penyata kewangan syarikat yeo's

7/14/2019 Penyata Kewangan Syarikat Yeo's

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Yeo Hiap Seng

(Malaysia) Berhad(3405-X)


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01 Corporate Information

02 Financial Highlights of the Group

03 Five-Year Summary

04 Directors Prole

10 Chairmans Statement

12 Penyata Pengerusi

14 Corporate Responsibility Statement

17 Statement on Corporate Governance

25 Statement on Internal Control

27 Audit Committee Report30 Directors Responsibilities Statement

31 Group Property Particulars

33 Financial Statements

116 Analysis of Shareholdings

118 Notice of Annual General Meeting

122 Statement Accompanying Notice of Annual General Meeting127 Administrative Detail for 38th Annual General Meeting

Form of Proxy

CONTENTS


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Annual Report 2011 01

Corporate Information

BOARD OF DIRECTORS

Koh Boon Hwee (Chairman)

Tjong Yik Min (Chief Executive Ofcer)

Dato Mohamed Nizam bin Abdul Razak

Dato N. Sadasivan a/l N.N. Pillay

Razman Hadz bin Abu Zarim

Chandra Das s/o Rajagopal Sitaram

Ow Tin NyapYap Ng Seng(Deputy Chief Executive Ofcer)

Pearl Foong Lye Fong

AUDIT COMMITTEE

Dato Mohamed Nizam bin Abdul Razak (Chairman)



Pearl Foong Lye Fong

REMUNERATION COMMITTEE

Dato N. Sadasivan a/l N.N. Pillay (Chairman)

Dato Mohamed Nizam bin Abdul Razak

Chandra Das s/o Rajagopal Sitaram

NOMINATION COMMITTEE

Razman Hadz bin Abu Zarim (Chairman)


Tjong Yik Min

INVESTMENT COMMITTEE

Dato Mohamed Nizam bin Abdul Razak (Chairman)



Tjong Yik Min

COMPANY SECRETARY

Sau Ean Nee

AUDITORS

PricewaterhouseCoopers

BANKERS

Citibank Berhad

Standard Chartered Bank Malaysia Berhad

Malayan Banking Berhad

SOLICITORS

Raja, Darryl & Loh

REGISTRARS

Tricor Investor Services Sdn Bhd

Level 17, The Gardens North Tower,

Mid Valley City,

Lingkaran Syed Putra,

59200 Kuala Lumpur

Tel : (603) 2264 3883

Fax : (603) 2282 1886

REGISTERED OFFICE

7, Jalan Tandang,

46050 Petaling Jaya,Selangor Darul Ehsan

Tel : (603) 7787 3888

Fax : (603) 7781 3509

(603) 7782 2730

Email: [email protected]

Website: www.yeos.com.my

Customer Care Hotline: 1-300-80-2828

STOCK EXCHANGE LISTING

Main Market of Bursa Malaysia Securities Berhad


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Yeo Hiap Seng (Malaysia) Berhad (3405-X)02

Financial Highlights of the Group

2011RM000

2010RM000

RESULTS OF OPERATION

Revenue 533,381 471,234

Prot Before Taxation 32,487 7,660

Prot Attributable to Equity Holders of the Company 24,983 3,817

FINANCIAL POSITION

Net Current Assets 146,335 155,069

Net Tangible Assets 255,105 242,806

Total Tangible Assets 379,441 333,950

Paid Up Capital 153,548 153,548

Shareholders Equity 263,998 253,605

DIVIDENDS

Interim 3,436 5,726

Final 10,307* 10,307

Cover (Times) 1.82 0.24

PER SHARE

Net Tangible Assets (in RM) 1.67 1.59

Earnings Before Tax (in sen) 21.27 5.02

Earnings After Tax (in sen) 16.4 2.5

Dividend- Interim (net - in sen) 2.25 3.75

- Final (net - in sen) 6.75* 6.75

* Proposed nal dividend


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Five-Year Summary

2007RM000

2008RM000

2009RM000

2010RM000

2011RM000

Group Revenue 476,579 568,836 545,504 471,234 533,381

Prot/(Loss) Attributable to EquityHolders of the Company

(13,601)

2,229 (11,079) 3,817 24,983

Net Tangible Assets 273,825 260,162 240,802 242,806 255,105

Total Dividend 17,807 14,507 10,308 16,033 13,743*

* Includes proposed nal dividend (net)

Total Dividend (RM000)Net Tangible Assets (RM000)

Profit/(Loss) Attributable to Equity Holdersof the Company (RM000)

Group Revenue (RM000)

476,579

273,825

(13,601)

17,807

568,836

260,162

2,229

14,507

545,504

240,802

(11,079)

10,308

471,234

242,806

3,817

16,033

533,381

255,105

24,983

13,743*

07

07

07

07

09

09

09

09

08

08

08

08

10

10

10

10

11

11

11

11

0 200,000 400,000 600,000

0 100,000 200,000 300,000

-10,000 0 10,000 20,000

0 5,000 10,000 15,000 20,000


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Directors Prole

Koh Boon HweeChairman

Non-Independent / Non-Executive

Age: 61 years

Koh Boon Hwee is a Singaporean and he was

appointed to the Board on 20 January 2009 and as

Chairman of the Company on 22 April 2010.

He received his Bachelors Degree (First Class

Honours) in Mechanical Engineering from the

Imperial College of Science and Technology,

University of London, and his MBA (Distinction) from

the Harvard Business School.

He started his career in 1977 at Hewlett Packard and

became its Managing Director in Singapore, a post

he held from 1985 to 1990. From 1991 to 2000, he

was Executive Chairman of the Wuthelam Group.

Mr Koh is currently the Chairman of Yeo HiapSeng Limited, Chairman of Sunningdale Tech Ltd,

Chairman of AAC Technologies Holdings Inc, and a

board member of Agilent Technologies, Inc. in the

United States. Mr Koh contributes actively to non-

prot organisations, and is the current Chairman

of the Board of Trustees of Nanyang Technological

University, Singapore and a director of the Hewlett

Foundation in the United States.

He was formerly the Chairman of the Singapore

Telecom Group (SingTel) and its predecessor

organisations from 1986 to 2001, Chairman of

Singapore Airlines Limited from July 2001 to

December 2005 and Chairman of DBS Group and

DBS Bank from January 2006 to April 2010. He

served on the Board of Temasek Holdings Pte Ltd

from November 1996 to September 2010, and was a

member of the Executive Committee from January

1997 to September 2010.

Mr Koh attended all 5 Board meetings held in the

year.

He has no family relationship with any other

director/major shareholder of the Company and hasno conict of interest with the Company.

He has not been convicted for offences within the

past 10 years.


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Directors Prole (continued)

Dato Mohamed Nizam bin Abdul RazakDirector

Independent / Non-Executive

Age: 53 years

Dato Mohamed Nizam bin Abdul Razak is a

Malaysian and he was appointed to the Board on 5November 2002.

He graduated with a Bachelor of Arts (Oxon) degreein Politics, Philosophy and Economics from the

Oxford University, United Kingdom.

Dato Nizam was attached to Bumiputra MerchantBankers Berhad from 1981 to 1984 and to PB

Securities Sdn Bhd from 1984 to 1998. He presentlysits on the board of Mamee-Double Decker (M)

Berhad, Delloyd Ventures Berhad, Synergy TrackBerhad and Deutsche Bank (M) Berhad. He also

serves on the board of several private limited

companies engaged in a wide range of activitiesand is actively involved in several charitable

foundations.

Dato Nizam is the Chairman of the Audit andInvestment Committees and a member of the

Remuneration Committee.

Dato Nizam attended all 5 Board meetings held inthe year.




past 10 years.

Tjong Yik MinChief Executive Ofcer

Non-Independent / Executive

Age: 59 years

Tjong Yik Min is a Singaporean and he was appointedto the Board as a Director on 22 July 2002. He was

appointed as the Chief Executive Ofcer on 1 June2010.

He holds a Bachelor of Engineering (Hons) (Class

1) (Industrial Engineering) degree from theUniversity of Newcastle, Australia, a Bachelor of

Commerce (Economics) degree from the Universityof Newcastle, Australia and a Master of Science

(Industrial Engineering) degree from the Universityof Singapore.

Mr Tjong has been an Executive Director of Far East

Organization and a Director of Yeo Hiap Seng Limited(YHS Limited), Singapore and also its President

and Chief Operating Ofcer since 22 July 2002. He

was appointed the Group Chief Executive Ofcer of

YHS Limited on 26 April 2010. Prior to joining YHSLimited, he was the Executive Director and Group

President of Singapore Press Holdings Limited. MrTjong has also served in various capacities in the

Singapore Civil Service.

He presently sits on the boards of Orchard ParadeHoldings Limited and Genting Singapore PLC.

Mr Tjong is a member of the Nomination and

Investment Committees.

Mr Tjong attended all 5 Board meetings held in theyear.




past 10 years.


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Razman Hafdz bin Abu ZarimDirector


Age: 56 years

Razman Hadz bin Abu Zarim is a Malaysian and hewas appointed to the Board on 1 March 2005.

Encik Razman graduated with a Joint-Honours

degree in Economics and Accounting, BSc (Econ),

from University College, Cardiff, University ofWales. He is a Fellow of the Institute of CharteredAccountants in England and Wales and a member of

the Malaysian Institute of Accountants.

He started his career with Touche Ross & Co.,Chartered Accountants, London, England and

later joined Hacker Young, Chartered Accountants,London, England, where he was admitted as an

Audit Partner.

In 1989, he returned to Malaysia as an Audit Partnerof Price Waterhouse (PW) and later Partner-in-

Charge of PWs Management Consulting Practiceand became an Executive Committee member. In

1994, he established Norush Sdn Bhd, an investment

holding and business advisory rm, where heremains as Chairman.

He sits on the Boards of Panasonic Manufacturing

Malaysia Berhad, eBworx Berhad, Linde MalaysiaHoldings Berhad and Sumitomo Mitsui Banking

Corporation Malaysia Berhad. He also holdsdirectorships in several other private limited

companies.

Encik Razman is the Chairman of the NominationCommittee and a member of the Audit and

Investment Committees.

Encik Razman attended all 5 Board meetings heldin the year.




past 10 years.

Dato N. Sadasivan a/l N.N. PillayDirector


Age: 72 years

Dato N. Sadasivan is a Malaysian and he wasappointed to the Board on 13 August 2004.

Dato N. Sadasivan graduated with a Bachelor of Arts

(Hons) in Economics from the University of Malaya in1963. He began his career as an Economist with the

Economic Development Board, Singapore in 1963and was subsequently promoted to the position of

Chief of the Industrial Facilities Division in 1965.

In 1968, he joined the Malaysian IndustrialDevelopment Authority (MIDA) and served as the

Deputy Director General from 1976 to 1983. From1984 until his retirement in 1995, he was the

Director-General of MIDA.

He presently sits on the board of several private

and public listed companies namely Petronas GasBerhad, APM Automotive Holdings Berhad and

Leader Universal Holdings Berhad. He is also adirector of Bank Negara Malaysia.

Dato N. Sadasivan is the Chairman of the

Remuneration Committee and a member of theAudit, Nomination and Investment Committees.

Dato N. Sadasivan attended all 5 Board meetings

held in the year.

He has no family relationship with any otherdirector/major shareholder of the Company and has

no conict of interest with the Company.

He has not been convicted for offences within thepast 10 years.


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Chandra Das s/o Rajagopal SitaramDirectorIndependent / Non-ExecutiveAge: 72 years

Chandra Das s/o Rajagopal Sitaram is a Singaporeanwho received his Bachelor of Arts degree (withhonours) in Economics from the University ofSingapore in 1965 and he was appointed to theBoard on 26 April 2011.

Mr Das has over 37 years of experience primarily in

companies involved in the trading and manufacturingindustries. He served as the Singapore TradeRepresentative to the USSR from 1970 to 1971,Chairman of the Trade Development Board from1983 to 1986 and Chairman of NTUC Fairprice Co-operative Ltd from 1993 to 2005. He also served asa Member of Parliament in Singapore from 1980 to1996.

Mr Das is currently the Managing Director of NUR

Investment & Trading Pte Ltd, Singapores Non-Resident Ambassador to Turkey and also servesas Pro-Chancellor of Nanyang TechnologicalUniversity (NTU). He has been conferred numerousawards, such as the Presidents Medal by theSingapore Australian Business Council in 2000 andthe Distinguished Service (Star) Award by NationalTrades Union Congress in 2005. He also holdsdirectorships in various private and public listedcompanies in Singapore. Mr Das does not hold anyother directorship in public companies in Malaysia.

Mr Das attended 3 out of 3 Board meetings heldsince his appointment.

He has no family relationship with any otherdirector/major shareholder of the Company and hasno conict of interest with the Company.



Ow Tin NyapDirectorNon-Independent / Non-ExecutiveAge: 58 years

Ow Tin Nyap is a Malaysian and he was appointed tothe Board as Managing Director and Chief ExecutiveOfcer on 1 June 2005. He was re-designated as aNon-Executive Director on 1 March 2010.

Mr Ow holds the Malaysian Certicate of Education.In an illustrious and sterling career spanning 40years, Mr Ow brings with him strategic broad-based experience and many years of international

exposure in the areas of business re-engineering,mergers and acquisitions, sales and marketing,logistics and manufacturing. Mr Ows extensiveknowledge and experience stems from starting atrank and le positions to various senior managementappointments in fast-moving consumer goods(FMCG) market.

Mr Ow is currently a Non-Executive Director of YeoHiap Seng Limited, Singapore.

Mr Ow retired from his appointment as ExecutiveDirector at the end of February 2012, after a span of

more than 6 years with Far East Organization duringwhich he provided strategic leadership and businessdevelopment counsel to various business portfolios,driving the growth of Kitchen Language, leading

as Chairman of the Establishment Committee and

the Far East Academy, and playing an active rolein the Branding and Food & Beverage ExecutiveCommittees. With effect from March 2012, Mr Owwill continue to be the Deputy Chairman for Far EastAcademy, and also a member of the Branding andFood & Beverage Executive Committees.

Prior to this, Mr Ow has spent 8 years with theDanone Group; working to grow Danones ASEANportfolio and strategic market leadership. Mr Owspent his last 5 years in Indonesia as PresidentDirector of Danone Group of Companies and asChairman of Danone Group of Companies in theASEAN Region for Water/Beverages, Dairy andBiscuits from 2004. He was also a member of theAsia Pacic Matrix and he sat on the InternationalCommittee of Danone Group in Paris. Mr Ow hasalso previously held positions as President of SaraLee Corporation (SEA), overseeing the market ofMalaysia, Singapore and Indo China and GeneralManager of Boustead Trading (M) Sdn Bhd.

Mr Ow attended all 5 Board meetings held in the year.

He has no family relationship with any other director/major shareholders of the Company and has noconict of interest with the Company.



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Pearl Foong Lye FongDirectorNon-Independent / Non-Executive

Age: 46 years

Pearl Foong Lye Fong is a Singaporean and she wasappointed to the Board on 26 July 2005.

She graduated from National University of Singapore

in 1989 with a Bachelor of Accountancy Degree.

Ms Pearl Foong worked in Price Waterhouse as

Assistant Manager of Audit and Business Servicesfrom 1993 to 1995. From 1995 to February 1999,she was promoted to Manager of Assurance/

Business Advisory Services. In February 2000, sheleft PricewaterhouseCoopers as Senior Manager of

Assurance/Business Advisory Services.

She was appointed as Group Financial Controllerof Tuan Sing Holdings Limited and SP Corporation

Ltd, Singapore from March 2000 to October 2002.Subsequently, she worked with Gul Technologies

Singapore Ltd as Vice President of Finance andAccounting from November 2002 to 14 June 2005.

Ms Pearl Foong is a member of the Audit

Committee.

Ms Pearl Foong attended all 5 Board meetings heldin the year.

She has no family relationship with any other


She has not been convicted for offences within thepast 10 years.

Yap Ng SengDeputy Chief Executive Ofcer

Non-Independent / Executive

Age: 55 years

Yap Ng Seng is a Singaporean and he was appointedas an Executive Director and Deputy Chief Executive

Ofcer on 2 August 2010.

He graduated with a Bachelor of Engineering(Mechanical & Production Engineering) and a Master

of Science (Industrial Engineering) from NationalUniversity of Singapore. In 1994, he obtained a

Master of Business Administration (Accountancy)from Nanyang Technological University, Singapore.

He started his career as a Project Engineer in

Singapore Automotive Engineering Pte Ltd from

1982 to 1984. He then joined Singapore Aerospace

Manufacturing Pte Ltd as a Materials Manager from1984 to 1989. Before joining the Company, he was

attached to Crown Asia Pacic Holdings Ltd since1989 and his last position held was Vice President

South East Asia, responsible for 5 plants in SouthEast Asia.

Mr Yap attended all 5 Board meetings held in the

year.

He has no family relationship with any otherdirector/major shareholder of the Company and has

no conict of interest with the Company.



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Chairmans Statement

FINANCIAL PERFORMANCE

The nancial year ended 31 December 2011

(FY2011) has been another good year for

Yeos, marked by improving nancial results andimprovement in operations efciency.

The Groups operating revenue increased by 13%

to RM533 million for FY2011 compared to RM471

million in the previous year. The Group also achieved

prot from operations of RM30.8 million for this

year, an increase of RM11.2 million or a 57% growth

against RM19.6 million in year 2010. The increase in

prot was largely attributable to increased sales and

improvement in operations efciency.

The Group recorded prot after tax of RM25 million

against RM3.8 million achieved last year despite

volatility in currencies and escalating prices of

raw materials in the wake of uncertainty in global

markets.

The Groups nancial position remains healthy with a

net cash and short-term cash investment of RM47.1

million, with no borrowings.

DIVIDEND

On 12 October 2011, the Company had declared

and paid out an interim dividend of 3 sen (5 sen

in 2010) gross per ordinary share of RM1.00 each

less Malaysian income tax of 25%. The Board is

recommending for shareholders approval, a Final

Dividend of 9 sen (9 sen in 2010) gross per ordinary

share of RM1.00 each less Malaysian income tax of

25%, bringing the total dividend for the nancial year

to 12 sen gross per ordinary share of RM1.00 each.

OPERATIONS REVIEw

During the year, we have signicantly raised

our operating performance and strengthened

key functions. We remain focused on deliveringsustainable growth for our core products and also

evaluating various initiatives and opportunities to

attract new consumers through the introduction of

new products.

In line with the Governments call for a healthier

lifestyle, we launched Yeos Chrysanthemum Tea

Light with 40% Less Sugar, a healthier choice for

those who like beverages that contain less sugar. And

for those who want to hydrate their bodies quickly,

we introduced Yeos Sparkling H-Two-O, an isotonic

drink which replenishes the essential minerals and

uids in the body.

In the nancial year, the Group invested a

considerable amount in advertising and promotion

activities to enhance its brand leading position in

Asian stilled drinks category. Our market position

remains strong with 38% market share in Asian

stilled drinks category.

Beverage sales improved by 13% year on year and

sale of food products also grew by 15%.

The plant rationalisation exercise embarked

since 2010 has been progressing well. We have

successfully transferred the production of sauces

to Johor Bahru plant after closure of the Kuching

plant in 2010. The consolidation of Petaling Jaya

and Shah Alam plants is on schedule and we have

invested RM25 million in capital expenditure on plant

upgrading in 2011. We expect to realise signicant

annual savings when the exercise is completed in

2013.

On behalf of the Board of Directors of Yeo Hiap Seng (Malaysia) Berhad (Yeos), I am

pleased to present to you the Annual Report and Audited Financial Statements of the

Company and its Group of Companies for the nancial year ended 31 December 2011.


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Chairmans Statement

During the year, we have successfully re-launchedour products in Indonesia following the issuance

of new ML numbers by the Indonesian authority.

The sales in Indonesia have been encouraging and

we see huge potential in growing our brands and

distribution network.

CORPORATE RESPONSIBILITY

Yeos recognises the importance of corporate

responsibility as an integral part of the business to

create sustainable value for all our stakeholders,including our consumers, shareholders and

employees.

Yeos initiated a school recycling contest, a platform

for schools to educate and raise awareness about

the importance of recycling amongst the younger

generation and at the same time, emphasize

the importance of healthy living through better

understanding of food nutrition.

Inspired by the enthusiasm of the 60 primary

schools for the Yeos Program Susu Soya Sekolah

campaign held in year 2010, the Company continued

its campaign to reach out to an additional 100

primary schools in the Klang Valley by giving

educational talks on the importance of a balanced

diet and distributed Yeos soy milk to the students

from April to July 2011.

In this Annual Report, we have included a more

detailed write-up of our corporate responsibilityinitiatives to inform all our stakeholders of the

Companys engagement in the community and in

preserving the environment.

FUTURE STRATEGY AND PROSPECTS

The better performance in 2011 gives us condence

as we move into 2012 and the Board is optimistic in

spite of the challenges facing the global economy.

We will stay focused on our core products and

markets in the new nancial year while we build our

skills and capacity for the future. We are positive of

the future prospects and within 3 years, we plan to

invest RM190 million in new plant and technologies

and upgrading our facilities to prepare for future

growth.

ACKNOwLEDGEMENT AND APPRECIATION

On behalf of the Board, I would like to express

my sincere appreciation and gratitude to the

management and staff for their conscientious effort,

commitment and dedication to delivering results.

My appreciation also goes to our valued customers,

business associates, partners, and shareholders,for their continuing support of Yeos. To my fellow

Board members, I thank you for your contribution

and guidance throughout the year.

Stay Healthy and Lead a Joyful Life!

Koh Boon Hee

Chairman


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Penyata Pengerusi

PRESTASI KEwANGAN

Tahun kewangan berakhir 31 Disember 2011 (TK2011) merupakan satu tahun yang memberangsangkanbagi Yeos, nyata dengan peningkatan keputusan kewangan dan kecekapan dalam operasi.

Perolehan operasi Kumpulan meningkat sebanyak 13% kepada RM533 juta bagi TK2011 berbanding dengan

RM471 juta pada tahun sebelumnya. Kumpulan juga mencatatkan keuntungan daripada operasi sebanyakRM30.8 juta bagi tahun ini, iaitu peningkatan sebanyak RM11.2 juta, 57% lebih tinggi berbanding denganRM19.6 juta pada tahun 2010. Peningkatan dalam keuntungan sebahagian besar didorong oleh peningkatanjualan dan kecekapan dalam operasi.

Kumpulan telah mencatatkan keuntungan selepas cukai sebanyak RM25 juta berbanding dengan RM3.8juta yang dicapai pada tahun sebelumnya walaupun kadar pertukaran mata wang asing tidak stabil dan kosbahan mentah meningkat berikutan pasaran global yang tidak menentu.

Kedudukan kewangan Kumpulan kekal sihat dengan lebihan tunai dan pelaburan jangka pendek sebanyakRM47.1 juta, tanpa sebarang pinjaman.

DIVIDEN

Pada 12 Oktober 2011, pihak Syarikat telah mengumum dan membayar dividen interim sebanyak 3 sen(5 sen pada tahun 2010) tidak termasuk 25% Cukai Pendapatan Malaysia bagi setiap saham biasa yangbernilai RM1.00. Pihak Lembaga Pengarah mengesyorkan dividen akhir sebanyak 9 sen (9 sen pada tahun2010) tidak termasuk 25% Cukai Pendapatan Malaysia bagi setiap saham biasa yang bernilai RM1.00 untukkelulusan para pemegang saham. Jumlah dividen bagi TK2011 adalah sebanyak 12 sen bagi setiap sahambiasa yang bernilai RM1.00.

ULASAN OPERASI

Sepanjang tahun 2011, kami telah meningkatkan prestasi di bahagian operasi dan terus mengukuhkanfungsi-fungsi utama kami. Kami kekal fokus untuk mengembang perusahaan untuk produk dan jenamateras kami dan juga melaksanakan pelbagai inisiatif untuk menarik perhatian pengguna-pengguna baru

melalui pelancaran produk-produk baru.

Sejajar dengan seruan kerajaan ke arah gaya hidup sihat, kami telah memperkenalkan Teh KrisantimumLight Yeos dengan 40 peratus kurang gula, salah satu pilihan yang lebih sihat bagi mereka yang gemarminuman yang mengandungi kandungan gula yang lebih rendah. Dan bagi mereka yang mahu menghidrattubuh mereka dengan cepat, kami juga memperkenalkan Yeos Sparkling H-TWO-O, minuman isotonik yangboleh mengisikan semula mineral-mineral utama dan kandungan air dalam badan.

Dalam tahun 2011, Kumpulan telah membelanjakan sejumlah wang dalam pengiklanan dan aktiviti promosiuntuk mengukuhkan kedudukan jenamanya terutama bagi kategori minuman Asian. Kedudukan jenamakami kekal kukuh dengan 38% bahagian pasaran bagi kategori minuman Asian.

Jualan produk minuman dan makanan masing-masing meningkat sebanyak 13% dan 15%.

Projek rasionalisasi kilang telah dilaksanakan dengan lancar sejak tahun 2010. Dalam tahun 2010, kamitelah berjaya mengalihkan pengeluaran sos dari kilang pemprosesan Kuching ke Johor Bahru. Selain itu,penggabungan kilang pemprosesan Petaling Jaya dan Shah Alam sedang berjalan dengan lancar dan kami

Bagi pihak Lembaga Pengarah Yeo Hiap Seng (Malaysia) Berhad (Yeos), saya ingin

mengemukakan Laporan Tahunan dan Penyata Keangan yang telah diauditkan bagi

Syarikat dan Kumpulan bagi tahun keangan berakhir 31 Disember 2011.


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Pyt Ps

juga membelanjakan sebanyak RM25 juta dalam pembelanjaan modal untuk meningkatkan taraf kilang-kilang pemprosesan. Pelaksanaan projek ini dijangka akan merealisasikan penjimatan tahunan yang nyataapabila ia selesai pada tahun 2013 nanti.

Pada tahun ini, kami telah berjaya melancar semula produk-produk kami di Indonesia selepas memperolehinombor-nombor ML yang baru dari pihak berkuasa Indonesia. Jualan di Indonesia amat menggalakkandan kami dapat melihat potensi yang besar dalam meningkatkan jenama kami dan juga rangkaianpengedarannya.

Tanggungjawab KorPoraT

Yeos mengiktiraf tanggungjawab korporat merupakan sebahagian penting dalam urusniaganya bagimewujudkan nilai mampan bagi semua pemegang berkepentingan, termasuk pengguna-pengguna,

pemegang saham dan juga warga pekerja.

Yeos telah melancarkan satu pertandingan kitar semula, satu platform bagi sekolah-sekolah untuk mendidikdan memupuk kesedaran di kalangan generasi muda mengenai kepentingan kitar semula dan pada masayang sama, menegaskan lagi kepentingan hidup sihat melalui pemahaman yang mendalam tentang nutrisimakanan.

Didorong oleh kesungguhan 60 buah sekolah rendah dalam Kempen Program Susu Soya Sekolah Yeosyang diadakan pada tahun 2010, kami telah melanjutkan kempen ini dengan penambahan 100 buah sekolahrendah di sekitar daerah Lembah Klang dengan menyampaikan ceramah pendidikan tentang pengamalanpemakanan yang seimbang dan seterusnya mengedarkan pek minuman Susu Soya Yeos kepada semuamurid yang terlibat dari bulan April ke Julai 2011.

Dalam Laporan Tahunan ini, kami juga memaparkan inisiatif-inisiatif tanggungjawab korporat yangdilaksanakan oleh Syarikat sepanjang tahun ini dalam aktiviti masyarakat dan pemeliharaan persekitarandengan lebih terperinci.

STraTegi dan ProSPeK MaSa HadaPan

Peningkatan prestasi tahun ini menyakinkan kami untuk mengorak langkah ke arah tahun 2012 dan LembagaPengarah tetap optimistik meskipun menghadapi cabaran ekonomi global. Kami akan kekal menumpukandan memasarkan produk teras kami dalam tahun kewangan baru ini di samping membina kemahiran dankeupayaan untuk masa depan. Kami amat positif terhadap prospek masa depan dan dalam jangka masa3 tahun, kami merancang untuk melabur RM190 juta bagi pembinaan kilang dan teknologi-teknologi yangbaru dan meningkatkan taraf kemudahan bagi menyediakan kami untuk pertumbuhan pada masa akandatang.

PengHargaan dan PengaKuan

Bagi pihak Lembaga, izinkan saya merakamkan setinggi-tinggi penghargaan ikhlas dan ucapan terimakasih kepada pihak pengurusan dan kakitangan atas usaha gigih, komitmen dan dedikasi dalam mencapaiprestasi yang baik.

Penghargaan saya juga ditujukan kepada para pelanggan kami, rakan-rakan perniagaan, rakan kongsi, danpemegang-pemegang saham atas sokongan berterusan mereka terhadap Yeos. Bagi rakan-rakan Pengarahseperjuangan saya, saya ingin mengucapkan jutaan terima kasih atas sokongan teguh dan bimbingan andasemua sepanjang tahun ini.

Kekal Sihat Sentiasa dan Hidup Riang Dan Ceria Bersama Yeos !

Kh b H

Ps


16/134


Yeo Hiap Seng (Malaysia) Berhad (Yeos or the Company), as a sociallyresponsible company, has integrated its corporate responsibility into a

sustainable business model that goes beyond shareholders interests, for

the betterment of society. It reects our commitments to our customers,

employees, investors, suppliers and the community.

COMMUNITIES

Yeos Program Susu Soya Sekolah 2

In 2010, the Company initiated a corporate

responsibility campaign, Yeos Program SusuSoya Sekolah which received positive feedbacks

from the public on its educational and nourishingvalues to the young. In continuing this initiative, the

Company embarked on Yeos Program Susu SoyaSekolah 2 to cover another 100 schools and reach

out to another 50,000 students with an aim to instillthe importance of a balanced diet and in educatingthe students on preserving the environment through

recycling.

Corporate Responsibility Statement

Yeos Scholarship Programme

Backed by the spirit of enthusiasm and perseverance,

students from 51 primary schools in the Klang

Valley and Putrajaya took part in the Yeos ProgramTajaan Biasiswa Sekolah. The students battledfor the scholarship through collection of Yeoslogo from empty beverage packs. Through this

programme, Yeos achieved its primary objective insetting a platform for students to exercise creativity

and problem solving skills. This programme alsoaimed to promote the spirit of esprit de corps

amongst students and teachers to work towardsachieving the school category scholarship for school

development fund.

1Malaysia Creative Sculpture Recycling

Competition

In support of the 1Malaysia philosophy, Yeosembarked on its green and remarkable 1Malaysia

recycled sculpture competition among allparticipating schools of Yeos Program Susu Soya

Sekolah using Yeos recyclable materials. Theultimate objective of this competition is to encourage

creativity and nurture recycling mindset amongstthe young. In recognition of the effort shown in this

recycling competition, Yeos awarded the winningschools each with school development fund to

support the development and extra-educationalactivities at school level.


17/134


My Ne Village Carnival

For the 3rd consecutive year, Yeos joined hands withNanyang Siang Pau in My New Village Carnivalto reach out to smaller communities and villages.Besides organising interactive activities with villagers,the Company contributed part of its sales generatedfrom the carnival to the schools in those villages insupport of their infrastructural and facilities buildingfund. This year, we also embarked on EmbellishYour Village with Yeos in which the participatingvillages collected, cleaned, and recycled Yeos

recyclable materials to embellish a selected spotin the villages and Yeos also shared knowledge ofcreative recycling through fun and interactive games.

Dynamic Dance Competition

In line with Lead a Joyful Life campaign, Yeosin collaboration with China Press, organised anational dynamic dance competition with the mainobjective to encourage communities to live and leada healthier and joyful lifestyle.

Support of world Vision Malaysia Movement

Yeos continued to support 30-Hour Famine programthrough its sponsorship of soy milk to individualcamps to raise fund for World Vision Malaysiasmovement in aid of those who are suffering frompoverty and hunger, giving them the opportunityfor improved health, better quality life, and mostimportantly, hope.

Factory Educational Visits

Yeos continues its initiative to welcome local andoverseas colleges and universities to enhancestudents knowledge on food and beveragemanufacturing processes.

wORKPLACE

Yeos recognises that employees are the driversof business performance. The Companys human

resources policies aim to enhance the performance

of staff through staff recognition schemes, offeringequal opportunities, training and development, andcreating sound employees relations.

Every year, in recognition of the loyal, dedicated and

committed employees, the Company honoured andrewarded the long service employees at its Annual

Dinner and Dance.

Corporate Responsibility Statement (continued)


18/134


Continue to Build Human Capital

Yeos continues to aggressively provide a supportive

working culture through training and developmentprogrammes. During the year, employees

participated in various in-house and external trainingprogrammes from technical-related skills to soft

management skills. To nurture the future workforceof our industry, we continue to open our doors to

interns for short-term attachment to complete theirdegree requirements.

Committed to Hazard Free Zone

Yeos is committed to providing a safe, healthy,

secure and conducive workplace for all itsemployees, visitors and business stakeholders. Our

commitments to the effective implementation ofOccupational Safety and Health Policy has achieved

a hazard-free work zone. Various communicationsactivities and campaigns were organised to ensure

the employees awareness to safety precautions.

ENVIRONMENT

Reusable Resources

Yeos is committed and passionate aboutenvironmental conservation. Yeos is the rst

food and beverage company to introduce its AsianDrinks products in Tetra Pak packaging which is

environmental friendly and recyclable.

Moving Toards Paper-less

Several programmes were introduced to upgrade ITinfrastructure to encourage paper-less environment

through electronic communications and e-ling

system. This effort has further been enhancedwith the introduction and implementation of theDistributor Management System (DMS).

MARKETPLACE

Yeos continues its efforts to rigorously adhere to

responsible business practices when engagingwith its stakeholders particularly its consumers,

suppliers and investors so as to provide clearerunderstanding of Yeos performance and enhance

their experience with us.

Commitment to Maintain the Highest Halal

Standard Compliance

Strict halal compliance is a vital component in

the continued success and an integral part of theCompanys DNA. Our ingredients, employees, and

systems constantly meet the most rigorous of halalstandards and our halal compliance is something

we are honoured to offer to our consumers.

Interaction ith Investor

We engage in constant dialogue with our investors

and shareholders through Annual General Meeting(AGMs) and meetings. Our AGMs are the primary

platform for direct two ways interaction between theBoard of the Company and shareholders. We keep

investors updated on the Companys performanceand key business activities including quarterly

nancial announcements which are made availablethrough our website.

Corporate Responsibility Statement (continued)


19/13417Annual Report 2011

Statement on Corporate Governance

The Board of Directors is fully committed to the principles of corporate governance and best practices asembodied in the Malaysian Code on Corporate Governance (the Code). The Board takes every step toensure that the highest standards of corporate governance are practised throughout the Group in order to

protect and enhance shareholders value and the nancial performance of the Group. The Board is pleasedto provide the following which outlines the corporate governance practices that were in place throughout the

nancial year.

THE BOARD OF DIRECTORS

Composition and Board Balance

The Board currently has nine members, comprising two Executive Directors and seven Non-ExecutiveDirectors. Of the seven Non-Executive Directors, four are independent, satisfying the requirement of the

Code for Independent Non-Executive Directors to make up at least one-third of the Board membership.

The role of the Chairman is separate from that of the Chief Executive Ofcer. The Chairman is responsible

for leadership of the Board and monitoring its effectiveness. He facilitates both the contribution of the Non-Executive Directors and constructive relations between the Executive and Non-Executive Directors. The

Chief Executive Ofcer is responsible for managing the Groups business, including the formulation andimplementation of major strategies and initiatives adopted by the Board.

The Directors are from diverse professional background with a wide range of expertise, bringing with them

an independent judgment and considerable knowledge to the Board. They advise management on strategydevelopment and ensure that the Board maintains high standards of nancial and other reporting compliance

as well as providing adequate checks and balances for safeguarding the interests of shareholders and theGroup as a whole. Where a potential conict of interest may arise, it is mandatory practice for the Director

concerned to declare his interest and abstain from the decision-making process.

A brief prole of each Director is set out on pages 4 to 8 of this Annual Report.

Board Attendance

The Board meets at least once every quarter on a scheduled basis and additional meetings will be convenedas and when required. Board meetings for the following nancial year are scheduled before the end of the

current nancial year to allow the Directors to plan their appointments ahead and as such to facilitate fullattendance at the Board meetings.

During the year, ve (5) Board Meetings were held and the Directors attended the following number ofmeetings:

Name of Directors Attendance

Koh Boon Hwee 5/5

Tjong Yik Min 5/5

Dato Mohamed Nizam bin Abdul Razak 5/5

Dato N. Sadasivan a/l N.N. Pillay 5/5

Razman Hadz bin Abu Zarim 5/5

Chandra Das s/o Rajagopal Sitaram (Appointed on 26 April 2011) 3/3

Ow Tin Nyap 5/5

Yap Ng Seng 5/5

Pearl Foong Lye Fong 5/5


20/13418 Yeo Hiap Seng (Malaysia) Berhad (3405-X)

Statement on Corporate Governance (continued)

Supply of Information

The Directors have full and unrestricted access to all information pertaining to the Groups business andaffairs to enable them to discharge their duties. All Directors are provided with reports and other relevantinformation on a timely manner, covering various aspects of the Groups operations and performance. Theyare also provided with an agenda and a set of board papers pertaining to agenda items prior to Boardmeetings for consideration and where appropriate, for decision. In addition, the Board has access to theadvice and services of the Company Secretary and senior management. The Company Secretary attends allBoard meetings and ensures that accurate records of the proceedings of the Board meetings and decisionsmade are properly recorded. Senior management ofcers may be invited to attend Board meetings whennecessary to provide the Board with clarications and comments on the relevant agendas tabled at theBoard meetings. The Board may seek independent professional advice from external consultants at the

Companys expense, if required, in furtherance of their duties.

Board Committees

The Board currently has four Committees, the majority members of which comprise Independent Non-Executive Directors. The Board delegated certain responsibilities to these four Board committees whichoperate within clearly dened terms of reference as set out below. The Board Committees evaluate mattersand report to the Board their ndings and recommendations thereon. The responsibility for the nal decisionon all matters discussed and recommended by the Board Committees, however, lies with the Board.

a) Audit Committee

The Audit Committee (AC) reviews issues of accounting policies and presentation for external nancial

reporting, monitors the work of the internal audit function and ensures an objective and professionalrelationship is maintained with the external auditors. The AC has full access to both the internal andexternal auditors who, in turn, have access at all times to the Chairman of the AC.

The composition and terms of reference of the AC may be found on pages 27 to 30.

b) Nomination Committee

The Nomination Committee (NC) recommends the appointment of Directors to the Board. The termsof reference of the NC adopted by the Board are as follows:

To recommend appropriate candidates to the Board. To determine annually whether or not a Director is independent. To decide whether or not a Director is able and has been adequately carrying out his/her duties

based on the following criteria:- Attendance- Preparedness- Participation

To evaluate and propose objective performance criteria for the Board. Performance criteria thatmay be used include return on assets (ROA), return on equity (ROE), economic value added (EVA),return on sales, return on investment, etc.

To review the Boards required mix of skills and experience and other qualities that the Directorsshould bring to the Board.

The members of the NC as at the date of this statement are as follows:

Razman Hadz bin Abu Zarim (Chairman) - Non-Executive / Independent Dato N. Sadasivan a/l N.N. Pillay - Non-Executive / Independent Tjong Yik Min - Executive / Non-Independent




c) Remuneration Committee

The Remuneration Committee (RC) reviews and recommends remuneration framework for Executive

Directors. The terms of reference of the RC are as follows:

Made up of Non-Executive Directors, the majority of whom are independent of management and

free from any business or other relationship, which may materially interfere with the exercise oftheir independent judgment. This ensures transparency in the development of the remuneration

framework and minimises the risk of any potential conict of interest. Chaired by an Independent Non-Executive Director.

RCs recommendations are made in consultation with the Chairman of the Board and submittedfor endorsement by the entire Board.

RC recommends to the Board a framework of remuneration for the Board and key executives anddetermines specic remuneration packages for each Executive Director and the CEO if the CEO is

not an Executive Director. The determination of remuneration packages of Non-Executive Directors is the matter of the

Board and individuals concerned should abstain from discussion of their own remuneration. No Director should be involved in deciding his own remuneration.

The RC covers all aspects of remuneration, including but not limited to Directors fees, salaries,allowances, bonuses, options and benets-in-kind.

The RC comprises the following members:

Dato N. Sadasivan a/l N.N. Pillay (Chairman) - Non-Executive / Independent

Dato Mohamed Nizam bin Abdul Razak - Non-Executive / IndependentChandra Das s/o Rajagpoal Sitaram - Non-Executive / Independent

d) Investment Committee

The term of reference of the Investment Committee (IC) is to manage the Companys portfolio ofsecurities, reviewing and evaluating proposals for joint ventures, mergers and acquisitions.

The IC comprises the following members:

Dato Mohamed Nizam bin Abdul Razak (Chairman) - Non-Executive / Independent Dato N. Sadasivan a/l N.N. Pillay - Non-Executive / Independent

Razman Hadz bin Abu Zarim - Non-Executive / Independent Tjong Yik Min - Executive / Non-Independent

Appointments and Re-Election

Procedures relating to the appointment and re-election of Directors are set out in the Companys Articlesof Association. All newly appointed Directors will be subject to retirement and re-election by shareholders

at the rst Annual General Meeting (AGM) subsequent to their appointment. In addition, one-third (or thenumber nearest to one-third) of the remaining Directors, including the Chief Executive Ofcer, shall retire

from ofce and be eligible for re-election at each subsequent AGM, provided always, all Directors, includingthe Chief Executive Ofcer, shall retire from ofce once at least in every three years but shall be eligible for

re-election.

The NC recommends candidate for directorship to be lled by the shareholders or the Board. In making itsrecommendations, the NC will focus on the skills and personal qualities of the candidate as well as businessexperience the candidate possess to enhance the Boards decision making and management of the business

and affairs of the Company.



Appointments and Re-Election (continued)

The NC carries out an annual assessment and evaluation on the effectiveness of the Board as a whole and

the contribution of each of the individual Directors, including Independent Non-Executive Directors, as wellas the Chief Executive Ofcer. All assessments carried out by the NC are documented.

Pursuant to Section 129(2) of the Companies Act, 1965, all Directors who are over seventy years of age are

required to submit for re-appointment annually.

The NC also recommends the re-appointment and re-election of Directors who are seeking for re-appointmentand re-election at the AGM. The Directors who are standing for re-appointment and re-election at the Thirty-

Eighth AGM of the Company to be held on 25 April 2012 are contained in the Notice of AGM.

Directors Training Programme

Given the fact that Directors roles are increasingly demanding in an organisation, the Board of Directorscontinues to equip and update themselves with the relevant programmes, technologies and current

developments in the industry as well as with the new regulatory and statutory requirements. All members ofthe Board have also attended the Mandatory Accreditation Training Programme (MAP) prescribed by Bursa

Malaysia Securities Berhad, including Mr Chandra Das s/o Rajagopal Sitaram who was appointed to theBoard on 26 April 2011.

Except those Directors who were not able to attend any training during the year due to tight work schedule,

the following Directors had attended the following conferences, forums, seminars and training programmesduring the nancial year.

Name ofDirectors

Training Programme

Dato N.Sadasivan a/lN.N. Pillay

Corporate Governance and Boardroom Issues in Challenging Times on 18 February2011

Sustainability Programme for Corporate Malaysia on Trading Services and IndustrialProducts on 23 March 2011

Razman Hadzbin Abu Zarim

Government Financial Assistance for SMEs on 6 December 2011 New Corporate Governance Blueprint & Regulatory Updates on 14 December 2011

Ow Tin Nyap Far East Organization Leadership Talk Series on 18 February 2011 Far East Organization Leadership Talk Series on 25 March 2011 Far East Organization Leadership Talk Series on 29 June 2011 FEO Management Workshop 2011 : Do Good Business held in Shanghai on 18-22 October

2011 Far East Organization Leadership Talk Series on 22 November 2011

Pearl FoongLye Fong

Doing Deals in Vietnam on 19 January 2011 New Challenges and Priorities for CFOs on 12 October 2011 Global Transfer Pricing Conference 2011 Sustainable Transfer Pricing in an Era of

Growth and Business Transformation on 19-21 October 2011




Directors Remuneration

The RC is responsible for reviewing and recommending the policy framework on the remuneration of the

Executive Directors with the aim to attract, motivate and retain Directors of the right caliber needed torun the Company successfully. The determination of the remuneration of the Non-Executive Directors is a

matter for the Board as a whole. Directors do not participate in decisions regarding their own remunerationpackage. Directors fees are subject to shareholders approval at the AGM.

The Independent Non-Executive Directors are paid attendance allowances for Board and Audit Committee

meetings that they attended as well as allowances for serving as a Board Committee member.

For the year ended 31 December 2011, the aggregate remuneration of the Directors are as follows:

Directors Fees(RM)

Salaries(RM)

Bonuses(RM)

OtherEmoluments

(RM)Total(RM)

Executive - 963,201 272,268 329,308 1,564,777

Non-Executive 128,972 - - 206,667 335,639

128,972 963,201 272,268 535,975 1,900,416

The number of Directors whose total remuneration fall within the following bands are as follows:

Number of Directors

Range of Remuneration Executive Non-Executive

Nil - 3

RM1 to RM50,000 - 1

RM50,001 to RM100,000 - 2

RM100,001 to RM150,000 - 1

RM600,001 to RM650,000 1 -

RM900,001 to RM950,000 1 -

RELATIONSHIP WITH SHAREHOLDERS

Investors Relations and Shareholders Communication

The Group recognises the importance of establishing a direct line of communication with shareholders andinvestors through timely and thorough dissemination of information on the Groups performance and major

developments via appropriate channels of communication.

Dissemination of information includes the distribution of the Annual Report and relevant circulars, issuanceof press releases inclusive of quarterly nancial performance of the Group to Bursa Malaysia Securities

Berhad (Bursa Securities) and the public as well as press conferences.




Investors Relations and Shareholders Communication (continued)

In order to maintain a high level of transparency and to promote wider dissemination of corporate andnancial disclosures, all information that is made to the public, is available on the Companys website, www.

yeos.com.my. Alternatively, shareholders and the public may access to our Customer Care toll free line at1300-80-2828 for more information on the Company. All announcements released to the Bursa Securities

are available on Bursa Securities website at www.bursamalaysia.com.

Annual General Meeting

The Chairman and the Board encourage shareholders to attend and participate in the AGM held annually.

The AGM is the principal forum for dialogue and interaction with individual shareholders and investors wherethey may seek clarications and comments on the Groups businesses and nancial performance from the

Board as well as the senior management.

ACCOUNTABILITY AND AUDIT

Financial Reporting

In addition to providing the nancial report on an annual basis, the Company also presents the Groupsnancial results on a quarterly basis via public announcements. The Directors ensure the integrity of

nancial information and the effectiveness of the nancial controls, internal control and risk managementsystems. The AC assists the Board in reviewing the information disclosed to ensure accuracy, adequacy and

completeness of all annual and quarterly reports, audited or unaudited, and approved by the Board beforereleasing to Bursa Securities.

The Directors are also responsible for ensuring that all nancial statements are prepared in accordancewith the provisions of the Companies Act, 1965 and Malaysian Accounting Standards Board (MASB), the

Approved Accounting Standards in Malaysia for entities other than private entities.

A statement by Directors of their responsibility in preparing the nancial statements is set out on page 30 ofthis Annual Report.

Internal Control

The Board recognises the importance of a sound system of internal control and acknowledges its ultimate

responsibility in maintaining the same, which includes the establishment of an appropriate control environmentand framework as well as reviewing its adequacy and integrity. The internal control system covers all levels

of personnel and business processes and is designed to safeguard the Companys assets and shareholdersinterest. The Board is satised with the design of the existing internal control system, which would continue

to be improved, reviewed and updated in line with changes in the operating environment.

Information of the Groups internal control is presented in the Statement on Internal Control set out on pages25 to 26 of this Annual Report.




Internal Audit Function

During the year under review, the internal audit team performed regular review of the effectiveness of therisk management, internal control, and governance processes within the Group. Their responsibilities are

as follows:

Evaluate the relevance, reliability and integrity of nancial and management information; Review systems and operations to assess the extent to which company objectives are achieved and the

adequacy of control activities leading to such achievement; Appraise utilisation of resources with regard to economy, efciency and effectiveness;

Assess the means of safeguarding assets and verify their existence; Ascertain the extent of compliance with established policies, procedures, plans, laws and regulations.

Internal auditors also perform ad hoc appraisals, inspections, investigations, examinations, reviewsrequested by the AC or senior management, as appropriate.

The internal audit team reports directly to the AC of their ndings, the AC in turn will review their ndingswith management on quarterly basis. The internal audit team will subsequently follow-up to determine the

extent of their recommendations that have been implemented. As such, the internal audit function providesassurance to the Board on the Groups system of internal control.

Relationship with External Auditors

Messrs. PricewaterhouseCoopers is the Companys external auditors. The Board, through the establishmentof the AC, maintains a formal and transparent arrangement with the external auditors.

The roles of the AC in relation to the external auditors is described in the Audit Committee Report on pages27 to 30 of this Annual Report.

ADDITIONAL COMPLIANCE INFORMATION

Share Buy-Back

The Company had at its Thirty-Seventh AGM held on 26 April 2011 obtained the approval of the shareholders

in relation to the Share Buy-Back authority, whereby the Directors are authorised to purchase and/or holdat any point of time up to ten per cent (10%) of the issued and paid-up share capital of the Company for the

time being quoted on Bursa Securities.

For the nancial year ended 31 December 2011, the Company purchased a total of 2,000 shares, all of whichare retained as treasury shares. None of the shares purchased has been sold or cancelled. Details of the

shares bought back are set out below:

DateNo. of

Ordinary SharesMinimumprice paid

(RM)

Maximumprice paid

(RM)

Averageprice paid *

(RM)Consideration *

(RM)

29.04.2011 1,000 1.69 1.69 1.733 1,732.51

09.11.2011 1,000 1.78 1.78 1.823 1,822.54

* Inclusive of transaction costs

As at the date of this statement, the total number of shares purchased by the Company is 845,900 shares andthese shares are presently held as treasury shares.




Recurrent Related Party Transactions

The Company had also at the Thirty-Seventh AGM obtained the shareholders mandate to enter into recurrent

related party transactions of a revenue nature, which are necessary for the day-to-day operations on theterms not more favorable to the related party than those available to the public and not to the detriment of

the minority shareholders.

Breakdown of the aggregate value and type of recurrent related party transactions conducted pursuant tothe shareholders mandate for the nancial year ended 31 December 2011 is set out below:

Related Parties Nature of Transactions

Interested Directors/Major Shareholders/

Person ConnectedAggregate Value

(RM)

YHS (Singapore)Pte. Ltd.

(YHSPL), a majorshareholder of

the Company withdirect interest of

61.147% as at 15March 2012

Purchase of nishedgoods by Yeo Hiap

Seng Trading Sdn Bhd(YHST), a wholly-owned

subsidiary of Yeo HiapSeng (Malaysia) Berhad

(YHSM)

(i)

(ii)

(iii)

(iv)

(v)

(vi)

Yeo Hiap Seng Limited (YHSL),the penultimate holding companyof the Company through its 100%shareholding in YHSPL

Koh Boon Hwee, a commondirector of YHSL and YHSM

Tjong Yik Min, a common directorof YHSL, YHSPL and YHSM

Ow Tin Nyap, a common director ofYHSL and YHSM

Yap Ng Seng, a common director ofYHSL, YHSPL and YHSM

Pearl Foong Lye Fong, GroupFinancial Controller of YHSL andcommon director of YHSM and YHST

3,226,336.68

Material Contracts

During the nancial year, there were no material contracts entered into by the Company and its subsidiarycompanies which involve Directors and major shareholders interests.

Non-Audit Fees

The details of the non-audit fees paid/payable to the external auditors, PricewaterhouseCoopers for the

nancial year ended 31 December 2011 are set out below:

RM

Review of Interim Financial Information for Quarter 2 of 2011 and other services 40,818.00

This Statement on Corporate Governance is made in accordance with the resolution of the Board of Directorsdated 15 March 2012.




Statement on Internal Control

The Board of Directors recognises the importance of a sound system of internal control which consists interalia, risk management, nancial organisational, operational and compliance control to meet the Groupsbusiness objectives, safeguard shareholders investments, the interest of customers, regulators, employees

and the Groups assets. The Groups system of internal control involves all management and personnel fromeach business unit. The Board afrms its overall responsibility for the Groups system of internal control

in determining key strategies and policies for signicant risks and control issues, while management ofthe Group is responsible for the effective implementation of the Boards policies by designing, operating,

monitoring and managing risks and control processes.

For the nancial year ended 31 December 2011, management of the Group continued to assist the Board in

the implementation of the Boards policies and procedures in maintaining a sound system of internal controland risk management. The Audit Committee (AC) and internal auditors continued to provide independent,

objective assurance and consulting services designed to add value and improve the Groups operations. Theinternal auditors help the Group accomplish its objectives by bringing a systematic, disciplined approach in

evaluating and improving the effectiveness of risk management, controls and governance processes.

The Board of Directors is pleased to provide the following statement on the state of internal control of theGroup in accordance with Statement on Internal Control : Guidance for Directors of Public Listed Companiesfor the nancial year ended 31 December 2011.

Internal Control

The Board recognises the importance of a sound system of internal control and acknowledges its ultimateresponsibilities in maintaining the same, which includes the establishment of an appropriate control

environment and risk management framework as well as reviewing, monitoring and ensuring its adequacyand integrity. The Group has a system of internal control designed to address the following areas, in order

to achieve its strategic goals and business objectives, whilst safeguarding its assets and shareholdersinterests:

(i) Governance(ii) Regulations Compliance

(iii) Efcient and Effective Operations(iv) Assets Protection and Safeguarding

(v) Timely and Accurate Reporting

The nature of risks means that events may occur which would give rise to unanticipated or unavoidable

losses and because of the limitations that are inherent in any system of internal control, the Board recognisesthat such system of internal control are designed to manage and control, rather than eliminate the risk offailure to achieve its business objectives. Accordingly, it should be noted that the system of internal control

could therefore only provide reasonable and not absolute assurance against the risk of material errors,misstatement, fraud or losses.

The Groups system of internal control comprises the following key elements:

Board Committees

Clear denitions of functions and responsibilities of the various committees of the Board of Directors.

Control Procedures

Well established policies, procedures and practices are in place to ensure clear accountability and

control procedures for all business units. These policies and procedures are available and accessibleby all employees.



Organisational Structure and Accountability Levels The Group has a well-dened organisational structure with clear lines of accountability. The delegation

of authority is properly documented and sets out the decisions that need to be taken and the appropriateauthority levels of management, including matters that require Board approval.

Information System

The Group maintains a comprehensive information system which enables transactions to be captured,compiled and reported in an organised manner. The SAP IT system provides management with exception

reports to identify risk areas for appropriate remedial action.

Reporting and Review

There is a strategic planning, annual budgeting and target setting process formulated by managementteam, which comprises the Chief Executive Ofcer, the Deputy Chief Executive Ofcer, the ChiefOperating Ofcer and senior management ofcers (known as the Matrix).

Actual sales performance compared to budget is reported to the Matrix on a daily basis and the Matrix

carries out regular meetings to review nancial results and forecasts for all business units within theGroup, including actual performance against operating plans and annual budgets. The Matrix also

reviews and monitors operational, nancial performance and considers business developments as wellas formulating action plans to address any areas of concern. In addition, quarterly business reviewsand nancial results are prepared and tabled at the Board meetings for review.

Internal Audit and Audit Committee

The internal auditors perform regular examination and evaluation of the adequacy and effectivenessof the Companys governance, system of internal control structure and the quality of managements

performance in carrying out assigned responsibilities to achieve the Companys goals and objectives.The internal auditors reports directly to the AC of their ndings, the AC in turn will review their ndings

with management on quarterly basis. The internal auditors will subsequently follow-up to determinethe extent to which their recommendations have been implemented. As such, the internal auditors

provide assurance to the Board on the effectiveness of the Groups system of internal control.

The AC reports to the Board of Directors on the activities of the internal auditors, signicant ndingsand the necessary recommendations in relation to the adequacy and effectiveness of the system of

internal control and accounting control procedures of the Group.

Risk Management

The Groups operations involve the management of a wide range of risks. A Risk Management Committee

comprising key management team has been set up and is responsible for identifying business risks andin ensuring the implementation of appropriate systems to manage these risks. The Risk Management

Committee which is led by the Deputy Chief Executive Ofcer meets regularly to discuss, review andmonitor strategic and operational matters and reports their ndings and action plans to the Board on

quarterly basis.

Conclusion

The Board is of the view that there is a continuous process in evaluating and managing signicant risksfaced by the Group. Because of the changing circumstances and conditions, the effectiveness of an internal

control system may vary over time. The Board and management will continually evaluate and take measuresto strengthen the internal control environment.

This Statement on Internal Control is made in accordance with the resolution of the Board of Directors dated15 March 2012.

Statement on Internal Control (continued)



Audit Committee Report

Composition and Meetings

The Audit Committee comprises the following four (4) members, three (3) of whom, including the Chairman,are Independent Non-Executive Directors.

During the year, ve (5) Audit Committee meetings were held and the members attended all the meetings.

Name Status of Directorship Attendance

Dato Mohamed Nizam bin Abdul Razak (Chairman) Independent Non-Executive Director 5/5

Dato N. Sadasivan a/l N.N. Pillay Independent Non-Executive Director 5/5

Razman Hadz bin Abu Zarim Independent Non-Executive Director 5/5

Pearl Foong Lye Fong Non-Independent Non-ExecutiveDirector

5/5

The following terms of reference were reviewed and approved by the Board of Directors on 15 March 2012.

Terms of Reference:

1. Terms of Membership

An independent Audit Committee exists to implement and support the functions of the Board. TheAudit Committee is appointed by the Board of Directors from among the Directors of the Company andconsists of at least three members, all of whom must be non-executive directors. The majority of themembers must be independent directors and at least one member of the committee;

a. must be a member of the Malaysian Institute of Accountants (MIA); or

b. has at least three years working experience andi. has passed the examinations specied in Part I of the First Schedule of the Accountants Act

1967; orii. is a member of one of the associations of accountants specied in Part II of the First Schedule

of the Accountants Act 1967; or

c. fullls such other requirements as prescribed or approved by Bursa Malaysia Securities Berhad.

No Alternate Director has been appointed as a member of the Audit Committee. The Chairman ofthe Audit Committee is elected among the members and is an Independent Non-Executive Director.If a member of the Audit Committee resigns, dies or for any reason ceases to be a member with the

result that the number of members is reduced to below three, the Board of Directors shall, withinthree months of that event, appoint such number of new members as may be required to make up theminimum number of three members.

The terms of ofce and performance of the Audit Committee shall be reviewed by the Board of Directorsat least once in every three years to determine whether the Audit Committee and members have carriedout their duties in accordance with their terms of reference.

2. Objectives

The primary objectives of the Audit Committee are:

a. To assist the Board in discharging its responsibilities relating to the Groups and the Companysmanagement of principal risks, internal controls, nancial reporting and compliance of statutoryand legal requirements.

b. To maintain through regularly scheduled meetings, a line of communication between the Board ofDirectors, senior management, internal auditors and external auditors.



3. Duties and Responsibilities

The duties and responsibilities of the Audit Committee shall be:

With the External Auditors:

a. To review their audit plans;

b. To review their evaluation of the system of internal control;

c. To review their audit reports;

d. To consider the nomination of a person or persons as auditors;

e. To review any letter of resignation from the external auditors of the Company; and

f. To review the assistance given by the employees of the Company to the external auditors.

With the Internal Auditors:

a. To review the adequacy of the scope, functions, competency and resources of the internal auditfunctions and that it has the necessary authority to carry out its work; and

b. To review the internal audit programme, processes, the results of the internal audit programme,processes or investigations undertaken and whether or not appropriate actions are taken on the

recommendations of the internal audit function.

On Financial Reporting:

To review the quarterly results and year-end nancial statements, prior to the approval by the Board of

Directors, focusing particularly on:

i. Changes in or implementation of major accounting policies and practices;ii. Signicant and unusual events;

iii. Signicant adjustments arising from the audit;iv. The going concern assumption; and

v. Compliance with accounting standards and other legal requirements.

On Related Party Transactions:

Any related party transactions that may arise within the Company or the Group.

Other matters:

To review such other functions as may be agreed by the Audit Committee and the Board of Directors.

4. Authority

The Audit Committee shall:

a. Have authority to investigate any matter within its terms of reference;

b. Have the resources which are required to perform its duties;

c. Have full and unrestricted access to any information pertaining to the Company and the Group;

Audit Committee Report (continued)




4. Authority (continued)

d. Have direct communication channels with the external auditors, internal auditors and person(s)carrying out the internal function or activity;

e. Be able to obtain external professional advice; and

f. Be able to convene meetings with the external auditors, internal auditors or both.

5. Activities of the Audit Committee

In line with the terms of reference, the Audit Committee during the year ended 31 December 2011:

a. reviewed the audit plans of the Company and the Group for the year which were prepared by boththe external and internal auditors;

b. reviewed the audit reports for the Company and the Group prepared by the external and internalauditors, the major ndings by the auditors and the managements responses thereto;

c. reviewed the quarterly and annual reports of the Company and the Group and thereafter submittingthem to the Board for consideration and approval;

d. reviewed the ndings of investigations conducted during the year and the managements responsesthereto;

e. reviewed the related party transactions; and

f. considered and recommended to the Board for approval of the audit fees payable to the externaland internal auditors.

6. Internal Audit Function and its Activities

The internal audit function was performed by a professional rm, Deloitte Enterprise Risk Services SdnBhd and the internal auditors reports directly to the Audit Committee, assisting the Audit Committee indischarge its duties and responsibility. The costs incurred for the internal audit function in respect ofthe nancial year ended 31 December 2011 was RM198,109.25.

The internal audit provides independent, objective assurance and consulting services designed toadd value and improve the Companys operations. Internal audit helps the Company accomplish itsobjectives by bringing a systematic, disciplined approach to evaluating and improving the effectivenessof risk management, controls and governance processes.

The scope of internal audit encompasses the examination and evaluation of the adequacy andeffectiveness of the Company governance, system of internal control structure, and the quality ofperformance in carrying out assigned responsibilities to achieve the Companys stated goals andobjectives.

It includes: Evaluate the relevance, reliability and integrity of nancial and management information; Review systems and operations to assess the extent to which company objectives are achieved

and the adequacy of control activities leading to such achievement; Appraise utilisation of resources with regard to economy, efciency and effectiveness;

Assess the means of safeguarding assets and verify their existence; Ascertain the extent of compliance with established policies, procedures, plans, laws andregulations.




6. Internal Audit Function and its Activities (continued)

Internal auditors also perform ad hoc appraisals, inspections, investigations, examinations, reviewsrequested by the Audit Committee or senior management, as appropriate.

7. Meetings and Minutes

a. Audit Committee meetings are held not fewer than four times a year. Internal auditors and externalauditors may attend the meetings upon the invitation of the Audit Committee.

b. At least twice a year, the Audit Committee shall meet the external auditors without the presenceof any executive directors and management of the Company. There is a continuous engagement,both formal and informal, between the Chairman of the Audit Committee and the General Manager

of Finance of the Company, as well as the external auditors, in order for the Audit Committee to bekept informed of matters affecting the Company.

c. To form a quorum, a majority of members present must be independent directors.

d. Minutes of each meeting shall be kept and distributed to each member of the Audit Committee.

e. The Chairman of the Audit Committee shall report on each meeting to the Board.

f. The Secretary to the Audit Committee shall be the Company Secretary.

g. Detailed audit reports by the internal auditors and the respective management responses arecirculated to the members of the Audit Committee before each meeting at which the said reports

are tabled.

Directors Responsibilities Statement

The Directors are required by the Companies Act, 1965 (the Act) to prepare nancial statements for each

nancial year, which give a true and fair view of the state of affairs of the Group and of the Company at the

end of the nancial year and of the results and cash ows of the Group and the Company for the nancialyear then ended.

The Directors afrm that in preparing the nancial statements for the nancial year ended 31 December2011 set out on pages 41 to 115, the Group used certain critical accounting estimates and assumptions that

affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at thedate of the nancial statements, and the reported amounts of revenues and expenses during the reported

nancial year in accordance with the provision of Companies Act, 1965 and MASB Approved AccountingStandards in Malaysia for Entities Other than Private Entities. Although these estimates and judgment are

based on the Directors best knowledge of currents events and actions, actual results may differ as theDirectors exercised their judgment in the process of applying the Groups accounting policies.



Group Property Particulars

Listed below are the particulars of the properties referred to in Notes 14, 15, 19 and 21 to the Financial Statements.Location of

PropertyBrief

DescriptionApproximate

Land Area(sq. ft.)

Tenure Date ofAcquisition

ApproximateAge of

Building(years)*

Net BookValue as at31.12.2011(RM000)

Corporate Ofce and Factories

1. 7, Jalan Tandang,Petaling Jaya,Selangor

CorporateOfce, Factory

and TradingWarehouse

125,235 99 years leaseexpiring in year

2058

8.9.1977 52 1,902

2. Lots 191 & 121,

Shah AlamIndustrial Estate,Shah Alam

Factory and

TradingWarehouse

428,140 99 years lease

expiring in year2074 and 2073

respectively

5.11.1981

&27.12.1983

30 1,768

3. Lot 66134, Districtof Kinta, Perak

Factory andTrading

Warehouse


2033

9.1.1989 40

498


Factory andTrading

Warehouse


2048

30.11.1988 40


Factory andTrading

Warehouse


2033

11.4.1994 40

1,120


Factory andTrading

Warehouse


2048

12.1.1996 40

7. H.S. (M) 2458(formerly knownas Lot 1151-1154),Mukim of Plentong,Johor

Factory andTrading

Warehouse

298,769 Interest inperpetuitysubject to

payment ofannual rent

6.12.1990 41 6,404

8. Lot 2050 (formerlyknown as Lots1340-1346) Sec.66,

Kuching, Sarawak

Factory andTrading

Warehouse


2027

12.11.1984 26 238

Trading Warehouses

9. Lots 24, 29-31 MIELIndustrial EstatePrai

TradingWarehouse


2071

29.9.1972&

20.3.1978

34 300

10. Lot PT 645-650,Mukim Panchor,Daerah KemuminKota Bharu,Kelantan

TradingWarehouse


2048

3.11.1993 16 680

11. Lot 147A, Kawasan

PerindustrianSemambu, Kuantan,Pahang

Trading

Warehouse

209,611 66 years lease

expiring in year2046

4.11.1980 29 277

* The approximate age of building denotes the age of the oldest building.



Group Property Particulars (continued)

Location ofProperty

BriefDescription

ApproximateLand Area

(sq. ft.)

Tenure Date ofAcquisition

ApproximateAge of

Building(years)*

Net BookValue as at31.12.2011(RM000)

12. Lots K-70 &71, TemerluhIndustrial Park(Phase One)Mentakab

TradingWarehouse

43,560 Freehold Land 25.9.1995 15 709

13. Lot 1347, Sec.66,Kuching, Sarawak

TradingWarehouse

213,836 60 years leaseexpiring inyear 2027

7.9.1996 14

2,564

14. Lot 1348, Sec.66,Kuching, Sarawak

TradingWarehouse


7.9.1996 15

15. Lot 30, Block 19,SeduanLand District,Sibu, Sarawak

TradingWarehouse


4.4.1979 31 137

16. Lot 4183 (formerlyknown 1732-1750)Block 5, LambirLand District, Miri,Sarawak

TradingWarehouse


29.8.1994 16 1,306

17. Lot 71, SedcoIndustrial Estate,Kota Kinabalu,Sabah

TradingWarehouse


20.9.1990 20 529

Vacant Land

18. Mukim of Ulu Kintaand Sungei Raja,Perak

FarmingLands

11,288,138 17 lots freehold,3 lots with 60years lease


5.11.1985 37 624

19. Lot 6843 (PT 2987),

Mukim Bidor,Daerah BatangPadang, Perak

Industrial

Land

2,178,000 99 years lease


15.3.1996 -

6,300

20. PT 2988, MukimBidor, DaerahBatang Padang,Perak

IndustrialLand

2,093,930 99 years leaseexpiring in year

2094

29.6.1996 -

21. District of Kluang,Mukim SungaiBenut Johor

IndustrialLand

4,523,096 Interest inperpetuity

10.11.1994 - 9,048

22. Lot 1632, KemenaLand District,

Bintulu, Sarawak

IndustrialLand

60,084 60 years leaseexpiring in

year 2058

8.7.1998 - 347

34,751

* The approximate age of building denotes the age of the oldest building.

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FINANCIAL STATEMENTS

34 Directors Report

38 Statement by Directors

38 Statutory Declaration

39 Independent Auditors Report

41 Statements of Comprehensive Income

43 Statements of Financial Position

45 Consolidated Statement of Changes in Equity

47 Statement of Changes in Equity

49 Statements of Cash Flows

51 Notes to the Financial Statements



Directors Report

The Directors have pleasure in submitting their annual report together with the audited nancial statementsof the Group and the Company for the nancial year ended 31 December 2011.

PRINCIPAL ACTIVITIES

The Company is principally involved in the production, marketing and sale of beverage and food products.

The principal activities of the subsidiaries are shown in Note 16 to the nancial statements.

There have been no signicant changes in the nature of these activities of the Group and the Company duringthe nancial year.FINANCIAL RESULTS

Group Company

RM000 RM000

Prot for the nancial year 24,988 25,154

Attributable to:

Equity holders of the Company 24,983 25,154

Non-controlling interest 5 -

24,988 25,154

DIVIDENDS

The dividends on ordinary shares paid or declared by the Company since 31 December 2010 were as follows:

RM000

In respect of the nancial year ended 31 December 2010 as shownin the Directors report of that nancial year:

Final gross dividend of 9 sen per share, less income tax of 25%, paid on 8 July 2011 10,307

In respect of the nancial year ended 31 December 2011:

Interim gross dividend of 3 sen per share, less income tax of 25%, paid on 12 October 2011 3,436

13,743

The Directors now reco

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