TEOSENG AnnualReport2013

Annual Report 2013
Hatching For The Future

Latest Technology
Strict Management Practises
Hygienic Quality
Ritma Prestasi Sdn. Bhd. (629010-U)
Lot 21 & 23, Jalan TPP 5/13, Seksyen 5, Taman Industri Puchong, 47100 Puchong, Selangor.
Tel: 03-80619330 / 80615332 Fax: 03-80619331 Website: www.ritmapres.com
4 Corporate Information
5 Group Corporate Structure
7 Profle Of The Board Of Directors
12 Chairmans Statement
14 Corporate Governance Statement
22 Statement of Risk Management
And Internal Control
24 Audit Committees Report
29 Financial Statements
98 Top 10 Properties Owned By
Teo Seng Capital Berhad
And Its Subsidiaries
99 Shareholdings Statistic
101 Notice Of Eighth Annual
General Meeting
Proxy Form
C
o
n
t
e
n
t
s
Certification ceremony
for ISO 22000 : 2005,
Codex Hazard Analysis and
Critical Control Point (HACCP)
and Good Manufacturing
Practise (GMP)
held at corporate
office of Teo Seng on
3 September 2013
Ritma Petworld JB held at
Danga City Mall on
14 December 2013 and
15 December 2013
Ritma Pet World KL
held at MIVEC
from 21 June 2013 to
23 June 2013
Ritma Me and My Pet
Superstar Award 2013 held
at Tao Sunway Giza
on 23 November 2013
Ritma Prestasi Sdn. Bhd. (Ritma)
Farrowing Pen Health
Programme Part 2 held at
Tj Sepat on 29 May 2013
Seventh Annual General
Meeting held at
Riverview Hotel on 25 June 2013
Training on Intermediate Excel
Program held at
corporate office of Teo Seng
Capital Berhad ("Teo Seng")
on 17 July 2013
and 18 July 2013
VIV Asia 2013 held in Bangkok
from 13 March 2013
to 15 March 2013
Ritma Lohman Coryza
Gold launch held at
Genting on 13 November 2013
Ritma Livestock Asia Expo and
Forum held at Kuala Lumpur
Convention Centre from
24 October 2013 to 26 October 2013
Ritma obtaining Small and Medium Enterprise
(SME) 100 awards 2013 for the fast moving companies at
Palace of Golden Horses on 16 December 2013
Ritma Dogathon 2013 road show
held at UPM on 6 October 2013
Employees of Ritma
attended Baytril Seminar held at
Ciao Ristorante on 21 July 2013
Ritma teambuilding at
Pangkor from 11 October 2013
to 13 October 2013
Livestock Asia Expo and
Forum held at Kuala Lumpur
Convention Centre from
24 October 2013 to 26 October 2013
Corporate Social Responsibility
held at Yong Peng High School
on 3 November 2013
BOARD OF DIRECTORS
Lau Jui Peng
Executive Chairman
Nam Yok San
Managing Director
Na Yok Chee
Executive Director
Lau Joo Han
Executive Director
Tan Sri Lau Tuang Nguang
Non-Executive Director
Dato Zainal Bin Hassan
Loh Wee Ching
Choong Keen Shian
Independent Non-Executive Director
Frederick Ng Yong Chiang
Dato Koh Low @ Koh Kim Toon
AUDIT COMMITTEE
Choong Keen Shian
Committee Chairman
Committee Member
(Appointed on 27 August 2013)
Committee Member
Committee Member
SECRETARIES
Lim Meng Bin
(LS 005798)
Wong Wai Foong
(MAICSA 7001358)
Tan Bee Hwee
(MAICSA 7021024)
AUDITORS
Crowe Horwath
(AF 1018)
8, Jalan Pesta 1/1
Taman Tun Dr Ismail 1
Jalan Bakri
84000 Muar
Johor Darul Takzim
PRINCIPAL BANKERS
OCBC Bank (Malaysia) Bhd
Bangkok Bank Berhad
AmBank (M) Berhad
Hong Leong Bank Berhad
RHB Bank Berhad
CORPORATE WEBSITE
www.teoseng.com.my
REGISTERED OFFICE
201-203, Jalan
Abdullah
84000 Muar
Johor Darul Takzim
Tel : 06-9519992
Fax : 06-9531249
HEAD OFFICE
Lot PTD 25740, Batu 4,
Jalan Air Hitam,
83700 Yong Peng,
Johor Darul Takzim
Tel : 07-4672289
Fax : 07-4672923
REGISTRAR
Tricor Investor Services Sdn.
Bhd.
Level 17, The Gardens
North Tower
Mid Valley City
Lingkaran Syed Putra
59200 Kuala Lumpur
Tel : 03-22643883
Fax : 03-22821886
STOCK EXCHANGE LISTING
Bursa Malaysia Securities Berhad
Main Market
Date Of Listing
29 October 2008
Corporate Information
Teo Seng
Capital Berhad
4
Annual
Report
2013
Group Corporate Structure
Teo Seng
Capital Berhad
5
Annual
Report
2013
60%
Forever Best
Supply
Sdn. Bhd.
(756583-V)
100%
Laskar Fertiliser
Sdn. Bhd.
(939951-U)
100%
B-Tech
Aquaculture
Sdn. Bhd.
(887536-H)
Teo Seng
Capital Berhad
(732762-T)
100%
Teo Seng
Paper Products
Sdn. Bhd.
(299992-H)
100%
Success
Century
Sdn. Bhd.
(346210-A)
100%
Teo Seng
Feedmill
Sdn. Bhd.
(474189-H)
100%
Teo Seng
Farming
Sdn. Bhd.
(111937-P)
100%
Liberal
Energy
Sdn. Bhd.
(886291-T)
100%
Pioneer
Prosperity
Sdn. Bhd.
(946258-M)
100%
Premium Egg
Products
Pte. Ltd.
(200305167W)
100%
Ritma
Prestasi
Sdn. Bhd.
(629010-U)
Board Of Directors
Standing from left to right:
Mr. Choong Keen Shian, Mr. Frederick Ng Yong Chiang, Mr. Loh Wee Ching, Mr. Lau Joo Han, Mr. Na Yok Chee,
Dato Koh Low@ Koh Kim Toon
Sitting from left to right:
Tan Sri Lau Tuang Nguang, Mr. Nam Yok San, Mr. Lau Jui Peng, Dato Zainal Bin Hassan
Teo Seng
Capital Berhad
6
Annual
Report
2013
Profile Of The Board Of Directors
Teo Seng
Capital Berhad
7
Annual
Report
2013
Mr. Lau Jui Peng, Malaysian, aged 43, was appointed
as the Non-Executive Chairman of the Company on 19
June 2008 and redesignated to Executive Chairman on
27 August 2013. He is one of the representatives of
Leong Hup Holdings Sdn. Bhd. (LHH) on the Board of
Directors of the Company.
Mr. Lau obtained a Bachelor of Science in Business
Administration majoring in marketing from Hawaii Pacific
University, United States of America in 1996. Upon his
graduation, Mr. Lau worked in a brief stint as an Assistant
Manager in a supermarket before joining the LHH group of
companies. Since then, Mr. Lau has been appointed as the
Deputy Chief Executive Officer of Leong Hup Poultry Farm
Sdn. Bhd., where he is in charge of the production
processes and administration. Mr. Lau is also involved in the
production processes and administration of Leong Hup
(G.P.S) Farm Sdn. Bhd. Mr. Lau was invited to the Board of
Leong Hup Poultry Farm Sdn. Bhd. on 24 December 2004
and subsequently to the Board of Leong Hup (G.P.S) Farm
Sdn. Bhd. on 21 March 2007. Besides these two
companies, he also sits on the Board of several other
subsidiaries of the Company, LHH and Emivest Sdn. Bhd.
Mr. Laus knowledge and experience in the production
processes and management of poultry companies is further
augmented by his attendance of several supervisory and
management seminars on poultry farm operations and
management conducted both locally and overseas.
Mr. Lau is the nephew of Tan Sri Lau Tuang Nguang who is
the Non-Executive Director of the Company. Except for
certain related party transactions of revenue nature which
are necessary for day to day operation of the Company
and its subsidiaries and for which he is deemed to be
interested, there are no other business arrangements with
the Company in which he has personal interest. Mr. Lau
has no conviction of any offences within the past ten (10)
years. Mr. Lau had attended all of the five (5) Board of
Directors Meetings held in the financial year ended 31
December 2013.
Mr. Nam Yok San, Malaysian, aged 58, was appointed
as the Managing Director of the Company on 19 June
2008. With nearly thirty five (35) over years of experience in
poultry farming, of which the past twenty (20) years had
been focused on the layer farming business, Mr. Nam in his
capacity as the Managing Director of Teo Seng Farming
Sdn. Bhd. (TSF) is responsible to oversee the overall
operations and directions of the Group within the layer
farming industry.
Mr. Nam was involved in the family business of rearing
broiler chickens since it began in 1978, and was one of the
founding partners of TSF when it was incorporated on 22
December 1983.
In 1992, under Mr. Nams stewardship, the TSF Group
undertook a strategic change in business direction by
shifting its focus from rearing broiler chickens to layer
farming. Since then, with his leadership and guidance, the
TSF Group had become one of the largest egg producers
in the country.
From 1994 to 2008, Mr. Nam served as the Managing
Director of Teo Seng Paper Products Sdn. Bhd. (TSPP)
overseeing the overall operations and ensuring that the
Company performs its function as another integral limb of
the integrated layer farming model which has been
adopted for the TSF Group. He has also been appointed
as Executive Director in Teo Seng Feedmill Sdn. Bhd.
(TSFM) since 2000. With his vast experience in the
industry and his contribution to our Group, Mr. Nam is an
invaluable asset of our Group. He also sits on the Board of
several other private limited companies in Malaysia and
Singapore.
Mr. Nam is a sibling of Mr. Na Yok Chee who is the
Executive Director of the Company. Except for certain
related party transactions of revenue nature which are
necessary for day to day operation of the Company and its
subsidiaries and for which he is deemed to be interested,
there are no other business arrangements with the
Company in which he has personal interest. Mr. Nam has
no conviction of any offences within the past ten (10)
years. Mr. Nam had attended all of the five (5) Board of
Directors Meetings held in the financial year ended
31 December 2013.
Mr. Na Yok Chee, Malaysian, aged 57, was appointed
as the Executive Director of the Company on 19 June
2008. Like Mr. Nam Yok San, Mr. Na has been involved in
the family poultry business since 1978 and has played an
instrumental role in its transformation from being a broiler
chicken business into one of the largest layer farming
groups in the country.
With the experience and knowledge that he has gained in
the operations and management of our Group for nearly
thirty five (35) over years, Mr. Na is primarily responsible to
monitor the operation and performance of the brooding,
pullet and layer farms of our Group, as well as overseeing
any investment and expansion initiatives, including the
designing, construction and supervision of all farm
buildings.
He currently performs these duties for our Group in his
capacity as an Executive Director of TSF, a position he has
held since 1983, when he was one of the founding partners
of the company. Apart from this, he is also an Executive
Director in Teo Seng Feedmill Sdn. Bhd. (TSFM) and
Success Century Sdn. Bhd., which he has held since 2000
and 2008 respectively. Apart from this, he also sits on the
Board of several other private limited companies.
Mr. Na is a sibling of Mr. Nam Yok San who is the
Managing Director of the Company. Except for certain
related party transactions of revenue nature which are
necessary for day to day operation of the Company and its
subsidiaries and for which he is deemed to be interested,
there are no other business arrangements with the
Company in which he has personal interest. Mr. Na has
years. Mr. Na had attended all of the five (5) Board of
Directors Meetings held in the financial year ended
31 December 2013.
Mr. Lau Joo Han, Malaysian, aged 39, was appointed as
the Non-Executive Director of the Company on 19 June
2008 and redesignated to Executive Director on 27 August
2013. He is also one of the representatives of Leong Hup
Holdings Sdn. Bhd. (LHH) on the Board of Directors of
the Company.
Mr. Lau obtained a Degree of International Trade from
Victoria University, Melbourne, Australia in 1999. He is
currently the Director and Deputy Chief Executive Officer of
Ayam A1 Food Corporation Sdn. Bhd., a wholly-owned
subsidiary of LHH. Besides his roles in Ayam A1 Food
Corporation Sdn. Bhd., Mr. Lau is also extensively involved
in the broiler production processes and administration of
Leong Hup Contract Farming Sdn. Bhd. and Leong Hup
Broiler Farm Sdn. Bhd. Apart from the experience garnered
from his responsibilities, Mr. Lau has been constantly
attending various seminars conducted locally and overseas
in order to keep abreast of the latest trends and
technologies in the poultry industry. He was invited to the
Board of Leong Hup Broiler Farm Sdn. Bhd. on 10 October
2005, Teo Seng Farming Sdn. Bhd. (TSF) on 2 January
2009 and also to the Board of several other subsidiaries of
LHH and Emivest Sdn. Bhd.
Mr. Lau is the nephew of Tan Sri Lau Tuang Nguang who is
the Non-Executive Director of the Company. Except for
the Company in which he has personal interest. Mr. Lau
years. Mr. Lau had attended four (4) of the five (5) Board of
December 2013.
Teo Seng
Capital Berhad
8
Annual
Report
2013
Teo Seng
Capital Berhad
9
Annual
Report
2013
Tan Sri Lau Tuang Nguang, Malaysian, aged 55, was
appointed as Non-Executive Director of the Company on
19 November 2009, is one of the representatives of Leong
Hup Holdings Sdn. Bhd. (LHH) on the Board of Directors
of the Company. He was appointed as Audit Committee
Member and Remuneration Committee Member of the
Company on 27 August 2013. Tan Sri Lau has more than
thirty five (35) years of experience in the livestock industry.
Tan Sri Lau was appointed on 15 August 1990 as the
Executive Director of LHH, a Company formerly listed on
the Main Market of Bursa Malaysia Securities Berhad. He
also sits on the Board of PT Malindo Feedmill Tbk, a
Company listed on Jakarta Stock Exchange and also
appointed to the Board of various private limited
companies in Malaysia and overseas. In the year of 2004,
he was one of the panel advisors of Ministry of Agriculture
and Agro based Industry, a project initiated by the
Government for the development of the agriculture
industry in the country.
Tan Sri Lau is the uncle to Mr. Lau Jui Peng and Mr. Lau
Joo Han who are the Directors of the Company. Except for
and its subsidiaries and for which Tan Sri Lau is deemed to
be interested, there are no other business arrangements
with the Company in which he has personal interest. Tan
Sri Lau has no conviction of any offences within the past
ten (10) years. Tan Sri Lau had attended four (4) of the five
(5) Board of Directors Meetings held in the financial year
ended 31 December 2013.
Dato Zainal Bin Hassan, Malaysian, aged 69, was
appointed as the Non-Independent Non-Executive Director
of the Company on 19 November 2009, is the
representative of Koperasi Permodalan Felda Malaysia
Berhad on the Board of Directors of the Company.
Dato Zainal is the Chairman of few cooperatives in district
level, Deputy Chairman to Koperasi Serbausaha Makmur
Berhad (KOSMA) and member of the Board of Directors of
Koperasi Permodalan Felda Malaysia Berhad (KPF) at
national level since the inception of the KPF in the year
1980. With his past experience as the Pahang State
Assembly Member from the year 1982 to 1999, Dato
Zainal involved in various committees in Pahang State
Level and was also the Committee Chairman of
Jawatankuasa Kira-Kira Wang Kerajaan Negeri (PAC) prior
to his appointment as the EXCO Kerajaan Negeri Pahang
in the year 1999. He holds the position as Internal Auditor
to Pertubuhan Peladang Kebangsaan (NAFAS).
Dato Zainal does not have any family relationship with any
Director/ major shareholder of the Company. Except for
the Company in which he has personal interest. Dato
Zainal has no conviction of any offences within the past ten
(10) years. Dato Zainal had attended four (4) of the five (5)
Board of Directors Meetings held in the financial year
Dato Koh Low @ Koh Kim Toon, Malaysian, aged 61,
was appointed as the Independent Non-Executive Director
of the Company on 19 November 2009. He was appointed
as a member of Audit Committee of the Company on 13
April 2010.
Dato' Koh Low @ Koh Kim Toon has more than twenty five
(25) years experience and expertise in the furniture
industry. He sits on the Board of Emivest Sdn. Bhd. and
several private limited companies. Besides that, he is the
President of Chung Hwa High School, Muar, Johor since
2009. Presently, he is actively involved in local as well as
overseas investments.
Dato Koh does not have any family relationship with any
Director/ major shareholder of the Company. He does not
have any conflict of interest with the Company. Dato Koh
years. Dato Koh had attended three (3) of the five (5)
Mr. Loh Wee Ching, Malaysian, aged 45, was appointed
as the Non-Executive Director of the Company on 19 June
2008. He was appointed as member of both Remuneration
Committee and Nomination Committee on 27 August
2013. Mr. Loh joined Teo Seng Farming Sdn. Bhd. (TSF)
in 1994 as Sales Manager and he was promoted as the
Senior Marketing Manager in 2003. Prior to joining the
Group, he was a Marketing Executive in Telic Corporation
Sdn. Bhd., a diversified company which is also involved in
the poultry business. His past experience of more than
twenty (20) years in marketing and good customer
contacts has enabled him to contribute significantly to the
Groups marketing strategies. With his assertive marketing
skills and excellent customer relationship, he also plays a
major role in providing on-the-job training to the marketing
team of the subsidiaries of the Company.
Mr. Loh does not have any family relationship with any
Director/ major shareholders of the Company. He does not
have any conflict of interest with the Company. Mr. Loh has
years. Mr. Loh had attended all of the five (5) Board of
December 2013.
Mr. Choong Keen Shian, Malaysian, aged 57, was
appointed as the Independent Non-Executive Director of
the Company on 19 June 2008. He is the Chairman of
Audit Committee and a member of Nomination Committee
of the Company. He was redesignated as Chairman of the
Remuneration Committee on 27 August 2013. He
graduated with a Bachelor of Science (Hon) degree from
University of Malaya in 1981. He worked for more than ten
(10) years in the finance and banking industry initially with
OCBC Finance Bhd and later with The Pacific Bank Bhd
(now known as Malayan Banking Berhad) from 1981 to
1990. During his tenure in the financial industry, he was
involved in the credit and credit control management. He
joined a property development company, Arena Eksklusif
Sdn. Bhd. in 1991 and was involved in project
administration. Currently, he is the finance manager of
Atlas Edible Ice Sdn. Bhd., a member of The Atlas Ice
Group of Company, which is engaged in a wide array of
business activities such as oil palm and rubber plantation,
tube and block ice manufacturing and investment holdings
in Malaysia, Singapore and Indonesia. He is also the
director of several other private limited companies within
The Atlas Ice Group and several other private limited
companies which are involved in the retailing of lighting
accessories and lamps.
Mr. Choong does not have any family relationship with any
Director/ major shareholder of the Company. He does not
have any conflict of interest with the Company. Mr. Choong
years. Mr. Choong had attended four (4) of the five (5)
Mr. Frederick Ng Yong Chiang, Malaysian, aged 49,
was appointed as the Independent Non-Executive Director
of the Company on 19 June 2008. He is a member of the
Audit Committee was resignated to Nomination Committee
Chairman of the Company on 27 August 2013. He has
completed the professional course in accountancy and
thereafter being accepted as Associate member of the
Chartered Institute of Management Accountants, United
Kingdom and also a member of the Malaysian Institute of
Accountants since 1991. Mr. Frederick Ng has previously
worked for Hong Leong Industries Berhad as Project
Executive in 1990. He joined Tan Chong Group of
Companies in 1992 as the Administration and Accounting
Manager of the Groups Papua New Guinea operations. In
1993, he joined The Atlas Ice Group of Companies. He is a
Non-Executive Director of The Atlas Ice Company Berhad,
the holding company and is in charge of the ice
manufacturing companies of the Group in Penang, Kedah
and Perlis. He also sits on the Board of several other
private limited companies which are involved in the fast
moving consumer goods business.
Mr. Frederick Ng does not have any family relationship with
any Director/ major shareholder of the Company. He does
not have any conflict of interest with the Company. Mr.
Frederick Ng has no conviction of any offences within the
past ten (10) years. Mr. Frederick Ng had attended all of
the five (5) Board of Directors Meetings held in the
financial year ended 31 December 2013.
Teo Seng
Capital Berhad
10
Annual
Report
2013
Teo Seng Capital Berhad
balanced businesses in every aspects.
We use principles and ethics as a foundation
for every decisions and actions made in order
to achieve overall excellences.
encourages honest and
Chairmans Statement
Teo Seng Capital Berhad (Teo Seng) Groups continuous effort is the key to unlock our potential.
As we believe impossible situations can become possible miracles, we take into account long term
impacts and interests of wide range of constituents.
Lau Jui Peng
Chairman
Dear Shareholders,
Once again, on behalf of the Board of Directors and its team member, I would like to express my deepest appreciation to
our shareholders for your entrustment and everlasting support toward our group. It is my honour to present you the Annual
Report and Audited Financial Statement of Teo Seng Capital Berhad for the financial year ended 31 December 2013. The
report provides stakeholders a platform to evaluate the result, strategy and future potential of the business.
FINANCIAL HIGHLIGHTS
Marvellous is the most accurate word to describe the 2013 financial result. Despite Teo Seng operation under amidst
competitors challenge, labour threat and national economic uncertainties, the Group achieved a commendable profit after
tax of RM23.38 million on the back of revenue of RM330.76 million. This result was recorded breaking for the Group in term
of revenue and profit after tax since it was listed on Bursa Malaysia mainly attributed to the improved selling price of eggs
throughout the entire year of 2013.
The net asset per share as at 31 December 2013 stand at RM0.66, increase of 17.86% from the previous financial period.
The Groups basic earnings per share for the financial year under review is 11.71 sen, again the highest in the Groups
history.
A manageable gearing ratio of 0.65 times was recorded despite multi-complex economic and market position. This figure
was comparatively lower and healthier as compared with last term standing of 0.76 times mainly due to increase in capital
reserves.
By all accounts and any measure, 2013 was an extraordinary year for Teo Seng Capital Berhad, and we are well positioned
for continued growth and success in the subsequent year.
DIVIDEND
During the financial year, an interim single tier dividend of 5% amounting to RM2 million in respect of ordinary shares was
fully paid on 20 September 2013.
Based on our outstanding performance, the group is recommending a final single tier dividend of 7.5% or 1.5 sen per
ordinary share for the financial year ended 31 December 2013 subject to shareholders approval at the forthcoming Annual
General Meeting of the company.
For the dividend record, Teo Seng has been consistently to pay out dividend for every profit making financial year since its
listing in 2008.
OPERATION REVIEW
We have overcomed uncountable challenge faced in this industry, but we remain focused to achieve excellent product
quantity and quality, diminishing operation expenses in order to enhance better profitability for the Group.
In the 7
th
Malaysia Livestock Asia Expo & Forum held in September 2013, once again Teo Seng Farming Sdn. Bhd., a
wholly-owned subsidiary of Teo Seng Capital Berhad has awarded the Outstanding Layer Farm award of Malaysia for the
second time and represents the third awards in the group history by The Malaysia Livestock Industry Award endorsed by
Department of Veterinary Services, Malaysia.
On 3 May 2013, an additional farm registered under Teo Seng Farming Sdn. Bhd. was accredited and granted export
license by Agri-Food and Veterinary Authority of Singapore, made up a total of 8 export farms as at to-date.
Teo Seng
Capital Berhad
12
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Report
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Chairmans Statement
Teo Seng
Capital Berhad
13
Annual
Report
2013
Ritma Prestasi Sdn. Bhd., a wholly-owned subsidiary of Teo Seng Capital Berhad specialising in animal healthcare solution
was awarded the Outstanding Top 10 Companies for Malaysias Fast Moving Companies in the SME100 Award 2013 on
16 December 2013.
Laskar Fertilisers Sdn. Bhd., a wholly-owned subsidiary of Teo Seng Farming Sdn. Bhd., concentrating on research and
development on converting raw chicken manure into pure organic fertiliser has introduced first batch of its experimental
product on 30 September 2013. The product is distributed to farmer for free trial concurrently while waiting the finalizing of
pricing and marketing strategy for the official launch.
Our success was driven by improved result in each of our business unit and reflects the strength of our entire portfolio. We
will continue to uphold our business model and upgrade our facilities to meet our consumers preference and needs.
PROSPECTS
We foresee the tough challenge can never be ended in livestock industry. Despite many unforeseeable circumstances
ahead, we are confident that we are well-equipped with all necessary human capital to resolve all the issues.
Research and Development of converting raw chicken into monetary return has been undergo a significant journey of
incubation period and was expected to commence its first baby step in short future. As mentioned earlier, the
management is expecting organic fertiliser division to market its product in second or third quarter of the year 2014 and
decisive movement for Biogas Plant should also take place in year 2014.
Farm improvement and expansion was always the most important agenda as it represents the core business for the group.
In year 2014, number of farms will be upgrading with new facilities to strengthen the product quantity and quality,
nevertheless, the management has decided to set up two additional farms to accommodate increasing market demand.
On the other hand, the management is planning to replace Liquefied Petroleum ("LP") Gas with Natural Gas for egg tray
production. Natural gas is an ideal replacement solution to high-price LP Gas at approximately 80% lower in cost.
APPRECIATION
Its clear that outstanding people are the reason for the success of a dynamic business like us. Therefore, firstly to the crew
member which inclusive from top management to supporting level, I would like to extend my sincere thanks to all of you for
your contribution and hardworking that made us where we are today.
The management strives to strengthen our people and assists them achieve their best in the increasing demanding
marketplace. In short, we are committed to lead the todays workforce into tomorrows leader as form of appreciation
beside its remuneration package.
Last but nevertheless, as the group embarks on another year, I would like to once again to express my deepest gratitude to
our shareholders, investors, customers, business associate and governing authority for your continuous support which
sailed us to milestone today and believe to move beyond further in year 2014.
Once again, let us hatch for the future hand in hand for better future.
Corporate Governance Statement
The Board of Directors (Board) of Teo Seng Capital Berhad (Teo Seng or Company) recognises the importance of
adopting high standards of corporate governance throughout the Company and the Group as a fundamental part of
discharging its responsibilities to protect and enhance shareholders value and financial performance of the Group.
The Board is committed to implement the Malaysian Code on Corporate Governance 2012 (MCCG 2012 or the Code)
wherever applicable in the best interest of the shareholders of the Company.
This corporate governance statement (Statement) sets out how the Company has applied the Principles of the Code and
observed the Recommendations supporting the Principles. Where a specific Recommendation of the MCCG 2012 has not
been observed during the financial year under review, the non-observation, including the reasons thereof and, where
appropriate, the alternative practice, if any, is mentioned in this Statement.
Principle 1 - Establish Clear Roles and Responsibilities
Clear Functions of the Board and Management
The Board assumes full responsibilities for the overall performance of the Company and its subsidiaries by setting the
policies, establishing goals and monitoring the achievement of the goals through strategic action plans and careful
stewardship of the Groups assets and resources.
The Board, in carrying out its stewardship responsibility, has delegated certain responsibilities to the Audit Committee,
Nomination Committee and Remuneration Committee. All committees have clearly defined terms of reference. The
Chairman of various committees will report to the Board the outcome of the committee meetings. The ultimate
responsibility for the final decision on all matters, however, rest with the Board.
Board Duties and Responsibilities
To ensure the effective discharge of its function and duties, the principal responsibilities of the Board include the
following specific areas:
Reviewing and adopting a strategic business plan for the Group;
Overseeing the conduct of the Groups businesses to evaluate whether the businesses are being properly
managed;
Identifying principal risks and ensuring the implementation of appropriate systems to manage these risks;
Succession planning, including appointing, training, fixing of compensation and, where appropriate, replacing
senior management;
Developing and implementing an investor relations programme and shareholders communications policy for the
Group, and
Reviewing the adequacy and integrity of the Groups internal control systems and management information
systems, including systems compliance with applicable laws, regulations, rules, directives and guidelines.
Code of Ethics
The Board has formalised a Directors Code of Ethics, setting out the standards of conduct expected from Directors.
To inculcate good ethical conduct, the Group has established a Code of Conduct for employees.
Sustainability of Business
The Board is mindful/aware of the importance of business sustainability and in conducting the Group business, the
impact on the environment, social and governance aspect is taken in consideration. The Group also embraces
sustainability in its operations.
The Groups activities on corporate social responsibilities for the financial period under review are disclosed under
Additional Compliance Information section of this Annual Report.
41
51
61
71
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Access To Information and Advice
The Board has unrestricted access to all information within the Company and the advices and services of the
Company Secretaries. The Directors may obtain independent professional advice in furtherance of their duties
whenever necessary at the Companys expense.
In additional to the quarterly Board reports, the Board makes public release through Bursa Malaysia Securities Berhad
and kept informed of various requirements and updates issued by various regulatory authorities.
Board members are provided with updates on operational, financial and corporate issues as well as minutes of
meetings of the various Board Committees prior to the meetings to enable Directors to obtain further
explanations/clarifications if necessary, in order to ensure the effectiveness of the proceeding of the meetings.
Qualified and Competent Company Secretaries
The Board is satisfied with the performance and support rendered by the Company Secretaries to the Board in the
discharge of its functions. The Company Secretaries ensures that all Board meetings are properly convened, and that
accurate and proper records of the proceedings and resolutions passed are recorded and maintained in the statutory
register of the Company. The Company Secretaries also keep abreast of the evolving capital market environment,
regulatory changes and developments in corporate governance through continuous training and update the Board
timeously.
Board Charter
During the financial year, the Board has not formalised a Board Charter. The Board recognised its importance and will
take steps to established and develop a Board Charter and Whistle Blowing Policy to comply with the recent changes
of the Code and Main Market Listing Requirements of Bursa Malaysia Securities Berhad. Once approved, these will be
placed at Companys website.
Principle 2 - Strengthen Composition of the Board
During the financial period under review, the Board consisted of ten (10) members comprising of one (1) Executive
Chairman, One (1) Managing Director and two (2) Executive Directors, three (3) Non-Executive Directors and three (3)
Independent Non-Executive Directors. This composition fulfills the requirements as set in the Main Market Listing
Requirements of the Bursa Malaysia Securities Berhad which require that one third (1/3) of the Board members are
Independent Non-Executive Directors. The profile of each Director is presented on page 7 to page 10 of this Annual Report.
The Directors, with their divest backgrounds and specialisations, collectively bring with them a wide range of experience
and expertise in relevant fields such as poultry farming, financing, business administration, corporate planning,
development and marketing which is vital for the strategies success of the Group.
Nomination Committee - Selection and Assessment of Directors
The Nomination Committee is primarily responsible for the proposing of new nominees for the Board and for assessing
the performance of the members of the Board on an on-going basis.
The following are the members of the Nomination Committee:
Mr Frederick Ng Yong Chiang Chairman (Redesignated on 27 August 2013)
Mr Choong Keen Shian Member
Mr Loh Wee Ching Member (Appointed on 27 August 2013)
(The resignation of Mr. Lau Jui Peng was accepted on 27 August 2013)
5.
6.
7.
1.
The duties and responsibilities of the Nomination Committee are as follows:
recommend to the Board of Directors, candidates for directorships to be filled by the shareholders or the Board of
Directors. In making its recommendations, the Nomination Committee should consider the candidates:
skills, knowledge, expertise and experience;
professionalism;
integrity; and
in the case of candidates for the position of Independent Non-Executive Directors, the Committee should also
evaluate the candidates ability to discharge such responsibilities/functions as expected from Independent
Non-Executive Directors;
consider, in making its recommendations, candidates for directorships proposed by the Chief Executive Officer
and, within the bounds of practicability, by any other senior executive or any director or shareholder;
recommend to the Board of Directors, director to fill the seats on Board committees;
assess annually the effectiveness of the Board as a whole, the committees of the Board and the contribution of
each existing individual director by using self and peer assessment approach and thereafter, recommend its
findings to the Board of Directors;
review annually the required mix of skills and experience, succession plans and board diversity, including gender
diversity; training courses for Directors and other qualities, including core competencies which Non-Executive
Directors should bring to the Board and thereafter, recommend its findings to the Board. Insofar as board diversity
is concerned, the Board does not have a specific policy on setting targets for women candidates; and
apply the process determined by the Board of Directors, for assessing the effectiveness of the Board as a whole,
the committees of the Board, and for assessing the contribution of each individual Director, including Independent
Non-Executive Directors, as well as the Chief Executive Officer where all assessments and evaluations carried out
by the Committee in the discharge of all its functions should be properly documented.
Remuneration Committee
The Remuneration Committee is primarily responsible for the development and review of the remuneration policy and
packages for the Board members. The remuneration policy aims to attract and retain Directors necessary for proper
governance and the smooth running of the Company.
The following are the members of the Remuneration Committee:
Mr Choong Keen Shian Chairman (Redesignated on 27 August 2013)
Tan Sri Lau Tuang Nguang Member (Appointed on 27 August 2013)
Mr Loh Wee Ching Member (Appointed on 27 August 2013)
(The resignation of Mr. Lau Jui Peng and Mr. Lau Joo Han was accepted on 27 August 2013)
The duties and responsibilities of the Committee are as follows:
recommend to the Board of Directors, the remuneration of the Executive Directors in all its forms, drawing from
outside advice as necessary and the Executive Directors shall play no part in decisions on their own remuneration.
determination of remuneration packages of Non-Executive Directors, should be determined by the Board of
Directors as a whole and the individuals concerned should abstain from discussing their own remuneration.
The details of Directors' Remuneration payable to the Directors of the Company for the financial year ended 31
December 2013 are as follows:
i.
ii.
iii.
iv.
v.
vi.
i.
ii.
a.
b.
c.
d.
51
Salaries & Other
Fee Emoluments Total
Category (RM) (RM) (RM)
Executive Director 120,000 620,403 740,403
Non-Executive Director 120,000 20,000 140,000
Total 240,000 640,403 880,403
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Principle 3 - Reinforce Independence of the Board
The Board adopted the concept of independence in tandem with the definition of Independent Director of the Main Board
Listing Requirements of Bursa Malaysia Securities Berhad. The Board carries out annual assessment to ensure the
effectiveness of the independence of its Independent Directors. The Board is satisfied with the level of independence
demonstrated by all the Non-Executive Directors, and their ability to act in the best interest of the Company.
The Board acknowledge of the Codes recommendation that the tenure of an Independent Director should not exceed a
cumulative of nine years.
As at the date of this Statement, none of the Independent Directors has exceeded the nine-year independence tenure.
The position of Chairman and Managing Director are held by two different individuals. The Chairman, who is a
non-independent executive director, is responsible for ensuring the adequacy and effectiveness of the Boards governance
process and acts as a facilitator at Board meetings to ensure that contributions from Directors are forthcoming on matters
being deliberated and that no Board members dominates discussion. As the Managing Director, supported by fellow
Executive Directors and an Executive Management team, he implements the Groups strategies, policies and decision
adopted by the Board and oversees the operations and business development of the Group.
Principle 4 - Foster Commitment of Directors
Time Commitment
The Board conducts at least four (4) meetings in each financial year. An annual meeting calendar is prepared and
circulated to the Directors before the beginning of each year to enable the Directors to facilitate in their time planning.
Additional meetings are held as and when required. Scheduled Board meetings are structured with pre-set agenda.
Board and Board Committees papers, which were prepared by Management, provide the relevant facts and analysis
for the convenience of Directors. The meeting agenda, the relevant reports and Board papers are furnished to
Directors and Board Committees members before the meeting to allow the Directors sufficient time to peruse for
effective discussion and decision making during meetings.
The Board is satisfied with the level of time commitment given by the Directors towards fulfilling their roles and
responsibilities. Details of the Board members attendance at Board meeting for the financial year ended 31 December
2013 were as follows:
Name of Director Attendance
Lau Jui Peng 5/5
Nam Yok San 5/5
Na Yok Chee 5/5
Lau Joo Han 4/5
Tan Sri Lau Tuang Nguang 4/5
Dato Zainal Bin Hassan 4/5
Loh Wee Ching 5/5
Dato Koh Low @ Koh Kim Toon 3/5
Choong Keen Shian 4/5
Frederick Ng Yong Chiang 5/5
41
Number of Directors
Executive Non-Executive
Range of Remuneration Director Director Total
Below RM50,000 0 6 6
RM150,001 to RM200,000 4 0 4
Total 4 6 10
Directors Training
In compliance with the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the Directors are
mindful that they shall receive appropriate training which may be required from time to time to keep abreast with the
current developments of the industry as well as the new statutory and regulatory requirements. All the Directors have
completed the Mandatory Accreditation Programme (MAP) as specified by Bursa Malaysia Securities Berhad. The
Directors will continue to receive appropriate training or education to fulfill the Main Market Listing Requirements of
Bursa Malaysia Securities Berhad.
During the financial year ended 31 December 2013, the Directors attended internal briefings by the Company
Secretary on amendments to the Listing Requirements, rules and regulations of relevant authorities and updates on
Financial Reporting Standard by the Group Accountant. Respective Directors have participated in certain seminars,
training programmes during the financial year ended 31 December 2013 which include:
The World Technical School 2013 A Comprehensive Total Poultry Management Course held from 29 April 2013
to 9 May 2013
Accounting for Agriculture-Covering Living Plants and Animals held on 13 May 2013
Practical Aspects of Applying MFRS Seminar held on 4 July 2013
Real Property Gain Tax (RPGT) Latest Developments and Practical Issues held on 5 July 2013
Seminar Percukaian Kebangsaan 2013 held on 11 November 2013
Malaysian Budget 2014 : Highlights and Implications held on 19 November 2013
MIA Conference 2013 held on 26 November 2013 and 27 November 2013
Risk management & Internal Control Workshops for Audit Committee Members held on 2 December 2013
Effective Review of Quarterly Interim Financial Report held on 3 December 2013
2013 Audit Committee Institute Breakfast Roundtable Series held on 19 December 2013
Principle 5 - Uphold Integrity in Financial Reporting
The Board is responsible for ensuring that financial statements prepared for each financial year give a true and fair view of
the Groups state of affairs. The Directors took the due care and reasonable steps to ensure that the requirements of
accounting standards were fully met. Quarterly financial statements were reviewed by Audit Committee and approved by
the Board of Directors prior to their release to Bursa Malaysia Securities Berhad.
The Audit Committee undertakes an annual assessment of suitability and independence of the external auditors. Having
assessed their performance, the Audit Committee will recommend their re-appointment decision to the Board, upon which
the shareholders approval will be sought at the Annual General Meeting.
Principle 6 - Recognise and Manage Risk
The Board regards risk management and internal control as an integral part of the overall management processes in the
Group to safeguard Shareholders investments and the Companys assets. Accordingly, the Directors are obliged to ensure
that the internal control system are existed and practiced within the Group. The Audit Committee assists the Board in
fulfilling this obligation by reviewing the effectiveness and adequacy of the system.
The following key reporting systems and procedures that have been in place within the Group:
regular and comprehensive information provided to management covering financial and cashflow performance.
regular visits to operating units by members of the Board and senior management.
regular internal audit visits, which monitor compliance with procedures and assess the integrity of financial
information.
defined delegation of responsibility to the Board of Directors and Management of the Group including authorisation
level for all aspects of the business.
1.
2.
3.
4.
2.
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Recognising the importance of having risk management processes and practices, the Board has formalised a risk
management framework to enable Management to identify, evaluate, control, monitor and report to the Board the principal
business risk faced by the Group on an ongoing basis, including remedial measures to be taken to address the risks.
Further details relating to the review on internal control system are set out in the Statement on Risk Management and
Internal Control on page 22 to page 23 of the Annual Report.
Principle 7 - Ensure Timely and High Quality Disclosure
To ensure timely and high quality disclosure, the Company has established a corporate disclosure policy to ensure
accurate, clear, timely disclosure of material information. To augment the process of disclosure, the Board has earmarked a
section on the Companys website, where information on the Companys announcements to the regulators, the salient
features of the Board Charter and the Companys Annual Report may be accessed.
Principle 8 - Strengthen relationship between the Company and its Shareholders
Shareholders participation at general meeting
The Annual General Meeting (AGM) is the principal forum for dialogue and interaction with shareholders. At the AGM,
the Board provides opportunities for shareholders to raise questions pertaining to the business activities of the Group.
The Chairman and where appropriate, the Executive Director and External Auditors are available to provide
explanations on queries raised during the meetings as well as to discuss with Shareholders, invited attendees and
members of the press. Shareholders who are unable to attend are allowed to appoint proxies to attend and vote on
their behalf. The Notice of AGM is circulated at least twenty-one (21) days before the date of the meeting to enable
shareholders to go through the Annual Report and papers supporting the resolutions proposed.
Poll Voting
The Board noted the Recommendation 8.2 of the MCCG 2012 states that the board should encourage poll voting. In
line with this recommendation, the Executive Chairman will inform the shareholders of their rights to demand poll vote
at the commencement of the general meeting.
Communication and Engagement with Shareholders and Prospective Investors
The Group recognises the need to inform the shareholders of all significant developments concerning the Group on a
timely basis with strict adherence to the Main Market Listing Requirements of Bursa Malaysia Securities Berhad.
Shareholders and prospective investors are kept informed of all major development within the Group by way of
announcements via the Bursa Link, the Companys Annual Reports, website and other circulars to shareholders with
an overview of the Teo Seng Groups financial and operational performance. The Company always maintains
transparency in business activities and to continuously keep the shareholders and the prospective investors well
informed on the Companys activities.
Additional Compliance Information
Compliance With The Code
The Board considers that the Group has complied substantially with the principles and recommendations as stipulated in
the MCCG 2012 throughout the financial year 2013. The Board will endevour to improve and enhance the procedures from
time to time.
1.
2.
3.
4.
Corporate Social Responsibility
Our Group believes the improvement in the conditions surrounding our stakeholders, employees, society and the
environment is vital to the growth of the Group. Our corporate social responsibility covers the following keys areas:-
Employee welfare and development
Company provided training to the employees. The training comprises both technical and soft skills. For the financial
year ended 31 December 2013, employees of Ritma Prestasi Sdn Bhd attended Baytril seminar held at Ciao Ristorante
on 21 July 2013 and training on Intermediate Excel Program held at the corporate office of Teo Seng Capital Berhad on
17 July 2013 and 18 July 2013 respectively.

Apart from training, employees are also provided with medical and healthcare insurance, adequate and compensation
programs which commensurate with their rank and level of employments. Further, the Group acknowledges the needs
to provide a healthy and balanced lifestyle to its employees. In this aspect, various initiatives, such as annual dinner
and social events were organised by our major subsidiary throughout the year. Through these programmes, we aim to
attract and maintain various talents in our Company.
Occupational health and safety
The Group is committed to provide and ensure a safe and healthy environment at all times. It continues to implement
various ongoing health and safety programmes to educate employees on various aspects of safety practices. As Teo
Seng Group recognises the importance of the greenery, our employees are working in an environment that is close to
the mother of nature. The Group will continue to emphasize on the importance of health and safety at the work place.
Providing Opportunities for Re-Employment of Retirees
Company provides re-employment opportunities for employees or people who have passed their retirement age and
who wish to continue working.
Community
During the financial year, we had donated in monetary form to a diverse range of worthy causes, including educational
institutions and organisations that required assistance.
In this financial year, we had our Corporate Social Responsibility Programme at Yong Peng High School, Johor on 3
November 2013. In conjunction with Yong Peng High School Bazaar Sales, we sponsored fresh eggs and our brand
eggs Happy Egg to Yong Peng High School and our volunteered employees helped the students at the Bazaar to sell
the eggs for their education fund raising.
Papers Recycle
We fully recognise the preservation of nature and the global ecosystem is vital for the happiness and survival of the
humanity into the future. We collected waste papers such as old magazines, old newspapers and used carton boxes
for Teo Seng Paper Products Sdn. Bhd., a wholly owned subsidiary of Teo Seng Capital Berhad to manufacture and
market the environmental friendly paper egg trays.
DIRECTORS' REPONSIBILITIES STATEMENT
The Directors are responsible to ensure that financial statements are drawn up in accordance with the provisions of the
Companies Act, 1965 and applicable approved accounting standards in Malaysia.
In preparation of financial statement for the year ended 31 December 2013, the Directors are also responsible for the
adoption of suitable accounting policies and their consistent use in the financial statements supported where necessary by
reasonable and prudent judgments.
1.
2.
3.
4.
5.
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Capital Berhad
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Capital Berhad
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OTHER INFORMATION
Share Buybacks
The Company did not engage in any share buyback arrangement during the financial year ended 31 December 2013.
Depository Receipt Programme (DRP)
The Company did not sponsor any DRP during the financial year ended 31 December 2013.
Profit Guarantee
During the financial year, there was no profit guarantee given by the Company.
Options, Warrants or Convertible Securities
The Company has not issued any options, warrants or convertible securities during the financial year ended
31 December 2013.
Sanctions and/or Penalties
There were no major sanctions and/or penalties imposed on the Company or its subsidiaries, Directors or management by
the relevant regulatory bodies during the financial year.
Non-Audit Fees
The amount of non-audit fees paid to the external auditors is RM4,200 for the financial year ended 31 December 2013.
Variation in Results
No variances of more than 10% between the audited results for the financial year ended 31 December 2013 and the
unaudited results previously announced.
Material Contracts
There were no material contracts entered into or subsisting between the Company and its subsidiaries involving directors'
and major shareholders' interest during the financial year ended 31 December 2013.
Recurrent Related Party Transactions of a Revenue Nature
The details of the recurrent related party transactions of revenue or trading in nature undertaken by the Company during
the financial year are disclosed in Note 30 to the financial statements.
Revaluation Policy
The Groups revaluation policy on landed properties are stated in Note 4.2 (d) to the financial statements.
Utilisation of Proceeds
No proceeds were raised by the Company from any corporate proposals during the financial year ended
31 December 2013.
This statement on Corporate Governance is made in accordance with the minutes of the Board of Directors' Meeting on 26
May 2014.
Statement Of Risk Management
And Internal Control
Boards Responsibilities
The Board acknowledges its responsibility for Groups system of risk management, internal control and for reviewing its
effectiveness whilst the role of the management is to implement the Boards policies on risk management and control
effectiveness.
Due to limitation inherent in any internal control system, internal control in Teo Seng Capital Berhad is designed to manage
rather than eliminate the risk of failure to achieve the overall business objective. It noted that internal control can only
provide reasonable but not absolute against material misstatement or loss regarding:
The safeguarding of Groups assets against unauthorized use or disposition
The maintenance of proper accounting records and the reliability of financial information used within the business or
for publication.
The Board confirms that there is a continuous process for identifying, evaluating and managing the significant risks faced
by the Group which was put in place in the current financial year under review.
The process is regularly reviewed by the Board and is in accordance with the guideline as contained in the publication
Statement on Risk Management and Internal Control: Guidelines for Directors of Public Listed Company, as referred to in
Practice Note 9 Internal Control and Corporate Government Statement of the Main Market Listing Requirements and
Guidance Note 11 Internal Control and Corporate Statement of the Ace Market Listing Requirements of Bursa Malaysia
Securities Berhad, replaces the Statement on Internal Control Guidance for Directors of Public Listed companies
issued in December 2000.
Risk Management Framework
The Board acknowledges that all areas of the Teo Seng Groups business activities involve some degree of risk. The Teo
Seng Group is committed to ensuring that there is an effective risk management framework which allows management to
manage risks within defined parameters and standards, and promotes profitability of the Teo Seng Groups operations in
order to enhance shareholder value.
Management is responsible for creating a risk-aware culture within the Teo Seng Group and for the identification and
evaluation of significant risks applicable to their areas of business, together with the design and operation of suitable
internal controls. Where areas for improvement in the system are identified, the Board considers the recommendations
made by the Audit Committee and the internal auditors.
The Board will pursue its ongoing process of identifying, assessing and managing key business, operational and financial
risks faced by its business units as well as regularly reviewing planned strategies to determine whether risks are mitigated
and well-managed, and to ensure compliance with the guidelines issued by the relevant authorities. This is to ensure the
Teo Seng Group is able to respond effectively to the constantly changing business environment in order to protect and
enhance stakeholders interests and shareholder value.
The professionalism and competency of staff are enhanced through a proper planned training, development programed
and also a stringent recruitment process. A performance appraisal system of staff is in place, with established targets and
accountability and is reviewed on an annual basis. Action plans are prepared to ensure that staff obtains required skills to
execute their responsibilities.
The Company has its own Code of Conducts for Officers and Staffs issued upon joining. Staffs are required to strictly
adhere to the Code in performing their duties.
Key Processes
The process of governing the effective and integrity of the system of the internal controls is carried throughout the various
areas as follows, this is in accordance to para 41 of the Statement on Risk Management & Internal Control: Guidelines for
Directors of Listed Issuers, the process it has applied to deal with material internal control aspects of any significant
problems disclosed in the annual report and financial statement.
Internal Audit Function
The Internal Auditor reports to the Audit Committee and performed a scheduled reviews of operations and compliance with
policies and procedures to assess effectiveness of internal controls. The Audit Committee reviews and scrutinizes reports
issued by the Internal Audit and conducts its own assessment on the adequacy of Internal Auditors scope of work and
resources annually.
(a)
(b)
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Capital Berhad
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Statement Of Risk Management And Internal Control
Teo Seng
Capital Berhad
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The Internal Auditor summits the audit findings and recommendations to improve the internal controls to the Board of Audit
Committee for reviews, response and implementation of any corrective actions, which will enhance the internal control
aspects of the relevant areas under review.
The internal audit fees incurred for the assignments conducted for the Group is RM15,000 for the financial year under
reviewed.
Other Key Areas of Internal Control
The following are other key areas of the Groups internal control system:
The Board reviews quarterly reports from Management on the key operating performance, legal, environmental and
regulatory matters. Financial performance is deliberated at the Management Committee and also tabled to the Board on a
quarterly basis.
Limit of Authority provide a sound framework of authority and accountability within the organization and to facilitate quality
and timely corporate decision making at the appropriate level in the organizations hierarchy.
Internal control procedures are documented in comprehensive standard operating procedures manuals with established
guidelines on business planning, capital expenditures, financial operations, performance reporting, human resource and
health, safety and environment.
There were no material internal control failures or have any of the reported weaknesses resulted in material losses or
contingencies during the financial year.
The Board has received assurance from the Managing Director and Financial Controller that the Groups risk management
and internal control system is operating adequately and effectively, in all material aspect based on the risk management
and internal control system of the Company.
Review by External Auditors
The external auditors have reviewed the Statement On Risk Management and Internal Control pursuant to Paragraph 15.23
of the Main Market Listing Requirements of Bursa Malaysia Securities Berhad and have reported to the Board that it is
appropriately reflects the processes that the Board has adopted in reviewing the adequacy and integrity of the system of
risk management and internal controls.
Conclusion
The Board is of the view that the system of internal controls being instituted throughout Teo Seng Group is sound
and effective.
For the financial year under review and up to the date of this report, the Board is satisfied with the Groups system of
risk management and internal control and will continue to review the adequacy and integrity of the Groups internal
control. There are no material losses, contingencies and or uncertainties that have arisen from any inadequacy or failure
of the Groups system of risk management and internal control that would require separate disclosure in the Groups
Annual Report.
This is also to comply with para 41 of the Statement on Risk Management & Internal Control: Guidelines for Directors of
Listed Issuers that the process (or where applicable, through its committees) has applied in reviewing the risk management
and internal control system and confirming that necessary actions have been or are being taken to remedy any significant
failings or weaknesses identified from that review.
This Satement of Risk Management and Internal Contol is made in accordance with the minutes of the Board of Directors'
Meeting on 26 May 2014.
Audit Committees Report
The members of the Audit Committee as at the date of this report are as follows:
Chairman
Choong Keen Shian Independent Non-Executive Director
Members
Frederick Ng Yong Chiang Independent Non-Executive Director
Dato Koh Low @ Koh Kim Toon Independent Non-Executive Director
Tan Sri Lau Tuang Nguang (Appointed on 27 August 2013) Non-Executive Director
Lau Jui Peng (Resigned on 27 August 2013) Executive Chairman
TERMS OF REFERENCE
Composition of the Audit Committee
The Audit Committee shall be appointed by the Board from amongst their numbers, which fulfils the following
requirements:-
The Audit Committee must be composed of no fewer than 3 members. In the event of any vacancy in the Audit
Committee resulting in the non-compliance of the above, the Company must fill the vacancy within 3 months.
All the Audit Committee members must be financially literate, with at least one member:-
must be a member of the Malaysian Institute of Accountants; or
if he is not a member of the Malaysian Institute of Accountants, he must have at least 3 years' working experience and:
he must have passed the examinations specified in Part I of the 1st Schedule of the Accountants Act 1967; or
he must be a member of one of the associations of accountants specified in Part II of the 1st Schedule of the
Accountants Act 1967; or
fulfils such other requirements as prescribed or approved by the Exchange.
No alternate director shall be appointed as a member of the Audit Committee.
The member of the Audit Committee shall elect a Chairman from among themselves who shall be an Independent
Director. The Chairman of the Audit Committee should engage on a continuous basis with senior management, the
head of internal audit and the external auditors in order to be kept informed of matters affecting the company.
All members of the Audit Committee, including the Chairman, will hold office only so long as they serve as Directors of the
Company. The Board must review the term of office and performance of the Audit Committee and each of its members at
least once every three (3) years to determine whether the Audit Committee has carried out its duties in accordance with its
terms of reference.
Secretary of the Audit Committee
The Company Secretaries of the Company shall be the Secretaries of the Audit Committee.
Duties and Responsibilities of the Audit Committee
The following are the main duties and responsibilities of the Audit Committee collectively:
Review the following and report the same to the Board of the Company:
with the external auditors, the audit plan;
with the external auditors, his evaluation of the system of internal controls;
with the external auditors, his audit report;
the assistance given by the employees of the Company to the external auditors and the internal auditors;
the adequacy of the scope, functions, competency and resources of the internal audit functions and that it has the
necessary authority to carry out its work;
(1)
(2)
(3)
(4)
(1)
(i)
(ii)
(iii)
(i)
(ii)
(iii)
(iv)
(v)
(a)
(b)
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the internal audit programme, processes, the results of the internal audit programme, processes or investigation
undertaken and whether or not appropriate action is taken on the recommendations of the internal audit function;
the quarterly results and year end financial statements, prior to the approval by the Board, focusing particularly on:
changes in or implementation of major accounting policy changes;
significant and unusual events; and
compliance with accounting standards and other legal requirements;
any related party transaction and conflict of interest situation that may arise within the Company or Group
including any transaction, procedure or course of conduct that raises questions of management integrity;
any letter of resignation from the external auditors and any questions of resignation or dismissal; and
whether there is reason (supported by grounds) to believe that the Company's external auditor is not suitable for
re-appointment;
Oversee the Companys internal control structure to ensure operational effectiveness and efficiency, reduce risk of
inaccurate financial reporting, protect the Companys assets from misappropriation and encourage legal and
regulatory compliance;
Assist the Board in identifying the principal risks in the achievement of the Companys objectives and ensuring the
implementation of appropriate systems to manage these risks;
Recommend to the Board on the appointment and re-appointment of the external auditors and their audit fee, after
taking into consideration the independence and objectivity of the external auditors and the cost effectiveness of the
audit;
Discuss with the external auditors before the audit commences the nature and scope of the audit and ensure
co-ordination where more than one audit firm is involved;
Discuss problems and reservations arising from the audits and any matter the auditors may wish to discuss in the
absence of the management where necessary;
Review the external auditors management letter and managements response therein;
In relation to the internal audit function:-
review the adequacy of the scope, functions and resources of the internal audit function, and that it has the
necessary authority to carry out its work;
review the internal audit programme and results of the internal audit process and, where necessary, ensure that
appropriate actions are taken on the recommendations of the internal audit function;
review any appraisal or assessment of the performance of members of the internal audit function;
approve any appointment or termination of senior staff members of the internal audit function; and
take cognisance of resignations of internal audit staff members and provide the resigning staff member an
opportunity to submit his reasons for resigning.
Consider the major findings of internal investigations and managements response; and
Consider other matters as defined by the Board.
(vi)
(vii)
(viii)
(ix)
(x)
(a)
(b)
(c)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(i)
(ii)
(iii)
(iv)
(v)
(1)
(2)
(3)
(4)
(5)
(6)
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
(9)
(10)
(11)
Rights of the Audit Committee
In carrying out its duties and responsibilities, the Audit Committee will:
have the authority to investigate any matter within its terms of reference;
have the resources which are required to perform its duties;
have full and unrestricted access to any information pertaining to the Company;
have direct communication channels with the external auditors and person(s) carrying out the internal audit function or
activity;
be able to obtain independent professional or other advice and to invite outsiders with relevant experience and
expertise to attend the Audit Committee meetings (if required) and to brief the Audit Committee; and
be able to convene meetings with the external auditors, the internal auditors or both, excluding the attendance of
other directors and employees of the Company, whenever deemed necessary.
Conduct of Meetings
The Audit Committee will meet at least four (4) times in each financial year although additional meetings may be called
at any time, at the discretion of the Chairman of the Audit Committee.
The quorum shall consist of a majority of Independent committee members and shall not be less than two.
Recommendations to the Audit Committee are submitted to the Board for approval.
The Company Secretaries shall be in attendance at each Audit Committee meeting and record the proceedings of the
meeting thereat.
Minutes of each meeting shall be kept as part of the statutory record of the Company upon confirmation by the Board
and a copy shall be distributed to each member of the Audit Committee.
The Managing Director and other appropriate officer may be invited to attend where their presence are considered
appropriate as determined by the Audit Committee Chairman.
The internal auditors and/or external auditors have the right to appear and be heard at any meeting of the Audit
Committee and are recommended to attend each Audit Committee meeting.
Upon the request of the internal auditors and/or external auditors, the Audit Committee Chairman shall also convene a
meeting of the Audit Committee to consider any matter the auditor(s) believes should be brought to the attention of the
Board or the shareholders.
The Audit Committee must be able to convene meetings with external auditors without the presence of the executive
board members and management at least twice a year and whenever deemed necessary.
Where the Audit Committee is of the view that a matter reported by it to the Board has not been satisfactorily resolved
resulting in a breach of Main Market Listing Requirements of Bursa Malaysia Securities Berhad, the Audit Committee
must promptly report such matter to Bursa Malaysia Securities Berhad.
The attendance of any particular Audit Committee meeting by other directors and employees of the Company shall be
at the Audit Committees invitation and discretion and must be specific to the relevant meeting.
Teo Seng
Capital Berhad
26
Annual
Report
2013
Teo Seng
Capital Berhad
27
Annual
Report
2013
Attendance at Meetings
Details of the attendance of the Committee members for the financial year ended 31 December 2013 are as follows:
Name of member Number of meetings attended
Choong Keen Shian 4/5
Frederick Ng Yong Chiang 4/5
Dato Koh Low @ Koh Kim Toon 3/5
Tan Sri Lau Tuang Nguang (Appointed on 27 August 2013) 1/1
Lau Jui Peng (Resigned on 27 August 2013) 4/4
The Financial Controller, Group Accountant and/or internal auditors shall attend the meetings upon invitation by the
Chairman of the Committee. However, at least once a year a Committee shall meet the external auditors.
Summary of Activities during the Financial Year
The main activities undertaken by the Committee were as follows:
Reviewed the external auditors scope of work and the audit plans for the year prior to the commencement of audit.
Reviewed the internal audit departments resources requirements, programme and plan for the financial year under
review.
Reviewed the internal audit reports, which highlighted the risk issues, recommendations and managements response.
Reviewed the audited financial statements of the Group prior to submission to the Board for their consideration and
approval. The review was to ensure that the audited financial statements were drawn up in accordance with applicable
approved accounting standards for entities other than private entities issued by the Malaysian Accounting Standards
Board (MASB) and the provisions of the Companies Act, 1965.
Reviewed the Groups compliance in particular the quarterly and year end financial statements with the Main Market
Listing Requirements of the Bursa Malaysia Securities Berhad, MASB and other relevant legal and regulatory
requirements.
Reviewed the quarterly unaudited financial results announcements before recommending them for the Boards
approval. The review and discussions were conducted with the Financial Controller and Group Accountant.
Internal audit function
The Group has outsourced its internal audit function to its intermediate holding company, which is tasked with the aim of
providing assurance to the Audit Committee and the Board on the adequacy and effectiveness of the internal control
systems and risk management in the Group. The cost of RM15,000 was incurred for the internal audit function for the year
This function also acts as a source to assist the Audit Committee and the Board to strengthen and improve current
management and operating style in pursuit of best practices.
This Audit Committee Report is made in accordance with the minutes of the Board of Directors' Meeting on 26 May 2014.
30 Directors' Report
35 Statement by Directors
35 Statutory Declaration
36 Independent Auditors' Report
38 Statements of Financial Position
39 Statements of Proft or Loss and
Other Comprehensive Income
40 Statements of Changes in Equity
41 Statements of Cash Flows
43 Notes to the Financial Statements
F
i
n
a
n
c
i
a
l

S
t
a
t
e
m
e
n
t
s
Directors Report
The directors have pleasure in submitting their report together with the audited financial statements of the Group and of the
Company for the financial year ended 31 December 2013.
PRINCIPAL ACTIVITIES
The Company is principally engaged in the business of investment holding and provision of management services. The
principal activities of the subsidiaries are set out in Note 7 to the financial statements.
There have been no significant changes in the nature of these principal activities during the financial year.
RESULTS
Group Company
RM RM

Profit after tax for the financial year 23,375,313 13,370,403
Attributable to :
Owners of the Company 23,424,028 13,370,403
Non-controlling interests (48,715) -
23,375,313 13,370,403
In the opinion of the directors, the results of the operations of the Group and of the Company during the financial year have
not been substantially affected by any item, transaction or event of a material and unusual nature.
DIVIDENDS
Dividend paid or declared by the Company since the end of the previous financial period were as follows :
An interim single tier dividend of 5.0% equivalent to 1.0 sen per ordinary share amounting to RM 2,000,000 in respect of
the financial year ended 31 December 2013 was declared on 27 August 2013 and subsequently paid on 20 September
2013. The payment was made to the shareholders whose name appeared on the Companys Records of Depositors on 11
September 2013.
A final single tier dividend of 7.5% equivalent to 1.5 sen per ordinary share amounting to RM 3,000,000 in respect of the
current financial year will be proposed for shareholders approval at the forthcoming Annual General Meeting. The financial
statements for the current financial year do not reflect this proposed dividend. Such dividend, if approved by the
shareholders, will be accounted for as a liability in the financial year ending 31 December 2014.
RESERVES AND PROVISIONS
There was no material transfers to or from reserves and provisions during the financial year save as disclosed in the
financial statements.
ISSUES OF SHARES AND DEBENTURES
There was no issue of shares and debentures during the financial year.
Teo Seng
Capital Berhad
30
Annual
Report
2013
Directors Report
Teo Seng
Capital Berhad
31
Annual
Report
2013
OPTIONS GRANTED OVER UNISSUED SHARES
No options have been granted by the Company to any person to take up any unissued shares of the Company during the
financial year.
HOLDING COMPANIES
The Company is a subsidiary of Advantage Valuations Sdn. Bhd.. The directors regard Leong Hup Holdings Sdn. Bhd. as
its intermediate holding company and Emerging Glory Sdn. Bhd. as its ultimate holding company. These holding
companies are incorporated in Malaysia.
DIRECTORS
The directors who served since the date of last report are :
Lau Jui Peng
Lau Joo Han
Nam Yok San
Na Yok Chee
Loh Wee Ching
Choong Keen Shian
Dato Zainal Bin Hassan
DIRECTORS INTERESTS
According to the register of directors shareholdings, the interests of directors holding office at the end of the financial year
in shares of the Company and its related corporations during the financial year are as follows :
The Company
Number Of Ordinary Shares Of RM0.20 Each
Balance At Balance At
01.01.2013 Bought Sold 31.12.2013
Tan Sri Lau Tuang Nguang - Indirect 212,800 - - 212,800
Lau Jui Peng - Indirect 115,581,738 - (10,850,900) 104,730,838
Nam Yok San - Indirect 102,254,001 - - 102,254,001
Na Yok Chee - Direct 1,450 - - 1,450
- Indirect 102,246,001 - - 102,246,001
Directors Report
01.01.2013 Bought Sold 31.12.2013
Tan Sri Lau Tuang Nguang - Direct 1 - - 1
Lau Jui Peng - Indirect 5,097 - - 5,097
Nam Yok San - Indirect 4,900 - - 4,900
Na Yok Chee - Indirect 4,900 - - 4,900

Intermediate Holding Company Leong Hup Holdings Sdn. Bhd.
01.01.2013 Bought Sold 31.12.2013
Lau Jui Peng - Indirect 2 - - 2
Ultimate Holding Company Emerging Glory Sdn. Bhd.
01.01.2013 Bought Sold 31.12.2013
Tan Sri Lau Tuang Nguang - Direct 14,999 - - 14,999
Lau Jui Peng - Indirect 20,002 - - 20,002
Lau Joo Han - Direct 10,001 - - 10,001
The other directors holding office at the end of the financial year had no interest in shares of the Company or its related
corporations during the financial year.

DIRECTORS BENEFITS
Since the end of the previous financial period, no directors has received or become entitled to receive any benefit (other
than benefits included in the aggregate amount of emoluments received or due and receivable by the directors as
disclosed in Note 21(a) to the financial statements) by reason of a contract made by the Company or a related corporation
with the director or with a firm of which the director is a member, or with a company in which the director has a substantial
financial interest except for any benefits which may be deemed to arise from transactions entered into in the ordinary
course of business with companies in which certain directors have substantial financial interest save as disclosed in Note
30(b) to the financial statements.
Neither during nor at the end of the financial year was the Group or the Company a party to any arrangements whose
object is to enable the directors to acquire benefits by means of the acquisition of shares in, or debentures of the Company
or any other body corporate.
DIRECTORS INTERESTS (contd)
Immediate Holding Company Advantage Valuations Sdn. Bhd.
Teo Seng
Capital Berhad
32
Annual
Report
2013
Directors Report
Teo Seng
Capital Berhad
33
Annual
Report
2013
OTHER STATUTORY INFORMATION
Before the financial statements of the Group and of the Company were made out, the directors took reasonable steps :
to ascertain that action had been taken in relation to the writing off of bad debts and the making of allowance for
impairment losses on receivables, and satisfied themselves that all known bad debts had been written off and that
adequate allowance had been made for impairment losses on receivables ; and
to ascertain that any current assets other than debts, 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.
At the date of this report, the directors are not aware of any circumstances :
that would require the further writing off of bad debts, or the additional allowance for impairment losses on
receivables in the financial statements of the Group and of the Company ; or
which would render the values attributed to current assets in the financial 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 ; or
not otherwise dealt with in this report or financial statements of the Group and of the Company which would
render any amount stated in the financial statements misleading.

At the date of this report, there does not exist :
any charge on the assets of the Group and of the Company that has arisen since the end of the financial year and
which secures the liabilities of any other persons ; or

any contingent liability in respect of the Group and of the Company which has arisen since the end of the financial
year.
In the opinion of the directors :
no contingent or other liability of the Group and of the Company have become enforceable or is likely to become
enforceable within the period of twelve months after the end of the financial year which, will or may substantially
affect the ability of the Group and of the Company to meet their obligations when they fall due ; and
there has not arisen in the interval between the end of the financial year and the date of this report any item,
transaction or event of a material and unusual nature likely, to affect substantially the results of the operations of
the Group and of the Company for the financial year in which this report is made.
SIGNIFICANT EVENT DURING THE FINANCIAL YEAR
The significant event during the financial year is disclosed in Note 32 to the financial statements.
(a)
(b)
(c)
(d)
(i)
(ii)
(i)
(ii)
(iii)
(iv)
(i)
(ii)
(i)
(ii)
Directors Report
AUDITORS
The auditors, Messrs. Crowe Horwath, have expressed their willingness to continue in office.
Signed on behalf of the Board in accordance with a resolution of the directors :
LAU JUI PENG
Director
NAM YOK SAN
Director
Muar, Johor Darul Takzim
Date :
Teo Seng
Capital Berhad
34
Annual
Report
2013
Statement By Directors
Teo Seng
Capital Berhad
35
Annual
Report
2013
Statutory Declaration
We, the undersigned, being two of the directors of Teo Seng Capital Berhad, do hereby state that, in the opinion of the
directors, the financial statements set out on pages 38 to 96 are drawn up in accordance with Financial Reporting
Standards and the requirements of the Companies Act, 1965 in Malaysia so as to give a true and fair view of the financial
position of the Group and of the Company at 31 December 2013 and of their financial performance and cash flows for the
financial year ended on that date.
The supplementary information set out in Note 34, which is not part of the financial statements, is prepared in all material
respects, in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or
Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by the
Malaysian Institute of Accountants and the directive of Bursa Malaysia Securities Berhad.
Signed on behalf of the Board in accordance with a resolution of the directors:
LAU JUI PENG
Director
NAM YOK SAN
Director
Date :
I, NAM YOK SAN, the director primarily responsible for the financial management of Teo Seng Capital Berhad, do solemnly
and sincerely declare that the financial statements and supplementary information set out on pages 38 to 97 are to the best
of my knowledge and belief, 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 NAM YOK SAN at
Muar in the state of Johor Darul Takzim
on
Before me: NAM YOK SAN
Commissioner for Oaths
Independent Auditors Report
To The Members Of Teo Seng Capital Berhad
REPORT ON THE FINANCIAL STATEMENTS
We have audited the financial statements of Teo Seng Capital Berhad, which comprise statements of financial position at 31
December 2013 of the Group and of the Company, and the statements of profit or loss and other comprehensive income,
statements of changes in equity and statements of cash flows of the Group and of the Company for the financial year then
ended, and a summary of significant accounting policies and other explanatory information, as set out on pages 38 to 96.
Directors Responsibility For The Financial Statements
The directors of the Company are responsible for the preparation of financial statements so as to give a true and fair view
in accordance with Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia. The
directors are also responsible for such internal control as the directors determine is necessary to enable the preparation of
financial statements that are free from material misstatement, whether due to fraud or error.
Auditors Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in
accordance with approved standards on auditing in Malaysia. Those standards require that we comply with ethical
requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are
free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial
statements. The procedures selected depend on our judgement, including the assessment of risks of material
misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, we consider
internal control relevant to the entitys preparation of financial statements that give a true and fair view in order to design
audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entitys internal control. An audit also includes evaluating the appropriateness of accounting policies
used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation
of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Opinion
In our opinion, the financial statements give a true and fair view of the financial position of the Group and of the Company
at 31 December 2013 and of their financial performance and cash flows for the financial year then ended in accordance
with Financial Reporting Standards and the requirements of the Companies Act, 1965 in Malaysia.
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS
In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following :
In our opinion, the accounting and other records and the registers required by the Act to be kept by the Company and
its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the
Act.
We have considered the financial statements and the auditors report of subsidiary of which we have not acted as
auditors, which are indicated in Note 7 to the financial statements.
(a)
(b)
Teo Seng
Capital Berhad
36
Annual
Report
2013
Independent Auditors Report
To The Members Of Teo Seng Capital Berhad
Teo Seng
Capital Berhad
37
Annual
Report
2013
We are satisfied that the financial statements of the subsidiaries that have been consolidated with the Companys
financial statements are in form and content appropriate and proper for the purposes of the preparation of the financial
statements of the Group and we have received satisfactory information and explanations required by us for those
purposes.
The auditors reports on the financial statements of the subsidiaries did not contain any qualification or any adverse
comment made under Section 174(3) of the Act.
OTHER REPORTING RESPONSIBILITIES
The supplementary information set out in Note 34 on page 97 is disclosed to meet the requirement of Bursa Malaysia
Securities Berhad and is not part of the financial statements. The directors are responsible for the preparation of the
supplementary information in accordance with Guidance on Special Matter No. 1, Determination of Realised and
Unrealised Profits or Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing
Requirements, as issued by the Malaysian Institute of Accountants (MIA Guidance) and the directive of Bursa Malaysia
Securities Berhad. In our opinion, the supplementary information is prepared, in all material respects, in accordance with
the MIA Guidance and the directive of Bursa Malaysia Securities Berhad.
OTHER MATTERS
This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies
Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this
report.
Crowe Horwath
Firm No.: AF 1018
Chartered Accountants
Ng Kim Hian
Approval No.: 2506/04/15 (J)
Chartered Accountant
Date :
(c)
(d)
Statements Of Financial Position
At 31 December 2013
Group Company
Note 2013 2012 2013 2012
RM RM RM RM

ASSETS
Non-Current Assets
Property, plant and equipment 5 142,898,788 132,006,490 803,916 858,081
Investment property 6 - 462,530 - -
Investment in subsidiaries 7 - - 68,174,607 68,174,607
Other investment 8 6,550 5,390 - -
Long term receivable 9 - - 3,950,890 3,662,545
Deferred tax assets 10 303,000 - - -
143,208,338 132,474,410 72,929,413 72,695,233
Current Assets
Inventories 11 41,228,277 41,492,007 - -
Trade and other receivables 9 38,099,673 35,805,743 1,676,390 1,323,144
Derivative assets 12 16,725 - - -
Deposits, bank and cash balances 13 35,656,050 17,857,144 440,200 176,586
115,000,725 95,154,894 2,116,590 1,499,730

TOTAL ASSETS 258,209,063 227,629,304 75,046,003 74,194,963
EQUITY AND LIABILITIES
Equity
Share capital 14 40,000,000 40,000,000 40,000,000 40,000,000
Reserves 15 92,613,525 71,207,642 34,201,268 22,830,865
Equity Attributable To Owners Of The Company 132,613,525 111,207,642 74,201,268 62,830,865
Non-controlling interests (70,270) (21,555) - -
TOTAL EQUITY 132,543,255 111,186,087 74,201,268 62,830,865
Non-Current Liabilities
Bank borrowings 16 1,760,909 2,663,865 - -
Hire purchase payables 17 2,989,140 6,181,274 - -
Deferred tax liabilities 10 8,590,000 7,016,104 - -
13,340,049 15,861,243 - -
Current Liabilities
Trade and other payables 18 29,854,353 24,261,160 844,735 11,364,098
Bank borrowings 16 74,827,917 67,565,446 - -
Hire purchase payables 17 6,111,265 7,960,813 - -
Tax payable 1,532,224 794,555 - -
112,325,759 100,581,974 844,735 11,364,098
TOTAL LIABILITIES 125,665,808 116,443,217 844,735 11,364,098

TOTAL EQUITY AND LIABILITIES 258,209,063 227,629,304 75,046,003 74,194,963
Teo Seng
Capital Berhad
38
Annual
Report
2013
Statements Of Profit Or Loss And Other Comprehensive Income
For The Financial Year Ended 31 December 2013
Teo Seng
Capital Berhad
39
Annual
Report
2013
Group Company
9 Months 9 Months
Financial Financial Financial Financial
Year Ended Period Ended Year Ended Period Ended
31 December 31 December 31 December 31 December
2013 2012 2013 2012
Note RM RM RM RM
REVENUE 19 330,758,830 197,535,030 15,748,000 3,784,000
INVESTMENT REVENUE 20 60,073 71,669 39,123 42,715
OTHER INCOME 2,928,994 1,951,994 - -
CHANGES IN INVENTORIES (266,685) 6,769,284 - -
PURCHASE OF TRADING MERCHANDISE, RAW
MATERIALS, LIVESTOCKS AND POULTRY FEEDS (225,864,091) (153,834,290) - -
STAFF COSTS 22 (35,191,638) (18,969,544) (1,380,446) (458,970)
DEPRECIATION (10,513,275) (7,733,853) (97,184) (58,844)
FINANCE COSTS 23 (4,088,155) (2,755,423) (373,607) (267,060)
OTHER EXPENSES (27,862,977) (21,892,205) (518,483) (471,381)
PROFIT BEFORE TAX 24 29,961,076 1,142,662 13,417,403 2,570,460
TAX EXPENSE 25 (6,585,763) (565,417) (47,000) (44,851)
PROFIT AFTER TAX 23,375,313 577,245 13,370,403 2,525,609
OTHER COMPREHENSIVE INCOME
Items that may be reclassified subsequently to profit
or loss
- Fair value changes of available-for-sale financial assets 1,160 (650) - -
- Foreign currency translation differences (19,305) (67,537) - -
TOTAL OTHER COMPREHENSIVE INCOME (18,145) (68,187) - -
TOTAL COMPREHENSIVE INCOME FOR THE
FINANCIAL YEAR/PERIOD 23,357,168 509,058 13,370,403 2,525,609
PROFIT AFTER TAX ATTRIBUTABLE TO :
Owners of the Company 23,424,028 773,244 13,370,403 2,525,609
Non-Controlling Interests (48,715) (195,999) - -
23,375,313 577,245 13,370,403 2,525,609
TOTAL COMPREHENSIVE INCOME
ATTRIBUTABLE TO :
Owners of the Company 23,405,883 705,057 13,370,403 2,525,609
Non-Controlling Interests (48,715) (195,999) - -
23,357,168 509,058 13,370,403 2,525,609

EARNINGS PER ORDINARY SHARE (SEN) 26
Basic 11.71 0.39
Diluted Not applicable Not applicable

Statements Of Changes In Equity
Group
Foreign Attributable
Exchange Reverse To Owners Non-
Share Share Fair Value Translation Acquisition Revaluation Retained Of The Controlling
Note Capital Premium Reserve Reserve Reserve Reserve Profits Company Interests Total Equity
RM RM RM RM RM RM RM RM RM RM
At 1 April 2012 40,000,000 8,010,827 3,016 (33,020) (26,078,000) 4,031,856 88,067,906 114,002,585 174,444 114,177,029
Profit after tax for the
financial period - - - - - - 773,244 773,244 (195,999) 577,245
Other comprehensive
income for the financial
period
- Fair value changes of
available-for-sale
financial assets - - (650) - - - - (650) - (650)
- Foreign currency
translation differences - - - (67,537) - - - (67,537) - (67,537)
Total comprehensive
income/(expenses) for
the financial period - - (650) (67,537) - - 773,244 705,057 (195,999) 509,058

Contributions by and
distributions to owners
of the Company :
- Dividends
by the Company 27 - - - - - - (3,500,000) (3,500,000) - (3,500,000)
At 31 December 2012 /
1 January 2013 40,000,000 8,010,827 2,366 (100,557) (26,078,000) 4,031,856 85,341,150 111,207,642 (21,555) 111,186,087
Profit after tax for the
financial year - - - - - - 23,424,028 23,424,028 (48,715) 23,375,313

Other comprehensive
income for the financial
year
- Fair value changes of
available-for-sale
financial assets - - 1,160 - - - - 1,160 - 1,160
- Foreign currency
translation differences - - - (19,305) - - - (19,305) - (19,305)
Total comprehensive
income/(expenses) for
the financial year - - 1,160 (19,305) - - 23,424,028 23,405,883 (48,715) 23,357,168

Contributions by and
distributions to owners
of the Company :
- Dividends
by the Company 27 - - - - - - (2,000,000) (2,000,000) - (2,000,000)
At 31 December 2013 40,000,000 8,010,827 3,526 (119,862) (26,078,000) 4,031,856 106,765,178 132,613,525 (70,270) 132,543,255
Distributable __ _ Non-Distributable __ _
Company
Share Share Retained
Note Capital Premium Profits Total Equity
RM RM RM RM
At 1 April 2012 40,000,000 8,010,827 15,794,429 63,805,256
Profit after tax/Total comprehensive income for the financial period - - 2,525,609 2,525,609
Contributions by and distributions to owners of the Company :
- Dividends 27 - - (3,500,000) (3,500,000)
At 31 December 2012 / 1 January 2013 40,000,000 8,010,827 14,820,038 62,830,865
Profit after tax/Total comprehensive income for the financial year - - 13,370,403 13,370,403
Contributions by and distributions to owners of the Company :
- Dividends 27 - - (2,000,000) (2,000,000)
At 31 December 2013 40,000,000 8,010,827 26,190,441 74,201,268

Distributable Non-Distributable
Teo Seng
Capital Berhad
40
Annual
Report
2013
Statements Of Cash Flows
Teo Seng
Capital Berhad
41
Annual
Report
2013
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
CASH FLOWS FROM OPERATING ACTIVITIES
Profit before tax 29,961,076 1,142,662 13,417,403 2,570,460
Adjustments for :
Allowance for impairment losses on
trade receivables 282,550 247,027 - -
Allowance for slow moving inventories 242,485 15,476 - -
Bad debts written off 94,313 11,204 - -
Depreciation - property, plant and equipment 10,510,050 7,728,047 97,184 58,844
Depreciation - investment property 3,225 5,806 - -
Dividend income (160) (150) (15,388,000) (3,514,000)
Fair value gain on derivatives (16,725) - - -
Gain on disposal of property, plant and equipment (546,188) (133,275) - -
Gain on disposal of investment property (90,695) - - -
Goodwill on consolidation written off - 288,215 - -
Inventories written off 45,254 17,765 - -
Property, plant and equipment written off 141,833 315,713 - -
Reversal of allowance for slow moving inventories (12,434) - - -
Reversal of allowance for impairment losses
on trade receivables (256,931) (421,490) - -
Unrealised (gain)/loss on foreign exchange (195,603) 30,812 - -
Interest expenses 4,088,155 2,755,423 373,607 267,060
Interest income (60,073) (71,669) (39,123) (42,715)
OPERATING PROFIT/(LOSS) BEFORE
WORKING CAPITAL CHANGES 44,190,132 11,931,566 (1,538,929) (660,351)
Changes In Working Capital
Inventories (11,575) (6,805,218) - -
Trade and other receivables (3,947,909) (2,178,307) (634,255) 360,296
Trade and other payables 4,045,518 1,097,769 (10,487,119) 352,570
CASH GENERATED FROM/(ABSORBED INTO)
OPERATIONS 44,276,166 4,045,810 (12,660,303) 52,515
Interest paid (4,088,155) (2,755,423) (373,607) (267,060)
Interest received 60,073 71,669 39,123 42,715
Tax paid (2,847,548) (4,240,328) (7,336) (16,501)
NET CASH FROM/(USED IN) OPERATING ACTIVITIES 37,400,536 (2,878,272) (13,002,123) (188,331)
CARRIED FORWARD 37,400,536 (2,878,272) (13,002,123) (188,331)

Statements Of Cash Flows
Group Company
9 Months 9 Months
2013 2012 2013 2012
Note RM RM RM RM
BROUGHT FORWARD 37,400,536 (2,878,272) (13,002,123) (188,331)
CASH FLOWS FROM INVESTING ACTIVITIES
Dividend received 160 150 15,341,000 4,014,000
Acquisition of subsidiaries, net of cash
and cash equivalents acquired - (282,567) - (376,200)
Proceeds from disposal of investment property 550,000 - - -
Proceeds from disposal of property, plant and equipment 1,418,682 1,343,996 - -
Purchase of property, plant and equipment 5(g) (17,473,817) (9,752,450) (75,263) (139,147)
NET CASH (USED IN)/FROM INVESTING ACTIVITIES (15,504,975) (8,690,871) 15,265,737 3,498,653
CASH FLOWS FROM FINANCING ACTIVITIES
Net decrease in fixed deposits pledged 407,195 301,868 - -
Net movements in bankers' acceptances 6,897,000 14,174,000 - -
Net movements in revolving credit - 5,000,000 - -
Repayment of term loans (853,254) (872,772) - -
Repayment of hire purchase payables (8,412,682) (6,476,590) - -
Dividends paid (2,000,000) (3,500,000) (2,000,000) (3,500,000)
NET CASH (USED IN)/FROM FINANCING ACTIVITIES (3,961,741) 8,626,506 (2,000,000) (3,500,000)
NET INCREASE/(DECREASE) IN CASH AND
CASH EQUIVALENTS 17,933,820 (2,942,637) 263,614 (189,678)
EFFECT OF EXCHANGE DIFFERENCES (43,488) (88,556) - -
CASH AND CASH EQUIVALENTS AT BEGINNING
OF THE FINANCIAL YEAR / PERIOD 16,309,578 19,340,771 176,586 366,264
CASH AND CASH EQUIVALENTS AT END OF THE
FINANCIAL YEAR / PERIOD 28 34,199,910 16,309,578 440,200 176,586
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Capital Berhad
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Notes To The Financial Statements
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Capital Berhad
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GENERAL INFORMATION
The Company is a public company limited by shares and is incorporated under the Companies Act, 1965 in Malaysia.
The domicile of the Company is Malaysia and is listed on the Main Market of the Bursa Malaysia Securities Berhad.
The registered office and principal place of business are as follows :
Registered office : 201-203, Jalan Abdullah
84000 Muar
Johor Darul Takzim
Principal place of business : Lot PTD 25740, Batu 4
Jalan Air Hitam
83700 Yong Peng
Johor Darul Takzim
The financial statements were authorised for issue by the Board of Directors in accordance with a resolution of the
directors dated 28 April 2014.
PRINCIPAL ACTIVITIES
The Company is principally engaged in the business of investment holding and provision of management services. The
principal activities of the subsidiaries are set out in Note 7. There have been no significant changes in the nature of
these principal activities during the financial year.
HOLDING COMPANIES
The Company is a subsidiary of Advantage Valuations Sdn. Bhd.. The directors regard Leong Hup Holdings Sdn. Bhd.
as its intermediate holding company and Emerging Glory Sdn. Bhd. as its ultimate holding company. These holding
companies are incorporated in Malaysia.
ACCOUNTING POLICIES AND STANDARDS
Basis of Preparation
The financial statements of the Group and of the Company are prepared under the historical cost convention
and modified to include other bases of valuation as disclosed in the summary of significant accounting
policies, and in compliance with Financial Reporting Standards (FRSs) and the requirements of the
Companies Act, 1965 in Malaysia. During the current financial year, the Group and the Company have
adopted the new accounting standards and interpretations (including the consequential amendments, if any)
as disclosed in Note 4.3.

The preparation of financial statements in conformity with FRSs requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported amounts of
assets, liabilities, income and expenses. Actual results may differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates
are recognised in the period in which the estimate are revised and in any future periods affected.
There are no significant areas of estimation uncertainty and critical judgements in applying accounting
policies that have significant effect on the amounts recognised in the financial statements other than those
disclosed in Note 4.6.
1.
2.
3.
4.
; 58
(a)
(b)
ACCOUNTING POLICIES AND STANDARDS (contd)

Summary of Significant Accounting Policies
Basis of consolidation
The consolidated financial statements include the financial statements of the Company and its subsidiaries
made up to 31 December 2013.
Subsidiaries are entities (including structured entities) controlled by the Group. The Group controls an entity
when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has
the ability to affect those returns through its power over the entity.
Subsidiaries are consolidated from the date on which control is transferred to the Group up to the effective
date on which control ceases, as appropriate.
Intragroup transactions, balances, income and expenses are eliminated on consolidation. Where necessary,
adjustments are made to the financial statements of subsidiaries to ensure consistency of accounting policies
with those of the Group.
Non-controlling interests are presented within equity in the consolidated statement of financial position,
separately from the equity attributable to owners of the Company. Profit or loss and each component of other
comprehensive income are attributed to the owners of the Company and to the non-controlling interests.
Total comprehensive income is attributed to non-controlling interests even if this results in the non-controlling
interests having a deficit balance.
At the end of each reporting period, the carrying amount of non-controlling interests is the amount of those
interests at initial recognition plus the non-controlling interests share of subsequent changes in equity.
All changes in the parents ownership interest in a subsidiary that do not result in a loss of control are
accounted for as equity transactions. Any difference between the amount by which the non-controlling
interest is adjusted and the fair value of consideration paid or received is recognised directly in equity of the
Group.
Upon the loss of control of a subsidiary, the Group recognises any gain or loss on disposal in profit or loss
which is calculated as the difference between :
the aggregate of the fair value of the consideration received and the fair value of any retained interest in
the former subsidiary ; and
the previous carrying amount of the assets (including goodwill), and liabilities of the former subsidiary
and any non-controlling interests.
Amounts previously recognised in other comprehensive income in relation to the former subsidiary are
accounted for in the same manner as would be required if the relevant assets or liabilities were disposed off
(i.e. reclassified to profit or loss or transferred directly to retained profits). The fair value of any investments
retained in the former subsidiary at the date when control is lost is regarded as the fair value on initial
recognition for subsequent accounting under FRS 139 or, when applicable, the cost on initial recognition of
an investment in an associate or a joint venture.
4.
; 59
+d,
(i)
(ii)
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Summary of Significant Accounting Policies (contd)
Basis of consolidation (contd)
Business combinations from 1 April 2011 onwards
Acquisitions of businesses are accounted for using the acquisition method. Under the acquisition method, the
consideration transferred for acquisition of a subsidiary is the fair value of the assets transferred, liabilities
incurred and the equity interests issued by the Group at the acquisition date. The consideration transferred
includes the fair value of any asset or liability resulting from a contingent consideration arrangement.
Acquisition-related costs, other than the costs to issue debt or equity securities, are recognised in profit or
loss when incurred.
In a business combination achieved in stages, previously held equity interests in the acquiree are remeasured
to fair value at the acquisition date and any corresponding gain or loss is recognised in profit or loss.
Non-controlling interests in the acquiree may be initially measured either at fair value or at the non-controlling
interests proportionate share of the fair value of the acquirees identifiable net assets at the date of
acquisition. The choice of measurement basis is made on a transaction-by-transaction basis.
Business combinations before 1 April 2011
All subsidiaries are consolidated using the purchase method. At the date of acquisition, the fair values of the
subsidiaries net assets are determined and these values are reflected in the consolidated financial
statements. The cost of acquisition is measured at the aggregate of the fair values, at the date of exchange,
of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for
control of the acquiree, plus any costs directly attributable to the business combination.
Non-controlling interests are initially measured at their share of the fair values of the identifiable assets and
liabilities of the acquiree as at the date of acquisition.
Goodwill
Goodwill is measured at cost less accumulated impairment losses, if any. The carrying amount of goodwill is
reviewed for impairment annually. The impairment value of goodwill is recognised immediately in profit or
loss. An impairment loss recognised for goodwill is not reversed in a subsequent period.
Business combinations from 1 April 2011 onwards
Under the acquisition method, any excess of the sum of the fair value of the consideration transferred in the
business combination, the amount of non-controlling interests recognised and the fair value of the Groups
previously held equity interest in the acquiree (if any), over the net fair value of the acquirees identifiable
assets and liabilities at the date of acquisition is recorded as goodwill.
Where the latter amount exceeds the former, after reassessment, the excess represents a bargain purchase
gain and is recognised as a gain in profit or loss.
4.
; 59
(a)
(b)

Goodwill (contd)
Business combinations before 1 April 2011
Under the purchase method, goodwill represents the excess of the fair value of the purchase consideration
over the Groups share of the fair values of the identifiable assets, liabilities and contingent liabilities of the
subsidiaries at the date of acquisition.
If, after reassessment, the Groups interest in the fair values of the identifiable net assets of the subsidiaries
exceeds the cost of the business combinations, the excess is recognised as income immediately in profit or
loss.
Investment in subsidiaries
Investments in subsidiaries are stated at cost in the statement of financial position of the Company, and are
reviewed for impairment at the end of the reporting period if events or changes in circumstances indicate that
the carrying values may not be recoverable. The cost of the investments includes transaction costs.
On the disposal of the investments in subsidiaries, the difference between the net disposal proceeds and the
carrying amount of the investments is recognised in profit or loss.
Property, plant and equipment and depreciation
Items of property, plant and equipment are stated at cost or valuation less any accumulated depreciation and
any accumulated impairment losses.
Cost includes expenditures that are directly attributable to the acquisition of the asset and any other costs
directly attributable to bringing the asset to working condition for its intended use, and the costs of
dismantling and removing the items and restoring the site on which they are located. The cost of
self-constructed assets also includes the cost of materials and direct labour. Purchased software that is
integral to the functionality of the related equipment is capitalised as part of that equipment.
The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of
the item, if it is probable that the future economic benefits embodied within the part will flow to the Group and
its cost can be measured reliably. The carrying amount of the replaced part is derecognised. The costs of the
day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred.
When significant parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items (major components) of property, plant and equipment.
Freehold land, farm and poultry buildings are stated at cost or revalued amounts, being the fair value at the
date of revaluation, less any subsequent accumulated depreciation and subsequent accumulated impairment
losses.
For freehold land and factory buildings, revaluations are performed with sufficient regularity such that the
carrying amount does not differ materially from that which would be determined using fair values at the
reporting date.
4.
; 59
+e,
+f ,
+g,
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Property, plant and equipment and depreciation (contd)
Surpluses arising on revaluation are recognised in other comprehensive income and accumulated in equity
under the revaluation reserve. Any deficit arising from revaluation is charged against the revaluation reserve to
the extent of a previous surplus held in the revaluation reserve for the same property, plant and equipment. In
all other cases, a decrease in carrying amount is charged to profit or loss. Subsequent to revaluation, any
addition is stated at cost whilst disposal is stated at cost or valuation as appropriate.
Freehold land is not depreciated whilst capital work-in-progress are not depreciated until they are completed
and put into use. Leased assets are depreciated over the shorter of the lease term and their useful lives
unless it is reasonably certain that the Group will obtain ownership by the end of the lease term. Other
property, plant and equipment are depreciated on a straight-line basis to write off the cost of each asset to its
residual value over the estimated useful lives. Depreciation of an asset does not cease when the asset
becomes idle or is retired from active use unless the asset is fully depreciated. The principal annual rates of
depreciation used are as follows :
Leasehold land Over the lease period
(93 years)
Farm and poultry buildings 2% - 20%
Factory buildings 1% - 2%
Plant and machinery 5% - 20%
Fish pond and equipment 5% - 10%
Egg layer conveyor and cages system 5%
Motor vehicles, electrical installation, furniture, fittings, equipment, renovation and hostel 2% - 33.3%
The residual values, useful lives and depreciation method are reviewed at the end of each reporting period 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 benefits embodied in the items of property, plant
and equipment.
The carrying amounts of property, plant and equipment are reviewed for impairment when events or changes
circumstances indicate that the carrying amounts may not be recoverable. The policy for the recognition and
measurement of impairment losses is in accordance with Note 4.2(g)(ii).
An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits
are expected from its use. The difference between the net disposal proceeds, if any, and the carrying amount
is recognised in profit or loss and the unutilised portion of the revaluation surplus on that item, if any, is
transferred directly to retained profits.
Assets under hire purchase
Assets acquired under hire purchase are capitalised in the financial statements at the lower of the fair value of
the leased assets and the present value of the minimum lease payments and, are depreciated in accordance
with the policy set out in Note 4.2(d) above. Each hire purchase payment is allocated between the liability and
finance charges so as to achieve a constant rate on the finance balance outstanding. Finance charges are
recognised in profit or loss over the period of the respective hire purchase agreements.
Investment property
Investment property is property held either to earn rental income or for capital appreciation or for both.
Initially, investment property is measured at cost including transaction costs, less accumulated depreciation
and impairment losses, if any.

4.
; 59
+g,
+h,
+i ,

Investment property (contd)
The annual depreciation rates for building is 1.62% calculated on the straight line basis based on the
remaining lease period.
Investment property is derecognised when they have either disposed of or when the investment property is
permanently withdrawn from use and no future economic benefit is expected from its disposal.
On the derecognition of an investment property, the difference between the net disposal proceeds and the
carrying amount is recognised in profit or loss.
Transfer are made to or from investment property only when there is a change in use. All transfers do not
change the carrying amount of the property reclassified.
Impairment
Impairment of financial assets
All financial assets (other than those categorised at fair value through profit or loss), are assessed at the end of
each reporting period whether there is any objective evidence of impairment as a result of one or more events
having an impact on the estimated future cash flows of the asset. For an equity instrument, a significant or
prolonged decline in the fair value below its cost is considered to be objective evidence of impairment.
An impairment loss in respect of held-to-maturity investments and loans and receivables financial assets is
recognised in profit or loss and is measured as the difference between the assets carrying amount and the
present value of estimated future cash flows, discounted at the financial assets original effective interest rate.
An impairment loss in respect of available-for-sale financial assets is recognised in profit or loss and is
measured as the difference between its cost (net of any principal payment and amortisation) and its
current fair value, less any impairment loss previously recognised in the fair value reserve. In addition, the
cumulative loss recognised in other comprehensive income and accumulated in equity under fair value
reserve, is reclassified from equity to profit or loss.
With the exception of available-for-sale equity instruments, if, in a subsequent period, the amount of the
impairment loss decreases and the decrease can be related objectively to an event occurring after the
impairment was recognised, the previously recognised impairment loss is reversed through profit or loss
to the extent that the carrying amount of the financial asset at the date the impairment is reversed does
not exceed what the amortised cost would have been had the impairment not been recognised. In
respect of available-for-sale equity instruments, impairment losses previously recognised in profit or loss
are not reversed through profit or loss. Any increase in fair value subsequent to an impairment loss made
is recognised in other comprehensive income.
For available-for-sale debt investments, impairment losses are subsequently reversed in profit or loss if
an increase in the fair value of the investment can be objectively related to an event occurring after the
recognition of the impairment loss in profit or loss.
Impairment of non-financial assets
The carrying amounts of assets, other than those to which FRS 136 Impairment of Assets does not
apply, are reviewed at the end of each reporting period for impairment when there is an indication that the
assets might be impaired. Impairment is measured by comparing the carrying amounts of the assets with
their recoverable amounts. The recoverable amount of the assets is the higher of the assets fair value
less costs to sell and their value-in-use, which is measured by reference to discounted future cash flow.
4.
; 59
(f)
(g)
(i)
(ii)
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Impairment (contd)
Impairment of non-financial assets (contd)
An impairment loss is recognised in profit or loss immediately unless the asset is carried at its revalued
amount. Any impairment loss of a revalued asset is treated as a revaluation decrease to the extent of a
previously recognised revaluation surplus for the same asset.
In respect of assets other than goodwill, and when there is a change in the estimates used to determine
the recoverable amount, a subsequent increase in the recoverable amount of an asset is treated as a
reversal of the previous impairment loss and is recognised to the extent of the carrying amount of the
asset that would have been determined (net of amortisation and depreciation) had no impairment loss
been recognised. The reversal is recognised in profit or loss immediately, unless the asset is carried at its
revalued amount in which case the reversal of the impairment loss is treated as a revaluation increase.
Inventories
Inventories are stated at the lower of cost and net realisable value. Cost is determined on the weighted
average or first-in-first-out bases, as applicable.
Layer, pullet and fishes inventories are stated at cost (determined on weighted average method) adjusted
for amortisation (calculated based on their economic lives less net realisable value). Costs of layer, pullet and
fishes inventories comprise the original purchase price plus growing cost, which include costs of raw
materials, direct labour and a proportion of farm overheads.
Costs of eggs include costs of raw materials, direct labour and an appropriate proportion of farm overheads.
Costs of egg trays and work-in-progress comprise the costs of raw materials, direct labour and a proportion
of factory overheads.
Costs of poultry feeds, trading merchandise, raw materials (determined on first-in-first-out method),
consumable supplies and medication (determined on weighted average method), comprise the original
purchase price plus the costs incurred in bringing the inventories to their present location and condition.
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.
Financial instruments
Financial instruments are recognised in the statements of financial position when the Group has become a
party to the contractual provisions of the instruments.
Financial instruments are classified as liabilities or equity in accordance with the substance of the contractual
arrangement. Interest, dividends, gains and losses relating to a financial instrument classified as a liability, are
reported as an expense or income. Distributions to holders of financial instruments classified as equity are
charged directly to equity.
Financial instruments are offset when the Group has a legally enforceable right to offset and intends to settle
either on a net basis or to realise the asset and settle the liability simultaneously.
A financial instrument is recognised initially at its fair value. Transaction costs that are directly attributable to
the acquisition or issue of the financial instrument (other than a financial instrument at fair value through profit
or loss) are added to/deducted from the fair value on initial recognition, as appropriate. Transaction costs on
the financial instrument at fair value through profit or loss are recognised immediately in profit or loss.
4.
; 59
(g)
(h)
(i)
(ii)

Financial instruments (contd)
Financial instruments recognised in the statements of financial position are disclosed in the individual policy
statement associated with each item.
Financial assets
On initial recognition, financial assets are classified as either financial assets at fair value through profit or
loss, held-to-maturity investments, loans and receivables financial assets, or available-for-sale financial
assets, as appropriate.
Financial assets at fair value through profit or loss
Financial assets are classified as financial assets at fair value through profit or loss when the financial
asset is either held for trading or is designated to eliminate or significantly reduce a measurement or
recognition inconsistency that would otherwise arise. Derivatives are also classified as held for
trading unless they are designated as hedges.

Financial assets at fair value through profit or loss are stated at fair value, with any gains or losses
arising on remeasurement recognised in profit or loss. Dividend income from this category of
financial assets is recognised in profit or loss when the Groups right to receive payment is
established.
Held-to-maturity investments
Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments
and fixed maturities that the management has the positive intention and ability to hold to maturity.
Held-to-maturity investments are measured at amortised cost using the effective interest method
less any impairment loss, with interest income recognised in profit or loss on an effective yield basis.
Loans and receivables financial assets
Trade receivables and other receivables that have fixed or determinable payments that are not
quoted in an active market are classified as loans and receivables financial assets. Loans and
receivables financial assets are measured at amortised cost using the effective interest method, less
any impairment loss. Interest income is recognised by applying the effective interest rate, except for
short-term receivables when the recognition of interest would be immaterial.
Available-for-sale financial assets
Available-for-sale financial assets are non-derivative financial assets that are designated in this
category or are not classified in any of the other categories.
After initial recognition, available-for-sale financial assets are remeasured to their fair values at the
end of each reporting period. Gains and losses arising from changes in fair value are recognised in
other comprehensive income and accumulated in the fair value reserve, with the exception of
impairment losses. On derecognition, the cumulative gain or loss previously accumulated in the fair
value reserve is reclassified from equity into profit or loss. Interest income calculated for a debt
instrument using the effective interest method is recognised in profit or loss.
4.
; 59
(i)
(i)
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Financial assets (contd)
Available-for-sale financial assets (contd)
Dividends on available-for-sale equity instruments are recognised in profit or loss when the Groups
right to receive payments is established.
Investments in equity instruments whose fair value cannot be reliably measured are measured at
cost less accumulated impairment losses, if any.
Financial liabilities
All financial liabilities are initially measured at fair value plus directly attributable transaction costs and
subsequently measured at amortised cost using the effective interest method other than those
categorised as fair value through profit or loss.
Fair value through profit or loss category comprises financial liabilities that are either held for trading or
are designated to eliminate or significantly reduce a measurement or recognition inconsistency that
would otherwise arise. Derivatives are also classified as held for trading unless they are designated as
hedges.
Equity instruments
Instruments classified as equity are measured at cost and are not remeasured subsequently.
Ordinary shares
Incremental costs directly attributable to the issue of new ordinary shares or options are shown in equity
as a deduction, net of tax, from proceeds.
Dividends on ordinary shares are recognised as liabilities when approved for appropriation.
Derecognition
A financial asset or part of it is derecognised when, and only when, the contractual rights to the cash
flows from the financial asset expire or the financial asset is transferred to another party without retaining
control or substantially all risks and rewards of the asset. On derecognition of a financial asset, the
difference between the carrying amount and the sum of the consideration received (including any new
asset obtained less any new liability assumed) and any cumulative gain or loss that had been recognised
in equity is recognised in profit or loss.
A financial liability or a part of it is derecognised when, and only when, the obligation specified in the
contract is discharged or cancelled or expires. On derecognition of a financial liability, the difference
between the carrying amount of the financial liability extinguished or transferred to another party and the
consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in
profit or loss.
4.
4.2
(h)
(i)
(ii)
(iii)
(iv)


Financial guarantee contracts
A financial guarantee contract is a contract that requires the issuer to make specified payments to
reimburse the holder for a loss it incurs because a specific debtor fails to make payment when due in
accordance with the original or modified terms of a debt instrument.
Financial guarantee contracts are recognised initially as liabilities at fair value, net of transaction costs.
Subsequent to initial recognition, financial guarantee contracts are recognised as income in profit or loss
over the period of the guarantee or, when there is no specific contractual period, recognised in profit or
loss upon discharge of the guarantee. If the debtor fails to make payment relating to a financial guarantee
contract when it is due and the Company, as the issuer, is required to reimburse the holder for the
associated loss, the liability is measured at the higher of the best estimate of the expenditure required to
settle the present obligation at the end of the reporting period and the amount initially recognised less
cumulative amortisation.
Fair value measurements
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants at the measurement date, regardless of whether that price is directly
observable or estimated using a valuation technique. The measurement assumes that the transaction takes
place either in the principal market or in the absence of a principal market, in the most advantageous market.
For non-financial asset, the fair value measurement takes into account a markets participants ability to
generate economic benefits by using the asset in its highest and best use or by selling it to another market
participant that would use the asset in its highest and best use.
For financial reporting purposes, the fair value measurements are analysed into level 1 to level 3 as follows :
Inputs are quoted prices (unadjusted) in active markets for identical assets or liability that the entity
can access at the measurement date ;
Inputs are inputs, other than quoted prices included within level 1, that are observable for the asset
or liability, either directly or indirectly ; and
Inputs are unobservable inputs for the asset or liability.
The transfer of fair value between levels is determined as of the date of the event or change in circumstances
that caused the transfer.
Borrowing costs
Borrowing costs, directly attributable to the acquisition, construction or production of a qualifying asset, are
capitalised as part of the cost of those assets, until such time as the assets are ready for their intended use or
sale. Capitalisation of borrowing costs is suspended during the extended periods in which active
development is interrupted.
All other borrowing costs are recognised in profit or loss as expenses in the period in which they incurred.
Investment income earned on the temporary investment of specific borrowing pending their expenditure on
qualifying assets is deducted from the borrowing costs eligible for capitalisation.
4.
4.2
(i)
(j)
(k)
(v)
Level 1:
Level 2:
Level 3:
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Income taxes
Income tax for the year comprises current and deferred tax.
Current tax is the expected amount of income taxes payable in respect of the taxable profit for the reporting
period and is measured using the tax rates that have been enacted or substantively enacted at the end of the
reporting period.
Deferred tax 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 tax liabilities are recognised for all taxable temporary differences other than those that arise from
goodwill or excess of the acquirers interest in the net fair value of the acquirees identifiable assets, liabilities
and contingent liabilities over the business combination costs or from the initial recognition of an asset or
liability in a transaction which is not a business combination and at the time of the transaction, affects neither
accounting profit nor taxable profit.
Deferred tax assets are recognised for all deductible temporary differences, unused tax losses and unused
tax credits to the extent that it is probable that future taxable profits will be available against which the
deductible temporary differences, unused tax losses and unused tax credits can be utilised. The carrying
amounts of deferred tax assets are reviewed at the end of each reporting period and reduced to the extent
that it is no longer probable that sufficient future taxable profits will be available to allow all or part of the
deferred tax assets to be utilised.
Deferred tax assets and liabilities are 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 the tax rates that have been enacted or substantively
enacted at the end of the reporting period.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax
assets against current tax liabilities and when the deferred income taxes relate to the same taxation authority.
Deferred tax relating to items recognised outside profit or loss is recognised outside profit or loss. Deferred
tax items are recognised in correlation to the underlying transactions either in other comprehensive income or
directly in equity and deferred tax arising from a business combination is included in the resulting goodwill or
excess of the acquirers interest in the net fair value of the acquirees identifiable assets, liabilities and
contingent liabilities over the business combination costs.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand, bank balances, demand deposits, bank overdrafts and
short-term, highly liquid investments that are readily convertible to known amounts of cash and which are
subject to an insignificant risk of changes in value with original maturity periods of three months or less.
4.
4.2
(l)
(m)

Revenue recognition
Revenue is measured at the fair value of the consideration received or receivable and represents amounts
receivable for goods and services provided in the normal course of business, net of returns and trade
discounts after eliminating sales within the Group.
Sale of goods
Revenue is recognised when the following conditions are satisfied :
the Group has transferred to the buyer the significant risks and rewards of ownership of the goods ;
the Group retains neither continuing managerial involvement to the degree usually associated with
ownership nor effective control over the goods sold ;
the amount of revenue can be measured reliably ;
it is probable that the economic benefits associated with the transactions will flow to the entity ; and
the cost incurred or to be incurred in respect of the transaction can be measured reliably.
Management fee income
Management fee income from subsidiaries is recognised on accrual basis upon services rendered.
Dividend income
Dividend income from investments is recognised when the right to receive dividend payment is
established.
Interest income
Interest income is recognised on a time proportion basis using the effective interest method.
Rental income
Rental income is recognised on accrual basis unless collectability is in doubt, in which case the
recognition of such income is suspended. Subsequent to suspension, income is recognised on the
receipt basis until all arrears have been paid.
Employee benefits
Short-term benefits
Wages, salaries, paid annual leave, paid sick leave, bonuses, social security costs and non-monetary
benefits are measured on an undiscounted basis and are recognised in profit or loss in the period in
which the associated services are rendered by employees of the Group.
Defined contribution plans
As required by law, companies in Malaysia make contributions to the state pension scheme, the
Employees Provident Fund (EPF). Some of the Groups foreign subsidiaries make contributions to their
respective countries statutory pension schemes. Such contributions are recognised in profit or loss in
the period to which they relate. Once the contributions have been paid, the Group has no further liability
in respect of the defined contribution plans.
4.
4.2
(n)
(o)
(i)
(ii)
(iii)
(iv)
(v)
(i)
(ii)
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Related parties
A party is related to an entity (referred to as the reporting entity) if :
A person or a close member of that persons family is related to a reporting entity if that person :
has control or joint control over the reporting entity ;
has significant influence over the reporting entity ; or
is a member of the key management personnel of the reporting entity or of a parent of the reporting entity.
An entity is related to a reporting entity if any of the following conditions applies :
The entity and the reporting entity are members of the same group (which means that each parent,
subsidiary and fellow subsidiary is related to the others).
One entity is an associate or joint venture of the other entity (or an associate or joint venture of a
member of a group of which the other entity is a member).
Both entities are joint ventures of the same third party.
One entity is a joint venture of a third entity and the other entity is an associate of the third entity.
The entity is a post-employment benefit plan for the benefit of employees of either the reporting
entity or an entity related to the reporting entity. If the reporting entity is itself such a plan, the
sponsoring employers are also related to the reporting entity.
The entity is controlled or jointly controlled by a person identified in (i) above.
A person identified in (i)(I) above has significant influence over the entity or is a member of the key
management personnel of the entity (or of a parent of the entity).
Close members of the family of a person are those family members who may be expected to influence, or be
influenced by, that person in their dealings with the entity.
Functional and foreign currencies
Functional and presentation currency
The individual financial statements of each entity in the Group are presented in the currency of the
primary economic environment in which the entity operates, which is the functional currency.
The consolidated financial statements are presented in Ringgit Malaysia (RM), which is the Companys
functional and presentation currency.
Transactions and balances
Transactions in foreign currencies are converted into the respective functional currencies on initial
recognition, using the exchange rates approximating those ruling at the transaction dates. Monetary
assets and liabilities at the end of the reporting period are translated at the rates ruling as of that date.
Non-monetary assets and liabilities are translated using exchange rates that existed when the values
were determined. All exchange differences are recognised in profit or loss except for differences arising
from the translation of available-for-sale equity instruments which are recognised in other comprehensive
income.
4.
4.2
(p)
(q)
(i)
(ii)
(i)
(ii)
(I)
(II)
(III)
(I)
(II)
(III)
(IV)
(V)
(VI)
(VII)

Functional and foreign currencies (contd)
Foreign operations
Assets and liabilities of foreign operations are translated to RM at the rates of exchange ruling at the end
of the reporting period. Revenues and expenses of foreign operations are translated at exchange rates
ruling at the dates of the transactions. All exchange differences arising from translation are taken directly
to other comprehensive income and accumulated in equity under the translation reserve. On the disposal
of a foreign operation, the cumulative amount recognised in other comprehensive income relating to that
particular foreign operation is reclassified from equity to profit or loss.
Goodwill and fair value adjustments arising from the acquisition of foreign operations are treated as
assets and liabilities of the foreign operations and are recorded in the functional currency of the foreign
operations and translated at the closing rate at the end of the reporting period.
Operating segments
An operating segment is a component of the Group that engages in business activities from which it may
earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of
the Groups other components. An operating segments operating results are reviewed regularly by the chief
operating decision maker to make decisions about resources to be allocated to the segment and assess its
performance, and for which discrete financial information is available.
During the current financial year, the Group has adopted the following new accounting standards and
interpretations (including the consequential amendments, if any) :
FRSs and IC Interpretations (including the Consequential Amendments)
FRS 10 : Consolidated Financial Statements
FRS 11 : Joint Arrangements
FRS 12 : Disclosure of Interests in Other Entities
FRS 13 : Fair Value Measurement
FRS 119 (2011) : Employee Benefits
FRS 127 (2011) : Separate Financial Statements
FRS 128 (2011) : Investments in Associates and Joint Ventures
Amendments to FRS 7 : Disclosures Offsetting Financial Assets and Financial Liabilities
Amendments to FRS 10, : Transition Guidance
FRS 11 and FRS 12
IC Interpretation 20 : Stripping Costs in the Production Phase of a Surface Mine
Annual Improvements to FRSs (2012)
4.
4.2
4.3
(q)
(r)
(iii)
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Capital Berhad
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Capital Berhad
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(contd)
The adoption of the above accounting standards and interpretations (including the consequential amendments)
did not have any material impact on the Groups financial statements, except as follows :
FRS 10 replaces the consolidation guidance in FRS 127 and IC Interpretation 112. Under FRS 10, there is only
one basis for consolidation, which is control. Extensive guidance has been provided in the standard to assist
in the determination of control. The adoption of the above FRS 10 did not have any financial impact on the
Group and of the Company.
FRS 12 is applicable to entities that have interests in subsidiaries, joint arrangements, associates and/or
unconsolidated structured entities. The adoption of this standard affects disclosures in the financial
statements only and has no financial impact on the Groups financial statements.
FRS 13 defines fair value, provides guidance on how to determine fair value and requires disclosures about
fair value measurements. The scope of FRS 13 is broad ; it applies to both financial instrument items and
non-financial instrument items for which other FRSs require or permit fair value measurements and
disclosures about fair value measurements, except in specified circumstances. Application of FRS 13 has not
materiality impacted the fair value measurement of the Group. Additional disclosures where required, are
provided in the individual notes relating to the assets and liabilities whose fair values were determined.
The amendments to FRS 7 (Disclosures Offsetting Financial Assets and Financial Liabilities) require
disclosures that will enable users of an entitys financial statements to evaluate the effect or potential effect of
netting arrangements, including rights of set-off associated with the entitys recognised financial assets and
recognised financial liabilities, on the entitys financial position.
The Annual Improvements to FRSs (2012) contain amendments to FRS 1, FRS 101, FRS 116, FRS 132 and FRS 134.
The Group has not applied in advance the following accounting standards and interpretations (including the
consequential amendments, if any) that have been issued by the Malaysian Accounting Standards Board
(MASB) but are not yet effective for the current financial year :
FRSs and IC Interpretations Effective date
(including the Consequential Amendments)
FRS 9 (2009) : Financial Instruments
FRS 9 (2010) : Financial Instruments To be
FRS 9 : Financial Instruments (Hedge Accounting and announced
Amendments to FRS 7, FRS 9 and FRS 139) by MASB
Amendments to FRS 9 : Mandatory Effective Date of FRS 9 and
and FRS 7 Transition Disclosures
Amendments to FRS 10, : Investment Entities 1 January 2014
FRS 12 and FRS 127 (2011)
Amendments to FRS 119 : Defined Benefit Plans Employee Contributions 1 July 2014
Amendments to FRS 132 : Offsetting Financial Assets and Financial Liabilities 1 January 2014
Amendments to FRS 136 : Recoverable Amount Disclosures for Non-Financial Assets 1 January 2014
Amendments to FRS 139 : Novation of Derivatives and Continuation of Hedge 1 January 2014
Accounting
4.
4.3
4.4
(a)
(b)
(c)
(d)
(e)
}
(contd)
FRSs and IC Interpretations Effective date
(including the Consequential Amendments)
IC Interpretation 21 : Levies 1 January 2014
Annual Improvements to FRSs 2010 2012 Cycle 1 July 2014
Annual Improvements to FRSs 2011 2013 Cycle 1 July 2014
The above accounting standards and interpretations (including the consequential amendments) are not relevant to
the Groups operations except as follows :
FRS 9 (2009) introduces new requirements for the classification and measurement of financial assets.
Subsequently, this FRS 9 was amended in year 2010 to include requirements for the classification and
measurement of financial liabilities and for derecognition (known as FRS 9 (2010)). Generally, FRS 9 replaces
the parts of FRS 139 that relate to the classification and measurement of financial instruments. FRS 9 divides
all financial assets into 2 categories those measured at amortised cost and those measured at fair value,
based on the entitys business model for managing its financial assets and the contractual cash flow
characteristics of the instruments. For financial liabilities, the standard retains most of the FRS 139
requirement. An entity choosing to measure a financial liability at fair value will present the portion of the
change in its fair value due to changes in the entitys own credit risk in other comprehensive income rather
than within profit or loss. The effective date of this standard has been deferred from 1 January 2013 to 1
January 2015. The Group is in the process of making assessment of the impact of the adoption of FRS 9.
The amendments to FRS 132 provide the application guidance for criteria to offset financial assets and
financial liabilities. Accordingly, there will be no financial impact on the financial statements of the Group upon
its initial application but may impact its future disclosures.
The amendments to FRS 136 remove the requirement to disclosure the recoverable amount when a
cash-generating unit contains goodwill or intangible assets with indefinite useful lives but there has been no
impairment. Therefore, there will be no financial impact on the financial statements of the Group upon its
initial application but may impact its future disclosures.
On 19 November 2011, MASB issued a new MASB approved accounting framework, the Malaysian Financial
Reporting Standards (MFRSs) that are equivalent to International Financial Reporting Standards (IFRS).
The MFRSs are to be applied by all Entities Other Than Private Entities for annual periods beginning on or after 1
January 2012, with the exception of entities that are within the scope of MFRS 141 (Agriculture) and IC
Interpretation 15 (Agreements for Construction of Real Estate), including its parent, significant investor and
venturer (herein called Transitioning Entities). The Group falls within the definition of Transitioning Entities and
has elected to present its first MFRSs financial statements when the MFRS framework become mandatory.
Currently, the MASB has not announced as to when the Transitioning Entities are mandated to comply with the
MFRS Framework. This is because of the revision in the project timeline on the issuance of new IFRS on Revenue
and the proposed limited amendments to IAS 41 (Agriculture) by the International Accounting Standard Board.
According, the Group is unable to assess the potential financial effects of the differences between the accounting
standards under FRSs and the MFRSs.
4.
(a)
(b)
(c)
4.4
4.5
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Critical Accounting Estimates and Judgements
Estimates and judgements are continually evaluated by the directors and management and are based on historical
experience and other factors, including expectations of future events that are believed to be reasonable under the
circumstances. The estimates and judgements that affect the application of the Groups accounting policies and
disclosures, and have a significant risk of causing a material adjustment to the carrying amounts of assets,
liabilities, income and expenses are discussed below :
Depreciation of property, plant and equipment
The estimates for the residual values, useful lives and related depreciation charges for the property, plant and
equipment are based on commercial factors which could change significantly as a result of technical
innovations and competitors actions in response to the market conditions. The Group anticipates that the
residual values of its property, plant and equipment will be insignificant. As a result, residual values are not
being taken into consideration for the computation of the depreciable amount. Changes in the expected level
of usage and technological development could impact the economic useful lives and the residual values of
these assets, therefore future depreciation charges could be revised.
Income taxes
There are certain transactions and computations for which the ultimate tax determination may be different
from the initial estimate. The Group recognises tax liabilities based on its understanding of the prevailing tax
laws and estimates of whether such taxes will be due in the ordinary course of business. Where the final
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 year in which such determination is made.
Impairment of non-financial assets
When the recoverable amount of an asset is determined based on the estimate of the value-in-use of the
cash-generating unit to which the asset is allocated, the management is required to make an estimate of the
expected future cash flows from the cash-generating unit and also to apply a suitable discount rate in order to
determine the present value of those cash flows.
Write-down of inventories Non-livestocks
Reviews are made periodically by management on damaged, obsolete and slow moving inventories. These
reviews require judgement and estimates. Possible changes in these estimates could result in revisions to the
valuation of inventories.
Impairment of trade and other receivables
An impairment loss is recognised when there is objective evidence that a financial asset is impaired.
Management specifically reviews its loans and receivables financial assets and analyses historical bad debts,
customer concentrations, customer creditworthiness, current economic trends and changes in the customer
payment terms when making a judgement to evaluate the adequacy of the allowance for impairment losses.
Where there is objective evidence of impairment, the amount and timing of future cash flows are estimated
based on historical loss experience for assets with similar credit risk characteristics. If the expectation is
different from the estimation, such difference will impact the carrying amount of receivables.

4.
4.6
(a)
(b)
(c)
(d)
(e)

Critical Accounting Estimates and Judgements (contd)
Revaluation of properties
Certain properties of the Group are reported at valuation which is based on valuations performed by
independent professional valuers.
The independent professional valuers have exercised judgement in determining discount rates, estimates of
future cash flows, capitalisation rate, terminal year value, market freehold rental and other factors used in the
valuation process. Also, judgement has been applied in estimating prices for less readily observable external
parameters. Other factors such as model assumptions, market dislocations and unexpected correlations can
also materially affect these estimates and the resulting valuation estimates.
Impairment of available-for-sale financial assets
The Group reviews its available-for-sale financial assets at the end of each reporting period to assess whether
they are impaired. The Group also records impairment loss on available-for-sale equity investments when
there has been a significant or prolonged decline in the fair value below their cost. The determination of what
is significant or prolonged requires judgement. In making this judgement, the Group evaluates, among
other factors, historical share price movements and the duration and extent to which the fair value of an
investment is less than its cost.
Fair value estimates for certain financial assets and liabilities
The Group carries certain financial assets and liabilities at fair value, which requires extensive use of
accounting estimates and judgement. While significant components of fair value measurement were
determined using verifiable objective evidence, the amount of changes in fair value would differ if the Group
uses different valuation methodologies. Any changes in fair value of these assets and liabilities would affect
profit and/or equity.
4.
4.6
(f)
(g)
(h)
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Capital Berhad
60
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Capital Berhad
61
Annual
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2013
5. PROPERTY, PLANT AND EQUIPMENT
Group - 2013
* Freehold
land, farm
and poultry
buildings
*Leasehold
land,
freehold
land and
factory
buildings
Plant and
machinery
Fish pond
and
equipment
Egg layer
conveyor
and cages
system
Motor
vehicles,
electrical
installation,
furniture,
fittings,
equipment,
renovation
and hostel
Capital work-
in-progress Total

RM RM RM RM RM RM RM RM

At cost / valuation
At 1 January 2013 75,665,297 14,577,107 43,357,056 655,018 36,038,043 30,823,962 3,133,516 204,249,999
Additions 5,536,509 3,877,399 808,328 124,465 2,857,397 2,642,916 6,545,478 22,392,492
Disposals (869,795) - - - - (570,881) - (1,440,676)
Write off - - - - (343,641) (220,231) - (563,872)
Reclassification 4,389,618 732,055 1,363,031 110,505 - 543,894 (7,139,103) -
Foreign exchange difference - - - - - 46,540 - 46,540
At 31 December 2013 84,721,629 19,186,561 45,528,415 889,988 38,551,799 33,266,200 2,539,891 224,684,483
Representing :
At valuation - 10,512,166 - - - - - 10,512,166
At cost 84,721,629 8,674,395 45,528,415 889,988 38,551,799 33,266,200 2,539,891 214,172,317
84,721,629 19,186,561 45,528,415 889,988 38,551,799 33,266,200 2,539,891 224,684,483
Less : Accumulated depreciation
At 1 January 2013 21,564,046 608,725 21,348,815 35,059 10,882,313 17,804,551 - 72,243,509
Charge for the financial year 2,358,936 181,818 2,667,643 64,461 1,833,659 3,403,533 - 10,510,050
Disposals - - - - - (568,182) - (568,182)
Write off - - - - (335,050) (86,989) - (422,039)
At 31 December 2013 23,922,982 790,543 24,016,458 99,520 12,380,922 20,575,270 - 81,785,695
Representing :
At valuation - 499,090 - - - - - 499,090
At cost 23,922,982 291,453 24,016,458 99,520 12,380,922 20,575,270 - 81,286,605
23,922,982 790,543 24,016,458 99,520 12,380,922 20,575,270 - 81,785,695
Carrying amount
At 31 December 2013 60,798,647 18,396,018 21,511,957 790,468 26,170,877 12,690,930 2,539,891 142,898,788
Representing :
At valuation - 10,013,076 - - - - - 10,013,076
At cost 60,798,647 8,382,942 21,511,957 790,468 26,170,877 12,690,930 2,539,891 132,885,712
60,798,647 18,396,018 21,511,957 790,468 26,170,877 12,690,930 2,539,891 142,898,788
PROPERTY, PLANT AND EQUIPMENT (contd)
* The freehold land, leasehold land, farm and poultry buildings and factory buildings of the Group consists of :
Freehold land, farm and poultry buildings Leasehold land, freehold land and factory buildings
Farm and
Freehold poultry Freehold Leasehold Factory
land buildings Total land land buildings Total
RM RM RM RM RM RM RM
At cost / valuation
At 1 January 2013 20,157,220 55,508,077 75,665,297 4,548,130 1,878,243 8,150,734 14,577,107
Additions 4,731,299 805,210 5,536,509 3,877,399 - - 3,877,399
Disposals (869,795) - (869,795) - - - -
Reclassification 1,376,858 3,012,760 4,389,618 - - 732,055 732,055
At 31 December 2013 25,395,582 59,326,047 84,721,629 8,425,529 1,878,243 8,882,789 19,186,561
Representing :
At valuation - - - 4,343,530 - 6,168,636 10,512,166
At cost 25,395,582 59,326,047 84,721,629 4,081,999 1,878,243 2,714,153 8,674,395
25,395,582 59,326,047 84,721,629 8,425,529 1,878,243 8,882,789 19,186,561
Less : Accumulated
depreciation
At 1 January 2013 - 21,564,046 21,564,046 - 82,034 526,691 608,725
Charge for the financial
year - 2,358,936 2,358,936 - 20,509 161,309 181,818
At 31 December 2013 - 23,922,982 23,922,982 - 102,543 688,000 790,543

Representing :
At valuation - - - - - 499,090 499,090
At cost - 23,922,982 23,922,982 - 102,543 188,910 291,453
- 23,922,982 23,922,982 - 102,543 688,000 790,543
Carrying amount
At 31 December 2013 25,395,582 35,403,065 60,798,647 8,425,529 1,775,700 8,194,789 18,396,018
Representing :
At valuation - - - 4,343,530 - 5,669,546 10,013,076
At cost 25,395,582 35,403,065 60,798,647 4,081,999 1,775,700 2,525,243 8,382,942
25,395,582 35,403,065 60,798,647 8,425,529 1,775,700 8,194,789 18,396,018

5.
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Capital Berhad
62
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Report
2013
Teo Seng
Capital Berhad
63
Annual
Report
2013
5. PROPERTY, PLANT AND EQUIPMENT (contd)
Group - 2012
* Freehold
land, farm
and poultry
buildings
* Leasehold
land,
freehold
land and
factory
buildings
Fish pond
and
equipment
Plant and
machinery
Egg layer
conveyor
and cages
system
Motor
vehicles,
electrical
installation,
furniture,
fittings,
equipment,
renovation
and hostel
Capital work-
in-progress Total
RM RM RM RM RM RM RM RM

At cost / valuation
At 1 April 2012 71,702,766 14,577,107 41,195,442 425,611 33,076,082 28,676,587 1,595,261 191,248,856
Additions 3,814,459 - 1,244,576 407 2,835,264 2,449,704 5,106,568 15,450,978
Disposals (1,043,627) - (4,500) - - (361,728) - (1,409,855)
Write off - - - - (1,648,994) (31,237) - (1,680,231)
Acquisition of subsidiary 604,400 - - - - - - 604,400
Reclassification 587,299 - 921,538 229,000 1,775,691 54,785 (3,568,313) -
At 31 December 2012 75,665,297 14,577,107 43,357,056 655,018 36,038,043 30,823,962 3,133,516 204,249,999
Representing :
At valuation - 10,512,166 - - - - - 10,512,166
At cost 75,665,297 4,064,941 43,357,056 655,018 36,038,043 30,823,962 3,133,516 193,737,833
75,665,297 14,577,107 43,357,056 655,018 36,038,043 30,823,962 3,133,516 204,249,999
At 1 April 2012 19,788,008 478,438 19,412,069 - 10,924,383 15,464,913 - 66,067,811
Charge for the financial period 1,776,038 130,287 1,940,084 35,059 1,311,156 2,535,423 - 7,728,047
Disposals - - (3,338) - - (195,796) - (199,134)
Write off - - - - (1,353,226) (11,292) - (1,364,518)
At 31 December 2012 21,564,046 608,725 21,348,815 35,059 10,882,313 17,804,551 - 72,243,509
Representing :
At valuation - 405,042 - - - - - 405,042
At cost 21,564,046 203,683 21,348,815 35,059 10,882,313 17,804,551 - 71,838,467
21,564,046 608,725 21,348,815 35,059 10,882,313 17,804,551 - 72,243,509
Carrying amount
At 31 December 2012 54,101,251 13,968,382 22,008,241 619,959 25,155,730 13,019,411 3,133,516 132,006,490
Representing :
At valuation - 10,107,124 - - - - - 10,107,124
At cost 54,101,251 3,861,258 22,008,241 619,959 25,155,730 13,019,411 3,133,516 121,899,366
54,101,251 13,968,382 22,008,241 619,959 25,155,730 13,019,411 3,133,516 132,006,490
* The freehold land, leasehold land, farm and poultry buildings and factory buildings of the Group consists of :
Freehold land, farm and poultry buildings Leasehold land, freehold land and factory buildings
Farm and
Freehold poultry Freehold Leasehold Factory
land buildings Total land land buildings Total
RM RM RM RM RM RM RM
At cost / valuation
At 1 April 2012 17,642,539 54,060,227 71,702,766 4,548,130 1,878,243 8,150,734 14,577,107
Additions 2,953,908 860,551 3,814,459 - - - -
Disposals (1,043,627) - (1,043,627) - - - -
Acquisition of subsidiary 604,400 - 604,400 - - - -
Reclassification - 587,299 587,299 - - - -
At 31 December 2012 20,157,220 55,508,077 75,665,297 4,548,130 1,878,243 8,150,734 14,577,107
Representing :
At valuation - - - 4,343,530 - 6,168,636 10,512,166
At cost 20,157,220 55,508,077 75,665,297 204,600 1,878,243 1,982,098 4,064,941
20,157,220 55,508,077 75,665,297 4,548,130 1,878,243 8,150,734 14,577,107
Less : Accumulated
depreciation
At 1 April 2012 - 19,788,008 19,788,008 - 66,653 411,785 478,438
Charge for the financial
period - 1,776,038 1,776,038 - 15,381 114,906 130,287
At 31 December 2012 - 21,564,046 21,564,046 - 82,034 526,691 608,725
Representing :
At valuation - - - - - 405,042 405,042
At cost - 21,564,046 21,564,046 - 82,034 121,649 203,683
- 21,564,046 21,564,046 - 82,034 526,691 608,725
Carrying amount
At 31 December 2012 20,157,220 33,944,031 54,101,251 4,548,130 1,796,209 7,624,043 13,968,382
Representing :
At valuation - - - 4,343,530 - 5,763,594 10,107,124
At cost 20,157,220 33,944,031 54,101,251 204,600 1,796,209 1,860,449 3,861,258
20,157,220 33,944,031 54,101,251 4,548,130 1,796,209 7,624,043 13,968,382
Teo Seng
Capital Berhad
64
Annual
Report
2013
Teo Seng
Capital Berhad
65
Annual
Report
2013
Company - 2013
Capital
Office work-in
equipment -progress Total
RM RM RM
At cost
At 1 January 2013 906,956 90,770 997,726
Additions 31,484 11,535 43,019
Reclassification 102,305 (102,305) -
At 31 December 2013 1,040,745 - 1,040,745
At 1 January 2013 139,645 - 139,645
Charge for the financial year 97,184 - 97,184
At 31 December 2013 236,829 - 236,829
Carrying amount
At 31 December 2013 803,916 - 803,916
Company 2012
Capital
Office work-in
equipment -progress Total
RM RM RM
At cost
At 1 April 2012 819,833 - 819,833
Additions 87,123 90,770 177,893
At 31 December 2012 906,956 90,770 997,726
At 1 April 2012 80,801 - 80,801
Charge for the financial period 58,844 - 58,844
At 31 December 2012 139,645 - 139,645
Carrying amount
At 31 December 2012 767,311 90,770 858,081
The freehold land and factory buildings of certain subsidiaries were last revalued by the directors on 31 March
2009 based on a valuation carried out by an independent firm of professional valuers. The valuation was based on
market value using comparison and cost methods of valuation.
(a)
If the Groups revalued property, plant and equipment were measured using the cost model, the carrying amount
would be as follows :
Group
2013 2012
RM RM
Carrying Amount
Freehold land 1,326,102 1,483,205
Factory buildings 4,253,682 4,275,307
5,579,784 5,758,512
Certain property, plant and equipment of certain subsidiaries with carrying amount of RM 5,301,591 (2012 : RM
5,428,885) have been pledged to licensed banks as security for banking facilities granted to the Group (Note 16(a)).
The following property, plant and equipment were acquired under hire purchase instalment plans (Note 17) :
Group
2013 2012
RM RM
Carrying Amount
Plant and machinery 7,817,675 7,992,119
Egg layer conveyor and cages system 11,839,581 13,894,416
Motor vehicles 4,375,674 4,806,563
Capital work-in-progress - 612,990
24,032,930 27,306,088
These leased assets have been pledged as security for the related finance lease liabilities of the Group.
Motor vehicles with carrying amount of RM 13,125 (2012 : RM 21,401) are held in trust and registered under third
partys name.
At the end of the reporting period, the title of freehold land of RM 1,876,430 (2012 : RM NIL) is yet to be registered
in the name of the subsidiary.
Purchase of property, plant and equipment are as follows:
Group Company
2013 2012 2013 2012
RM RM RM RM
Aggregate cost of property, plant
and equipment acquired 22,392,492 15,450,978 43,019 177,893
Finance via hire purchase (3,371,000) (6,212,990) - -
Unpaid balance included under
sundry payables (Note 18(d)) (2,756,277) (1,211,602) (6,502) (38,746)
Cash paid in respect of acquisition
in previous financial period/year 1,208,602 1,726,064 38,746 -
Cash paid during the financial
year/period 17,473,817 9,752,450 75,263 139,147
(b)
(c)
(d)
(e)
(f)
(g)
Teo Seng
Capital Berhad
66
Annual
Report
2013
Teo Seng
Capital Berhad
67
Annual
Report
2013
INVESTMENT PROPERTY
Group
2013 2012
RM RM
At Cost
At 1 January / 1 April 480,000 480,000
Disposal (480,000) -
At 31 December - 480,000
At 1 January / 1 April 17,470 11,664
Charge for the financial year/period 3,225 5,806
Disposal (20,695) -
At 31 December - 17,470
Carrying amount - 462,530
Included in the above is :
Leasehold shophouse - 462,530

INVESTMENT IN SUBSIDIARIES
Company
2013 2012
RM RM

Unquoted shares, at cost
- in Malaysia 67,934,602 67,934,602
- outside Malaysia 240,005 240,005
68,174,607 68,174,607
The details of the subsidiaries are shown as below :
Country of Effective equity
Name of subsidiary incorporation Principal activities interest
2013 2012
Direct subsidiaries :
Teo Seng Farming Malaysia Investment holding and poultry 100% 100%
Sdn. Bhd. farming.

Teo Seng Feedmill Malaysia Manufacturing and marketing 100% 100%
Sdn. Bhd. of animal feeds.

Success Century Malaysia Poultry farming. 100% 100%
Sdn. Bhd.

Ritma Prestasi Malaysia Distribution of pet food, 100% 100%
Sdn. Bhd. medicine and other animal
health related products.
6.
7.
7.
(a)
(b)
(c)
INVESTMENT IN SUBSIDIARIES (contd)
The details of the subsidiaries are shown as below : (contd)
Country of Effective equity
Name of subsidiary incorporation Principal activities interest
2013 2012
Teo Seng Paper Products Malaysia Manufacturing and marketing 100% 100%
Sdn. Bhd. of egg trays.

Liberal Energy Sdn. Bhd. Malaysia General trading and generation of 100% 100%
energy by establishment of bio gas plants.
Pioneer Prosperity Malaysia Dormant. 100% 100%
Sdn. Bhd.
* Premium Egg Products Singapore Wholesaler, importers, exporters 100% 100%
Pte. Ltd. of daily products.
* Audited by other firms of chartered accountants.
Indirect subsidiaries :
Forever Best Supply Malaysia To carry on business in organic 60% 60%
Sdn. Bhd. fertiliser, allied products of fertiliser,
products of fertiliser of chemical
processing and transportation.

Laskar Fertiliser Malaysia Dealing in fertiliser, conduct 100% 100%
Sdn. Bhd. research on the fertilisers and
agricultural business process and
to carry on the business of processing
of value added products and farm produces.
B-Tech Aquaculture Malaysia General trading and aquaculture, 100% 100%
Sdn. Bhd. livestock and poultry activities.
On 12 September 2013, Teo Seng Farming Sdn. Bhd. (TSF), a wholly-owned subsidiary of the Company,
subscribed 100,000 new ordinary shares of RM 1.00 each in Laskar Fertiliser Sdn. Bhd. (Laskar), an indirect
wholly-owned subsidiary of the Company, at par for cash.
On 20 December 2013, TSF subscribed 300,000 new ordinary shares of RM 1.00 each in Laskar at par by way of
off-setting part of the outstanding amount owed by Laskar to TSF.
On 9 July 2013, TSF subscribed 1,000,000 redeemable convertible preference shares of RM 1.00 each in Forever
Best Supply Sdn. Bhd. (Forever), a 60% owned subsidiary of TSF.
The non-controlling interests at the end of the reporting period comprise the following :
Group
2013 2012
RM RM
Forever (70,270) (21,555)
Teo Seng
Capital Berhad
68
Annual
Report
2013
Teo Seng
Capital Berhad
69
Annual
Report
2013
INVESTMENT IN SUBSIDIARIES (contd)
The summarised financial information (before intra-group elimination) for the subsidiary that has non-controlling
interests that are material to the Group is as follows :
Forever
2013 2012
RM RM
At 31 December
Non-current assets 1,949,521 1,700,548
Current assets 1,377,721 1,448,560
Non-current liabilities (931,870) (677,652)
Current liabilities (1,571,047) (2,525,342)
Net assets/(liabilities) 824,325 (53,886)
Financial year/period ended 31 December
Revenue 3,964,731 3,613,879
(Loss) for the financial year/period (121,789) (489,997)
Total comprehensive (expenses) (121,789) (489,997)
Total comprehensive (expenses) attributable to non-controlling interests (48,715) (195,999)

Net cash flows from operating activities (1,020,739) 41,216
Net cash flows from investing activities (87,673) 41,800
Net cash flows from financing activities 1,034,498 (7,650)

OTHER INVESTMENT
Group
2013 2012
RM RM
Quoted shares in Malaysia - at fair value 6,550 5,390
Investment in quoted shares of the Group is designated as available-for-sale financial assets and is measured at fair value.
TRADE AND OTHER RECEIVABLES
Group Company
2013 2012 2013 2012
RM RM RM RM
NON-CURRENT
Long Term Receivable
Amount due from subsidiaries - - 3,950,890 3,662,545
CURRENT
Trade Receivable
Amount due from related companies 2,617,824 2,893,085 - -
Amount due from related parties 537,670 972,703 - -
Other trade receivables 30,588,848 24,173,644 - -
33,744,342 28,039,432 - -
Less : Allowance for impairment losses (499,329) (473,710) - -
33,245,013 27,565,722 - -
7.
8.
9.
(d)

-

2,617,824 2,893,085
537,670 972,703
30,588,848 24,173,644
33,744,342 28,039,432
(499,329) (473,710)
33,245,013 27,565,722

- 3,950,890 3,662,545

-
-
-
-
-
-
TRADE AND OTHER RECEIVABLES (contd)
Group Company
2013 2012 2013 2012
RM RM RM RM
Other Receivables
Amount due from subsidiaries - - 1,145,270 793,808
Amount due from related company - 653 - -
Deposits 504,033 2,395,402 - -
Prepayments 1,395,989 1,237,686 8,517 8,517
Tax recoverable 2,655,753 4,385,403 522,603 515,267
Sundry receivables 298,885 220,877 - 5,552
4,854,660 8,240,021 1,676,390 1,323,144
38,099,673 35,805,743 1,676,390 1,323,144
Allowance for impairment losses :
At 1 January / April (473,710) (648,173) - -
Additions during the financial year/period (282,550) (247,027) - -
Reversal during the financial year/period 256,931 421,490 - -
At 31 December (499,329) (473,710) - -
The Groups normal trade terms range from cash term to 150 days (2012 : cash term to 150 days) from the date of
invoices.

The allowance for impairment losses is made mainly on those trade receivables in significant financial difficulties
and have defaulted on payments.
The non-trade amounts due from subsidiaries and related company are unsecured, interest free and repayable on
demand except for the advances from subsidiaries of RM 1,112,269 (2012 : RM 760,808) which bear interest at
3.3% (2012 : 3.3%) per annum at the end of the reporting period.
DEFERRED TAX ASSETS/(LIABILITIES)
Group
2013 2012
RM RM
At 1 January / April (7,016,104) (9,380,104)
Recognised in profit or loss (Note 25) (1,305,370) 2,310,000
Overprovision in prior years (Note 25) 34,474 54,000
At 31 December (8,287,000) (7,016,104)
Presented after appropriate offsetting as follows :
Deferred tax assets 303,000 -
Deferred tax liabilities (8,590,000) (7,016,104)
(8,287,000) (7,016,104)
9.
10.
(a)
(b)
(c)
Teo Seng
Capital Berhad
70
Annual
Report
2013
Teo Seng
Capital Berhad
71
Annual
Report
2013
10. DEFERRED TAX ASSETS/(LIABILITIES) (contd)
The components and movements of deferred tax liabilities and assets during the financial year prior to offsetting are
as follows :
Deferred tax liabilities
Excess of
capital
Revaluation allowances
surplus of over
properties depreciation Total
RM RM RM
At 1 January (983,000) (9,074,104) (10,057,104)
Recognised in profit or loss 64,000 (68,896) (4,896)
At 31 December (919,000) (9,143,000) (10,062,000)
Deferred tax assets
Unabsorbed Other
Unused capital temporary
tax losses allowances differences Total
RM RM RM RM
At 1 January 1,799,000 1,180,000 62,000 3,041,000
Recognised in profit or loss (1,471,000) 209,000 (4,000) (1,266,000)
At 31 December 328,000 1,389,000 58,000 1,775,000
Subject to the agreement of the respective tax authorities, the Group has the following items at the end of the
reporting period to offset against its future taxable profits.
Group
2013 2012
RM RM
Unused tax losses 434,000 2,216,000
Unabsorbed capital allowances 231,000 1,515,000
665,000 3,731,000
The deductible temporary differences do not expire under current tax legislation. No deferred tax assets are
recognised in respect of these items as it is not probable that future taxable profits of the Group will be available
against which the deductible temporary differences can be utilised.
(a)
(b)
(i)
(ii)
INVENTORIES
Group
2013 2012
RM RM
At Cost
Layers 17,081,576 18,040,836
Pullets 6,269,228 6,085,890
Fishes - 46,271
Raw materials 7,164,556 6,668,081
Trading merchandise 7,359,754 7,130,077
Poultry feeds 811,272 768,215
Egg trays 575,130 459,639
Eggs 945,373 1,252,585
Medication 539,193 599,473
Consumable supplies 465,169 485,311
Work-in-progress 181,658 -
41,392,909 41,536,378
Less : Allowance for slow moving inventories (274,422) (44,371)
41,118,487 41,492,007
At Net Realisable Value
Fishes 109,790 -
41,228,277 41,492,007
DERIVATIVE ASSETS
Group
2013 2012
Contract/ Contract/
Notional Derivative Notional Derivative
Amount Assets Amount Assets
RM RM RM RM
Forward foreign exchange contracts 5,076,000 16,725 - -
The Group does not apply hedge accounting. Forward foreign exchange contracts are used to hedge the Groups
receivables denominated in Singapore Dollar (SGD) for which firm commitments existed at the end of the
reporting period. The settlement dates on forward foreign exchange contracts range from 1 month to 4 months
after the end of the reporting period.
The Group has recognised a gain of RM 16,725 (2012 : RM NIL) arising from fair value changes of derivatives
during the financial year/period as disclosed in Note 24. The fair value changes were attributed to changes in the
foreign exchange spot and forward rates. The method and assumptions applied in determining the fair values of
derivatives are disclosed in Note 33.4.
11.
12.
(a)
(b)
Teo Seng
Capital Berhad
72
Annual
Report
2013
Teo Seng
Capital Berhad
73
Annual
Report
2013
(a)
(b)
(c)
(d)
DEPOSITS, BANK AND CASH BALANCES
Group Company
2013 2012 2013 2012
RM RM RM RM
Bank and cash balances 34,007,917 16,801,816 440,200 176,586
Fixed deposits placed with licensed banks 1,648,133 1,055,328 - -
35,656,050 17,857,144 440,200 176,586
Included in bank balances is an amount of RM NIL (2012 : RM 1,320,907) which is held in trust and registered
under the name of certain directors.
Fixed deposits placed with licensed banks of RM 118,350 (2012 : RM 118,350) is held in trust and registered
under the name of certain directors.
The average effective interest rate and maturity periods of fixed deposits placed with licensed banks of the Group
at the end of the reporting period are 2.9% (2012 : 2.8%) per annum and 30 to 365 days (2012 : 30 to 365 days)
respectively.
Fixed deposits placed with licensed banks of the Group of RM 529,783 (2012 : RM 936,978) have been pledged
to licensed banks as security for banking facilities granted to the Group (Note 16(a)).
SHARE CAPITAL
Group And Company
2013 2012
Number of Number of
Shares RM Shares RM
Authorised :
Ordinary shares of RM 0.20 each 250,000,000 50,000,000 250,000,000 50,000,000
Issued and fully paid-up :
Ordinary shares of RM 0.20 each 200,000,000 40,000,000 200,000,000 40,000,000
RESERVES
Group Company
2013 2012 2013 2012
RM RM RM RM
Non-Distributable
Fair value reserve 3,526 2,366 - -
Foreign exchange translation reserve (119,862) (100,557) - -
Revaluation reserve 4,031,856 4,031,856 - -
Reverse acquisition reserve (26,078,000) (26,078,000) - -
Share premium 8,010,827 8,010,827 8,010,827 8,010,827
(14,151,653) (14,133,508) 8,010,827 8,010,827
Distributable
Retained profits 106,765,178 85,341,150 26,190,441 14,820,038
92,613,525 71,207,642 34,201,268 22,830,865
13.
14.
15.
RESERVES (contd)
Fair value reserve
The fair value reserve represents the cumulative fair value changes (net of tax, where applicable) of
available-for-sale financial assets until they are disposed of or impaired.
Foreign exchange translation reserve
The foreign exchange translation reserve arose from the translation of the financial statements of foreign
subsidiary and is not distributable by way of dividends.
Revaluation reserve
The revaluation reserve represent the surpluses arising from the revaluation of certain property, plant and
equipment, net of deferred tax effect.
Share premium
Share premium arose from allotment of ordinary shares at premium net of share issue expenses.
Retained profits
Under the single tier tax system, tax on the Companys profits is the final tax and accordingly, any dividends to the
shareholders are not subject to tax.
BANK BORROWINGS
Group
2013 2012
RM RM
Current
Secured - Bank overdrafts 137,619 610,588
- Bankers' acceptances 9,126,000 6,471,000
- Term loans 806,560 756,858
Unsecured - Bank overdrafts 788,738 -
- Revolving credit 5,000,000 5,000,000
74,827,917 67,565,446
Non-current
Secured - Term loans 1,760,909 2,663,865
76,588,826 70,229,311
Total bank borrowings
Secured - Bank overdrafts 137,619 610,588
- Term loans 2,567,469 3,420,723
Unsecured - Bank overdrafts 788,738 -
- Revolving credit 5,000,000 5,000,000
76,588,826 70,229,311
15.
16.
(a)
(b)
(c)
(d)
(e)
Teo Seng
Capital Berhad
74
Annual
Report
2013
Teo Seng
Capital Berhad
75
Annual
Report
2013
(a)
(b)
(c)
(d)
(i)
(ii)
(iii)
(iv)
(v)
(i)
(ii)
BANK BORROWINGS (contd)
The secured bank borrowings of the Group are secured by the following :
Certain property, plant and equipment of certain subsidiaries (Note 5(c)) ;
Fixed deposits placed with licensed banks of certain subsidiaries (Note 13(d)) ;
Negative pledge on a subsidiarys assets ;
Guarantee provided by the Company ; and
Joint and several guarantee provided by a director of a subsidiary and third party.
The unsecured bank borrowings of the Group are :
Guaranteed by the Company ; and
Negative pledge on subsidiaries assets.
The average effective interest rate (% per annum) at the end of the reporting period for bank borrowings were as
follows :
Group
2013 2012
% %
Bank overdrafts 8.2 8.3
Bankers' acceptances 4.5 4.6
Term loans 6.5 6.5
Revolving credit 5.1 5.1
The term loans are repayable by 60 to 84 monthly instalments (2012 : 60 to 84 monthly instalments). At the end of
the reporting period, they are repayable as follows :
Group
2013 2012
RM RM
Current
Not later than one year 806,560 756,858
Non-current
Later than one year and not later than two years 854,503 801,799
Later than two years and not later than five years 906,406 1,862,066
1,760,909 2,663,865
2,567,469 3,420,723
HIRE PURCHASE PAYABLES
Group
2013 2012
RM RM
Minimum hire purchase payments
Not later than one year 6,591,264 8,660,573
Later than one year and not later than two years 2,444,122 5,296,402
9,804,889 15,278,649
Less : Future finance charges (704,484) (1,136,562)
Present value of hire purchase payables 9,100,405 14,142,087
16.
17.
(a)
(b)
HIRE PURCHASE PAYABLES (contd)
Group
2013 2012
RM RM
Current
Not later than one year 6,111,265 7,960,813
Non-current
Later than one year and not later than two years 2,261,758 4,954,113
2,989,140 6,181,274
9,100,405 14,142,087
The hire purchase payables of the Group of RM 6,045,119 and RM 12,354 (2012 : RM 10,747,462 and RM
254,843) are guaranteed by the Company and intermediate holding company respectively.
The effective interest rates of hire purchase payables are ranging from 3.8% to 7.5% (2012 : 3.4% to 7.5%) per
annum.
TRADE AND OTHER PAYABLES
Group Company
2013 2012 2013 2012
RM RM RM RM
Trade Payables
Amount due to related companies 2,823,041 1,351,688 - -
Amount due to related parties - 885,615 - -
Other trade payables 12,074,824 12,502,272 - -
14,897,865 14,739,575 - -
Other Payables
Amount due to director of subsidiary 149,012 161,608 - -
Amount due to intermediate holding company 5,050 4,979 - -
Amount due to subsidiary - - 216,890 11,107,927
Amount due to related company 8,612 21 - -
Amount due to related parties 435,697 462,020 - -
Accruals 8,427,218 4,777,193 610,193 206,892
Sundry payables 5,930,899 4,115,764 17,652 49,279
14,956,488 9,521,585 844,735 11,364,098
29,854,353 24,261,160 844,735 11,364,098
The normal trade terms granted to the Group range from cash term to 90 days (2012 : cash term to 90 days) from
the date of invoices.
The non-trade amounts due to director of subsidiary, intermediate holding company, related company and related
parties are unsecured, interest free and repayable on demand.
The amount due to subsidiary is unsecured, interest free and repayable on demand except for the advances of
RM 216,890 (2012 : RM 11,107,927) which bears interest at 3.3% (2012 : 3.3%) per annum at the end of the
reporting period.
Included in sundry payables of the Group and of the Company is an amount of RM 2,756,277 and RM 6,502 (2012
: RM 1,211,602 and RM 38,746) respectively payable for the purchase of property, plant and equipment (Note
5(g)).
17.
18.
(a)
(b)
(c)
(d)
Teo Seng
Capital Berhad
76
Annual
Report
2013
Teo Seng
Capital Berhad
77
Annual
Report
2013
REVENUE
Revenue of the Group and of the Company comprises the following amounts :
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Sale of goods 330,758,670 197,534,880 - -
Dividend income from :
Subsidiaries - - 15,388,000 3,514,000
Other investment 160 150 - -
Management fee - - 360,000 270,000
330,758,830 197,535,030 15,748,000 3,784,000
INVESTMENT REVENUE
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Interest income from :
Fixed deposits placed with licensed banks 24,216 22,373 - -
Advance to subsidiaries - - 26,612 28,663
Others 35,857 49,296 12,511 14,052
60,073 71,669 39,123 42,715
DIRECTORS REMUNERATION
The aggregate amounts of remuneration received and receivable by the directors of the Group and of the Company
during the financial year/period are as follows :
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Executive directors of the Company
Fee 120,000 - 120,000 -
Salaries and other emoluments 3,918,251 631,100 562,042 253,550
Pension costs - defined contribution plan 223,402 77,460 57,180 31,290
Social security costs 2,420 1,417 1,181 708
4,264,073 709,977 740,403 285,548
19.
20.
21.
24,216 22,373
-
35,857 49,296 12,511 14,052
60,073 71,669 39,123 42,715
-
- 26,612 28,663
35,857 49,296 12,511 14,052
60,073 71,669 39,123 42,715
(a)
DIRECTORS REMUNERATION (contd)
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Non-executive directors of the Company
Fee 120,000 180,000 120,000 180,000
Salaries and other emoluments 573,805 315,759 20,000 -
Pension costs - defined contribution plan 79,896 40,797 - -
Social security costs 1,240 930 - -
774,941 537,486 140,000 180,000
5,039,014 1,247,463 880,403 465,548
Executive directors of the subsidiaries
Salaries and other emoluments 4,911,595 1,561,960 - -
Pension costs - defined contribution plan 507,163 206,952 - -
Social security costs 4,752 3,453 - -
5,423,510 1,772,365 - -
Non-executive directors of the subsidiaries
Fee 72,000 54,000 - -
Salaries and other emoluments 49,000 - - -
121,000 54,000 - -
5,544,510 1,826,365 - -
10,583,524 3,073,828 880,403 465,548
Analysed as follow :
Total executive directors' remuneration 9,687,583 2,482,342 740,403 285,548
Total non-executive directors' remuneration 895,941 591,486 140,000 180,000
10,583,524 3,073,828 880,403 465,548
Key management personnel are defined as those persons having authority and responsibility for planning,
directing and controlling the activities of the Group and of the Company whether directly or indirectly.
The number of the Companys directors with total remuneration falling in bands of RM 150,000 are as follows :
The Company
2013 2012
Number of directors
Executive directors :
RM 300,001 - RM 450,000 - 2
RM 450,001 - RM 600,000 1 -
RM 1,050,001 - RM 1,200,000 1 -
RM 1,200,001 - RM 1,350,000 2 -
Non-executive directors :
RM 1 - RM 150,000 4 7
RM 150,001 - RM 300,000 1 1
RM 450,001 - RM 600,000 1 -
21.
(b)
(c)

-
1
1
2

4
1
1
Teo Seng
Capital Berhad
78
Annual
Report
2013
Teo Seng
Capital Berhad
79
Annual
Report
2013
STAFF COSTS
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Executive directors' remuneration (Note 21) 9,687,583 2,482,342 740,403 285,548
Other staff costs :
Salaries and other emoluments 22,211,009 14,175,938 525,151 132,250
Pension costs - defined contribution plan 1,399,358 936,053 34,991 22,341
Social security costs 137,353 97,508 2,597 1,859
Other staff related expenses 1,756,335 1,277,703 77,304 16,972
25,504,055 16,487,202 640,043 173,422
Total staff costs 35,191,638 18,969,544 1,380,446 458,970

FINANCE COSTS
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Interest on :
Bank overdrafts 121,613 106,781 - -
Bankers' acceptances 2,804,115 1,726,369 - -
Hire purchase 737,800 684,453 - -
Term loans 169,627 173,618 - -
Revolving credit 255,000 63,435 - -
Advance from subsidiary - - 373,607 267,060
Others - 767 - -
4,088,155 2,755,423 373,607 267,060
22.
23.
PROFIT BEFORE TAX
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
This is arrived at after charging :
Allowance for impairment losses on trade receivables 282,550 247,027 - -
Allowance for slow moving inventories 242,485 15,476 - -
Auditors' remuneration :
Statutory audit :
- current financial year/period 120,612 107,979 18,000 18,000
- (over)provision in prior years (1,736) - - -
Non-statutory audit :
- current financial year/period 15,000 10,000 15,000 10,000
- (over)provision in prior years - (20,164) - (20,164)
Bad debts written off 94,313 11,204 - -
Depreciation :
- property, plant and equipment 10,510,050 7,728,047 97,184 58,844
- investment property 3,225 5,806 - -
Goodwill on consolidation written off - 288,215 - -
Inventories written off 45,254 17,765 - -
Property, plant and equipment written off 141,833 315,713 - -
Rental of hostel 3,660 9,450 - -
Rental of machinery and vehicle 2,947 - - -
Rental of premises 259,862 205,088 - -
Unrealised loss on foreign exchange - 30,812 - -
And crediting :
Fair value gain on derivatives (16,725) - - -
Gain on disposal of property, plant and equipment (546,188) (133,275) - -
Gain on disposal of investment property (90,695) - - -
Insurance compensation (152,728) (310,527) - -
Rental income (31,596) (25,745) - -
Reversal of allowance for slow moving inventories (12,434) - - -
Reversal of allowance for impairment
losses on trade receivables (256,931) (421,490) - -
Realised gain on foreign exchange (1,307,756) (749,236) - -
Unrealised gain on foreign exchange (195,603) - - -
24.
Teo Seng
Capital Berhad
80
Annual
Report
2013
Teo Seng
Capital Berhad
81
Annual
Report
2013
TAX EXPENSE
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Components of tax expense
Current tax expense :
- Malaysian income tax 5,832,000 3,144,000 47,000 44,000
- (Over)/Underprovision in prior years (552,306) (262,651) - 851
5,279,694 2,881,349 47,000 44,851
Deferred tax expense (Note 10) :
- Relating to origination/(reversal)
of temporary differences 1,305,370 (2,310,000) - -
- (Over)provision in prior years (34,474) (54,000) - -
1,270,896 (2,364,000) - -
Real property gains tax 35,173 48,068 - -
6,585,763 565,417 47,000 44,851
Reconciliation of effective tax rate
Profit before tax 29,961,076 1,142,662 13,417,403 2,570,460
Tax at Malaysian statutory income tax rate of 25% 7,490,000 286,000 3,354,000 643,000
Differential in tax rates (165,000) 77,000 - -
Tax effect of non-taxable income (135,000) - (3,847,000) (879,000)
Tax effect of non-deductible expenses 1,071,000 418,000 540,000 280,000
Effect of tax incentive (638,000) (188,000) - -
Deferred tax assets not recognised
during the financial year/period 51,000 241,000 - -
Real property gains tax 35,173 48,068 - -
Recognition of previously unrecognised
deferred tax assets (185,000) - - -
Utilisation of deferred tax assets
previously not recognised (351,630) - - -
(Over)/Underprovision in prior years :
- current tax expense (552,306) (262,651) - 851
- deferred tax expense (34,474) (54,000) - -
6,585,763 565,417 47,000 44,851
Subject to the agreement of the Inland Revenue Board, at 31 December, the Group has unutilised reinvestment
allowances of approximately RM 2,100,000 (2012 : RM 5,300,000) available for offsetting against future taxable
profits.
25.
(a)
(b)
(c)
(a)
(b)
EARNINGS PER ORDINARY SHARE
Basic earnings per ordinary share
Basic earnings per ordinary share is calculated based on profit for the financial year/period attributable to owners
of the Company divided by the weighted average number of ordinary shares in issue during the financial
year/period.
Group
9 Months
Financial Financial
Year Ended Period Ended
31 December 31 December
2013 2012
RM RM
Profit attributable to owners of the Company 23,424,028 773,244

2013 2012
Units Units
Number of ordinary shares in issue at 31 December 200,000,000 200,000,000
Weighted average number of ordinary shares in issue 200,000,000 200,000,000
Basic earnings per ordinary share (sen) 11.71 0.39
Diluted earnings per ordinary share
The diluted earnings per ordinary share was not applicable as there were no dilutive potential ordinary shares
outstanding at the end of the reporting period.
DIVIDENDS
Group and Company
9 Months
Financial Financial
31 December 31 December
2013 2012
RM RM
In respect of the financial year ended 31 March 2012
Final single tier dividend of 8.75% on 200,000,000 ordinary shares of RM 0.20 each - 3,500,000
In respect of the financial year ended 31 December 2013
An interim single tier dividend of 5.0% on 200,000,000 ordinary shares of RM 0.20 each 2,000,000 -
2,000,000 3,500,000
A final single tier dividend of 7.5% equivalent to 1.5 sen per ordinary share amounting to RM 3,000,000 in respect of
the current financial year will be proposed for shareholders approval at the forthcoming Annual General Meeting. The
financial statements for the current financial year do not reflect this proposed dividend. Such dividend, if approved by
the shareholders, will be accounted for as a liability in the financial year ending 31 December 2014.
26.
27.
Teo Seng
Capital Berhad
82
Annual
Report
2013
Teo Seng
Capital Berhad
83
Annual
Report
2013
CASH AND CASH EQUIVALENTS
For the purpose of the statements of cash flows, cash and cash equivalents comprise the following :
Group Company
2013 2012 2013 2012
RM RM RM RM
Deposits, bank and cash balances 35,656,050 17,857,144 440,200 176,586
Less : Bank overdrafts (926,357) (610,588) - -
34,729,693 17,246,556 440,200 176,586
Less : Deposits pledged to banks as collateral (529,783) (936,978) - -
34,199,910 16,309,578 440,200 176,586
CAPITAL COMMITMENTS
Group
2013 2012
RM RM
Contracted but not approved for :
Purchase of property, plant and equipment 297,000 629,000
Authorised but not contracted for :
Purchase of property, plant and equipment 1,770,000 3,449,000

RELATED PARTY DISCLOSURES
Identities of related parties
In addition to the information detailed elsewhere in the financial statements, the Group has related party
relationships with the following parties :
entities within the same group of companies ;
the executive directors who are the key management personnel ; and
entities controlled by certain directors.
28.
29.
30.
(a)
(i)
(ii)
(iii)
30. RELATED PARTY DISCLOSURES (contd)
Other than those disclosed elsewhere in the financial statements, the Group and the Company also carried out the
following significant transactions with the related parties during the financial year/period :
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Intermediate holding company
- IT service payable 6,768 6,958 - -
- Secretarial fee 8,520 6,210 - -
- Internal audit fee :
- overprovision in prior years - (20,164) - (20,164)
Subsidiaries
- Dividend income received/receivable - - (15,388,000) (3,514,000)
- Interest income - - (26,612) (28,663)
- Interest expense - - 373,607 267,060
- Management fee - - (360,000) (270,000)
Other related companies
- Sale of goods (12,614,933) (6,802,918) - -
- Purchase of goods 14,893,036 5,494,070 - -
- Laboratory charges 62,095 48,280 - -
- Transport charges - 620 - -
- Upkeep of equipment - 153 - -
- Proceeds from disposal of property
plant and equipment - (2,000) - -
Related parties
- with companies where Lau Brothers #
are directors/shareholders
- Sale of goods (14,410,323) (3,841,501) - -
- Purchase of goods 12,499,094 38,225,359 - -
- Net proceeds from contract farmer - (810,117) - -
- with company where spouse of
Mr. Nam Yok San is a director
- Transport charges 4,961,295 3,483,060 - -

- with company where a director of subsidiary
Mr. Tan Chau King is a director
- Sale of goods (171,070) (128,770) - -
- Transport charges received (12,939) (11,427) - -
- Rental of premises 7,900 5,400 - -
- Proceeds from disposal of property,
plant and equipment (15,000) - - -

- with Mr. Na Yok Chee, director of the Company
- Purchase of property, plant and equipment - 172,550 - -
(b)
Teo Seng
Capital Berhad
84
Annual
Report
2013
Teo Seng
Capital Berhad
85
Annual
Report
2013
RELATED PARTY DISCLOSURES (contd)
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Related parties
- with Mr. Nam Hiok Yong, director of subsidiaries
- Purchase of property, plant and equipment - 337,850 - -

- with Mr. Ng Eng Leng, director of subsidiaries
- Purchase of property, plant and equipment 938,215 - - -

- with Mr. Lim Meng Bin, director of subsidiary
- Purchase of property, plant and equipment 938,215 - - -
Lau Brothers are Dato Lau Bong Wong, Lau Chia Nguang, Datuk Lau Chir Nguan, Dato Lau Eng Guang, Lau
Hai Nguan and Tan Sri Lau Tuang Nguang collectively.
Information regarding outstanding balances arising from related party transactions at 31 December are disclosed
in Note 9 and Note 18.
Compensation of key management personnel
The compensation of key management personnel who are the executive directors of the Group and of the
Company are detailed in Note 21(a).
Group Company
9 Months 9 Months
2013 2012 2013 2012
RM RM RM RM
Fee 120,000 - 120,000 -
Salaries and other emoluments 8,829,846 2,193,060 562,042 253,550
Pension costs - defined contribution plan 730,565 284,412 57,180 31,290
Social security costs 7,172 4,870 1,181 708
9,687,583 2,482,342 740,403 285,548
OPERATING SEGMENTS
Operating segments are prepared in a manner consistent with the internal reporting provided to the Performance
Review Committees and Group Operating Committees to assess their performance and as its chief operating decision
maker in order to allocate resources to the segments respectively. For management purposes, the Group is organised
into business units based on their products and services provided.
The Group is organised into three main business segments as follows :
(i) Investment holding.
(ii) Trading of pet food, medicine and other related products.
(iii) Poultry farming.
30.
31.
(c)
(d)
#
31. OPERATING SEGMENTS (contd)
The Management assesses the performance of the operating segments based on operating profit or loss which is
measured differently from those disclosed in the consolidated financial statements.
Group financing (including finance costs) and income taxes are managed on a group basis and are not allocated to
operating segments.
Assets, liabilities and expenses which are common and cannot be meaningfully allocated to the operating segments
are presented under unallocated items. Unallocated items comprise mainly investments and related income, loans and
borrowings and related expenses, corporate assets (primarily the Companys headquarters) and head office expenses.
Inter-segment sales comprise sale of layers, eggs, animal feeds and egg trays under poultry farming based on agreed
terms between the companies in the Group.
Business Segments
Trading of
pet food,
medicine and
Investment other related Poultry
holding products farming Others Eliminations Group
RM RM RM RM RM RM
Group - 2013
Revenue
- External revenue - 122,045,675 208,685,449 27,706 - 330,758,830
- Inter-segment revenue 15,748,000 10,436,764 405,613,993 - (431,798,757) -
Total revenue 15,748,000 132,482,439 614,299,442 27,706 (431,798,757) 330,758,830
Segment results 13,751,887 7,522,320 29,226,392 (118,696) (16,389,373) 33,992,530
Unallocated expenses (3,372)
Investment revenue 60,073
Finance costs (4,088,155)
Profit before tax 29,961,076
Tax expense (6,585,763)
Profit after tax 23,375,313
Assets 74,523,400 42,810,948 299,273,849 9,949,252 (173,342,603) 253,214,846
Unallocated assets 683,781
Income producing assets 1,654,683
Tax recoverable 2,655,753
Consolidated total assets 258,209,063

Liabilities 844,735 22,389,017 103,765,796 7,196,872 (96,354,067) 37,842,353
Unallocated liabilities 602,000
Borrowings 85,689,231
Tax payable 1,532,224
Consolidated total liabilities 125,665,808
Other segment items
Capital expenditure 43,019 303,657 19,938,541 5,066,133 (2,958,858) 22,392,492
Depreciation 97,184 634,742 9,674,780 106,569 - 10,513,275
Non-cash items (other than
depreciation) - 358,044 (1,106,622) (10,928) 447,365 (312,141)
Teo Seng
Capital Berhad
86
Annual
Report
2013
Teo Seng
Capital Berhad
87
Annual
Report
2013
31. OPERATING SEGMENTS (contd)
Business Segments (contd)
Trading of
pet food,
medicine and
Investment other related Poultry
holding products farming Others Eliminations Group
RM RM RM RM RM RM
Group - 2012
Revenue
- External revenue - 65,068,949 132,452,550 13,531 - 197,535,030
- Inter-segment revenue 3,784,000 8,350,123 254,544,585 - (266,678,708) -
Total revenue 3,784,000 73,419,072 386,997,135 13,531 (266,678,708) 197,535,030
Segment results 2,794,805 4,722,902 (1,559,878) (123,501) (2,005,080) 3,829,248
Unallocated expenses (2,832)
Investment revenue 71,669
Finance costs (2,755,423)
Profit before tax 1,142,662
Tax expense (565,417)
Profit after tax 577,245
Assets 73,679,696 33,613,284 268,257,079 7,362,151 (161,416,824) 221,495,386
Unallocated assets 687,797
Income producing assets 1,060,718
Tax recoverable 4,385,403
Consolidated total assets 227,629,304
Liabilities 11,364,098 16,408,641 84,985,350 4,746,190 (86,829,659) 30,674,620
Unallocated liabilities 602,644
Borrowings 84,371,398
Tax payable 794,555
Consolidated total liabilities 116,443,217

Other segment items
Capital expenditure 177,893 217,953 12,397,365 2,657,767 - 15,450,978
Depreciation 58,844 465,991 7,173,959 35,059 - 7,733,853
Non-cash items (other than
depreciation) - 158,596 76,857 (152,209) 288,203 371,447
31.
32.
33.
OPERATING SEGMENTS (contd)
Geographical Information
Revenue Non-Current Assets
9 Months
Financial Financial
2013 2012 2013 2012
RM RM RM RM
Malaysia 230,234,798 147,013,213 142,485,591 131,636,842
Singapore 90,438,822 44,828,726 722,747 837,568
Others 10,085,210 5,693,091 - -
330,758,830 197,535,030 143,208,338 132,474,410
Major Customers
There was no revenue from one single customer that contributed to more than 10% of the Groups revenue.
SIGNIFICANT EVENT DURING THE FINANCIAL YEAR
On 10 January 2012, Success Century Sdn. Bhd. (SCSB), a wholly-owned subsidiary of the Company, entered into a
Memorandum of Understanding (MOU) with directors of certain subsidiaries, Mr. Lim Meng Bin and Mr. Ng Eng Leng
to acquire a piece of vacant freehold land held under Plot F of Lot 70 (now known as PTD 29431), Mukim of Tanjung
Sembrong, District of Batu Pahat, Johor for a total cash consideration of RM 1,876,430.
On 27 November 2012, the Company entered into a Sale and Purchase Agreement (SPA) to acquire this property. On
29 November 2013, the salient terms in the SPA have been fulfilled and completed. As of the report date, the
ownership of the property are yet to be transferred to SCSB.
FINANCIAL INSTRUMENTS
The Groups activities are exposed to a variety of market risks (including foreign currency risk, interest rate risk and
equity price risk), credit risk and liquidity risk. The Groups overall financial risk management policy focuses on the
unpredictability of financial markets and seeks to minimise potential adverse effects on the Groups financial
performance.
Teo Seng
Capital Berhad
88
Annual
Report
2013
Teo Seng
Capital Berhad
89
Annual
Report
2013
33. FINANCIAL INSTRUMENTS (contd)
Financial risk management policies
The Groups policies in respect of the major areas of treasury activity are as follows :
Market risk
Foreign currency risk
The Group is exposed to foreign currency risk on transactions and balances that are denominated in
currencies other than Ringgit Malaysia. The currencies giving rise to this risk are primarily Singapore
Dollar and United States Dollar. Foreign currency risk is monitored closely on an ongoing basis to ensure
that the net exposure is at an acceptable level. On occasion, the Group enters into forward foreign
exchange contracts to hedge against its foreign currency risk.
Foreign currency exposure
Singapore United States Ringgit
Dollar Dollar Others Malaysia Total
RM RM RM RM RM
Group - 2013
Financial assets
Other investment - - - 6,550 6,550
Trade and other receivables 7,059,919 294,847 105,548 26,083,584 33,543,898
Derivative assets 16,725 - - - 16,725
Deposits, bank and cash
balances 7,529,399 18,772 23,550 28,084,329 35,656,050
14,606,043 313,619 129,098 54,174,463 69,223,223
Trade and other payables (1,133,190) (2,232,492) - (26,488,671) (29,854,353)
Bank borrowings - - - (76,588,826) (76,588,826)
Hire purchase payables (42,171) - - (9,058,234) (9,100,405)
(1,175,361) (2,232,492) - (112,135,731) (115,543,584)
Net financial assets/
(liabilities) 13,430,682 (1,918,873) 129,098 (57,961,268) (46,320,361)
Less : Net financial (assets)/
liabilities denominated
in the respective entities
functional currencies (14,978,064) - - 57,961,268 42,983,204
Less : Forward foreign
exchange contracts
(contracted notional
principal) (5,076,000) - - - (5,076,000)
Currency exposure (6,623,382) (1,918,873) 129,098 - (8,413,157)
(a)
33.1
(i)
Financial Risk Management Policies (contd)
Market risk (contd)
Foreign currency risk (contd)
Foreign currency exposure (contd)
Singapore United States Ringgit
Dollar Dollar Others Malaysia Total
RM RM RM RM RM
Group - 2012
Financial assets
Other investment - - - 5,390 5,390
Trade and other receivables 5,496,596 658,209 86,624 21,545,823 27,787,252
Deposits, bank and cash
balances 3,378,746 25,626 25,540 14,427,232 17,857,144
8,875,342 683,835 112,164 35,978,445 45,649,786
Trade and other payables (870,596) (2,053,040) - (21,337,524) (24,261,160)
Bank borrowings - - - (70,229,311) (70,229,311)
Hire purchase payables (202,626) - - (13,939,461) (14,142,087)
(1,073,222) (2,053,040) - (105,506,296) (108,632,558)
Net financial assets/
(liabilities) 7,802,120 (1,369,205) 112,164 (69,527,851) (62,982,772)
Less : Net financial (assets)/
liabilities denominated
in the respective entities
functional currencies (6,525,440) - - 69,527,851 63,002,411
Currency exposure 1,276,680 (1,369,205) 112,164 - 19,639
Foreign currency risk sensitivity analysis
The following table details the sensitivity analysis to a reasonably possible change in the foreign
currencies at the end of the reporting period, with all other variables held constant :

Group
2013 2012
Increase/ Increase/
(Decrease) (Decrease)
RM RM
Effects on profit after tax
Singapore Dollar
- strengthened by 5% (248,377) 47,876
- weakened by 5% 248,377 (47,876)

United States Dollar
- strengthened by 5% (71,958) (51,345)
- weakened by 5% 71,958 51,345
(a)
33.1
(i)
Teo Seng
Capital Berhad
90
Annual
Report
2013
Teo Seng
Capital Berhad
91
Annual
Report
2013
Market risk (contd)
Interest rate risk
Interest rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate
because of changes in market interest rates. The Groups exposure to interest rate risk arises mainly from
interest-bearing financial assets and liabilities. The Groups policy is to obtain the most favourable
interest rates available. Any surplus funds of the Group will be placed with licensed financial institutions
to generate interest income.
Information relating to the Groups exposure to the interest rate risk of the financial liabilities is disclosed
in Note 33.1(c).
Interest rate risk sensitivity analysis
A 50 basis points increase/decrease in the interest rate at the end of the reporting period would have
immaterial impact on the profit or loss. This assumes that all other variables remain constant.
Equity price risk
The Groups principal exposure to equity price risk arises mainly from changes in quoted investment
prices. The Group manages its exposure to equity price risk by maintaining a portfolio of equities with
different risk profiles.
Equity price risk sensitivity analysis
A 50 basis points increase/decrease in the equity price risk at the end of the reporting period would have
immaterial impact on the profit or loss. This assumes that all other variables remain constant.
Credit risk
The Groups exposure to credit risk, or the risk of counterparties defaulting, arises mainly from trade and
other receivables. The Group manages its exposure to credit risk by the application of credit approvals, credit
limits and monitoring procedures on an ongoing basis. For other financial assets (including quoted
investments, bank and cash balances and derivatives), the Group minimises credit risk by dealing exclusively
with high credit rating counterparties.
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect
of the trade and other receivables as appropriate. The main components of this allowance are a specific loss
component that relates to individually significant exposures, and a collective loss component established for
groups of similar assets in respect of losses that have been incurred but not yet identified. Impairment is
estimated by management based on prior experience and the current economic environment.
Credit risk concentration profile
At the end of the reporting period, there were no significant concentrations of credit risk other than the trade
amounts due from related companies and related parties of RM 3,155,494 (2012 : RM 3,865,788).
(a)
(b)
33.1
(ii)
(iii)
Credit risk (contd)
Exposure to credit risk
As the Group does not hold any collateral, the Groups maximum exposure to credit risk is represented
by the carrying amount of each class of financial assets recognised at the end of the reporting period.
The exposure of credit risk for trade receivables by geographical region is as follows :
Group
2013 2012
RM RM
Malaysia 25,681,998 21,513,558
Singapore 7,058,678 5,498,762
Others 504,337 553,402
33,245,013 27,565,722
A nominal amount of RM 162,632,685 (2012 : RM 82,463,099) relating to financial guarantee provided by
the Company to licensed institutions for credit facilities granted to its subsidiaries.
The financial guarantees have not been recognised in the financial statements of the Company as the
requirement to reimburse are remote. The Company does not expect to incur material losses under these
corporate guarantees. At 31 December 2013, there was no indication that any subsidiaries would default
on payment.
Ageing analysis
The ageing analysis of the Groups trade receivables at the end of the reporting period is as follows :
Gross Individual Carrying
amount impairment amount
RM RM RM
Group - 2013
Not past due 30,404,515 - 30,404,515
Past due :
- less than 3 months 2,087,883 (22,239) 2,065,644
- 3 to 6 months 466,682 (105,466) 361,216
- over 6 months 785,262 (371,624) 413,638
33,744,342 (499,329) 33,245,013
Group - 2012
Not past due 24,801,101 - 24,801,101
Past due :
- less than 3 months 2,406,787 (12,552) 2,394,235
- 3 to 6 months 292,767 (20,165) 272,602
- over 6 months 538,777 (440,993) 97,784
28,039,432 (473,710) 27,565,722
At the end of the reporting period, trade receivables that are individually impaired were those in significant
financial difficulties and have defaulted on payments. These receivables are not secured by any collateral or
credit enhancement.
(b)
33.1
(i)
(ii)
Teo Seng
Capital Berhad
92
Annual
Report
2013
Teo Seng
Capital Berhad
93
Annual
Report
2013
Credit risk (contd)
Trade receivables that are past due but not impaired
The Group believes that no impairment allowance is necessary in respect of these trade receivables. They are
substantially companies with good collection track record and no recent history of default.
Trade receivables that are neither past due nor impaired
A significant portion of trade receivables that are neither past due nor impaired are regular customers that
have been transacting with the Group. The Group use ageing analysis to monitor the credit quality of the
trade receivables. Any receivables having significant balances past due or more than 150 days, which are
deemed to have higher credit risks, are monitored individually.
Liquidity risk
Liquidity risk arises mainly from general funding and business activities. The Group practises prudent risk
management by maintaining sufficient cash balances and the availability of funding through certain
committed credit facilities.
The following table sets out the maturity profile of the financial liabilities at the end of the reporting period
based on contractual undiscounted cash flows (including interest payments computed using contractual rates
or, if floating, based on the rates at the end of the reporting period) :
Average Contractual
effective Carrying undiscounted
interest rate amount cash flows Within 1 year 1-5 years
% RM RM RM RM
Group - 2013
Trade and other payables - 29,854,353 29,854,353 29,854,353 -
Bank borrowings
- Bank overdrafts 8.2 926,357 926,357 926,357 -
- Bankers' acceptances 4.5 68,095,000 68,095,000 68,095,000 -
- Term loans 6.5 2,567,469 2,797,305 927,267 1,870,038
- Revolving credit 5.1 5,000,000 5,000,000 5,000,000 -
Hire purchase payables 3.8 to 7.5 9,100,405 9,804,889 6,591,264 3,213,625
115,543,584 116,477,904 111,394,241 5,083,663
Group - 2012
Trade and other payables - 24,261,160 24,261,160 24,261,160 -
Bank borrowings
- Bank overdrafts 8.3 610,588 610,588 610,588 -
- Bankers' acceptances 4.6 61,198,000 61,198,000 61,198,000 -
- Term loans 6.5 3,420,723 3,840,748 927,267 2,913,481
- Revolving credit 5.1 5,000,000 5,000,000 5,000,000 -
Hire purchase payables 3.4 to 7.5 14,142,087 15,278,649 8,660,573 6,618,076
108,632,558 110,189,145 100,657,588 9,531,557
(b)
(c)
33.1
Liquidity risk (contd)
Contractual
Carrying undiscounted
amount cash flows Within 1 year
RM RM RM
Company - 2013
Trade and other payables 844,735 844,735 844,735
Company - 2012
Trade and other payables 11,364,098 11,364,098 11,364,098
Capital Risk Management
The Group manages its capital to ensure that entities within the Group will be able to maintain an optimal capital
structure so as to support their businesses and maximise shareholders value.
The Group manages its capital based on debt-to-equity ratio that complies with debt convenants and regulatory,
if any. The debt-to-equity ratio is calculated as total borrowings from financial institution divided by total equity.
There was no change in the Groups approach to capital management during the financial year/period.
The debt-to-equity ratio of the Group at the end of the reporting period was as follows :

Group
2013 2012
RM RM
Hire purchase payables 9,100,405 14,142,087
Bank borrowings 76,588,826 70,229,311
85,689,231 84,371,398
Less : Fixed deposits placed with licensed banks (1,648,133) (1,055,328)
Less : Cash and bank balances (34,007,917) (16,801,816)
Net debt 50,033,181 66,514,254

Total equity 132,543,255 111,186,087
Debt-to-equity ratio 0.38 0.60
Under the requirement of Bursa Malaysia Practice Note No. 17/2005, the Company is required to maintain a
consolidated shareholders equity (total equity attributable to owners of the Company) equal to or not less than
the 25% of the issued and paid-up share capital (excluding treasury shares) and such shareholders equity is not
less than RM 40 million. The Company has complied with this requirement.
33.1
33.2
(c)
Teo Seng
Capital Berhad
94
Annual
Report
2013
Teo Seng
Capital Berhad
95
Annual
Report
2013
FINANCIAL INSTRUMENTS (contd)
Classification of Financial Instruments
Group Company
2013 2012 2013 2012
RM RM RM RM
Financial assets
Available-for-sale financial assets
Other investment 6,550 5,390 - -
Loans and receivables financial assets
Trade and other receivables 33,543,898 27,787,252 1,145,270 799,360
Deposits, bank and cash balances 35,656,050 17,857,144 440,200 176,586
69,199,948 45,644,396 1,585,470 975,946
Fair value through profit or loss
Derivative assets 16,725 - - -
Other financial liabilities
Trade and other payables 29,854,353 24,261,160 844,735 11,364,098
Bank borrowings 76,588,826 70,229,311 - -
Hire purchase payables 9,100,405 14,142,087 - -
115,543,584 108,632,558 844,735 11,364,098
Fair value information
The following table provides the fair value measurement hierarchy of the Group's asset and liability:
Fair Value Of Financial Instruments
Carried At Fair Value
Total
Level 1 Level 2 Level 3 Fair Value
RM RM RM RM
Group - 2013
Financial Assets
Other investment
- quoted shares 6,550 - - 6,550
Derivative assets
- forward foreign exchange contracts - 16,725 - 16,725
Group - 2012
Financial Assets
Other investment
- quoted shares 5,390 - - 5,390
33.
33.3
33.4
FINANCIAL INSTRUMENTS (contd)
Fair value information (contd)
The fair values above have been determined using the following basis :
The fair values of quoted shares are measured at their quoted closing bid prices at the end of the reporting
period.
The fair values of forward foreign exchange contracts are determined using forward exchange rates at the
end of the reporting period with the resulting value discounted back to present value.
The fair values of the financial assets and financial liabilities maturing within the next 12 months approximated
their carrying amounts due to the relatively short-term maturity of the financial instruments.
The fair values of hire purchase payables were measured using present value technique by discounting the
expected future cash flows using observable current market interest rates for similar liabilities (i.e. Level 2). The
fair values measured were considered to be reasonably close to the carrying amounts reported as the
observable current market interest rates also approximated to the effective interest rates of hire purchase
payables.
The fair values of long-term loans are measured using present value technique by discounting the expected
future cash flows using observable current market interest rates for similar liabilities (i.e. Level 2). The fair values
measured are considered to be reasonably close to the carrying amounts reported as the observable current
market interest rates also approximate to the effective interest rates of long-term loans.
In regard to financial instruments carried at fair value, there were no transfer between level 1 and level 2 during
the financial year.
33.
33.4
(a)
(b)
Teo Seng
Capital Berhad
96
Annual
Report
2013
Teo Seng
Capital Berhad
97
Annual
Report
2013
SUPPLEMENTARY INFORMATION DISCLOSURE OF REALISED AND UNREALISED
PROFITS/LOSSES
The breakdown of the retained profits of the Group and the Company at the end of the reporting period into realised
and unrealised profits are presented in accordance with the directive issued by Bursa Malaysia Securities Berhad and
prepared in accordance with Guidance on Special Matter No. 1, Determination of Realised and Unrealised Profits or
Losses in the Context of Disclosure Pursuant to Bursa Malaysia Securities Berhad Listing Requirements, as issued by
the Malaysian Institute of Accountants, as follows :
Group Company
2013 2012 2013 2012
RM RM RM RM
Total retained profits of the Company
and its subsidiaries
- realised 138,576,611 115,172,169 26,190,441 14,820,038
- unrealised (8,074,672) (7,046,916) - -
130,501,939 108,125,253 26,190,441 14,820,038
Less : Consolidation adjustments (23,736,761) (22,784,103) - -
At 31 December 106,765,178 85,341,150 26,190,441 14,820,038
34.
Top 10 Properties Owned
By Teo Seng Capital Berhad And Its Subsidiaries
(Pursuant to Appendix 9C Part A (25) of Main Market Listing Requirements)
Location Description Tenure Land
Area
Age Of
Building
(Years)
Net
Book
Value
(Rm'000)
Date Of
Acquisition/
Revaluation
No
LIST OF PROPERTY,PLANT AND EQUIPMENT
*Date of Revaluation.
HS(D) 62613 PTD 29431
Mukim Tanjong Sembrong
Batu 4, Jalan Air Hitam, Johor
Lot 83, 89, 90 PTD 2513-2517
Jalan Kg Kangkar Baru
Daerah Batu Pahat, Johor
GM 455 Lot 4163
GM 456 Lot 4164
GM 1242 Lot 834
HS(D) 20359 Lot PTD 3547
All in Mukim Chaah Bahru
HS(M) 9808 PTD 25741
Mukim Tanjong Sembrong,
Tempat Yong Peng A.Hitam Road
HS(M) 9807 PTD 25740
Tempat Yong Peng A.Hitam Road
Lot 7087, 7088, 7090
GM4168 Lot156
Batu 5, Jalan Air Hitam
Daerah Batu Pahat Johor
GM 503 Lot 3660
GRN 81499 Lot 3667
HS (M) 12 MLO 201
GM 873 Lot 3830
All in Mukim Chaah Bahru
HS(M) 9806 PTD 25739
Tempat Batu 65 1/2
Jalan Ayer Hitam
Daerah Batu Pahat, Johor.
GM 3759 Lot 194
Batu 3, Jalan Muar
Lot 21 & 23
Jalan TPP 5/13, Seksyen 5
Taman Perindustrian Puchong
Selangor Darul Ehsan
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
Central Packing
Station 1
Layer Farm 9
Layer Farm 1
Layer Farm 1B
Feedmill Plant

Central Packing
Station 2 and
Corporate Office
Building
Layer Farm 8
Layer Farm 5
Layer Farm 5B
Paper Egg Tray
Plant
Layer Farm 10
Office cum
Factory building
Freehold
Freehold
Freehold
Freehold
Freehold

Freehold

Freehold
Freehold
Freehold
Freehold
Freehold
Freehold
Leasehold
(Expiring
On 28-10-
2101)
4.2387A
48.05A
15.78A
13A
4.20A

4.19A

16.40A
7.249A

20.97A
5.687A
3.450A
2.92A
11.26A
1,560 sq.
meter
2
8
5
5
13

7
6

9
4

18
4
4
19
5
12
5,754
5,260
5,209
5,026

4,802
4,288
3,570
3,098
2,688
2,573
Nov-12
*May-08
*Oct-07
*Oct-07
*Oct-07
Oct-09
*Mar-09
*Mar-09
Sep-94
*May-08
Sep-09
*Jun-95
*Jun-95
Apr-10
Apr-10
*Mar-09
Apr-08
Jan-09
*Sep-94
Teo Seng
Capital Berhad
98
Annual
Report
2013
Shareholdings Statistic
As At 9 May 2014
Teo Seng
Capital Berhad
99
Annual
Report
2013
Authorised Capital : RM50,000,000.00 divided into 250,000,000
ordinary shares of RM0.20 each
Issued and Paid-up Capital : RM40,000,000.00 divided into 200,000,000
ordinary shares of RM0.20 each
Class of Shares : Ordinary shares of RM0.20 each
Voting Shares : One vote per ordinary share
ANALYSIS BY SIZE SHAREHOLDINGS
Size of No of No of
Shareholdings Shareholders % Shares %
Less than 100 3 0.353 161 0.000
100 to 1,000 519 61.130 62,992 0.031
1,001 to 10,000 148 17.432 861,767 0.430
10,001 to 100,000 107 12.603 4,569,026 2.284
100,001 to 9,999,999 70 8.244 52,260,053 26.130
10,000,000 and above 2 0.235 142,246,001 71.123
Total 849 100.00 200,000,000 100.00
THIRTY LARGEST SHAREHOLDERS
Name No of Shares %
1 Advantage Valuations Sdn. Bhd. 102,246,001 51.12
2 Koperasi Permodalan Felda Malaysia Berhad 40,000,000 20.00
3 Lau Joo Kiang 5,441,766 2.720
4 Lau Joo Yong 2,808,500 1.404
5 Lau Joo Keat 2,767,000 1.383
6 Lau Joo Pern 2,767,000 1.383
7 EB Nominees (Tempatan) Sendirian Berhad 2,500,000 1.250
Pledged Securities Account for Amnah Binti Ibrahim (SFC)
8 Low Eng Guan 2,446,600 1.223
9 Tan Hang Phoo 2,082,700 1.041
10 Chee Kim Hoon 1,800,000 0.900
11 Boo Kim Hui 1,322,620 0.661
12 Leong Hup Holdings Sdn. Bhd. 1,284,837 0.642
13 JF Apex Nominees (Tempatan) Sdn. Bhd. 1,047,000 0.523
Pledged Securities Account for Teo Kwee Hock (Margin)
14 F.E Venture Sdn. Bhd. 1,000,000 0.500
15 Lee Kim Piew 1,000,000 0.500
16 Tong Seh Industries Supply Sdn. Berhad 1,000,000 0.500
17 Teo Sek Ching 971,450 0.485
18 Khoo Liong Hoo 950,000 0.475
19 Wong Lee Peng 942,520 0.471
20 Lau Joo Kiang 800,000 0.400
21 Tai Fook Hee 800,000 0.400
22 Soh Kian 744,370 0.372
23 Chen Wei Kuen 707,100 0.353
24 Normah Binti Mohamad Arip 601,000 0.300
25 Citigroup Nominees (Tempatan) Sdn. Bhd. 590,100 0.295
Pledged Securities Account for Ye Yu @ Ye Kim Onn (471503)
26 Lau Geok Jade 589,700 0.294
27 Alliancegroup Nominees (Tempatan) Sdn. Bhd. 580,000 0.290
Pledged Securities Account for Low Wee Kiat (8042510)
Shareholdings Statistic
As At 9 May 2014
THIRTY LARGEST SHAREHOLDERS (contd)
Name No of Shares %
28 Ku Leong Choon 580,000 0.290
29 Tan Chiou Huey 570,000 0.285
30 Citigroup Nominees (Tempatan) Sdn. Bhd. 532,000 0.266
UBS AG Singapore for Normah Binti Mohamad Arip
Total 181,472,264 90.736
SUBSTANTIAL SHAREHOLDERS
As per Register of Substantial Shareholders
No of Shares Held
Shareholders Direct % Indirect %
Advantage Valuations Sdn. Bhd. 102,246,001 51.12 - -
Leong Hup Holdings Sdn. Bhd. 1,284,837 0.64 103,246,001
1
51.62
Unigold Capital Sdn. Bhd. - - 102,246,001
1
51.12
Emerging Glory Sdn Bhd - - 104,730,838
2
52.37
CW Lau & Sons Sdn Bhd - - 104,730,838
3
52.37
Dato' Lau Bong Wong - - 104,730,838
3
52.37
Lau Joo Hong - - 104,730,838
4
52.37
Lau Jui Peng - - 104,730,838
4
52.37
Lau Joo Heng - - 104,730,838
4
52.37
Na Hap Cheng 60,526 0.03 102,254,001
5&6
51.13
Nam Yok San - - 102,254,001
5&6
51.13
Na Yok Chee 1,450 Negligible 102,246,001
5
51.12
Koperasi Permodalan Felda Malaysia Berhad 40,000,000 20.00 - -
DIRECTORS' INTEREST
As per Register of Directors' Shareholdings
No of Shares Held
Directors Direct % Indirect %
Lau Jui Peng - - 104,730,838
4
52.37
Nam Yok San - - 102,254,001
5&6
51.13
Na Yok Chee 1,450 Negligible 102,246,001
5
51.12
Tan Sri Lau Tuang Nguang - - 212,800
6
0.11
Dato Zainal Bin Hassan - - - -
Dato Koh Low @ Koh Kim Toon - - - -
Lau Joo Han - - - -
Loh Wee Ching - - - -
Choong Keen Shian - - - -
Frederick Ng Yong Chiang - - - -
Notes:
1. Deemed interested by virtue of its/his interest in Advantage Valuations Sdn. Bhd. and/or subsidiaries pursuant to Section 6A(4) of the
Companies Act, 1965 ( the Act.).
2. Deemed interested by virtue of its interest in Leong Hup Holdings Sdn. Bhd. and/or subsidiaries pursuant to Section 6A(4) of the Act.
3. Deemed interested by virtue of their interest in Emerging Glory Sdn. Bhd. pursuant to Section 6A(4) of the Act.
4. Deemed interested by virtue of their interest in CW Lau & Sons Sdn. Bhd. pursuant to Section 6A(4) of the Act.
5. Deemed interested by virtue of their interest in Unigold Capital Sdn. Bhd. pursuant to Section 6A(4) of the Act.
6. Deemed interested by virtue of his indirect equity interest in Teo Seng Capital Berhad via his spouse and/or children.
Teo Seng
Capital Berhad
100
Annual
Report
2013
Notice Of Eighth
Annual General Meeting
Teo Seng
Capital Berhad
101
Annual
Report
2013
AGENDA
AS ORDINARY BUSINESS
To receive the Audited Financial Statements of the Company and of the Group
and the Reports of the Directors and the Auditors thereon for the financial year
ended 31 December 2013;
To approve the payment of final dividend of 7.5%, in respect of the financial year
ended 31 December 2013 under the single-tier systems;
To approve Directors' fees for the financial year ended 31 December 2013;
To re-elect the following Directors who retire pursuant to Article 103 of the
Companys Articles of Association :
4.1 Mr Loh Wee Ching
4.2 Mr Choong Keen Shian
4.3 Mr Frederick Ng Yong Chiang
To re-appoint Messrs. Crowe Horwath as auditors of the Company for the
ensuing year and to authorise the Directors to fix their remuneration.
AS SPECIAL BUSINESS
To consider and if thought fit, to pass the following resolutions as Ordinary
Resolutions:-
PROPOSED ISSUANCE OF NEW ORDINARY SHARES OF RM0.20 EACH
PURSUANT TO SECTION 132D OF THE COMPANIES ACT, 1965
"THAT subject always to the Companies Act, 1965, the Articles of Association of
the Company and the approvals of the relevant regulatory authorities, the
Directors be and are hereby empowered pursuant to Section 132D of the
Companies Act, 1965, to issue new ordinary shares of RM0.20 each in the
Company from time to time and upon such terms and conditions to such persons
and for such purposes as the Directors may deem fit PROVIDED THAT the
aggregate number of new ordinary shares to be issued pursuant to this resolution
does not exceed ten per centum (10%) of the total issued share capital of the
Company and that such authority shall unless revoked or varied by an ordinary
resolution by the shareholders of the Company in general meeting commence
upon the passing of this resolution until the conclusion of the next annual general
meeting of the Company AND THAT the Directors are further authorised to do all
such things and upon such terms and conditions as the Directors may deem fit
and expedient in the best interest of the Company to give effect to the issuance of
new ordinary shares under this resolution including making such applications to
Bursa Malaysia Securities Berhad for the listing of and quotation for the new
ordinary shares to be issued pursuant to this resolution."
(Please refer Explanatory Note 1)
[Resolution 1]
[Resolution 2]
[Resolution 3]
[Resolution 4]
[Resolution 5]
[Resolution 6]
[Resolution 7]
1.
2.
3.
4.
5.
6.
NOTICE IS HEREBY GIVEN THAT the Eighth Annual General Meeting of the Company will be held at Jasmine
A & B Conference Room, Fourth Floor, Riverview Hotel, 29 Jalan Bentayan, 84000 Muar, Johor on Wednesday,
25 June 2014 at 11.00 am to transact the following businesses:
Notice Of Eighth
PROPOSED SHAREHOLDERS MANDATE FOR RECURRENT RELATED PARTY
TRANSACTIONS OF A REVENUE OR TRADING NATURE
"THAT, subject to the provisions of the Listing Requirements of Bursa Malaysia
Securities Berhad, the Company and/or its subsidiary companies (the Group) be
and are hereby authorised to enter into and give effect to the recurrent related
party transactions of a revenue or trading nature with the related party as set out in
Part B Section 2 of the Circular to Shareholders dated 3 June 2014 (the Related
Party) provided that such transactions and/or arrangements are:-
necessary for the day-to-day operations;
undertaken in the ordinary course of business and at arms length basis and
on normal commercial terms which are not more favourable to the Related
Party than those generally available to the public; and
are not prejudicial to the minority shareholders of the Company
(the Shareholders Mandate)
AND THAT such approval, shall continue to be in force until:-
the conclusion of the next Annual General Meeting ("AGM") of the Company
following this AGM at which the Shareholders Mandate is passed, at which
time it will lapse, unless by a resolution passed at such AGM whereby the
authority is renewed; or
the expiration of the period within the next AGM of the Company after that
date is required to be held pursuant to Section 143(1) of the Companies Act,
1965 ("Act") (but shall not extend to such extension as may be allowed
pursuant to Section 143(2) of the Act); or
revoked or varied by a resolution passed by the shareholders of the Company
in a general meeting;
whichever is earlier;

AND THAT the Directors of the Company be and are hereby authorised to
complete and do all such acts and things (including executing all such documents
as may be required) as they may consider expedient or necessary to give effect to
the Shareholders Mandate.
PROPOSED RENEWAL OF AUTHORISATION TO ENABLE TEO SENG CAPITAL
BERHAD TO PURCHASE UP TO 10% OF THE ISSUED AND PAID-UP
ORDINARY SHARE CAPITAL OF THE COMPANY
THAT, subject always to the compliance with all applicable laws, guidelines, rules
and regulations and the approval of all relevant authorities, the Company be and is
hereby authorised to purchase such amount of ordinary shares of RM0.20 each in the
Company as may be determined by the Directors of the Company from time to time
through Bursa Malaysia Securities Berhad upon such terms and conditions as the
Directors may deem fit and expedient in the interest of the Company provided that:-
the aggregate number of shares purchased does not exceed ten per centum
(10%) of the total issued and paid-up share capital of the Company as quoted on
Bursa Malaysia Securities Berhad as at the point of purchase;
the maximum fund to be allocated by the Company for the purpose of
purchasing the shares shall be backed by an equivalent amount of retained
profits and share premium; and
the Directors of the Company may decide either to retain the shares purchased
as treasury shares or cancel the shares or retain part of the shares so purchased
as treasury shares and cancel the remainder or to resell the shares or distribute
the shares as dividends.
[Resolution 8]
[Resolution 9]
7.
8.
(a)
(b)
(c)
(a)
(b)
(c)
(i)
(ii)
(iii)
Teo Seng
Capital Berhad
102
Annual
Report
2013
Notice Of Eighth
Teo Seng
Capital Berhad
103
Annual
Report
2013
THAT the authority conferred by this resolution will commence after the passing of
this ordinary resolution and will continue to be in force until:-
the conclusion of the next Annual General Meeting (AGM) at which time it
shall lapse unless by ordinary resolution passed at the meeting, the authority
is renewed, either unconditionally or subject to conditions; or
the expiration of the period within which the next AGM after that date is
required by law to be held; or
revoked or varied by ordinary resolution passed by the shareholders of the
Company in a general meeting;

whichever occurs first.
AND THAT authority be and is hereby given unconditionally and generally to the
Directors of the Company to take all such steps as are necessary or expedient
(including without limitation, the opening and maintaining of central depository
account(s) under the Securities Industry (Central Depositories) Act 1991 of
Malaysia, and the entering into all other agreements, arrangements and guarantee
with any party or parties) to implement, finalise and give full effect to the aforesaid
purchase with full powers to assent to any conditions, modifications, revaluations,
variations and/or amendments (if any) as may be imposed by the relevant
authorities and with the fullest power to do all such acts and things thereafter
(including without limitation, the cancellation or retention as treasury shares of all
or any part of the purchased shares or to resell the shares or distribute the shares
as dividends) in accordance with the requirements and/or guidelines of Main
Market Listing Requirements of Bursa Malaysia Securities Berhad and all other
relevant governmental and/or regulatory authorities."
To transact any other business that may be transacted at an annual general
meeting of which due notice shall have been given in accordance with the
Company's Articles of Association and the Companies Act, 1965.
NOTICE OF DIVIDEND ENTITLEMENT AND PAYMENT
NOTICE IS ALSO HEREBY GIVEN THAT the final dividend of 7.5%, in respect of the
financial year ended 31 December 2013 under the single-tier systems, if approved by
the shareholders at the Eighth Annual General Meeting, will be paid on 22 July 2014.
The entitlement date for the dividend payment is on 11 July 2014.
A depositor shall qualify for entitlement to the dividend only in respect of:-
Shares transferred into the Depositors Securities Account before 5.00 p.m. on 11
July 2014 in respect of transfers; and
Shares bought on Bursa Malaysia Securities Berhad on a cum entitlement basis
according to the Rules of Bursa Malaysia Securities Berhad.
By order of the Board,
LIM MENG BIN (LS 005798)
WONG WAI FOONG (MAICSA 7001358)
TAN BEE HWEE (MAICSA 7021024)
Secretaries
Yong Peng
3 June 2014
9.
(i)
(ii)
(iii)
(a)
(b)
Notice Of Eighth
EXPLANATORY NOTES
Item 1 of the Agenda
This Agenda item is meant for discussion only as the provision of Section 169(1) of the Companies Act, 1965 does not
require a formal approval of the shareholders for the Audited Financial Statements. Hence, this Agenda item is not put
forward for voting.
The proposed resolution 7 is the renewal of the mandate obtained from the members at the last Annual General Meeting
and if passed, will give the Directors authority to issue new ordinary shares up to an amount not exceeding 10% of the
issued share capital of the Company for such purposes as the Directors would consider to be in the best interest of the
Company. This would avoid any delay and cost involved in convening a general meeting to specifically approve such an
issue of shares. This authority will commence from the date of this Annual General Meeting and, unless earlier revoked or
varied by the shareholders of the Company at a subsequent general meeting, expire at the next annual general meeting.
The previous mandate was not utilised and accordingly no proceeds were raised.
The purpose of this general mandate is for possible fund raising exercises including but not limited to further placement
of shares for purpose of funding current and/or future investment projects, working capital, repayment of borrowings
and/or acquisitions.
The proposed resolution 8, if passed, will allow the Group to continue to enter into recurrent related party transactions
made on an arms length basis and on normal commercial terms and which are not prejudicial to the interests of the
minority shareholders. Please refer to Part B of the Circular to Shareholders dated 3 June 2014 for further information.
The proposed resolution 9, if passed, will allow the Company to purchase its own shares up to 10% of the total
issued and paid-up capital of the Company by utilising the funds allocated which shall not exceed the earnings and/or
share premium of the Company. Please refer to Part A of the Circular to Shareholders dated 3 June 2014 for further
information.
1.
2.
3.
4.
Notes:-
For the purpose of determining a member who shall be entitled to attend and vote at the Eighth Annual General Meeting, the Company
shall be requesting the Record of Depositors as at 18 June 2014. Only a depositor whose name appears on the Record of Depositors as at
18 June 2014 shall be entitled to attend and vote at the said meeting as well as for appointment of proxy(ies) to attend and vote on his/her
stead.
A member entitled to attend and vote at this meeting is entitled to appoint a proxy/(proxies or attorney) or authorised representative to
attend and vote in its stead.
A proxy may but need not be a member of the Company, an advocate, an approved company auditor or a person approved by the
Registrar of Companies. The provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company.
Where a member is an authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991, it may appoint at least
one proxy but not more than two (2) proxies in respect of each securities account it holds with ordinary shares of the Company standing to
the credit of the said securities account.
Where a member of the Company is an exempt authorised nominee which holds ordinary shares in the Company for the multiple beneficial
owners in one securities account (omnibus account), there is no limit to the number of proxies which the exempt authorised nominee may
appoint in respect of each omnibus account it holds.
Where a member or the authorised nominee appoints two (2) proxies, or where an exempt authorised nominee appoints two (2) or more
proxies, the proportion of shareholdings to be represented by each proxy must be specified in the instrument appointing the proxies.
The instrument appointing a proxy or the power of attorney or other authority, if any, under which it is signed or a notarially certified copy of
that power or authority shall be deposited at the registered office of the Company at 201-203, Jalan Abdullah, 84000 Muar, Johor, not less
than forty-eight (48) hours before the time for holding the meeting i.e. before 11.00 am, 23 June 2014.
If the appointer is a corporation, this form shall be executed under its common seal or under the hand of its officer or attorney duly
authorised.
If this Proxy Form is signed under the hands of an officer duly authorised, it should be accompanied by a statement reading signed as
authorised officer under Authorisation Document which is still in force, no notice of revocation having been received. If this Proxy Form is
signed under the attorney duly appointed under a power of attorney, it should be accompanied by a statement reading signed under
Power of Attorney which is still in force, no notice of revocation having been received. A copy of the Authorisation Document or the Power
of Attorney, which should be valid in accordance with the laws of the jurisdiction in which it was created and is exercised, should be
enclosed in the Proxy Form.
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
(ix)
Teo Seng
Capital Berhad
104
Annual
Report
2013
Proxy Form
I/We_______________________________________________________________________ NRIC No. ______________________________
of_______________________________________________________________________________________________________________
being a member(s) of TEO SENG CAPITAL BERHAD (Company No.:732762-T) hereby appoint __________________________________
___________________________________________________________________________ NRIC No. ______________________________
of_______________________________________________________________________________________________________________
or failing him/her, _____________________________________________________ NRIC No. ____________________________________
of ________________________________________________________________________________________________________________
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 Eighth Annual
General Meeting of the Company to be held at Jasmine A & B Conference Room, Fourth Floor, Riverview Hotel, 29 Jalan Bentayan, 84000
Muar, Johor on Wednesday, 25 June 2014 at 11.00 am and at any adjournment thereof. The proxy is to vote in the manner indicated
below, with an X in the appropriate spaces. If no specific direction as to voting is given, the proxy will vote or abstain from voting at
his/her discretion.
2.
3
4.1
4.2
4.3
5.
6.
7.
8.
1
2
3
4
5
6
7
8
9
1. To receive the Audited Financial Statements for the financial year ended 31 December 2013 and the
Reports of Directors and Auditors thereon.
To approve the payment of final dividend of 7.5%, in respect of the financial year ended 31 December
2013 under single-tier systems.
To approve Directors' fees for the financial year ended 31 December 2013.
To re-elect Mr Loh Wee Ching who retires as a Director of the Company pursuant to Article 103 of the
Companys Articles of Association.
To re-elect Choong Keen Shian who retires as a Director of the Company pursuant to Article 103 of
the Companys Articles of Association.
To re-elect Frederick Ng Yong Chiang who retires as a Director of the Company pursuant to Article
103 of the Companys Articles of Association.
To re-appoint Messrs. Crowe Horwath as auditors of the Company for the ensuing year and to
authorise the Directors to fix their remuneration.
Authority to Issue Shares.
Proposed Shareholders Mandate for Recurrent Related Party Transactions of a Revenue or Trading
Nature.
Proposed Renewal of Authorisation to enable Teo Seng Capital Berhad to Purchase up to 10% of the
Issued and Paid-up Ordinary Share Capital of the Company.
Item Agenda
Ordinary Resolutions Resolution FOR AGAINST
A member entitled to attend and vote at this meeting is entitled to appoint a proxy/(proxies or attorney) or authorised representative to attend and vote in its stead.
A proxy may but need not be a member of the Company, an advocate, an approved company auditor or a person approved by the Registrar of Companies. The
provisions of Section 149(1)(b) of the Companies Act, 1965 shall not apply to the Company.
Where a member is an authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991, it may appoint at least one proxy but not
more than two (2) proxies in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said securities account.
Where a member of the Company is an exempt authorised nominee which holds ordinary shares in the Company for the multiple beneficial owners in one
securities account (omnibus account), there is no limit to the number of proxies which the exempt authorised nominee may appoint in respect of each omnibus
account it holds.
Where a member or the authorised nominee appoints two (2) proxies, or where an exempt authorised nominee appoints two (2) or more proxies, the proportion of
shareholdings to be represented by each proxy must be specified in the instrument appointing the proxies.
The instrument appointing a proxy or the power of attorney or other authority, if any, under which it is signed or a notarially certified copy of that power or authority
shall be deposited at the registered office of the Company at 201-203, Jalan Abdullah, 84000 Muar, Johor, not less than forty-eight (48) hours before the time for
holding the meeting i.e. before 11.00 am, 23 June 2014.
If the appointer is a corporation, this form shall be executed under its common seal or under the hand of its officer or attorney duly authorised.
If this Proxy Form is signed under the hands of an officer duly authorised, it should be accompanied by a statement reading signed as authorised officer under
Authorisation Document which is still in force, no notice of revocation having been received. If this Proxy Form is signed under the attorney duly appointed under
a power of attorney, it should be accompanied by a statement reading signed under Power of Attorney which is still in force, no notice of revocation having been
received. A copy of the Authorisation Document or the Power of Attorney, which should be valid in accordance with the laws of the jurisdiction in which it was
created and is exercised, should be enclosed in the Proxy Form.
(i)
(ii)
(iii)
(iv)
(v)
(vi)
(vii)
(viii)
NOTES:-
Signed this ______________________ day of ______________________ 2014
_______________________________
Signature of Member/Common Seal
Number of shares held:
Date:
Seal
For appointment of two proxies, percentage of
shareholdings to be represented by the proxies :
No of shares Percentage
Proxy 1 %
Proxy 2 %
100 %
CDS Account No. of Authorised Nominee#
#applicable to shares held through nominee account
Please fold along this line (1)
Please fold along this line (2)
The Company Secretary
TEO SENG CAPITAL BERHAD
(Company No. 732762-T)
(Incorporated in Malaysia)
201-203, Jalan Abdullah
84000 Muar
Johor
Postage
Lot PTD 25740, Batu 4, Jalan Air Hitam, 83700 Yong Peng, Johor Darul Takzim, Malaysia.
Tel: 607-467 2289 Fax: 607-467 2923 Email: tscb@teoseng.com.my
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