Chairman's Statement
On behalf of the Board of Directors, I am pleased to present Golsta Synergy Berhad's Annual Report and Audited Financial Statements of the Group and of the Company for the financial year ended 31 December 2010.
OVERVIEW ON GROUP'S OPERATIONS AND FINANCIAL PERFORMANCE
In the financial year 2010, the Group's overall sales performance was commendable with an about 20% increase in operating revenue to RM28.86 million from RM24.11 million in preceding year, which was mainly due to completion and delivery of several more industrial processing machinery and production lines, and provision of related engineering service to overseas customers from African and ASEAN countries. Besides, the oil palm seeds and seedlings sector in Indonesia had also contributed substantially to such increase.
Despite the increase in revenue, the Group experienced a pre-tax loss of RM0.13 million compared to the restated pre-tax profit of RM3.14 million in preceding year. Such loss was mainly due to the Group suffered a net foreign exchange loss of RM2.34 million in the current year compared to the restated net foreign exchange gain of RM1.73 million in prior year.
PROSPECT
Despite the recent political instability in Middle East which had drastically affected the global economy recovery, the demand for industrial processing machinery and production lines manufactured by the Group is still looking positive as the prices of agricultural commodities such as rubber, cocoa and palm oil are up-surging which have propelled the key players in these industries throughout the world to invest more on their new or replacement of their existing industrial processing plant and machinery. This continued expansion in demand both locally and overseas especially for African and ASEAN countries will auger well for the Group's businesses in the short run.
The oil palm seeds and seedlings experienced a relatively higher market demand compared to previous years due to the proliferation of bio-fuel projects in developed and developing countries and the boom in the agricultural commodities sector. As such, the Group will be expecting further positive growth in revenue and profits from its Indonesian subsidiary towards the Group's overall performance.
CORPORATE RESTRUCTURING EXERCISE
In order to expand the capital base of the Group and the Company, the Board is considering to increase the Company's issued and paid-up capital from RM42 million to RM60 million to comply with the listing requirements of the Bursa Malaysia.
The said corporate restructuring exercise will include part or a combination of the following components:
- a rights issue to existing shareholders;
- a special issue to increase the Bumiputra equity; and
- the acquisition of quality assets which will provide stream of profits and cash flows in the near future.
Towards this end, the Board is in the process of seeking appropriate Bumiputra investors; seeking viable businesses with quality assets and appointing corporate advisors to advise and undertake the said capital restructuring exercise. The Board will keep the shareholders informed the outcome of the said exercise in due course.
ACKNOWLEDGEMENT
I wish to thank our fellow Directors, management and staff for their unwavering hard work and immense contributions during the year, which enable us to achieve our goals and vision for us to move forward in the forthcoming years.
To all our valued suppliers, customers, bankers, business associates, advisers, regulatory authorities which we have been dealing with over the years, we thank you for your invaluable supports to the Group.
Last but not the least, on behalf of the Board I wish to thank all our valued shareholders for your loyalty and trust towards our Group.
PUAN SRI DATIN MINUIRA SABKI
Chairperson
3 June 2011
Melaka