Malaysia legislation

Section 6

of Mengikut peraturan Bilangan 34 Peraturan-Peraturan Tanah Tahun 1966, adalah

Seksyen 6

Hingga selesai

CATATAN:

Luar Musin 2006 – Padi yang ditanam bermula dari 1 Mac 2006 hingga 31 Julai 2006.

Pejabat Tanah Muar.

30 Mei 2006

[AOM. 26/79 (DUP)]

ABD. RAZAK BIN MD. SALLEH

Pentadbir Tanah

Muar

1640

[22hb Jun 2006

No. 1488.

JOHOR LAND BERHAD

(Company No. 12379–K)

(Incorporated in Malaysia)

AUDITORS REPORT PURSUANT TO SECTION 9 OF THE HOUSING DEVELOPERS’

(CONTROL AND LICENSING) ACT, 1966

We have audited the accompanying balance sheets as of 31 December 2005

and the related statements of income, cash flows and changes in equity for the year then ended. These financial statements are the responsibility of the

Company’s directors. It is our responsibility to form an independent opinion, based on our audit, on these financial statements and to report our opinion to you, as a body, in accordance with section 174 of the Companies Act, 1965

and for no other purpose. We do not assume responsibility towards any other person for the content of this report.

We conducted our audit in accordance with approved standards on auditing in

Malaysia. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of ma-terial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant esti-mates made by the directors, as well as evaluating the overall financial state-ments presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion:

(a)

the abovementioned financial statements are properly drawn up in accordance with the provisions of the Companies Act, 1965 and the ap-plicable MASB approved accounting standards in Malaysia so as to give a true and fair view of the state of affairs of the Group and of the Company as for 31 December 2005 and of the results and the cash flows of the

Group and of the Company for the year ended on that date; and

(b)

the accounting and other records examined by us are properly kept; and

(c)

the explanations and information given to us by the officers and agents of the Company have been statisfactory.

AF 0834 1479/1/07 (J)

Chartered Accountants

Partner

Johor Bahru 6 March 2006

22hb Jun 2006]

1641

INCOME STATEMENTS

The Group

The Company

Note(s)

2005 2004 2005 2004

Revenue 4 & 5 88,783,157 108,416,267 88,511,676 95,857,796

Cost of sales

(54,788,252)

(73,039,698)

(47,647,791)

(62,119,292)

Gross Profit 33,994,905 35,376,569 40,863,885 33,738,504

Other operating 1,683,436 1,046,697 381,288 2,730,115

income

Amortisation of

—

1,222,598

—

reserve on consolidation

Selling expenses

(3,800,726)

(2,148,918)

(3,774,011)

(2,094,835)

Administrative

(9,589,087)

(10,262,429)

(7,954,644)

(8,890,406)

expenses

Other operating

(1,628,656)

(11,382)

(1,503,823)

(11,082)

charges

Profit from operations 7 20,659,872 25,223,135 28,012,695 25,472,296

Finance costs 8

(14,518,451)

(3,320,319)

(14,353,323)

(3,157,171)

Share of results of associated companies 10,864,891 14,877,964

—

Amortisation of premium

(1,019,100)

—

on acquisition of associated company

Income from other 9 413,316 464,645 22,721 52,528

investment

Profit before tax 16,400,528 36,226,325 13,682,093 22,367,653

Income tax expense 10

The Company and subsidiary companies

(1,790,384)

(6,728,289)

(3,846,784)

(6,327,303

The accompanying Notes form an integral part of the Financial Statements.

1642

[22hb Jun 2006

INCOME STATEMENTS

The Group

The Company

Note(s)

2005 2004 2005 2004

Share of tax of associated companies

(3,042,170)

(3,196,670)

—

(4,832,554)

(9,924,959)

(3,846,784)

(6,327,303)

Profit after tax 11,567,974 26,301,366 9,835,309 16,040,350

Minority interests 111,575 53,633

—

Net profit for 11,679,549 26,354,999 9,835,309 16,040,350

the year

Earnings per share (sen)

- Basic 11 9.64 26.30

- Diluted 11 4.23 22.90

BALANCE SHEETS AS OF 31 DECEMBER 2005

The Group

The Company

Note(s)

2005 2004 2005 2004

Assets

Property, plant 13 7,745,379 6,999,936 2,707,126 2,951,296

and equipment

Investments subsidiaries companies 14

—

27,078,027 28,578,027

Associated companies 15 42,281,112 47,959,757 37,188,721 39,026,221

Land held for 16 498,918,665 502,828,938 486,886,815 489,572,383

future development

Deferred tax assets 17

—

CURRENT ASSETS

Inventories 18 47,297,106 44,504,986 45,752,395 36,882,642

Trade and other 19 40,682,314 27,495,834 50,831,839 34,618,090

receivables

Short-term investment 20 114,618 99,935 114,618 99,935

Deposis, bank and 21 20,879,336 17,155,856 1,171,498 1,169,372

cash balances

22hb Jun 2006]

1643

BALANCE SHEETS AS OF 31 DECEMBER 2005

The Group

The Company

Note(s)

2005 2004 2005 2004

Property development 22 87,788,664 74,506,773 63,551,288 61,052,240

projects 196,762,038 163,763,384 161,421,638 133,822,279

CURRENT LIABI-LITIES

Trade and other 23 22,269,906 19,918,835 21,216,863 19,354,978

payables

Dividends payable

—

2,142,007

—

2,142,007

Borrowings 24 46,735,513 40,498,975 42,719,713 36,483,175

Tax liabilities 1,309,699 1,008,069 486,547 821,922 70,315,118 63,567,886 64,423,123 58,802,082

NET CURRENT ASSETS

126,446,920 100,195,498 96,998,515 75,020,197

LONG-TERM AND

DEFERRED LIABILITIES

Borrowings-non 24

(69,202)

(341,641)

(59,987)

(316,626)

current portion

Convertible 25

(317,338,460)

(303,210,004)

(317,338,460)

(303,210,004)

Unsecured Loan

Stocks (“CULS”)

Deferred tax 17

(2,995,763)

(7,522,199)

(2,994,763)

(7,501,199)

liabilities

(320,403,425)

(311,073,844)

(320,393,210)

(311,027,829)

MINORITY INTERESTS

(72,413)

(183,986)

—

NET ASSETS

354,916,238 346,726,299 330,465,994 324,120,295

Represented by:

Issued capital 26 122,000,000 122,000,000 122,000,000 122,000,000

Convertible Unsecured

Loan Stock-equity portion 25 19,288,797 19,288,797 19,288,797 19,288,797

Share premium 27 78,581,839 78,581,839 78,581,839 78,581,839

Treasury shares 26

(760,158)

Revaluation 27

—

2,530,027 2,530,027

reserve

Unappropriated profit 27 135,805,760 127,615,821 108,825,489 102,479,790

Shareholders’ Equity 354,916,238 346,726,299 330,465,994 324,120,295

1644

[22hb Jun 2006

STATEMENTS OF CHANGES IN EQUITY

Non-distributable

Reserves

Convertible

Distributable

Unsecured Loan

Reserve

Total/Net

Issued

Stocks-Equity

Treasury

Premium

Consolidation

Unappropriated

Shareholder’s

Capital

Portion

Reserve

Profit

Equity

The Group

Balance as of 1 January 2004 100,000,000

—

(592,011)

78,581,839 1,222,598 107,814,391 287,026,817

Share buy back

—

(168,147)

—

(168,147)

Amortisation of reserve on consolidation

—

(1,222,598)

—

(1,222,598)

Net profit for the year

—

26,354,999 26,354,999

Dividend paid/payable (Note 12)

—

(6,553,569)

Issue of shares (Note 26)

22,000,000

—

22,000,000

Issue of Convertible Unsecured

Loan Stocks (Note 25)

Equity component

—

26,789,996

—

26,789,996

Tax on equity component (Note 17)

—

(7,501,199)

—

(7,501,199)

Balance as of 31 December 2004 122,000,000 19,288,797

(760,158)

78,581,839

—

127,615,821 346,726,299

Net profit for the year

—

11,679,549 11,679,549

Dividend paid/payable (Note 12)

—

(3,489,610)

(3,489,610

Balance as of 31 December 2005 122,000,000 19,288,797

(760,158)

78,581,839

—

135,805,760 354,916,238

The accompanying Notes form an integral part of the Financial Statements.

22hb Jun 2006]

1645

STATEMENTS OF CHANGES IN EQUITY

Non-distributable

Reserves

Convertible

Distributable

Unsecured Loan

Reserve

Total/Net

Issued

Stocks-Equity

Treasury

Premium

Revaluation

Unappropriated

Shareholder’s

Capital

Portion

Reserve

Profil

Equity

The Company

Balance as of 1 January 2004 100,000,000

—

(592,011)

78,581,839 2,530,027 92,993,009 273,512,864

Share buy back

—

(168,147)

—

(168,147)

Net profit for the year

—

16,040,350 16,040,350

Dividend paid/payable (Note 12)

—

(6,553,569)

Issue of shares (Note 26)

22,000,000

—

22,000,000

Issue of Convertible Unsecured

Loan Stocks (Note 25)

Equity component

—

26,789,996

—

26,789,996

Tax on equity component (Note 17)

—

(7,501,199)

—

(7,501,199)

Balances as of 31 December 2004 122,000,000 19,288,797

(760,158)

78,581,839 2,530,027 102,479,790 324,120,295

Net profit for the year

—

9,835,309 9,835,309

Dividend paid/payable (Note 12)

—

(3,489,610)

Balance as of 31 December 2005 122,000,000 19,288,797

(760,158)

78,581,839 2,530,027 108,825,489 330,465,994

The accompanying Notes form an integral part of the Financial Statements.

1646

[22hb Jun 2006

The Group

The Company

Note 2005 2004 2005 2004

(USED IN) OPERATING

Profit before minority 11,567,974 26,301,366 9,835,309 16,040,350

interests

Adjustments for:

Finance costs 14,518,451 3,320,319 14,353,323 3,157,171

Income tax expenses 4,832,554 9,924,959 3,846,784 6,327,303

Loss (Gain) on disposal of:

Unquoted investments in an associated company 1,623,786

—

Quoted investment

(12,612)

(26,926)

(12,612)

(26,926)

Property, plant and equipment

—

(108,960)

—

(108,960)

Amortisation of:

Premium on acquisition of associated company 1,019,100 1,019,100

—

Reserve on consolidation

—

(1,222,598)

—

Depreciation of property, plant and equipment 805,610 757,435 499,493 483,497

Allowance for:

Inventories obsolescence 76,972

—

Diminution in value of investment in a subsidiary company

—

1,500,00

—

Diminution in value of investment in an associated company no longer required

—

(1,837,500)

Doubtful debts

—

30,961

—

Amount written-off for :

Property, plant and equipment 4,869 7,540 3,823 5,736

Inventories 54,062

—

Gross dividends from:

Unquoted investment:

Associated company

—

(12,529,138)

—

Subsidiary company

—

(1,108,030)

(664,818)

Quoted investments

(5,641)

(7,798)

(5,641)

(7,798)

Interest income

(413,316)

(464,645)

(22,721)

(52,528)

Impairment loss on

Property, plant and equipment no longer required

(1,065,754)

—

Share in results of associated companies

(10,864,891)

(14,877,964)

—

22hb Jun 2006]

1647

FOR THE YEAR ENDED 31 DECEMBER 2003—(cont’d)

The Group

The Company 2005 2004 2005 2004

Operating Profit Before 22,141,164 24,652,789 16,360,590 23,315,527

Working Capital

Changes

(Increase) Decrease in:

Inventories

(2,923,153)

2,323,203

(8,869,753)

8,741,914

Trade and other receivables 1,960,206 9,049,676

(15,894,637)

8,299,698

Property development projects

(6,621,005)

(17,052,862)

2,937,133

(21,026,251)

Increase in:

Trade and other payables

(12,641,916)

4,032,634 2,015,583 4,095,765

Cash From (Used In)

Operations 1,915,296 23,005,440

(3,451,084)

23,426,653

Decrease (Increase) in:

Land held for future development 2,685,568 12,073,101 2,685,568 12,073,101

Finance costs paid

(5,979,874)

(3,166,621)

(5,814,746)

(3,003,473)

Income tax paid

(6,013,889)

(5,407,585)

(4,868,888)

5,182,258

Tax refund

—

727,776

—

Net cash From (Used In)

Operating Activities

(7,392,899)

27,232,111

(11,449,150)

27,314,023

(USED IN) INVESTING

Dividends (net) received from:

Associated company 9,020,979

—

9,020,979

—

Subsidiary company

—

478,670

—

Quoted investments 4,341 6,537 4,341 6,537

Proceeds from disposal of:

Unquoted investment in an associated company 1,837,500

—

1,837,500

—

Quoted invesments 143,024 293,512 143,024 293,512

Property, plant and equipment

—

1,770,000

—

1,770,000

Interest received 413,316 464,645 22,721 52,528

Purcharse of:

Quoted investments

(145,095)

(242,399)

(145,095)

(242,399)

Property, plant and equipment

(490,168)

(563,589)

(259,146)

(496,117)

Net Cash From Investing

Activities 10,783,897 7,755,706 11,102,994 1,384,061

1648

[22hb Jun 2006

FOR THE YEAR ENDED 31 DECEMBER 2005—(cont’d)

Note

The Group

The Company 2005 2004 2005 2004

(USED IN) FINANCING

Proceeds from revolving credits 5,000,000

—

5,000,000

—

Purcharse of own shares

—

(168,147)

—

(168,147)

Repayment of hire-purchase payables

(272,439)

(238,239)

(256,639)

(222,439)

Dividend paid

(5,631,617)

(4,411,562)

(5,631,617)

(4,411,562)

Repayment of term loan

(4,095,694)

(7,557,490)

(4,095,694)

(7,557,490)

Repayment of revolving credits

(4,998,123)

(12,170,733)

(4,998,123)

(12,170,733)

Net Cash Used In Financing

Activities

(9,997,873)

(24,546,171)

(9,982,073)

(24,530,371)

NET INCREASE

(DECREASE) IN

EQUIVALENTS

(6,606,875)

4,441,646

(10,328,229)

4,167,713

EQUIVALENTS AT

BEGINNING OF

YEAR

(9,929,272)

(14,370,918)

(25,915,756)

(30,083,469)

EQUIVALENTS AT

END OF YEAR

(16,536,147)

(9,929,272)

(36,243,985)

(25,915,756)

In 2004, the Group’s and the Company’s additions to property, plant and equipment amounted to RM1,171,589 and RM1,131,117 respectively of which RM635,000

and RM635,000 were made under hire-purcharse arrangements. The remaining additions of RM536,589 and RM496,117 respectively were made by cash payment.

The accompanying Notes form an integral part of the Financial Statements.

22hb Jun 2006]

1649

NOTES TO THE FINANCIAL STATEMENTS

Read in full context — Mengikut peraturan Bilangan 34 Peraturan-Peraturan Tanah Tahun 1966, adalah →