CHAIRMAN’S STATEMENT
On behalf of the Board of Directors, I am pleased to present the Annual Report of the Group for the financial year ended 31 March 2011.
For the year under review, he overall performance of the KLCC Property Holdings Berhad (KLCCP) Group continued to be underpinned by the long term tenancies of the office segment, which acts as the stabilizing factor in the event of adversities and uncertainties in the economic and business environment. The Company’s performance is further complemented by encouraging growth in the hotel and retail segments in tandem with the 7.2% expansion of the local economy in 2010. Nevertheless, the Group realises that the long term sustainability of strong and profitable performance rests not only on revenue growth, but also on effective cost management. Hence, KLCCP Group continues the pursuit of optimum operating cost environment in matching its effort to expand the revenue pie going forward.
Based on the foregoing, it is my pleasure to announce that for the financial year ended 31 March 2011, the Group recorded increased profit after minority interests of RM706 million - a growth of 9% from the preceding year. As was the case in the previous years, fair value adjustment of RM547 million has been recognised pursuant to the adoption of FRS 140. This adjustment, however, had no impact on the Group’s cash flows.
In view of the continued strong performance of the KLCCP Group and in appreciation of the continuous support of the shareholders, the Board of Directors is recommending a final dividend of 7% per share for the financial year ended 31 March 2011 for approval by the shareholders. This will bring the total dividends for the year to 12% per share, the highest payout since the listing of the Company in 2004. This reflects the commitment of the Group in providing sustainable returns to the shareholders moving forward, after taking into consideration financial needs for future expansion as well as other operational requirements.
The current year achievement of the Group reflects our planning, development and execution of the Group’s short and long term strategies aimed to enhance value to the shareholders. That being said, the Group remains alert and vigilant of the dynamics in the economy and the business world that may have adverse impact on our performance in future years.
In pursuit of sustainable growth, it is imperative that KLCCP Group continues to introduce new assets as well as ‘sweating’ the existing ones to a level which would enhance the shareholders’ value. The commencement of operations of Lot C retail this year is expected to enhance the Group’s profitability to a certain extent. The bigger impact, however, would be felt in the financial year ending 31 December 2012 upon completion and full operations of the Lot C office tower, expected by early 2012.
The continued success of KLCCP would not be possible without the on-going support from the shareholders, customers, business associates and the relevant authorities. Therefore, on behalf of the Board of Directors, I would like to extend my appreciation to all stakeholders.
Again, on behalf of the Board of Directors, I would like to take this opportunity to extend my utmost appreciation to Tunku Tan Sri Dato’ Seri Ahmad Bin Tunku Yahaya (Tunku) and Datuk Nasarudin Md Idris for their vast contributions to KLCCP as Chairman and Director, respectively. Both Tunku and Datuk Nasarudin did not seek re-election in the last Annual General Meeting (AGM) of the Company, hence relinquishing their respective positions effective the same date. They have contributed immensely towards the development of the KLCCP Group and I wish them continued success. I look forward to working with the rest of the Board members and the Management team in steering the organisation to greater heights.
Finally, my utmost appreciation also goes to the management and staff of the KLCCP Group of Companies for their dedication, commitment and contribution to the overall achievement of the Company’s goals and objectives.
Krishnan C K Menon
Chairman