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annual report 2014

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What’sNext.

Inspiring


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W h a t ’ s

N e x t.


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We are the leading communicationsservice provider in Malaysia, enabling bothindividuals and businesses to connect andcommunicate anytime and anywhere. Weare passionate about what we do, andobsessed with providing an unmatchedexperience to our customers.

Our customers enjoy a superior Internetexperience, make voice calls and text, andimmerse themselves in an ever expandinguniverse of connected applications onthe most advancedcellular network,encompassing 3G and 4G LTE technologies.

We Are Maxis

2

Our passion drives us to innovate andmarket services that are worry-freeand ‘Always On’ for our customers, sothey can stay focused on the pursuitof their goals. For our enterprisecustomers, our integrated solutions area compelling proposition which enablesthem to enhance their business goals.

Our people are our competitiveadvantage. We prepare for the futuretoday by developing the skills andtalent of all employees, making Maxisa great place to work for great people.

Underpinning this is the MaxisWay, ourapproach to work that champions passion,positivity, and collaboration.

Beyond connecting people with ourservices, we are passionate about making apositive impact on the community in whichwe operate. Our Corporate Responsibilityefforts aim to develop and enrich ourcommunity, customer and partners, makingworking and learning fun, while advocatingenvironmentally friendly practices.

Maxis Berhad

Annual Report 2014


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2 We Are Maxis6 How We’ve Performed

7 Financial Highlights

8 What’s Important To Us 12 Chairman’s Statement

15 CEO’s Statement

20 Group Quarterly FinancialPerformance21 Summarised Group Statement of

Financial Position22 Investor Relations

25 Corporate Information

50 Corporate Governance

65 Audit Committee Report69 Statement on Risk Management and

Internal Control75 Directors’ Responsibility Statement

Overview

Corporate Governance

Our Business

Other Information

Strategic Review

Financial Statements

Scan the QR code to view videos.This icon tells you where you can nd more information online on maxis.com.my

OUR NEW FEATURES IN THIS ANNUAL REPORT

28 What We Do30 Directors’ Pro les

37 Maxis Management Team

193 Size of Shareholdings

193 Distribution Table According toCategory of Shareholders

194 Directors’ Interest in Shares195 30 Largest Shareholders 197 Information on Substantial

Shareholders

199 List of Properties Held201 Disclosure of Recurrent Related

Party Transactions

203 Additional Disclosures

204 Material Contracts

211 Glossary212 Notice of Annual General Meeting

Proxy Form

40 Our Customers42 Our Products

44 Our Network Transformation

46 Our People48 Our Corporate Responsibility

76 Directors’ Report

83 Statements of Pro t or Loss84 Statements of Comprehensive

Income85 Statements of Financial Position

87 Statements of Changes in Equity

91 Statements of Cash Flows94 Notes to the Financial Statements 189 Supplementary Information

190 Statement by Directors190 Statutory Declaration

191 Independent Auditors’ Report to theMembers of Maxis Berhad

Table of Contents

3Maxis BerhadAnnual Report 2014


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>> inspiringconnections


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“We don’t make

claims lightly.Everything we do istried and tested.”

t h e n

e w MA X I S N E T W O R K


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Maxis Berhad

Annual Report 2014

How We’ve Performed

Growing revenue generating subscriptions again insecond half 2014

Impacted by lower service revenue and higher marketingspend to support business

Impacted by lower EBITDA and accelerated depreciation onnetwork modernisation

Challenging transformation year; operational indicators trending up

Commitment towards superior network and service experience

Modernised network supporting faster data speed

Service Revenue Mobile Subscriptions

PAT 2

EBITDA1

CAPEX 3

Mobile Internet Users

12.9 million

RM4.2 billion

RM1.7 billion

RM8.2 billion

8.8 million

RM1.1billion

view the full resultson maxis.com.my/investor

Notes:1 Earnings Before Interest, Taxes, Depreciation and Amortisation2 Pro t After Tax3 Capital Expenditure


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OverviewOurBusiness

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CorporateGovernance

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OtherInformation


Financial Highlights

2013-2014YOY

2014 2013 2012 ChangeFINANCIAL RESULTS

Financial Indicators (RM’m)Revenue 8,389 9,084 8,967 (7.7%)Service revenue 8,229 8,514 8,539 (3.3%)EBITDA 4,229 4,310 4,359 (1.9%)Normalised EBITDA(1) 4,207 4,522 4,359 (7.0%)Pro t from operations 2,816 2,825 2,864 (0.3%)Pro t Before Tax (“PBT”) 2,436 2,496 2,576 (2.4%)Pro t After Tax (“PAT”) 1,725 1,772 1,860 (2.7%)Normalised PAT (2) 1,910 2,097 2,049 (8.9%)Pro t attributable to equity holders of the Company 1,718 1,765 1,856 (2.7%)

Financial RatiosEBITDA margin (%) 50.4 47.4 48.6Normalised EBITDA margin (%) 50.1 49.8 48.6PBT margin (%) 29.0 27.5 28.7PAT margin (%) 20.6 19.5 20.7Normalised PAT margin (%) 22.8 23.1 22.9Interest cover ratio 6.6 7.9 8.4Earnings per share (sen)

- basic 22.9 23.5 24.7- fully diluted 22.9 23.5 24.7Dividends per share (sen) (3) 40.0 40.0 40.0

FINANCIAL POSITIONS

Financial Indicators (RM’m)Equity attributable to equity holders of the Company 4,716 6,002 7,049Total assets 18,109 17,330 17,802Total borrowings 8,798 7,525 7,312

Financial RatiosReturn on Invested Capital (%) 16.9 16.1 15.9Return on Average Equity (%) 32.1 27.1 24.5Return on Average Assets (%) 12.0 12.0 12.2Gearing ratio 1.53 1.12 0.90Net assets per share attributable to equity holders of the Company (RM) 0.63 0.80 0.94

Notes:(1) Exclude one-off items for the following years:

(a) Year 2014 - reversal of contract obligations of RM22 million(b) Year 2013 - RM212 million comprising (i) Career Transition Scheme (“CTS”) costs of RM143 million; (ii) provision for contract obligations of RM65 million; and (iii) write down of assets of RM4

million(2) Exclude one-off items (after tax effect) for the following years:

(a) Year 2014 - RM185 million comprising accelerated depreciation of RM201 million offset by reversal of contract obligations of RM16 million(b) Year 2013 - RM325 million comprising (i) CTS costs of RM107 million; (ii) provision for contract obligations of RM49 million; (iii) write down of assets of RM65 million; and (iv) accelerated

depreciation of RM104 million(c) Year 2012 - RM189 million comprising (i) accelerated depreciation of RM121 million; and (ii) write down of assets of RM100 million, offset by last mile broadband tax incentive of RM32 million

(3) Dividends per share consist of interim and nal dividends declared and proposed in respect of the designated nancial years.


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Maxis Berhad

Annual Report 2014

What’s Important To Us

We don’t just aim to please. Our toppriority is to create as many LIKEmoments as possible for our customers.By delivering meaningful solutionsand embedding unmatched customerexperiences into our processes, we aimto deliver on our brand promises to ourcustomers.

In other words, we want to make theirwhole journey with us, one huge big LIKE!

We believe network coverage andquality are real differentiators for usand our customers. So much so, we arecontinually expanding the reach of ourmodernised network, upgrading it toincrease speed, consistency and reliabilityof service. We are also rapidly expandingour superfast 4G LTE network.

We want to deliver the best data and voiceexperiences to our customers, so workingon our network coverage and quality issomething that is very important to us.

We need the best people to be able todeliver. That’s why attracting, retainingand developing talent is another keypriority for us. Besides investing ingrowing and deepening our talents’ skillsset, we have refreshed our communicationtools and reinvigorated our workenvironment into one that encouragesopenness, fun and collaboration.

These values are re ected in ourMaxisWay, involving every one of us inour organisation. MaxisWay is not just aculture; it is a mindset that enables newways of working for all of us within Maxis,and also outside of it.

HAPPYCUSTOMERS

BESTNETWORK

BESTPEOPLE

These are the FIVE key areas of focus for us.


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OverviewOurBusiness

StrategicReview

CorporateGovernance

FinancialStatements

OtherInformation


We are rising to the challenge of constant global pressures bythinking out-of-the box when creating innovative solutions.We are always building new products and services, andinnovative digital services that are relevant and meaningful in anincreasingly digitalised world.

We offer differentiated experiences and better value to ourcustomers, carving out our competitive advantages in theindustry that will keep us at the top of our customers’ minds.

For the enterprise segment, this also means we are furtherdeveloping our capabilities and partnerships, to create new waysof working for businesses and their own customers.

We are conscious of our responsibili ty towards making a positiveimpact on society, especially within the communities in whichwe operate. Through the years, we have been involved in effortsto help strengthen the communities by equipping them withskills to improve and enrich their lives through technology. Wecontinue to support MCMC’s initiatives to promote the widespreadavailability and usage of communication services in underservedareas, which includes the Pusat Internet 1Malaysia, KampungTanpa Wayar and WiFi 1Malaysia. We also contribute towardshumanitarian causes such as providing relief aid fordisaster victims. Our focus on technology and education will move into thenext phase which will make a direct impact on learning in theclassroom. This supports the Government’s aspiration to use ICTto scale up the quality of learning across schools in the country. At Maxis, we are passionate about inspiring positive changes tothe community and generating sustainable results!

INNOVATIVESOLUTIONS

STRONGCOMMUNITYRELATIONS

They form the running themes throughout this report.


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ONE PLAN

ZERO WORRIES


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“UnmatchedCustomerExperience.”

m a x i s o n e p l a n


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Maxis Berhad

Annual Report 2014

Chairman’s Statement

The transformation exercise that we are undertaking is on a positive momentum andI am proud to say that our people are energised. With these changes, I am confdentthat we are on the right path to excellence.

We havemade steadyprogress in ourtransformation journey

maxis.com.my/chairman


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OverviewOurBusiness

StrategicReview

CorporateGovernance

FinancialStatements

OtherInformation


GROWTH AND EVOLUTION

The industry continued to be challengingin 2014, with increasing and toughercompetition amongst existing playersin the market. With the ever expandingdigitalised world and maturing industry,Over-The-Top (“OTT”) players areincreasingly strengthening their positionsin the market with their Internet-basedmessaging services, impacting industrySMS and voice revenues, and limitingindustry growth during the year. Newentrants are also emerging, somewith more competitive pricing, whichpotentially pose a longer term threat.

On a more positive note and in tandemwith global trends, there is a continuingupshift in data usage. More andmore users are turning towards theirsmartphones and mobile Internet to ful l

their daily communications needs.So, 2014 was critical for Maxis becausewe started transforming our fundamentalsto meet these accelerating demandsand deliver greater experiences toour customers.

GROUP PERFORMANCE

Overall, we had a solid end to the year.We are growing our revenue generatingsubscriber (“RGS”) base again,particularly in prepaid where in the fourth

quarter of 2014 alone, we added 536,000new RGS prepaid customers.

Group service revenue was at RM8.2billion for the year, 3.3% lower than 2013,mainly due to the impact of our decision

to introduce worry-free propositions inthe way we charge for data and roaming.The impact of voice and SMS was also afactor in our nancial performance.

In 2014, Maxis delivered an EBITDA ofRM4.2 billion with corresponding EBITDAmargin of 50.4%, marginally lower thanRM4.3 billion recorded in 2013. The lowerEBITDA takes into account lower servicerevenue and higher marketing spend tosupport the business. As a result, Pro tAfter Tax for the year was 2.7% lowercompared to 2013, at RM1.7 billion.

The Board of Directors is pleased torecommend for shareholders’ approval atthe forthcoming Annual General Meeting,a nal single-tier tax-exempt dividend ofeight sen per share for the nancial yearended 31 December 2014.

The four interim dividends paid andrecommended nal dividend will bringthe total dividend for 2014 to 40.0 senper share.

If approved, the Company would havedeclared and delivered a total of RM2.15per share in cumulative dividends sincethe IPO in 2009, amounting to a totalpayout of RM16.1 billion to shareholders.

GOOD PROGRESS ONTRANSFORMATION

I am extremely pleased to report thatwe have made steady progress in ourtransformation journey that we undertookduring the year. We invested signi cantlyin modernising our network, and our

invested in network and 4G LTE expansion in 2014 to provide signi cantly

improved voice and data quality.

billion

CAPEX

RM1.1

various customer experience initiativesare on track, where we have seen anenhancement to our service delivery andcustomer satisfaction levels. In the same

year, we launched the MaxisONE plan andMaxisONE Business and we are seeinggood customer traction with these twokey products. Our retail modernisationand expansion plans to provide the bestsales and service experience to ourcustomers are also progressing well.

Our network remains a critical componentof our transformation journey, and weinvested RM1.1 billion in this area for2014. During the year, we continued withour network modernisation initiatives

as well as 4G LTE expansion. As aresult, more than three quarters of ournetwork is now modernised and our4G LTE coverage is expanding rapidly,covering all major market centres,state capitals and secondary towns.


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Maxis Berhad

Annual Report 2014

With these developments, our highspeed mobile networks remain the mostcomprehensive, and we have scoredhigh on all aspects of customer networkexperience through independent testing.

While we have made e cient use ofspectrum allocated to us, the ever-growing demand for data will drivecontinued need for spectrum. In thisregard, we are requesting approval fromthe regulator, MCMC to utilise our 1800MHz spectrum to further improve thequality of our 4G LTE services acrossthe nation. We will continue to work withthe regulator on spectrum availability,including lower frequency bands such asthe 700 MHz and 800 MHz bands.

We are building an organisation witha high performance culture. Theorganisational structure is now simpli ed

and our workspace has been revampedto re ect an open, fun and collaborativeculture which is our new way of working.The transformation exercise that we areundertaking is on a positive momentumand I am proud to say that our peopleare energised. With these changes, I amcon dent that we are on the right pathto excellence.

THE BOARD’S COMMITMENT

The Board continues to uphold and

implement the highest standards ofcorporate governance throughout theCompany. Details of our corporategovernance initiatives and internal controlpolicies are in the relevant sections of this

Annual Report. We value the bene ts ofdiversity on the Board and will continueto promote diversity in all its aspects.

CORPORATE RESPONSIBILITY

We always place high importance onsustainability in our business. Aimedat creating a positive impact for thecommunities in which we operate, ourown community agship initiative isfocused primarily on education andtechnology. I am proud to note that ourMaxis Cyberkids programme continuedto reach out to underserved, rural andisolated communities, educating studentsand teachers about basic IT knowledge.More than 8,600 teachers and students in1,515 schools nationwide have bene ttedfrom the programme since 2002.

We plan to move into a new dimension

of our community programme in 2015,where we want to make a direct impacton teaching and learning by incorporatingdigitalised syllabus into the classroomfor students and teachers. This will betargeted to both the urban and ruralpoor. With this plan, we aim to supportthe government’s aspiration to use ICTto scale up the quality of learning acrossschools in the country.

Also on the education front, our MaxisScholarships for Excellence Awards

(MSEA) programme continued tooffer scholarship opportunities to allMalaysians to pursue undergraduatestudies in the elds of Engineering,Technology, and Social Sciences in top

institutions overseas. During the year,10 scholarships were awarded todeserving students.

ACKNOWLEDGEMENTS

On behalf of the Board, I would like tothank KKMM and MCMC, our customers,business partners, associates and ourshareholders, to whom we remaingrateful for their support and con dence. I have bene ted from the shared wisdomof my colleagues on the Board and wouldlike to thank them for their guidance andcontribution. I would like to express my gratitude to theCEO, Morten Lundal, and Managementfor their leadership and to all the staff fortheir positive support and commitment.

I remain excited to work together withthe Board and the Maxis team in thetransformation journey which we haveembarked and I look forward to a betteryear ahead.

RAJA TAN SRI DATO’ SERI ARSHADBIN RAJA TUN UDA


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StrategicReview

CorporateGovernance

FinancialStatements

OtherInformation


CEO’s Statement

It is fascinating to take a few steps back and think about the changes that are driven

by the Internet, especially Internet accessed by mobile phones.

We have gotten used to reading articles about how the Internet is changing all theseindustries, but as we bene t from this change and as demand for data increases, wealso are deeply affected by it. We see a fundamental change in user behaviour; thesedays, a text message is much the preferred communication method versus a voice call.And, those messages are increasingly sent via a variety of Internet-based messagingsoftware tools as well as social media, reducing the demand for both our voice and SMSservices. That means data quality, experience and pricing become imperative, for bothour users and ourselves.

A Fundamentally

Changing Industry

maxis.com.my/ceo


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Maxis Berhad

Annual Report 2014

2014 was a critical and exciting year in thetransition towards ‘data being everything’.The industry was energetically competitive,yet we were simultaneously transformingMaxis fundamentally with the cleargoal of revitalising and re-focusing thecompany into delivering the very best inmobile Internet access and an unmatchedcustomer experience. In such a challengingenvironment, we have taken bold and

innovative steps with our transformationinitiatives, xing many areas of thecompany and introducing drastic changes.We are fully focused on getting Maxisback on track to being a high-performancecompany, moving from good to great andbecoming an organisation that is admiredfor excellence.

WHAT WE’VE DONE…

Last year, I mentioned a few priorities– regaining momentum in the prepaid

segment, increasing data usage bydelivering a worry-free and UnmatchedCustomer Experience, enhancing ourenterprise capabilities and developinghighly capable and engaged people. Iam happy to report that we have madesigni cant progress on each of these.

Firstly, we are turning around in prepaidand regaining market share. This is ledby a unique prepaid offering - #Hotlink– which features the industry’s rst FreeBasic Internet, as well as strengthening

of our distribution network. In 2014, wesaw good subscriber growth (includingin underserved segments), reducedchurn and increase in the mobile Internetpenetration rate.

Secondly, we launched our MaxisONEplan for postpaid customers. This planwas developed with the belief that payingfor calls and SMS is a thing of the past,so we made a vital change by offeringtruly limitless voice and SMS as well as

worry-free data. This game-changing planhas received very good traction, bringingin a good balance of new and migratedsubscribers as well as good ARPU impact.

We also did away with Pay-Per-Use (PPU)charges on both domestic and internationalroaming data usage. This decision wasmade so that our customers can truly feelfree when they use their phones, either

at home or abroad. We took a hit on ourrevenue as a result of this, but it wascertainly the right decision to make.

In Enterprise, we are strengthening ourcapabilities to offer new ways of workingand drive businesses towards digitaltransformation. We launched innovativeproducts and services like MaxisONEBusiness (offering limitless voice andSMS, with business grade services), xedmanaged services and cloud solutions.We also introduced FINDIT, which is now

the largest digital business directory inMalaysia. Response to our initiatives hasbeen encouraging, and we have seengrowth in revenues coming from our SMEand xed line customers.

As we work towards growing our shareof mobile data tra c in Malaysia, we alsohave to work on ensuring our users getthe best network experience possible. Withthe Internet going increasingly mobile, wecontinued to experience high and growingdemand for our data services. We already

have a very competitive network servinga majority of the population as well asleading the 4G LTE population coverage inthe country. But we need to have the bestnetwork to build the capabilities that werequire to meet the accelerating demandfor data.

Our data tra c is projected to grow overve times in the next three years and our

considerable RM1.1 billion investment duringthe year now sees a brand new network

covering almost three quarters of thepopulation, providing signi cantly improvedvoice and data quality. Meanwhile, ourleading 4G LTE network now covers keymarket centres and state capitals, offeringfour times faster downloads and a bettervideo streaming experience.

With our improving network as well asdrastic measures taken in removing

PPU charges for data usage, customercomplaints have dramatically reduced– almost halved compared to 2013. Wecertainly want to improve our capabilitiesfurther and ensure we deliver unmatchedexperiences to our customers on the bestdata network. We are also complementingour network initiatives by ensuringtouchpoint excellence in our distributionchannel; from our retail stores and callcentres to the way people use mobileapplications to access their information andconduct transactions.

Last but certainly not least, we have re-energised our people and organisationto ensure that they are an importantcompetitive advantage for us. In 2014, werolled out the MaxisWay to promote anopen-minded performance culture focusedon the values; Positive, Passionate andCollaborative. This is now our companyDNA, where we have put in place a culturalchange to develop highly capable andengaged people in driving towards a highperforming organisation.

We use our annual survey withemployees, Voice of Maxis (VOM),to gauge how engaged our peopleare. For the last seven years, Maxishas been in the decline in employeeengagement. Last year we boosted thatscore signi cantly back to 2007 levelagain. Our o ce environment was alsorevitalised, resulting in one of the mostmodern workspaces in Malaysia, enablingnew ways of working for our people.


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All of these changes have driven ouroperational indicators upwards. However,these improvements will take some timeto translate into nancials results, as someof the decisions we made are right forthe customers but reduced short-term

nancials. But as I have mentioned, wefeel these are absolutely the right thingsto do, and expect to see nancial returnson them in 2015 as more customers get to

experience the difference by beingwith Maxis.

MAXIS IN 2015: ADMIRED FOREXCELLENCE

So where do we go from here? Imentioned last year that 2014 would be ayear of transformation, and we aimfor 2015to be a year of performance, towards ouraspiration over time to be admiredfor excellence.

Hence, in 2015, we will intensify ourefforts to provide an even better dataexperience for prepaid, postpaid andintegrated services for customers byintroducing new innovative bundles andplans as well as rewarding loyal customers.We remain focused on providing anUnmatched Customer Experience andcreating more ‘LIKE’ moments for ourcustomers and a winning brand. We willalso continue to push on with our multi-channel transformation to be the leader incustomer touchpoints and service. On the

Enterprise front, our efforts to enable newways of working and digital transformationfor businesses will be strengthened, withsmarter solutions that further enhancethe value of our best-in-class mobileservices. These will be complementedby our continuous investment in ournetwork to provide customers with thebest network experience in terms ofquality and coverage. In order to achievethese goals, we have to continue withour people agenda with best-practicepeople management, development and

engagement based on the MaxisWay.

2015 & BEYOND

It is really important and meaningful to becritical enablers in the digital transition ofpeople’s daily lives and the way Malaysianbusinesses work. We are dedicated tobecome Malaysia’s leading digital enablerand we are energetically transforming

Maxis in that direction. As we are proudof the changes done in 2014, we are noweven more looking forward to What’s Nextin 2015, which will be an important year forMaxis.

We absolutely need to and de nitely intendto continue building upon the foundationthat our transformation exercise has laidfor the organisation. Maxis shall in 2015

move several steps closer to “Excellence”and I look forward to us being a winningbrand, with truly Unmatched CustomerExperience, the best network and ITsystems, and the most engaged andcompetent organisation in Malaysia.

I want to thank the Board of Directorsfor their support, guidance andcontributions. My appreciation also goesto the Management and staff for all theirdedication and hard work at making ourtransformation year a success.

On behalf of Maxis, a big thank youto our customers, business partnersand dealers for their unwaveringsupportand con dence.

MORTEN LUNDAL

Service revenue

PAT

EBITDA

EBITDA margin

RM8.2 billion

RM4.2 billion

RM1.7billion50.4

%

FINANCIAL HIGHLIGHTS


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“To beAdmired forExcellence.”

m a x i sw a y


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Maxis Berhad

Annual Report 2014

Group Quarterly Financial Performance

2014

FirstQuarter

SecondQuarter

ThirdQuarter

FourthQuarter

Year2014

2014 FINANCIAL PERFORMANCE

RM’m

Revenue 2,119 2,082 2,065 2,123 8,389Service revenue 2,037 2,049 2,049 2,094 8,229

EBITDA 1,073 1,086 1,070 1,000 4,229Normalised EBITDA 1,073 1,064 1,070 1,000 4,207Pro t from operations 747 725 744 600 2,816

PBT 657 634 643 502 2,436

PAT 488 451 451 335 1,725Normalised PAT 517 480 494 419 1,910

Pro t attributable to equity holders of theCompany 484 446 449 339 1,718

Earnings per share - basic (sen) 6.4 5.9 6.0 4.5 22.9Dividends per share (sen) (1) 8.0 8.0 8.0 16.0 40.0

2013First

QuarterSecondQuarter

ThirdQuarter

FourthQuarter

Year2013

2013 FINANCIAL PERFORMANCE

RM’m

Revenue 2,327 2,294 2,239 2,224 9,084Service revenue 2,143 2,136 2,127 2,108 8,514

EBITDA 1,122 1,165 1,052 971 4,310

Normalised EBITDA 1,122 1,165 1,154 1,081 4,522

Pro t from operations 745 816 749 515 2,825PBT 666 735 667 428 2,496

PAT 476 530 474 292 1,772Normalised PAT 521 560 550 466 2,097

Pro t attributable to equity holders of theCompany 475 528 472 290 1,765

Earnings per share - basic (sen) 6.3 7.0 6.3 3.9 23.5Dividends per share (sen) (1) 8.0 8.0 8.0 16.0 40.0

Note:(1) Dividends per share consists of interim and nal dividends declared and proposed in respect of the designated nancial periods/years.


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Summarised Group Statement ofFinancial PositionTOTAL ASSETS

TOTAL EQUITY AND LIABILITIES

2014RM’m 4,008 11,176 971 1,531 245 139 39

2013RM’m 4,038 11,167 947 808 145 131 94

2014RM’m 751 3,965 3,456 649 9,027 199 16 46

2013RM’m 750 5,251 2,806 566 7,552 245 118 42

Property,plant and

equipmentIntangible

assets

Receivables,deposits andprepayments

Cash and cashequivalents

Derivativefnancial

assets

Deferred taxassets and tax

recoverable Other assets

Share capital ReservesPayables and

accruals

Taxation anddeferred tax

liabilities Borrowings

Provisions forliabilities and

charges

Derivativefnancial

liabilities

Otherliabilitiesand non-

controllinginterest

201361.7%

49.8%

64.4%

5.4%

1.1%

5.5%8.4% 4.7%

1.4%

0.3%0.1%

0.8%0.8% 0.8%0.2% 0.5%

22.1%

4.1%

21.9%

19.1%

3.6%

23.3%

2014

20132014 43.6%

1.4%

0.2%0.7% 4.3%

30.3%

16.2%

3.3%


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Maxis Berhad

Annual Report 2014

Investor Relations

COMMITMENT TO LONG-TERM VALUEFOR SHAREHOLDERS

Since its listing in November 2009, Maxishas been rewarding shareholders withcash returns on a regular basis throughthe declaration of interim dividends ona quarterly basis and a nal dividend ineach nancial year.

In nancial year 2014, Maxisrecommended dividends totallingapproximately RM3.0 billion (40.0 senper share) to our shareholders. Thesedividends comprise:

• Four interim dividends ofapproximately RM600 million (8.0 senper share) per quarter amounting toapproximately RM2.4 billion (32.0 sennet/share) for the year; and

• A recommended nal dividend

of approximately RM600 million(8.0 sen per share) subject toshareholders’ approval

The total dividend payout of 40.0 senper share represents a dividend yield of5.8% based on the closing share price ofRM6.85 as at end 2014.

DIVIDEND POLICY

Our full dividend policy, as stated in ourIPO prospectus dated 28 October 2009 is

reproduced below for reference:

“The declaration of interim dividends andthe recommendation of nal dividendsare subject to the discretion of the Boardand any nal dividend for the year issubject to shareholders’ approval. It is theCompany’s intention to pay dividends toshareholders in the future. However,

such payments will depend upon anumber of factors, including Maxis’earnings, capital requirements, general

nancial conditions, the Company’sdistributable reserves and other factorsconsidered relevant by the Board.

The Company has proposed to adopta dividend policy of active capitalmanagement, and proposes to paydividends out of cash generated by itsoperations after setting aside necessaryfunding for network expansion andimprovement and working capital needs.

As part of this policy, the Companytargets a payout ratio of not less than75% of its consolidated Pro t After Taxunder Malaysian Generally AcceptedAccounting Standards (GAAP) in eachcalendar year beginning nancial yearending 31 December 2010, subject to

the con rmation of the Board and to anyapplicable law, license and contractualobligations and provided that suchdistribution would not be detrimental to itscash needs or to any plans approved by itsBoard.

Investors should note that this dividendpolicy merely describes the Company’spresent intention and shall not constitutelegally binding statements in respect ofthe Company’s future dividends whichare subject to modi cation (including

reduction or non-declaration thereof) atthe Board’s discretion.

As the Company is a holding company,its income, and therefore, its abilityto pay dividends, is dependent uponthe dividends and other distributionsthat it receives from its subsidiaries.The payment of dividends or other

distributions by the Company’ssubsidiaries will depend upon theiroperating results, nancial condition,capital expenditure plans and other factorsthat either respective board of directorsdeem relevant. Dividends may only bepaid out of distributable reserves.In addition, covenants in the loanagreements, if any, for the Company’ssubsidiariesmay limit their ability todeclare or paycash dividends.”

Notwithstanding the above, the payoutratios of 2012, 2013 and 2014 were 162%,170% and 175% respectively.

INVESTOR ENGAGEMENTS

The Company engages in regulardialogues with its shareholders, bothinstitutional and individual, to enablethem to exercise their rights in a fully

informed manner.

The Company is also committed tothe promotion of investor con denceby ensuring transparency in nancialreporting, timely access to informationabout Maxis’ strategic goals, materialdevelopments, governance and risk pro le.All this is to enable e cient and informedtrading in the Company’s securities.

The key spokespersons andrepresentatives for Investor Relations

of the Company are the Chief ExecutiveO cer, the Chief Financial andStrategy O cer, and the Head ofInvestor Relations.

Other Maxis’ investor-relatedengagements are described below.


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OverviewOurBusiness

StrategicReview

CorporateGovernance

FinancialStatements

OtherInformation


Investor Relations

ANNUAL GENERAL MEETING

Our annual general meetings (AGM)present an opportunity for shareholdersto discuss and raise questions related tocompany performance, plans, corporategovernance and other important matterswith the management and the Board,as appropriate.

While at every AGM, the managementteam presents a comprehensive reviewof the Company’s nancial performanceand outlines its prospects for the following

nancial year, time is set aside forshareholders’ queries. Where it is notpossible to provide replies during theAGM, the Company undertakes to provideshareholders with written replies after.

Notices of AGMs and accompanyingpapers are provided to shareholders

within the prescribed time in accordanceto the Bursa Securities ListingRequirements. These notices are lodgedwith Bursa Securities and are also placedin major local newspapers.

Maxis’ AGMs are held at a convenientlocale to allow as many shareholders aspossible to attend. Generally, the chairs ofall board committees will be available toanswer questions raised, and all directorsare expected to attend the meeting wherepossible. The Company also requires its

external auditors to attend each AGM toanswer questions on the conduct of theaudit and the preparation and content ofthe independent auditors’ report.

Copies of the review are posted on theCompany’s Investor Relations websiteafter the close of the annual generalmeetings.

QUARTERLY FINANCIAL RESULTS

Every quarter, the Company’s nancialresults are released publicly throughBursa Securities. These announcementscontain condensed consolidated nancialstatements, a summary of nancial andoperational indicators and any analysis ofperformance.

This is substantiated by a press releaseand a conference call for the investmentcommunity. All press releases andpresentation materials used in theconference call are simultaneously madeavailable on the Company’s website.

MEETINGS, CONFERENCES ANDROADSHOWS

The Company continues to attract stronginterest from both local and international

investors, and recognises the importanceof maintaining regular communicationsand building rapport with these investors.

Part of the Company’s investor-relatedinitiatives include one-on-one meetingwith investors, participation in majorinvestment conferences and engaginginvestors in non-deal roadshows coveringthe major nancial centres in Asia, Europeand the United States of America.

WEBSITE

Our corporate website has a dedicatedsection on Investor Relations whichprovides current and historical nancialdata points including announcementsto Bursa Securities, quarterly nancialresults, corporate presentations andannual reports. In addition, the Company’spress releases are uploaded in theadjacent Media Centre section ofthe website.

FEEDBACK AND ENQUIRIES

As part of the Company’s continuingcommitment to engage proactively andregularly with shareholders and the largerinvestment community, we welcomefeedback on our Investor Relationsinitiatives and information provided.

Queries, requests for publicly availableinformation, comments and suggestionsto the Company can be directed [email protected]. We look forwardto a continued engagement with ourshareholders.


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Maxis Berhad

Annual Report 2014

2011 2012 2013 2014

Dividends (RM’m) Interim 2,400 2,400 2,400 2,402

Final 600 600 600 600 Total 3,000 3,000 3,000 3,002

Dividend Per Share (sen) Interim 32.0 32.0 32.0 32.0 Final 8.0 8.0 8.0 8.0

Total 40.0 40.0 40.0 40.0

Earnings Per Share (sen) 33.7 24.7 23.5 22.9

Payout Ratio (%) 118.7 161.6 170.0 174.7

Dividend Yield (%) 7.3 6.0 5.5 5.8

Investor Relations

7.20

7.00

Last Price 6.85High on 02/01/14 7.29Average 6.77Low on 19/09/14 6.21

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

6.80

6.60

6.40

6.20

20M

10M0

6.85

8.611M

MAXIS SHARE PRICE PERFORMANCE - 1 JANUARY 2014 TO 31 DECEMBER 2014


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OverviewOurBusiness

StrategicReview

CorporateGovernance

FinancialStatements

OtherInformation


Corporate Information

BOARD OF DIRECTORSRAJA TAN SRI DATO’ SERI ARSHADBIN RAJA TUN UDAChairman/Independent Non-Executive Director

ROBERT WILLIAM BOYLEIndependent Non-Executive Director

TAN SRI MOKHZANI BIN MAHATHIRIndependent Non-Executive Director

HAMIDAH NAZIADINIndependent Non-Executive Director

KRISHNAN RAVI KUMARNon-Executive Director

FRASER MARK CURLEYNon-Executive Director

DR. IBRAHIM ABDULRAHMAN H. KADINon-Executive Director

AUGUSTUS RALPH MARSHALLNon-Executive Director

LIM GHEE KEONGNon-Executive Director

ALVIN MICHAEL HEW THAI KHEAMNon-Executive Director

MORTEN LUNDALChief Executive O cer/Executive Director

SENIOR INDEPENDENT DIRECTORTAN SRI MOKHZANI BIN MAHATHIRe-mail : [email protected]

AUDITORSPRICEWATERHOUSECOOPERSLevel 10, 1 SentralJalan TraversKuala Lumpur Sentral50470 Kuala LumpurMalaysiaTel : + 603 2173 1188Fax : + 603 2173 1288

REGISTERED OFFICEMAXIS BERHAD(Company No 867573-A)Level 21, Menara MaxisKuala Lumpur City CentreOff Jalan Ampang50088 Kuala LumpurMalaysiaTel : + 603 2330 7000Fax : + 603 2330 0590Website : www.maxis.com.my

SHARE REGISTRARSYMPHONY SHARE REGISTRARS

SDN. BHD.Level 6, Symphony HouseBlock D13, Pusat Dagangan Dana 1Jalan PJU 1A/4647301 Petaling JayaSelangorTel : + 603 7841 8000Fax : + 603 7841 8008

STOCK EXCHANGE LISTINGMAIN MARKET OF BURSA MALAYSIASECURITIES BERHADListed since 19 November 2009Stock Code : 6012

COMPANY SECRETARYDIPAK KAUR(LS 5204)

HEAD OF INTERNAL AUDITSHAFIK AZLEE MASHAR

INVESTOR RELATIONSAUDREY HO SWEE FONGTel : + 603 2330 7000Fax : + 603 2330 0555e-mail : [email protected]

ENQUIRIES/ASSISTANCE PERTAININGTO MATTERS RELATING TO THE 2014ANNUAL REPORT AND SIXTHANNUAL GENERAL MEETINGe-mail : [email protected](valid from 30 March 2015 to 28 April 2015)


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