annual report 2017 w ah seong corpora tion berhad

211 Pages·2017·2.82 MB·English

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VISION
A global Oil & Gas and Industrial Services group that develops our portfolio of businesses into
world class standards.
MISSION
Be the preferred partner of our customers by providing quality services and reliable solutions,
whilst delivering sustainable growth and values to our employees, shareholders, partners
and stakeholders.
CORE VALUES
We are passionate about what we do
We deliver We hold ourselves We are a caring
our commitments and each other to the and responsible
to customers highest standards organisation
of professionalism,
accountability, integrity
and transparency
We work together to Performance, merit and We are intolerant
create an open, friendly equal opportunity are to waste
and safe workplace the cornerstones of our
rewards philosophy
Only sustainable profit
and growth will perpetuate
our business and enable
all of the above
ABOUT US
TABLE OF CONTENTS
ABOUT US FINANCIAL STATEMENTS
2 Worldwide Operation 64 Directors’ Report
3 Corporate Profile 69 Statement by Directors
4 Corporate Information 69 Statutory Declaration
70 Independent Auditors’ Report
THE YEAR IN BRIEF
75 Statements of Financial Position
5 Financial Highlights 77 Statements of Profit or Loss
6 Corporate Calendar 78 Statements of Other Comprehensive
8 Sustainability Statement Income
79 Consolidated Statement of Changes in
FROM THE BOARD OF Equity
DIRECTORS AND KEY SENIOR 81 Company Statement of Changes in Equity
MANAGEMENT 82 Statements of Cash Flows
86 Notes to the Financial Statements
18 Management Discussion And Analysis
24 Profile of the Board of Directors
ADDITIONAL INFORMATION
27 Profile of the Key Senior Management
191 Summary of Significant Recurrent
Related Party Transactions
GOVERNANCE
193 Top 10 List of Properties
30 Audit Committee
195 Analysis of Shareholdings
34 Remuneration Committee
198 Notice of Eighteenth Annual General Meeting
37 Nomination Committee
205 Statement Accompanying Notice of
41 Corporate Governance Overview
Eighteenth Annual General Meeting
Statement
58 Additional Compliance Information • Proxy Form
59 Statement on Risk Management and
Internal Control
62 Statement of Directors’
Responsibility
WAH SEONG CORPORATION BERHAD ANNUAL REPORT 2017 1
ABOUT US
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2 WAH SEONG CORPORATION BERHAD ANNUAL REPORT 2017
ABOUT US
CORPORATE
PROFILE
A RISING GLOBAL ENERGY SERVICE PROVIDER
Photo credit:
Nord Stream 2 AG, ©Axel Schmidt
INCORPORATED IN 1999, WAH SEONG CORPORATION BERHAD (“WSC” OR “THE
COMPANY”) HAS GROWN FROM STRENGTH TO STRENGTH, TRANSFORMING ITSELF
FROM A MEDIUM-SIZED MALAYSIAN ENTERPRISE INTO AN INTERNATIONAL OIL AND
GAS AND INDUSTRIAL SERVICES CONGLOMERATE. PROPELLED BY THE DYNAMIC
PACE OF THE ENERGY SECTOR AND RISING DEMAND, THE COMPANY CONTINUES
TO BUILD UPON ITS SUCCESS TO EFFECTIVELY MEET THE NEEDS OF BOTH THE OIL
AND GAS AS WELL AS NON-OIL AND GAS SECTORS AS A GLOBALLY INTEGRATED
INFRASTRUCTURE GROUP.
Listed on the Main Market of Bursa Malaysia Securities Berhad, WSC has established its footprint in more than 14 countries
worldwide – a feat made possible as a result of its vast technical experience and proven track records. As a rising global
player, WSC is committed to achieving success in a holistic manner whereby its economic ambitions are balanced out with
its societal and environmental obligations.
WAH SEONG CORPORATION BERHAD ANNUAL REPORT 2017 3
ABOUT US
CORPORATE
INFORMATION
DIRECTORS SOLICITORS REGISTERED OFFICE AND
PRINCIPAL PLACE OF
Dato’ Seri Robert Jeyaratnam & Chong BUSINESS
Tan Chung Meng Lee Hisahmmudin Allen & Gledhill
Non-Independent Non-Executive Rahmat Lim & Partners Suite 19.01, Level 19
Chairman The Gardens North Tower
Chan Cheu Leong PRINCIPAL BANKERS Mid Valley City
Managing Director/ Lingkaran Syed Putra
Group Chief Executive Officer OCBC Bank Group 59200 Kuala Lumpur, Malaysia
Tel : [phone]
Giancarlo Maccagno HSBC Bank Group
Fax : [phone]
Deputy Managing Director RHB Bank Berhad
Email : [email protected]
CIMB Group
Halim Bin Haji Din Website : www.wahseong.com
Malayan Banking Berhad
Independent Non-Executive Director
Professor Tan Sri Lin See Yan
STOCK EXCHANGE LISTING
Senior Independent Non-Executive PRINCIPAL ADVISERS
Director Main Market of Bursa Malaysia
RHB Investment Bank Berhad
Tan Jian Hong, Aaron Securities Berhad
CIMB Investment Bank Berhad
Non-Independent Non-Executive
Director
DATE OF LISTING
Tan Sri Saw Choo Boon SHARE REGISTRAR
Independent Non-Executive Director
9 July 2002
(Appointed on 6 April 2018) Agriteum Share Registration
Services Sdn Bhd
2nd Floor, Wisma Penang Garden CATEGORY
GROUP COMPANY
42 Jalan Sultan Ahmad Shah
SECRETARY
10050 Penang, Malaysia Industrial Products
Tel : [phone]
Woo Ying Pun Fax : [phone]
(MAICSA 7001280) Email : [email protected] STOCK CODE NO
5142
AUDITORS
STOCK NAME
PricewaterhouseCoopers PLT
(LLP0014401-LCA & AF 1146)
WASEONG
Chartered Accountants
Level 10, 1 Sentral, Jalan Rakyat
Kuala Lumpur Sentral
50706 Kuala Lumpur, Malaysia
COMMITTEE AUDIT NOMINATION REMUNERATION
COMMITTEE COMMITTEE COMMITTEE
Chairman Halim Bin Haji Din Professor Tan Sri Halim Bin Haji Din
Lin See Yan
Member Professor Tan Sri Dato’ Seri Robert Chan Cheu Leong
Lin See Yan Tan Chung Meng
Member Tan Jian Hong, Aaron Halim Bin Haji Din Professor Tan Sri
Lin See Yan
4 WAH SEONG CORPORATION BERHAD ANNUAL REPORT 2017
THE YEAR IN BRIEF
FINANCIAL
HIGHLIGHTS
OPERATING RESULTS 2013 2014 2015 2016 2017
Revenue RM’000 1,779,383 2,438,620 1,839,524 1,276,588 2,492,100
EBITDA/(LBITDA) RM’000 136,974 287,703 121,419 (72,001) 298,286
EBIT/(LBIT) RM’000 75,594 211,952 52,804 (204,913) 156,842
Profit/(Loss) Before tax RM’000 64,319 198,480 35,700 (225,864) 122,605
Net profit/(loss) RM’000 32,293 147,109 (11,868) (234,554) 114,643
Net Profit/(Loss) Attributable to
Owners of the Company RM’000 32,324 125,565 9,453 (228,302) 113,021
KEY BALANCE SHEET DATA
Total Assets RM’000 2,499,176 2,901,315 2,999,186 2,605,241 3,170,377
Paid-up Capital RM’000 387,444 387,444 387,444 387,444 547,690
Capital and Reserves Attributable to
Owners of the Company RM’000 983,509 1,074,977 1,121,918 775,891 894,161
VALUATION
Per share of RM0.50 each
Basic Earnings/(Loss) sen 4.20 16.26 1.22 (29.54) 14.63
Gross Dividend
- Cash Dividend sen 4.00 5.00 3.00 0.50 -
- Share Dividend sen 1.10 0.67 - - -
Net Assets RM 1.27 1.39 1.45 1.00 1.16
PROFITABILITY RATIOS
Return on Total Assets % 3 7 2 -8% 5%
Return on Capital Employed % 6 15 3 -21% 9%
GEARING RATIO
Net Debt to Capital and Reserves
Attributable to Owners of the
Company Times 0.46 0.69 0.80 1.18 0.76
WAH SEONG CORPORATION BERHAD ANNUAL REPORT 2017 5
THE YEAR IN BRIEF
CORPORATE
CALENDAR
Y 3 January H 2 March Y 30 May
R C A
Joint Venture and Shareholders’ Wasco Coatings Finland (Plant 1QFY2017 Results
A R M
U Agreement between Syn Tai A and Equipment) Oy, an indirect Announcement
N Hung Trading Sdn. Bhd., M wholly-owned subsidiary of
A an indirect wholly-owned WSC acquired plant, other
J subsidiary of WSC and Lesso assets and coating equipment E 1 June
N
Home Service Holdings Limited from Finland Pipecoating Oy WDG Resources Sdn. Bhd.,
U
for the purpose of carrying out an indirect subsidiary of WSC
J
the business as integrated sales 27 March entered into a Distributor
and service center Agreement with Doosan
Wasco Coatings Finland Oy
Infracore Co., Ltd.
commenced concrete weight
17 January coating operations in its
Incorporation of Wasco coating plant at the Port of
16 June
Coatings Finland (Plant and HaminaKotka, Mussalo
Incorporation of Wah Seong
Equipment) Oy by WSC’s
Management Services
indirect wholly-owned
28 March Sdn. Bhd., a wholly-owned
subsidiary namely Wasco
subsidiary of WSC
Coatings Finland Oy PT Wasco Engineering
Indonesia, an indirect subsidiary
of WSC delivered two identical 16 June
25 January
1,200 ton of Technical Building PT Wasco Engineering
Pipe Coating business unit of (E-House) for Kaombo North Indonesia, an indirect subsidiary
WSC hosted an exclusive lunch and South FPSO Projects (P2) of WSC was awarded US$
presentation with Nord Stream 2 to Schneider Electric (Australia) 11mil (equivalent to RM44.7mil)
at KL Hilton
contract by Schneider Electric
France for the provision of
26 January L 25 April design and construction of
I
R PT Wasco Engineering 3 electrical substations for
Incorporation of Lesso Home
P
Indonesia, an indirect subsidiary the Tengizchevroil (TCO)
Syn Tai Hung Sdn. Bhd., a joint A
of WSC hosted a delegation Kazakhstan
venture company between Syn
from Denmark’s DONG Energy
Tai Hung Sdn. Bhd., an indirect
as part of the pre-tender
wholly-owned subsidiary of
qualification exercise to design Y 17 July
WSC and Lesso Home Service
L
Holdings Limited and build offshore E-House U Wasco Coatings Germany
J GmbH commenced concrete
weight coating in Port of
Y 15 February Y 19 May Mukran
A
R WSC 17th Annual General
A Wasco Coatings Germany M
Meeting 17 July
U GmbH, an indirect wholly-
R owned subsidiary of WSC Wasco Coatings Finland Oy
B acquired 100% equity interest in 29 May took its first transshipment of
E
Mutares Holding-16 AG concrete weight coated pipes
F Pipe Coating business unit of
from Port of HaminaKotka,
WSC took its first load out of
Finland to the Port of Koverhar
28 February pipes for Johan Sverdrup Export
in Hanko
Pipeline Project (JoSEPP) from
4QFY2016 Results
Port of Kuantan to Leirvik,
Announcement
Norway
6 WAH SEONG CORPORATION BERHAD ANNUAL REPORT 2017
THE YEAR IN BRIEF
CCOORRPPOORRAATTEE
CCAALLEENNDDAARR
Y 24 July R 5 October
L E
U Disposal of Land and Buildings Wasco Coatings Germany
B
J by Wasco Resources Sdn. GmbH took first transshipment
O
Bhd., Wasco Coatings Services of its concrete coated pipes
T
Sdn. Bhd., Wasco Coatings C from its coating plant in
Insulation Sdn. Bhd., Wasco O Mukran, Germany to the Port of
Lindung Sdn. Bhd. and Wasco Karlshamn in Sweden
Coatings Malaysia Sdn. Bhd., 25 January 2017
the indirect subsidiaries of WSC
30 October
to RHB Trustees Berhad (as
trustee for Axis Real Investment Wasco Engineering International
Trust) Limited packaged and delivered
4 Waukesha Driven Ariel
compressor packages to the
T 1 August Basrah Gas Company, Iraq PNhoordto S ctrreeadmit: 2 AG, ©Axel Schmidt
S
U PT Wasco Engineering 27 March 2017
G Indonesia, an indirect subsidiary
U of WSC was awarded R 17 November
E
A US$ 24.2mil (equivalent Energy Services Division, an
B
to RM103.6mil) contract indirect subsidiary of WSC
M
by Siemens SAS for the completed the installation of a
E
provision of design and build V Sensorlink PipeMonit System
up of three (3) Substations O for the Gumusut Kakap field in
including Heating, Ventilation N Malaysia
28 March 2017
and Air Conditioning for the
Tengizchevroil (TCO) Area
29 November
project in Kazakhstan
3QFY2017 Results
28 August Announcement
PT Wasco Engineering
Indonesia, an indirect subsidiary Photo credit:
R 21 December Nord Stream 2 AG, ©Axel Schmidt
of WSC made its presence at
E Wasco Engineering Division, 5 October 2017
the 2017 Offshore Wind Farm B
an indirect subsidiary of WSC
Substation Conference in M
was awarded US$ 3.15mil
Bremen, Germany E
C (equivalent to RM12.8mil)
E ‘LOI’ by PTSC Mechanical
28 August
D & Construction Co., Ltd.
2QFY2017 Results (PTSC M&C), a subsidiary
Announcement of PetroVietnam Technical
Services Corporation (PTSC) for 30 October 2017
the supply and delivery of Gas
R 13 September Compressor package for Sao
E
Incorporation of WS Integrasi Vang and Dai Nguyet (SVDN)
B
Sdn. Bhd., a joint venture Development project in the
M
company between WSC and Idemitsu – operated blocks 05-
E
T Tengku Rozitatoria Binti Tengku 1b and 05-1c in the Nam Con
P Rostam Son Basin, Vietnam
E
S 17 November 2017
WAH SEONG CORPORATION BERHAD ANNUAL REPORT 2017 7
THE YEAR IN BRIEF
SUSTAINABILITY
STATEMENT
UNDERSTANDING THAT STAKEHOLDER EXPECTATIONS GOES BEYOND
UNDERSTANDING THE FINANCIAL HEALTH OF A COMPANY, AHEAD OF THE
COMPULSORY REQUIREMENT OF BURSA MALAYSIA FOR LISTED COMPANY
TO DELIBERATE ON ITS SUSTAINABILITY PRACTICE, THE COMPANY DECIDED
TO TAKE A PROACTIVE STEP IN 2017 TO DISCLOSE ITS SUSTAINABLE
BUSINESS MODEL BASED ON THE ECONOMIC, ENVIRONMENTAL, SOCIAL
(“EES”) PLATFORM. WHILST GOVERNANCE IS ALSO A KEY COMPONENT OF
SUSTAINABILITY, GOVERNANCE WILL NOT BE DISCUSSED IN THIS SECTION OF
THE ANNUAL REPORT BUT DISCUSSED SEPARATELY ON PAGES 41 TO 57 AS
PART OF THE DISCLOSURE REQUIREMENTS FOR CORPORATE GOVERNANCE
IN THE LISTING REQUIREMENTS, AS WELL AS THE MALAYSIAN CODE ON
CORPORATE GOVERNANCE 2017 AND THE CORPORATE GOVERNANCE GUIDE.
Photo credit:
Nord Stream 2 AG, ©Axel Schmidt
8 WAH SEONG CORPORATION BERHAD ANNUAL REPORT 2017