ABOUT VTI VINTAGE BERHAD GROUP.

VTI Vintage Berhad Group of Companies (VVB / The Group) commenced its business operations in December 1997, with the setting up of Vintage Tiles Industries SdnBhd (VTI)'s first production line of roofing tiles in a rented factory in Nilai Industrial Estate, Negeri Sembilan. This industrial land was purchased in Nilai to set up its own concrete roof tiles plant in 2003. Vintage Roofing & Construction SdnBhd (VRC) was incorporated in 1999, to complement the manufacturing activities of VTI by providing supply and lay services. In 2001, the Group purchased a roofing tile factory in Langkap, Perak wherein a high speed tile manufacturing machinery was installed to cater for the Northern market. The Group expanded further in 2003 with the acquisition of a piece of land in Rawang, Selangor and set up of its 3rd plant to cater for the growing concrete roof tile demand in the roofing industry. In November 2003, the Group achieved another milestone with the successful listing of its entire issued and paid-up share capital and ICULS on the Second Board of Bursa Malaysia Securities Berhad. In 2005, the Group emerged as a Total Roofing Solution (TRS) provider with the acquisition of Newsteel Building Systems SdnBhd (NBS). The Group had then acquired skills in providing roof designs, install light weight steel trusses, supply and lay of concrete roof tiles and accessories as well as providing re-roofing works.

Finance For Manager Assignment

Page 1

VTI VINTAGE: Corporate Social Responsibility The Company and its subsidiaries are always mindful of its CSR towards employees, community and stakeholders. A strong governance policy is necessary to ensure that CSR are fulfilled at their own premises, only then they can contribute positively to the community. Continue to place high emphasis on health and safety issues at their work sites. Necessary tools and protective gears are provided to their employees to ensure that they are adequately protected. They also enforce compliance requirements so that health and safety issues are not compromise. They also work very closely with environment enforcement agency with periodic consultations arrangements and visits so that our manufacturing activities are always in line with environmental standards and legislation. Continuously encourage employees to recycle and/or reduce wastage on the consumption of raw materials so that waste disposals are kept to the minimum. They are also incorporate changes to their manufacturing process to allow the usage of environmental friendly materials. At the marketplace, the Company and its subsidiaries maintain high integrity of corporate governance practices as well as enhancing the shareholders' value.

Finance For Manager Assignment

Page 2

Below is the details financial position of VTI Vintage.

Finance For Manager Assignment

Page 3

Finance For Manager Assignment

Page 4

Finance For Manager Assignment

Page 5

Below is the details statements cash flow of VTI Vintage.

Finance For Manager Assignment

Page 6

Finance For Manager Assignment

Page 7

Finance For Manager Assignment

Page 8

KEY FINANCIAL RATIOS

1. PROFITABILITY RATIOS I. Gross Profit Margin Gross Profit x 100% = 607827 x100 % = 8.03% Sales Y2010 = 8.03% Y2009 = (0.122)% 7564675

II.

Net Profit Margin / Net Loss Margin PBIT X 100% = -10989442 x100% = (1.45)% Sales Y2010 = (1.45)% Y2009 = (4.277)% 7564675

III.

ROCE/ROI LBIT Capital Employed Y2010 = 6.93% Y2009 = 1.93% X 100% = (10989442) x 100% = 6.93% 1584336

IV ROE PAIT Equity Capital Y2010 = (104.6)% Y2009 = (773.43)% X 100% =(11254367) x 100 % = (104.6)% (10751911)

Finance For Manager Assignment

Page 9

2. LIQUIDITY RATIOS I. Current Ratio Current Assets = 5398501 Current liabilities Y2010 = 0.134 Y2009 = 0.347 40258000 = 0.134

II.

Acid Test Ratio/ Quick Ratio Current Assets Inventory = 5398501 1638163 = 0.093 Current Liabilities Y2010 = 0.093 Y2009 = 0.286 40258000

3. GEARING RATIOS i. Long Term Debt to Capital Employed Long Term Debts x 100 % =12336247 Total Capt Employed 1584336 Y2010 = 7.786% Y2009 = 0.75% x 100% = 7.786%

ii.

Interest Cover PBIT = (10989442) = (21.37) (514160)

Interest Payable Y2010 = (21.37) Y2009 = (27.51)

Finance For Manager Assignment

Page 10

4. EFFICIENCY RATIOS i. Creditors Payment Period Creditors x 365 =2674800 x 365 = 140.33 Cost of Sale Y2010 = 140.33 Y2009 = 101.68 6956848

ii.

Debtors Collection Period Debtors x 365 =944403 x 365 = 45.56 Sales Y2010 = 45.56 Y2009 = 297.00 7564675

iii.

Inventory Turnover Average Inventory x 365 = 1638163 x365 = 85.94 Cost of Sales Y2010 = 85.94 Y2009 = 89.99 6956848

iv.

Sales to Fixed Assets Sales Fixed Assets Y2010 = 0.207 Y2009 = 0.206 = 7564675= 0.207 36443544

Finance For Manager Assignment

Page 11

5. INVESTMENT RATIOS i. Earnings per Share (EPS) PAIT No of Common Stock Y2010 = (11.54) Y2009 = (38.50) x 100 sen = (11254367) x 100 = (11.54) 97486002

ii.

Price Earnings Ratio (PE) Market Price = 0.020= -0.0017 EPS -11.54

Y2010 = (0.0017)

Finance For Manager Assignment

Page 12

BUSINESSSS PERFORMANCE REVIEW

In the year 2010, the construction and property sectors exhibited strong recovery from year 2009. The recovery was a result of the launching and implementation of Economic Transformation Programme (ETP), in which 131 Entry Points Projects (EPP) were identified to help take the nation towards a high income economy. With the improvement and growth in construction and property sectors, demand for building materials, including concrete roof tiles products has strengthened. However, with limited resources, the Group continued with its business directions realignment, focusing on market segments that bring better margin. A consequence of this realignment is the disassociation from less profitable orders, hence resulted in a decline in the Groups turnover. In protecting the Companys profit margin from being affect ed by a lower turnover, the Group has improved on the quality of its roof tiles with better quality control and substantial reduction in production costs as well as reducing the percentage of faulty reject roof tiles within the production line. These strategies have allowed the Group to decrease its logistics costs and wastages, in line with the Groups current strategy of improving overall cost and quality of its roof tiling products. At present, the Group is ready to embrace further challenges once it overcomes its financial and cash flow constraints after the implementation of the Regularizations Plan which has been submitted to Bursa Malaysia Securities Berhad (Bursa Securities) for their consideration and approval.

FINANCIAL PERFORMANCE REVIEW

For the financial year ended 31 December 2010, the Groups turnover was RM7.56 million, a decline of 13.9% as compared to a turnover of RM8.78 million in the previous year. However, profit margins of the Groups products have reflected a significant improvement from no profit margin in previous year to a margin of 7.9% during the year. This was mainly due to improvements in the quality of the Groups roof tiles, coupled with better quality control and a substantial reduction in production costs and faulty roof tiles at the production lines. Loss before taxation of the Group reduced from RM37.5 million in previous year (that included goodwill upon consolidation of RM24.6 million that had been written off) to RM11.0 million in the current year. For the year under review, the loss could be reduced further, however, the management has decided to write off Property, Plant and Equipment of RM4.75 million and provide for doubtful debts amounting to RM2.13 million in conjunction with the restructuring exercise.

Finance For Manager Assignment

Page 13

CORPORATE DEVELOPMENTS
The Company is considered an Affected Listed Issuer pursuant to the Practice Note 17 (PN17) of the Main Market Listing Requirements of Bursa Securities as it has triggered Paragraph 2.1 (a) of the PN17. As such, the Company is required to comply with all the obligations to regularize its condition in order to prevent the Company from de-listing by Bursa Securities. On 22 April 2011, application for the Companys regularization plan had been submitted to Bursa Securities for their consideration and approval. Once this approval is granted, a brighter milestone will be foreseen in the Companys growth. Meanwhile, the application for extension of Restraining Order (RO) under Section 176(10) of the Companies Act 1965 which expired on 7 May 2011 was granted with an extension for another one hundred and twenty (120) days from 11 May 2011 to 7 September 2011 by the High Court of Malaya at Kuala Lumpur for the Group to finalize the restructuring scheme. Details of the PN17 and RO have been disclosed in Note 31 of the audited financial statements for the financial year ended 31 December 2010.

MARKET AND INDUSTRY OVERVIEW AND FUTURE OUTLOOK

The ETP launched in September 2010 by our Prime Minister is going to drive new projects and developments worth RM67 Billion in total which covers the greater Kuala Lumpur and Klang Valley, education, oil and gas, infrastructure, agriculture, healthcare and other sectors. With new projects and developments, the construction sector is set for encouraging growth. The Malaysian government is currently on a commitment to ensure sufficient houses for various segments of the society. This has improved the performance of the residential sub-sector. Performance of the residential sub-sector also improved in tandem with increasing construction activity. On the supply side, housing registered an impressive growth of 41.6% following renewed interest of purchasers and developers, in tandem with the improved economic performance. In view of the above positive outlook on the construction and property sectors, coupled with the fact that the Group will be ready financially and operationally after the various improvements and restructuring, the Group intends to maintain its focus on its roof tiling manufacturing operations as the management of the Group believes there is still room in the market for a total roofing solutions provider. In addition, the management of the Group anticipates more construction projects to come on stream with the improving Malaysian economy and the launch of the ETP and government initiatives such as My New First Home Scheme where the Group will be in a position to take advantage of these upcoming projects. The Group has managed to tender and successfully secured contracts amounting to approximately RM70 million to date.

Finance For Manager Assignment

Page 14

FINANCIAL DECISION THAT RECOMMEND ALLEVIATING THE COMPANY FROM PN17 STATUS.
Composition and Balance of Board Directors Bring a balance of skills and experience appropriate to the business owing to their diverse backgrounds in the business, financial, political and commercial sectors.

Supply of Information The directors need to supply with quality and timely information which allows them to discharge their responsibilities effectively and efficiently.

Open Re-election and Re-appointment of Directors In accordance, at least one-third of the Directors shall retire by rotation at each AGM. All Directors are plant to retire from office at least once in every three years. Retiring Directors may offer themselves for re-election at the Annual General Meeting. Training The Director need to remain committed to undergoing further continuing education training programmes to upgrade and enhance their knowledge and to keep abreast with the constantly changing environment in the business and corporate sectors. Directors also have to access to various in-house seminars organized by the Group for its senior management staff, whereby they are invited to sit in and participate as and when their schedules permit.

Training all sales staff with the same competencies Sit down with your top sales clerks and see what makes them successful. When you identify successful processes you can train all team members to follow these performance evaluation examplesto improve sales performance as a whole and not just individually.

Finance For Manager Assignment

Page 15

Directors remuneration The main function of the Remuneration Committee is to make recommendations to the Board on the remuneration package for all Executive Directors to ensure that the Group attracts and retains Directors of calibre needed to run the Company successfully. The remuneration for the Executive Directors is structured to commensurate with corporate and individual performance. The remuneration of the Non-Executive Directors is a matter for consideration by the Board as a whole, save for directors fees. The shareholders at the AGM should approve the aggregate annual directors fees for all Directors.

Communication with shareholders and investors Recognizes the importance of regular and timely dissemination of information as part of the communication process with shareholders and investors to enable them to have an overview of the Groups performance and operations. On-going communication and dissemination of information is maintained mainly through various announcements made to Bursa Malaysia, which include financial statements and quarterly reports. The shareholders and members of the public are also should participate and to be invite to access the Groups website at; http://www.vintagegroup.com.my/ for the latest information on the Group. On a yearly basis, the AGM also should serves as a platform for shareholders communication with the Board besides affording them an opportunity to seek clarification, if required, on the financial and operational review of the Groups business as contained in the Annual Report.

Finance For Manager Assignment

Page 16

Implement accountability and auditors. The Audit Committee is assign to assists the Board by reviewing the information for disclosure to ensure completeness, adequacy and accuracy.

Internal Control Maintain a sound system of internal control and to review for its adequacy and integrity on an ongoing basis. The Board should seeks regular assurance on the integrity and effectiveness of the internal control systems from both the internal and external auditors. The Groups system of internal control can only provide reasonable but not absolute assurance against material misstatements, fraud or loss.

Assign Risk Management (purpose to continue profitability and enhancement of shareholder value.) The Risk Management Committee (RMC) of the Company against to assists the Board in undergoing the process for identifying, evaluating, monitoring and managing the significant risks across all the functions of the Group. The RMC must review and evaluates the adequacy of the overall risk management policies and procedures to ensure that risk exposures are being measures and monitored.

Implement A System of Internal Control Reorganization structure with key responsibilities clearly defined for the Board, members of the Board the executive management of the Groups operating units. Plans to chart a clear direction for all operating units to work cohesivelytowards meeting the business objective of the Group having assessed the inherent risks involved and necessary action plans thereof; Supply of regular and comprehensive financial and management information to management to enable them to monitor actual performance against approved plan so as to constantly keep track and monitor the directions in which the Group is heading; Written policies and procedures regulating financial and operating activities which are subjected to regular reviews and updates to reflect the changing business risks and to resolve operational deficiencies; and;

Finance For Manager Assignment

Page 17

Strategic planning for financial Invest in Property Investment property represents long leasehold land and building which is held for capital appreciation. The property is treated as long term investment and is stated at cost less accumulated depreciation and any accumulated impairment losses.

Non-Current Assets Held for Sale Non-current assets are stated at the lower of cost or carrying amount and fair value less costs to sell and are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use and only when the sale is highly probable and the asset is available for immediate sale in its present condition subject only to terms that are usual and customary.

Inventories Inventories need to control & valued at the lower of cost and net realizable value.

Receivables Receivables are carried at anticipated realizable value. Known bad debts are written off and specific allowance is made for debts considered doubtful of collection.

Leases A lease is recognized as fianc lease it if transfer substantially to the Group all the risks and rewards incidental to ownership. Leases of land and buildings are classified as operation or finance leases in the same way as leases of other assets and the land and buildings elements of a lease of land and building element of lease of land and building are considered separately for the purposes of lease classification. All leases that do not transfer substantially all the risks and rewards are classified as operating leases.

Finance For Manager Assignment

Page 18

Property, Plant and Equipment Acquired Under Hire Purchase Property, plant and equipment financed which is under hire purchase arrangements which transfer substantially all the risk and rewards of ownership are capitalized as property, plant and equipment. The depreciation policies of these property, plant and equipment are similar to those as set out in Note2(b) to the financial statements. Outstanding obligation under the hire purchase arrangements after deducting financial expenses are need to include as liabilities in the financial statements. The financial expenses are charged to the statement of comprehensive income over the period of the respective arrangements.

Taxation Taxation for the year comprises current and deferred tax. Current tax is the expected amount of income taxes payable in respect of the taxable income for the year and is measured using the tax rates that have been enacted or substantially enacted at the end of the reporting period. Adjustment is need to be made to recognize any over or under provision of tax expense in the previous year. Deferred taxation is provided in full, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the financial statements. Deferred taxation assets are recognized to the extent that it is probable that future taxable profit will be available against which the temporary differences can be utilized. Deferred taxation is measured using the tax rates that are expected to apply to the period when the asset is realized or the liability is settled based on the rate that have been enacted or substantially enacted by the end of the

Aware on government & global signal. Positive outlook on financially and operationally after the various improvements and restructuring. The Group must intends to maintain its focus on its roof tiling manufacturing operations as the management of the Group must believe there is still room in the market for a total roofing solutions provider. In addition, the management of the Group must anticipates more construction projects to come on stream with the improving Malaysian economy and the launch of the ETP and government initiatives such as My New First Home Scheme where the Group will be in a position to take advantage of the upcoming projects.

Finance For Manager Assignment

Page 19

Communicating sales goals throughout all departments. Sales department should not be the only department that understands the sales goals of the organization. The first step on how to improve sales involves explaining and documenting sales goals to all departments. If you are not sure if your objectives are clear, ask team members in customer service. If no one has a correct answer, it is time to have a departmental meeting to ensure customer service representatives, managers, and sales reps all have a good understanding. This should be a formal and key monitoring element forsales process steps. Reduce Costs There are two principle ways to reduce costs: looking for big savings, or make small reductions across the board To find big costs savings, concentrate on large savings first.

To make savings across the board, set a savings target (say, 10%) and reduce each budget by that amount. Then take small steps to reduce costs, eg: reduce train costs by travelling "standard" instead of "business"/"first" class, opting for cheaper equipment when purchasing, etc. Increase Sales :eg: through increased marketing, cross-selling to existing customers, offering special deals to get additional or advance orders, getting referrals with other organizations/affiliates. Raise prices Find alternative sources of income eg: renting out unused office space, assessing your waste or unused products and seeing if it has any value, selling advertising space on your website (eg: Google Adsense, YPN, MSN Adcenter, affiliates) or in physical spaces you have available, obtaining commissions from other organizations. Agree longer or scheduled payment terms with suppliers Replace existing loans, for example: loans that have a lower interest rate secured ones (replacing unsecured loans) to reduce the interest rate guaranteed loans (guaranteed by shareholders) to reduce the interest rate repayments over a longer period of time consolidated loans shareholder funds

Finance For Manager Assignment

Page 20

Defer tax liabilities (this requires specialist tax advice) Restructure Assets 1. Sell unnecessary assets (eg: surplus/old equipment, cars) 2. Convert necessary assets into liabilities: sell to a finance company and lease them back. 3. Factor invoices (this can reduce the asset value of the invoice, but raise cash). 4. Use investments or cash to pay off loans.

Raise more capital You can raise more capital by:

1. finding more investors, eg: venture capitalists 2. issuing more shares to current investors obtaining grant

Finance For Manager Assignment

Page 21