the nancial year. OPTIONS, WARRANTS OR CONVERTIBLE SECURITIES There were no options, warrants or convertible securities exercised in respect of the nancial year. AMERICAN DEPOSITORY RECEIPT (ADR) /GLOBAL DEPOSITORY RECEIPT (GDR) The Company did not sponsor any ADR or GDR programmes during the nancial year. IMPOSITION OF SANCTIONS / PENALTIES There were no public impositions of sanctions or penalties imposed on the Company and its subsidiaries, directors or management by the regulatory bodies during the nancial year. NON-AUDIT FEES The amount of non-audit fees incurred for services rendered to the Company and its subsidiaries during the nancial year ended 28 February 2007 by Shamsir Jasani Grant Thornton was RM167,800. VARIANCE IN PROFIT ESTIMATE, FORECAST OR PROJECTION The variance between the actual audited and forecast prot after tax for the nancial statement ended 28 February 2007 was below 10% VARIANCE IN RESULTS There is no signicant variance between the prot after taxation for the nancial year and the Fourth Quarter unaudited results announced by the Company. PROFIT GUARANTEE The Company did not give any form of prot guarantee to any parties during the nancial year. MATERIAL CONTRACTS AND CONTRACTS RELATING TO LOANS There were no contracts relating to loan and material contracts of the Company and its subsidiaries involving the Directors and substantial shareholders since the end of the previous nancial year. RECURRENT RELATED PARTY TRANSACTIONS OF A REVENUE AND TRADING NATURE There is no Recurrent Related Party Transactions entered during the nancial year. REVALUATION POLICY ON LANDED PROPERTIES There were revaluation policies on landed properties adopted by the Group during the nancial year under review. Please refer to Notes 3(e) to the Financial Statement on page 46.
6.
7.
8.
9. 10.
11. 12.
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Financial Statements
Directors Report Statement by Directors and Statutory Declaration Report of the Auditors Balance Sheets Income Statements Statements of Changes in Equity Cash Flow Statements Notes to the Financial Statements 26-30
31 32-33 34-35 36 37 38-40 41-72
DIRECTORS REPORT
The Directors of Pantech Group Holdings Berhad have pleasure in submitting their report together with the audited nancial statements of the Group and of the Company for the nancial period from 15 May 2006 (date of incorporation) to 28 February 2007.
PRINCIPAL ACTIVITIES The Company is principally engaged in investment holding and provision of management services. The principal activities of the subsidiary companies, associate company and joint venture are disclosed in Notes 11, 12 and 13 to the Financial Statements respectively. There have been no signicant changes in the nature of these activities of the Company, its subsidiary companies, associate company and joint venture during the nancial period.
FINANCIAL RESULTS Group RM Net prot for the nancial period Attributable to:Equity holders of the Company 26,757,866 Company RM 3,634,118
26,757,866
3,634,118
DIVIDENDS There were no dividends paid or declared by the Company since the date of its incorporation. At the forthcoming Annual General Meeting, a nal dividend, in respect of the nancial period ended 28 February 2007, of 3 sen less 27% income tax per ordinary share on 150,000,000 ordinary shares amounting to a dividend payable of RM3,285,000 will be proposed for shareholders approval. The nancial statements for current nancial period do not reect 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 28 February 2008.
RESERVES AND PROVISIONS There were no material transfers to or from reserves or provisions during the nancial period other than those disclosed in the nancial statements.
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DIRECTORS REPORT
ISSUE OF SHARES AND DEBENTURES During the nancial period, the following shares were issued:Date of issue Class of shares Par value RM 0.50 0.50 0.50 0.50 0.50 0.50 Number of shares Purpose of issue
15.5.2006 7.11.2006 8.11.2006 10.11.2006 18.12.2006 15.2.2007
Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary
2 119,735,047 4,751,715 513,236 5,000,000 20,000,000
Subscribers share Acquisition of subsidiary companies Acquisition of subsidiary company Acquisition of subsidiary company Rights issue Public issue
There were no debentures issued during the nancial period.
INFORMATION ON THE FINANCIAL STATEMENTS Before the nancial statements of the Group and of the Company were made out, the Directors took reasonable steps:(a) to ascertain that action had been taken in relation to the writing off of bad debts and the making of allowance for doubtful debts and satised themselves that no bad debts to be written off and adequate allowance had been made for doubtful debts; and to ensure that any current assets which were unlikely to be realised in the ordinary course of business including their values as shown in the accounting records of the Group and of the Company have been written down to an amount which they might be expected so to realise.
(b)
At the date of this report, the Directors are not aware of any circumstances:(a) which would render it necessary to write off any bad debts or the amount of allowance for doubtful debts in the nancial statements of the Group and of the Company inadequate to any substantial extent; or which would render the values attributed to current assets in the nancial statements of the Group and of the Company misleading; or which have arisen which render adherence to the existing method of valuation of assets or liabilities of the Group and of the Company misleading or inappropriate.
(b)
(c)
No contingent or other liability has become enforceable or is likely to become enforceable within the period of twelve months after the end of the nancial period which, in the opinion of the Directors, will or may affect the ability of the Group and of the Company to meet its obligations as and when they fall due. At the date of this report, there does not exist:(a) any charge on the assets of the Group and of the Company which has arisen since the end of the nancial period which secures the liability of any other person; or any contingent liability of the Group and of the Company which has arisen since the end of the nancial period.
(b)
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DIRECTORS REPORT
OTHER STATUTORY INFORMATION The Directors state that:At the date of this report, they are not aware of any circumstances not otherwise dealt with in this report or the nancial statements which would render any amount stated in the nancial statements misleading. In the opinion of the Directors:(a) the results of operations of the Group and of the Company during the nancial period were not substantially affected by any item, transaction or event of a material and unusual nature except for the effects arising from the adoption of new and revised Financial Reporting Standards (FRS) as disclosed in Note 3(b) to the Financial Statements; and there has not arisen in the interval between the end of the nancial period and the date of this report any item, transaction or event of a material and unusual nature likely to affect substantially the results of operations of the Group and of the Company for the current nancial period in which this report is made.
(b)
SIGNIFICANT EVENTS DURING THE FINANCIAL PERIOD Signicant events during the nancial period are disclosed in Note 31 to the Financial Statements.
SIGNIFICANT EVENT SUBSEQUENT TO THE BALANCE SHEET DATE Signicant event subsequent to the balance sheet date is disclosed in Note 32 to the Financial Statements.
DIRECTORS OF THE COMPANY The Directors in ofce since the date of incorporation are:Chew Ting Leng (appointed as Executive Chairman on 13.11.2006/Group Managing Director on 11.11.2006) Goh Teoh Kean (appointed as Group Deputy Managing Director on 11.11.2006) To Tai Wai (appointed as Executive Director on 11.11.2006) Tan Ang Ang (appointed as Executive Director on 11.11.2006) Abdul Karim Bin Ahmad (appointed as Non Independent Non-Executive Director on 30.11.2006) Tan Sui Hin (appointed as Independent Non-Executive Director on 30.11.2006) Saw Siew Ee (appointed as Independent Non-Executive Director on 30.11.2006) Loh Wei Tak (appointed as Independent Non-Executive Director on 30.11.2006) Liang Siew Ching (First Director and resigned on 12.11.2006) Yusanida Bte Mohd Nor (First Director and resigned on 12.11.2006) According to the Register of Directors Shareholdings, the benecial interests of those who were Directors at the end of the nancial period in the shares of the Company are as follows:Ordinary shares of RM0.50 each As at 15.5.2006 Chew Ting Leng - deemed interest Bought Sold As at 28.2.2007
43,564,301
7,070,101
36,494,200
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DIRECTORS REPORT
DIRECTORS OF THE COMPANY (CONTD) Ordinary shares of RM0.50 each As at 15.5.2006 Goh Teoh Kean - deemed interest To Tai Wai - direct interest Tan Ang Ang - direct interest Abdul Karim Bin Ahmad - direct interest Tan Sui Hin - direct interest Saw Siew Ee - direct interest Loh Wei Tak - direct interest Bought Sold As at 28.2.2007
30,222,496
4,907,096
25,315,400
5,586,053
894,953
4,691,100
4,026,200
4,026,200
30,000
30,000
30,000
30,000
30,000
30,000
30,000
30,000
By virtue of Mr. Chew Ting Leng, Mr. Goh Teoh Kean, Mr. To Tai Wai and Mr. Tan Ang Angs direct and indirect interest in the Company, they are also deemed to have interest in the shares of all the subsidiary companies to the extent that the Company has an interest under Section 6A of the Companies Act, 1965.
DIRECTORS BENEFITS During and at the end of the nancial period, no arrangements subsisted to which the Company is a party, with the object or objects of enabling the Directors of the Company to acquire any benets by means of the acquisition of shares in the Company or any other body corporate. Since the date of its incorporation, no Director has received or become entitled to receive any benet (other than as disclosed in the Notes 24 and 28 to the Financial Statements) by reason of a contract made by the Company or a related corporation with the Director or with a rm of which he is a member, or with a company in which he has a substantial nancial interest.
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DIRECTORS REPORT
AUDITORS Messrs Shamsir Jasani Grant Thornton have expressed their willingness to continue in ofce. Signed on behalf of the Board of Directors in accordance with a resolution of the Directors dated 25 May 2007.
................................................... CHEW TING LENG
.................................................... GOH TEOH KEAN
) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )
DIRECTORS
Johor Bahru 25 May 2007
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STATEMENT BY DIRECTORS/ STATUTORY DECLARATION

STATEMENT BY DIRECTORS
In the opinion of the Directors, the nancial statements set out on pages 34 to 72 are drawn up in accordance with the provisions of the Companies Act, 1965 and applicable MASB Approved Accounting Standards in Malaysia for Entities Other Than Private Entities so as to give a true and fair view of the state of affairs of the Group and of the Company as at 28 February 2007, results of operations and cash ows of the Group and of the Company for the nancial period from 15 May 2006 (date of incorporation) to 28 February 2007.
On behalf of the Board
............................................................... CHEW TING LENG
........................................................... GOH TEOH KEAN
Johor Bahru 25 May 2007
STATUTORY DECLARATION I, Wang Woon Chin, being the Ofcer primarily responsible for the nancial management of Pantech Group Holdings Berhad, do solemnly and sincerely declare that to the best of my knowledge and belief, the nancial statements set out on pages 34 to 72 are correct and I make this solemn declaration conscientiously believing the same to be true and by virtue of the provisions of the Statutory Declarations Act, 1960. Subscribed and solemnly declared by the abovenamed at Johor Bahru in the State of Johor this day of 25 May 2007 ) ) ) )
............................................................ WANG WOON CHIN
Before me: Rusly B. Mohd Yunus P.I.S Commissioner for Oaths Johor Bahru
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REPORT OF THE AUDITORS

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

TO THE MEMBERS OF PANTECH GROUP HOLDINGS BERHAD (Incorporated in Malaysia)
We have considered the nancial statements and the auditors report of the subsidiary company of which we have not acted as auditors, as disclosed in Note 11 to the Financial Statements. We are satised that the nancial statements of the subsidiary companies that have been consolidated with the Companys nancial statements 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 subsidiary companies were not subject to any qualication and in respect of subsidiary companies incorporated in Malaysia, did not include any comment (or any adverse comment) made under Section 174 (3) of the Act.
SHAMSIR JASANI GRANT THORNTON (NO. AF : 0737) CHARTERED ACCOUNTANTS
DATO N.K. JASANI CHARTERED ACCOUNTANT (NO: 708/03/08(J/PH)) PARTNER Johor Bahru 25 May 2007
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BALANCE SHEETS
AS AT 28 FEBRUARY 2007
Group 28.2.2007 RM 75,000,000 16,067,022 13,999 26,757,866 117,838,887 Company 28.2.2007 RM 75,000,000 16,067,022 3,634,118 94,701,140
Note
SHARE CAPITAL SHARE PREMIUM EXCHANGE RESERVE UNAPPROPRIATED PROFIT Equity attributable to equity holders of the Company / Total equity NON-CURRENT LIABILITIES Finance creditors Borrowings Deferred taxation
6 7 8
2,297,768 25,643,470 2,217,404 147,997,529
94,701,140
REPRESENTED BY:NON-CURRENT ASSETS Property, plant and equipment Investment properties Investment in subsidiary companies Investment in an associate company Investment in a joint venture company Other investments Deferred tax assets Total non-current assets CURRENT ASSETS Inventories Trade receivables Other receivables Amount due from subsidiary companies Amount due from an associate company Tax recoverable Fixed deposits with licensed banks Cash and bank balances Total current assets
9 10 11 12 13 14 15
26,667,031 13,086,666 40,200 121,923 2,006,900 901,195 42,823,915
72,271,435 72,271,435
16 17 18 11 12 19
98,265,374 63,908,560 2,502,636 229,460 130,044 23,131,535 9,736,175 197,903,784
59,217 3,729,444 12,000,000 7,026,608 22,815,269
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BALANCE SHEETS
AS AT 28 FEBRUARY 2007 (CONTD)
Group 28.2.2007 RM Company 28.2.2007 RM
Note
LESS: CURRENT LIABILITIES Trade payables Other payables Amount due to subsidiary companies Amount due to an associate company Amount due to a joint venture company Borrowings Bank overdrafts Tax payable Total current liabilities NET CURRENT ASSETS
20 21 11 12 13 7 22
13,813,548 2,644,070 2,236 22,652 73,370,379 1,239,477 1,637,808 92,730,170 105,173,614 147,997,529
290,792 28,536 2,236 64,000 385,564 22,429,705 94,701,140
The accompanying notes form an integral part of the nancial statements.
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INCOME STATEMENTS
FOR THE FINANCIAL PERIOD FROM 15 MAY 2006 (DATE OF INCORPORATION) TO 28 FEBRUARY 2007
Group 15.5.2006 to 28.2.2007 RM 90,584,227 (67,917,186) 22,667,041 502,378 17,829,910 (2,401,370) (4,283,684) (3,839,263) 30,475,012 (2,088,573) 13,983 (38,517) 24 25 28,361,905 (1,604,039) 26,757,866 Company 15.5.2006 to 28.2.2007 RM 5,148,554 5,148,554 8,836 (164,742) 4,992,648 4,992,648 (1,358,530) 3,634,118
Note
Revenue Cost of sales Gross prot Other income Excess of net fair value over acquisition costs Selling and distribution expenses Administration expenses Other expenses Prot from operations Finance costs Share of prot in associate company Share of loss in joint venture company Prot before taxation Taxation Net prot for the nancial period
23
Attributable to:Equity holders of the Company Earnings per share attributable to equity holders of the Company Earnings per 50 sen share - Basic (sen) Proposed Dividends per 50 sen share - gross (sen) - net (sen)
26,757,866
3,634,118
26
65.60
3.00 2.19
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STATEMENTS OF CHANGES IN EQUITY

Attributable to equity holders of the Company Non-distributable Distributable Share Share Exchange Unappropriated capital premium reserve prot RM RM RM RM Group At date of incorporation Issuance of share capital pursuant to acquisition of subsidiary companies Issuance of share capital pursuant to Rights Issue Issuance of share capital pursuant to Public Issue Listing expenses Currency translation differences Net prot for the nancial period Balance at 28 February 2007 1 1
Total equity RM
62,499,999
4,826,687
67,326,686
2,500,000
2,500,000
10,000,000 -
13,600,000 (2,359,665)
23,600,000 (2,359,665)
13,999
13,999
75,000,000
16,067,022
13,999
26,757,866 26,757,866
26,757,866 117,838,887
Share capital RM Company At date of incorporation Issuance of share capital pursuant to acquisition of subsidiary companies Issuance of share capital pursuant to Rights Issue Issuance of share capital pursuant to Public Issue Listing expenses Net prot for the nancial period Balance at 28 February 2007
Non-distributable Distributable Share Unappropriated premium prot RM RM
Total RM
62,499,999
4,826,687
67,326,686
2,500,000
2,500,000
10,000,000 75,000,000
13,600,000 (2,359,665) 16,067,022
3,634,118 3,634,118
23,600,000 (2,359,665) 3,634,118 94,701,140
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CASH FLOW STATEMENTS

Group 15.5.2006 to 28.2.2007 RM Company 15.5.2006 to 28.2.2007 RM
Note
CASH FLOWS FROM OPERATING ACTIVITIES Prot before taxation Adjustments for:Allowance for doubtful debts Allowance for slow moving inventories Depreciation of property, plant and equipment Interest expenses Interest income Excess of net fair value over acquisition costs Share of loss in joint venture company Share of prot in associate company Dividend income Gain on disposal of property, plant and equipment Unrealised loss in foreign exchange Operating prot before working capital changes Inventories Receivables Payables Subsidiary companies Associate company Joint venture Bills payables Cash used in operations Dividend received Interest received Interest paid Tax paid Net cash (used in)/generated from operating activities CASH FLOW FROM INVESTING ACTIVITIES Purchase of property, plant and equipment Proceeds from sale of property, plant and equipment Investment in subsidiary companies Acquisition of subsidiary companies, net of cash acquired Net cash generated from/(used in) investing activities
28,361,905
4,992,648
242,957 2,767,490 891,652 2,033,021 (189,877) (17,829,910) 38,517 (13,983) (1,066) 220,595 16,521,301 (17,506,134) (15,109,715) (1,026,991) (368,466) 38,696 11,784,665 (5,666,644) 189,877 (2,033,021) (747,732) (8,257,520)
(8,836) (4,794,554) 189,258 (59,217) 290,792 (3,700,908) 2,236 (3,277,839) 3,500,024 8,836 231,021
(468,135) 3,959 17,688,265 17,224,089
(4,944,749) (4,944,749)
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FOR THE FINANCIAL PERIOD FROM 15 MAY 2006 (DATE OF INCORPORATION) TO 28 FEBRUARY 2007 (CONTD)
Group 15.5.2006 to 28.2.2007 RM Company 15.5.2006 to 28.2.2007 RM
Note
CASH FLOW FROM FINANCING ACTIVITIES Proceeds from issuance of share capital Payment of listing expenses Repayment of hire purchase and nance lease creditors Repayment of borrowings Net cash generated from nancing activities CASH AND CASH EQUIVALENTS Net change Effect of exchange rate changes Carried forward NOTES TO THE CASH FLOW STATEMENTS C
26,100,001 (2,359,665) (499,211) (593,460) 22,647,665
26,100,001 (2,359,665) 23,740,336
31,614,234 13,999 31,628,233
19,026,608 19,026,608
A.
PURCHASE OF PROPERTY, PLANT AND EQUIPMENT The Group acquired property, plant and equipment with an aggregate cost of RM1,290,165 of which RM822,030 was acquired by means of hire purchase. Cash payments of RM468,135 were made to purchase the property, plant and equipment.
B.
ACQUISITION OF SUBSIDIARY COMPANIES The fair value of assets acquired and liabilities assumed of the subsidiary companies acquired during the nancial period were as follows:Group 15.5.2006 to 28.2.2007 RM Property, plant and equipment Investment properties Other investments Investment in subsidiary companies Investment in associate company Investment in joint venture company Deferred tax assets Inventories Trade and other receivables Less: Allowance for doubtful debts Amount due from subsidiary companies Amount due from related companies 26,271,411 13,086,666 2,006,900 4,061,642 26,217 160,440 79,000 83,526,730 51,932,101 (290,698) 51,641,403 3,760,612 134,538
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FOR THE FINANCIAL PERIOD FROM 15 MAY 2006 (DATE OF INCORPORATION) TO 28 FEBRUARY 2007 (CONTD)
B. ACQUISITION OF SUBSIDIARY COMPANIES (CONTD) Group 15.5.2006 to 28.2.2007 RM Amount due from joint venture company Fixed deposits with licensed banks Cash and bank balances Trade and other payables Amount due to holding company Amount due to associate company Bank overdrafts Finance creditors Term loans Borrowings Tax payable Deferred taxation Net assets acquired Less: Excees of net fair value over acquisition costs Cost of investments Less: Non-cash purchase consideration Companys cash outows on acquisition paid to subsidiary companies Cash and cash equivalents acquired - Fixed deposits with licensed banks - Cash and bank balances - Bank overdrafts Groups cash inows on acqusition, net of cash and cash equivalents acquired 20,018,750 1,159,990 (3,490,475) 16,044 20,018,750 1,159,990 (16,381,893) (3,301,231) (141,242) (3,490,475) (2,954,035) (8,159,505) (79,663,139) (759,278) (998,200) 90,101,345 (17,829,910) 72,271,435 67,326,686 (4,944,749)
17,688,265
C.
CASH AND CASH EQUIVALENTS Cash and cash equivalents included in the cash ow statements comprise the following balance sheet amounts:Group Company 15.5.2006 15.5.2006 to to 28.2.2007 28.2.2007 RM RM Cash and bank balances Fixed deposits with licensed banks Bank overdrafts 9,736,175 23,131,535 (1,239,477) 31,628,233 7,026,608 12,000,000 19,026,608
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NOTES TO THE FINANCIAL STATEMENTS - 28 FEBRUARY 2007

1. BASIS OF PREPARATION OF THE FINANCIAL STATEMENTS The nancial statements of the Group and of the Company have been prepared in accordance with the provisions of the Companies Act, 1965 and applicable MASB Approved Accounting Standards in Malaysia for Entities Other Than Private Entities.
2.
FINANCIAL RISK MANAGEMENT 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 risks. The Group operates within policies that are approved by the Board and the Groups policy is not to engage in speculative transactions. The main areas of nancial risks faced by the Group and the policy in respect of the major areas of treasury activity are set out as follows:(a) Foreign currency risk The Group is exposed to foreign currency risk as a result of its normal operating activities, both external and intra-Group, where the currency denomination differs from the local currency, Ringgit Malaysia (RM). The Groups policy is to minimise the exposure of overseas operating activities to transaction risk by matching local currency income against local currency costs. (b) Interest rate risk The Groups exposure to changes in interest rates relates primarily to the Groups short term deposits with licensed nancial institution and nancing through bank borrowings. The Group ensures that it obtains borrowings at competitive interest rates under the most favourable terms and conditions. The Group does not use derivate nancial instruments to hedge its risks. (c) Credit risk The Group is exposed to credit risk mainly from trade and other receivables. The risk is managed through the application of credit approvals, credit limits and monitoring procedures. Credit is extended to the customers based upon careful evaluation of the customers nancial condition and credit history. Surplus funds are placed with licensed nancial institutions to minimise the risk that the counterparties will fail in performing their obligation. The maximum credit risk exposure of the Group, without taking into account the fair value of collaterals, is represented by the carrying amount of the trade and other receivables as shown in the balance sheet. The Group is not exposed to signicant concentration of credit risk. (d) Market risk The Groups principal exposures to market risk arises mainly from the changes in equity prices. Equity interests classied as current assets are available for sale and the Group manages disposal of its interests to optimise returns on realisation. (e) Liquidity and cash ow risks The Group maintains a prudent liquidity risk management policy by maintaining adequate cash. The Group also periodically evaluates its cash ow requirements and where deemed necessary, based on estimates of future needs, establishes credit lines with licensed nancial institutions in Malaysia.
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3. SIGNIFICANT ACCOUNTING POLICIES (a) Accounting convention The nancial statements of the Group and of the Company are prepared under the historical cost convention, unless otherwise indicated in the other signicant accounting policies. The functional currency of the Company is Ringgit Malaysia (RM). (b) Adoption of Financial Reporting Standards (FRS) The following applicable FRSs have been adopted by the Group and the Company effective for nancial period beginning on or after 15 May 2006:FRS 3 FRS 101 FRS 102 FRS 1072004 FRS 108 FRS 110 FRS 1122004 FRS 1142004 FRS 116 FRS 1182004 FRS 1192004 FRS 121 FRS 1232004 FRS 127 FRS 128 FRS 131 FRS 132 FRS 133 FRS 1342004 FRS 136 FRS 1372004 FRS 138 FRS 140 Business Combinations Presentation of Financial Statements Inventories Cash Flow Statements Accounting Policies, Changes in Accounting Estimates and Errors Events After the Balance Sheet Date Income Taxes Segment reporting Property, Plant and Equipment Revenue Employee Benets The Effect of Changes in Foreign Exchange Rates Borrowing Costs Consolidated and Separate Financial Statements Investment in Associates Interests in Joint Ventures Financial Instruments : Disclosure and Presentation Earning Per Share Interim Financial Reporting Impairment of Assets Provisions, Contingent Liabilities and Contingent Assets Intangible Assets Investment Property
The adoption of FRS 102, 1072004, 108, 110, 1122004, 1142004, 116, 1182004, 1192004, 1232004, 127, 128, 131, 132, 133, 1342004, and 1372004 do not have signicant nancial impact on the Group and the Company. The principal effects in accounting policies resulting from the adoption of the other FRSs are as follows:FRS 3: Business Combinations and FRS 138: Intangible Assets Under FRS 3, any excess of the Groups interest in the net fair value of acquirees identiable assets, liabilities and contingent liabilities over cost of acquisitions (previously referred to as negative goodwill), after reassessment, is recognised immediately as income.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (b) Adoption of Financial Reporting Standards (FRS) (Contd) FRS 101: Presentation of Financial Statements The adoption of the revised FRS 101 has affected the presentation of minority interest, share of net after-tax results of associates and other disclosures. In the consolidated balance sheet, minority interests are now presented within total equity. In the consolidated income statement, minority interests are presented as an allocation of the total prot or loss for the period. A similar requirement is also applicable to the statement of changes in equity. FRS 101 also requires disclosure, on the face of the statement of changes in equity, total recognised income and expenses for the period, showing separately the amounts attributable to equity holders of the parent and to minority interest. The current periods presentation of the Groups nancial statements is based on the revised requirements of FRS 101. FRS 121: The Effects of Changes in Foreign Exchange Rates Items included in the nancial statements of each of the Groups entities are measured using the currency of the primary economic environment in which the entity operates (the functional currency). The consolidated nancial statements are presented in Ringgit Malaysia, which is the Companys functional and presentation currency. Under the revised FRS 121, exchange differences arising on a monetary item that forms part of a reporting entitys net investment in a foreign operation, where that monetary item is denominated in a currency other than the functional currency of either the reporting entity or the foreign operation, are to be recognised in prot or loss in the consolidated nancial statements. Previously, such exchange differences were taken to equity. This change in accounting policy has been accounted for retrospectively. In addition, as of 1 January 2006, any goodwill arising on the acquisition of a foreign operation and any fair value adjustments to the carrying amounts of assets and liabilities arising on the acquisition are now treated as assets and liabilities of the foreign operation and translated at the closing rate. In accordance with the transitional provisions of FRS 121, this change is applied prospectively. Goodwill acquired in business combinations prior to 1 January 2006 and fair value adjustments arising on those acquisitions are deemed to be assets and liabilities of the parent company and were translated using the exchange rate at the dates of acquisitions. FRS 140: Investment Property The adoption of this new FRS has resulted in a change in accounting policy for investment properties. Investment properties are now stated at fair value, representing open-market value determined by external valuers. Gains or losses arising from changes in the fair values of investment properties are recognised in prot or loss in the period in which they arise. Prior to 1 January 2006, investment properties were stated at valuation. Revaluations were carried out at least once every ve years and any revaluation increase is taken to equity as a revaluation surplus. The investment properties were last revalued in February 2006. In accordance with the transitional provisions of FRS 140, this change in accounting policy is applied prospectively.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (b) Adoption of Financial Reporting Standards (FRS) (Contd) FRS 140: Investment Property (Contd) The Group and the Company have not adopted the following:(i) FRSs that are mandatory for nancial periods beginning on or after 1 October 2006:(a) (b) (ii) FRS117 - Leases FRS124 - Related Party Disclosures
FRSs and amendment that are mandatory for nancial periods beginning on or after 1 January 2007:(a) FRS6 - Exploration for and Evaluation of Mineral Resources FRS6 is not relevant to the Groups and Companys operations. (b) Amendment to FRS1192004: Employee Benets Actuarial Gains and Losses, Group Plans and Disclosures Amendment to FRS1192004 is not relevant to the Groups and Companys operations.
(iii)
Deferred FRS 139 - Financial Instruments: Recognition and Measurement The Malaysian Accounting Standards Board has yet to announce the effective date of this standard.
(c)
Signicant Accounting Estimates and Judgements Estimates, assumptions concerning the future and judgements are made in the preparation of the nancial statements. They affect the application of the Groups accounting policies and reported amounts of assets, liabilities, income and expenses, and disclosures made. They are assessed on an on-going basis and are based on experience and relevant factors, including expectations of future events that are believed to be reasonable under the circumstances. (i) Key sources of estimation uncertainty The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date, that have signicant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next nancial year are discussed below:Income taxes The Group is exposed to income taxes in numerous jurisdictions. Signicant judgement is involved in determining the Group-wide provision for income taxes. There are certain transactions and computations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognised tax liabilities based on estimates of whether additional taxes will be due. Where the nal tax outcome of these matters is different from the amounts that were initially recognised, such difference will impact the income tax and deferred tax provisions in the period in which such determination is made.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (c) Signicant Accounting Estimates and Judgements (Contd) (i) Key sources of estimation uncertainty (Contd) Depreciation of property, plant and equipment Property, plant and equipment are depreciated on a straight-line basis over their useful life. Management estimated the useful life of these assets to be within 4 to 40 years except for the freehold land which is not depreciated. Changes in the expected level of usage and technological developments could impact the economic useful life and the residual values of these assets, therefore future depreciation charges could be revised. Deferred tax assets Deferred tax assets are recognised for all unutilised tax losses and unabsorbed capital allowances to the extent that it is probable that taxable prot will be available against which the losses and capital allowances can be utilised. Signicant management judgement is required to determine the amount of deferred tax assets that can be recognised, based upon the likely timing and level of future taxable prots together with future tax planning strategies. (ii) Critical judgement made in applying accounting policies The following is the judgement made by management in the process of applying the Groups accounting policies that have the most signicant effect on the amounts recognised in the nancial statements. Classication between investment properties and owner-occupied properties The Group determines whether a property qualies as an investment property, and has developed criteria in making that judgement. Investment property is a property held to earn rentals or for capital appreciation or both. Therefore, the Group considers whether a property generates cash ows largely independently of the other assets held by the Group. Some properties comprise a portion that is held to earn rentals or for capital appreciation and another portion that is held for use in the production or supply of goods or services or for administrative purposes. If these portions could be sold separately (or leased out separately under a nance lease), the Group accounts for the portions separately. If the portions could not be sold separately, the property is an investment property only if an insignicant portion is held for use in the production or supply of goods or services or for administrative purposes. Judgement is made on an individual property basis to determine whether ancillary services are so signicant that a property does not qualify as an investment property. (d) Basis of consolidation The Group nancial statements consolidate the audited nancial statements of the Company and all of its subsidiary companies, which have been prepared in accordance with the Groups accounting policies. All intercompany transactions, balances and unrealised gains on transactions between group companies are eliminated; unrealised losses are also eliminated on consolidation unless cost cannot be recovered.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (d) Basis of consolidation (Contd) The nancial statements of the Company and its subsidiary companies are all drawn up to the same reporting date. Acquisition of subsidiary companies is accounted for using the purchase method. The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition. Identiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the extent of any minority interest. Any excess of the Groups interest in the net fair value of the identiable assets, liabilities and contingent liabilities over the cost of business combination is recognised as income on the date of acquisition. Subsidiary companies are consolidated using the acquisition method of accounting from the date on which control is transferred to the Group and are no longer consolidated from the date that control ceases. The gain or loss on disposal of a subsidiary company is the difference between net disposal proceeds and the Groups share of its net assets together with any unamortised or unimpaired balance of goodwill on acquisition and exchange differences. (e) Property, plant and equipment Property, plant and equipment are initially stated at cost. Land and buildings are subsequently shown at market value, based on valuations by external valuers, less subsequent depreciation and any impairment losses. All other property, plant and equipment are stated at historical cost less accumulated depreciation and any impairment losses. Revaluation is made at least once in every ve years based on valuation by an independent valuer on an open market value basis. Any revaluation increase is credited to equity as a revaluation surplus, except to the extent that it reverses a revaluation decrease for the same asset previously recognised as an expense, in which case, the increase is recognised in the income statement to the extent of the decrease previously recognised. A revaluation decrease is rst offset against an increase on unutilised valuation surplus in respect of the same asset and is thereafter recognised as an expense. Upon the disposal of revalued assets, the attributable revaluation surplus remaining in the revaluation reserve is transferred to unappropriated prots. Depreciation is provided on the straight line method in order to write off the cost of each asset over its estimated useful life. No depreciation is provided on freehold land.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (e) Property, plant and equipment (Contd) The principal annual depreciation rates used are as follows:Leasehold land Factory buildings Renovation, warehouse extension and electrical installation Computers and software Plant and machinery Factory equipment Ofce equipments, furniture and ttings Telecommunication system, forklift and motor vehicles Over the leasehold period of 40 years 4% - 5.5% 10% - 20% 20% 7% - 10% 10% - 25% 10% - 20% 20%
Restoration cost relating to an item of property, plant and equipment is capitalised only if such expenditure is expected to increase the future benets from the existing property, plant and equipment beyond its previously assessed standard of performance. Property, plant and equipment are written down to recoverable amount if, in the opinion of the Directors, it is less than their carrying value. Recoverable amount is the net selling price of the property, plant and equipment i.e. the amount obtainable from the sale of an asset in an arms length transaction between knowledgeable, willing parties, less the costs of disposal. 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. Any gain or loss arising on derecognition of the asset is included in the income statement in the nancial year in which the asset is derecognised. (f) Subsidiary companies A subsidiary company is a company in which the Company or the Group either directly or indirectly owns a power to govern its nancial and operating policies so as to obtain benets from its activities. Investment in subsidiary companies is stated at cost. Where an indication of impairment exists, the carrying amount of the subsidiary companies is assessed and written down immediately to their recoverable amount.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (g) Associate company An associate company is a company in which the Company or the Group is in the position to exercise signicant inuence over its nancial and operating policies through management participation but not to exert control over those policies. Investment in an associate company is accounted for in the consolidated nancial statements using equity accounting which involves recognising in the income statement the Groups share of the results of associate company based on audited nancial statements of the associate company. The Groups investment in an associate company is carried in the balance sheet at an amount that reects its share of the net assets of the associate company. Equity accounting is discontinued when the carrying amount of the investment in an associate company reaches zero, unless the Group has incurred obligations or guaranteed obligations in respect of the associate company. Investment in an associate company is stated at cost. Where an indication of impairment exists, the carrying amount of the associate company is assessed and written down immediately to their recoverable amount. (h) Joint venture The Groups joint venture is an entity over which the Group has contractual arrangements to jointly share the control over the economic activity of the entity with one or more parties. Investment in joint venture is stated at cost. Interest in joint venture is accounted for using the equity method in the balance sheet of the Group. Allowance is made for any impairment losses on an individual joint venture basis. (i) Other investments Non-current investments other than investment in subsidiary companies, associate company and joint venture are shown at cost and allowance is only made where, in the opinion of the Directors, there is an impairment in value. Impairment in the value of an investment is recognised as an expense in the period in which the impairment is identied. On disposal of an investment, the difference between net disposal proceeds and its carrying amount is charged or credited to the income statement. (j) Investment properties Investment properties consist of land and buildings held for capital appreciation or rental purpose and not occupied or only an insignicant portion is occupied for use or in the operations of the Group. Investment properties are treated as long-term investments and are measured initially at cost, including transaction costs. The carrying amount includes the cost of replacing part of an existing investment property at the time that cost is incurred if the recognition criteria are met and excludes the costs of day-to-day servicing of an investment property. Subsequent to initial recognition, investment properties are stated at fair value, which reects market conditions at the balance sheet date. Gain or losses arising from changes in the fair values of investment properties are included in the income statement in the nancial year in which they arise.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (j) Investment properties (Contd) Investment properties are derecognised when either they are disposed of or when they are permanently withdrawn from use and no future economic benet is expected from the disposal. Any gain or loss on the retirement or disposal of an investment property is recognised in the income statement in the nancial year of retirement or disposal. (k) Inventories Inventories are stated at the lower of cost and net realisable value after adequate allowance has been made for deteriorated, obsolete and slow moving inventories. Inventories are determined on a rst-in-rst-out basis. Cost of trading goods is determined on weighted average method. Cost of raw material refers to invoiced cost of goods purchased plus incidental handling and freight charges. Cost of work-in-progress and nished goods include raw materials, direct labour and an appropriate proportion of manufacturing overheads. Net realisable value represents the estimated selling price in the ordinary course of business less selling and distribution costs and all other estimated costs to completion. (l) Receivables Receivables are carried at anticipated realisable value. Bad debts are written off in the period in which they are identied. An estimate is made for doubtful debts based on a review of all outstanding amounts at the nancial year end. (m) Payables Payables are stated at cost which is fair value of the consideration to be paid in the future for goods and services received. (n) Assets acquired under hire purchase and nance lease arrangements The cost of property, plant and equipment acquired under hire purchase and nance lease arrangements which transfer substantially all the risks and rewards of ownership to the Group are capitalised. The depreciation policy on these assets is similar to that of the Groups property, plant and equipment depreciation policy. Outstanding obligation due under hire purchase and nance lease arrangements after deducting nance expenses are included as liabilities in the nancial statements. Finance charges on hire purchase and nance lease arrangements are allocated to income statement over the period of the respective agreements.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (o) Foreign currency transactions and balances Transactions in foreign currencies are recorded in Ringgit Malaysia at rates of exchange ruling at the date of the transactions. Foreign currency monetary assets and liabilities are translated at exchange rates ruling at balance sheet date. The assets and liabilities of the foreign entities, including goodwill and fair value adjustments arising on the acquisitions, are translated to Ringgit Malaysia at the closing rates. The operating results are translated to Ringgit Malaysia at the average exchange rates during the nancial period. Gains and losses from conversion of short term assets and liabilities, whether realised or unrealised, are included in the income statement as they arise. Financial statements of foreign consolidated subsidiary companies are translated at period-end exchange rates with respect to the assets and liabilities. All resulting translation differences are included in the foreign exchange reserve in shareholders equity. On disposal of a foreign entity, the cumulative amount of exchange differences deferred in equity relating to that foreign entity is recognised in the income statement as a component of the gain or loss on disposal. All other foreign exchange differences are taken to the income statement in the nancial period in which they arise. (p) Deferred tax liabilities and assets Deferred tax liabilities and assets are provided for under the liability method at the current tax rate in respect of all temporary differences at the balance sheet date between the carrying amount of an asset or liability in the balance sheet and its tax base including unused tax losses and capital allowances. A deferred tax asset is recognised only to the extent that it is probable that taxable prot will be available against which the deductible temporary differences can be utilised. The carrying amount of a deferred tax asset is reviewed at each balance sheet date. If it is no longer probable that sufcient taxable prot will be available to allow the benet of part or all of that deferred tax asset to be utilised, the carrying amount of the deferred tax asset will be reduced accordingly. When it becomes probable that sufcient taxable prot will be available, such reductions will be reversed to the extent of the taxable prot. Deferred tax is measured at the tax rates that are expected to apply in the period when the asset is realised or the liability is settled, based on tax rates that have been enacted or substantively enacted by the balance sheet date. Deferred tax is recognised in the income statement, except when it arises from a transaction which is recognised directly in equity, in which case the deferred tax is also charged or credited directly in equity, or when it arises from a business combination that is an acquisition, in which case, the deferred tax is included in the resulting goodwill.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (q) Financial instruments Financial instruments carried on the balance sheet include cash and bank balances, investments, receivables, payables and borrowings. The particular recognition methods adopted are disclosed in the individual accounting policy statements associated with each item. Financial instruments are offset when the Group has a legally enforceable right to set off the recognised amounts and intends either to settle on a net basis, or to realise the asset and settle the liability simultaneously. (r) Impairment of assets At each balance sheet date, the Group reviews the carrying amounts of its assets to determine whether there is any indication of impairment. If any such indication exists, or when annual impairment testing for an asset is required, the recoverable amount is estimated and an impairment loss is recognised whenever the recoverable amount of the asset or a cash-generating unit is less than its carrying amount. Recoverable amount of an asset or a cash-generating unit is the higher of fair value less costs to sell and its value in use. In assessing value in use, the estimated future cash ows are discounted to their present value using a pre-tax discount rate that reects current market assessments of the time value of money and the risks specic to the asset. Impairment losses of continuing operations are recognised in the income statement in those expense categories consistent with the function of the impaired asset. An impairment loss is recognised as an expense in the income statement immediately, unless the asset is carried at a revalued amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extent of any unutilised previously recognised revaluation surplus for the same asset. An assessment is made at each balance sheet date as to whether there is any indication that previously recognised impairment losses for an asset other than goodwill may no longer exist or may have decreased. If such indication exists, the recoverable amount is estimated. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the assets recoverable amount. That increased amount cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised for the asset in prior years. All reversals of impairment losses are recognised as income immediately in the income statement unless the asset is carried at revalued amount, in which case, the reversal in excess of impairment loss previously recognised through the income statement is treated as revaluation increase. After such a reversal, the depreciation charge is adjusted in future periods to allocate the assets revised carrying amount, less any residual value, on a systematic basis over its remaining useful life. An impairment loss recognised for goodwill shall not be reversed in the subsequent period.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (s) Revenue recognition Revenue from sale of goods is recognised when the goods are delivered, net of discount and return. Rental income is recognised when the rent is due. Interest income is accounted for on accrual basis. Sales and inter-company transactions between companies of the Group are excluded from revenue of the Group. (t) Employee benets (i) Short term benets Wages, salaries, bonuses and social security contributions are recognised as an expense in the nancial year, in which the associated services are rendered by employees of the Group. Short term accumulating compensated absences such as paid annual leave are recognised when services are rendered by employees that increase their entitlement to future compensated absences, and short term non-accumulating compensated absences such as sick leave are recognised when the absences occur. (ii) Dened contribution plan Dened contribution plans are post-employment benet plans under which the Group pays xed contributions into separate entities or funds and will have no legal or constructive obligation to pay further contribution if any of the funds do not hold sufcient assets to pay all employee benets relating to employee services in the current and preceding nancial years. Such contributions are recognised as an expense in the income statement as incurred. As required by law, companies in Malaysia make such contributions to the Employee Provident Fund (EPF). Some of the Groups foreign subsidiaries also make contributions to their respective countries statutory pension schemes. (u) Interest-bearing borrowings Interest-bearing borrowings are recorded at the amount of proceeds received, net of transaction costs. All borrowing costs are recognised as expenses in the income statement in the period in which they are incurred. (v) Dividends Dividends on ordinary shares are accounted for in shareholders equity as an appropriation of unappropriated prots in the period in which they are declared.
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3. SIGNIFICANT ACCOUNTING POLICIES (CONTD) (w) Provisions Provisions are recognised when there is a present obligation, legal or constructive, as a result of a past event, when it is probable that an outow of resources embodying economic benets will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are reviewed at each balance sheet date and adjusted to reect the current best estimate. Where the effect of the time of money is material, the amount of a provision is the present value of the expenditure expected to be required to settle the obligation. (x) Cash and cash equivalents Cash and cash equivalents comprise cash in hand, bank balances, short term demand deposits and highly liquid investments which are readily convertible to known amount of cash and which are subject to an insignicant risk of changes in value. For the purpose of the balance sheet, cash and cash equivalents are restricted to be used to settle a liability of 12 months or more after the balance sheet date is classied as non-current asset. (y) Segmental results Segment revenues and expenses are those directly attributable to the segments and include any joint revenue and expenses where a reasonable basis of allocation exists. Segment assets include all assets used by a segment and consist principally of cash, receivables, inventories, intangible assets and property, plant and equipment, net of allowances and accumulated depreciation and amortisation. The majority of the segment assets can be directly attributed to the segments on a reasonable basis. Segment assets and liabilities do not include tax recoverable and deferred income taxes. (z) Inter-segment transfers Segment revenues, expenses and result include transfers between segments. The prices charged on inter-segment transactions are based on negotiation basis. These transfers are eliminated on consolidation.
4.
PRINCIPAL ACTIVITIES AND GENERAL INFORMATION The Company is principally engaged in investment holding and provision of management services. The principal activities of the subsidiary companies, associate company and joint venture are disclosed in Notes 11, 12 and 13 to the Financial Statements respectively. The Company is a limited liability company, incorporated and domiciled in Malaysia. The registered ofce of the Company is located at Level 15-2, Faber Imperial Court, Jalan Sultan Ismail, 50250 Kuala Lumpur. The principal place of business of the Company is located at PLO 234, Jalan Tembaga Satu, Pasir Gudang Industrial Estate, 81700 Pasir Gudang, Johor Darul Takzim. The nancial statements were authorised for issue by the Board of Directors in accordance with a resolution of the Directors on 25 May 2007.
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5. SHARE CAPITAL Group and Company 28.2.2007 RM Authorised:Ordinary shares of RM0.50 each At date of incorporation Created during the nancial period Carried forward Issued and fully paid:Ordinary shares of RM0.50 each At date of incorporation Issued during the nancial period pursuant to - acquisition of subsidiary companies - rights issue - public issue Carried forward
100,000 499,900,000 500,000,000
1 62,499,999 2,500,000 10,000,000 75,000,000
6.
FINANCE CREDITORS Group 28.2.2007 RM Future minimum lease payment - within 1 year - after 1 year but not later than 5 years
1,185,419 2,454,902 3,640,321 (363,467) 3,276,854
Less: Interest in suspense
Total present value payable - within 1 year - after 1 year but not later than 5 years
979,086 2,297,768 3,276,854
The amount payable within one year has been included in the other payables.
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7. BORROWINGS Group 28.2.2007 RM Current Secured:Term loans Bankers acceptance Trust receipts Domestic resource factoring
1,922,575 61,407,758 6,658,491 2,550,443 72,539,267
Unsecured:Collaterised loan obligations
831,112 73,370,379
Non-current Secured:Term loans Unsecured:Collaterised loan obligations
5,643,470
20,000,000 25,643,470 99,013,849
(i)
The term loans, bankers acceptance and trust receipts of the Group are secured against the following:(a) (b) (c) All landed properties of the Group; A rst legal charge on the machinery/equipment of a subsidiary company; Registered debentures covering xed and oating charge on xed and oating assets of a subsidiary company; Joint and several guarantee by certain Directors of the Company; and Fixed deposits.
(d) (e)
The term loans of the Group bear interest at rates ranging from 6.00% to 8.75% per annum. All term loans of the Group are repayable by monthly installments. The bankers acceptance bears commission at rates ranging from 1.15% to 1.75% per annum. The trust receipts bear interest at rates ranging from 7.47% to 8.00% per annum.
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7. BORROWINGS (CONTD) (ii) Domestic resource factoring is secured through joint and several guarantee by certain Directors of the Company. It bears interest at the rate of 7.25% per annum. Collaterised Loan Obligations (CLO) is payable upon maturity on 20 September 2010. It bears interest at the rate of 8.38% per annum of which the interest portion is payable twice per annum. As a condition to the granting of the above CLO, the Group is required to subscribe to a subordinated bond (Note 14).
(iii)
8.
DEFERRED TAXATION Group 28.2.2007 RM Additions through acquisition of subsidiary companies Transferred from income statement Carried forward 998,200 1,219,204 2,217,404
The balance in the deferred taxation is made up of temporary differences arising from:Group 28.2.2007 RM Tax effects of differences between carrying amount of qualifying property, plant and equipment and their tax base
2,217,404
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9. PROPERTY, PLANT AND EQUIPMENT Group
Total freehold land and building RM Short leasehold land RM Short leasehold building RM Total short leasehold land and building RM Renovation Machinery, and equipments, electrical furniture and installation ttings RM RM Forklift and motor vehicles RM
Cost
Freehold land RM
Freehold building RM
Total 28.2.2007 RM
Additions through acquisition of subsidiary companies Additions Disposals Carried forward Accumulated depreciation Additions through acquisition of subsidiary companies Charge for the nancial period Disposals Carried forward Net carrying amount 28.2.2007
5,433,334 -
5,790,000 -
11,223,334 -
1,400,000 -
2,600,000 -
4,000,000 -
1,171,015 8,880 -
10,268,398 487,432 (4,695)
5,522,897 793,853 -
32,185,644 1,290,165 (4,695)
5,433,334
5,790,000
11,223,334
1,400,000
2,600,000
4,000,000
1,179,895
10,751,135
6,316,750
33,471,114
335,593
3,021,767
2,556,873
5,914,233
96,500 -
96,500 -
11,667 -
34,666 -
46,333 -
75,125 -
332,796 (1,802)
340,898 -
891,652 (1,802)
96,500
96,500
11,667
34,666
46,333
410,718
3,352,761
2,897,771
6,804,083
5,433,334
5,693,500
11,126,834
1,388,333
2,565,334
3,953,667
769,177
7,398,374
3,418,979
26,667,031
All land and buildings of the Group are pledged to licensed banks as security for facilities granted to the Group. All property, plant and equipment of a subsidiary company are pledged to a licensed bank by way of debentures for credit facility granted to that subsidiary company. The net book value of property, plant and equipment of the Group which are acquired under hire purchase and nance lease arrangements amounted to RM3,956,402. Included in the property, plant and equipment of the Group are fully depreciated property, plant and equipment with a total cost of RM1,604,334. Included in the property, plant and equipment of the Group is a motor vehicle registered under the name of a Director of a subsidiary company with the cost of RM394,224.
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10. INVESTMENT PROPERTIES Total freehold land & buildings RM Freehold land & shophouse building RM
Group At fair value: Additions through acquisition of subsidiary companies
Freehold land RM
Freehold buildings RM
Renovation RM
Total 28.2.2007 RM
5,956,666
6,840,000
12,796,666
280,000
10,000
13,086,666
All investment properties of the Group are pledged to licensed banks as security for banking facilities granted to the Group. The investment properties are valued annually at fair value, comprising market value, by an independent professionally qualied valuer. The market value is dened as the estimated amount for which an asset or an interest in a property should exchange on the date of valuation between a willing buyer and a willing seller in an arms length transaction after proper marketing wherein the parties had acted knowledgeably, prudently and without compulsion.
11.
INVESTMENT IN SUBSIDIARY COMPANIES Company 28.2.2007 RM Unquoted shares - At cost:Additions / Carried forward The particulars of the subsidiary companies are as follows:Effective equity interest 28.2.2007 % 100
72,271,435
Name of company
Place of incorporation
Principal activities
1. Pantech Corporation Sdn. Bhd.
Malaysia
Trading, supply and stocking of high pressure seamless and specialised steel pipes, ttings, anges, valves and other related products for use in the oil and gas, gas reticulation, marine, onshore and offshore heavy engineering, power generation, petrochemicals, palm oil rening and other related industries.
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11. INVESTMENT IN SUBSIDIARY COMPANIES (CONTD) Effective equity interest 28.2.2007 %
Name of company
Subsidiary companies of Pantech Corporation Sdn. Bhd.: 1.1 Jayee Holdings Sdn. Bhd. 1.2 Pantech (Kuantan) Sdn. Bhd. Malaysia 100 Investment investment. holding and property
Malaysia
100
Trading and supply of high pressure seamless and specialised steel pipes, ttings, anges, valves and other related products for use in the oil and gas, gas reticulation, marine, onshore and offshore heavy engineering, power generation, petrochemicals, palm oil rening and other related industries. Manufacturing and supply of buttwelded carbon steel ttings such as elbows, tees, reducers, end-caps and high frequency induction long bends for use in the oil and gas and other related industries. Supplier of ow control solutions such as valves, actuators and controls for the oil and gas, petrochemicals, water treatment and other related industries and trading of specialised steel pipes and related products.
2. Pantech Steel Industries Sdn. Bhd.
Malaysia
100
3. Panao Controls Pte. Ltd.*
Singapore
100
Subsidiary company not audited by Shamsir Jasani Grant Thornton
The amounts due from/(to) subsidiary companies are unsecured, bear no interest and have no xed term of repayment.
12.
INVESTMENT IN AN ASSOCIATE COMPANY Group 28.2.2007 RM Unquoted shares - At cost:Addition through acquisition of subsidiary company Share of post-acquisition prot
26,217 13,983 40,200
Represented by:Share of net assets
40,200
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12. INVESTMENT IN AN ASSOCIATE COMPANY (CONTD) The particulars of the associate company are as follows:Effective equity interest 28.2.2007 % 30
Name of company
Tuah Nusa Sdn. Bhd.
Malaysia
Trading and supply of specialised industrial products, alloys and ferrous materials for the oil and gas and related industries.
The amounts due from/(to) an associate company are unsecured, bear no interest and no scheme of repayment has been arranged.
13.
INVESTMENT IN A JOINT VENTURE COMPANY Group 28.2.2007 RM Addition through acquisition of subsidiary company Share of post-acquisition loss 160,440 (38,517) 121,923 Represented by:Share of net assets The particulars of the joint venture company are as follows:Effective equity interest 28.2.2007 % 70 121,923
Name of company
JC Flow Controls Pte. Ltd. *
Singapore
Sales and distribution of JC products such as Ball, Gate, Globe and Check valves for South East Asian markets.
Held through Panao Controls Pte. Ltd.
The amount due to a joint venture company is unsecured, bears no interest and no scheme of repayment has been arranged.
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14. OTHER INVESTMENTS Group 28.2.2007 RM At cost:Quoted investment in Malaysia Subordinated bond (Note 7)
6,900 2,000,000 2,006,900
Market value of quoted investment in Malaysia
6,240
15.
DEFERRED TAX ASSETS Group 28.2.2007 RM Addition through acquisition of subsidiary company Transferred from income statement Carried forward (79,000) (822,195) (901,195)
The balance in the deferred tax assets is made up of temporary differences arising from:Group 28.2.2007 RM Tax effects of differences between carrying amount of qualifying property, plant and equipment and their tax base Allowance for slow moving inventories Allowance for doubtful debts
(56,474) (709,869) (134,852) (901,195)
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16. INVENTORIES Group 28.2.2007 RM At cost:Raw materials Work-in-progress Finished goods Goods in transit
6,674,912 889,262 92,019,607 1,449,083 101,032,864 (2,767,490) 98,265,374
Less: Allowance for slow moving inventories
17.
TRADE RECEIVABLES Group 28.2.2007 RM Trade receivables Less: Allowance for doubtful debts - Addition through acquisition of subsidiary companies - Addition during the nancial period 64,442,215 (290,698) (242,957) 63,908,560
Trade receivables comprise amounts receivable from sales of goods. The credit terms granted on sales of goods ranged from 30 days to 60 days. Allowance has been made for estimated irrecoverable of trade receivables based on the default experience of the Company.
18.
OTHER RECEIVABLES Group 28.2.2007 RM Non-trade receivables Deposit paid to customs Deposit for purchase of property, plant and equipment Sundry deposits Prepayments of expenses 315,689 554,500 546,120 338,081 748,246 2,502,636 Company 28.2.2007 RM 59,217 59,217
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19. FIXED DEPOSITS WITH LICENSED BANKS Group 28.2.2007 RM Current 23,131,535 Company 28.2.2007 RM 12,000,000
Included in the current xed deposits with licensed banks of the Group is an amount of RM11,131,535 pledged to the banks for banking facilities granted to the Group. The xed deposits with licensed banks are on oating rate basis and will be matured within 6 months to 12 months.
20.
TRADE PAYABLES Group Trade payables comprise amounts outstanding for trade purchases. The credit terms granted to the Company ranged from 30 days to 60 days.
21.
OTHER PAYABLES Group 28.2.2007 RM Non-trade payables Deposits received Accruals of expenses Finance creditors 666,160 233,410 765,414 979,086 2,644,070 Company 28.2.2007 RM 238,546 52,246 290,792
22.
BANK OVERDRAFTS - SECURED The bank overdrafts of the Group are secured against the following:(a) All landed properties of the Group except for a freehold land and shophouse of a subsidiary company; Registered debentures covering xed and oating charge on xed and oating assets of a subsidiary company; Joint and several guarantee by certain Directors of the Company; and Fixed deposits.
(b)
(c) (d)
Interest is charged at rates ranging from 6.13% to 8.25% per annum.
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23. REVENUE Group 15.5.2006 to 28.2.2007 RM Sales of goods Dividend income Management fee 90,584,227 90,584,227 Company 15.5.2006 to 28.2.2007 RM 4,794,554 354,000 5,148,554
24.
PROFIT BEFORE TAXATION Prot before taxation has been determined after charging/(crediting) amongst other items the following:Group 15.5.2006 to 28.2.2007 RM Allowance for doubtful debts Allowance for slow moving inventories Auditors remuneration - statutory - non statutory - other auditors Depreciation Directors remuneration - fees - other emoluments Direct operating expenses of investment properties: - revenue generated during the nancial period Hire of machinery Interest expense - hire purchase/nance lease - term loans/bonds - bank overdrafts - overdue - trust receipts/bankers acceptance/LC charges Rental - premises - warehouse - ofce equipment - crane - yard Loss on foreign exchange - realised - unrealised Dividend income Gain on disposal of property, plant and equipment Interest income from xed deposits Rental income 242,957 2,767,490 67,500 167,800 37,318 891,652 125,500 1,127,812 168,443 11,524 62,312 721,968 75,552 42 1,173,147 162,613 83,714 1,620 12,989 367,781 438,385 220,595 (1,066) (189,877) (259,851) Company 15.5.2006 to 28.2.2007 RM 10,000 2,200 25,500 104,426 (4,794,554) (8,836) -
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24. PROFIT BEFORE TAXATION (CONTD) The estimated monetary value of benets provided to the Directors of the Group during the nancial period by way of usage of the Groups assets and other benets amounted to RM67,150. The remuneration paid to the Directors of the Company is categorised as follows:Other emoluments RM 729,046 729,046 Benetsin-kind RM 62,550 62,550
Fees RM 28.2.2007 Executive Directors Non-Executive Directors Total 75,000 25,500 100,500
Total RM 866,596 25,500 892,096
The remuneration paid to the Directors of the Company analysed into bands are as follows:28.2.2007 RM100,000 to RM200,000 2 RM200,001 to RM500,000 2 -
Number of Directors Executive Directors Non-Executive Directors
<RM100,000 4
25.
TAXATION Group 15.5.2006 to 28.2.2007 RM Current periods provision Transferred to deferred taxation Transferred to deferred tax assets 1,207,030 1,219,204 (822,195) 1,604,039 Company 15.5.2006 to 28.2.2007 RM 1,358,530 1,358,530
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25. TAXATION (CONTD) Provision for current periods taxation is determined by applying the Malaysian statutory tax rate on the chargeable income. The reconciliation of income tax expenses applicable to prot before taxation at the statutory tax rate to the income tax expenses at the effective tax rate of the Group and of the Company are as follows:Group 15.5.2006 to 28.2.2007 RM Prot before taxation Taxation at Malaysian statutory tax rate of 27% Tax effects in respect of:Change in tax rate for the rst tranche of chargeable income Expenses not deductible for tax purposes Income not subject to tax Expenses allowable for double deduction Effective tax expenses 28,361,905 7,657,714 Company 15.5.2006 to 28.2.2007 RM 4,992,648 1,348,015
(29,722) 494,809 (6,486,433) (32,329) 1,604,039
10,515 1,358,530
However, the above amounts are subject to the approval of the Inland Revenue Board of Malaysia.
26.
EARNINGS PER SHARE The earnings per share has been calculated based on Groups prot after taxation of RM26,757,866 and the weighted average number of shares in issue during the nancial period of 40,790,984.
27.
EMPLOYEE BENEFITS EXPENSES Group 15.5.2006 to 28.2.2007 RM Staff costs 3,558,792 Company 15.5.2006 to 28.2.2007 RM 104,426
Included in employee benets expenses of the Group and of the Company is Directors remuneration of RM1,127,812 and RM104,426 respectively and dened contribution plan for the Group of RM83,308.
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28. SIGNIFICANT RELATED PARTY TRANSACTIONS Group 15.5.2006 to 28.2.2007 RM Transactions with subsidiary companies:- management fee received - dividend received Transactions with an associate company:- sales - purchase Transaction with joint venture company:- purchase Company 15.5.2006 to 28.2.2007 RM
3,669,211 817,332 47,444
354,000 4,794,554 -
The Directors of the Company are of the opinion that the terms of transactions have been entered on a negotiated basis.
29.
FINANCIAL INSTRUMENTS (a) Interest rate risk The interest rate risk that nancial instruments values will uctuate as a result of changes in market interest rates, and the effective weighted average interest rates on classes of nancial assets and nancial liabilities are as follows:Effective interest rates during the nancial period
Less than 1 year RM Group 28.2.2007 Financial asset Fixed deposits with licensed banks Financial liabilities Term loans Collaterised loan obligations Domestic resource factoring Trust receipts Bankers acceptance Bank overdrafts Hire purchase and nance lease
1 to 5 years RM
Total RM
23,131,535
23,131,535
2.65% - 3.70%
1,922,575 831,112 2,550,443 6,658,491 61,407,758 1,239,477 979,086
5,643,470 20,000,000 2,297,768
7,566,045 20,831,112 2,550,443 6,658,491 61,407,758 1,239,477 3,276,854
6.00% - 8.75% 8.38% 7.25% 7.47% - 8.00% 4.65% - 5.55% 6.13% - 8.25% 2.50% - 8.64%
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29. FINANCIAL INSTRUMENTS (CONTD) (a) Interest rate risk (Contd) Effective interest rates during the nancial period
Less than 1 year RM Company 28.2.2007 Financial asset Fixed deposits with licensed banks
1 to 5 years RM
Total RM
12,000,000
12,000,000
2.65% - 3.60%
(b)
Credit risk The maximum credit risk associated with recognised nancial assets is the carrying amount shown in the balance sheets. The Group and the Company have no signicant concentration of credit risk with any single counterparty.
(c)
Fair values The carrying amounts of all nancial assets and liabilities of the Group and of the Company as at the balance sheet date approximated their fair values except as set out below:Group Carrying amount RM Fair value RM Company Carrying Fair amount value RM RM
28.2.2007 Unquoted shares in subsidiary companies Unquoted shares in an associate company Unquoted shares in joint venture company Quoted investment in Malaysia Subordinated bond
72,271,435
40,200
121,923 6,900 2,000,000
* 6,240 #
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29. FINANCIAL INSTRUMENTS (CONTD) (c) Fair values (Contd) * It was not practicable within the constraints of timeliness and costs to estimate these fair values reliably. However, at the end of the nancial period, the net tangible assets reported by the subsidiary companies, associate company and joint venture company were as follows:15.5.2006 to 28.2.2007 RM Group Unquoted shares in an associate company Unquoted shares in joint venture company Company Unquoted shares in subsidiary companies 98,191,244 133,999 174,174
It was not practicable within the constraints of timeliness and costs to estimate these fair values reliably. However, at the end of the nancial period, the fair value of the subordinated bond is assumed to be the same as carrying amount as it is immaterial in the context of the nancial statements.
30.
CAPITAL COMMITMENTS Group 28.2.2007 RM Authorised but not contracted for:Purchase of motor vehicle and forklift Authorised and contracted for:Purchase of plant and machinery 269,642
2,053,814
31.
SIGNIFICANT EVENTS DURING THE FINANCIAL PERIOD On 7 November 2006, the Company acquired the entire issued and paid-up share capital of Pantech Corporation Sdn. Bhd. (PCSB) together with its subsidiary companies; Pantech (Kuantan) Sdn. Bhd. and Jayee Holdings Sdn. Bhd., which resulted in the Company becoming the holding company for PCSB. On 8 November 2006, the Company acquired the entire issued and paid-up share capital of Pantech Steel Industries Sdn. Bhd. (PSISB), which resulted in the Company becoming the holding company for PSISB. On 10 November 2006, the Company acquired the entire issued and paid-up share capital of Panao Controls Pte. Ltd (PCPL), which resulted in the Company becoming the holding company for PCPL. On 15 February 2007, the entire enlarged issued and paid-up share capital of the Company was successfully listed on the Main Board of Bursa Malaysia Securities Berhad.
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32. SIGNIFICANT EVENT SUBSEQUENT TO THE BALANCE SHEET DATE At the forthcoming Annual General Meeting, a nal dividend, in respect of the nancial period ended 28 February 2007, of 3 sen less 27% income tax per ordinary share on 150,000,000 ordinary shares amounting to a dividend payable of RM3,285,000 will be proposed for shareholders approval. The nancial statements for current nancial period do not reect 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 28 February 2008.
33.
SEGMENTAL REPORTING - GROUP (a) Primary segmental reporting - Business segment The Group is organised on a worldwide basis into three major business segments as follows:Business segments Trading of pipes, ttings and ow controls Business activities Trading, supply and stocking of high pressure seamless and specialised steel pipes, ttings, anges, valves and other related products for use in the oil and gas, gas reticulation, marine, onshore and offshore heavy engineering, power generation, petrochemicals, palm oil rening and other related industries. Manufacturing and supply of butt-welded carbon steel ttings such as elbows, tees, reducers, end-caps and high frequency induction long bends for use in the oil and gas and other related industries. Investment holding, property investment and management service.
Manufacturing of pipes and ttings
Investments and management
Trading of pipes, Manufacturing ttings and of pipes ow controls and ttings RM RM 28.2.2007 Revenue External revenue Inter-segment revenue Total revenue 74,703,373 15,880,854
Investments and management RM
Eliminations RM
Consolidated RM
90,584,227
3,836,017 78,539,390
846,121 16,726,975
5,148,554 5,148,554
(9,830,692) (9,830,692)
90,584,227
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33. SEGMENTAL REPORTING - GROUP (CONTD) (a) Primary segmental reporting - Business segment (Contd) Trading of pipes, Manufacturing ttings and of pipes ow controls and ttings RM RM 28.2.2007 Results Segment results Interest income Prot from operations Finance costs Share of prot in associate company Share of loss in joint venture company Prot before taxation Taxation Prot after taxation Other information Segment assets Investment in an associate company Investment in joint venture company Deferred tax assets Tax recoverable Consolidated total assets 188,403,717 36,438,293 101,232,088 (86,539,761) 239,534,337 9,527,181 198,044 9,725,225 (1,827,710) 3,302,483 48,300 3,350,783 (258,976) 17,455,471 8,835 17,464,306 (67,189) (65,302) (65,302) 65,302 30,285,135 189,877 30,475,012 (2,088,573) Investments and management RM
Eliminations RM
Consolidated RM
13,983
13,983
(38,517) 7,872,981 (1,806,118) 6,066,863
3,091,807 287,479 3,379,286
17,397,117 (85,400) 17,311,717
(38,517) 28,361,905 (1,604,039) 26,757,866
40,200
40,200
121,923 901,195 -
125,908
4,136
121,923 901,195 130,044
189,467,035
36,564,201
101,236,224
(86,539,761)
240,727,699
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33. SEGMENTAL REPORTING - GROUP (CONTD) (a) Primary segmental reporting - Business segment (Contd) Trading of pipes, Manufacturing ttings and of pipes ow controls and ttings RM RM 28.2.2007 Other information (Contd) Segment liabilities Tax payable Deferred taxation Consolidated total liabilities Capital expenditure on property, plant and equipment Depreciation 107,170,073 1,573,808 1,230,404 21,614,101 987,000 1,735,690 64,000 (11,486,264) 119,033,600 1,637,808 2,217,404 Investments and management RM
Eliminations RM
Consolidated RM
109,974,285
22,601,101
1,799,690
(11,486,264)
122,888,812
880,851 435,589
409,314 313,230
142,833
1,290,165 891,652
Segment assets consist primarily of property, plant and equipment, inventories, receivables and operating cash, and mainly exclude investment in an associate company, investment in joint venture company, deferred tax assets and tax recoverable. Segment liabilities comprise operating liabilities and exclude items such as taxation. Capital expenditure comprises additions to property, plant and equipment, including additions resulting from acquisition through business combinations. (b) Secondary segmental reporting Geographical segment There is no geographical segment information as the Group is predominantly operating in Malaysia.
34.
COMPARATIVE INFORMATION There are no comparative gures as this is the rst set of nancial statements being prepared.
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LIST OF PANTECH GROUPS PROPERTIES

AS AT 28 FEBRUARY 2007
( Land area ) Gross build-up area Sq.ft. (378,556) 223,453 Net book Approximate value age of Date of @ 28.2.2007 building last RM,000 Years revaluation 19,904 Factory A, B & C - 17 Factory D - 15 22.2.2006 Description / existing use 4 units of single storey detached factories ( identied for reference as Factory A, B, C and D ) A single storey detached warehouse with a 3-storey ofce building annexed A single storey semi-detached factory with a 3-storey ofce annexed
No. 1
Tittle details Geran 95059 and 95060 Lot No. 23191 and 23192 Mukim Kapar Dsitrict of Klang
Address Lot 13258 and 13259 Jalan Haji Abdul Manan Off Jalan Meru 41050 Klang, Selangor
Tenure Freehold
PTD 71061, HS(D) 125023, Mukim Plentong, District of Johor Bahru, Johor Darul Takzim Lot 64305, Geran 73035 Mukim Plentong, District of Johor Bahru, Johor Darul Takzim HS (M) 2633 Lot PTD No. 112716 Batu 16, Jalan Sungai Tiram Mukim Plentong District of Johor Bahru, Johor HS (D) 169521 Lot PTD No. 85407 Mukim of Plentong District of Johor Bahru, Johor HS (D) 206664 Lot PTD No. 59129 Mukim of Tebrau District of Johor Bahru, Johor HS (M) 373 and 337 Lot MLO No. 3810 and 3818 Mukim of Kota Tinggi, Johor PTD 102866, HS(D) 228518, Mukim Plentong, District of Johor Bahru, Johor Darul Takzim
PLO 234, Jalan Tembaga Satu, Pasir Gudang Industrial Estate, 81700 Pasir Gudang, Johor No. 4, Jalan Mutiara 4, Taman Perindustrian Plentong, 81750 Masai, Johor
(87,120) 39,600
Leasehold expiring on 30.9.2045
3,954
22.2.2006
(11,808) 11,640
Freehold
1,800
22.2.2006
PTD 112716 Jalan Sungai Tiram Batu 16 81800 Ulu Tiram, Johor
(72,092) 14,000
Freehold
A single storey detached warehouse with double storey ofce annexed
940
22.2.2006
No. 1 and 1A Jalan Molek 2/1 Taman Molek 81100 Johor bahru, Johor No. 12, Jalan Mutiara Emas 4/20 Taman Mount Austin, 81100 Johor Bahru, Johor 18th Mile Johor bahru Kota Tinggi main road Kota Tinggi, Johor No. 18 & 18A, Jalan Lampam 41, Tanjong Puteri Resort, 81700 Pasir Gudang, Johor
(2,704) 4,500
Freehold
A double storey corner shophouse
600
16
22.2.2006
(4,800) 3,930
Freehold
A 1 1/2 storey intermediate terrace factory
350
15
22.2.2006
11.13 acres
Freehold
Two parcels of agriculture land
330
N/A
22.2.2006
(1,540) 3,080
Freehold
A double storey intermediate shophouse
280
10
22.2.2006
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ANALYSIS OF SHAREHOLDINGS
AS AT 29 JUNE 2007
Authorized Share Capital Issued and Fully Paid-Up Share Capital Class of Shares Voting Rights No. of Shareholders : : : : : RM500,000,000.00 RM75,000,000.00 Ordinary Shares of RM0.50 Each One Vote Per Ordinary Share 1,238
DISTRIBUTION OF SHAREHOLDINGS AS AT 29 JUNE 2007 Category No. of Shareholders 2 288 672 190 81 5 1,238 % of Shareholders 0.16 23.26 54.28 15.35 6.54 0.41 100.00 No. of Shares 100 269,100 2,894,400 6,494,300 58,372,900 81,969,200 150,000,000 % of Shares 0.18 1.93 4.33 38.91 54.65 100.00
Less than 100 100 1,000 1,001 10,000 10,001 100,000 100,001 less than 5% of issued shares 5% and above of issued shares Total
LIST OF SUBSTANTIAL SHAREHOLDERS AS AT 29 JUNE 2007 Direct No. of Shares 36,494,200 24,815,400 20,659,600 Indirect No. of Shares 36,494,200 36,494,200 24,815,400 24,815,400
No. Names 1. 2. 3. 4. 5. 6. 7. CTL Capital Holding Sdn Bhd GL Management Agency Sdn Bhd Koperasi Permodalan Felda Berhad Chew Ting Leng Shum Kah Lin Goh Teoh Kean Lee Sock Kee
% 24.33 16.54 13.77 -
% 24.33 24.33 16.54 16.54
(a) (b) (c) (d)
DIRECTORS INTERESTS IN SHARES AS AT 29 JUNE 2007 Direct No. of Shares 3,026,200 4,802,100 30,000 30,000 15,000 Indirect No. of Shares 36,494,200 24,815,400 -
No. Names 1. 2. 3. 4. 5. 6. 7. Chew Ting Leng Goh Teoh Kean Tan Ang Ang To Tai Wai Tan Sui Hin Saw Siew Ee Abdul Karim Bin Ahmad
% 2.02 3.20 0.02 0.02 0.01
% 24.33 16.54 (a) (c)
Note: (a) Deemed Interest pursuant to Section 6A of the Act through his and his spouse Shum Kah Lins interest in CTL Capital Holding Sdn Bhd (b) Deemed Interest pursuant to Section 6A of the Act through her and her spouse Chew Ting Lengs interest in CTL Capital Holding Sdn Bhd (c) Deemed Interest pursuant to Section 6A of the Act through his and his spouse Lee Sock Kees interest in GL Management Agency Sdn Bhd (d) Deemed Interest pursuant to Section 6A of the Act through her and her spouse Goh Teoh Keans interest in GL Management Agency Sdn Bhd
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ANALYSIS OF SHAREHOLDINGS
AS AT 29 JUNE 2007
LIST OF TOP 30 SHAREHOLDERS AS AT 29 JUNE 2007 No. Shareholders 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24. 25. 26. 27. 28. 29. 30. KOPERASI PERMODALAN FELDA BERHAD CTL CAPITAL HOLDING SDN BHD CTL CAPITAL HOLDING SDN BHD GL MANAGEMENT AGENCY SDN. BHD. GL MANAGEMENT AGENCY SDN. BHD. LEE LIANG MONG AMANAH RAYA NOMINEES (TEMPATAN) SDN BHD (PUBLIC SMALLCAP FUND) TO TAI WAI LEE LIANG MONG TO TAI WAI TAN ANG ANG MAYBAN NOMINEES (TEMPATAN) SDN BHD (MAYBAN TRUSTEES BERHAD FOR PUBLIC AGGRESSIVE GROWTH FUND) MALAYSIA NOMINEES (TEMPATAN) SENDIRIAN BERHAD (GREAT EASTERN LIFE ASSURANCE (MALAYSIA) BERHAD (LGF)) SHUM BI SHIAN LEE LIANG MONG CITIGROUP NOMINEES (TEMPATAN) SDN BHD (EXEMPT AN FOR PRUDENTIAL ASSURANCE MALAYSIA BERHAD) MALAYSIA NOMINEES (TEMPATAN) SENDIRIAN BERHAD (GREAT EASTERN LIFE ASSURANCE (MALAYSIA) BERHAD (DR)) HSBC NOMINEES (TEMPATAN) SDN BHD (HSBC (MALAYSIA) TRUSTEE BERHAD FOR AMANAH SAHAM SARAWAK) LIM SOON BENG AMANAH RAYA NOMINEES (TEMPATAN) SDN BHD (PB BALANCED FUND) NG LEE LEE NG LEE LEE LIM SOON BENG MALAYSIA NOMINEES (TEMPATAN) SENDIRIAN BERHAD (OVERSEAS ASSURANCE CORPORATION (MALAYSIA) BERHAD (MGF)) SHUM BI SHIAN KONG CHIONG LEE SALINAH BINTI JAAFAR CHAI CHAU @ PEH CHAI CHAU TAN ANG ANG MALAYSIAN NOMINEES (TEMPATAN) SENDIRIAN BERHAD (GREAT EASTERN LIFE ASSURANCE (MALAYSIA) BERHAD (LGF)) TOTAL Shareholding 20,659,600 20,000,000 16,494,200 13,591,381 11,224,019 3,195,000 3,106,800 2,616,098 2,310,195 2,186,002 2,026,200 2,024,000 1,864,100 1,809,186 1,800,305 1,671,000 1,606,000 1,600,000 1,588,086 1,497,800 1,318,314 1,268,086 1,189,314 1,134,100 1,129,314 1,125,800 1,027,000 1,005,600 1,000,000 922,000 123,989,500 % 13.77 13.33 11.00 9.06 7.48 2.13 2.07 1.74 1.54 1.46 1.35 1.35 1.24 1.21 1.20 1.11 1.07 1.07 1.06 1.00 0.88 0.85 0.79 0.76 0.75 0.75 0.68 0.67 0.67 0.61 82.66
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TM
PANTECH GROUP HOLDINGS BERHAD

(Company No: 733607 W) (Incorporated in Malaysia)
PROXY FORM (Before completing this form please refer to the notes below) I/We................I/C No./Co. No./CDS A/C No. ........
(Full name in block letters)
of ......................................................................................................................................................................
(Full address)
being a member/members of PANTECH GROUP HOLDINGS BERHAD hereby appoint the following person(s):Name of proxy, NRIC No. & Address 1. ................................................... ................................................... 2. ................................................... ................................................... ......................... ......................... No. of shares to be represented by proxy
or failing him/her, the Chairman of the Meeting as my/our proxy to vote for me/us and on my/our behalf at the First Annual General Meeting of the Company to be held at Prince 3, Level 3, Prince Hotel & Residence Kuala Lumpur, Jalan Conlay, 50450 Kuala Lumpur, on Friday, 10th August 2007 at 10.00am. My/our proxy/proxies is to vote as indicated below:FIRST PROXY FOR Ordinary Resolution 1 Ordinary Resolution 2 Ordinary Resolution 3 Ordinary Resolution 4 Ordinary Resolution 5 Ordinary Resolution 6 Ordinary Resolution 7 Ordinary Resolution 8 Ordinary Resolution 9 Ordinary Resolution 10 Ordinary Resolution 11 Special Resolution 12
(Please indicate with a or X in the space provided how you wish your vote to be cast. If no instruction as to voting is given, the proxy will vote or abstain from voting at his/her discretion).
SECOND PROXY FOR AGAINST
AGAINST
Dated this..day of........2007 ..... Signature of shareholder(s)/Common Seal * Strike out whichever is not desired.
Notes 1. A member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and vote in his/her stead. A member may appoint up to two (2) proxies to attend the same meeting provided that he species the proportion of his shareholding to be represented by each proxy. A proxy may but need not be a member of the Company and a member may appoint any person to be his proxy without limitation and the provisions of Section 149(1)(b) & (c) of the Companies Act, 1965 shall not apply. Where a member is an authorised nominee as dened under the Security Industry (Central Depositories) Act, 1991, it may appoint at least one (1) proxy in respect of each Securities account it holds with ordinary shares of the Company standing to the credit of the said securities account. The instrument appointing a proxy shall be in writing under the hand of the appointer or his attorney duly authorized in writing or, if the appointer is a corporation, either under the Corporations Common Seal or under the hand of an ofcer or attorney so authorized. The Form of Proxy must be deposited at the Registered Ofce of the Company at Level 15-2, Faber Imperial Court, Jalan Sultan Ismail, 50250 Kuala Lumpur not less than 48 hours before the time set for holding the meeting or any adjournment thereof.
2.
3. 4.
FOLD HERE
FOLD HERE
Afx stamp here
The Secretary
PANTECH GROUP HOLDINGS BERHAD (733607 W) Level 15-2, Faber Imperial Court Jalan Sultan Ismail 50250 Kuala Lumpur
FOLD HERE

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Contents 02

Directors Prole Executive Chairmans Statement

Financial Statements List of Properties Analysis of Shareholdings Proxy Form

Stock Exchange Listing

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Pantech Steel Industries Sdn Bhd

Pantech Corporation Sdn Bhd

Panao Controls Pte Ltd

Pantech (Kuantan) Sdn Bhd

Jayee Holdings Sdn Bhd

Tuah Nusa Sdn Bhd

JC Flow Controls Pte Ltd

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Notice of Annual General Meeting

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Notice of Annual General Meeting

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Statement Accompanying Notice of Annual General Meeting

PANTECH GROUP HOLDINGS BERHAD (733607-W)

PANTECH GROUP HOLDINGS BERHAD (733607-W)

PANTECH GROUP HOLDINGS BERHAD (733607-W)

GOH TEOH KEAN

TAN ANG ANG

PANTECH GROUP HOLDINGS BERHAD (733607-W)

ABDUL KARIM BIN AHMAD

TAN SUI HIN

PANTECH GROUP HOLDINGS BERHAD (733607-W)

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Executive Chairmans Statement Rising to the challenge of a New Era

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Executive Chairmans Statement

Business Outlook and Strategies

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Executive Chairmans Statement

Related Party Transactions

Chew Ting Leng (Jimmy)

Executive Chairman/Group Managing Director

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Corporate Social Responsibility Activities

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Audit Committee Report

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Audit Committee Report

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Statement on Internal Control

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Statement on Internal Control

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Corporate Governance Statement

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Corporate Governance Statement

Executive Directors Non-Executive Directors Total

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Corporate Governance Statement

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Corporate Governance Statement

PANTECH GROUP HOLDINGS BERHAD (733607-W)

Additional Compliance Statement

PANTECH GROUP HOLDINGS BERHAD (733607-W)

31 32-33 34-35 36 37 38-40 41-72

PANTECH GROUP HOLDINGS BERHAD (733607-W)

15.5.2006 7.11.2006 8.11.2006 10.11.2006 18.12.2006 15.2.2007

Ordinary Ordinary Ordinary Ordinary Ordinary Ordinary

2 119,735,047 4,751,715 513,236 5,000,000 20,000,000