WHERE PEOPLE MATTER ANNUAL REPORT 2024
THE ANNUAL REPORT 2024 COVER EXTENDS THE “WHERE PEOPLE MATTER” THEME, HIGHLIGHTING MKH’S UNWAVERING COMMITMENT TO STAKEHOLDERS. Progress is not just about building structures; it is also about building communities. Layered in the foreground is a vibrant depiction of building spaces and our oil palm plantation that transcend architecture. Homes that hold memories, buildings that inspire ambition and communities where life flourishes. These spaces are more than physical constructs; they are expressions of care, designed to embrace the lives they hold within. WHERE PEOPLE MATTER And yet, amidst all of this, our focus remains on the people. From those shaping of the skyline to families walking in its paths, every figure in this composition reflects a deeper connection. A reminder that progress is only meaningful when it resonates with the lives it touches. With every step forward, MKH Berhad reaffirms its commitment to creating a world Where People Matter. The Heart of Our Vision COVER RATIONALE
Looking Ahead With Confidence As we navigate 2025 and beyond, MKH Berhad remains committed to sustainable growth, operational excellence and value creation for all stakeholders. Our strategic focus lies in: Strengthening our portfolio with transit-oriented developments (TODs) that address the growing demand for affordable and sustainable housing. Reporting Frameworks and Guidelines MKH Berhad’s Annual Report 2024 is prepared in accordance with Bursa Malaysia’s Main Market Listing Requirements and guided by globally recognised reporting frameworks. These include: • Global Reporting Initiative (GRI) Standards: Ensuring comprehensive and transparent sustainability reporting. • Task Force on Climate-related Financial Disclosures (TCFD): Addressing climate risks and opportunities in alignment with global best practices. • United Nations Sustainable Development Goals (UN SDGs): Contributing towards achieving global sustainability objectives. • Malaysian Code on Corporate Governance (MCCG): Reinforcing good governance and ethical business practices. ABOUT THIS REPORT Dear Stakeholders, ON BEHALF OF THE BOARD OF DIRECTORS AND MANAGEMENT, I AM DELIGHTED TO PRESENT MKH BERHAD’S ANNUAL REPORT 2024. THIS YEAR REFLECTS OUR STEADFAST COMMITMENT TO BALANCING FINANCIAL ACHIEVEMENTS WITH MEANINGFUL SOCIAL AND ENVIRONMENTAL IMPACT. Driving innovation in our Plantation Division through enhanced mechanization, digitalisation and sustainable practices, ensuring higher yields and operational efficiencies. Expanding market presence while maintaining a strong emphasis on environmental and social governance (ESG). With Malaysia’s GDP forecasted to grow between 4.5% and 5.5% in 2025, supported by domestic consumption, investments and tourism, MKH is well-positioned to capitalize on emerging opportunities. Additionally, the anticipated stability in crude palm oil (CPO) prices and continued demand for palm oil will support our Plantation Division’s contributions. • Greenhouse Gas Protocol (GHG): Measuring and managing emissions for sustainable operations. Our sustainability efforts are structured to address Economic, Environmental and Social (EES) aspects, ensuring that our reporting meets the expectations of stakeholders while promoting accountability and transparency in our operations. By embracing challenges, we delivered resilient results driven by innovation, operational excellence and a focus on sustainability. Key milestones, such as our transit-oriented developments and sustainable plantation operations, exemplify our ability to create value for our stakeholders while addressing evolving market needs. Looking ahead, we are committed to fostering sustainable growth, enhancing community well-being and leveraging opportunities to strengthen our leadership across industries. These achievements are made possible through the unwavering support of our shareholders, employees and business associates. Thank you for your trust as we continue to forge a sustainable future for our businesses, communities and the environment.
Scope and Boundaries This Annual Report provides a comprehensive overview of MKH Berhad’s financial, operational and sustainability performance for the financial year ended 30 September 2024. The scope of this report includes: • Coverage: All business segments, including Property Development and Construction, Plantation, Hotel and Property Investment and others such as building materials trading and manufacturing. • Geographic Focus: Operations in Malaysia and East Kalimantan, Indonesia. • Content Inclusion: Financial disclosures, sustainability initiatives, governance practices and key material matters that influence our strategy and decision-making. The data and information presented aligns with Bursa Malaysia’s Sustainability Reporting Guide and other global frameworks. Any limitations or exclusions are stated to maintain transparency.
Guided by Leadership, Inspired by People Chairman’s Statement Our Directors’ Profile Profile of Key Senior Management GUIDING YOU THROUGH Laying the Foundation of Excellence Where People Matter About this Report The Heart of Our Vision Vision and Mission Core Values Our Corporate Milestone Awards and Achievements Our Company Profile 5 Years Group Financial Highlights Financial Highlights Our Key Non-Financial Highlights 8 10 12 14 16 20 22 24 28 34 40 Delivering Value That Matters to People Sustaining Lives, Empowering Communities Management Discussion and Analysis Corporate Structure Corporate Information Sustainability Framework Sustainability Report 62 64 44 56 58
WHAT MATTERS Governance That Inspires Confidence Corporate Governance Overview Statement Audit Committee Report Statement on Risk Management and Internal Control Additional Compliance Information Financial Insights Through Numbers Empowering Ownership Directors’ Report Statement by Directors Statutory Declaration Independent Auditors’ Report Statements of Profit or Loss and Other Comprehensive Income Statements of Financial Position Consolidated Statement of Changes in Equity Statement of Changes in Equity Statements of Cash Flows Notes to the Financial Statements List of Properties Analysis of Shareholdings Directors’ Shareholdings Notice of 45th Annual General Meeting Statement Accompanying Notice of 45th Annual General Meeting Form of Proxy 118 137 142 148 152 160 160 161 166 168 170 172 173 180 312 320 323 324 329 This Annual Report 2024 is available at www.mkhberhad.com 45th Annual General Meeting Will be held at RHR Hotel @ Kajang and details as follows : Date : 20 March 2025 Time : 10.00 a.m. Venue : Emerald Ballroom, 1st Floor RHR Hotel @ Kajang Jalan Semenyih 43000 Kajang Selangor Darul Ehsan Malaysia
LAYING THE FOUNDATION OF EXCELLENCE WHERE PEOPLE MATTER
Vision and Mission Core Values Our Corporate Milestone Awards and Achievements Our Company Profile 5 Years Group Financial Highlights Financial Highlights Our Key Non-Financial Highlights 8 10 12 14 16 20 22 24
OUR WHO WE ARE, WHAT WE DO To lead the market by continually developing and innovating quality products and projects that meet and exceed market expectations. To be responsive to market trends and customer needs. To provide conducive working environment that will encourage the application of creative energy that is guided by best industry practices. To be a good and responsible corporate citizen. To provide sustainable return to shareholders. PG. 9 Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership
STABLE We use our expertise, business acumen and financial resources to provide a holistic value to all stakeholders and customers. DYNAMIC We are always enthusiastic in looking out for new opportunities and delivering innovative products into the market. RESPONSIVE We proactively engage with the community to understand their needs and concerns with the aim of delivering solutions for betterment of the situations. FRIENDLY We greet our colleagues, customers and stakeholders in an approachable manner with a smile and are considerate for each other’s feeling. RELIABLE We utilize our experience and financial strength to deliver on our promises and complete all projects on time or earlier. PROFESSIONAL We deal with our stakeholders and customers in an efficient, knowledgeable and responsive manner. PG. 11 Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership
Moments That Matter • E stablished Furniture Manufacturing Division in China: Vast Furniture Manufacturing (Kunshan) Co. Ltd • Established oil palm plantation division • Acquired PT Maju Kalimantan Hadapan • Metro Kajang Holdings Berhad rebranded: MKH Berhad • MKH Oil Palm (East Kalimantan) Berhad was successfully listed on the Main Market of Bursa Malaysia Securities Berhad on 30 April 2024. • Completion of the 90MT per day crude palm kernel oil (CPKO) mill • Metro Kajang Trading Sdn. Bhd. rebranded: MKH Building Materials Sdn. Bhd. • Built second shopping complex in Kajang: Metro Point Complex 2024 2007 2000 2008 2011 2014 Our Corporate Milestone PG. 12 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People MKH BERHAD ANNUAL REPORT 2024
• E stablished property investment division • Bulit first shopping complex in Kajang: Plaza Metro Kajang • PT Maju Kalimantan Hadapan received Gold Award for Best Foreign Owned Company • PT Maju Kalimantan Hadapan received the “GREEN” rating under the Company Rating Performance Assessment Program in Environmental Management for year 2022 – 2023 • PT Maju Kalimantan Hadapan achieved Indonesian Sustainable Palm Oil certification • PT Sawit Prima Sakti achieved Indonesia Sustainable Palm Oil certification • Established as private limited company: Srijang Bena Sdn. Bhd. • Built first landed residential development: Taman Bukit Indah • Established building materials trading division: Metro Kajang Trading Sdn. Bhd. • Built first joint venture development with Selangor state government: Bandar Teknologi Kajang • Built first high-rise development in Kajang • Srijang Bena Sdn. Bhd. rebranded: Metro Kajang Holdings Berhad • Officially listed on Bursa Malaysia as “MKH” under stock code “6114” 1979 1983 1993 2022 2023 1994 1995 2017 2020 PG. 13 Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership
Recognising Excellence AWARDS AND PROPERTY In FY2024, MKH ranked 12th among Top 30 Property Developers in Malaysia at The Edge Malaysia Top Property Developers Awards 2024. MKH focus on transitoriented development projects that create value for our home buyers and investors. PLANTATION Our subsidiary, MKH Oil Palm (East Kalimantan) Berhad was successfully listed on the Main Market of Bursa Malaysia Securities Berhad on 30 April 2024. • PT MAJU KALIMANTAN HADAPAN (PTMKH) - Received the “GREEN” rating under the Company Rating Performance Assessment Program in Environmental Management for the year 2023 – 2024 on good environmental management. - Zero Accident Award in Implementing Safety and Health Programmes in achieving 66,350,794 man-hours without work-related accidents from 1 June 2017 to 1 December 2023. • PT SAWIT PRIMA SAKTI (PTSPS) - Zero Accident Award in Implementing Safety and Health Programmes in achieving 13,000,920 man-hours without work-related accidents from 1 January 2015 to 1 December 2023. Our Awards and Achievements PG. 14 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People MKH BERHAD ANNUAL REPORT 2024
FY2024 Achieved Group Revenue of RM1,060.9 million & Achieved Profit Before Tax of RM144.7 million Top 12th Developer in Malaysia during the The Edge Malaysia Top Property Developers Awards 2024 165 students from 33 schools in Hulu Langat district benefited financially on their education needs Contributed approximately RM1,689,153 through community engagement that supported beneficiaries in Malaysia and Indonesia which included education institutions, local communities and non-profit organizations Enhanced the Plantation & Mill Management system (PMMS) Apps to track evacuation of FFB from field to the mill, fertilizer application, harvesting interval and monitor contractors’ trucks for more efficient FFB crop evacuation Our subsidiary, MKH Oil Palm (East Kalimantan) Berhad was successfully listed on the Main Market of Bursa Malaysia Securities Berhad PG. 15 Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership
MKH Berhad is a diversified property developer based in Malaysia, with business operations across the Klang Valley, as well as in East Kalimantan, Indonesia and China. Expanded into building materials trading, property investment and furniture manufacturing. Diversified into oil palm plantation in recognition of its sustainability. Who We Are, Who We Serve As a prominent property developer, MKH has been instrumental in transforming Kajang, offering a diverse property portfolio that includes meticulously planned Transit Oriented Developments (TOD), thriving townships and integrated high-rise buildings across the Klang Valley. Our commitment to growth and creating sustainable value for all stakeholders led us to diversify in 2008, venturing into oil palm cultivation in East Kalimantan, Indonesia. Beyond real estate and oil palm cultivation, the MKH Group is also involved in property investment, building materials trading and furniture manufacturing. In our pursuit of value creation for our homeowners, MKH consistently explores innovative approaches to elevate living standards. Our properties incorporate eco-friendly features and numerous are strategically located near KTM commuter or MRT stations for enhanced convenience and accessibility. We specialise in crafting homes designed for multi-generational living, ensuring that families can thrive in comfortable and adaptable spaces. WE BUILD HOMES, WE BUILD COMMUNITIES. FOUNDED IN 1979, MKH BERHAD (MKH) IS A PUBLIC LISTED MALAYSIAN COMPANY WITH ITS ROOTS IN KAJANG, SELANGOR. OVER THE YEARS, MKH HAS CULTIVATED A STRONG AND RECOGNISABLE BRAND PRESENCE IN SELANGOR, KUALA LUMPUR AND EAST KALIMANTAN, INDONESIA. Our Company Profile PG. 16 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People MKH BERHAD ANNUAL REPORT 2024
Core Business PROPERTY DEVELOPMENT PROPERTY INVESTMENT BUILDING MATERIALS TRADING OIL PALM PLANTATION • Our oil palm plantation division is one of the main contributors to the Group’s earnings. • Comprising mainly two oil palm estates, namely PT Maju Kalimantan Hadapan (PT MKH) and PT Sawit Prima Sakti (PT SPS), we produce and sell quality ISPO-certified crude palm oil (CPO) as well as palm kernel (PK) and crude palm kernel oil (CPKO) at our 18,205-hectare (44,986 acres) plantation in East Kalimantan, Indonesia. • Own and manage various commercial properties located in Kajang and across the Klang Valley that are designed and built to elevate quality of life for the greater community. • Besides commercial malls, retail outlets, shop-offices, parking spaces and a 6-storey hotel, we also own land and factory buildings in China which are currently used for furniture manufacturing. • Supply building materials to developers and contractors. • A well-established and distinguished property developer in the Klang Valley. • Developed strategically located properties across the Klang Valley. • Ranked 12 among Top 30 Property Developers in Malaysia at The Edge Malaysia Top Property Developers Award 2024. PG. 17 Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership
MKH’s oil palm cultivation efforts extend across two estates in East Kalimantan, managed under PT Maju Kalimantan Hadapan (PT MKH) and PT Sawit Prima Sakti (PT SPS). These estates collectively cover approximately 18,205 hectares (equivalent to 44,986 acres) and operate a 90 metric tonnes (MT) per hour crude palm oil (CPO) mill, a 90 MT per day crude palm kernel oil (CPKO) mill and a jetty. Notably, our estates have consistently demonstrated strong performance, with fresh fruit bunches (FFB) yields averaging between 24 MT to 30 MT per hectare annually. For the financial year 2024 (FY2024), our CPO production reached a commendable 91,635 MT. In a significant milestone, our subsidiary MKH Oil Palm (East Kalimantan) Bhd (MKHOP) was listed on the Main Market of Bursa Malaysia Securities Berhad on 30 April 2024. This listing marks a pivotal step in unlocking the full potential of our investment in MKHOP and enhancing shareholders’ value. The initial public offering (IPO) comprised a public issue of 220 million new MKHOP shares, representing 21.5% of its enlarged share capital, which raised RM136.4 million and offer for sale of 30,707,700 MKHOP shares by way of private placement to selected investors which raised approximately RM19.04 million. The majority of the IPO proceeds will be used to expand our oil palm plantation business and optimize fresh fruit bunch harvesting and palm oil milling activities. Additionally, the strategic location of our estates within a 100-kilometer radius of Nusantara, the new capital city of Indonesia, places MKHOP in an advantageous position to leverage on future growth opportunities. This IPO listing provides MKHOP with the added resources and flexibility to expand its oil palm plantation in East Kalimantan, Indonesia. Our property investment division established in 1996, proudly anchors two eco conscious shopping malls, Plaza Metro Kajang and Metro Point Complex. Located in the heart of Kajang town, these malls have embraced a forward looking approach by integrating solar energy solutions. This green initiative not only significantly reduces electricity costs but also underscores our commitment to environmental responsibility. The installation of solar panels represents a strategic, long-term investment that yields substantial benefits for both our company and environment. Plaza Metro Kajang and Metro Point Complex furthered our sustainability efforts by installing Electric Vehicle (EV) charging stations for our customers. This initiative aligns with our dedication to fostering a more sustainable and environmentally friendly future. Our estates have consistently demonstrated strong performance, with FFB yields averaging between 24 MT to 30 MT per hectare annually. For FY2024, our CPO production reached a commendable 91,635 MT. This IPO listing provides MKHOP with the added resources and flexibility to expand its oil palm plantation in East Kalimantan, Indonesia. In a significant milestone, our subsidiary, MKH Oil Palm (East Kalimantan) Bhd was listed on the Main Market of Bursa Malaysia Securities Berhad on 30 April 2024. 91,635 MT Our Company Profile PG. 18 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People MKH BERHAD ANNUAL REPORT 2024
Our malls have evolved into vibrant community hubs, offering shopping, leisure and dining options while reflecting our unwavering commitment to a sustainable and eco-conscious future. These green investments highlight our proactive approach to sustainability, ensuring that we contribute positively to the environment and align with our Group’s long-term sustainability goals. MKH Building Materials Sdn. Bhd. traces its beginnings back over 40 years ago when it served as a purchasing division for the MKH Group. Its primary purpose is to support in-house and external projects. It has firmly established itself as the key purchasing arm for building materials for the Group. We achieve this by continuously developing and innovating quality products that not only meet but exceed market expectations and remain responsive to market trends and customer needs, guided by the best industry practices. At MKH, we are wholeheartedly committed to nurturing enduring relationships with our stakeholders and the larger community towards a sustainable future. PG. 19 Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership
Strength Through the Years 5 Years Group Financial Highlights 2024 RM’000 2023 RM’000 2022 RM’000 2021 RM’000 2020 RM’000 INCOME STATEMENT Revenue 1,060,881 1,063,796 968,126 913,572 911,926 Profit Before Taxation 144,661 117,197 171,254 161,054 116,476 Profit After Taxation 101,902 81,278 128,747 102,708 66,267 Profit Attributable to Shareholders of the Company 76,118 74,596 112,413 80,435 41,737 BALANCE SHEET Issued and Paid up Capital 654,459 654,459 654,459 654,459 654,459 Shareholders’ Equity 1,826,111 1,860,686 1,807,541 1,706,069 1,632,609 RATIOS Single Tier Dividend Per Share (sen) 4.00 4.00 4.00 3.50 3.00 @ Net Earnings Per Share (sen) 13.18 12.92 19.47 13.93 7.22 Net Assets Per Share (RM) 3.16 3.22 3.13 2.95 2.83 Debt/Equity Ratio (%) 24.9 20.4 23.3 32.2 40.0 Return on Shareholders’ Equity (%) 4.2 4.0 6.2 4.7 2.6 @ Attributable to the equity holders of the Company PG. 20 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People MKH BERHAD ANNUAL REPORT 2024
Our Numbers, Our People Revenue: RM1,060.9 million (FY2023: RM1,063.8 million) Dividend per share: Net Earnings per share: Debt/Equity Ratio: Return on Shareholder Equity: 4.0 sen (FY2023: 4.0 sen) Profit Attributable to Shareholders of the Company RM76.1 million (FY2023: RM74.6 million) Net Assets per Share: RM3.16 (FY2023: RM3.22) 13.18 sen (FY2023: 12.92 sen) 24.9% (FY2023: 20.4%) 4.2% (FY2023: 4.0%) We are a well established property developer and we incorporate eco-friendly, affordable and practical homes in our development projects. This division represents one of the group’s contributors that maintain an average annual rental yield of 3% to 4% from various commercial properties located in Kajang and across the Klang Valley. Plaza Metro Kajang and Metro Point Complex (more than 98% tenanted) offer an extensive range of leisure and eatery conveniences for more than 230,000 Kajang residence. Besides retail outlets, shop-offices, parking spaces and a 6-storey hotel, we also own factory buildings in China which are currently used for furniture manufacturing and rental. Property Development & Construction Hotel and Property Investment 28% Total Segment Profit Before Tax Contribution 13% Total Segment Profit Before Tax Contribution BUSINESS HIGHLIGHTS 3.0% Contribution To Total Group Revenue 55% Contribution To Total Group Revenue Established in 2008, this division is one of the main contributors to the group’s earnings. The Group has 18,205 hectares (44,986 acres) of plantation land in East Kalimantan, about 75km from Kota Samarinda, Indonesia. Oil Palm Plantation 57% Total Segment Profit Before Tax Contribution 33% Contribution To Total Group Revenue Financial Highlights Profit Before Tax: RM144.7 million (FY2023: RM117.2 million) PG. 22 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People MKH BERHAD ANNUAL REPORT 2024
KUALA LUMPUR INTERNATIONAL AIRPORT (KLIA) JAKARTA SOAKARNO-HATTTA INTERNATIONAL AIRPORT SINGAPORE CHANGI INTERNATIONAL AIRPORT BALIKPAPAN INTERNATIONAL AIRPORT 2 hours 35 minutes 3 hours 2 hours 10 minutes 2.5 Days SAMARINDA IKN NUSANTARA 1.5 Days TUAS PORT TANJUNG PRIOK PORT BALIKPAPAN PORT PENINSULAR MALAYSIA SARAWAK SABAH EAST KALIMANTAN GREEN INDUSTRIAL PARK PT.MKH JETTY PORT BONTANG BALIKPAPAN INTERNATIONAL AIRPORT PORT BALIKPAPAN SAMARINDA AIRPORT PT.MKH NEW CAPITAL OF INDONESIA NUSANTARA 50KM 100KM !"#$%&' PT.SPS Easy accessibility to our plantation via direct flight from Kuala Lumpur, Singapore or Jakarta to Balikpapan International Airport in East Kalimantan, Indonesia Our Plantation (highlight in pink) is located in prime area within the vicinity of Nusantara, the new capital city of Indonesia in East Kalimantan PG. 23 Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership
Creating Value Beyond Numbers SUSTAINABILITY REPORT 2024 Our Key Non-Financial Highlights Support and contribute to the well-being of underserved communities. PT Maju Kalimantan Hadapan, our subsidiary received the ‘Green Rating’ in Company Rating Performance Assessment Program in Environmental Management. This encompasses the adoption of a zero-burning policy for planting of oil palm trees and the display of various signboards pertaining to environmental preservation and wildlife protection. Environmental and social related matters remain as a key strategic focus for MKH. PG. 24 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People MKH BERHAD ANNUAL REPORT 2024
GUIDED BY LEADERSHIP INSPIRED BY PEOPLE
Chairman’s Statement Our Directors’ Profile Profile of Key Senior Management 28 34 40 Artist’s impression of the Gaya Residency swimming pool area
A Message to Our People ON BEHALF OF THE BOARD OF DIRECTORS AND THE MANAGEMENT, IT IS MY GREAT PLEASURE TO PRESENT TO YOU THE ANNUAL REPORT OF MKH BERHAD (“MKH” OR “THE GROUP”) FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2024 (FY2024). DEAR SHAREHOLDERS, We are committed to making positive impact and we prioritise not only financial achievements but also social and environmental considerations in the decisions that we make. With this approach, we create thriving sustainable businesses that contributes positively to the Group, the society and environment. It has been another remarkable year for MKH, which is reflected in our financial performance and the successful listing of our subsidiary, MKH Oil Palm (East Kalimantan) Berhad (MKHOP) on the Main Market of Bursa Malaysia Securities Berhad. Revenue Profit before tax For FY2024, the Group achieved a commendable revenue of RM1.06 billion and a profit before tax (PBT) of RM144.7 million. These achievements were made possible through strategic alignment of our vision and objectives, a strong commitment to sustainable growth and a steadfast focus on operational excellence. For a more in-depth review of the Group’s performance, please refer to the “Management Discussion and Analysis Report” in this Annual Report. RM1.06 billion RM144.7 million Chairman’s Statement PG. 28 MKH BERHAD ANNUAL REPORT 2024 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People
The Group continue to focus on the strong demand for affordable housing, with emphasis on Transit-Oriented Development (TOD) in prime locations together with appropriate product mix. For FY2024, the Property Development and Construction Division recorded a revenue of RM580.0 million and PBT of RM40.8 million. In response to the strong interest in TOD, MKH has been actively engaged in the development of TOD projects strategically situated along the Klang Valley transit system. Some of our noteworthy service apartment projects in this category include Nexus @ Taman Pertama in Cheras, Residensi Naluri in Mahkota Cheras, MKH Boulevard II in Kajang, Nexus @ Kajang Station, MIRAI Residences @ Kajang 2 Precinct 1, Gaya Residency in Kajang and TR2 Residence @ Jalan Tun Razak in Kuala Lumpur. MKH Boulevard II, a transit-oriented development (TOD) located right next to the Kajang Line MRT Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership PG. 29
The Group has locked-in unbilled sales value of RM547.3 million from which attributable sales revenue and profits will be recognised progressively RM547.3 million To extend our market presence and strengthen engagement with prospective buyers, the Group has conducted exciting marketing campaigns across digital and social media platforms. Among these initiatives was the “MKH Great Home Great Deal” campaign from May 2024 till September 2024. This campaign offered attractive incentives for our projects, including Nexus @ Taman Pertama, Residensi Naluri in Mahkota Cheras, MIRAI Residences @ Kajang 2 Precinct 1, Akina @ Kajang 2 Precinct 3 and Gaya Residency in Kajang. This campaign not only amplifies our reach but also provides attractive incentives for our valued customers. It marks another step in our commitment in delivering exceptional value and experiences. As at 30 September 2024, the Group has locked-in unbilled sales value of RM547.3 million from which attributable sales revenue and profits will be recognised progressively. For FY2024, the Plantation Division recorded an impressive revenue of RM352.2 million and PBT of RM82.0 million. The Plantation Division recorded an impressive revenue of RM352.2 million and PBT of RM82.0 million RM352.2 million Artist’s impression of the Purple Garden at Gaya Residency, featuring a charming treehouse, and relaxing reflexology path Chairman’s Statement PG. 30 MKH BERHAD ANNUAL REPORT 2024 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People
Recognising the importance of innovation in creating value for our businesses, our oil palm plantation in East Kalimantan, Indonesia continue to enhance the usage of mechanical assisted fresh fruit bunches (FFB) collection and drones to monitor palm growth, palm census and water flow management. The Plantation Division updated PMMS Apps tracks FFB evacuation from field to mill, fertiliser application, harvesting interval and monitor contractors’ trucks, optimising FFB crop evacuation efficiency. These measures contribute to efficient estate management and enable us to maximise CPO production and operational efficiency. The Indonesia’s new administrative capital, Nusantara, in East Kalimantan signifies a positive development for the region where our oil palm plantation is located. Businesses are well positioned to benefit from the increased economic activities, job creation and improved infrastructure associated with this new capital. As a responsible corporate citizen, MKH places a strong emphasis on Corporate Social Responsibility (CSR). For FY2024, the Group contributed approximately RM1.7 million in community engagement initiatives in Malaysia and Indonesia benefiting educational institutions, local communities and charitable organisations. For a comprehensive overview of MKH’s sustainability efforts, please refer to the “Sustainability Report” in this Annual Report, from page 64 to page 114. Aeriel view of our oil palm plantation in East Kalimantan, Indonesia Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership PG. 31
The current CPO price trading at approximately RM3,800 to RM4,000 per MT (net of export levy and duty) in Indonesia, augurs well for our Plantation Division RM3,800 to RM4,000 per MT For FY2024, a first interim dividend of 4 sen per ordinary share, totalling approximately RM23.1 million, was declared on 28 November 2024 and paid on 10 January 2025 RM23.1 million For FY2024, a first interim dividend of 4 sen per ordinary share, totalling approximately RM23.1 million, was declared on 28 November 2024 and paid on 10 January 2025. This dividend distribution represents around 30.3% of the Group’s net profit attributable to owners of the parent. Malaysia’s gross domestic product (GDP) is expected to grow within the range of 4.5% to 5.5% in 2025 after registering a 5.2% growth for the first nine months of 2024, to be driven by favourable labour market conditions, investment projects, domestic consumption and tourism. Chairman’s Statement We are confident that our strategy of offering affordable housing in prime locations with TOD concept will continue to receive strong demand. We are optimistic that CPO price will remain well supported in 2025 due to ongoing strong demand for palm oil and tighter global supply with the current CPO price trading at approximately RM3,800 to RM4,000 per MT (net of export levy and duty) in Indonesia, which augurs well for our Plantation Division. MKH Bowling Tournament 2024, being part of our Company’s initiative to foster engagement and active lifestyle among colleagues PG. 32 MKH BERHAD ANNUAL REPORT 2024 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People
Our Chairman Tan Sri Dato’ Alex Chen Kooi Chiew (fifth from right) & our Managing Director Tan Sri Datuk Eddy Chen Lok Loi (fifth from left) during MKH Oil Palm (East Kalimantan) Berhad debut on the Main Market of Bursa Malaysia Securities Berhad. On behalf of the Board of Directors, I wish to express our sincere appreciation and gratitude to our esteemed shareholders, loyal customers, dedicated bankers, valued business associates and the authorities for their unwavering support of the Group. I also extend my heartfelt appreciation to my fellow Board members, the dedicated management team and all our employees, whose unwavering commitment and hard work have been instrumental to the Group’s success. I firmly believe that MKH Berhad is well-positioned to achieve great success in 2025, thanks to the continued support and collaboration of all our stakeholders, management and staff. Together, we look forward to another year of growth and prosperity. Thank you. Tan Sri Dato’ Alex Chen Kooi Chiew Group Executive Chairman Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership PG. 33
Leadership That Empowers OUR Group Executive Chairman TAN SRI DATO’ CHEN KOOI CHIEW @ CHENG NGI CHONG Tan Sri Dato’ Chen Kooi Chiew @ Cheng Ngi Chong serves as the Group Executive Chairman since 30 October 2006. He was appointed to the Board on 27 September 1979 and is also a member of the Executive Committee as well as a Non-Independent Non-Executive Chairman of MKH Oil Palm (East Kalimantan) Berhad and a Director of Intelek Murni (M) Berhad, both of which are subsidiaries of MKH Berhad. Other than real estate and property development, he has successfully led the Group to establish and develop oil palm plantation as one of MKH’s present core businesses. To-date, he has been involved in 81 Years Old Malaysian Male business for about 64 years, of which 46 years were in property development and construction industry and 32 years were in plantation sector. In recognition of his vast knowledge and experience in the business industry, he was the recipient of “The Great Asean Entrepreneur Award 2024”, “World Chinese Economic Summit Lifetime Achievement Award 2017” and “The International Real Estate Federation (FIABCI) Malaysia Property Man of the Year 2013”. Since July 2022, he has been the Honorary President of the Malaysia-China Chamber of Commerce. He is generous in supporting community and educational causes. He holds the positions of Chairman for Hulu Langat Chinese Industry & Commerce Association, Chairman for School Board of SMJK Yu Hua and Chairman for School Building Committee SMJK Yu Hua Kajang (2). Tan Sri Dato’ Chen Kooi Chiew @ Cheng Ngi Chong is the brother of Tan Sri Datuk Chen Lok Loi and Datuk Chen Fook Wah. He has no conflict of interest with the Company or its subsidiaries. Our Directors’ Profile Age: PG. 34 MKH BERHAD ANNUAL REPORT 2024 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People
PROFILE TAN SRI DATUK CHEN LOK LOI Group Managing Director Tan Sri Datuk Chen Lok Loi holds a Bachelor of Business (Marketing) from Monash University, Australia. He was appointed to the Board on 31 July 1984 and holding the present position as Group Managing Director since 19 January 2005. He is also a member of the Executive Committee as well as a Non-Independent Non-Executive Director of MKH Oil Palm (East Kalimantan) Berhad and a Director of GK Resort Berhad and Intelek Murni (M) Berhad, all of which are subsidiaries of MKH Berhad. He is the recipient of “The Edge Malaysia Outstanding Contribution to the Real Estate Industry 2024 Award”, “The Edge Malaysia Outstanding Property CEO Award 2018”, “CIDB’s Malaysian Construction 72 Years Old Malaysian Male Industry Excellence Awards 2015 - CEO of The Year”, “Greentech Malaysia Top 30 Green Catalysts Award 2014” and “Real Estate and Housing Developers’ Association (REHDA) Personality Award 2013”. He has 43 years of experience in property development and construction related businesses and is the past Chairman of Perbadanan PR1MA Malaysia. He is a patron of REHDA Malaysia and the industry advisor for Master of Business Administration (Building Management) Programme in Universiti Tunku Abdul Rahman and also the President of Building Management Association of Malaysia (2021-2022), EXCO member of the Malaysia Crime Prevention Foundation as well as the Board Advisors for Malaysia Shopping Malls Association (2018-2022). As an advocate of healthy living, he is also the President of the Race Walkers’ Association of Malaysia and past Captain of the Royal Selangor Golf Club. He was an active committee member in various governmentprivate sector organisations that formulate policies governing the housing and real estate industry such as Advisory Council Member of Construction Labour Exchange Centre Berhad, PEMUDAH Special Task Force on Kuala Lumpur City Hall and CIDB Pemandu Pembangunan Pelan Induk Industri Pembinaan 2 (2016-2020). Tan Sri Datuk Chen Lok Loi is the brother of Tan Sri Dato’ Chen Kooi Chiew @ Cheng Ngi Chong and Datuk Chen Fook Wah. He has no conflict of interest with the Company or its subsidiaries. Age: Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership PG. 35
Deputy Managing Director Senior Independent Non-Executive Director DATUK CHEN FOOK WAH DATO’ LIM HONG SHUAN Datuk Chen Fook Wah holds a Master of Business Administration from University of Wales, United Kingdom. He was appointed to the Board on 25 November 1999 and holding the present position as Deputy Managing Director since 19 January 2005. He is currently a member of the Executive Committee and also a Director of GK Resort Berhad, Dato’ Lim Hong Shuan was appointed to the Board on 21 May 2021 and re-designated as the Senior Independent Non-Executive Director to the Board on 26 May 2023. He is also the Chairman of the Nomination Committee and Remuneration Committee as well as a member of the Audit Committee. He holds a Bachelor of Arts (Hons) from University of Malaya; Masters of Arts in Criminology from University of Hull, England; Bachelor of Law (LLB) Hons from University of London and has obtained the Certificate in Legal Practice from the Legal Profession Qualifying Board Malaysia. He started his career 68 Years Old 65 Years Old Malaysian Malaysian Male Male a subsidiary of MKH Berhad. He was admitted to the Board of Valuers and Real Estate Agent of Malaysia in 1986. Prior to joining the Group, he was with Guthrie Trading Sdn. Bhd. from 1973 to 1974 and Hilton Realty from 1975 to 1978. in 1985 with the Royal Malaysia Police (RMP) as Assistant Superintendent of Police and with 35 years working experiences in various departments of the RMP, including Commercial Crime Investigation, Narcotics Crime Investigation, Management and Training. He was promoted and held several senior positions in the RMP and retired as Deputy Chief Police Officer of Perak, with the rank of Deputy Commissioner of Police in 2020. He is currently the Independent Non-Executive Director of LB Aluminium Berhad, Senior Associate of a legal firm and Security Advisor of another public listed company in Malaysia. He is the brother of Tan Sri Dato’ Chen Kooi Chiew @ Cheng Ngi Chong and Tan Sri Datuk Chen Lok Loi. He has no conflict of interest with the Company or its subsidiaries. He also participates actively in community and sport causes. Among others, Committee Member of Malaysia-China Friendship And Mutual Aid Association (MCFMAA), Council Member of Majlis Sukan Wilayah Persekutuan (MSWP) and Deputy President of Federation of Wushu Kuala Lumpur. He does not have any family relationship with any other Directors and/or major shareholders of the Company and has no conflict of interest with the Company or its subsidiaries. Our Directors’ Profile Age: Age: PG. 36 MKH BERHAD ANNUAL REPORT 2024 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People
Independent Non-Executive Director MS. HOON SHAT MEI Ms. Hoon Shat Mei was appointed to the Board on 1 June 2022. She is also the Chairperson of the Audit Committee and a member of the Nomination Committee. She holds a Bachelor of Arts (Hons) in Accounting and Finance from Oxford Brookes University, United Kingdom. She is currently a member of the Association of Chartered Certified Accountants (ACCA). She has more than 28 years of working experience in financial roles. She started her career with Leighton Contractors (M) Sdn. Bhd. as an Accounting Manager in 1996 and later joined Baker Hughes (M) Sdn. Bhd. 58 Years Old Malaysian as Senior Finance Manager in 2001. In 2007, she joined Smith International Sdn. Bhd. as an Entity Controller, responsible in overseeing the preparation and timely submission of all financial and management reports. She joined Spie Oil & Gas ASP Sdn. Bhd. in 2010 as the Financial Controller for the Asia Pacific Region, responsible for providing financial support, internal and external audit compliance and advice, perform analysis of results and financial reporting function of the group. In 2016, she joined Serimax Welding Services (M) Sdn. Bhd. as the Regional Financial Controller, heading the financial and accounting team based in Malaysia with operation across three countries namely in Malaysia, Australia and Singapore. In 2019, she joined S&J Global Management Services as the Director and Financial Planner providing financial plans to clients. She does not have any family relationship with any other Directors and/or major shareholders of the Company and has no conflict of interest with the Company or its subsidiaries. Female Independent Non-Executive Director MS. LEE PEI YEE Ms. Lee Pei Yee was appointed to the Board on 1 June 2023. She is a member of the Audit Committee and Remuneration Committee. She has more than 26 years of experience in financial reporting and regulatory compliance and she has been involved in various financial related activities such as merger & acquisition, restructuring and group tax optimisation. 49 Years Old Malaysian She began her career in Ernst & Young (Public Accountant) more than two decades ago and she has held senior financial position in regional roles for corporations across Asia. She is a Fellow Member of the Association of Chartered Certified Accountants (FCCA) and also a member of The Malaysian Institute of Accountants (MIA). She does not have any family relationship with any other Directors and/or major shareholders of the Company and has no conflict of interest with the Company or its subsidiaries. Female Age: Age: Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership PG. 37
Non-Independent Non-Executive Director EN. JEFFREY BIN BOSRA En. Jeffrey bin Bosra was appointed to the Board on 1 August 2008. On 9 March 2022, he was re-designated as Non-Independent Non-Executive Director to the Board. He is also a member of the Audit Committee. He is currently a member of The Malaysian Institute of Certified Public Accountants (MICPA) and The Malaysian Institute of Accountants (MIA). He started his professional career with Arthur Andersen & Co. focusing 56 Years Old Malaysian Male on external audits and business advisory works. He later joined an established commercial group as the Finance Manager from 1996 to 2000. He then joined Ernst & Young as the Senior Manager specialising in corporate governance, risk management, internal audits, special investigation and turnaround management related service. He left Ernst & Young in 2004 and started his own audit firm. He does not have any family relationship with any other Directors and/or major shareholders of the Company and has no conflict of interest with the Company or its subsidiaries. Our Directors’ Profile Age: PG. 38 MKH BERHAD ANNUAL REPORT 2024 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People
Additional Information: 1. Save as disclosed in the profile of Directors, Tan Sri Dato’ Chen Kooi Chiew @ Cheng Ngi Chong, Tan Sri Datuk Chen Lok Loi, Datuk Chen Fook Wah and Dato’ Lim Hong Shuan have no other directorship in public companies and listed issuers. 2. Save for Tan Sri Dato’ Chen Kooi Chiew @ Cheng Ngi Chong, Tan Sri Datuk Chen Lok Loi and Datuk Chen Fook Wah, none of the other Directors have any family relationship with any Director and/or major shareholder of the Company. 3. N one of the Directors have: (i) any conflict of interest with the Company or its subsidiaries; (ii) been convicted of any offence (other than traffic offences, if any) within the past 5 years; and (iii) been imposed with any public sanction or penalty imposed by the relevant regulatory bodies during the financial year. 4. Details of the Directors’ attendance at Board meetings are set out in the Corporate Governance Overview Statement on page 127. Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership PG. 39
The Team Behind the Vision Property Director Deputy Property Director Chief Financial Officer DATO’ CHONG YONG HAN DATO’ CHEN WAY KIAN MS. KOK SIEW YIN He was appointed as a Property Manager in Property Development Department of MKH Berhad and was later promoted to General Manager of Property Department in December 2002, Group Senior General Manager in April 2007 and Property Director in March 2013. He graduated from Lincoln University, New Zealand with Bachelor of Commerce (Valuation and Property Management) in year 1994 and obtained his MBA (Real Estate) in year 2000 from University of Western Sydney, Australia. He has more than 23 years of experience in property development and construction related businesses. He specialises in development planning and marketing. He holds a Bachelor of Business from University of Technology, Sydney. He joined MKH Berhad in 2005 and has been appointed as the Deputy Property Director of MKH Berhad on March 2015. Prior to his appointment to the present position, he was the Special Assistant to the Group Executive Chairman since 2011. He has been in the property development and construction related businesses as well as agricultural sectors for more than 17 years. He is the son of Tan Sri Dato’ Chen Kooi Chiew @ Cheng Ngi Chong and the nephew of Tan Sri Datuk Chen Lok Loi and Datuk Chen Fook Wah who are members of the Board of the Company. She is a fellow member of the Association of Chartered Certified Accountants (FCCA) and a member of the Malaysian Institute of Accountants (MIA). She is the Chief Financial Officer for MKH Berhad group of companies. She has more than 20 years of accounting and audit experience in property development, construction, hotels, retail, manufacturing and timber plantation industry. She was also involved in corporate advisory and has experience in financial valuation and financial due diligence for companies. She joined MKH Group in 2004 as a Corporate Finance Manager and was promoted to Financial Controller in 2008 and Chief Financial Officer in 2015. Age: 53 Years Old Age: Age: 40 Years Old 52 Years Old Malaysian Malaysian Malaysian Male Male Female Our Key Senior Management’s Profile PG. 40 MKH BERHAD ANNUAL REPORT 2024 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People
Age: Age: 56 Years Old 58 Years Old Malaysian Malaysian Male Male OUR KEY SENIOR He is the Treasury Director and Group Company Secretary for MKH Berhad group of companies. Prior to joining MKH Berhad Group in 1996, he was with a bank. He graduated from Universiti Utara Malaysia with a Bachelor Degree in Accountancy (Honours) and is a Chartered Accountant registered with the Malaysian Institute of Accountants (MIA) and is a member of Certified Practising Accountant (CPA), Australia. He was promoted to Chief Treasury Officer in 2015 and subsequently to Treasury Director in 2023. He has more than 31 years of senior-level management experience in company secretarial, legal and treasury matters. He was appointed as a Senior Manager in Property Development Department of MKH Berhad in 2007 and was promoted to General Manager in 2016 and subsequently to Senior General Manager in 2022. He started his career as an auditor in 1991 upon graduating from ITM in Accounting Studies. In 2001, he joined a property developer and was overseeing the Sales and Marketing portfolio and was later re-designated to be a Project Manager overseeing property development. Senior General Manager EN. AHMAD YANI SULAIMAN Treasury Director / Group Company Secretary MR. TAN WAN SAN PROFILE Save as disclosed, none of the Key Senior Management have:- • any directorship in public companies and listed issuers; • any family relationship with any Directors and/or major shareholders of the Company; • any conflict of interest with the Company or its subsidiaries; • any conviction for offences within the past 5 years other than traffic offences, if any; and • any public sanction or penalty imposed by the relevant regulatory bodies during the financial year. Sustaining Lives, Empowering Communities Governance That Inspires Confidence Financial Insights Through Numbers Empowering Ownership PG. 41
Management Discussion and Analysis Corporate Structure Corporate Information 44 56 58
DELIVERING VALUE THAT MATTER TO PEOPLE
Connecting Insights With Progress THIS REPORT PROVIDES A DISCUSSION AND ANALYSIS OF THE GROUP’S FINANCIAL PERFORMANCE FOR THE FINANCIAL YEAR ENDED 30 SEPTEMBER 2024 (FY2024), INCLUDING EXPLANATIONS FOR SUBSTANTIAL FLUCTUATIONS OVER THE PREVIOUS FINANCIAL YEAR. The Group’s principal business segments, which remained unchanged from the preceding year, comprise Property Development and Construction; Plantation; Hotel and Property Investment; and Others. The segment “Others” comprises Trading, Manufacturing, Investment Holding and other non-reportable operations. FY2024 FINANCIAL HIGHLIGHTS The Group’s revenue and profit before tax for the financial year under review and the preceding year are summarised as follows: 2024 2023 Changes RM’000 RM’000 (%) Group Revenue 1,060,881 1,063,796 (0.3) Segments • Property Development and Construction 580,043 587,648 (1.3) • Plantation 352,217 337,981 4.2 • Hotel and Property Investment 34,092 32,518 4.8 • Others 94,529 105,649 (10.5) Group Profit Before Tax 144,661 117,197 23.4 Segments • Property Development and Construction 40,772 56,585 (27.9) • Plantation 81,972 37,469 118.8 • Hotel and Property Investment 18,454 10,470 76.3 • Others 3,463 12,673 (72.7) Management Discussion and Analysis PG. 44 MKH BERHAD ANNUAL REPORT 2024 Laying The Foundation of Excellence Where People Matter Guided by Leadership, Inspired by People Delivering Value That Matters to People
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