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									PILECON ENGINEERING BERHAD (Company No. 29223-P)
( Incorporated in Malaysia )




Part A2 : SUMMARY OF KEY FINANCIAL INFORMATION



                       Summary of Key Financial Information for the financial period ended 31 March 2006


                                                                  INDIVIDUAL QUARTER                              CUMULATIVE QUARTER
                                                               CURRENT                 PRECEDING               CURRENT                 PRECEDING
                                                                YEAR                     YEAR                   YEAR                     YEAR
                                                               QUARTER               CORRESPONDING             TO DATE               CORRESPONDING
                                                                                       QUARTER                                          PERIOD
                                                              31/03/2006               31/03/2005             31/03/2006               31/03/2005
                                                                RM '000                 RM '000                 RM '000                 RM '000


    1 Revenue                                                          3,595                 14,924                    3,595                  14,924

    2 Profit/(loss) before tax                                       (3,601)                  (2,427)                (3,601)                  (2,427)

    3 Profit/(loss) after tax and minority interest                  (3,554)                  (2,384)                (3,554)                  (2,384)

    4 Net profit/(loss) for the period                               (3,554)                  (2,384)                (3,554)                  (2,384)

    5 Basic earnings/(loss) per share (sen)                               (0.89)                  (0.60)                  (0.89)                  (0.60)

    6 Dividend per share (sen)                                            0.00                    0.00                    0.00                    0.00

                                                             AS AT END OF CURRENT QUARTER                  AS AT PRECEDING FINANCIAL YEAR END



    7 Net assets per share (RM)                                               0.04                                            0.05




Part A3 : ADDITIONAL INFORMATION


                                                                  INDIVIDUAL QUARTER                              CUMULATIVE QUARTER
                                                               CURRENT                 PRECEDING               CURRENT                 PRECEDING
                                                                YEAR                     YEAR                   YEAR                     YEAR
                                                               QUARTER               CORRESPONDING             TO DATE               CORRESPONDING
                                                                                       QUARTER                                          PERIOD
                                                              31/03/2006               31/03/2005             31/03/2006               31/03/2005
                                                                RM '000                 RM '000                 RM '000                 RM '000


    1 Profit/(loss) from operations                                       (149)                    954                    (149)                     954

    2 Gross interest income                                                503                     664                     503                      664

    3 Gross interest expense                                           5,609                    6,137                  5,609                    6,137
           PILECON ENGINEERING BERHAD (Company No. 29223-P)
           ( Incorporated in Malaysia )


           CONDENSED FINANCIAL STATEMENTS

           UNAUDITED CONDENSED CONSOLIDATED INCOME STATEMENT
           FOR THE 3 MONTHS ENDING 31 MARCH 2006

                                                                                  INDIVIDUAL QUARTER                    Cumulative Quarter
                                                                               CURRENT           PRECEDING          CURRENT         PRECEDING
                                                                                YEAR                YEAR              YEAR             YEAR
                                                                               QUARTER          CORRESPONDING        TO DATE       CORRESPONDING
                                                                                                  QUARTER                             PERIOD
                                                                              31/03/2006          31/03/2005        31/03/2006       31/03/2005
                                                                                RM '000            RM '000           RM '000          RM '000


            1   (a) Revenue                                                          3,595             14,924             3,595              14,924
                (b) Investment income                                                  -                  -                 -                   -
                (c) Other income                                                     7,059              1,564             7,059               1,564

            2   (a) Profit/(loss) before finance cost, depreciation
                        and amortisation, exceptional items, income
                        tax, minority interests and extraordinary items                407               1,473              407               1,473
                (b) Finance cost                                                    (5,609)             (6,137)          (5,609)             (6,137)
                (c) Depreciation and amortisation                                     (556)               (519)            (556)               (519)
                (d) Exceptional items                                                  -                   -                -                   -
                (e) Profit/(loss) before income tax, minority
                        interests and extraordinary items                           (5,758)             (5,183)          (5,758)             (5,183)
                (f) Share of profits and losses of associated companies              2,157               2,756            2,157               2,756
                (g) Profit/(loss) before income tax                                 (3,601)             (2,427)          (3,601)             (2,427)
                (h) Income tax                                                         -                   -                -                   -
                    Profit for the period from continuing operations                (3,601)             (2,427)          (3,601)             (2,427)

                (i) Discontinued Operations
                    Loss for the period from discontinued
                        operations                                                      (1)                 (1)              (1)                 (1)
                (j) Profit/(Loss) for the period                                    (3,602)             (2,428)          (3,602)             (2,428)



                (k) Attributable to
                    (i) Equity holders of the parent                                (3,554)             (2,384)          (3,554)             (2,384)
                    (ii) Minority Interest                                             (48)                (44)             (48)                (44)
                                                                                    (3,602)             (2,428)          (3,602)             (2,428)



                (l) Earnings Per Share
                    (i) Basic (sen)
                         - profit/(loss) from continuing operations                    (0.89)              (0.60)         (0.89)              (0.60)
                         - profit/(loss) from discontinued operations                  (0.00)              (0.00)         (0.00)              (0.00)

                          - for profit/(loss) for the period                           (0.89)              (0.60)         (0.89)              (0.60)



                     (ii) Diluted (sen)                                          N/A             Antidilutive         N/A           Antidilutive




           The condensed Financial Statements should be read in conjunction with the audited annual financial statements of the Group for the year
           ended 31 December 2005.




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           PILECON ENGINEERING BERHAD (Company No. 29223-P)
           ( Incorporated in Malaysia )
           CONDENSED FINANCIAL STATEMENTS

           UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEET AS AT 31 MARCH 2006

                                                                                                 AS AT              AS AT
                                                                                                END OF           PRECEDING
                                                                                               CURRENT           FINANCIAL
                                                                                               QUARTER            YEAR END
                                                                                               31/03/2006         31/12/2005
                                                                                                RM '000            RM '000


                ASSETS
                Non-current assets
                Property, Plant and Equipment                                                        48,528             49,601
                Property Development Expenditure                                                    123,998            123,988
                Investments in Associated Companies                                                 118,777            118,660
                Other Investments                                                                    17,978             17,678
                Goodwill on consolidation                                                            13,721             13,721
                                                                                                    323,002            323,648


                Current assets
                Land and Development Expenditure                                                     34,028             35,049
                Gross amount due from customers on construction works                                12,830             11,402
                Inventories                                                                           5,666              5,716
                Trade Receivables                                                                    45,915             46,182
                Other Receivables                                                                    84,529             80,151
                Tax recoverable                                                                       4,722              4,715
                Amount due from associated companies                                                 62,059             61,730
                Cash,bank balances and deposits                                                       2,860              3,601
                                                                                                    252,609            248,546


                TOTAL ASSETS                                                                        575,611            572,194


                EQUITY AND LIABILITIES
                Equity attributable to equity holders of the parent
                Share Capital                                                                       199,821            199,821
                Reserves
                    Share Premium                                                                   138,744            138,744
                    Exchange Fluctuation Reserve                                                    (15,174)           (15,404)
                    Reserve on Consolidation                                                            -                  783
                    Capital Reserve                                                                   1,400              1,400
                Accumulated Loss                                                                   (316,416)          (313,645)
                                                                                                      8,375             11,699
                Minority Interests                                                                    7,526              7,577
                Total equity                                                                         15,901             19,276


                Non-current liabilities
                Long Term Liabilities                                                                   687                717
                Deferred Taxation                                                                         5                -
                Retirement benefit obligations                                                          495                491
                                                                                                      1,187              1,208

                Current liabilities
                Gross amount due to customers on construction works                                       7                163
                Trade Payables                                                                       41,929             58,527
                Other Payables                                                                      145,141            124,448
                Provisions for liabilities                                                           95,566             93,680
                Amount due to associated companies                                                    3,061              3,062
                Provision for Taxation                                                                  -                  -
                Short Term Borrowings                                                               272,446            271,453
                Retirement benefit obligations                                                          373                377
                                                                                                    558,523            551,710


                Total liabilities                                                                   559,710            552,918

                TOTAL EQUITY AND LIABILITIES                                                        575,611            572,194



           The condensed Financial Statements should be read in conjunction with the audited annual financial statements of the Group for the year
           ended 31 December 2005.




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PILECON ENGINEERING BERHAD (Company No. 29223-P)
( Incorporated in Malaysia )
CONDENSED FINANCIAL STATEMENTS

UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE 3 MONTHS ENDING 31 MARCH 2005

                                                                                                                              Minority
                                                                 Attributable to Equity Holders of the Parent
                                                                                                                              Interest    Total Equity
                                                                     Non-Distributable
                                                    Share         Share         Other          Accumulated
                                                    Capital      Premium      Reserves            Loss           Total
                                                    RM'000        RM'000       RM'000            RM'000         RM'000        RM'000       RM'000

At 1 January 2005                                   199,821        138,744         (11,408)       (267,109)        60,048      13,401         73,449

Currency Translation differences                         -               -             (126)           -             (126)      (2,502)       (2,628)
Loss for the period                                      -               -              -           (2,384)        (2,384)         (44)       (2,428)

At 31 March 2005                                    199,821        138,744         (11,534)       (269,493)        57,538      10,855         68,393
                                                                                                                      -                          -




UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
FOR THE 3 MONTHS ENDING 31 MARCH 2006


                                                                                                                               Minority
                                                                 Attributable to Equity Holders of the Parent
                                                                                                                               Interest Total Equity
                                                                     Non-Distributable
                                                    Share         Share         Other          Accumulated
                                                    Capital      Premium      Reserves            Loss              Total
                                                    RM'000        RM'000       RM'000            RM'000         RM'000        RM'000       RM'000

At 1 January 2006                                   199,821        138,744         (13,221)       (313,645)        11,699        7,577        19,276

Effects of adopting:
     FRS 3                                              -              -              (783)            783            -            -             -
                                                    199,821        138,744         (14,004)       (312,862)        11,699        7,577        19,276

Reclassification
Currency Translation differences                         -               -             230             -              230           (3)          227
Profit for the period                                    -               -             -            (3,554)        (3,554)         (48)       (3,602)

At 31 March 2006                                    199,821        138,744         (13,774)       (316,416)         8,375        7,526        15,901
                                                                                                                                                 -




     The condensed Financial Statements should be read in conjunction with the audited annual financial statements of the Group for the year ended 31
     December 2005.
          PILECON ENGINEERING BERHAD (Company No. 29223-P)
          ( Incorporated in Malaysia )
          CONDENSED FINANCIAL STATEMENTS


          UNAUDITED CONDENSED CONSOLIDATED CASH FLOW STATEMENT
          FOR THE 3 MONTHS ENDING 31 MARCH 2006

                                                                                                  2006                    2005
                                                                                                3 months                3 months
                                                                                                  ended                   ended
                                                                                                31 March                31 March
                                                                                                RM'000                  RM'000
          CASH FLOWS FROM OPERATING ACTIVITIES

          Profit / (Loss) before taxation                                                             (3,602)                (2,428)
          Adjustments for:
              Share of results of associated companies                                                (2,157)                (2,756)
              Depreciation                                                                               556                    519
              Gain on foreign exchange                                                                   230                   (126)
              Interest expenses                                                                        5,609                  6,137
              Interest income                                                                           (503)                  (664)

          Operating (loss) / profit before working capital changes                                       133                    682

          Gross amount due to / (from) customers on construction contracts                            (1,584)                (1,308)
          Inventories                                                                                     50                     (9)
          Trade and other receivables                                                                 (4,121)                (9,650)
          Trade and other payables                                                                       983                    867
          Land and development expenditure                                                             1,011                   (477)
          Associated companies balances                                                                 (330)                   309

          Cash used in operations                                                                     (3,858)                (9,586)
          Interest paid                                                                                  -                       -
          Interest received                                                                              -                       -
          Tax refund / (paid)                                                                            -                       -

          Net cash used in operating activities                                                       (3,858)                (9,586)

           The condensed Financial Statements should be read in conjunction with the audited annual financial statements of the Group for
          the year ended 31 December 2005.




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                                                                          Announ -CF                                                        Page 5 of 12
          CASH FLOWS FROM INVESTING ACTIVITIES

          Purchase of other investments                                                                 (300)                  (204)
          Dividend received from associated companies                                                  2,040                  9,940

          Net cash (used in)/generated from investing activities                                       1,740                  9,736

          CASH FLOWS FROM FINANCING ACTIVITIES

          Repayment of hire purchase and lease financing                                                 (30)                   -
          Drawdown of short term borrowings                                                              -                      -
          Repayment of loans                                                                             -                     (145)

          Net cash used in financing activities                                                          (30)                  (145)

          NET INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS                                        (2,148)                        5

          EFFECTS OF EXCHANGE RATE CHANGES                                                               -                       -

          CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                                             (84,805)               (77,067)

          CASH AND CASH EQUIVALENTS AT END OF YEAR                                                   (86,953)               (77,062)

          CASH AND CASH EQUIVALENTS COMPRISE:

          Cash, bank balances and deposits                                                             2,741                  6,542
          Cash held in Housing Developers Account
          (Housing Development Account) Regulations, 1991                                                119                    186
                                                                                                       2,860                  6,728

          Bank overdrafts                                                                            (89,813)               (83,790)

                                                                                                    (86,953)                (77,062)




           The condensed Financial Statements should be read in conjunction with the audited annual financial statements of the Group for
          the year ended 31 December 2005.




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                                                                          Announ -CF                                                        Page 6 of 12
                                                                   PILECON ENGINEERING BERHAD
                                                                        ( Company No. 29223 - P )
                                                                        ( Incorporated in Malaysia )

                                                               CONDENSED FINANCIAL STATEMENTS

        A. EXPLANATORY NOTES TO THE INTERIM FINANCIAL STATEMENTS - MASB

        A1. Basis of Preparation
            The interim financial statements for the financial quarter and the three months period ended 31 March 2006 are unaudited and have been prepared
            in accordance with the requirements of FRS 134: Interim Financial Reporting and Chapter 9 of the Listing Requirements of the Bursa Malaysia
            Securities Berhad.

              The interim financial statements should be read in conjunction with the audited financial statements for the year ended 31 December 2005. 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 the Group since the year ended 31 December 2005.

              Changes in Accounting Policies

              The significant accounting policies and methods of computation applied in the financial statements of the Group are consistent with those applied
              in the latest audited annual financial statements except for the adoption of all the new/revised Financial Reporting Standards ("FRS") effective for
              financial period beginning 1 January 2006.

              The adoption of new FRSs does not have significant financial impact on the Group. The principal effects of the changes in accounting policies
              resulting from the adoption of the new/revised FRSs are as follows:-


              (a) FRS 3: Business Combination

                   Under the new standard, any excess of the Group's interest in the net fair value of acquirees' identifiable assets, liabilities and contingent
                   liabilities over cost of acquisitions (previously referred to as "negative goodwill"), after reassessment, is now recognised immediately in
                   profit or loss. Prior to 1 January 2006, to the extent that negative goodwill relates to expectation of future losses and expenses that are
                   identifiable in the plan of acquisition and can be measured reliably, but which are not identifiable liabilities at the date of acquisition, that
                   portion of negative goodwill is recognised in the income statement when the future losses and expenses are recognised.


              (b) FRS 101: Presentation of Financial Statements

                   The adoption of the revised FRS 101 has affected the presentation of minority interest, share of net after-tax results of associates and other
                   disclosures. In the consolidated balance sheet, minority interests are now presented within total equity. In consolidated income statement,
                   minority interests are presented as an allocation of the total profit or loss for the period. A similar requirement is also applicable to the
                   statement of changes in equity. There is disclosure, on the face of the statement of changes of equity, total recognised income and expenses
                   for the period, showing separately the amounts attributable to equity holders of the parent and to minority interest.


        A2. Audit Report
            The audit report of the Group's audited annual financial statements for the year ended 31 December 2005 was not subject to any qualification.

        A3. Seasonal or Cyclical Factors
            The construction, engineering and property sectors which encompass the major activities of the Group are subject to effects of the business cycle
            and the overall growth of the economy. The performance of the Group is affected by seasonal or cyclical factors.

        A4. Items Affecting Net Income and Cash flow
            There were no unusual items affecting the assets, liabilities, equity, net income, or cash flows for the financial quarter ended 31 March 2006.

        A5. Changes in Estimates
            There was no material change in estimates of amounts reported in prior financial year that have a material effect on the financial quarter ended 31
            March 2006.

        A6. Issuance and Repayment of Debt and Equity Securities
            There were no issuance and repayment of debt and equity securities, share buy-back, share cancellation, shares held as treasury shares and resale
            of treasury shares during the current financial period ended 31 March 2006. Subsequent to 31 March 2006, the following occurs:-

              (a) On 13 April 2006, the Company had effected the capital reduction and share consolidation with the resultant issued and paid-up capital of
                  the Company is RM99,910,503.50 comprising of 199,821,007 ordinary shares of RM0.50 each.

        A7. Dividends Paid
            There was no dividend paid during the financial quarter ended 31 March 2006.




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        A8. Segmental Reporting

              Primary reporting format
              - business segment
                                                                                                                   3 months ended
                                                                                                             31.03.2006      31.03.2005
              Segment Revenue
              Revenue from continuing operations:
                   Construction                                                                                     3,332            22,934
                   Property development                                                                               237             7,164
                   Hotels and Resorts                                                                                 334               339
                   Others                                                                                             527               350
                   Total revenue including inter-segments sales                                                     4,430            30,787
                   Elimination of inter-segments sales                                                               (835)          (15,863)
                   Total revenue from continuing operations                                                         3,595            14,924
              Revenue from discontinued operation                                                                     -                 -
              Total                                                                                                 3,595            14,924

              Segment Results
              Results from continuing operations:
                   Construction                                                                                     (3,390)              451
                   Property development                                                                              2,773                 7
                   Hotels and Resorts                                                                                 (181)             (168)
                   Others                                                                                              146                (1)
                   Total results from continuing operations                                                           (652)              289
              Unallocated income                                                                                       503               665
              Results from discontinued operation                                                                       (1)               (1)
              Total                                                                                                   (150)              953




        A9. Valuations of Property, Plant and Equipment
            The values of property, plant and equipment have been brought forward without amendment from the previous annual financial statements.

       A10. Subsequent Material Events
            There was no material event occurring subsequent to the end of the interim period that have not been reflected in the financial statements for the
            said period.

       A11. Changes in the Composition of the Group
            There were no business combination, acquisition or disposal of subsidiaries and long-term investments, restructuring or discontinuing operations
            for the current financial period ended 31 March 2006, except as follows:-

              (a) On 27 January 2006, Transbay Ventures Sdn Bhd, a subsidiary company of the Company has been wound up by the Kuala Lumpur High
                  Court pursuant to the winding-up petition instituted by Public Bank Berhad. The effect of this winding up has been reflected in the audited
                  financial statements for the year ended 31 December 2005.

              (b) On 21 February 2006, the High Court of Singapore has granted to Pilecon Engineering Berhad, Singapore branch, the order to convene a
                  meeting for its creditors for the purpose of considering and, if thought fit, approving a scheme of arrangement pursuant to Section 210 of the
                  Singapore's Companies Act, Cap 50.

              (c) On 28 March 2006, Pilecon Realty Sdn Bhd, a wholly-owned subsidiary company of the Company, had entered into a Sale of Shares
                  Agreement with Fono Front Sdn Bhd for the disposal of its entire interest in Mawal Awal (M) Sdn Bhd comprising 300,000 ordinary shares
                  of RM1.00 each representing 100% of the total issued and paid-up capital of Mawal Awal (M) Sdn Bhd for consideration of RM1,604,000.


       A12. Commitments and Contingencies

              (a) Contingent Liabilities
                  Contingent liabilities of the Group include the following:-
                                                                                              As at             As at           Increase/
                                                                                           31/12/2005        22/05/2006        (Decrease)
                                                                                            RM '000           RM '000         for the period

                   Guarantee given in connection with unsecured facility granted to a
                   associated company                                                               615               629                 14


                                                                                                    615               629                 14




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              (b) Capital Commitments
                                                                                             As at              As at           Increase/
                                                                                          31/12/2005         22/05/2006        (Decrease)
                                                                                           RM '000            RM '000         for the period
                   Capital commitments:-
                   - contracted but not provided for in the accounts                               31,371          31,371                -

                   Danaharta Managers Sdn Bhd ("Danaharta") had in October 2001 called up the Company's Corporate Guarantee with respect to a joint
                   venture agreement entered into by its subsidiary company for the property development rights. The Company is proposing resolving the
                   matter with Danaharta via its corporate proposal as mentioned in Item B8 herein. The Company has made a provision of RM63 million
                   arising from the said corporate guarantee for the financial period ended 31 December 2003.


        B. KLSE LISTING REQUIREMENTS

        B1. Review of Performance of the Company and its Principal Subsidiaries

              During the financial quarter under review, the Group recorded a turnover of RM3.6 million with operating loss before share of profits from
              associated companies of RM5.8 million. The loss of the Group is due to lower turnover recorded attributable to delayed property launched and
              continued high finance cost.


        B2. Comment on Financial Results (current quarter compared to immediate preceding quarter)

              The Group recorded a turnover in the first quarter of 2006 of RM3.6 million as compared to RM6.3 million in the fourth quarter of 2005. The
              Group's loss before tax in the first quarter of year 2006 was RM3.6 million as compared to loss before tax of RM40.8 million in the fourth
              quarter of 2005. The lower loss recorded for the first quarter of 2006 as compared to the loss recorded for the fourth quarter of 2005 is due to
              provisions made in fourth quarter of 2005 for bad debts and allowance for write down of inventories.


        B3. Prospects for the Current Financial Year
            The directors are of the opinion that the performance of the Group for the current financial year remains challenging.

        B4. Variance of Actual Profit from Forecast Profit
            Not applicable.

        B5. Taxation
            No provision of taxation is required to be made for the financial year under review.

        B6. Profit on Sale of Investments and/or Properties
            There was no sale of investments and/or properties for the current financial period ended 31 March 2006.


        B7. Quoted Securities
            (a) There was no purchase or disposal of quoted securities for the current financial period ended 31 March 2006.

              (b) Investment in quoted securities as at 31 March 2006 :-

                                                                                                             RM ' 000
                        At cost                                                                                  23,728
                        At carrying value / book value                                                           13,136
                        At market value                                                                          13,136




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        B8. Status of Corporate Proposals

              On 12 January 2006, the Company obtained confirmation and sanction of the High Court of Malaya at Kuala Lumpur for revised proposals
              pursuant to Sections 64 and 176 of the Act. On 12 January 2006, the Company had fixed the conversion price of the "Debt-to-Equity", RCSLS
              and ICULS to be issued pursuant to the PDRS at RM0.50 nominal value for one new ordinary share of the Company.

              On 3 March 2006, the Company obtained approval-in-principal from Bursa Malaysia for the listing of and quotation for the ICULS and the listing
              of and quotation for the new ordinary shares of RM0.50 each in the Company to be issued pursuant to the Rights Issue, "Debt-to-Equity"
              Conversion and upon conversion of the RCSLS (if any) and ICULS.

              On 13 April 2006, the Company had effected the capital reduction and share consolidation with the resultant issued and paid-up capital of the
              Company is RM99,910,503.50 comprising of 199,821,007 ordinary shares of RM0.50 each.

              On 8 May 2006, the Securities Commission had approved the extension of time of 6 months from 13 May 2006 to 12 November 2006 to
              complete the implementation of the revised proposals.




        B9. Group Borrowings and Debt Securities                                                                                 As at
                                                                                                                               3/31/2006
                                                                                                                                RM '000
              (a)       Short term borrowings
                         - Unsecured                                                                                                272,423
                         - Secured                                                                                                      -
                         - Portion of secured long term loan repayable within the next 12 months                                         23
                                                                                                                                    272,446

                        Included in the Other Payables is interest accrued of RM70.6 million and included in the Provision for liabilities is
                        provision of corporate guarantee of RM75.0 million.

                                                                                                                                 As at
                                                                                                                               3/31/2006
                                                                                                                                RM '000
              (b)       Long term borrowings
                         - Secured                                                                                                      710
                         - Portion of secured long term loan repayable within the next 12 months                                        (23)
                                                                                                                                        687


              (c)       Total loan in foreign currency
                                                                                                           In Respective      In Equivalent
                                                                                                            Currencies           RM'000


                                                       Singapore Dollar - S $                                     774,626             1,765
                                                                                                                                      1,765


       B10. Off Balance Sheet Financial Instruments
            There was no financial instrument with off balance sheet risk as at 22 May 2006, being the latest practicable date which shall not be earlier than 7
            days from the date of issue of the quarterly report.

       B11. Material Litigations
            The material litigations of the Group as at 22 May 2006 involving claims exceeding RM5 million are:-


               i)       Claim filed by Pilecon Geotechnics Sdn Bhd (“PGSB”), a wholly owned subsidiary company of the Company, on 11 August 2000
                        against Paul Y Construction Sdn Bhd (“PYCSB”) in respect of a subcontract for piling and substructure works at JB Landmark for an
                        outstanding sum of RM5,901,961.62, losses and expenses amounting to RM5,668,412.78 and the sum of RM2,250,000.00 which was
                        wrongfully withheld by PYCSB, amounting to total of RM13,380,374.40. PYBSB is counter-claiming for the sum of RM6,773,913.98
                        and RM191,050.93 together with damages, reimbursements and/or compensation and/or restoration. The solicitors expect the
                        commencement of trial to be sometime in late 2006 and they are of opinion that PGSB will probably succeed in a major portion of their
                        claim while PYCSB’s counterclaim will probably be dismissed.

               ii)      E & E Equipment Sdn Bhd (“E&E”), a wholly owned subsidiary company of the Company has on 25 August 1999 filed a Writ of
                        Summons and Statement of Claim against Speci Avenue (M) Sdn Bhd (“SA”) claiming for instalment payments amounting to
                        RM9,432,859.64 made on behalf of SA to various finance companies for hire purchase of fourteen (14) cranes. Judgement in Default
                        had been initially obtained against SA but was set aside on 9 June 2000. This matter is now fixed for mention on 7 August 2006.




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               iii)     Constrajaya Sdn Bhd (“CSB”) filed a claim on 6 August 2001 against Johor Coastal Development Sdn Bhd (“JCD”), a subsidiary
                        company of the Company, for the refund of RM9,018,400.00 being part of the purchase price paid for Lots 7 and 14 of Parcel C at
                        Johor Bahru Waterfront City (“JBWC”). The High Court allowed CSB's claim. On appeal, the Court of Appeal reduced the amount to
                        be refunded to RM7,148,000.

                        Both parties have now appealed to the Federal Court. Meanwhile, the Court has dismissed JCD's application to stay execution of the
                        Order to refund the balance of the purchase price amounting to about RM7,148,000 to CSB. Consequently, CSB has on 21 November
                        2005 served Section 218 Notice on JCD, to be followed by a Petition to wind up JCD if the judgment sum is not settled within 21 days.
                        Although it is unlikely that a defence to the anticipated winding-up Petition can be successfully mounted, JCD is nevertheless
                        attempting to negotiate a settlement with CSB.

               iv)      Maxson Resources Ltd (“MRL”) in Hong Kong has been granted RM11,500,000.00 against Pilecon Industrial Engineering Sdn Bhd
                        (“PIE”), subsidiary company of the Company under an arbitration award in 2001. However it is unlikely that MRL will ever be able to
                        enforce this Award in Malaysia against PIE because the Award was obtained in defiance of an Injunction granted by the Kuala Lumpur
                        High Court that the arbitration proceedings be stayed. Although PIE has counterclaimed against MRL for RM16,986,435.00 under the
                        same arbitration proceedings, it is unlikely that PIE will pursue its counterclaim by reason of the Injunction.


               v)       Arbitration claim filed on 25 April 1998 by Pilecon Building Construction Sdn Bhd (“PBCSB”), a wholly-owned subsidiary company of
                        the Company, against Likas View Sdn Bhd (“LV”) for recovery of a total sum RM6,879,483.83 against LV on following disputes:

                        1. Default of payment on Cert. No. 25 amounting to RM1,438,700
                        2. Breach of contract on non-certification of Progress Claim No. 26, 27 & 28
                        3. Wrongful termination of contract by LV

                        LV is contending that their determination of contract is rightful and is counterclaiming for liquidated damages amounting to
                        RM2,310,000 and claim for completing outstanding works & remedial works amounting to RM5.8 million. The arbitration has been
                        adjourned sine die because order to wind up PBCSB has been granted on 17 April 2003. However, PBCSB is seeking the consent of
                        the Official Receiver to continue with the arbitration proceedings, which have since been stayed. Our solicitors are confident that the
                        arbitration award will be very much in PBCSB's favour.

                        PBC was subsequently wound-up on 17.04.2003. However, PBC is seeking the consent of the Official Receiver to continue with the
                        arbitration proceedings, which have since been stayed. Our solicitors are confident that the arbitration award will be very much in our
                        favour.

              vi)       Winding-up Petition filed by PGSB against Torie Development Sdn Bhd (“Torie”) on 17 January 2000 for an outstanding sum of
                        RM6,565,410.50 being the balance for the progress payments of piling works for the project known as Pembangunan Komersil 11
                        Tingkat Mengandungi Ruang Perniagaan, Ruang Pejabat Serta Tempat Letak Kereta Di Atas Lot PTB 20218, Bandar Johor Bahru.
                        Torie has breached the terms of the Settlement Agreement dated 23 February 2001 whereby Torie had agreed to pay the settlement sum
                        by way of 36 monthly installments commencing from 1 September 2001.

                        Torie was wound up on 30 September 2002 pursuant to Section 218 of the Companies Act, 1965. It has filed an application for a stay
                        of the Winding-Up Petition and their application was dismissed with costs. Torie has on 7 July 2005 withdrawn their appeal against the
                        High Court decision. However, chances of recovering any portion of the debt are slim as Torie appears insolvent.


              vii)      Claim filed on 10 March 2000 by Sungai Wang Plaza Sdn Bhd (“SWP”) against Low Yat Plaza & Sons Realty Sdn Bhd, Low Yat
                        Construction Company Sdn Bhd (“Low Yat”) and PGSB for the sum of RM6,393,896.07 being damages and losses caused by
                        subsidence, movement and cracks to SWP’s property due to PGSB’s activities in the adjoining land. PGSB has successfully applied to
                        include its insurers, The People’s Insurance Company (M) Bhd as third party to the proceedings, and is confident of claiming full
                        indemnity against the third party. The trial dates are on 16 February 2008 to 22 February 2008.


              viii)     PGSB filed a Statement of Claim against Low Yat for RM8,374,435.28 for outstanding balance of substructure structural works
                        completed for Low Yat’s 40 storey building at Jalan Bukit Bintang, Kuala Lumpur. Low Yat has counter claimed for RM6,990,000.00
                        for Liquidated Ascertained Damages (“LAD”), and special damages of RM87,774.73. The matter is fixed for case management on 7
                        July 2006.

                        PGSB’s solicitors are of opinion that although some of Low Yat’s claim for LAD may be allowed, PGSB shall recover a substantial
                        amount of its claim at the end of the trial.

              ix)       Claim filed on 5 February 2003 by Affin Bank Berhad, Bumiputra-Commerce Bank Berhad, RHB Bank Berhad, Southern Bank Berhad
                        and Public Bank Berhad against the Company for a collective sum of RM157,325,000.00 under a Guarantee Facility Agreement and
                        Letter of Undertaking. Appearance was filed on 3 March 2003. The solicitors are of the opinion that the chances of defending this
                        matter is rather weak. The amount claimed is currently being restructured under the Company's restructuring exercise.


              x)        Claim filed on 7 October 2002 by Alliance Bank Malaysia Berhad (“ABMB”) against PDX Teknologi Sdn Bhd (“PDX”) for the sum of
                        RM4,603,185.05 together with interest at the rate of 9.9% on the outstanding amount under an Overdraft Facility granted to PDX. The
                        Company was also sued as guarantor under a Letter of Guarantee dated 12 May 1993. No date has been given for hearing for the
                        plaintiff's application for summary judgment. The solicitors are of the opinion that the chances of defending this matter is rather weak.
                        The amount claimed is currently being restructured under the Company's restructuring exercise.




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              xi)          Claim filed on 28 December 2001 by Public Bank Bhd (“PBB”) against Transbay Ventures Sdn Bhd (“TVSB”), a subsidiary company
                           of the Company, for a Bridging Loan Facility granted for the amount of RM13,860,089.29. On 22 August 2003, the Court gave
                           judgment in PBB’s favour for RM17,081,150.53. On 20 May 2004, PBB served Section 218 Notice on TVSB. The Court wound up
                           TVSB on 27 January 2006. TVSB's appeal against the winding-up order has been dismissed by the court.

                           Foreclosure proceedings commenced on 22 June 2002. Auction on 1 June 2005 attracted no bidders. Second auction date is yet to be
                           fixed by Court.

              xii)         Legal action was commenced on 22 May 2001 by Kenworth Engineering Ltd (formerly known as UDL Kenworth Engineering Ltd)
                           against the Company for the followings:

                           a) HK$8,401,504.41 for labour and materials supplied for electrical and mechanical works;
                           b) Damages in the sum of HK$4,326,114.02; and
                           c) Sum of HK$2,107,768.24 for costs of additional work and the use of additional labour and costs and reasonable costs incurred by
                           reason of unavoidable delay and disruption of working.

                           The Company counterclaimed HK$13.1 million being the liquidated damages and other cost reimbursement. The Plaintiff and
                           Defendant are currently exchanging witness statements and experts' reports. No trial date has been fixed.

              xiii)        On 14 October 2004, JCD filed an action against the Land Administrator in Johor Bahru High Court to set aside the order dated 12
                           August 2004 forfeiting the 9 lots of Waterfront lands.

                           On 7 July 2005, the High Court declared the forfeiture invalid. The Land Administrator's appeal to the Court of Appeal has been
                           dismissed. The Land Administrator has been given leave to appeal to the Federal Court in respect of the validity of the Notice of
                           Demand for payment of quit rent (Form 6A), but has been refused leave to appeal against the validity of the Notice of Forfeiture (Form
                           8A). No hearing dates have been fixed for the appeal on the Form 6A.

              xiv)         By a letter dated 11 August 2004, the State Government purported to terminate the Privatisation cum Development Agreement dated 3
                           April 1993 (“the said Agreement”) between JCD and the State Government for the development of JBWC, due to alleged breaches of
                           the said Agreement.

                           JCD's solicitors are currently referring the dispute with the State Government to arbitration pursuant to the terms of the said Agreement.
                           JCD's solicitors opinion is that, based on available documentary evidence, JCD stands an even chance of challenging the validity of the
                           termination by the State Government.

              xv)          Pilecon Civil Works Sdn Bhd (“PCW”), a wholly owned subsidiary PEB, in March 2005, served S 218 Notice on Mayland
                           Development Sdn Bhd (“Mayland”) for RM1,876,436.77 being balance of certified payment for piling and foundation works for
                           Mayland's site at Jalan Kuching, Kuala Lumpur. Mayland then filed Statement of Claim for RM10,414,469.39 which they claimed is
                           the balance owing to them after off-setting our claim against the LAD imposed on PCW and against their losses and damages suffered.
                           Mayland also filed injunction to restrain PCW from filing winding-up proceedings. Parties have agreed to refer disputes to arbitration.



       B12. Proposed Dividend
            The Directors do not recommend any dividend for the quarter under review.

       B13. Earnings Per Share (EPS)

                                                                                                CURRENT           PRECEDING           CURRENT          PRECEDING
                                                                                                  YEAR               YEAR               YEAR             YEAR
                                                                                                QUARTER          CORRESPONDING        TO DATE        CORRESPONDING
                                                                                                                   QUARTER                               PERIOD
                                                                                                31/03/2006         31/03/2005        31/03/2006        31/03/2005



                a) Basic Earnings
                      Net profit / (loss) attributable to shareholders (RM'000)                        (3,554)           (2,384)           (3,554)           (2,384)
                      Weighted average no of ordinary shares in use ('000)                          399,642            399,642           399,642           399,642
                      Basic earnings per share (sen)                                                    (0.89)            (0.60)            (0.89)            (0.60)

                b) Diluted Earnings
                      Not applicable.                                                        Not applicable       Antidilutive     Not applicable.    Antidilutive


       By Order of the Board


       Shah Alam
       26 May 2006




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