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SEQUOIA HOLDINGS BERHAD Company No. 570396-D CONDENSED BALANCE SHEET AS AT 31 OCTOBER 2009 (The figures have not been audited) As At As At End Preceding Of Current Financial Quarter Year End 31.10.09 31.7.09 RM'000 RM'000 ASSETS Non-current assets Property, plant and equipment 13,921 11,544 Prepaid land lease payments 2,960 2,977 Intangible assets 4,819 4,878 21,700 19,399 Current assets Inventories 37,243 39,026 Receivables 34,500 30,266 Other receivables and deposits 9,332 6,634 Tax recoverable 562 672 Cash and bank balances 2,315 3,294 83,952 79,892 Non-current assets held for sale 147 147 84,099 80,039 TOTAL ASSETS 105,799 99,438 EQUITY & LIABILITIES Equity attributable to equity holders of the Company Share capital 62,500 62,500 Share premium 21 21 Treasury shares (71) (63) Translation reserves (24) 143 Retained profits 18,583 15,827 81,009 78,428 Minority interest 755 1,263 Total equity 81,764 79,691 Non-current liabilities Deferred taxation 859 860 Long term liabilities 709 1,199 1,568 2,059 Current liabilities Payables 4,613 8,015 Other payables and accruals 2,356 2,336 Amount owing to director 697 697 Short term borrowings 13,910 6,312 Provision for taxation 891 328 22,467 17,688 Total liabilities 24,035 19,747 TOTAL EQUITY & LIBILITIES 105,799 99,438 SEQUOIA HOLDINGS BERHAD Company No. 570396-D CONDENSED CONSOLIDATED INCOME STATEMENT FOR THE FIRST QUARTER ENDED 31 OCTOBER 2009 (The figures have not been audited) Individual Quarter Cumulative Quarter Preceding Year Preceding Year Current Year Corresponding Current Year Corresponding Quarter Quarter To Date Quarter 31.10.09 31.10.08 31.10.09 31.10.08 RM'000 RM'000 RM'000 RM'000 Revenue 17,732 23,304 17,732 23,304 Operating expenses (14,979) (19,913) (14,979) (19,913) Other operating income 655 1,305 655 1,305 (Loss)/ Profit from operations 3,408 4,696 3,408 4,696 Finance cost (225) (191) (225) (191) Profit before tax 3,183 4,505 3,183 4,505 Taxation (888) (1,027) (888) (1,027) Net (loss)/ profit for the period 2,295 3,478 2,295 3,478 Attributable to Equity holders of the parent 2,756 2,741 2,756 2,741 Minority interest (461) 737 (461) 737 2,295 3,478 2,295 3,478 Basic earnings per share (sen) 2.20 2.19 2.20 2.19 Note : SEQUOIA HOLDINGS BERHAD Company No. 570396-D CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE FIRST QUARTER ENDED 31 OCTOBER 2009 (The figures have not been audited) ------------- Attributable to Equity Holders of the Parent------------- Minority Total Non-distributable Distributable Interest Equity Share Share Treasury Translation Retained Capital Premium Shares Reserve Profits Total RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 RM'000 First quarter ended 31.10.09 Balance at 1.8.2009 62,500 21 (23) (348) 15,827 77,977 1,263 79,240 Currency translation difference - - - 324 - 324 (47) 277 Net profit for the period - - - - 2,756 2,756 (461) 2,295 Shares acquired/disposed - - (48) - - (48) - (48) Balance at 31.10.2009 62,500 21 (71) (24) 18,583 81,009 755 81,764 First quarter ended 31.10.08 Balance at 1.8.2008 62,500 21 - - 13,084 75,605 1,689 77,294 Currency translation difference - - - (348) - (348) - (348) Net profit for the period - - - - 2,671 2,671 411 3,082 Shares acquired/disposed - - (23) - - (23) (1,385) (1,408) Balance at 31.10.2008 62,500 21 (23) (348) 15,755 77,905 715 78,620 Note : SEQUOIA HOLDINGS BERHAD Company No. 570396-D CONDENSED CONSOLIDATED CASH FLOW STATEMENT FOR THE FIRST QUARTER ENDED 31 OCTOBER 2009 (The figures have not been audited) Cumulative Cumulative Current Year Preceding Year Quarter Quarter 31.10.09 31.10.08 RM'000 RM'000 Cash flows from operating activities Profit before taxation 3,183 4,505 Adjustments for : - Non-cash items 58 338 - Non-operating items 155 191 Operating profit before working capital changes 3,396 5,034 Inventories 1,783 (751) Receivables (6,932) (9,435) Payables (3,382) (1,006) Cash used in operations (5,135) (6,158) Interest paid (225) (191) Income tax paid (216) (348) Net cash used in operating activities (5,576) (6,697) Cash flows from investing activities Proceeds from disposal of property, plant & equipment 85 - Purchase of property, plant and equipment (2,715) (106) Net cash used in investing activities (2,630) (106) Cash flows from financing activities Bankers acceptance 2,719 4,785 Drawdown of factoring liabilities 534 - Repayment of bank borrowings (389) (570) Net cash from financing activities 2,864 4,215 Net increase in cash and cash equivalents (5,342) (2,588) Effect of foreign exchange rate difference (63) (202) Cash and cash equivalents at beginning 3,476 6,548 Cash and cash equivalents at end (1,929) 3,758 Represented by: Cash and bank balances 2,315 3,758 Bank overdrafts (4,244) - (1,929) 3,758 SEQUOIA HOLDINGS BERHAD Company No. 570396-D SELECTED EXPLANATORY NOTES 31 OCTOBER 2009 1. Basis of Preparation The interim financial statements are unaudited and have been prepared in compliance with Financial Reporting Standards (“FRS”) 134 Interim Financial Reporting and Chapter 9 part K of the Listing Requirements of the Bursa Malaysia Securities Berhad (“Bursa Malaysia”). The interim financial statements should be read in conjunction with the audited financial statements for the year ended 31 July 2009. These explanatory notes attached to the interim financial statements provide an explanation of events and transactions that are significant to an understanding of the changes in the financial position and performance of Sequoia Holdings Berhad. (“Sequoia” or “Company”) and its subsidiary companies (hereinafter referred to as the “Group”) since the financial year ended 31 July 2009. The same accounting policies and methods of computation are followed in the interim financial statements as compared with the financial statements for the financial year ended 31 July 2009. 2 Audit Report The auditors' report on the financial statements for the year ended 31 July 2009 was not qualified. 3 Seasonality or Cyclicality As the Group is basically involved in the distribution of fashion apparels, major festivals and carnival sales have an impact on revenue and earnings. 4 Exceptional items There were no exceptional items for the current period under review. 5 Estimates There were no changes to the estimates that have been used in the preparation of the current financial statements. 6 Issuance or repayment of debt/equity securities There were no issuance or repayment of debt or equity securities for the current financial year to date. 7 Dividends No dividend has been proposed for the current financial period to date. A first and final dividend of 3% less tax has been proposed for the previous financial year ended 31st July 2009 which, if approved at the forthcoming Annual General Meeting, will be payable on 8th February 2010. SEQUOIA HOLDINGS BERHAD Company No. 570396-D SELECTED EXPLANATORY NOTES 31 OCTOBER 2009 8 Segmental Reporting Business segments The Group is principally engaged in the manufacturing, marketing, distribution and retailing of jeanswear, other fashion apparels and accessories. Business segmental information has therefore not been prepared as the Group’s revenue, operating profit, assets employed, liabilities, capital expenditure, depreciation and non-cash expenses are mainly confined to one business segment. Geographical Segments The business segment of the Group is managed principally in Malaysia and its products are distributed mainly in Malaysia and the United Kingdom. In presenting information on the basis of geographical segments, segment revenue is based on the geographical location of customers whereas segment assets are based on the geographical location of assets. Current Quarter 31.10.09 Total Capital Revenue assets expenditure RM'000 RM'000 RM'000 Malaysia 15,024 89,058 2,699 United Kingdom 2,708 16,741 16 17,732 105,799 2,715 Current Year To Date 31.10.09 Total Capital Revenue assets expenditure RM'000 RM'000 RM'000 Malaysia 15,024 89,058 2,699 United Kingdom 2,708 16,741 16 17,732 105,799 2,715 9 Valuation of Property, Plant and Equipment There were no changes in the valuation of property, plant and equipment since the last audited financial statements for the year ended 31 July 2009. 10 Subsequent Events In the opinion of the directors, there were no material events that have arisen between the end of the reporting quarter and the date of this announcement. SEQUOIA HOLDINGS BERHAD Company No. 570396-D SELECTED EXPLANATORY NOTES 31 OCTOBER 2009 11 Change In The Composition of The Group There were no change in the composition of the Group for the financial year to date. 12 Contingent Liabilities and Contingent Assets There were no contingent liabilities and contingent assets of a material nature as at the date of this report. 13 Capital Commitments There are no outstanding capital commitments at the end of the current quarter. 14 Review Of Performance The Group achieved revenue of RM17.7 million, which was 24% lower than the RM23.3 million achieved for the previous year as consumer demand and the retail sector continued to show slow recovery from the global economic crisis. As a result, profit before tax achieved was RM3.2 million which was lower than the RM4.5 million achieved in the previous period. 15 Material change in profit before taxation as compared to preceding quarter Turnover for this quarter of RM17.7 million was slightly higher than RM17.5million achieved in the previous quarter. The slight increase in sales for this quarter was due to the festive season. This quarter recorded a profit of RM3.2million as opposed to the loss of RM0.3million for the previous quarter due to the sales of new items with higher margins. 16 Current Year Prospects We would expect a more stable and favourable economic outlook for the year, in view of the indirect impact of the government's stimulus packages . The Board expects its performance in the current year to 31st July 2010 to continue to be satisfactory. SEQUOIA HOLDINGS BERHAD Company No. 570396-D SELECTED EXPLANATORY NOTES 31 OCTOBER 2009 17 Taxation Current Year Current Year Quarter To Date 31.10.09 31.10.09 RM'000 RM'000 Taxation comprise the following : Based on profit for the period : - Current tax 888 888 - Deferred taxation - - 888 888 Reconcilitation of statutory tax rate to effective tax rate : Current Year Current Year Quarter To Date 31.10.09 31.10.09 % % Statutory tax rate 25 25 Different tax rates in other countries - - (Over)/ Underprovision in previous quarters 3 3 28 28 18 Unquoted Investments / Properties There were no sale of unquoted investments and properties for the current quarter under review. 19 Purchase or Disposal of Quoted Securities (a) There were no purchases or disposals of quoted securities for the current quarter under review. (b) There were no investments in quoted securities as at the end of the reporting period. 20 Corporate Proposals Twoagentsee International Ltd, a subsidiary of the company, had signed a Memorandum of Understanding on 24th April 2009 with BGT Corporation PCL("BGT") of Thailand for BGT to market products under the brand name of "Peoples Market". Both parties are still in the process of finalizing details for a formal agreement on the cooperation. SEQUOIA HOLDINGS BERHAD Company No. 570396-D SELECTED EXPLANATORY NOTES 31 OCTOBER 2009 21 Group Borrowings and Debt Securities Unsecured Secured Total Group borrowings RM'000 RM'000 RM'000 Short term Bank Overdraft - 4,244 4,244 Bankers acceptance - 7,752 7,752 Term loans - 1,380 1,380 Factoring liabilities - 534 534 - 13,910 13,910 Long term Term loans - 709 709 - 709 709 Total - 14,619 14,619 22 Off Balance Sheet Financial Instruments The Group does not have any financial instruments with off balance sheet risk as at the date of this report. 23 Material Litigation The Group does not have any material litigation as at the date of this report. 24 Basis of calculation of earnings per share The basic earnings per share for the quarter and cumulative year to date are computed as follow: Indivdual Cumulative Current Year Current Year Quarter To Date 31.10.09 31.10.09 Net Profit for the period (RM'000) 2,756 2,756 Weighted average number of ordinary shares in issue ('000) 125,000 125,000 Basic Earnings Per Share (sen) 2.20 2.20 There is no diluted earnings per share as the Company does not have any convertible financial instruments as at the end of the reported quarter and year.