ANNUAL REPORT 2014 - Latest Announcement Bursa Malaysia Securities Berhad ... as Internal Audit...

A N N U A L R E P O R T 2 0 1 4

CONTENTS2 Corporate Information3 Financial Highlights6 Board of Directors8 Directors’Profiles12 Management Team16 Chairman’s Message20 Managing Director’s Message22 Corporate Responsibility26 Statement on Corporate Governance34 Audit & Risk Management Committee Report36 Statement on Risk Management and Internal Control37 Nomination Committee Report38 Financial Statements123 Statistical Report127 Notice of Annual General Meeting • Proxy Form

TO BE THE LEADING AND PREFERRED OFFSHORE MARINE OPERATOR FOR THE UPSTREAM OIL & GAS INDUSTRY IN THE REGION.

GROUP VISION

Perdana Petroleum Berhad Annual Report 20142

CORPORATEINFORMATION

BOARD OF DIRECTORSRAJA ANUAR RAJA ABU HASSANIndependent Non-Executive Chairman

CAPT SURYA HIDAYATManaging Director

DATO’ KHO POH ENGExecutive Director

SHAMSUL SAADExecutive Director

SOON FOOK KIANExecutive Director

LEONG POOI WAHIndependent Non-Executive Director

WONG CHEE LINIndependent Non-Executive Director

DATO’ AMOS SIEW BOON YEONGIndependent Non-Executive Director(Appointed on 13 March 2015)

DATUK LING SUK KIONGNon-Independent Non-Executive Director

BAILEY KHO CHUNG SIANGNon-Independent Non-Executive Director

HAMDAN RASIDNon-Independent Non-Executive Director

COMPANY SECRETARYLeong Oi Wah (MAICSA 7023802)

AUDIT & RISK MANAGEMENT COMMITTEELeong Pooi WahChairman Raja Anuar Raja Abu HassanMemberDato’ Amos Siew Boon Yeong Member

REMUNERATION COMMITTEERaja Anuar Raja Abu HassanChairmanDato’ Kho Poh EngMemberLeong Pooi WahMember

NOMINATION COMMITTEERaja Anuar Raja Abu HassanChairmanLeong Pooi WahMemberWong Chee LinMember

AUDITORSCrowe Horwath (AF 1018)Chartered AccountantsLevel 16, Tower C, Megan Avenue II12, Jalan Yap Kwan Seng50450 Kuala Lumpur

REGISTERED OFFICE & HEADQUARTERSNo. 6-8, Jalan Seri Utara 1Seri Utara, Batu 7, Jalan Ipoh68100 Kuala LumpurTel : +603-6257 1111Fax : +603-6257 7708E-mail : [email protected] : www.perdana.my

SHARE REGISTRARTricor Investor Services Sdn BhdLevel 17, The Gardens North TowerMid Valley City, Lingkaran Syed Putra59200 Kuala LumpurTel : +603-2264 3883Fax : +603-2282 1886

PRINCIPAL BANKERSHSBC Bank Malaysia Berhad (127776-V)United Overseas Bank (Malaysia) Berhad (271809-K)OCBC Bank (Malaysia) Berhad (295400-W)CIMB Bank Berhad (13491-P)Hong Leong Bank Berhad (97141-X)Malayan Banking Berhad (3813-K)

SOLICITORSMessrs. Chris Lim Su HengT109, 3rd FloorCentrepoint Bandar UtamaNo. 3 Lebuh Bandar Utama47800 Petaling Jaya, Selangor

Messrs. Adnan Sundra & LowLevel 11, Menara OlympiaNo. 8 Jalan Raja Chulan50200 Kuala Lumpur

Messrs. Ranjit Ooi & Robert LowNo. 53 Jalan Maarof, Bangsar59000 Kuala Lumpur

Messrs. Sidek Teoh Wong & DennisLevel 32, Menara TH Perdana1001 Jalan Sultan Ismail50250 Kuala Lumpur

Messrs. Wong Beh & TohLevel 19, West BlockWisma Selangor Dredging142-C Jalan Ampang50450 Kuala Lumpur

Messrs. Lee Hishammuddin Allen & GledhillLevel 16, Menara Tokio Marine Life189, Jalan Tun Razak50400 Kuala Lumpur

STOCK EXCHANGE LISTINGMain Market ofBursa Malaysia Securities BerhadSector : Trading/ServicesStock Code : 7108Stock Name : PERDANA

FINANCIAL HIGHLIGHTS

TURNOVER(RM’ Million)

SHAREHOLDERS’ FUND(RM’ Million)

NET PROFIT(RM’ Million)

NET ASSETS PER SHARE(RM)

’10

’11

’12

’13

’14

254.9

255.9

259.5

274.6

347.2

’10

’11

’12

’13

’14

(67.7)*

(69.2)

(3.7)

88.0

61.7

’10

’11

’12

’13

’14

1.13*

0.95

0.93

0.77

0.89

’10

’11

’12

’13

’14

508.3*

470.4

459.2

562.2

654.4

*Restated due to prior year adjustments by an associate

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BOARD OFDIRECTORS

CAPT SURYA HIDAYAT Managing Director

RAJA ANUAR RAJA ABU HASSAN Independent Non-Executive Chairman

WONG CHEE LIN Independent Non-Executive Director

LEONG POOI WAH Independent Non-Executive Director

DATO’ AMOS SIEW BOON YEONG Independent Non-Executive Director

Perdana Petroleum BerhadAnnual Report 2014 7

BOARD OFDIRECTORS

(CONT’D)

SOON FOOK KIAN Executive Director

DATO’ KHO POH ENGExecutive Director

SHAMSUL SAAD Executive Director

DATUK LING SUK KIONG Non-Independent Non-Executive Director

HAMDAN RASID Non-Independent Non-Executive Director



DIRECTORS’PROFILES

RAJA ANUAR RAJA ABU HASSAN Independent Non-Executive Chairman

Raja Anuar Raja Abu Hassan, a Malaysian, aged 60, was appointed as an Independent Non-Executive Director of Perdana Petroleum Berhad (“Perdana Petroleum” or “PPB”) on 18 March 2010. Raja Anuar was appointed the Chairman of the Board on 23 February 2015. He is also the Chairman of the Nomination Committee and Remuneration Committee and a member of the Audit & Risk Management Committee of PPB.

He is a Chartered Accountant by profession and is a member of the Malaysian Institute of Accountants, a member of the Malaysian Institute of Certified Public Accountants, a Fellow of the Association of Chartered Certified Accountants and a Chartered Member of the Chartered Institute of Internal Auditors.

During his career, he held senior positions in finance and internal audit in several public listed companies in various industry sectors. His broad working experience included, amongst others, holding positions as Internal Audit Manager of PROTON Holdings; Commercial Accounting Manager of Sime Darby Plantations; Head, Overseas Operations of Malayan Banking Berhad; General Manager, Internal Audit of Sapura Holdings and Director, Internal Audit of Golden Hope Plantations Bhd. He has considerable experience in the financial and reporting systems operating in a number of foreign countries, having served on numerous audit/non-audit related assignments in Asia, Europe, North America and North Africa.

He does not have any family relationships with any member of the Board or major shareholder of PPB. He does not have any conflict of interest with PPB and neither has he been convicted of any offence within the past 10 years.

CAPT SURYA HIDAYAT Managing Director

Capt Surya Hidayat, a Malaysian, aged 63, was appointed as an Independent Non-Executive Director and Chairman of Perdana Petroleum on 4 February 2010. He was then appointed to the Audit Committee but relinquished the positions of Chairman and member of Audit Committee upon his appointment as Executive Director of PPB on 23 April 2010. On 11 April 2013, he took on the position of Managing Director of PPB. He holds a Master Mariner Class 1 (Master Foreign Going) from the United Kingdom.

During the period from 1970-1980, he held various positions on board foreign going vessels under different flags. He was engaged by Kontena Nasional in 1980 and left to join Sarawak Shell Berhad (“Shell”) in 1981, where he held various management positions in the marine, supply base operations, logistics and procurement divisions. He was assigned various postings overseas, including the United Kingdom, Nigeria, Oman and Holland.

He also held a number of senior management positions in Shell. His last posting prior to his retirement in February 2010 was that of Contracting & Procurement Country Manager for Shell Malaysia Exploration & Production.

Capt Surya was also a member of the Board of Trustees for four of Shell’s pension funds for a period of nine years.


DATO’ KHO POH ENG Executive Director

Dato’ Kho Poh Eng, a Malaysian, aged 58, was appointed as an Executive Director of Perdana Petroleum on 4 February 2010. He holds a Bachelor of Commerce (Honours) from the University of Dalhousie, Nova Scotia, Halifax, Canada. He is a member of the Remuneration Committee of PPB.

Dato’ Kho started his career with a private limited company involved in crude oil quality and quantity survey of petroleum products in 1981 and left in September 1983 to join F.E. Zuellig (M) Sdn Bhd as its Branch Manager responsible for business development in East Malaysia. He was one of the co-founders of Damai Teknik Sdn Bhd in 1988 providing maintenance, engineering and manpower services for the upstream oil and gas industry in the country. His role in Damai Teknik includes providing management and technical services to Petra Resources Sdn Bhd (“PRSB”) since the founding of PRSB in 1988.

He joined PPB as Senior General Manager in 2000, and spearheaded the listing exercise of PPB, the transfer of the Company’s listing from the Second Board to the Main Board of Bursa Malaysia Securities Berhad (“Bursa Malaysia”) in January 2003, and the listing of Petra Energy Berhad on the Main Board of Bursa Malaysia in July 2007. As the Senior General Manager, he was also instrumental in the development and management of the PPB Group’s corporate and finance services. He has been key to various corporate exercises involving the PPB Group, such as acquisition of companies, vessels and integrated services for brown field projects.




(CONT’D)

SHAMSUL SAAD Executive Director

Shamsul Saad, a Malaysian, aged 51, was appointed as an Executive Director of Perdana Petroleum in 1 July 2009 and subsequently on 20 April 2010 assumed the position of Managing Director. He relinquished this position on 11 April 2013 and was re-designated to the position of Executive Director.

His oil & gas career started with Sarawak Shell Berhad in Miri, where he held various positions from 1988 to 1994. Upon leaving Sarawak Shell, he became General Manager of Techno Indah Sdn Bhd, a Kuok/Perlis Plantation joint venture with then Malaysia Shipyard and Engineering. In 1996, he took up the position of Managing Director of Oakwell Industries Sdn Bhd, an oil and gas equipment supplier and engineering maintenance services company.

He started his own company, Compact Ventures Sdn Bhd in 1999, to continue business in broadcast and multimedia design and systems integration as a follow up to his project work for the Kuala Lumpur Commonwealth Games 1998; today he still retains ownership of the company and remains its Executive Chairman.

Shamsul joined the PPB Group in 2001 with the Group’s major expansion in integrated brownfield services activities. Later he

was the Executive Director for the Group’s main operating company at the time, Petra Resources Sdn Bhd. He was the primary driving force behind the development of PPB Group’s offshore marine business, which started with the acquisition of Intra Oil Services Berhad (“IOS”) in 2004. He became the Executive Director of IOS and oversaw the Group’s marine operations. He was instrumental in charting the strategic growth of offshore marine as a core business within the PPB Group and its expansion as a significant regional player. The growth of marine as a major PPB core business enabled the Group to then list on Bursa Malaysia its original core business into then subsidiary, Petra Energy Berhad.

He was the Vice President of Malaysian Oil & Gas Services Council (“MOGSC”) from 22 April 2010 to 26 April 2012 after serving in its Executive Committee from 30 April 2008.

Shamsul Saad graduated from the University of Florida, USA in 1986 with a bachelor’s degree in Chemical Engineering.


SOON FOOK KIANExecutive Director

Soon Fook Kian, a Malaysian, aged 42, was appointed as an Executive Director of Perdana Petroleum on 12 December 2012. He holds a Diploma in Accountancy.

He began his career with an audit firm in 1995 and joined PPB in 1999 as Assistant Accounts Manager. He was promoted to Accounts and Finance Manager in 2001, overseeing the financial operations and management reporting of the PPB Group. He was transferred to the Chief Executive Officer (“CEO”) office in 2005 to support the CEO on the daily management of PPB. Later in 2010, he was appointed as the Executive Director of IOS, a wholly owned subsidiary of PPB, which is primarily responsible for most of PPB’s vessels’ chartering and operations. He held the position of General Manager of the Corporate Finance Department of Perdana Petroleum prior to his appointment as Executive Director.

Through the years of service in the PPB Group, Soon Fook Kian has contributed significantly in the formation and growth of PPB in the areas of corporate development and advisory, acquisition, corporate exercises and fund raising, tax planning, vessels’ chartering and operations. He was also instrumental in the introduction of the off balance sheet vessel financing to the Group’s vessel expansion program started in 2006.



DIRECTORS’PROFILES(CONT’D)

LEONG POOI WAH Independent Non-Executive Director

Leong Pooi Wah, a Malaysian, aged 48, was appointed as an Independent Non-Executive Director of Perdana Petroleum on 12 December 2012. He is the Chairman of the Audit & Risk Management Committee of PPB and a member of Nomination Committee and Remuneration Committee.

He is a Chartered Accountant with the Institute of Chartered Accountants in England and Wales. He has over 20 years of diverse experience in Malaysia and overseas having commenced his career in 1990 in the United Kingdom (UK).

He holds a degree, BA (Honours) in Accounting Studies from UK and worked in UK and Singapore for a total of 7 years in the 90’s in 2 accounting firms. He returned to Malaysia in the late 90’s before working in Ernst & Young, Kuala Lumpur for a total of 4 years.

He acquired and established his own audit firm in 2003 and currently is the Managing Partner of the firm, Yong & Leonard based in Petaling Jaya, Selangor, Malaysia. Yong & Leonard have a wide range of clients including multi-national companies and companies listed on the Bursa Malaysia.


WONG CHEE LINIndependent Non-Executive Director

Wong Chee Lin, a Malaysian, aged 55, was appointed as an Independent Non-Executive Director of Perdana Petroleum on 4 March 2014. She is a member of the Nomination Committee.

She graduated from Hertford College, Oxford University, UK in Politics, Philosophy and Economics (PPE) with honours. She then enrolled in City University to obtain a diploma in law and thereafter, was called to the English Bar. She has been in legal practice in Malaysia with Skrine since 1985 and became a partner of the firm in 1994.

Her commercial practice is broad and covers corporate insolvency, company and commercial litigation including recovery work, voluntary arrangements and restructuring, contracts, corporate wrongdoing and misfeasance, banking and finance, partnership, guarantees and other securities, directors’ duties and liabilities, shareholders disputes and receivership and liquidation. Her commercial litigation experience also encompasses acting in arbitrations and in expert determination.

She has acted for office holders, companies, directors and debtors in all aspects of personal and corporate insolvency. Chee Lin is also frequently retained as solicitor and regularly advises the leading accounting firms on various aspects of the law relating to receivership, liquidation and corporate rescue matters as well as representing them as Counsel in cases where legal proceedings are filed. She also won the ILO Client Choice Award for Insolvency and Restructuring Practitioner of the Year (Malaysia) 2011 & 2012.

She does not have any family relationships with any member of the Board or major shareholder of PPB. She does not have any conflict of interest with PPB and neither has she been convicted of any offence within the past 10 years.

DATO’ AMOS SIEW BOON YEONGIndependent Non-Executive Director

Dato’ Amos Siew Boon Yeong, a Malaysian, aged 57, was appointed as an Independent Non-Executive Director of Perdana Petroleum on 13 March 2015. He is a member of the Audit & Risk Management Committee.

He qualified as a Certified Public Accountant in 1984 and is currently a member of the Malaysian Institute of Certified Public Accountants, a Chartered Accountant with the Malaysian Institute of Accountants and an associate member of the Chartered Tax Institute of Malaysia. He is also a Certified Financial Planner and is a member of the Financial Planning Association of Malaysia.

He started his auditing career and professional training with the international accounting firm Coopers & Lybrand in 1978 before establishing his own accounting practice in 1988. He is currently the sole practitioner of the public accounting firm Messrs. Siew Boon Yeong & Associates.

Dato’ Amos Siew Boon Yeong has over 30 years of experience in the finance field specialising in auditing, taxation and corporate finance and has been involved in numerous assignments on due diligence, merger and acquisitions, debt restructuring and liquidation. He was also involved in Reporting Accountants’ engagements for many corporate exercises. He is also a Director of EcoFirst Consolidated Bhd and SEG International Berhad.




(CONT’D)

DATUK LING SUK KIONG Non-Independent Non-Executive Director

Datuk Ling Suk Kiong, a Malaysian, aged 69, was appointed as a Non-Independent Non-Executive Director of Perdana Petroleum on 12 December 2012.

He is the founder of Dayang Enterprise Holdings Berhad’s Group of Companies (“Dayang Group”). He established Dayang Enterprise Sdn Bhd in 1980 and has been instrumental in the growth and development of the Dayang Group. He brings with him more than thirty (30) years of experience in the Oil and Gas Industry and is mainly responsible for the overall strategic business direction of Dayang Group.

His career started in 1968 when he joined Kong Thai Sawmill (M) Sdn Bhd as Officer in Charge of the Miri office. He was subsequently promoted to Assistant Manager in 1969 and in 1977, he was again promoted to Manager at Kong Thai Sawmill (M) Sdn Bhd. He subsequently went on to establish the Dayang Group in 1980 and is presently the Executive Deputy Chairman of Dayang Enterprise Holdings Berhad.



Bailey Kho Chung Siang, a Malaysian, aged 54, was appointed as a Non-Independent Non-Executive Director of Perdana Petroleum on 12 December 2012.

He graduated in 1984 from the University of Canterbury, New Zealand with a bachelor of Commerce degree. He began his career in 1985 when he joined Hanafiah Raslan Mohammad as an Audit Semi-Senior Officer. Subsequently in 1986, he took up the position as manager with Tan Jin Kok & Co and was appointed as Director with TJK Taxation and Management Services in 1989.

In 1991, he joined Bumi Armada Navigation Sdn Bhd as Finance Manager and as Company Secretary of Bumi Armada Berhad. In 1997, he left and joined Oleander Enterprise Sdn Bhd as Personal Assistant to the Chairman. In 1999, he left and took up the position as Associate Consultant with TJK Taxation and Management Services Sdn Bhd before joining Dayang Enterprise Sdn Bhd as the Financial Controller in 2000. He brings with him many years of experience in the field of finance and accounting. He is currently the head of Corporate Affairs and Joint Company Secretary of Dayang Enterprise Holdings Berhad and its subsidiaries, having assumed this position in 2008 and is responsible for overseeing the financial and secretarial aspects of Dayang Group.


HAMDAN RASIDNon-Independent Non-Executive Director

Hamdan Rasid, a Malaysian, aged 56 was appointed as a Non-Independent Non-Executive Director of Perdana Petroleum on 20 July 2010.

He obtained his Degree in Accountancy from UiTM and is a member of the Malaysian Institute of Accountants. He began his career as Senior Internal Audit with Bank Bumiputra Malaysia Berhad (“BBMB”) from 1981 to 1987. He then joined BBMB Discount House in 1987 and served as the Deputy Chief Executive until the year 2000. He was later promoted and appointed as the Vice President of Bumiputra Commerce Bank Berhad from year 2000 to 2001. In 2002, he was appointed as Vice President (Treasury & Investment) of Affin Merchant Bank Berhad. He was also the Associate Consultant for Ciptaan Wawasan Sdn Bhd from 2005 to 2007. He is currently the General Manager (Fixed Income) of Investment Department in Lembaga Tabung Haji and a member of the Board of TH Properties Sdn Bhd.



MANAGEMENTTEAM

ISKANDAR SHAHHead of Safety (IOS/PNSB)

MASLINA ABDULLAHSenior ManagerChartering (IOS/PNSB)

MD ARIFFIN SALEHUDDINFleet Manager (PMO)

CAPT MOHD FAIZAL MUSTAFASenior ManagerOperation (IOS)

KOH PHO WATExecutive Director (PMO)

TEO SWEE HONGExecutive Director (IOS)

CHRISTOPHER THENExecutive Director (IOS)

FARID KHAN KAIM KHANDirector (PMO)

DAVID KWEKManagerRisk Management

CHRISTABELLE HOManagerProcurement (IOS)

KAY WOON PINGManagerCrewing (IOS)

ALVIN KHO TEE SEONGManagerCorporate Finance


MANAGEMENTTEAM

(CONT’D)

LEONG WAI LIANGeneral ManagerHuman Resource

EDWIN LIM General ManagerLegal

CATHERINE LEEManager Administration

JEFFREY NG CHONG YAUManagerInformation Technology

AGNES YAPFinancial Controller

PADMARAJEN KARUPPANGeneral ManagerFleet Management (IOS/PNSB)

LOO YUEN KONGManagerInternal Audit

HANESA AHMAD THANIManagerFinance and Administration (PMO)

CAPT MOHD KEMAL RISWANDHAManagerOperations/Crewing & Training (PMO)

JAMES ONGManagerOrganisation & Methods

WORKING AS A

TEAM

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