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P O S M A L AY S I A A N N UA L R E P O RT 2 0 0 9

F O C U S

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COVER AND BACK PAGE

COVER AND BACK PAGE

F O C U SOur journey towards excellence

continues with the launch of Pos

Malaysia’s Transformation Master Plan

(TMP). Our TMP, anchored on 5 pillars

themed “FOCUS” aims to rejuvenate

Pos Malaysia to become the pride of

customers, employees and the nation.

We pledge to FOCUS our efforts on

delivering value to you.

INSIDE COVER AND FIRST PAGE

INSIDE COVER AND FIRST PAGE

Pos Malaysia Annual Report 2009 1

POS MALAYSIA ANNUAL REPORT 2009

Pos Malaysia Annual Report 20092

Group Financial Highlights

0908070605 0908070605 0908070605

Revenue Operating Profit EBITDA

2009 2008 2007 2006 2005

ProfitabilityProfit before taxation RM million 109.3 (0.5) 15.5 155.9 166.3

Operating margin % 9.1 9.4 11.8 13.2 13.9

EBITDA margin % 14.5 13.7 16.9 18.0 18.9

Return on Assets % 5.9 6.2 7.9 8.1 8.6

Return on Equity % 9.6 (4.4)* (3.9)* 11.5 18.6

Balance SheetTotal Assets RM million 1,274.6 1,537.8 1,247.1 1,326.0 1,333.8

Total Equity Attributable to Equity Holder of the Company RM million 799.6 764.5 859.4 938.0 900.5

Current Ratio times 1.2 1.1 1.3 2.2 1.9

Staff InformationNo. of Staff 15,780 16,125 15,777 15,425 15,063

Staff Costs RM million 512.3 513.3 456.4 427.7 425.1

Revenue per employee RM’000 57.2 57.2 54.5 53.2 52.2

* Note: Return on Equity (ROE) is negative due to allowance for impairment losses. Excluding impairment, ROE stood at 10.8% and 12.5% for 2008 and 2007 respectively.

786

820

859

922903

109 108

101

86 82

148 148

145

127 131

RM M

ILLI

ON

RM M

ILLI

ON

RM M

ILLI

ON



0908070605 0908070605 0908070605

Profit After Tax Earnings Per Share (Basic) NTA Per Share

Revenue Breakdown Operating Expenses Breakdown

Mail

Courier

Retail

Others

Maintenance & Supplies

Rental, Communications & Utilities

Depreciation & Amortisation

Raw Materials & Consumables

Transportation

Staff Costs

Other Operating Expenses

167

108

(34) (33)

77

31.120.2

(6.3) (6.2)

14.39.2 9.6

1.6 1.4 1.5

SEN

RM M

ILLI

ON

RM

62%

18% 5%

15%

62%

13%

6%

6%

6%

2%

5%RM 903 mil RM 820 mil


MAIL BUSINESS COURIER BUSINESS RETAIL BUSINESS

MO

VIN

GFO

RWA

RD

2009

AC

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MPL

ISH

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Revenue RM562.3 mil (down 0.6%)• Volume: 1,241.4 mil items (down 2.3%)• Revenue contribution: 62.3%•

Gold Award for the Universal Postal • Union’s (UPU) Quality Management Certification ProgrammeParticipated in the trial of UPU’s Global • Monitoring System; an RFID based service quality monitoring systemEmbarked on delivery beat recasting• Started deployment of an Electronic • Prepaid Mail Transaction System

Rationalised international lanes for cost • savings and improved profitabilityIntroduced• shipment tracking via SMSReader’s• Digest Trusted Brand AwardsFrost• & Sullivan Asia Pacific Transportation & Logistics Awards for Domestic Express Service Provider of the Year (Malaysia)MSC• Malaysia APICTA as the Best e-Logistics for PITTISBrand• Laureate AwardsInternational• Business Review Awards for excellence in government delivery servicesIntroduced• Electronic Shipping Tools (EST) to premium customers which handles large shipments.

Introduced Shared Banking Services • with RHB BankIntroduced Pos Automated Machine • (PAM)Launching of Pos-on-Wheels• New Look & Feel for KL GPO and • Kuantan GPOAddition of Affin Bank, Al-Rajhi Bank • and EON Bank as payment gateway for PosOnline

Revenue RM167.0 mil (up 2.7%)• Volume: 14.6 mil items (up 5.0%) • Revenue contribution: 18.5%•

Revenue RM139.0 mil (down 3.2%)• Volume: 107.6 mil transactions (down • 6.5%)Revenue contribution: 15. 4%•

Establishing network relationship with • international courier providers to develop new business opportunities

Crafting new Retail Strategy• Focus on financial services/products and • postal products

Develop Direct Mail• Grow parcel business• Capitalise on new business • opportunities in Corporate Mail Management

Business Highlights



POS MALAYSIA BERHAD

SHARE PRICE PERFORMANCE

POS Volume POS Share Price

RM2.02 as at2 Jan 2009

RM2.22 as at31 Dec 2009

2009 JAN FEB MAR MAY JUNE JULY AUG SEPT OCT NOV DECAPR

Total Monthly Volume

Monthly High (RM)

Monthly Low (RM)

Monthly End Closing Price (RM)

5,762,700

2.04

1.98

2.02

4,665,900

2.20

2.03

2.03

4,841,400

2.14

2.05

2.12

2,923,000

2.23

2.10

2.23

1,869,000

2.50

2.22

2.39

3,402,500

2.54

2.14

2.20

3,075,600

2.34

2.01

2.34

2,744,700

2.47

2.18

2.20

4,436,200

2.35

2.11

2.28

1,842,700

2.43

2.21

2.31

1,822,600

2.42

2.12

2.36

5,307,300

2.31

2.12

2.22

JAN FEB MAR APR MAY JUNE JULY AUG SEPT OCT NOV DEC



OUR BUSINESS AND ACCOMPLISHMENTS

Contents

18th

Annual General Meeting12 May 2010The Legend Grand Ballroom,Legend Hotel Kuala Lumpur,Level 9, Putra Place,100, Jalan Putra,50350 Kuala Lumpur

Cover Rationale

Group Financial Highlights

Business Highlights

Share Price Performance

Our Business & Accomplishments

Chairman’s Statement

Group Managing Director / CEO’s Report

Accolades and Awards

Mail Business

Courier Business

Retail Business

Group Products & Services

Corporate Events

Pos Malaysia in the News

Our Profile

Corporate Information

Group Structure

Board of Directors

Leadership Team

Our Commitment

Corporate Social Responsibility Statement

Corporate Governance Statement

Statement of Internal Control

Directors’ Responsibility Statement

Additional Compliance Information

Audit Committee Report

Directors’ Report & Financial Statements

Directors’ Report

Balance Sheet

Income Statement

Statement of Changes in Equity

Cash Flow Statements

Notes to the Financial Statements

Top 10 Properties

Analysis of Shareholdings

Notice of 18th Annual General Meeting

Proxy Form

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04

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06

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26

30

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Dear Valued Shareholders,It is my pleasure to present to you the Annual Report and

Audited Financial Statements of the Group for the financial

year ended 31 December 2009.

The Group posted revenue of RM902.6 million for 2009,

lower than 2008 performance of RM921.7 million. The

revenue decline of 2.1% was recorded amidst weak economic

conditions which adversely affected mail volume. Despite the

drop in revenue, the star t of our transformation effort has

managed to reduce the impact whereby operating profit only

declined by RM3.9 million from RM86.2 million in 2008 to

RM82.4 million in 2009.

2009: Weathering the TurbulenceThe recession in 2009 was unprecedented in its scale and

impact. The first quarter of the year was heavily influenced by

the massive de-risking as volatility and risk aversion pushed

investors to unwind their positions. In the second half of the

year, government and central bank support was a key driver to

help inch positive readings back to macroeconomic indicators.

Pos Malaysia weathered through this difficult period through

intensifying cost management. Cost mitigation measures and

process improvement initiatives were aggressively pursued

in 2009. In line with the measures taken, the Group saw

operating expenses declined by RM15.2 million to close at

RM820.2 million.

2009 Headline Key Performance Indicators (KPI)The 2009 Headline KPI achievement showed mixed

results. The Group managed to surpass its Earnings Before

Interest, Taxes, Depreciation and Amortisation (EBITDA)

and Return on Assets (RoA) Headline KPIs. Pos Malaysia

recorded EBITDA of RM131.3 million, slightly above the

target of RM130 million, whilst RoA was at 5.9% against the

announced Headline KPI of 4.5%. The achievement is in line

with cost management measures adopted by the company.

However, Pos Malaysia missed its Revenue Headline KPI of

RM940 million by 3.8%.

Dividend PayoutPos Malaysia remains committed to its Dividend Policy of

declaring at least 35% of net profit as dividend. Our Dividend

Policy defines net profit as net profit after tax excluding

one-off exceptional/extraordinary items such as impairment

and capital gains. For 2009, the net profit attributable to

shareholders excluding minority interests and exceptional

items stood at RM70.5 million.

“Cost mitigation measures and process improvement initiatives were aggressively pursued in 2009.”


12 Pos Malaysia Annual Report 2009


I am pleased to report that the Board of Directors is

proposing a final dividend of 12.5 sen per ordinary share

less 25% income tax to be paid out to the shareholders

for the financial year ended 31 December 2009, subject to

shareholders’ approval at the 18th Annual General Meeting

of Pos Malaysia. This translates into net dividend payout of

71.4% of net profit, 36.4% higher than the minimum payout

ratio declared in the Dividend Policy.

AwardsEven in difficult times Pos Malaysia continues to deliver

outstanding services and this is recognised by the array of

awards bestowed on to the Group. Pos Malaysia garnered

the Universal Postal Union’s (UPU) Quality Management

Certification Programme Gold Award for 2009. PosLaju

continues its winning streak with the Reader’s Digest

Trusted Brand Gold Award for the fourth consecutive year.

PosLaju also clinched the Frost & Sullivan 2009 – Asia Pacific

Transportation & Logistics Award for Domestic Express

Service Provider of the Year. Pos Malaysia’s continuous effort

to leverage on Information and Communications Technology

was also recognised when it won the MSC Malaysia Asia

Pacific ICT Award, as the Best in e-Logistics Category for

our development of a track and trace system.

2010: The First Year of the Transformation Master PlanThe macroeconomic outlook for Malaysia and other emerging

market economies is positive. However, we need to remain

cautious as concerns remain on the sustainability of the global

recovery as well as added downside risks from withdrawal of

government support in developed economies.

The postal industry, both globally and locally will continue

to be a challenging environment as it continues to face

an unprecedented level of competition from electronic

communications. While we do not expect to see a free fall

in letter mail volumes, there does appear to be a systemic

decline especially with transactional letter mails. However

the same trend in electronic communications is also

providing real growth oppor tunities as more goods are

being ordered online.

The launch of Pos Malaysia’s Transformation Master Plan is

timely in addressing the challenges and seizing opportunities

that surfaced as a result of the downturn. Cost management

initiatives will be accentuated with the redesign and

enhancements to operations and functions so as to deliver

optimum productivity. New growth opportunities will

also arise through leveraging on previously under utilised

strengths within the Group especially with its courier and

retail businesses which will help to reduce our dependency

on mail.

13Pos Malaysia Annual Report 2009

Board ChangesThe Board of Directors would like to welcome to the

Pos Malaysia Berhad Board of Directors Tan Sri Dato’ Ir.

Muhammad Radzi bin Haji Mansor and En. Haizan bin Mohd

Khir Johari who were appointed on 21 October 2009 and

23 February 2010 respectively as Non Independent Non

Executive Directors. Tan Sri Dato’ Ir. Muhammad Radzi brings

with him a wealth of knowledge and experiences for more

than 20 years in the telecommunications industry including

as Chairman and Director at Telekom Malaysia Berhad from

1999 to 2009. En. Haizan is currently Senior Vice President,

Investments at Khazanah Nasional Berhad.

Pos Malaysia weathered through the turbulence of 2009

through the strength and support of all our stakeholders.

We would like to extend our hear tfelt gratitude and

appreciation to all those who have been instrumental in

helping us cope with the difficult conditions: our staff for

their unwavering dedication and sacrifices, the Unions for

their collaboration and our customers and par tners for their

continuous support.

The Board of Directors and Management of Pos Malaysia

Berhad would also like to extend its sincere appreciation to

YBhg Datuk Abu Huraira bin Abu Yazid for his contributions

as Executive Director/Group Chief Operating Officer (ED/

GCOO). Datuk Abu Huraira’s term as Executive Director

ceased pursuant to the expiration of his term of service as

ED/GCOO of the Company with effect from 1 August 2009.

Datuk Abu Huraira also subsequently resigned as Director

effective 1 August 2009 and has been appointed as Chairman

of SOCSO effective the same day. We wish him all the best

in his current role.

Lastly, we would like to thank our loyal shareholders for their

continued trust and faith in Pos Malaysia. With the support of

all our stakeholders, Pos Malaysia will endeavour to deliver its

best in the years ahead.

Sincerely,

Tan Sri Dato’ Seri (Dr.) Aseh bin Haji Che Mat

Chairman



It has since been another trying year for the postal industry

worldwide amidst a turbulent global economy. Pos Malaysia

navigated through 2009 with intensified cost management

measures and revenue enhancement effor ts to battle severe

challenges from declining postal volume.

Sustained Performance Amidst AdversitiesIn 2009, Pos Malaysia achieved a total year end revenue of

RM902.6 million, underperforming 2.1% against the results

of RM921.7 million in 2008. Taking into consideration the

difficult business environment, Pos Malaysia’s performance

and achievement in 2009 is yet a commendable one.

“We see 2010 bringing greater opportunities for us, as we shift strategies

in line with the expected gradual economic recovery, capitalising on new growth

areas such as direct mail and emerging technologies to

facilitate e-commerceand delivery needs.”




Mail business continues to be the major source of revenue

despite declining mail volume, contributing RM562.3 million,

or 62.3% of the Group’s revenue. Courier business improved,

registering a 2.7% revenue increase to RM167.0 million, whilst

the retail business experienced a slight dip in revenue by

3.2% to RM139.0 million in 2009. Courier and retail business

contributed 18.5% and 15.4% to total revenue respectively

in 2009.

Operating expenses for 2009 registered at RM820.2 million,

lower by RM15.2 million from RM835.4 million in 2008. The

intensified cost management programme has contained

significant cost escalation. For example, staff cost is at the

same level as last year even with salary increases and bonus

payments while transportation cost has reduced by 13.6%

due to lower fuel prices.

Notwithstanding the prevailing difficulties in the economy,

Pos Malaysia emerged profitable in 2009. Operating profit

was slightly lower by 4.5% from RM86.2 million in 2008 to

RM82.4 million. On the other hand, Earnings Before Interest,

Depreciation and Amortisation (EBITDA) improved by

3.6% to RM131.3 million from RM126.7 million last year.

We recorded a profit before taxation of RM109.3 million

and net profit of RM76.7 million, as compared to a loss

before taxation of RM0.5 million and a loss after taxation

of RM33.3 million in 2008.

This was largely attributable to the effective cost optimisation

measures throughout the year and the absence of any

investment impairment provisions. The year also saw Pos

Malaysia consolidating its investments via disposal of

G-Force and the acquisition of the remaining 45% equity

interest in Digicer t.

Aligning People and StrategyOur people are our most treasured resources and they have

continued to support our growth in good and bad times. In

return, Pos Malaysia continues to provide opportunities for

learning and growth, career development as well as equipping

our people with the right skills and competencies to handle

value adding tasks and expanded roles. Our commitment

is evidenced through our “Growing Together Programme”

which saw qualified, performing non executive staff being

given opportunities to assist in undertaking responsibilities in

the execution of strategic initiatives.

At the same time, we fur ther recognise and reward our

people’s effor ts through the launch of Employee of the Month

and Employee of the Year Awards apar t from realigning

our reward framework to instil a high performance, profit

driven culture. During the year, the company revisited its

recruitment and resource planning strategy and redeployed

staff to better manage resources in difficult times.




Improving Customer Satisfaction Pos Malaysia’s commitment towards improving customer

satisfaction is evidenced by our improved Customer

Satisfaction Index (CSI) and Image Index (II) results. For 2009,

Pos Malaysia scored 3.9 out of 5.0 for CSI, which translates

into 78% satisfied customers, an increase by 2 percentage

point against preceding year with CSI score of 3.8. The

study measures customer satisfaction on Pos Malaysia’s

products and service level which was conducted by an external

consultant. The survey results showed improved satisfaction

levels for courier and retail business which achieved an index

of 4.0 respectively, while mail CSI is sustained at 3.8. The

customers are also satisfied with our new corporate identity

as reflected in improved Image Index (II) at 3.5 against 3.3 in

preceding year. All business segments showed improvements

in Image Index with scores for courier at 3.9, retail at 3.5 and

mail at 3.3 out of 5.0 respectively.


Enhancing Regulatory and International DevelopmentIn 2009, Pos Malaysia together with its policymakers

and regulators namely; the Ministry of Information,

Communications & Culture (KPKK) and the Malaysian

Communications & Multimedia Commission (MCMC),

achieved a milestone through the development of the

National Postal Strategy which sets the guiding principles for

the strategy formulation, objectives and action plans for the

reform, development and integration of the postal industry

in line with national economic objectives and Universal Postal

Union (UPU) postal strategy.

On the international front, Pos Malaysia’s re-election into

the Asia Pacific Post Cooperative Management Board in

Auckland, New Zealand during the Asia Pacific Postal Union

(APPU) Congress in March 2009 was testimony to our

regional leadership role.

As part of our contribution to improving quality of service

in the region, Pos Malaysia participated in the UPU-APPU

Regional Quality of Service Programme which commenced

in August 2008 and was completed in November 2009.

Consequently, Pos Malaysia won the Gold award for the

UPU Quality Management Certification Programme. In

addition, Pos Malaysia implemented the Global Monitoring

System (GMS) in our International Office of Exchange as

a first step towards enhancing delivery performance for

inbound international mail and thus, contributing to overall

international network enhancement.

Gearing Up for TransformationThe postal industry is at a precipice of change, driven by the

explosion of digital media and changing customer behaviours.

In recent years, letter volumes continue to decline at

unprecedented rates as companies seek cheaper alternatives

to drive down business costs. For Pos Malaysia, the status quo

is untenable.

Our Transformation Framework

We are compelled to respond to the new landscape and shape

our future. Having our business confronted with alarming mail

volume declines, escalating costs and threats of obsolescence

from abundant electronic substitutes, we had no choice but to

gear into a transformation mode for survival.

Acknowledging the challenges and the need to achieve

performance breakthrough, Pos Malaysia launched the 3-year

Transformation Master Plan (TMP). Our TMP is anchored

on a clear strategic direction: focus on our domestic core

business, namely mail, courier and retail in the next 3 years.




The TMP aims to develop a more customer-centric

environment to extend convenience and easier access to

our customers, along with improvements to our operational

efficiency and optimisation of our resources, allowing the

Group to pursue new business opportunities.

The TMP equips us with a road map that zeroes in on the

following pillars:

Focus on customer needs – Create new solutions to •

meet ever-changing customer demands;

Operational excellence – Leverage on the latest •

technological advances to improve efficiency;

Concentrate on core business – Anchoring on profitable •

business and doing away with the contrary;

Unleash talent and capabilities – Developing and •

nourishing talents to nurture future leadership team;

Strengthen image – Refreshing look and feel to our outlets •

and simplifying processes for customer satisfaction.

Within the pillars are 39 initiatives with comprehensive

execution plans. Management will be actively and regularly

monitoring the progress of the initiatives, and look forward

to sharing our fruition from rejuvenation throughout the

next 3 years. Though some quick wins have been realised, the

TMP would only yield most of its benefits in 2011 and 2012.

Early SuccessesThrough more effective management of resources, Pos

Malaysia managed to reduce its total number of employees

for the very first time. Total number of staff at 31 December

2009 was 15,780, down 345 from 16,125 a year earlier.

This was done through natural attrition and redesigning

certain processes. Key among them is our delivery beat

recasting initiative which saw the number of delivery beats

reduced, whilst at the same time allowing for the redeployment

of our employees. Upgrading of our procurement process

through demand aggregation as well as Group wide Quality

Improvement Team are yielding significant cost reductions.

Pos Malaysia also introduced the first ever Pos Automated

Machine (PAM), a self-service terminal capable of conducting

simple posting transactions, stamp purchases and bill

payments as part of our commitment to improve customer

experience and convenience.

In early 2010, Pos-on-Wheels was also launched, essentially a

mobile post office offering the full range of services, to reach

out to more convenient locations and rural areas.

Number of Staff Declined in 2009

0908070605

15,06315,425 15,777

16,125

15,780


In addition, extensive vibrant renovations have also been

carried out at our main branches as part of the re-branding

initiative, with every intention of revamping the total customer

experience at Pos Malaysia.

2010: Opportunities and ProspectsWe see 2010 bringing greater opportunities for us, as we

shift strategies in line with the expected gradual economic

recovery, capitalising on new growth areas such as direct

mail and emerging technologies to facilitate e-commerce and

delivery needs.

We pledge to FOCUS our efforts to SIMPLIFY our processes,

to better ENGAGE our people and customers, allowing us to

DELIVER more value to all our stakeholders.

Truly Yours,

Dato’ Syed Faisal Albar

Group Managing Director / Chief Executive Officer

The 16th ASEAN Postal Business Meeting in Phuket in January 2010

The Group will persist in offering its services to all Malaysians

affordably, while improving efficiency and service delivery.

We will go the distance to show how serious we are at

changing the way Pos Malaysia connects with consumers and

remain relevant always.


POS MALAYSIA ANNUAL REPORT 2009Accolades and AwardsACCOLADES AND AWARDS


Mail Business

The Quality Management System (QMS) which utilises

“lean management” concept at our 32 MPCs, has

been successful in simplifying the workflow, improving

efficiency and minimising waste. It has also improved

teamwork and created a “continuous improvement”

culture among the employees.

The National Mail and Parcel Hub (NMPH) project is

progressing as planned. The project aims to improve mail

sorting efficiency by consolidating four mail processing

centres in the Central region at a single facility in Shah

Alam with improved building design and workflow

with advanced systems and equipment. The project is

expected to be completed by the end of 2010 and will

see higher automation level and improve quality of mail

services to our customers.

Focus on customers’ needs •We continue to explore new technology in efforts to

provide customers with better and faster services. We

have developed the Electronic Prepaid Mail Transaction

System which allows our bulk mail customers to prepare

posting documents and enquire about posting history via

the Internet. This integrated system also allows our bulk

mailers to conduct their transactions at any of the mail

processing centres nationwide as well as purchase any of

our products, making it easier and more convenient for

Pos Malaysia as the designated postal operator in Malaysia

handles traditional mail business through its strategic business

unit, PosMel. Datapos Sdn Bhd, a wholly owned subsidiary of

Pos Malaysia manages the hybrid mail business, which offers

document and data processing services.

PosMel HighlightsMail business posted total revenue of RM562.3 million, a

marginal drop of 0.6% from RM566.0 million in 2008. The

decline in revenue against the preceding year was in line with

lower mail volume handled for the year, in particular the social

mail. In 2009, we handled 1.25 billion mail items, against 1.27

billion items in the preceding year. Key growth areas such as

parcel and transactional mail continue to record 25% and 1%

growth respectively. Thus far, mail remains the major revenue

contributor representing 62.3% of the Group’s revenue.

PosMel is supported by an extensive delivery network

comprising 32 mail processing centers (MPC), 387 delivery

branches, 4,482 street posting boxes, 103,198 P.O. boxes and

one international gateway at KLIA.

Operational excellence•During the year, PosMel embarked on various initiatives

to improve operational efficiency. Among others, we

are optimising delivery workforce and reducing costs

by implementing our beat recasting exercise.



customers. The system has now been deployed at thir ty

two locations in Klang Valley and will be progressively

extended to other states.

Pos Malaysia participated in the trial of a new service

quality monitoring system based on radio frequency

identification (RFID) technology that involves 21 postal

administrators. Developed by the Universal Postal Union

(UPU), the Global Monitoring System (GMS) aims to

measure inbound service quality for letter mail delivery.

Leveraging on our wide network of delivery postmen

and our effor ts to be closer to customers, we

extended the access points for customers to do simple

transactions such as purchase of stamps, purchase of

Pos Ekspres envelopes and posting of letters through

mobile postmen. Launched nationwide in April 2009,

this initiative to bring our products and services

closer to customers received encouraging response

from the public.

Strengthening ties and quality of services •We have par ticipated in various international and

regional postal forums to foster closer ties and develop

business par tnerships. In 2009, we par ticipated in the

Regional Workshop on Quality of Service for Asia-Pacific

Region under the New Approach to Field Suppor t for

Postal Administrations, which was organised by the

UPU with the cooperation of Asia Pacific Postal Union

(APPU). These workshops were held in Jakar ta in May

2009, in Ulaanbaatar, Mongolia in August 2009 and in

Male, Maldives in December 2009.



Datapos HighlightsDatapos provides total mailing solution from data processing (formatting and sor ting) to data printing, enveloping, bulk mailing

and delivery. The establishment was a strategic move to complement the array of services that Pos Malaysia offers and

penetrate into document and data processing market.

In 2009, Datapos registered a marginal increase in revenue of 0.4% from RM14.4 million to RM14.5 million, amid intense

competition and price war. Similarly, volume has increased by 20% from 51.1 million in 2008 to 61.3 million.

As part of our modernisation efforts, Datapos has introduced a tracing system known as Account Number Verification (ANV) for

customers to conveniently track and refer to the data processed.

Moving Forward Into 2010 Focus in coming year includes embarking on core business, in par ticular growing direct mail, parcel as well as hybrid mail

business. We will continue to foster business par tnerships with relevant organisations to expand the high growth areas. In

addition, we will continue to pursue operational excellence by streamlining the network structure and consolidating mail

processing centers in other regions within Malaysia.

Mail Business


Can a GPS find incomplete addresses?A postman can. He knows his area like the back of his hand through years of delivering mail, not to mention his familiarity with the locals. It’s experience, and that’s something no GPS has.


Courier Business

Operational excellence•In 2009, we embarked on a project to restructure

the existing delivery network for the Group’s high

value items. The Streamlining Network Structure

(SNS Project) is on-going and is expected to fur ther

improve the operational efficiency of express and

mail services.

Our effor ts to improve the international delivery

network by rationalizing the international lanes

utilisation (EMS vs Non EMS) saw cost savings and

higher profitability for some international lanes.

Focus on customers needs•During the year, we introduced the Electronic Shipping

Tools (EST) to our premium customers, which handles

large volume of shipments. EST provides convenience,

cost and time savings to our customers.

PosLaju has also introduced SMS service for customers

to track their shipment. Now, customers can choose to

do tracking via SMS or through www.poslaju.com.my.

Pos Malaysia operates its courier business through its strategic

business unit, PosLaju and PSH Express Sdn Bhd. For 2009,

courier business posted a consolidated revenue of RM167.0

million amidst a competitive and challenging environment, an

increase of 2.7% against 2008 performance.

PosLaju Highlights In 2009, PosLaju recorded RM165.2 million in revenue, an

increase of 3.1% from RM160.3 million in 2008, despite the

contraction in Malaysian economy. The increase in revenue

was attributed to increase in demand from contract customers

by 4.2% and retail customers by 1.9%. In tandem with the

increase in revenue, PosLaju recorded an increase in volume

by 5.0% from 13.9 million in 2008 to 14.6 million in 2009.

PosLaju contributes 18.5% of the total group revenue.

To date, PosLaju services are available at more than 1,217

outlets, leveraging on our vast network of post offices

and Pos Mini outlets, as well as 50 PosLaju centres, 274

authorised agents and 2 service centres. With more than

27% market share of domestic shipment, PosLaju is the

leading domestic courier company in Malaysia.



The scanners on web facility were deployed at post offices

nationwide to improve its track and trace capability. The

above effort allowed the Operation Application Layer

(OAL) system to provide the latest delivery status for

items processed at post offices.

In 2009, PosLaju opened the Batu Caves branch and

relocated two of its branches; PosLaju Bukit Mertajam

and PosLaju Melaka. PosLaju has appointed more

authorised agents in 2009 to provide greater accessibility

to customers nationwide. All these expansion plans

enable PosLaju to continue having the largest network

among any other courier company in Malaysia.

Recognition of excellence•PosLaju has won 5 industry awards in recognition of

its outstanding performance in the domestic courier

industry. These awards include the Reader’s Digest

Trusted Brand 2009, Brandlaureate Awards 2009 for

Best Brand under courier & express service category,

and the Merit Award by International Business Review

2009 for excellence in government delivery service.

For the first time in 2009, PosLaju has been selected

to receive Frost & Sullivan Asia Pacific Transpor tation

and Logistics Awards for Domestic Express Service

Provider of the Year (Malaysia) and the MSC Malaysia

Asia Pacific ICT Awards (APICTA) as the Best in

e-Logistics for its effor t in enhancing its service

quality and performance via the development of Pos

Integrated Track & Trace System (PITTIS).



Courier Business

Moving Forward In 2010Courier industry will remain competitive in 2010 and

to meet these challenges, Pos Malaysia will continue to

build on its strengths and introduce new and innovative

products to meet customers demand. Our courier business

is also looking at establishing network relationship with

international courier providers to develop new business

oppor tunities and increase revenue streams.

PSH Express HighlightsPSH Express, a wholly owned subsidiary of Pos Malaysia

Berhad, provides customised door-to-door courier services

to corporate clients under the brand name of AsiaXpressTM.

AsiaXpress offers corporate clients fast and reliable

solutions for the movement of time-sensitive documents and

parcels to more than 220 destination countries worldwide.

AsiaXpress’ clientele comprises mostly government ministries

and agencies, Government-Linked Companies, financial

institutions, law firms, oil and gas companies, engineering

firms and institutes of higher learning.

2009 was a challenging year for PSH Express against a backdrop

of global economic crisis. In tandem with the economic

slowdown, overall shipment volume for PSH Express fell 11%

mainly due to a dip in demand for international shipment

which was mitigated by a growth in volume of 13% from

domestic shipment. Despite a softer demand for international

shipment, PSH Express posted revenue of RM4.2 million.

During the year, PSH Express focused much of its efforts

towards the improvement of the online shipping system

“X-Ship” to be a more user-friendly, efficient and robust

shipping tool for customers. 2009 marked another notable

milestone for PSH Express when it was awarded the

prestigious Industry Excellence Award 2009 – Certificate of

Excellence in the Export (Services) category by the Ministry

of International Trade and Industry in recognition of its par

excellence performance.


“Pos Malaysia will continue to build on its strengths and introduce

new and innovative products to meet

customers demand.”



Retail Business

Pos Malaysia’s retail service is operated by PosNiaga, one of its strategic business units. PosNiaga has the largest footprint in the

country, managing more than 1,000 outlets. It offers a wide variety of products and services through many channels; over-the-counter,

online and its recently introduced self service terminal to accept payment.

Retail Business Network Reach (as at 31.12.2009)

Post Offices 697

Pos Mini 352

Postal Agents 227

Stamp Vendors 5,087

Mobile Post Offices 1

Post Offices that can handle renewal of road tax/driving license 688

Post Offices at shopping complex 65

Post Offices with extended services beyond 7pm 24

Post Offices which open on Sundays/Fridays

(where Sundays/Fridays are weekend)

19

Pos Automated Machine (PAM) 1




PosNiaga HighlightsPosNiaga registered a drop in revenue by 3.2%, from RM143.6

million in 2008 to RM139.0 million in 2009. This was mainly due

to the completion of fuel cash rebate disbursement services

since 14 April 2009. In addition, PosNiaga also registered a

drop in the number of transactions handled from a total

transaction of 115.2 million to 107.6 million attributed mainly

by the reduction in utility bills and completion of fuel cash

rebate exercise.

Focus on customers need•True to its commitment to continuously provide

innovation for customers’ convenience, PosNiaga made a

maiden introduction of its new payment channel, namely

the Pos Automated Machine (PAM) in November 2009.

The first PAM terminal was placed at the Kuala Lumpur

General Post Office (KL GPO). PAM will be deployed in

stages, at twenty (20) selected locations throughout the

country in 2010.

PAM is essentially a self service terminal, similar to a

bank’s ATM machine with additional postal services,

the first of its kind in Malaysia. PAM offers purchase

of stamp label, posting of Non-Standard Letter, posting

of domestic PosLaju items, posting of domestic

PosParcel and PosDaftar items, top-up for Standing

Order Deposit Account (SODA) and bills payment.

During this familiarisation stage, the operation hours

for PAM are from 6:00 am to 11:30 pm daily (Monday

to Sunday). In future, PAM shall be made available 24

hours a day, 7 days a week.



In January 2010, PosNiaga launched “Pos-on-Wheels”

which offers range of services that is similar to a normal

post office. Pos-on-Wheels will be able to conduct

online transactions, such as buying and selling of

Amanah Saham units, Jabatan Pengangkutan Jalan (JPJ’s)

transactions and purchase of insurance, using satellite

connectivity. In 2010, PosNiaga plans to deploy more

units of Pos-on-Wheels, to serve the rural areas.

During the year, PosNiaga embarked on the new Look

& Feel initiative, creating a new image and conducive

environment for customers patronising our outlets. 2

outlets, KL GPO and Kuantan GPO have been renovated

according to the new Look & Feel in 2009. This will be

extended to other selected outlets, in stages.

Concentrate on core business via partnerships•Pos Malaysia believes in smar t par tnerships to complement and grow our business. Pursuant to the approval from Bank

Negara Malaysia (BNM) for Pos Malaysia to offer banking services, PosNiaga via its par tnership with RHB Bank introduced

the marketing of financial products at selected outlets. The services include application for ASB loan, personal loans and

credit card.

At present, we are at the tail-end of system integration test with both our par tners, RHB Bank and Maybank. Upon

completion, PosNiaga will be able to rollout other services under the Shared Banking Services, such as opening of bank

account, cash deposit, withdrawal and repayment of loans.

Retail Business


Addition of new payment gateway for PosOnline•In 2009, Pos Malaysia via PosOnline (www.posonline.

com.my) introduced new payment gateway providers,

namely Affin Bank, Al-Rajhi Bank and EON Bank, thus

expanding its customer base. With the addition of

these banks, PosOnline now has a total of 8 banks for

customers to have more choices for payment of bills

and online purchases.

Moving forward in 2010PosNiaga has to brace itself for enormous challenges;

competition with multiple service providers offering payment

channels in the market, as well as fast emerging technology

that influence consumer’s behaviour in doing transactions.

The changing landscape has led PosNiaga to transform its

business model. 2010 will see PosNiaga crafting a new retail

strategy in order to remain relevant in the marketplace. The

retail strategy will focus on few areas such as streamlining and

expansion of products/services and retail network structure.


DIGICERT SDN BHD

Digicert, the Licensed Certification Authority in Malaysia

which issues legally binding digital certificates, is a wholly

owned subsidiary of Pos Malaysia.

Key HighlightsDigicer t recorded revenue of RM10.5 million, down by

58.1% from RM25.1 million in 2008 due to the completion

of the one-off project of setting up the e-filing system for

Lembaga Hasil Dalam Negeri Malaysia (LHDNM) and the

subsequent diminishing volume in e-filing by first time users

evidenced by the drop in the number of digital cer tificates

issued from 659,319 in 2008 to 508,043 in 2009. This was

par tially mitigated by Public Key Infrastructure (PKI) projects

with Ministry of International Trade and Industry (MITI) and

Malaysian Industrial Development Authority (MIDA).

2009 saw Digicert embarked on MyGSet PKI project for

Kastam DiRaja Malaysia (KDRM) and the third generation

e-passport project for Immigration Department of Malaysia

besides completion of MIDA and MITI PKI projects.

Based on the Digital Signature Act (DSA) Performance

and Compliance Audit 2009, Digicert exceeded the key

performance indicators in 5 out of 6 areas for Local &

Technical Security Policy and all 3 PKI Security & Technical

Controls as stipulated by Malaysian Communications and

Multimedia Commission (MCMC), an achievement in

operational excellence.



Moving forwardThe company will look into fur ther developing and diversifying its products and services as required by its key customers.

The enhancements on application services for customers are expected to be the company’s main focus. Digicer t is confident

that 2010 will bear a better outlook for PKI as well as other IT security products and services amid fast growing electronic

commerce activities.


Group Products and Services

DATAPOS SERVICES

• DATA PROCESSING

• Database management • Software solutions

• HIGH SPEED DIGITAL LASER PRINTING

• High volume digital quality printing • Personalised (variable data printing) • Simplex highlight colour • Simplex and duplex B&W/colour • Continuous and cut sheet printing

• MAIL PROCESSING

• Enveloping, barcoding & account number verification (ANV) • Poly wrapping (plastic) • Page mailer/seal mailer • Address labeling, AR register, packing, docket posting and reporting

• TRANSPORTATION

• Pick-up & delivery

• VALUE ADDED SERVICES

• Data archiving & imaging • Return mail management

POSMEL PRODUCT AND SERVICES

• MAILING SOLUTIONS

• Standard Mail • Non-standard Mail • Parcel

• PREMIUM MAILING SOLUTIONS

• PosEkspress • PosEkspress International • PosDaftar • Bagasi Haji

• BUSINESS MAILING SOLUTIONS

• Pre-paid postage • Franking • Periodicals • PosDokumen • Corporate Mail Management • Business Reply Services • Bulk Mailing

• POST OFFICE SERVICES

• Private Letter Box • Locked Bag Service • Window Delivery Counter

• ADVERTISING SERVICES

• AdMail • Direct Mail



POSLAJU PRODUCT AND SERVICES

• NEXT DAY DELIVERY

Next working day delivery (D+1) within PosLaju coverage area.

• SAME DAY DELIVERY

Local Town & Cross Town Delivery for documents up to 1kg

• PUTRAJAYA EXPRESS

Same day delivery from/to Klang Valley to/from Putrajaya or Cyberjaya

• TIME CERTAIN SERVICE DOMESTIC (TCS)

Guaranteed delivery by 10 am on the next working day

• TIME CERTAIN SERVICE SINGAPORE

Guaranteed delivery by 10 am on the next working day

• TIME CERTAIN SERVICE TOKYO

Guaranteed delivery by 1 pm next working day

• POSPRIORITY EXPRESS

A high performance, premium delivery service to international destinations.

• INTERNATIONAL DELIVERY (EMS)

Deliver to over 200 countries worldwide

• OUR VALUES ADDED SERVICES

• Pick-Up service • Packaging Services • PosLaju Pack – Boxes, envelopes and tube • PosLaju Insurance

• TRACK & TRACE

• Via www.pos.com.my, www.poslaju.com.my and SMS service via mobile

ASIAXPRESS PRODUCT AND SERVICES

• INTERNATIONAL COURIER

• Economy Xpress • Priority Xpress • Diplomatic Xpress • Inbound Xpress

• OTHERS

• Special Handling Services • Customised Logistics Solutions • Corporate Mail Solutions

• DOMESTIC COURIER

• Standard Xpress • Same Day Xpress • Time Certain Xpress



POSNIAGA RETAIL SERVICES

• POSTAL & EXPRESS SERVICES

• PosLaju • PosDaftar • PosEkspres (Domestic and International)

• Parcel • AsiaXpress • Stamps

Group Products and Services

• Public Service Network - Driving License Renewal - Road Tax Renewal - SOCSO payment - Voters’ registration and change of address

• PAYMENT SERVICES

• Bills Payment - Electricity - Water - Telephone - Internet - Assessment - Quit Rent

• Bills Payment - JPA - MARA - PTPTN

• Telco Prepaid Cards/ Reload - Time Kontact - Digi - Maxis - Celcom

• Ticketing and Booking - AirAsia - Firefly

• Zakat (Tithe) Payment -14 states Pusat Zakat

• Stamp Duty

• POSONLINE

• Bills Payment - 116 Agencies

• PosOnline eShop - More than 500 products ranging from books, consumer products, health supplements, accessories, office stationaries etc

• Philately Online - Stamp album - Folder set - Stamp booklet - Special package

• Services Online - Pharmacy Home Delivery Service

• Personalised Stamps Online - Corporate - Individual

• Insurance - Pos Auto Plus - Pos Hospital Cash Income - Pos Maid Protector - Motor Insurance in partnership with panel insurers :

- Malaysian Motor Insurance Pool- Malaysian Assurance Alliance- Syarikat Takaful Malaysia- Kurnia Insurance

- Allianz General Insurance- ETIQA Takaful- ETIQA Insurance

• FINANCIAL SERVICES

• Remittance - Domestic Money Order - International Money Order - Express Money Order - Postal Order - Western Union

• Unit Trust - PNB Products (ASN, ASB, ASM, ASW, ASD, ASG, AS1M)

• Shared Banking Services - RHB Bank: Marketing of Financial Products (ASNB Loan, Personal Loan, Credit Card)


• PHILATELY

• Stamps - Special Issue - Commemorative - Definitive

• SODA account - New Account Registration

• Other Philatelic Products

- First Day Cover - Miniature Sheet - Presentation Pack

• Personalised Stamps - Corporate - Individual

- Account Top-Up

- Folder Set - Stamp Album - Stamp Booklet

• AUTHENTICATION & DIGITAL SIGNATURE SOLUTIONS

• DIGISIGN Server ID Enrich

• DIGISIGN ID Enhanced

• DIGISIGN ID Basic • DIGICERT Server based PKI (Roaming) • DIGICERT Token based PKI • DIGICERT Wireless PKI

• DIGISIGN File Manager • DIGICERT Forms Solution • DIGICERT PKI Toolkit - dc Tools - dc Signature - dc Tools Crypto

• iVEST Client • iVEST Server • iVEST File

• ENTERPRISE MANAGED IT SECURITY SERVICES (EMITSS)

• Risk Assessment • IT Security Assurance • Monitoring Services of critical assets • IT Security Assurance Testing • Managed Identity Management Service • Assurance Services for Data Protection

DIGICERT PRODUCT AND SERVICES

• DOCUMENT SECURITY SOLUTION

• SecureCODE • ID-Trace • Optical Watermark, Transactional Micro-print & Print Control


Collaboration withNSTP Gaza Fund

Service with a Smile Campaign

Commemorative Stamp in Honour of theSilver Jubilee Anniversary of His Royal Highness

the Sultan of Perak Darul Ridzuan

23 January 2009

3 February 2009

3 February 2009

Realising the responsibility to support the humanitarian efforts for the Palestinians, Pos Malaysia

had taken the initiative to place donation boxes in selected post offices countrywide to raise

fund for the Palestinians. At the launching ceremony, Pos Malaysia was represented by the

Group Managing Director/ Chief Executive Officer YBhg Dato’ Syed Faisal Albar, while NSTP

was represented by its Chief Executive Officer, YBhg Dato’ Anthony Firdauz Bujang.

The campaign was launched by YBhg Tan Sri Dato’ Seri (Dr.) Aseh Che Mat, Chairman of Pos

Malaysia in Ipoh, Perak. The campaign aims to promote good customer centric culture among

Pos Malaysia employees in servicing the customers.

Pos Malaysia issued a Commemorative Stamp and First Day Cover in honour of the Silver

Jubilee Anniversary of the reign of Duli Yang Maha Mulia Paduka Seri Sultan Azlan Muhibbuddin

Shah Ibni Almarhum Sultan Yussuf Izzuddin Shah Ghafarullahu-Lah, the Sultan of Perak Darul

Ridzuan. The Commemorative Stamp and First Day Cover was officially launched by His Royal

Highness the Sultan of Perak at Ipoh City Hall, Ipoh, Perak.

Launch of new PosLaju Centre, Ipoh4 February 2009

PosLaju centre in Ipoh officially moved to a new premise to ensure consistency of comfort

and convenience for customers, which are growing with time. The new centre was officiated

by YBhg Tan Sri Dato’ Seri (Dr.) Aseh Che Mat, Chairman of Pos Malaysia.

Corporate Events



To My Friend in Gaza

Signing Ceremony betweenPos Malaysia and TNT

PosLaju Receives the Award of Excellence for Courier Industry

12 March 2009

17 March 2009

31 March 2009

The project was a collaboration between Pos Malaysia, UNICEF and Wondermilk, to provide

the platform for Malaysian children in expressing their thoughts, hopes and support to the

Children of Gaza through writing. For this purpose, Pos Malaysia had created a special P.O. Box

to receive all the letters, cards and drawings from young well-wishers throughout Malaysia.

PosLaju, the courier arm of Pos Malaysia was appointed by TNT Express to extend TNT’s

delivery into rural areas in Malaysia. PosLaju will perform pick-up and delivery activities for

TNT in Kelantan, Terengganu, Pahang and across the sea in Sabah and Sarawak. The strategic

partnership is to provide products and services that offer speed and convenience for both

PosLaju and TNT’s customers. The partnership also reflects TNT’s trust in PosLaju’s capability

as the preferred courier service in Malaysia.

PosLaju had received the award from Brand Laureate and Readers’ Digest, and it was

presented by the former Prime Minister of Malaysia, YABhg. Tun Abdullah Hj Ahmad

Badawi.

Appointment of Telco & Postas PosLaju Certified Agent10 April 2009

Telco & Post Sdn Bhd had been appointed as PosLaju certified agent, where the company

will accept shipment for PosLaju at their premises. The signing of the agreement was also

witnessed by Malaysian ex-premier, YABhg. Tun Mahathir Mohamad.



Minggu Saham Amanah Malaysia

17th Annual General Meeting

MOU with China Post

19 - 27 April 2009

26 May 2009

3 June 2009

Pos Malaysia participated in the annual Minggu Saham Amanah Malaysia, organised by

Permodalan Nasional Berhad from 20 – 28 April 2009 in Johor. The exhibition involved the

Strategic Business Units of Pos Malaysia namely PosMel (mailing services), PosNiaga (retail &

counter services), PosLaju (courier services), PosLogistik (logistics services), and Asia Express

(international courier services).

The 17th Annual General Meeting for Pos Malaysia Berhad was held at the Legend Hotel Kuala

Lumpur on 26th May 2009.

Pos Malaysia and China Post signed the MOU in enhancing and improving the business

relationship between the two postal operators. The ceremony held in Beijing China was also

witnessed by the Prime Minister of Malaysia, YAB Dato’ Sri Mohd Najib Tun Hj Abdul Razak.

Pos Malaysia Hosts theSecond Quarter of K9 HR Heads Meeting17 June 2009

Pos Malaysia was given the honour to host the Second Quarter of K9 HR Circle meeting, is

an event held every quarter of the year. K9 HR Circle is a group of nine Human Resources

Heads for GLCs under the governance of Khazanah Nasional Berhad.

Corporate Events

Bowling Friendly Match betweenPos Malaysia and Malaysia Communications

and Multimedia Commission19 April 2009

Pos Malaysia participated in the friendly match that included children from Rumah Kebajikan

Anak Yatim/ Miskin Taman Baiduri, Dengkil. The event was held in Berjaya Times Square

and organized by the Sports and Recreational Club of Malaysian Communications and

Multimedia Commission.


SenamSeni 1Malaysia

PosLaju Received the Frost & Sullivan Awards

Hospital Bills Payment via Pos

27 June 2009

23 July 2009

29 July 2009

Pos Malaysia participated in the national event, SenamSeni 1Malaysia, which was organised

by the Ministry of Information, Communications and Culture at Dataran Merdeka. The

activity was organised to promote a healthy and active lifestyle, besides uniting Malaysia

through dance moves which combined elements from all major ethnics in Malaysia.

Once again, PosLaju received the Frost & Sullivan Award for Domestic Express Service

Provider of the Year 2009. The award was received by YBhg. Dato’ Syed Faisal Albar, Group

Managing Director/ Chief Executive Officer at the Award Presentation Ceremony, held at

the Intercontinental Hotel, Singapore.

Pos Malaysia and HUSM signed an agreement to enhance and improve the business payment

service at Pos Malaysia. Customers can now pay their hospital bills at Pos Malaysia’s counter

and also via Pos Malaysia’s online payment service, PosOnline. Hospital Universiti Sains Malaysia

Kubang Kerian is the first hospital to cooperate with Pos Malaysia to provide convenience to

the customers.

RHB Offers Maid Protection Plan via Post Office Counters

PINTAR Motivational Campfor Adopted Schools

30 July 2009

22 – 24 June 2009

Understanding the qualms of the employers of more than 230,000 foreign maids in Malaysia,

RHB Insurance now offers the Maid Protection Insurance Plan via post office counters. The

plan provides coverage for the maids, including death, permanent disability, vicarious liability,

and repatriation benefits, up to RM30,000.

As part of its Corporate Social Responsibility (CSR) initiatives, Pos Malaysia organised a

motivational camp for students in Standard 5 and Form 5 from Sekolah Kebangsaan Kuala Perai,

Bagan Dalam and Sekolah Menengah Kebangsaan Sungai Acheh, Nibong Tebal respectively,

under the PINTAR programme. The Camp was held at Dusun Minda Resort, Kuala Nerang,

Kedah.



ASEANPost RMC for IEMOand Terminal Dues Working Committee6 – 7 August 2009

Pos Malaysia FC won FAM Cup2 August 2009

Pos Malaysia Football Club which was formed in March 2008 had made its debut in the FA

Cup. Although the first strike was not an encouraging win, the team was later recommended

to compete in the FAM Cup. The move proved to be fruitful as Pos Malaysia FC was

crowned the 2009 Champion for the FAM Cup.

The ASEAN Terminal Dues Working Committee Meeting and ASEAN Regional Management

Committee (RMC) for IEMO (International Electronic Money Order) Meetings were

successfully held on 6 – 7 August 2009 in Concorde Hotel, Kuala Lumpur. The ASEAN

Terminal Dues Working Committee Meeting was participated by 15 members from all

ASEANPOST countries except Brunei Darussalam and Myanmar.

Meanwhile, the ASEAN RMC for IEMO Meeting was attended by 13 members from 6

ASEANPOST countries and 3 coordinators namely; Cambodia, Indonesia, Lao PDR, Malaysia,

Philippines, Vietnam, La Poste and Universal Postal Union (UPU).

Corporate Events

Appointment of Contractor to Develop the New National Mail and Parcel Hub (NMPH)31 July 2009

Pos Malaysia continues its transformation efforts with the development of the new National

Mail and Parcel Hub in Shah Alam, that will soon replace the Mail Centres in Bukit Raja,

Bangi and Kuala Lumpur. Global Technological Support Sdn Bhd was appointed as the main

contractor for the project to ensure smooth development of the NMPH.


Pos Malaysia tied-up with TIAM

PosLaju won MSC APICTA Awards 2009

18 September 2009

8 October 2009

A Memorandum of Understanding was signed between Pos Malaysia and Taipei Investors’

Association in Malaysia (TIAM) for Pos Malaysia to provide its services to all members

of TIAM. TIAM members will be promoting Pos Malaysia services and to appoint PosLaju

as their preferred courier service. At the ceremony, Pos Malaysia was represented by its

Chairman, YBhg Tan Sri Dato’ Seri (Dr.) Aseh Che Mat, while TIAM was represented by its

National President, YBhg Datuk Dr Ting Chung Cheng.

PosLaju’s Pos Integrated Track & Trace Information System (PITTIS) applications, had won the

MSC-APICTA Award 2009, in the Best E-Logistic category. The award was presented by the

Minister of Science, Technology and Innovation, YB Datuk Dr Maximus Ongkili.

Buka Puasa with the Orphansand Distribution of Bubur Lambuk10 September 2009

Pos Malaysia continued the tradition of giving and sharing to the unfortunates. Seventy six

orphans, mostly children of Pos Malaysia’s employees that had passed away, and also children

from Rumah Anak Yatim Darul Taqwa and Nur Hikmah were feted at a ceremony held at

Dewan Sri Pos, Pos Malaysia Headquarters. The Bubur Lambuk, a favourite dish in Ramadhan,

was also distributed to all employees in Pos Malaysia Headquarters.



Signing Ceremony betweenPos Malaysia and Prisons Department2 November 2009

A strategic partnership was formed between Pos Malaysia and the Prisons Department

of Malaysia, to provide postal services in prison complexes nationwide. With this

collaboration, Pos Malaysia via its strategic business unit, PosNiaga will now be operating in

the complexes, and PosLaju on the other hand will become the preferred courier service

for the Prisons Department.

Corporate Events

More Banks became PosOnline Partners

Commemorative Stamp on the Coronation of the Yang Di-Pertuan Besar Negeri Sembilan

20 October 2009

24 October 2009

PosOnline, Pos Malaysia’s online payment service has appointed AFFIN Bank, Al-Rajhi

Bank and EON Bank as the latest partners for its payment channel. Pos Malaysia was

represented by its Group Chief Strategy & Planning, Encik Jezilee Mohamad Ramli.

Pos Malaysia issued a commemorative stamp in conjunction with the Coronation of the Yang

Di-Pertuan Besar of Negeri Sembilan, DYMM Tuanku Muhriz Ibni Almarhum Tuanku Munawir.

The Commemorative Stamp and First Day Cover was officially launched by His Royal Highness

the Yang Di-Pertuan Besar of Negeri Sembilan at Istana Lama Seri Menanti, Negeri Sembilan.

World Postal Day9 October 2009

Just like any other postal organisations around the world, Pos Malaysia had also celebrated

this year’s World Postal Day. This year, the national level celebration was held at Shah Alam

General Post Office in Selangor. It was launched by Encik Jezilee Mohamad Ramli, Group Chief

Strategy & Planning of Pos Malaysia.


Singapore Post visited Pos Malaysia to fur ther explore on business opportunities partners

in the postal industry. During the visit, a mutual agreement to embark on a collaboration

for Postal Transshipment was realised between the two postal operators.

Official Visit of SingPost to Pos Malaysia10 December 2009

Launching of Letter for Prime Minister Competition29 December 2009

A “Letter for Prime Minister Competition” for Malaysian students to voice out their

opinions and suggestions towards achieving the 1Malaysia vision. The competition, which

is opened to all Malaysian students aged 7 – 17 was co-organised by the Ministry of

Information, Communications and Culture (MICC), and the Ministry of Education (MOE),

as well as RTM as the media partner. It was launched by YAB Prime Minister, Dato’ Sri

Mohd Najib Tun Haji Abdul Razak during the Christmas Open House in Kota Kinabalu.

Pos Malaysia Annual Report 200948 Pos Malaysia Annual Report 200948



Pos Malaysia In the News



OUR PROFILE


BOARD OF DIRECTORS BOARD COMMITTEES


Non-Independent Non-Executive Chairman

Dato’ Syed Faisal Albar bin Syed A.R Albar

Group Managing Director/Chief Executive Officer

Dato’ Ibrahim Mahaludin bin Puteh

Independent Non-Executive Director

Datuk Low Seng Kuan

Senior Independent Non-Executive Director

Dato’ Krishnan a/l Chinapan


Puan Sri Datuk Nazariah binti Mohd Khalid


Tan Sri Dato’ Ir Muhammad Radzi bin Haji Mansor

Non-Independent Non-Executive Director(Appointed w.e.f 21 October 2009)

Wee Hoe Soon @ Gooi Hoe Soon


Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin

Non-Independent Non-Executive Director

Abdul Hamid bin Sh Mohamed


Eshah binti Meor Suleiman


Haizan bin Mohd Khir Johari

Non-Independent Non-Executive Director(Appointed w.e.f 23 February 2010)

Audit Committee

Datuk Low Seng Kuan

Chairman/Senior Independent Non-Executive Director

Wee Hoe Soon @ Gooi Hoe Soon




Abdul Hamid bin Sh Mohamed



Independent Non-Executive Director(Appointed w.e.f 12 March 2010)


Chairperson/Independent Non-Executive Director



Datuk Low Seng Kuan

Senior Independent Non-Executive Director







Board Nomination andRemuneration Committee

Corporate Information




Chairperson/Non-Independent Non-Executive Director







Sabrina Albakri binti Abu Bakar (LS 8508)

Tender Board Committee

Level 33, Menara Dayabumi

Jalan Sultan Hishamuddin

50050 Kuala Lumpur

Tel: 603-22672267

Fax: 603-22672266

Registered Office

Tricor Investor Services Sdn Bhd

(formerly known as Tenaga Koperat Sdn Bhd)

Level 17, The Gardens North Tower

Mid Valley City, Lingkaran Syed Putra

59200 Kuala Lumpur

Tel: 603-22643883

Fax: 603-22821886

Share Registrar

KPMG

Chartered Accountants

Auditors

Malayan Banking Berhad

CIMB Bank Berhad

HSBC Bank Malaysia Berhad

Bankers

Main Market of Bursa Malaysia Securities Berhad

Stock Exchange Listing

COMPANY SECRETARY



SUBSIDIARIES

ASSOCIATES

No.

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

13.

14.

15.

16.

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No.1.

2.

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5.

Name of CompanyCEN Sdn Bhd

Pospay Exchange Sdn Bhd

Elpos Print Sdn Bhd

CEN Worldwide Sdn BhdCEN Technology Sdn Bhd

ShareholderPos Malaysia BerhadTransmile Group Berhad

Pos Malaysia BerhadRoyal Mint ExchangeEconlink Sdn BhdPos Malaysia Berhad

CEN Sdn Bhd

CEN Sdn BhdChay Wai Lan

% of Shareholdings42.5%57.5%

50%50%60%40%

100%

50%50%

Name of Company

Prestige Future Sdn Bhd

PSH Venture Capital Sdn Bhd

PSH Merchandise Sdn Bhd

PSH Express Sdn Bhd

PSH Capital Partners Sdn Bhd

PSH Allied Berhad

PSH Management Sdn Bhd

PSH Properties Sdn Bhd

Effivation Sdn Bhd

Real Riviera Sdn Bhd

Datapos (M) Sdn Bhd

Pos Takaful Agency Sdn Bhd

Virtual Pos Sdn Bhd

Pos Logistics-Fulserve Sdn Bhd

Philately Pos Malaysia Sdn Bhd

PMB Properties Sdn Bhd

Digicert Sdn Bhd

Pos Malaysia & Services Holdings Berhad

Poslaju (M) Sdn Bhd

PSH Investment Holding (BVI) Ltd

Shareholder

PSH Capital Partners Sdn Bhd

Pos Malaysia Berhad

Pos Malaysia Berhad

PSH Venture Capital Sdn Bhd

Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia Berhad



Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia Berhad

Pos Malaysia & Services Holdings Berhad

% of Shareholdings

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

100%

Group Structure


BOARD OF DIRECTORS


Board of Directors

Tan Sri Dato’ Seri (Dr.) Aseh, 58, a Malaysian, was appointed to the Board on 15 July 2008 as Non-Independent Non-Executive Chairman. Tan Sri Aseh obtained his Bachelor of Economics (Honours) degree from the University of Malaya in 1974 and obtained his Masters in Public Administration degree from the University of Southern California, USA in 1984. In year 2007, he received his PhD (Honorary) in International Relations from the Limkokwing University of Creative Technology, Cyberjaya.

Upon his graduation in 1974, Tan Sri Aseh joined the Ministry of Finance as Assistant Secretary. Prior to his retirement in October 2007 as Secretary General of the Ministry of Home Affairs, he held various positions in the civil service, ranging from Principal Assistant Secretary in the Education Services Commission, serving Sarawak and Sabah for 7 years from 1977 to 1981, and other various positions in the Ministry of Home Affairs before being appointed Deputy Director-General of Immigration Malaysia and thereafter, Director-General of Immigration Malaysia.

Tan Sri Aseh is active in community services and is currently the Chairman of RELA Cooperative, Chairman of FAM Monitoring Committee, President of Rifle Association Malaysia, President of Tiara Golf & Country Club, Melaka, Advisor of PAPITA (Singer Association of Malaysia) and Chairman of Limkokwing University of Creative Technology since June 2009. Tan Sri Aseh was also active in the Administrative and Diplomatic Service (ADS) and was its longest serving President from 2001 to 2008. Prior to his appointment as President, he was an EXCO member and thereafter made Vice President of the ADS.

Tan Sri Aseh does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.

Tan Sri Aseh attended seven (7) out of eight (8) Board meetings held during the financial year under review.

Tan Sri Dato’ Seri (Dr.) Aseh bin Haji Che Mat Non-Independent Non-Executive Chairman

Particulars of other directorships in public companies:* MWE Holdings Berhad (Chairman)* Stemlife Berhad (Chairman)* Lion Diversified Holdings Berhad



Dato’ Syed Faisal Albar, 44, a Malaysian, was appointed to the Board on 1 November 2008 as the Group Managing Director/Chief Executive Officer of the Company.

Dato’ Syed Faisal is a member of the Malaysian Institute of Cer tified Public Accountants (MICPA) and a member of the American Institute of Cer tified Public Accountants (AICPA).

He star ted his career with Pricewaterhouse (now PricewaterhouseCoopers) Kuala Lumpur in 1991. He served with Pricewaterhouse, San Francisco, California, USA in 1995 before returning to Kuala Lumpur in 1997. Dato’ Syed Faisal joined The New Straits Times Press (Malaysia) Berhad (NSTP) in May 2000 as Financial Controller and was appointed Chief Executive Officer/ Executive Director of NSTP in 2003; a position which he held until October 2008.

Dato’ Syed Faisal does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.

Dato’ Syed Faisal attended all eight (8) Board meetings held during the financial year under review.

Dato’ Syed Faisal Albar bin Syed A.R AlbarGroup Managing Director/ Chief Executive Officer



Datuk Low Seng Kuan, 63, a Malaysian, was appointed Director of the Company on 1 July 1992. He was re-designated as Independent Non-Executive Director and simultaneously appointed Senior Independent Director with effect from 21 August 2007. Datuk Low is the Chairman of the Audit Committee and a member of the Board Nomination and Remuneration Committee.

Datuk Low is a Char tered Accountant by profession and is a member of the Malaysian Institute of Accountants and has more than 30 years of experience in the manufacturing industry. He graduated from the Footscray Institute of Technology (Victoria University) in Business Studies (Accountancy) and the Royal Melbourne Institute of Technology (RMIT) in Industrial Accountancy.

Datuk Low was the Managing Director of Malaysian Sheet Glass Sdn Bhd until 31 March 2010. He also serves on the Board of a number of private and government-linked corporations. He is the former President of the Federation of Malaysian Manufacturers (FMM) and is currently the Vice-President of FMM. Datuk Low had served as a Board member of the Malaysian Industrial Development Authority (MIDA) and Malaysian Institute of Economic Research (MIER). He is currently the President of Transparency International Malaysia.

Datuk Low does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.

Datuk Low attended seven (7) out of eight (8) Board meetings held during the financial year under review.

Par ticulars of other directorships in public companies:* Sunway Holdings Incorporated Berhad* Logos Institute Berhad* Be in Health Berhad

Datuk Low Seng KuanSenior Independent Non-Executive Director

Board of Directors


Dato’ Krishnan a/l Chinapan, 63, a Malaysian, was appointed Director of the Company on 1 July 1992. He was re-designated as Independent Non-Executive Director of the Company with effect from 21 August 2007. Dato’ Krishnan is a member of the Board Nomination and Remuneration Committee and the Tender Board Committee.

Dato’ Krishnan is currently a Director of National Land Finance Co-Operative Society Limited, Nalfin Realities Sdn Bhd and Apollo Medical Centre TTDI. Dato’ Krishnan was a Senator in the Parliament from 1986 to 1992.

Dato’ Krishnan does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.

Dato’ Krishnan attended seven (7) out of eight (8) Board meetings held during the financial year under review.

Dato’ Krishnan a/l ChinapanIndependent Non-Executive Director



Board of Directors

Puan Sri Datuk Nazariah binti Mohd Khalid, 60, a Malaysian, was appointed to the Board on 13 August 2007 as an Independent Non-Executive Director. She is the Chairperson of the Board Nomination and Remuneration Committee and a member of the Tender Board Committee. On 12 March 2010, Puan Sri Datuk Nazariah was appointed member of the Audit Committee.

Puan Sri Datuk Nazariah graduated with a Bachelor of Arts (Honours) degree from the University of Tasmania, Australia and holds a Master of Business Administration degree from Michigan State University, USA. She joined the Malaysian Civil Service in 1972 and served in various capacities prior to her last post as the Director General of the Malaysian Administrative Modernisation and Management Planning Unit (MAMPU) in the Prime Minister’s Department.

Puan Sri Datuk Nazariah does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. She has not been convicted of any offence within the past 10 years.

Puan Sri Datuk Nazariah attended all eight (8) Board meetings held during the financial year under review.

Puan Sri Datuk Nazariah binti Mohd KhalidIndependent Non-Executive Director


Dato’ Ibrahim Mahaludin bin Puteh, 58, a Malaysian, was appointed to the Board on 22 August 2007 as a Non-Independent Non-Executive Director. On 25 February 2009, he was re-designated as Independent Non-Executive Director. Dato’ Ibrahim is a member of the Board Nomination and Remuneration Committee and Tender Board Committee.

Dato’ Ibrahim holds a Bachelor of Ar ts (Honours) degree from the University of Malaya and a Master of Business Administration degree from the Manchester Business School, University of Manchester, United Kingdom.

Dato’ Ibrahim is currently the Chairman of Indah Water Konsor tium Sdn Bhd, a position which he held since 1 September 2009 and Chairman of Computer Forms (Malaysia) Berhad since 1 December 2008. He is the former Chairman of Syarikat Prasarana Negara Berhad. Prior to that, Dato’ Ibrahim had served in various divisions at the Ministry of Finance since 1974 including as Senior Adviser to the Executive Director for South East Asia at the World Bank Group in Washington D.C. His last post prior to his retirement from the Ministry of Finance in 2008 was the Deputy Secretary General (Policy) in the Ministry of Finance.

Dato’ Ibrahim does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.

Dato’ Ibrahim attended all eight (8) Board meetings held during the financial year under review.

Par ticulars of other directorships in public companies:*Computer Forms (Malaysia) Berhad (Chairman)

Dato’ Ibrahim Mahaludin bin PutehIndependent Non-Executive Director



Mr Wee Hoe Soon @ Gooi Hoe Soon, 49, a Malaysian, was appointed to the Board on 13 August 2007 as an Independent Non-Executive Director. He is a member of the Audit Committee.

Mr Gooi is a member of the Malaysian Institute of Cer tified Public Accountants and the Malaysian Institute of Accountants. He has more than 25 years of experience in the fields of accounting and corporate finance and was Finance Director of several private and public listed companies.

He had been instrumental in the successful implementation of several corporate exercises, which included mergers and acquisitions and corporate debt restructuring exercises under taken by public listed companies.

In 1999, Mr Gooi was appointed to the Board of Avenue Capital Resources Berhad as a Non-Executive Director and subsequently appointed as Group Managing Director in 2001 and Deputy Chairman in 2004; holding this last post until 2006. He was also the CEO/Executive Director (Dealing) of Avenue Securities Sdn Bhd.

Mr Gooi does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.

Mr Gooi attended all eight (8) Board meetings held during the financial year under review.

Par ticulars of other directorships in public companies:* Hup Seng Industries Berhad* Winsun Technologies Berhad* Kobay Technology Berhad* EON Bank Berhad* MIMB Investment Bank Bhd* EON Capital Bhd

Wee Hoe Soon @ Gooi Hoe SoonIndependent Non-Executive Director

Board of Directors


Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin, 51, a Malaysian, was appointed to the Board on 13 August 2007 as a Non-Independent Non-Executive Director. Tunku Dato’ Mahmood Fawzy is a member of the Audit Committee and Board Nomination and Remuneration Committee.

Tunku Dato’ Mahmood Fawzy holds a Bachelor of Ar ts (Honours) degree in Business Studies from the Polytechnic of Central London, a Master of Business Administration degree from the Warwick University and a Diploma in Marketing from the Char tered Institute of Marketing. He is also a member of the Malaysian Institute of Management. He has worked in the United Kingdom, New Zealand, South Africa and Malaysia in a variety of senior management positions that span 22 years.

Tunku Dato’ Mahmood Fawzy does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.

Tunku Dato’ Mahmood Fawzy attended seven (7) out of eight (8) Board meetings held during the financial year under review.

Par ticulars of other directorships in public companies:* Telekom Malaysia Berhad

Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin Non-Independent Non-Executive Director



Board of Directors

Encik Abdul Hamid bin Sh. Mohamed, 44, a Malaysian, was appointed to the Board on 13 August 2007 as an Independent Non-Executive Director. He is a member of the Audit Committee.

Encik Abdul Hamid is currently the Executive Director of Symphony House Berhad. Immediately preceding his appointment at Symphony, he was the Chief Financial Officer of the Kuala Lumpur Stock Exchange (KLSE), now known as Bursa Malaysia Berhad. He joined KLSE in 1998 as Senior Vice President, in charge of the Strategic Planning & International Affairs Division and was promoted to Deputy President (Strategy and Development) in 2002. He was re-designated to Chief Financial Officer in 2003. During his five years with the KLSE Group, he held diversed roles and had experience in strategy, corporate finance, business transformation, finance and administration, treasury, external affairs and public relations. He led KLSE’s acquisitions of KLOFFE and COMMEX and their merger to form MDEX, and the acquisition of MESDAQ. He also led KLSE’s demutualisation exercise.

Encik Abdul Hamid star ted his career in the accounting firm Messrs Lim Ali & Co. / Ar thur Young, before moving on to merchant banking with Bumiputra Merchant Bankers Berhad. He later moved on to the Amanah Capital Malaysia Berhad Group, an investment banking and finance group, where he led the corporate planning and finance functions until 1998 when he joined the KLSE.

Encik Abdul Hamid does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.

Encik Abdul Hamid attended all eight (8) Board meetings held during the financial year under review.

Particulars of other directorships in public companies:* Symphony House Berhad* Hartalega Holdings Berhad* SILK Holdings Berhad (formerly known as Sunway Infrastructure Bhd)* MMC Corporation Berhad* Scomi Engineering Berhad

Abdul Hamid bin Sh Mohamed Independent Non-Executive Director


Puan Eshah binti Meor Suleiman, 55, a Malaysian, was appointed to the Board on 25 February 2009 as Non-Independent Non-Executive Director. She is the Chairperson of the Tender Board Committee and member of the Board Nomination and Remuneration Committee.

Puan Eshah obtained her Bachelor of Economics (Honours) degree from the University of Malaya in 1980 and obtained her Master in Business Administration (Finance) from the Oklahoma City University, U.S.A in 1994.

She star ted her career in 1981 as Assistant Director (Macro Economic Section) Economic Planning Unit of the Prime Minister’s Depar tment before serving as Assistant Secretary at the Government Procurement Division, Ministry of Finance in middle of 1991. Puan Eshah later held various positions in the Government Ministries. In September 2006, she was promoted to her current position as Under Secretary of Investment, Minister of Finance (Incorporated) and Privatisation Division of the Ministry of Finance Malaysia.

Puan Eshah does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. She has not been convicted of any offence within the past 10 years.

Puan Eshah attended six (6) out of eight (8) Board meetings held during the financial year under review.

Par ticulars of other directorships in public companies:* Global Maritime Ventures Berhad*Telekom Malaysia Berhad (Alternate Director) Eshah binti Meor Suleiman




Board of Directors

Tan Sri Dato’ Ir. Muhammad Radzi bin Haji Mansor, 68, a Malaysian, was appointed to the Board on 21 October 2009 as a Non-Independent Non-Executive Director.

Tan Sri Radzi graduated with a Diploma in Electrical Engineering from Faraday House Engineering College, London in 1962, and a Master in Science (Technological Economics) from the University of Stirling, Scotland in 1975. A Char tered Professional Engineer registered with the Board of Engineers Malaysia and Engineering Council United Kingdom, he is a corporate member of the Institution of Engineers Malaysia, the Institution of Engineering and Technology United Kingdom and the Char tered Management Institute United Kingdom.

Tan Sri Radzi was Chairman and Director of Telekom Malaysia Berhad (TM) from 12 July 1999 to 30 July 2009. Prior to that, he had served in various engineering and management capacities in the former Jabatan Telekom Malaysia (JTM) over a period of 22 years, including a three-year secondment as Technical Adviser to the Ministry of Energy, Telecommunications and Post. Tan Sri Radzi retired as Director-General of Telecommunications upon JTM’s corporatization on 1 January 1987, and was subsequently appointed Director of Operations at TM. He served as Director of Marketing and Customer Services from 1989 to 1995 and later as Director of Regulatory Management and External Affairs before retiring in July 1996. From 1997 to 1999, Tan Sri Radzi was retained as a Consultant/Advisor on multimedia flagship application projects for the Multimedia Development Corporation Sdn Bhd and currently, he is a member of its Board of Directors.

Tan Sri Radzi does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.

Tan Sri Radzi attended all three (3) Board meetings held subsequent to his appointment as Non-Independent Non-Executive Director of the Company during the financial year under review.

Par ticulars of other directorships in public companies:* Kumpulan Fima Berhad (Chairman)

Tan Sri Dato’ Ir. Muhammad Radzi bin Haji Mansor Non-Independent Non-Executive Director


Haizan bin Mohd Khir JohariNon-Independent Non-Executive Director

Encik Haizan bin Mohd Khir Johari, 39, a Malaysian, was appointed to the Board on 23 February 2010 as a Non-Independent Non-Executive Director.

Encik Haizan graduated with a Bachelor of Business Administration majoring in Finance from the University of Hawaii at Manoa in 1992. He star ted in the investments-related field as a trainee at the Por tfolio Management division of Arab Malaysian Merchant Bank in December 1992. Subsequently, he became an equity research analyst at several domestic and international financial institutions including Schroders, Phileo Allied and Credit Suisse First Boston from 1994 to 2003, with coverage in sectors such as telecommunications, automotive, oil and gas, and other primary industries.

In November 2003, Encik Haizan was appointed Special Officer to the Fifth Prime Minister of Malaysia and served as par t of the Policy Unit of the Prime Minister’s Office. He joined Khazanah Nasional Berhad in September 2006, and is currently Senior Vice President, Investments.

Encik Haizan does not have any family relationship with any director and/or substantial shareholder of the Company or any conflict of interest with the Company. He has not been convicted of any offence within the past 10 years.


Dato’ Syed Faisal AlbarGroupManagingDirector/ChiefExecutiveOfficer

Jezilee Mohamad RamliStrategy & Planning

Idham IsmailCEO’sOffice

Mohd Lutfi Mat LazimGroup Finance

Mohd Rosdeen HassanInformation, Communication & Technology

Pat WahidGroup Marketing

Leadership Team



Haji Nadza AbdulPosLaju

Bahaman KamaruzzamanPosMel

Sabrina Albakri Abu BakarLegal and Secretarial

Dato’ Mearia HamzahPosNiaga

Dato’ Mohd Derus HarunTransport Management

Dato’ Rohaiza HashimCorporate Communications



Leadership Team

Haji Ithnin TalibSecurity & Investigation

Dato’ Noor Azli OthmanDigicert (M) Sdn Bhd

Aziz ManasInternal Audit

Raja Nur Izah Raja JafaarPSH Express Sdn Bhd

Mohd Ripin Kusnan Datapos (M) Sdn Bhd

Chum Choy HanInternational & Regulatory Affairs

Salamah SamsudinCall Center

Mohd Rizal HamzahGroup Procurement

Dato’ Shahri JikunGroup Property & Corporate Insurance

Nuranisah Mohd AnisCorporate Risk Management

Balqais YusoffCorporate Planning & Strategic Business


OUR COMMITMENTS


Corporate Social Responsibility Statement

Corporate Social ResponsibilityPos Malaysia aspires to become a socially responsible

corporate citizen. Although 2009 was a challenging year due

to sluggish economic condition, Pos Malaysia believes in giving

back to the community. Pos Malaysia constantly strives to be

a caring corporate citizen by supporting nation building and

community services.

Balance between commercial objectives and being socially responsiblePos Malaysia is not only seen as a postal operator in Malaysia.

We enable efficient flow of goods and services, information

and funds. We value the trust that the people have in us,

although we have to subsidize the cost of our services.

Our existence benefits more than 15,700 employees, 1,400

vendors and other stakeholders. We endeavor to become a

viable entity and give positive impact to our stakeholders.

Borderless humanitarian contribution2009 had witnessed the struggle of the Palestinians when

their homes were destroyed and basic supplies were being

thwarted by the Israel’s regime. A call for humanitarian act

was answered by Pos Malaysia, in support of the NSTP Gaza

Fund. Donation boxes were placed at selected post offices

to raise fund. The campaign managed to collect RM253,191

for Gaza Fund.

Pos Malaysia, in collaboration with UNICEF had created ‘To

My Friends In Gaza’ project, where thousands of letters,

cards, and drawings were received from young Malaysians,

dedicated especially to the children of Gaza. It was our

responsibility to reach out and convey messages of hopes,

prayers and well-wishes of Malaysian children to the

Palestinian children.

In addition, Pos Malaysia continued the tradition of giving and

sharing to the unfortunates, in particular orphans and old folks

through ‘Buka Puasa’ events and celebrating Hari Raya.

Incessantly Nurturing Excellence in EducationIn 2009, Pos Malaysia continued to support its adopted

schools under the PINTAR Programme. Students from

Sekolah Menengah Kebangsaan Sungai Acheh, Nibong Tebal

and Sekolah Kebangsaan Kuala Perai, Bagan Dalam, Pulau

Pinang were sent to motivational camps to guide them in

their preparations for SPM and UPSR.



Pos Malaysia Berhad (“Pos Malaysia” or “the Company”),

a Government-linked Company (“GLC”), its Board of

Directors (“Board”) and Management remain committed

to upholding and continuously improving good corporate

governance practices throughout the Pos Malaysia Group

of Companies (“Group”) for the protection of and greater

creation of shareholders’ and other stakeholders’ value and for

maintaining integrity, trust and confidence in the Company.

The foundation for good governance lies in having an effective

Board in place. The Board realises that to be effective, the

Board and its members must progress to be continuously

performing rather than just conforming. The Board subscribes

to the belief that improving the effectiveness of the Board to

best practice standards is a continuous journey.

As a GLC in Malaysia, Pos Malaysia has, apart from abiding by

the principles and best practices as set out in the Malaysian

Code on Corporate Governance (“the Code”) and the

Corporate Governance Guide issued by Bursa Malaysia

Berhad, subscribed to most of the guidelines introduced by

the Putrajaya Committee on GLC High Performance (“PCG”)

in enhancing Board Effectiveness. These guidelines as codified

in the Green Book reinforce the recommendations contained

in the Code.

Board Effectiveness Assessment (“BEA”)During the financial year ended 31 December 2009, a set

of findings following the conduct of the Board Effectiveness

Assessment for year 2008 (“2008 BEA”) had been analysed

and discussed. Proposed action plans were thereafter

developed by Management to address gaps that had been

identified to improve the Board’s effectiveness and efficiency.

The Board Nomination and Remuneration Committee

(“BNRC”) is tasked with conducting assessments of the

Board effectiveness and once the action plans have been

completed by Management, they will be tabled to the Board

for endorsement and implementation. At the end of year

2010, a follow-up assessment on the action plans implemented

will be carried out. This is in line with the recommendation

under the Green Book.

Apart from the initiative to enhance the Board’s effectiveness

in the financial year under review, the Board received updates

on a quarterly basis covering the improvement initiatives

undertaken by the Company pursuant to other guidelines

and best practices launched by the PCG under the GLC

Transformation Programme.

The Board is now pleased to report to the shareholders in

greater detail on the manner by which the Group has applied

the principles of the Code and the extent of compliance with

the best practice provisions of the Code.



A. Board of DirectorsPrincipal Responsibilities of the BoardThe Board, which is appointed by the shareholders, is entrusted

with dealing and controlling the Group and overseeing the

business of the Group, which includes optimising long-term

financial returns and shareholders’ wealth creation.

As a fundamental part of discharging the Board’s responsibilities

in order to protect and enhance stakeholders’ value and

financial performance of the Group, the Board of Directors

continuously acts to improve and refine management

practices and systems and ensures that the Group has strong

internal controls and processes in place to implement the

principles and concepts of good governance.

The duties, responsibilities, powers and functions of the

Board are governed by the Articles of Association of the

Company (“Company Articles”), the Companies Act 1965

and Companies (Amendment) Act 2007 (collectively the

“Companies Act”), the Main Market Listing Requirements

of Bursa Malaysia Securities Berhad and other relevant laws,

rules, and regulatory guidelines that are in force. The Board is

also governed by its Pos Malaysia Board Policy Manual, which

assists Board members to better appreciate their roles and

responsibilities. With an appropriate understanding of its role,

the Board is better equipped to meet its responsibilities in

ensuring that the long-term objectives of the Group are met.

Under the Pos Malaysia Board Policy Manual, the Board

directs and oversees the management of the business and

affairs of the Group including the following:-

Ensurei. that the Group’s objectives are clearly established

and that a strategic plan is in place to achieve those

objectives;

Establishii. policies for strengthening the performance

of the Group including ensuring that the Management

is proactively seeking to build the business through

innovation, initiative, technology, new products and the

development of business capital;

Adoptiii. performance measures to monitor implementation

and performance of the objectives, strategies, action

plans, and policies;

Overseeiv. the conduct of the Group’s business to evaluate

whether the business is being properly managed;

Ensurev. that the Group has appropriate business and

enterprise-wide risk management processes, including an

adequate control environment based on internal control

systems, management information systems and systems for

compliance with applicable laws, rules and regulations;

Appointvi. Board Committees to address specific issues,

consider recommendations of the Board Committees

and discuss problems and reservations arising from the

Committees’ deliberations;



Ensure that the statutory accounts of the Group are vii.

fairly stated and conform with the relevant regulations

including acceptable accounting policies;

Ensureviii. that there is in place an appropriate succession

planning mechanism for members of the Board and for

Senior Management positions;

Ensureix. that the Group adheres to high standards of

ethics and corporate behaviour including transparency

in the conduct of business;

Ensurex. that there is in place an appropriate public

relations and communications programme, as well as an

investor relations programme; and

Ensurexi. there is a Schedule of Matters reserved for

collective decision of the Board.

The Schedule of Matters reserved for collective decision

of the Board is enshrined in the Company’s Discretionary

Authority Limits document, which comprises the overall

internal authority limits applicable to the Company and its

principal officers.

Board Balance andComposition of the BoardThe Company Articles stipulate that the Board shall not

comprise less than two (2) nor more than twelve (12)

members. The Board currently consists of twelve (12)

members, comprising a Non-Independent Non-Executive

Chairman, a Group Managing Director/Chief Executive

Officer (“GMD/CEO”), four (4) Non-Independent Non-

Executive Directors and six (6) Independent Non-Executive

Directors. With half of the Board members comprising

Independent Directors, the Company has exceeded the

compliance level set under the Bursa Securities Listing

Requirements, which requires one-third of the Board to be

Independent Directors.

The Board is of the opinion that the current size and

composition of the Board is well balanced and the Board is

able to properly discharge its responsibilities in an effective

manner. The Board members’ varied skills and breadth

of experience are relevant and important for effective

management of the Group’s business. Details of the Board

members’ skills and experience are outlined in the Profile of

Directors contained in this Annual Report.

There is a clear separation of responsibilities between the

Chairman and the GMD/CEO and a balance of power is

maintained in the Company so that no one individual has

unfettered powers of decision.

The Chairman of the Board is responsible for representing

the Board to shareholders. The Chairman is responsible for

ensuring integrity and effectiveness of the governance process

of the Board and will consult the Board promptly over any

matter that gives him cause for concern. The Chairman will act

as facilitator at meetings of the Board to ensure that no Board

member, whether executive or non-executive, dominates

the discussion. The Chairman also ensures that appropriate

discussions take place and that relevant opinions among

Board members are forthcoming. The Chairman further

ensures that discussions result in logical and understandable

outcomes, which will lead to appropriate and considered

decisions by the Board.



The GMD/CEO manages the overall business and oversees

the day-to-day operations of the Group and is accountable

to the Board for the overall organisation, management and

staffing of the Group and for its procedures in financial

and operational matters, including conduct and discipline.

The authority limits of the GMD/CEO are enshrined in the

Company’s Discretionary Authority Limits duly approved by

the Board.

The six (6) Independent Non-Executive Directors of the

Company are independent from Management and are able

to exercise independent judgement and provide positive

participation in all the Board’s deliberations. They also play

a pivotal role in the provision of unbiased and independent

views, advice and judgement as well as safeguard the

interests of other parties such as minority shareholders and

other stakeholders. Khazanah Nasional Berhad, the largest

shareholder of the Company has nominated Tunku Dato’

Mahmood Fawzy bin Tunku Muhiyiddin and Encik Haizan

bin Mohd Khir Johari as its nominees on the Board while

Puan Eshah binti Meor Suleiman and YBhg Tan Sri Dato’

Ir Muhammad Radzi bin Haji Mansor are the appointed

representatives of the Minister of Finance (Incorporated).

Datuk Low Seng Kuan is the Company’s Senior Independent

Non-Executive Director to whom concerns may be conveyed

by shareholders and/or members of the public. Datuk Low

has been a Director of the Company since 1 July 1992

and he was re-designated as the Company’s Independent

Director and simultaneously appointed the Company’s

Senior Independent Director with effect from 21 August

2007 pursuant to the restructuring of the Pos Malaysia

Group. Datuk Low is also the Company’s Audit Committee

Chairman. The Senior Independent Non-Executive Director

represents the interest of minority shareholders and the

general public by exercising independent judgement as well

as promoting good governance practices within the Company

and the Board.



Board Meetings andSupply of Information to the BoardDuring the financial year ended 31 December 2009, eight (8) Board meetings were held and the attendance of the Board members

was as follows:-

Directors No. of meetings atended Percentage

Tan Sri Dato’ Seri (Dr.) Aseh bin Haji Che Mat 7 out of 8 88 %

Dato’ Syed Faisal Albar bin Syed A.R Albar 8 out of 8 100 %

Datuk Abu Huraira bin Abu Yazid (Resigned w.e.f. 1 Aug 2009) 4 out of 4 100 %

Dato’ Ibrahim Mahaludin bin Puteh 8 out of 8 100 %

Datuk Low Seng Kuan 7 out of 8 88 %

Dato’ C. Krishnan 7 out of 8 88 %

Puan Sri Datuk Nazariah binti Mohd Khalid 8 out of 8 100 %

Wee Hoe Soon @ Gooi Hoe Soon 8 out of 8 100 %

Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin 7 out of 8 88 %

Abdul Hamid bin Sh Mohamed 8 out of 8 100 %

Eshah binti Meor Suleiman (Appointed w.e.f. 25 February 2009) 6 out of 6 100 %

Tan Sri Dato’ Ir Muhammad Radzi bin Haji Mansor(Appointed w.e.f. 21 October 2009) 3 out of 3 100 %



A schedule for Board Meetings and Board Committee meetings for the whole financial year is prepared in advance and tabled to the Board in the month of January every year for approval of the Board. Generally, the Board is scheduled to meet once a month with additional meetings convened as and when deemed necessary.

For each Board and Board Committee meeting, the meeting agenda together with the relevant papers and supporting documents relating to the agenda items are circulated to Board members and/or Board Committee members at least five (5) days before each meeting while Management strives to improve circulation of Board papers to seven (7) days before each meeting. The Board papers are issued in advance to enable the Directors to obtain fur ther information, where necessary, in order to be properly briefed and informed before the meetings.

All Board decisions are clearly recorded in the minutes, including the rationale for each decision, along with clear actions to be taken by responsible parties. Relevant Board decisions are communicated to Management verbally within one (1) working day of the Board meeting and relevant extracts of the minutes are distributed to Management within three (3) working days after the Board meeting.

Board papers are prepared based on a standard format to ensure consistency in the presentation of facts and to fur ther ensure all necessary information is provided to the Board. Each Board paper for approval contains comprehensive information on the objective of the paper, background information, financial effects of the proposal made, issues

for consideration including issues on risk management, other options for consideration, disclosure of interest of a Director or a major shareholder (if applicable), recommendations from Management and action sought from the Board. During meetings, Management and/or advisors (as and when necessary) make presentations on the papers tabled to the Board to facilitate the Board in its decision-making.



The quality of information received by the Board has a direct

impact on the quality of decisions made by the Board. The

Board has, therefore adopted a rating process for papers

and presentations by Management at each Board meeting

whereby the Board members provide constructive feedback

on the quality of information and analysis received in the

Board papers tabled and presentations made through

the completion of a Board Paper Evaluation Form by the

Board members at the end of each Board Meeting. This

process has helped Management to continuously improve

the quality of Board papers. The Directors have access to

all information within the Group to the extent that the

information required is per tinent to the discharge of their

duties as Directors and is for the benefit of the Group. In

order to ensure the Board is consistently and promptly

updated on the Group’s performance, the Board receives

a Corporate Performance Report from Management on a

periodical basis. Each report contains information on the

Group’s year-to-date performance and updates on action

plans under the Company’s Strategic and Business Plans.

In addition, all Directors have access to the advice and services

of the Company Secretary and may seek independent

professional advice should the need arise. In an effort to

fur ther enhance the services of the Company Secretary

to the Board, the Board members provide their respective

feedback on the Company Secretary’s current service

standard through an Internal Customer Satisfaction Survey

designed specifically for the Company Secretary.

Appointment of Board MembersAs Pos Malaysia is a GLC, the Minister of Finance (Incorporated),

which is a body corporate established under the Minister of

Finance (Incorporated) Act 1957 (Amended 1989) (“Special

Shareholder”), holds one (1) Special Rights Redeemable

Preference Share (“Special Share”) in the Company. Under

the Company Articles, the Special Shareholder has the

right from time to time to appoint up to six (6) persons as

Directors of the Company (“Appointed Director”) including

appointment of the Chairman of the Board and the Group

Managing Director/Chief Executive Officer.

During the financial year under review, Tan Sri Dato’ Ir

Muhammad Radzi bin Haji Mansor was appointed to the

Board as a Non-Independent Non-Executive Director of the

Company effective 21 October 2009.

On 23 February 2010, Encik Haizan bin Mohd Khir Johari

was appointed to the Board as a Non-Independent Non-

Executive Director of the Company.

Notwithstanding the right of the Special Shareholder to

appoint Appointed Directors, there is a formal and transparent

procedure in place for the appointment of Board members.

The BNRC is responsible for the deliberation and proposal

of suitable candidates, taking into account the required mix of

skills, calibre, experience and other qualities for appointment

of any proposed director including the Appointed Directors

on the Board before recommendation is made to the

Board for approval. The Committee is also responsible for



reviewing the composition and effectiveness of the Board

and the contributions of each individual Director including

the Appointed Directors, on an annual basis.

The BNRC is also tasked with reviewing the performance

evaluation of the GMD/CEO and Chief Level Officers

of the Company which comprise the Chief Operating

Officers, Group Chief Strategy and Planning and the Chief

Financial Officer. The BNRC also ensures that the level and

composition of remuneration are structured so as to link

rewards with corporate and individual performance.

Re-election of DirectorsThe Company Articles require all Directors of the Company

to retire by rotation at least once in every three (3) years but

are eligible for re-election at the Company’s Annual General

Meeting (“AGM”).

As such, in accordance with the Company Articles, all

Directors, including the Appointed Directors retire from

office at least once in each three (3) years and at least one-

third of the number of Directors is subject to retirement by

rotation at each AGM but shall be eligible to offer themselves

for re-election.

Details of the Directors seeking re-election at the forthcoming

AGM such as their age, qualification, working experience,

other directorships of public companies and position in the

Company are disclosed in the Profile of Directors contained

in this Annual Report.

Directors’ TrainingThe Board recognizes the importance of training as a continuous education process for the Directors in order to ensure that the Directors stay abreast with the latest developments and changes in laws and regulations, business environment and challenges and to equip them with the necessary knowledge and know how to enable the Directors to fulfill their responsibilities and effectively discharge their duties.

As an integral element of the process of recruiting new Board members, new Directors will undergo appropriate orientation in respect of the business of the Group. All the Directors have attended the Mandatory Accreditation Programme.

During the financial year under review, the Directors attended formal training programmes or international study tours. The training programmes attended included International Islamic Capital Market Forum, The Non-Executive Directors Development Series, Bursa Malaysia Evening Talks on Corporate Governance, Finance for Directors and Executive Management, and Integrity Conference 2009-Integrity as Development. In addition, some of the Directors visited postal organisations in Singapore, New Zealand and the United States of America to gain more knowledge about the processes and operations of these foreign postal organizations.



Board CommitteesIn accordance with the Company Articles, the Board delegates certain responsibilities to Board Committees with specified terms of

reference and responsibilities. In the financial year under review, there were three (3) Board Committees: the Audit Committee, the

BNRC and the Tender Board Committee.

(1) Audit Committee

The Audit Committee comprises five (5) Non-Executive Directors, of which, four (4) members including the Chairman of the Committee

are Independent Directors. The members are as follows:-

(a) Datuk Low Seng Kuan

(Chairman/Senior Independent Non-Executive Director)

(b) Mr. Wee Hoe Soon @ Gooi Hoe Soon

(Independent Non-Executive Director)

(c) Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin

(Non-Independent Non-Executive Director)

(d) Encik Abdul Hamid bin Sh Mohamed


(e) Puan Sri Datuk Nazariah binti Mohd Khalid

(Independant Non-Executive Director) (Appointed w.e.f. 12 March 2010)

All the Audit Committee members are financially literate and/

or have strong management experience. Datuk Low Seng

Kuan, Chairman of the Committee is a Chartered Accountant

with the Malaysian Institute of Accountants (MIA) and he was

the Managing Director of Malaysian Sheet Glass Sdn Bhd.

Mr. Wee Hoe Soon @ Gooi Hoe Soon is a member of the

Malaysian Institute of Certified Public Accountants (MICPA)

and the Malaysian Institute of Accountants (MIA) and has

vast experience in the fields of accounting and corporate

finance. Encik Abdul Hamid bin Sh Mohamed is a Fellow of the

Association of Chartered Certified Accountants (ACCA) and

is currently Executive Director of Symphony House Berhad, a

company listed on the Main Market of Bursa Malaysia Securities

Berhad, while Tunku Dato’ Mahmood Fawzy bin Tunku

Muhiyiddin has vast experience in investments and management

and is currently Executive Director of Investments, Khazanah

Nasional Berhad. On the other hand, Puan Sri Datuk Nazariah

binti Mohd Khalid had vast experience in the Malaysian Civil

Service and had served in various capacities prior to her last

post as the Director General of the Malaysian Administrative

Modernisation and Management Planning Unit (MAMPU) in

the Prime Minister’s Department.



The principal functions and duties of the Audit Committee are as follows:-

Review• the quarterly results and annual financial statements of the Company and Group prior to the approval of the

Board.

Assess• the quality and effectiveness of the systems of internal control and the efficiency of the Group’s operations, particularly

those relating to areas of significant risk.

Assess• the internal process for determining and managing key risks other than those that are dealt with by other specific

Board committees.

Review• the evaluation by the internal and external auditors of the Group’s system of internal control and thereafter report

the evaluation to the Board.

Further details on the Audit Committee including its activities during the year under review are contained in the Audit Committee

Report of this Annual Report.

(2) Board Nomination and Remuneration Committee

The BNRC comprises six (6) Non-Executive Directors, of which, four (4) members including the Chairperson of the Committee

are Independent Directors. The members are as follows:-

(a) Puan Sri Datuk Nazariah binti Mohd Khalid

(Chairperson/ Independent Non-Executive Director)

(d) Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin


(b) Datuk Low Seng Kuan

(Senior Independent Non-Executive Director)

(e) Dato’ C. Krishnan a/l Chinapan


(c) Dato’ Ibrahim Mahaludin bin Puteh


(f) Puan Eshah binti Meor Suleiman




The principal functions and duties of the BNRC are as

follows:-

Propose• to the Board suitable candidates for appointment

as Directors including membership and chairmanship of

Board Committees.

Review• on an annual basis the Board structure, size and

composition.

Propose• Succession Planning for the Executive Directors

and Chief Level Officers of the Company.

Assess• on an annual basis the effectiveness of the Board

as a whole, the Board Committees and the contribution

of each individual Director.

Recommend• to the Board the remuneration framework

for the Executive Directors and to fur ther recommend

remuneration package and terms of employment of

the Executive Directors and Chief Level Officers of the

Company.

Recommend to the Board performance contracts and •

Key Performance Indicators (“KPI”) for the Executive

Directors and Chief Level Officers.

(3) Tender Board Committee

The Tender Board Committee comprises four (4) Non

Executive Directors, of which three (3) members are

Independent Directors. The members are as follows:-

(a) Puan Eshah binti Meor Suleiman

(Chairperson/Non-Independent Non-Executive Director)

(b) Dato’ Ibrahim Mahaludin bin Puteh


(c) Puan Sri Datuk Nazariah binti Mohd Khalid


(d) Dato’ C. Krishnan a/l Chinapan


The principal functions and duties of the Tender Board

Committee are as follows:-

Examine• and where appropriate, approve awards of

contracts for supply of goods, works or services within

the limits authorised in the DAL.

Review• selection for the appointment of successful

tenderers for both close and open tender applications.

Review and approve the Company’s procurement •

policies and procedures including general evaluation

criteria, anti-corruption policy and codes of conduct.

Oversee and monitor the overall implementation of the •

Red Book issued by the Putrajaya Committee on GLC

High Performance, the Company’s Procurement Policy

Guidelines and review the efficiency and effectiveness of

the Company’s procurement processes.



B. Directors’ RemunerationThe Board through the BNRC ensures that the level of

remuneration of the Executive Director(s) is sufficient

to attract and retain the Executive Director(s) to manage

the Group successfully. The level and make up of the

remuneration are structured so as to link rewards with

corporate and individual performance. The BNRC determines

the performance contracts and targets and structures the

rewards for the Executive Director(s)’ performance against

these targets. The performance of the Executive Director(s)

and key senior management positions are measured via key

performance indicators that are structured early in the year

to measure the performance of key personnel.

Meanwhile, the Board as a whole determines the fees

payable to Non-Executive Directors and any increase in

Directors’ fees shall be subject to shareholders’ approval at

the Company’s AGM. The Non-Executive Directors are paid

meeting allowances for every Board Meeting that they attend

and the Company also reimburses reasonable expenses

incurred by the Directors in the course of their performance

of duties as Directors.

Details of the remuneration of the Directors of Pos Malaysia for the financial year under review are as follows:-

Category

(Director)

Fees

RM’000

Salaries & Bonus

RM’000

Allowance

RM’000

Total

RM’000

Executive - 1,041 311 1,352

Non-Executive 409 - 445 854

Total 409 1,041 756 2,206



The remuneration band of the Directors of Pos Malaysia for the financial year under review are shown below:-

Range of RemunerationNumber of Directors

Executive Non-Executive

Below RM50,000 - 3

RM50,001 – RM100,000 - 2

RM100,001 – RM150,000 - 5

RM150,001 – RM200,000 - -

RM200,001 – RM250,000 - -

RM250,001 – RM300,000 - -

RM300,001 – RM350,000 - -

RM350,001 – RM400,000 - -

RM400,001 – RM450,000 - -

RM450,001 – RM500,000 - -

RM500,001 – RM550,000 - -

RM550,001 – RM600,000 1* -

RM600,001 – RM650,000 - -

RM650,001 – RM700,000 - -

RM700,001 – RM750,000 - -

RM750,001 – RM800,000 1

* This was the remuneration band of the former Executive Director/Group Chief Operating Officer of the Pos Malaysia Group

until his resignation w.e.f 1 August 2009

Note: The remuneration of Executive Directors are inclusive of the Company’s contribution to provident fund, EPF, salaries, bonus,

gratuity and allowances.



C. Relationship And Communication With Investors And ShareholdersInvestor Relations and Shareholder Communication

The Board acknowledges the importance of communication

with investors and other stakeholders. The Group has

been communicating with stakeholders and investors via

prompt announcements through quarterly financial reports,

distribution of annual reports, quarterly announcements,

relevant circulars and press releases. In addition, the Company

conducts briefings and dialogues with financial analysts via

Investors’ Briefings on a quarterly basis to keep potential

investors informed of the activities and developments within

the Group.

The Company’s website www.pos.com.my also provides an

avenue for keeping the general public updated on the activities

of the Company. The website is a source of information on

the Group’s financial results, services and products, annual

reports, press releases, events, newsletters, media highlights,

and other relevant information.

In the financial year under review, the Board of Directors

of Utilico Emerging Markets Limited, a former substantial

shareholder of Pos Malaysia had visited the Company. The

visit included a site visit to some of the facilities of Pos

Malaysia as well as a dialogue with the Board of Directors

and Senior Management of the Company on the challenges

faced by Pos Malaysia.

General MeetingsThe Company’s general meetings serve as the principal forum

for communicating with the shareholders of the Company.

At general meetings, shareholders have direct access to the

Directors and are given ample opportunity and time to raise

questions or seek fur ther information from the Directors

regarding the Group’s activities, financial performance and

prospects as well as raise any issues of concern regarding

the Group. Besides the Directors, the Senior Management

and the external auditors of the Company are present at

the meetings to assist in providing the necessary responses

to queries from the shareholders. Prior to the tabling of

proposed resolutions at an AGM, the shareholders are

presented with a summary of the Group’s performance on

the financial year under review by the GMD/CEO.

“The Board acknowledges the importance of communication with investors and other stakeholders.”



D. Accountability And AuditFinancial ReportingThe Company’s financial statements are drawn up in

accordance with the provisions of the Companies Act

1965, and applicable approved accounting standards for

entities other than private entities issued by the Malaysian

Accounting Standards Board. In presenting the annual

financial statements and quar terly announcements of results

to shareholders, the Board aims to present a balanced

and understandable assessment of the Group’s position

and prospects. In this regard, the Board also ensures that

the Group uses acceptable accounting policies for its

financial statements, consistently applied and suppor ted by

reasonable and prudent judgement and estimates.

The Audit Committee assists the Board by first reviewing the

financial statements to ensure completeness, accuracy and

validity prior to adoption of the statements by the Board and

subsequent release to Bursa Malaysia Securities Berhad.

The Board also approves the Company’s Annual Budget

and Business Plans and carries out periodic review on the

progress made by the business units.

The Directors’ Responsibility Statement in respect of the

Audited Financial Statement as required under Paragraph

15.26(a) of the Main Market Listing Requirements is contained

in this Annual Report.

Internal ControlThe Board has an overall responsibility for maintaining a

sound system of internal control to provide reasonable

assurance of the effectiveness of the Group’s business

operations and risk management. The Group’s Statement of

Internal Control is detailed in this Annual Repor t.

CompliancePos Malaysia is licensed under the Postal Services Act 1991

to carry out postal services in Malaysia. As such, Pos Malaysia

is subject to the provisions of the Postal Services Act 1991,

terms and conditions set out in the license granted under

the Postal Services Act 1991 and all rules and regulations on

postal services set out under the Postal Services Act 1991.

Pos Malaysia is also subject to the relevant Universal Postal

Union Conventions and Regulations.

The Company Secretary assists the Board in ensuring

compliance by the Company and the Board of Directors with

the Companies Act, the Main Market Listing Requirements

of Bursa Malaysia Securities Berhad and other securities

laws, rules and regulations. The Board is apprised of the

latest amendments and their application to the Company

and/or the Board. As and when necessary, the Company

also seeks clarification through professional opinions on the

extent of application of cer tain obligations and/or duties

enshrined in the said laws, rules and regulations especially

when it concerns duties of directors.

The Company’s Internal Audit function assists the Board and

Management in ensuring compliance by the Company with



other relevant laws, rules and regulations applicable to the

operations of the Company including compliance with the

relevant laws, rules and regulations governing the postal

business and the Company’s internal policies and procedures.

The Internal Audit function conducts regular audit checks on

the Strategic Business Units and other support departments

and divisions on a periodical basis and tables its audit reports

to the Audit Committee for deliberation.

The Company also has an International and Regulatory

Affairs Depar tment which serves as a platform for the

Company to engage with the Malaysian Communication

and Multimedia Commission, which is the regulator of

postal services in Malaysia and other relevant authorities

and/or government bodies to establish and develop the

postal regulatory framework for Malaysia.

Relationship with AuditorsThe Company, through the Audit Committee, has an

appropriate and transparent relationship with the external

auditors. In the course of audit of the Group’s operations, the

external auditors highlight to the Audit Committee and the

Board matters that require the Board’s attention. The external

auditors also report to the Audit Committee on their findings

pertaining to their annual audit.

Further, the external auditors meet the Audit Committee

members without the presence of Management or other

employees pursuant to Paragraph 15.17 of the Main Market

Listing Requirements of Bursa Malaysia Securities Berhad.

During the financial year under review, the external auditors

had two meetings with the Audit Committee members without

the presence of Management. Thereafter, the Audit Committee

shares and discusses with Management all concerns raised by

the external auditors (if any). Thereafter, the necessary action

plans will be formulated and implemented by Management.

Pursuant to the requirement under Paragraph 15.25 of the

Main Market Listing Requirements of Bursa Malaysia Securities

Berhad, the Board is pleased to report that the Company has

applied the principles set out in Part 1 of the Code and that the

Board continues to adopt and comply with the best practices in

corporate governance set out in Part 2 of the Code.

InitiativesThe initiatives that were introduced in year 2008 namely the

Whistle Blowing Policy and the Integrity Pact which were

elaborated in the 2008 Corporate Governance Statement

are currently fully operationalised within the Group.

In addition, in view of the intense challenges faced globally

where five major forces are changing the future of the

postal industry such as changing customer needs, eroding

mail volume, growing competition, rising cost and regulatory

changes, Management had, in August 2009, presented to

the Board and obtained the Board’s approval for the Pos

Malaysia Transformation Masterplan which contains 39

initiatives to address the key issues.

The 3-year transformation plan is anchored on 5 pillars

namely focus on customer needs, operational excellence,

concentrate on core business, unleash talent and capabilities

as well as strengthen the Company’s image.

(This Statement is made in accordance with a resolution of the Board of Directors dated 31 March 2010)



IntroductionTHE BOARD OF DIRECTORS (“the Board”) as guided by

the Bursa Malaysia Securities Berhad’s Statement of Internal

Control – Guidance for Directors of Public Listed Companies

is pleased to provide the following Director’s Statement of

Internal Control which outlines the nature and scope of

internal control of the Group during the period under review.

ResponsibilityThe Board is responsible for ensuring that a sound system

of internal control to safeguard shareholder’s interest and

Company’s assets is maintained. The Board affirms its overall

responsibility for the Group’s system of internal control

which includes the establishment of an appropriate control

environment and framework as well as reviewing its adequacy

and integrity.

As there are limitations that are inherent in any system of

internal control, this system is designed to manage rather

than eliminate risks that may hinder the achievement of the

Group’s business objectives. Accordingly, it can only provide

reasonable but not absolute assurance against material

misstatement or loss. The system of internal control includes

strategic, financial, operational, compliance controls and risk

management procedures.

Risk Management FrameworkPolicy

The Board subscribes to the fact that an effective risk

management practice is a critical component of a sound

system of internal control. In view of this, there is a formal

process to identify, evaluate and manage significant risks

faced by the Group that may impede the achievement of the

Group’s objectives during the period under review.

The Board has a stewardship responsibility to understand

these risks, communicating the requirements of this policy

and to guide the organisation in dealing with these risks.

The policy of the Board is:

To• manage risks proactively;

To• manage risks pragmatically, to acceptable levels given

the particular circumstances of each situation;

To• require that all papers that are put to the Board by

Management relating to strategy, key project approvals,

significant action or investment must include a risk

assessment summary;

To• manage risk routinely and in an integrated and

transparent way in accordance with good governance

practices; and

T• o require that an effective and formalised Enterprise

Risk Management Policy and Procedure Manual (“ERM”)

framework is established and maintained by the Group.



Reporting StructureThe Risk Management Committee (“RMC”) of the Group is chaired by the Group Managing Director / Chief Executive Officer

(“CEO”) and during the period under review, the members are as follows:

Chairman: Dato’ Syed Faisal Albar bin Syed A.R. Albar-Group Managing Director/CEO

Members:

Jezilee M. Ramli• Group Chief, Strategy & Planning (Appointed w.e.f. 03.02.09)

Dato’ Mohd Derus bin Harun• Chief Operating Officer, PosLogistik/ Transport Management

Dato’ Mearia Hamzah• Chief Operating Officer, PosNiaga

Haji Ahmad Nadzarudin Abdul Razak• Chief Operating Officer, PosLaju

Bahaman bin Kamaruzzaman• Covering Chief Operating Officer, PosMel/ Group Head, Transformation Management Office

Mohd Lutfi bin Mat Lazim• Chief Financial Officer

Mohd Rosdeen bin Hassan• Chief Information Officer

Datuk Abu Huraira bin Abu Yazid• Executive Director (resigned w.e.f. 01.08.09)

Dato’ Mohamed Hazlan bin Mohamed Hussain• Chief Operating Officer, PosMel (resigned w.e.f. 31.03.09)

Dr. R. Hanafi bin Abdullah• Group Head, Human Resource and Administration (resigned w.e.f. 05.01.10)

The RMC’s principal roles and responsibilities, which are stipulated in the ERM policy, are as follows:

Monitor policy implementation and the continuous development of the risk management in the organisation;•

Formulate policy, business rules, processes and structures to meet policy implementation needs;•

Implement the processes and resource the structures; •

Agree with risk parameters and controls;•

Initiate and conduct business within agreed risk constraints and business rules; •

Ensure that periodical risk reports are submitted accurately and in a timely manner to the Audit Committee and Board; and•

Articulate and challenges the key risks, controls and elements of better practice and also offers support and advice.•



The Corporate Risk Management Depar tment (“CRMD”)

will act as a suppor t for the RMC in monitoring, analysing

and repor ting of the risks identified enterprise-wide and

as the facilitator in the risk assessment process. CRMD will

continuously evaluate the risk policy and procedures, and

initiate improvements by maintaining awareness of trends

and developments in risk management that may have

significant impact to the organisation.

Risk owners and co-owners have been identified to

ensure that the risk registers and risk profiles are updated

accordingly. The risk registers and risk profiles of each

SBU’s, depar tments and the main subsidiary companies are

updated quar terly and the consolidated repor ts are tabled

to the RMC and the Audit Committee.

The Internal Audit Department is involved in validating the

results of the ERM processes. The Internal Audit function

examines the risk management systems for its effectiveness.

The Board and the Management continuously review and

enhance the ERM framework to ensure that ERM practices are

aligned with the latest ERM development and best practices.

Other Key Elements of Internal ControlThe other key elements of the Group’s internal control

systems are described below:

The• roles and responsibilities of the Board of Directors,

Risk Management Committee, Business and Support

Units and State offices in respect of Risk Management

are defined in the Risk Management Policy.

The• lines of responsibility and frequency of reporting of

risks are also defined in the Risk Management Policy.

Operating• policies and procedures, which incorporate

regulatory and internal requirements, are prescribed in

Operating Procedures and Circulars. The documents are

updated as and when necessary to meet the continually

changing operational needs.

The• Board meets at least quarterly to review the

Group’s operational and financial performance against

approved budget, approve quarterly report to Bursa

Malaysia Securities Berhad and deliberate on issues that

require the Board’s approval. In addition, the Board is

also updated on the changes in the business environment

that may adversely affect business performance and

relevant actions taken.

The• Audit Committee, together with the Internal

Audit Department provides an assessment on the

adequacy, efficiency and effectiveness of the Group’s

internal control system. The Internal Audit Department

recommends improvements where necessary.



The monitoring, review and reporting arrangements in place give reasonable assurance that the structure of controls and its

operations are appropriate to the Group’s operations and that risks are at an acceptable level throughout the Group. However, the

arrangements do not eliminate the possibility of human error or deliberate circumvention of control procedures by employees.

The Board believes that the development of the system of internal control is an ongoing process and has taken steps throughout

the year to improve its internal control system and will continue to do so.

Weakness in Internal Control that Result in Material LossesTo the best of the Board’s knowledge, there were no material losses incurred during the period under review as a result

of weaknesses in internal control. Management continues to take measures to improve and strengthen the internal control

environment.

(This Statement is made in accordance with the resolution of the Board of Directors dated 31st March 2010)


Directors’ Responsibility Statement

Pursuant to Paragraph 15.26(a) of the Main Market Listing

Requirements of Bursa Malaysia Securities Berhad, the

Board of Directors is required to include a statement in the

Company’s Annual Report explaining its responsibility for

preparing the annual audited financial statements.

In preparing the financial statements of the Company and the

Group for the financial year ended 31 December 2009, the

Directors are satisfied that the Company and the Group have

used appropriate accounting policies, consistently applied

and supported by reasonable and prudent judgements

and estimates. The Directors are also satisfied that all

applicable approved accounting standards for entities other

than private entities issued by the Malaysian Accounting

Standards Board and the provisions of the Companies Act,

1965 have been complied.

The Directors are responsible for ensuring that the Company

and companies within the Group keep accounting records

which disclose with reasonable accuracy the financial position

of the Company and of the Group. In addition, the Directors

are responsible to take such steps as are reasonably open to

them to safeguard the assets of the Group and to prevent

and detect fraud and other irregularities.

(This Statement is made in accordance with a resolution of

the Board of Directors dated 31 March 2010.)

“The Directors are responsible to take such steps as are reasonably open to them

to safeguard the assets of the Group.”



“The Directors are satisfied that the Company and the Group have used appropriate accounting policies, consistently applied and supported by reasonable and prudent judgements

and estimates.”


Additional Compliance Information

Utilisation of Proceeds1.

During the financial year ended 31 December 2009,

there were no proceeds raised by the Company from

any corporate proposals.

Share buy-back 2.

During the financial year under review, the Company

has not exercised any share buy-back permitted by

Section 67A of the Companies Act, 1965.

Options, Warrants or Convertible Securities3.

During the financial year, the Company did not issue or

exercise any ESOS, warrants or conver tible securities.

American Depository Receipt (ADR) /Global 4.

Depository Receipt (GDR)


the Company did not sponsor any ADR and GDR.

Sanctions and/or Penalties5.

During the financial year under review, there were no

sanctions and/or penalties imposed on the Company

and its subsidiaries, directors or management by the

relevant regulatory bodies.

Variation in Results6.

There is no variance in the Company’s audited financial

results for the financial year ended 31 December 2009

from the unaudited results as previously announced.

The Company has not released or announced any

estimated profit, financial forecast and projection in the

financial year ended 31 December 2009.

Profit Guarantee7.


the Company did not give any profit guarantee.

Material Contracts8.

There were no material contracts entered into by the

Company or its subsidiaries involving the directors and

substantial shareholders, either still subsisting at the end of

the financial year ended 31 December 2009, or entered

into since the end of the previous financial year.

Revaluation Policy 9.


the Company did not have any revaluation policy on

landed proper ties.



Non- Audit Fees10.

The amount of non-audit fees paid and payable to

external auditors by the Group for the financial year

ended 31 December 2009 is RM60,120 which includes

the review on FRS 8, Statement of internal control and

advisory on corporatisation of PosLaju.


The Board of Directors of Pos Malaysia is pleased to present the report on the Audit Committee of the Board for the financial

year ended 31st December 2009.

Members and MeetingsThe Audit Committee of Pos Malaysia had convened seven (7) meetings during the financial year under review. The details of the

Pos Malaysia Audit Committee members and the attendance of their meetings are as follows:

Members

(a) Datuk Low Seng Kuan Senior Independent Non-Executive Director

Chairman

(b) Mr. Wee Hoe Soon @ Gooi Hoe SoonIndependent Non-Executive Director

Member

(c) YM Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin Non-Independent Non-Executive Director

Member

(d) Abdul Hamid bin Sh Mohamed Independent Non-Executive Director

Member

(e) Puan Sri Datuk Nazariah binti Mohd Khalid*Independent Non-Executive Director

Member

Attendance of Meetings

Members Total

(a) Datuk Low Seng Kuan 6 / 7

(b) Wee Hoe Soon @ Gooi Hoe Soon 7 / 7

(c) YM Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin 7 / 7

(d) Abdul Hamid bin Sh Mohamed 7 / 7

(e) Puan Sri Datuk Nazariah binti Mohd Khalid* N/A

* Puan Sri Datuk Nazariah binti Mohd Khalid was appointed to the Audit Committee on 12 March 2010




Terms of ReferenceThe Terms of Reference of the Audit Committee are in line with the Listing Requirements of Bursa Malaysia Securities Berhad and

the Malaysian Code on Corporate Governance. The Terms of Reference of the Audit Committee are as follows:-

Composition of CommitteeThe Audit Committee shall be appointed by the Board of

Directors upon recommendation of the Board Nomination

and Remuneration Committee which meets the following

requirements:-

• The Audit Committee shall consist of not less than three (3)

members;

• All the members of the Audit Committee must be non-

executive directors, with a majority of them being independent

directors as defined under the Listing Requirements of Bursa

Malaysia Securities Berhad (‘Listing Requirements’);

• At least one (1) member of the Audit Committee must meet

the criteria set by the Listing Requirements as follows:-

M• ust be a member of the Malaysian Institute of Accountants; or

If • he/she is not a member of the Malaysian Institute of Accountants, he must have at least three (3) years working experience; and

He/sh• e must have passed the examinations specified in Part I of the 1st Schedule of the Accountants Act 1967; or he/she must be a member of one (1) of the associations of accountants specified in Part II of the 1st Schedule of the Accountants Act 1967; or

Fulfi• ls such other requirements as prescribed or approved by the Bursa Malaysia Securities Berhad.

• The members of the Audit Committee shall elect a Chairman

from among themselves who shall be an Independent

Director;

• No Alternate Director should be appointed as a member of

the Audit Committee;

• In the event of any vacancy in the Audit Committee resulting

in the non-compliance of the Listing Requirements pertaining

to composition of the Audit Committee, the Board of

Directors shall within three (3) months of that event fill the

vacancy;

• The Audit Committee members shall collectively:-

(a) Have knowledge of the industries in which the Group

operates; and

(b) Have the ability to understand key business and financial

risks as well as related controls and control processes.

• All members of the Audit Committee shall also be

financially literate i.e. have the ability to read and understand

fundamental financial statements, including a Company’s

balance sheet, income statement, statement of cash flow and

key performance indicators.



Audit Committee MeetingsThe Audit Committee Meetings shall be held not less than

four (4) times a year. In addition to the members of the

Audit Committee, the meeting shall be attended by the

Managing Director/Group Chief Executive Officer, Chief

Financial Officer and Chief Internal Auditor. Other members

of the Board, senior management and external auditors’

representatives may attend the meetings upon invitation

of the Audit Committee. The auditors, both internal and

external, may request a meeting if they deem necessary.

The quorum for a meeting of the Audit Committee shall

comprise a majority of Independent Directors from among

its members. In the absence of the Chairman, the members

present shall elect a chairman for the meeting from among

the member present. Minutes of each meeting shall be kept

and distributed to each member of the Audit Committee

and of the Board. The Audit Committee shall report on each

meeting to the Board. The Secretary to the Audit Committee

shall be the Company Secretary or any other person as the

Committee may decide.

Rights and AuthorityThe duties of the Audit Committee shall be in accordance

with the same procedures adopted by the Board:-

• Have authority to investigate any activity within its Terms of Reference;

• Have the resources which are required to perform its duties;

• Have full and unrestricted access to any employee and

information pertaining to the Group. All documents of the

Group shall be made accessible to the Audit Committee

and all employees are directed to co-operate with the

request made by the Audit Committee;

• Have direct communication channels with the external

auditors and person(s) carrying out the internal audit

function or activity for the Group; and

• Be able to engage independent professional advisers or

other advisers and to secure attendance of other third

parties with relevant experience and expertise if it

considers necessary.

Notwithstanding anything to the contrary, the Audit

Committee does not have executive powers and shall report

to the Board of Directors on matters considered and its

recommendation thereon, relating to the Group and the

Company.

Review of the Audit CommitteeThe performance of the Audit Committee and each of the

members shall be reviewed by the Board of Directors at

least once every three (3) years to determine whether the

Committee and its members have carried out their duties in

accordance with their Terms of Reference in the Corporate

Governance Statement.

Audit Committee ReportAudit Committee Report


Responsibilities and DutiesThe responsibilities and duties of the Audit Committee are

as follows:

a. Risk Management

To review the adequacy and effectiveness of Enterprise Risk

Management (“ERM”), reporting structures, risk profiles and

governance processes.

b. Internal Audit

• To approve the appointment, replacement and dismissal of

the Chief Internal Auditor and his deputy;

• To review the adequacy of the scope, functions, competency

and resources of Internal Audit Department and that it

has the necessary authority to carry out its work;

• To review and approve the Annual Risk Based Audit Plan,

Key Performance Indicators and subsequently appraise

the performance of the Internal Audit Department;

• To monitor the effectiveness in the implementation of the

Whistleblowing Policy and procedure and other related

governance processes;

• To review the internal audit reports on significant/ major

audit findings and management’s responses to ensure that

appropriate and adequate remedial actions are taken by

the management; and

• To review the systems of internal controls with the

auditors.

c. External Audit

• To review the external auditors’ audit plan, scope of their

audits and their management letters and ensure appropriate

and adequate remedial actions are taken by management

on significant lapses in controls and procedures that are

identified;

• To assess the performance of the external auditors and

make recommendations to the Board of Directors on

their appointment and removal;

• To recommend the nomination of external auditors, their

audit fees and resignation or dismissal of external auditors

and thereafter report the same to the Board;

• To review the quarterly and annual financial statements of

the Group and the Company focusing on the matters set

out below, and thereafter submits the same to the Board:-

Any• changes in or implementation of major accounting

policies and practices;

Major judgmental areas, significant and unusual events;•

Significant adjustments arising from the audit;•

Going concern assumption; and•

Compliance with Accounting Standards and regulatory •

requirements.

• To discuss problems and reservations arising from the

interim and final audits and any matter the external

auditors may wish to discuss.

d. Other Matters

• To review related party transactions entered into by

the Group and the Company and to ensure that such

transactions are undertaken on the Group’s normal

commercial terms and that the internal control procedures

with regards to such transactions are sufficient.

• Any other functions as may agreed to by the Committee

and the Board.



• Where the Audit Committee is of the view that a matter

reported to the Board of Directors has not been

satisfactorily resolved resulting in a breach of the listing

requirements of Bursa Malaysia Securities Berhad, the

Committee has the responsibility to properly report such

matter to Bursa Malaysia Securities Berhad.

Summary of ActivitiesDuring the year, the Audit Committee carried out the

following activities:-

Financial ReportingRevieweda. quarterly and annual financial reports of the

Group and the company prior to submission to the Board

of Directors for approval. The review was to ensure that the

financial reporting and disclosure are in compliance with:

Provisions of the Companies Act 1965;•

Listing requirements of Bursa Malaysia Securities Berhad;•

Applicable approved accounting standards in Malaysia; and•

Other legal and regulatory requirements. •

In the review of the annual audited financial statements,

the Audit Committee discussed with Management and the

external auditors, the accounting principles and standards

that were applied and their judgement of the items that may

affect the financial statements.

Internal AuditRevieweda. the risk-based annual audit plan to ensure

adequacy of the scope and coverage of major risk areas

of the Group;

Reviewedb. the Key Performance Indicators of the Internal

Audit Department and appraised the department’s

performance and competency level;

Reviewedc. the effectiveness of the audit process, resource

requirements for the year ;

Reviewedd. the internal audit reports which were tabled

during the year, the audit recommendations made and

management’s responses to these recommendations where

appropriate, the committee has directed management

to rectify and improve internal controls and Standard

Operating Procedures based on the internal auditor’s

recommendations and suggestions for improvement;

Monitorede. the corrective actions on the outstanding audit

issues to ensure that all the key risks and control lapses

had been addressed; and

Monitoredf. internal audit activities and the staffing

requirements, skills and the core competency of the

Internal Auditors.



External AuditorsRevieweda. the external auditors:-

their • audit plan, audit strategy and scope of work for the year ;

the• results of annual audit, their audit reports and management letter together with management’s

response to the findings of the external auditors;

Evaluatedb. the performance and the effectiveness of the external auditors and made recommendations to the Board of Directors on their appointment and remuneration.

Related Party TransactionsReview related party transactions entered into by the Group

and the company and the disclosure of such transactions as

per the regulatory requirements.

Internal Audit FunctionThe Audit Committee is assisted by the Internal Audit

Department to effectively discharge its duties and

responsibilities. The Internal Audit Department reports

directly to the Audit Committee. In 2009, there were seven

(7) Audit Committee meetings held to deliberate on major

audit findings. In general, the Internal Audit Department

provides an independent assurance on the adequacy and

effectiveness of internal controls, corporate risk management

and overall governance processes.

Annually, the Internal Audit Department prepares a risk based

audit plan and presents to the Audit Committee for approval. In

view of scarce resources, the risk based audit plan gives priority and

focuses on company’s top risks identified by the management.

The audit scope includes performing audit reviews at Strategic

Business Units (“SBU”s), States Management Offices, Support

Services Departments and subsidiaries.

The audits cover the reviews on:-

the adequacy of internal controls;1.

the effectiveness and efficiency of operations;2.

the accuracy of financial and operational information;3.

the compliance with internal policy & procedure, 4.

regulatory and statutory requirements;

the adequacy and effectiveness of IT systems in 5.

supporting operations; and

the effectiveness of risk management processes and the 6.

implementation of controls by management to mitigate

company’s major risks.

The Internal Audit Department shows a high level of

professional expertise, with qualified and experienced

auditors who consistently show their competency through

the high quality and usefulness of the audit product over time.

The Internal Audit Department also conducted ad-hoc

assignments and investigation audits requested by the

Audit Committee and management. Further, Internal Audit

Department conducts regular follow-up on the closing of

audit issues with input from the management.



In ensuring effective communication of audit issues to all operational areas and prompt closing of audit issues, meetings were held

with the management on a regular basis. Management is responsible for ensuring that corrective actions on reported weaknesses

and suggested improvements as recommended are taken within the required time frame.

The Internal Audit Department also provides consultancy services to the management in evaluating the risk exposures of new

business products and projects prior to implementation and ensures that controls are in place to mitigate risks identified. The

Internal Audit Department continues to assist management in supporting the Whistleblowing policy and the Integrity Pact

established in 2008 to ensure transparency and integrity throughout the tendering process.

The Internal Audit Department independently reviews the risk management governance processes to ensure their adequacy and

effectiveness and reports to the Audit Committee on a periodical basis.

One hundred percent of the internal audit activities for the year under review were conducted by the inhouse staff of the Internal Audit

Department. Total budget for the Internal Audit function at Pos Malaysia in the year ending 31 December 2009 was RM2.6 million.

_____________________Datuk Low Seng KuanChairmanAudit Committee


DIRECTORS’ REPORT AND FINANCIAL STATEMENTS


DIRECTORS’ REPORT AND FINANCIAL STATEMENTS


The Directors have pleasure in submitting their report and the

audited financial statements of the Group and of the Company

for the year ended 31 December 2009.

Principal activities

The principal activities of the Company during the financial

year are to provide postal and its related services which include

receiving and dispatching of postal articles, postal financial

services, dealing in philatelic products and sale of postage stamps.

The principal activities of the subsidiaries and associates are

stated in Notes 8 and 9 respectively to the financial statements.

There has been no significant change in the nature of these

activities during the financial year.

Results

GroupRM’000

CompanyRM’000

Profit attributable to:

Shareholders of the Company 75,415 69,072

Minority interest 1,296 -

76,711 69,072

Reserves and provisions

There were no material transfers to or from reserves and provisions during the year under review except as disclosed in the financial statements.

Dividends

Since the end of the previous financial year, the Company paid a final ordinary dividend of 10 sen per ordinary share less tax at 25% totalling RM40,277,000 in respect of the year ended 31 December 2008 on 25 June 2009.

The final dividends recommended by the Directors in respect of the year ended 31 December 2009 is 12.5 sen per ordinary share less tax at 25% totalling RM50,346,000 and is subject to the approval of the shareholders at the forthcoming Annual General Meeting.

Directors of the Company

Directors who served since the date of the last report are:

Tan Sri Dato’ Seri (Dr.) Aseh bin Haji Che Mat •

Dato’ Syed Faisal Albar bin Syed A.R Albar•

Tan Sri Dato‘ Ir Muhammad Radzi bin Haji Mansor (appointed •

on 21.10.2009)

Datuk Low Seng Kuan •

Dato’ Krishnan a/l Chinapan•

Puan Sri Datuk Nazariah binti Mohd Khalid •

Dato’ Ibrahim Mahaludin bin Puteh •

Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin•

Wee Hoe Soon @ Gooi Hoe Soon •

Abdul Hamid bin Sh. Mohamed •

Eshah binti Meor Suleiman •

Haizan bin Mohd Khir Johari (appointed on 23.02.2010)•

Datuk Abu Huraira bin Abu Yazid (resigned on 01.08.2009)•

Directors’ Report


Directors’ interests

None of the Directors holding office at 31 December 2009 had any interest in the ordinary shares of the Company and of its related

corporations during the financial year.

Directors’ benefits

Since the end of the previous financial year, no Director of the Company has received nor become entitled to receive any benefit

(other than a benefit included in the aggregate amount of emoluments received or due and receivable by Directors as shown

in the financial statements or the fixed salary of a full time employee of the Company or of related companies) by reason of a

contract made by the Company or a related corporation with the Director or with a firm of which the Director is a member, or

with a company in which the Director has a substantial financial interest.

There were no arrangements during and at the end of the financial year which had the object of enabling Directors of the Company

to acquire benefits by means of the acquisition of shares in or debentures of the Company or any other body corporate.

Issue of shares and debentures

There were no changes in the authorised, issued and paid-up capital of the Company during the financial year.

Employee Share Option Scheme (“ESOS”)

The Company had on 31 October 2007 implemented the ESOS upon the completion of the restructuring exercise of Pos

Malaysia & Services Holdings Berhad for the purpose of continuing the objectives under the Pos Malaysia & Services Holdings

Berhad’s ESOS. The ESOS is governed by the ESOS Bye-laws which were approved by the shareholders on 28 June 2007. The

ESOS is in force for a period from 31 October 2007 up to 23 June 2008.

Details of the ESOS are set out in Note 14(c) of the financial statements.

Options granted over unissued shares

No options were granted to any person to take up unissued shares of the Company during the financial year.



Directors’ Report

Other statutory information

Before the balance sheets and income statements of the

Group and of the Company were made out, the Directors

took reasonable steps to ascertain that:

all known bad debts have been written off and adequate i.

provision made for doubtful debts, and

all current assets have been stated at the lower of cost and ii.

net realisable value.

At the date of this report, the Directors are not aware of

any circumstances:

that would render the amount written off for bad debts, i.

or the amount of the provision for doubtful debts, in the

Group and in the Company inadequate to any substantial

extent, or

that would render the value attributed to the current assets ii.

in the Group and in the Company financial statements

misleading, or

which have arisen which render adherence to the existing iii.

method of valuation of assets or liabilities of the Group

and of the Company misleading or inappropriate, or

not otherwise dealt with in this repor t or the financial iv.

statements, that would render any amount stated

in the financial statements of the Group and of the

Company misleading.

At the date of this report, there does not exist:

any charge on the assets of the Group or of the Company i.

that has arisen since the end of the financial year and

which secures the liabilities of any other person, or

any contingent liability in respect of the Group or of the ii.

Company that has arisen since the end of the financial year.

No contingent liability or other liability of any company in

the Group has become enforceable, or is likely to become

enforceable within the period of twelve months after the end

of the financial year which, in the opinion of the Directors,

will or may substantially affect the ability of the Group and

of the Company to meet their obligations as and when they

fall due.

In the opinion of the Directors, the financial performance of

the Group and of the Company for the financial year ended

31 December 2009 have not been substantially affected

by any item, transaction or event of a material and unusual

nature nor has any such item, transaction or event occurred

in the interval between the end of that financial year and the

date of this report.


Auditors

The auditors, Messrs KPMG, have indicated their willingness to accept re-appointment.

Signed on behalf of the Board of Directors in accordance with a resolution of the Directors:

Tan Sri Dato’ Seri (Dr.) Aseh bin Haji Che Mat Dato’ Syed Faisal Albar bin Syed A.R Albar Date: 31 March 2010



Group Company

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Assets:

Property, plant and equipment 4 273,694 232,901 256,999 213,679

Intanglible asset 5 4,630 - - -

Prepaid lease payments 6 262,135 273,707 182,414 193,407

Investment properties 7 15,071 15,071 - -

Investments in subsidiaries 8 - - 41,284 32,784

Investments in associates 9 - - - -

Other investments 10 208,492 219,951 210,654 211,215

Deferred tax assets 16 85 376 - -

Total non-current assets 764,107 742,006 691,351 651,085

Other investments 10 4,967 7,643 4,967 7,643

Inventories 11 8,692 6,215 4,736 3,659

Receivables, deposits and prepayments 12 177,507 179,004 237,077 246,777

Current tax assets 1,453 2,715 - 1,327

Cash and cash equivalents 13 317,861 600,258 276,554 579,656

Total current assets 510,480 795,835 523,334 839,062

Total assets 1,274,587 1,537,841 1,214,685 1,490,147

Balance Sheets at 31 December 2009


Group Company

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Equity:

Share capital 14 268,513 268,513 268,513 268,513

Share premium 14 385 385 385 385

Retained earnings 15 530,695 495,557 467,001 438,206Total equity attributable to equity holders of the Company 799,593 764,455 735,899 707,104

Minority interest - 2,574 - -

799,593 767,029 735,899 707,104

Liabilities:

Deferred tax liabilities 16 14,503 10,655 13,657 10,203

Hire purchase creditors 17 23,829 27,066 23,792 27,016

Total non-current liabilities 38,332 37,721 37,449 37,219

Payables and accruals 18 422,212 725,469 427,098 738,933

Current tax liabilities 6,054 718 5,856 -

Hire purchase creditors 17 8,396 6,904 8,383 6,891

Total current liabilities 436,662 733,091 441,337 745,824

Total liabilities 474,994 770,812 478,786 783,043

Total equity and liabilities 1,274,587 1,537,841 1,214,685 1,490,147

The accompanying ‘Notes to the financial statement’ are an integral part of these financial statements.



Group Company

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Revenue 19 902,561 921,666 872,220 874,171

Raw materials and consumables used (13,582) (21,580) (6,182) (6,535)

Staff costs (512,271) (513,282) (501,926) (503,539)

Rental, communication and utilities (53,012) (47,250) (51,276) (45,658)

Transportation (108,590) (125,706) (107,531) (121,437)

Maintenance and supplies (46,862) (50,213) (44,111) (47,101)

Depreciation of property, plant and equipment (37,589) (29,098) (35,446) (26,964)

Amortisation of prepaid lease payments (11,366) (11,369) (10,993) (10,977)

Other operating expenses (36,936) (36,939) (34,612) (30,910)

Results from operating activities 82,353 86,229 80,143 81,050

Other operating income

- interest income 12,860 18,919 12,624 17,956

- others 10,964 12,307 8,462 11,950

Write back of / (Allowance for) impairment losses 4,892 (116,098) 1,978 (97,647)

Share of results after tax of equity accounted associate

- (1,043) - -

Finance cost (1,805) (833) (1,802) (831)

Profit / (Loss) before tax 20 109,264 (519) 101,405 12,478

Tax expense 22 (32,553) (32,783) (32,333) (31,237)

Profit / (Loss) for the year 76,711 (33,302) 69,072 (18,759)

Attributable to:

Equity holders of the Company 75,415 (35,876)

Minority shareholders 1,296 2,574

Profit / (Loss) for the year 76,711 (33,302)

Basic earnings (loss) per ordinary share (sen) 23 14 (6)

Income Statements For The Year Ended 31 December 2009


Non distributable Distributable

ShareCapital*

Share Premium

RetainedProfits

MinorityInterest

Total

Group RM’000 RM’000 RM’000 RM’000 RM’000

At 1 January 2008 268,369 - 591,022 - 859,391

Loss for the year - - (35,876) 2,574 (33,302)

Issue of shares 144 385 - - 529

Dividends to shareholders - - (59,589) (59,589)

At 31 December 2008/ 1 January 2009 268,513 385 495,557 2,574 767,029

Profit for the year - - 75,415 1,296 76,711

Dividends to shareholders - - (40,277) - (40,277)

Acquisition of minority interest - - - (3,870) (3,870)

At 31 December 2009 268,513 385 530,695 - 799,593

Company RM’000 RM’000 RM’000 RM’000

At 1 January 2008 268,369 - 516,554 784,923

Loss for the year - - (18,759) (18,759)

Issue of shares 144 385 - 529


At 31 December 2008/ 1 January 2009 268,513 385 438,206 707,104

Profit for the year - - 69,072 69,072


At 31 December 2009 268,513 385 467,001 735,899

* Share capital includes the Special Rights Redeemable Preference Share of RM1.00. Refer to Note 14(b) the financial statements for details of the terms and rights

attached to Special Rights Redeemable Preference Share.


Statement Of Changes In Equity For The YearEnded 31 December 2009

Attributable to equity holders of the Company



Group Company

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Cash flows from operating activities

Profit/ (Loss) before tax 109,264 (519) 101,405 12,478

Adjustments for :

Amortisation of premium 561 660 561 660

Gain on disposal of unquoted shares (2,602) - - -

Gain on disposal of marketable securities (620) (4,817) (620) (4,817)

Depreciation of property, plant and equipment 4 37,589 29,098 35,446 26,964

Amortisation of prepaid lease payments 6 11,366 11,369 10,993 10,977

Gain on disposal of property, plant & equipment (2,404) (955) (2,404) (975)

(Gain)/loss on redemption of unquoted private debt securities

- (24) - 329

Property, plant and equipment written off - 6 - 6

Prepaid lease payments written off 206 - - -

Allowance for dimunition in value 10 - 87,032 - 87,032

(Reversal)/write down of quoted shares in Malaysia 10 (2,220) 10,615 (2,220) 10,615

Net (reversal of)/allowance for doubtful debts:

- trade receivables 12 (1,920) 3,421 (1,884) (98)

- other receivables 12 (2,914) 18,451 - -

Interest income (12,860) (18,919) (12,624) (17,956)

Dividend income (149) (1,011) (149) (1,011)

Share of results after tax of equity accounted associate - 1,043 - -

Interest expense 1,805 833 1,802 831

Operating profit before changes in working capital 135,102 136,283 130,306 125,035

Inventories (2,477) (3,030) (1,077) (1,906)

Receivables, deposits and prepayments 6,331 (42,929) 11,584 (38,889)

Payables and accruals (10,584) 45,529 (19,162) 44,290

Cash generated from operations 128,372 135,853 121,651 128,530

Cash Flow Statements For The YearEnded 31 December 2009


Group Company

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Taxes paid (21,816) (41,790) (21,696) (40,177)

Net cash generated from operating activities 106,556 94,063 99,955 88,353

Cash flows from investing activities

Proceeds from disposal of unquoted shares 13,500 - - -

Proceeds from redemption of unquoted private debt securities

- 40,000 - 40,000

Proceeds from diposal of marketable securities (net) 5,516 24,340 5,516 24,340

Proceeds from disposal of property, plant & equipment 2,611 964 2,611 1,003

Purchase of property, plant and equipment (i) (71,477) (69,456) (71,861) (65,520)

Interest received 12,860 18,919 12,624 17,956

Net dividend received 149 878 149 878

Increase in investment in a subsidiary 8(a) (8,500) - (8,500) -Net cash (used in)/generated from investing activities (45,341) 15,645 (59,461) 18,657

Cash flows from financing activities

Issue of new shares - 529 - 529

Repayment of hire purchase (8,857) (3,338) (8,844) (3,333)

Interest expense (1,805) (833) (1,802) (831)

Dividends paid (40,277) (59,589) (40,277) (59,589)

Net cash used in financing activities (50,939) (63,231) (50,923) (63,224)

Movement in cash and cash equivalents 10,276 46,477 (10,429) 43,786

Opening cash and cash equivalents 171,501 125,024 150,899 107,113

Closing cash and cash equivalents 181,777 171,501 140,470 150,899



Cash and cash equivalents included in the cash flow statements comprise the following balance sheet amounts:

Group Company

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Cash and bank balances 13 119,219 91,504 87,916 79,656

Deposits 13 198,642 508,754 188,638 500,000

317,861 600,258 276,554 579,656

Less:

Cash held for the purpose of distribution of fuel rebatefor the government

(4,257) (309,799) (4,257) (309,799)

Collection on behalf of agency creditors (131,827) (118,958) (131,827) (118,958)

181,777 171,501 140,470 150,899

(i) Purchase of property, plant and equipment

During the year, the Group and Company acquired property, plant and equipment with an aggregate cost of RM78,589,000

(2008 - RM106,764,000) and RM78,973,000 (2008 - RM102,760,000) of which RM7,112,000 (2008 – RM41,466,000) and

RM7,112,000 (2008 - RM41,391,000) respectively, were acquired by means of hire purchase.


Notes to the Financial StatementsCash Flow Statements For The YearEnded 31 December 2009 (Continued)


Pos Malaysia Berhad is a public limited liability company,

incorporated and domiciled in Malaysia and is listed on

the Main Market of the Bursa Malaysia Securities Berhad.

The addresses of its registered office and principal place of

business are as follows:

Registered office/Principal place of business

Level 33, Menara Dayabumi

Jalan Sultan Hishamuddin

50050 Kuala Lumpur

The consolidated financial statements of the Company as at

and for the year ended 31 December 2009 comprise the

Company and its subsidiaries (together referred to as the

Group) and the Group’s interest in associates. The financial

statements of the Company as at and for the year ended 31

December 2009 do not include other entities.

The principal activities of the Company during the financial

year are to provide postal and its related services which

include receiving and dispatching of postal ar ticles, postal

financial services, dealing in philatelic products and sale of

postage stamps. The principal activities of the subsidiaries

and associates are stated in Notes 8 and 9 respectively to

the financial statements.

The financial statements were approved by the Board of

Directors on 31 March 2010.

1. BASIS OF PREPARATION

(a) Statement of complianceThe financial statements of the Group and of the Company

have been prepared in accordance with Financial Reporting

Standards (“FRS”), accounting principles generally accepted

and the Companies Act, 1965 in Malaysia.

During the year, the Group has chosen to early adopt

FRS 8, Operating Segments, which is effective for annual

periods beginning 1 July 2009. The accounting policy in

relation to this standard is disclosed in Note 2(s) to the

financial statements.

The Group and Company have not applied the following

accounting standards, amendments and interpretations

that have been issued by the Malaysian Accounting

Standards Board (“MASB”) but are not yet effective for

the Group and Company:

FRSs, Interpretations and amendments effective for

annual periods beginning on or after 1 January 2010

FRS 4, Insurance Contracts •

FRS 7, Financial Instruments: Disclosures•

FRS 101, Presentation of Financial Statements (revised)•

FRS 123, Borrowing Costs (revised)•

FRS 139, Financial Instruments: Recognition and •

Measurement

Amendments to FRS 1, First-time Adoption of Financial •

Reporting Standards

Amendments to FRS 2, Share-based Payment: Vesting •

Conditions and Cancellations




Amendments to FRS 7, Financial Instruments: •

Disclosures

Amendments of FRS 101, Presentation of Financial •

Statements - Puttable Financial Instruments and

Obligations Arising on Liquidation

Amendments to FRS 127, Consolidated and Separate •

Financial Statements: Cost of an Investment in a

Subsidiary, Jointly Controlled Entity or Associate


Presentation - Puttable Financial Instruments and

Obligations Arising on Liquidation Separation of

Compound Instruments


Recognition and Measurement - Reclassification of

Financial Assets

Collective Assessment of Impairment for Banking •

Institutions

Improvements to FRSs (2009)•

IC Interpretation 9, Reassessment of Embedded •

Derivatives

IC Interpretation 10, Interim Financial Reporting and •

Impairment

IC Interpretation 11, FRS 2 - Group and Treasury •

Share Transactions

IC Interpretation 13, Customer Loyalty Programmes •

IC Interpretation 14, FRS 119 - The Limit on a Defined •

Benefit Asset, Minimum Funding Requirements and

Their Interaction

FRSs, Interpretations and amendments effective for annual

periods beginning on or after 1 March 2010

Amendments • to FRS 132, Financial Instruments:

Presentation - Classification of Rights Issues


periods beginning on or after 1 July 2010

FRS 1, First-time • Adoption of Financial Reporting

Standards (revised)

FRS 3, Business Combinations (revised)•

FRS 127, Consolidated and Separate Financial Statements •

(revised)

Amendments to FRS 2, Share-based Payment•

Amendments to FRS 5, Non-current Assets Held for •

Sale and Discontinued Operations

Amendments to FRS 138, Intangible Assets•

IC Interpretation 12, Service Concession Agreements•

IC Interpretation 15, Agreements for the Construction •

of Real Estate

IC Interpretation 16, Hedges of a Net Investment in a •

Foreign Operation

IC Interpretation 17, Distribution of Non-cash Assets •

to Owners

Amendments to IC Interpretation 9, Reassessment of •

Embedded Derivatives




periods beginning on or after 1 January 2011

Amendments to FRS 1, First-time Adoption of Financial •

Reporting Standards- Limited Exemption from

Comparative FRS 7 Disclosures for First-time Adopters

Amendments to FRS 7, Financial Instruments: Disclosures- •

Improving Disclosures about Financial Instruments

The Group and Company plans to apply the abovementioned

standards, amendments and interpretations:

fro• m the annual period beginning 1 January 2010 for those

standards, amendments or interpretations that will be

effective for annual periods beginning on or after 1 January

2010, except for FRS 4, 123 and IC interpretation 9, 11,

13 and 14 which are not applicable to the Group and

Company; and

from the annual period beginning 1 January 2011 for •

those standards, amendments or interpretations that will

be effective for annual periods beginning on or after 1

March 2010, 1 July 2010 and 1 January 2011 except for

Amendments to FRS 5, IC Interpretations 12,15,16 and

17 and Amendments to IC interpretation 9 which are

not applicable to the Group and Company.

The initial application of a standard, an amendment or an

interpretation, which will be applied prospectively, is not

expected to have any financial impacts to the current and

prior periods financial statements upon their first adoption.

The impacts and disclosures as required by FRS 108.30(b),

Accounting Policies, changes in Accounting Estimates and Errors,

in respect of applying FRS 7 and FRS 139 are not disclosed by

vir tue of the exemptions given in these respective FRSs.

Material impact of initial application of a standard, an

amendment or an interpretation, which will be applied

retrospectively, is disclosed below:

FRS 117, Leases

The amendments clarify that the classification of lease of

land and require entities with existing leases of land and

buildings to reassess the classification of land as finance

or operating lease. Leasehold land which in substance is

a finance lease will be reclassified to property, plant and

equipment. The adoption of these amendments will result

in a change in accounting policy which will be applied

retrospectively in accordance with the transitional

provisions. This change in accounting policy will result

in reclassification of lease of land for the Group and

Company from prepaid lease payments to property, plant

and equipment.

(b) Basis of measurement

The financial statements have been prepared on the

historical cost basis except as disclosed in the notes to

the financial statements.

(c) Functional and presentation currency

These financial statements are presented in Ringgit

Malaysia (“RM”), which is the Company’s functional



currency. All financial information presented in RM

has been rounded to the nearest thousand, unless

otherwise stated.

(d) Use of estimates and judgements

The preparation of financial statements in conformity

with FRSs requires management to make judgements,

estimates and assumptions that affect the application of

accounting policies and the reported amounts of assets,

liabilities, income and expenses. Actual results may differ

from these estimates.

Estimates and underlying assumptions are reviewed on

an ongoing basis. Revisions to accounting estimates are

recognised in the period in which the estimate is revised

and in any future periods affected.

There are no significant areas of estimation uncertainty

and critical judgements in applying accounting policies

that have significant effect on the amounts recognised

in the financial statements other than those disclosed in

the following notes:

Note 5measurement of the recoverableamounts of cash-generating units

Note 7 valuation of investment properties

Note 16recognition of unutilised tax losses and capital allowances

2. SIGNIFICANT ACCOUNTING POLICIES

The accounting policies set out below have been applied

consistently to the periods presented in these financial

statements, and have been applied consistently by Group

entities, except for the early adoption of FRS 8, Operating

Segments as disclosed in Note 2 (s).

(a) Basis of consolidation

(i) Subsidiaries

Subsidiaries are entities, including unincorporated

entities, controlled by the Group. Control exists when

the Group has ability to exercise its power to govern

the financial and operating policies of an entity so as to

obtain benefits from its activities. In assessing control,

potential voting rights that presently are exercisable

are taken into account. Subsidiaries are consolidated

using the purchase method of accounting.

Under the purchase method of accounting, the

financial statements of subsidiaries are included in the

consolidated financial statements from the date that

control commences until the date that control ceases.

Investments in subsidiaries are stated in the Company’s

balance sheet at cost less any impairment losses, unless

the investment is classified as held for sale (or included

in a disposal group that is classified as held for sale).



(ii) Associates

Associates are entities, including unincorporated entities,

in which the Group has significant influence, but not

control, over the financial and operating policies.

Associates are accounted for in the consolidated

financial statements using the equity method unless it

is classified as held for sale (or included in a disposal

group that is classified as held for sale). The consolidated

financial statements include the Group’s share of the

profit or loss of the equity accounted associates, after

adjustments, if any, to align the accounting policies

with those of the Group, from the date that significant

influence commences until the date that significant

influence ceases.

When the Group’s share of losses exceeds its interest

in an equity accounted associate, the carrying amount

of that interest (including any long-term investments)

is reduced to nil and the recognition of fur ther losses

is discontinued except to the extent that the Group

has an obligation or has made payments on behalf of

the investee.

Investments in associates are stated in the Company’s

balance sheet at cost less any impairment losses, unless

the investment is classified as held for sale (or included

in a disposal group that is classified as held for sale).

(iii) Changes in Group composition

Where a subsidiary issues new equity shares to

minority interests for cash consideration and the issue

price has been established at fair value, the reduction in

the Group’s interests in the subsidiary is accounted for

as a disposal of equity interest with the corresponding

gain or loss recognised in the income statements.

When a group purchases a subsidiary’s equity shares

from minority interests for cash consideration and the

purchase price has been established at fair value, the

accretion of the Group’s interests in the subsidiary

is accounted for as a purchase of equity interest for

which the acquisition method of accounting is applied.

The Group treats all other changes in group

composition as equity transactions between the

Group and its minority shareholders. Any difference

between the Group’s share of net assets before and

after the change, and any consideration received or

paid, is adjusted to or against Group reserves.

(iv) Minority interest

Minority interest at the balance sheet date, being the

portion of the net identifiable assets of subsidiaries

attributable to equity interests that are not owned by

the Company, whether directly or indirectly through

subsidiaries, are presented in the consolidated balance

sheet and statement of changes in equity within equity,

separately from equity attributable to the equity holders

of the Company. Minority interest in the results of the

Group are presented on the face of the consolidated

income statement as an allocation of the total profit



or loss for the year between minority interest and the

equity holders of the Company.

Where losses applicable to the minority exceed the

minority’s interest in the equity of the subsidiary, the

excess, and any fur ther losses applicable to the minority,

are charged against the Group’s interest except to the

extent that the minority has a binding obligation to,

and is able to, make additional investment to cover the

loses. If the subsidiary subsequently reports profits, the

Group’s interest is allocated with all such profits until

the minority’s share of losses previously absorbed by

the Group has been recovered.

(v)Transactions eliminated on consolidation

Intra-group balances and transactions, and any

unrealised income and expenses arising from intra-

group transactions, are eliminated in preparing the

consolidated financial statements.

Unrealised gains arising from transactions with equity

accounted investees are eliminated against the

investment to the extent of the Group’s interest in the

investee. Unrealised losses are eliminated in the same

way as unrealised gains, but only to the extent that

there is no evidence of impairment.

(b) Foreign currency

Foreign currency transactionsTransactions in foreign currencies are translated to the

respective functional currencies of the Group entities at

exchange rates at the dates of the transactions.

Monetary assets and liabilities denominated in foreign

currencies at the balance sheet date are retranslated

to the functional currency at the exchange rate at that

date. Non-monetary assets and liabilities denominated

in foreign currencies are translated at exchange rates

at the dates of the transactions except for those

transactions that are measured at fair value, which are

retranslated to the functional currency at the exchange

rate at the date that the fair value was determined.

Foreign currency differences arising on retranslation are

recognised in the income statements.

(c) Property, plant and equipment

(i) Recognition and measurement

Freehold land and capital work-in-progress are stated

at cost. All other property, plant and equipment are

stated at cost less accumulated depreciation and any

accumulated impairment losses.



Cost includes expenditures that are directly

attributable to the acquisition of the asset and any

other costs directly attributable to bringing the asset

to working condition for its intended use, and the costs

of dismantling and removing the items and restoring

the site on which they are located. The cost of self-

constructed assets also includes the cost of materials

and direct labour and, for qualifying assets, borrowing

costs are capitalised in accordance with the Group’s

accounting policy. Purchased software that is integral to

the functionality of the related equipment is capitalised

as part of that equipment.

The cost of property, plant and equipment recognised

as a result of a business combination is based on fair

value at acquisition date. The fair value of property is

the estimated amount for which a property could be

exchanged between a willing buyer and a willing seller

in an arm’s length transaction after proper marketing

wherein the parties had each acted knowledgeably,

prudently and without compulsion. The fair value of

other items of plant and equipment is based on the

quoted market prices for similar items.

When significant parts of an item of property, plant

and equipment have different useful lives, they are

accounted for as separate items (major components)

of property, plant and equipment.

Gains and losses on disposal of an item of property,

plant and equipment are determined by comparing the

proceeds from disposal with the carrying amount of

property, plant and equipment and are recognised net

within “other income” or “other operating expenses”

respectively in the income statements.

(ii) Subsequent costs

The cost of replacing part of an item of property, plant

and equipment is recognised in the carrying amount of

the item if it is probable that the future economic benefits

embodied within the part will flow to the Group and its

cost can be measured reliably. The carrying amount of

the replaced part is derecognised. The costs of the day-

to-day servicing of property, plant and equipment are

recognised in the income statement as incurred.

(iii) Depreciation

Depreciation is recognised in the income statement on

a straight-line basis over the estimated useful lives of

each part of an item of property, plant and equipment.

Leased assets are depreciated over the shorter of the

lease term and their useful lives unless it is reasonably

certain that the Group will obtain ownership by the

end of the lease term. Freehold land and capital work-

in-progress are not depreciated. Property, plant and

equipment under construction are not depreciated

until the assets are ready for their intended use.



(d) Operating lease

Leases where the Group or the Company does not assume

substantially all the risks and rewards of the ownership

are classified as operating leases and, except for property

interest held under operating lease, the leased assets are

not recognised on the Group’s balance sheet. Property

interest held under an operating lease, which is held to

earn rental income or for capital appreciation or both, is

classified as investment property.

Leasehold land that normally has an indefinite economic

life and title is not expected to pass to the lessee by the

end of the lease term is treated as an operating lease.

Payment made on entering into or acquiring a leasehold

land is accounted for as prepaid lease payments, except

for leasehold land classified as investment property.

Payments made under operating leases are recognised

in the income statements on a straight-line basis over

the term of the lease. Lease incentives received are

recognised as an integral part of the total lease expense,

over the term of the lease.

(iii)Depreciation (continued)

The estimated useful lives for the current and comparative periods are as follows:

Buildings 50 years

Building improvements and office renovations 2 - 10 years

Plant and machinery 10 - 20 years

Motor vehicles 5 years

Furniture and fittings, office and computer equipment 3 - 10 years

Depreciation methods, useful lives and residual values are reassessed at the balance sheet date.



(e) Hire purchase liabilities

Motor vehicles acquired under hire purchase arrangement

are capitalised at their purchase cost and depreciated

on the same basis as owned assets. The corresponding

obligations relating to the remaining capital payments

are treated as a liability. The interest element of the hire

purchase agreements is amortised over the period of the

agreements on the sum of digits method.

(f) Other investments - debt and equity securities

Investments in debt and equity securities are recognised

initially at fair value plus attributable transaction costs.

Subsequent to initial recognition:

Investments in non-current equity securities other •

than investments in subsidiaries and associates, are

stated at cost less allowance for diminution in value,

Investments in non-current debt securities are •

stated at amortised cost using the effective interest

method less allowance for diminution in value,

All current investments are carried at the lower of •

cost and market value, determined on an aggregate

portfolio basis by category of investments

Long term investment in subsidiaries and associates are

stated at cost in the Company, less any accumulated

impairment losses.

Where in the opinion of the Directors, there is a decline

other than temporary in the value of non-current equity

securities and non-current debt securities other than

investment in subsidiaries and associates, the allowance

for diminution in value is recognised as an expense in the

financial year in which the decline is identified.

On disposal of an investment, the difference between net

disposal proceeds and its carrying amount is recognised

in the income statement.

All investments in debt and equity securities are accounted

for using settlement date accounting. Settlement date

accounting refers to:

the recognition of an asset on the day it is received a.

by the entity, and

the de-recognition on an asset and recognition of any b.

gain or loss on disposal on the date it is delivered.

(g) Investment properties

Investment properties are properties which are owned

or held under a leasehold interest to earn rental income

or for capital appreciation or for both. These include land

held for a currently undetermined future use. Properties

that are occupied by the companies in the Group

are accounted for as owner-occupied rather than as

investment properties. Investment properties are stated

at fair value and gains and losses are recognised in the

profit and loss in the year which they arise.



The fair values of the investment properties determined

by Jabatan Penilaian dan Perkhidmatan Harta (“JPPH”) are

based on market values, being the estimated amount for

which a property could be exchanged on the date of the

valuation between a willing buyer and a willing seller in an

arm’s length transaction after proper marketing wherein

the parties had each acted knowledgeably, prudently and

without compulsion.

Valuations reflect, where appropriate, the type of

tenants actually in occupation or responsible for meeting

lease commitments or likely to be in occupation after

letting vacant accommodation, and the market’s general

perception of their creditworthiness; the allocation of

maintenance and insurance responsibilities between the

Group and the lessee; and the remaining economic life

of the property. When rent reviews or lease renewals

are pending with anticipated reversionary increases,

it is assumed that all notices and where appropriate

counter-notices have been served validly and within the

appropriate time.

(h) Intangible asset

Goodwill arises on business combination is measured at

cost less any accumulated impairment losses. Goodwill

represents the excess of the cost of the acquisition over

the Group’s interest in the fair value of the identifiable

assets, liabilities and contingent liabilities of the acquiree.

Any excess of the Group’s interest in the net fair value

of acquiree’s identifiable assets, liabilities and contingent

liabilities over the cost of acquisition is recognised

immediately in profit or loss.

Goodwill is not amortised but is tested for impairment

at each balance sheet date and whenever there is an

indication that goodwill may be impaired.

(i) Inventories

Inventories are measured at the lower of cost and net

realisable value. Net realisable value is the estimated

selling price in the ordinary course of business, less the

estimated costs of completion and the estimated costs

necessary to make the sale.

Inventories comprise mainly uniforms for postmen,

insertion and mailing materials, digital certificates and Pos

2020 merchandise. The cost of inventories is determined

on a weighted average basis.

Expenditure on the production of postage stamps is

expensed off in the financial year in which it is incurred

and therefore no value for stamps on hand at balance

sheet date is shown in the financial statements. However,

for internal control purposes, inventories of postage

stamps are accounted for at face value within a dedicated

accounting sub-system.



(j) Receivables

Receivables are initially recognised at their cost when

the contractual right to receive cash or another financial

asset from another entity is established.

Subsequent to initial recognition, receivables are stated

at cost less allowance for doubtful debts.

Receivables are not held for the purpose of trading.

(k) Cash and cash equivalents

Cash and cash equivalents consist of cash on hand,

balances and deposits with banks and highly liquid

investments which have an insignificant risk of changes

in value.

For the purpose of the cash flow statements, cash and

cash equivalents are presented net of cash held for the

purpose of distribution of fuel rebate for the government

and collections on behalf of agency creditors.

(l) Impairment of assets

The carrying amount of assets, except for inventories,

deferred tax assets and financial assets, are reviewed at

each reporting date to determine whether there is any

indication of impairment. If any such indication exists, the

asset’s recoverable amount is estimated. For goodwill, the

recoverable amount is estimated at each balance sheet

date and whenever there is an indication that goodwill

maybe impaired.

The recoverable amount of an asset or cash-generating

unit is the greater of its value in use and its fair value

less costs to sell. In assessing value in use, the estimated

future cash flows are discounted to their present value

using a pre-tax discount rate that reflects current market

assessments of the time value of money and the risks

specific to the asset. For the purpose of impairment testing,

assets are grouped together into the smallest group of

assets that generates cash inflows from continuing use

that are largely independent of the cash inflows of other

assets or groups of assets (the “cash-generating unit”).

The goodwill acquired in a business combination, for

the purpose of impairment testing, is allocated to cash-

generating units that are expected to benefit from the

synergies of the combination.

An impairment loss is recognised if the carrying

amount of an asset or its cash-generating unit exceeds

its recoverable amount unless the asset is carried at a

revalued amount, in which case the impairment loss is

recognised directly against any revaluation surplus for

the asset to the extent that the impairment loss does

not exceed the amount in the revaluation surplus for

that same asset. Impairment losses are recognised in

the income statements. Impairment losses recognised in

respect of cash-generating units are allocated first to reduce

the carrying amount of any goodwill allocated to the units

and then to reduce the carrying amount of the other assets

in the unit (groups of units) on a pro rata basis.



An impairment loss in respect of goodwill is not reversed.

In respect of other assets, impairment losses recognised

in prior periods are assessed at each reporting date

for any indications that the loss has decreased or no

longer exists. An impairment loss is reversed if there

has been a change in the estimates used to determine

the recoverable amount. An impairment loss is reversed

only to the extent that the asset’s carrying amount

does not exceed the carrying amount that would have

been determined, net of depreciation or amortisation,

if no impairment loss had been recognised. Reversals of

impairment losses are credited to the income statement

in the year in which the reversals are recognised.

(m) Equity instruments

All equity instruments are stated at cost on initial

recognition and are not re-assessed subsequently.

(i) Issue expenses

Incremental costs directly attributable to issue of equity

instruments are recognised as a deduction from equity.

(ii) Preference share capital

Preference share capital is classified as equity if

it is non-redeemable, or is redeemable but only

at the Company’s option, and any dividends are

discretionary. Dividends thereon are recognised as

distributions within equity. Preference share capital

is classified as a liability if it is redeemable on a

specific date or at the option of the shareholders, or

if dividend payments are not discretionary. Dividends

thereon are recognised as interest expense in the

income statements.

(n) Payables

Payables are measured initially and subsequently at cost.

Payables are recognised when there is a contractual

obligation to deliver cash or another financial asset to

another entity.

(o) Revenue recognition

Postal and its related services

Postage, prepaid mail and courier revenuePostage, prepaid mail and courier revenue on demand

are recognised in the income statement at point of sale.

No provision is made in the financial statements for any

unearned revenue as at balance sheet date in respect of

which the related postal service that has not yet been

provided as the amount is not material.

Courier revenue on contract is recognised upon

performance of the services.

Commission revenue on remittances and agency servicesCommission revenue on remittances and agency services

are recognised in the income statement upon the

performance of services.

International mail revenueRevenue from incoming international mail is recognised in the income statement upon performance of services.



Printing and insertion servicesRevenue is recognised upon provision of services, net of

sales taxes and discounts.

SaleofdigitalcertificatesRevenue from the sales of digital certificates is recognised

progressively over the life of the digital certificates that

can be used which ranges from twelve (12) to thir ty six

(36) months.

Other operating incomeInterest income:

Interest income is recognised as it accrues, using the

effective interest method.

Dividend income:

Dividend income is recognised when the right to receive

payment is established.

(p) Employee benefits

ShorttermemployeebenefitsShort-term employee benefit obligations in respect

of salaries, annual bonuses, paid annual leave and sick

leave are measured on an undiscounted basis and are

expensed as the related service is provided.

A provision is recognised for the amount expected to

be paid under short-term cash bonus or profit-sharing

plans if the Group has a present legal or constructive

obligation to pay this amount as a result of past service

provided by the employee and the obligation can be

estimated reliably.

The Group’s contribution to the Employees’ Provident

Fund are charged to the income statements in the year

to which they relate. Once the contributions have been

paid, the Group has no further payment obligations.

(q) Tax expense

Tax expense comprises current and deferred tax. Tax

expense is recognised in the income statements except

to the extent that it relates to items recognised directly

in equity, in which case it is recognised in equity.

Current tax is the expected tax payable on the

taxable income for the year, using tax rates enacted or

substantively enacted at the balance sheet date, and any

adjustment to tax payable in respect of previous years.

Deferred tax is recognised using the balance sheet

method, providing for temporary differences between

the carrying amounts of assets and liabilities for reporting

purposes and the amounts used for taxation purposes.

Deferred tax is not recognised for the following

temporary differences: the initial recognition of goodwill,

the initial recognition of assets or liabilities in a transaction

that is not a business combination and that affects neither

accounting nor taxable profit (tax loss). Deferred tax is

measured at the tax rates that are expected to be applied

to the temporary differences when they reverse, based on

the laws that have been enacted or substantively enacted

by the balance sheet date.



Deferred tax liability is recognised for all taxable

temporary differences.

A deferred tax asset is recognised to the extent

that it is probable that future taxable profits will be

available against which temporary difference can be

utilised. Deferred tax assets are reviewed at each

repor ting date and are reduced to the extent that it

is no longer probable that the related tax benefit will

be realised.

(r) Earnings per share

The Group presents basic earnings per share (“EPS”) data

for its ordinary shares. Basic EPS is calculated by dividing

the profit or loss attributable to ordinary shareholders

of the Company by the weighted average number of

ordinary shares outstanding during the period.

(s) Operating Segments

In the previous years, a segment was a distinguishable

component of the Group that was engaged either in

providing products or services (business segment), or

in providing products or services within a par ticular

economic environment (geographical segment), which

was subject to risks and rewards that were different

from those of other segments.

Following the early adoption of FRS 8, Operating

Segments, an operating segment is a component of the

Group that engages in business activities from which

it may earn revenues and incur expenses, including

revenues and expenses that relate to transactions with

any of the Group’s other components. An operating

segment’s operating results are reviewed regularly by

the chief operating decision maker, which in this case

is the Managing Director, Chief Executive Officer of

the Group, to make decision about resources to be

allocated to the segments and assess its performance

and for which discrete financial information is available.



3. VESTING OF BUSINESS

On 1 January 1992, all proper ty, rights and liabilities, other

than land and buildings and cer tain assets, to which Jabatan

Perkhidmatan Pos Malaysia (“JPPM”) was entitled or subject

to immediately before that vesting date, became the

proper ty, rights and liabilities of the Company by vir tue of

Section 3 of the Postal Services (Successor Company) Act

1991. The value of assets and the amount of liabilities of

JPPM transferred to and vested in the Company were those

stated in the financial statements of JPPM as at 31 December

1991. In accordance with Section 7(4) of the said Act, for

the purposes of any statutory financial statements of the

Group and Company, the amount to be included in respect

of any item shall be determined as if anything done by JPPM

whether by way of acquiring, revaluing or disposing of any

assets or incurring, revaluing or discharging any liability, or

by carrying any amount to any provision of reserve, or

otherwise, had been done by the Company.



4. PROPERTY, PLANT AND EQUIPMENT

Freehold land Buildings

Building improvements

and RenovationsGroup

RM’000 RM’000 RM’000

Cost

At 1 January 2008 2,276 35,114 81,468

Additions - - 1,426

Disposals - - -

Reclassifications - - -

Reclassified from prepaid lease payments - - 284

Transfers - - 3,634

Transferred to prepaid lease payments - - -

Written off - - (33,916)

At 31 December 2008/ 1 January 2009 2,276 35,114 52,896

Additions - - 1,965

Disposals - - -

Transfers - - 33,583

Written off - - -

At 31 December 2009 2,276 35,114 88,444



Plant andmachinery

Motorvehicles

Furniture and fittings, office

and computer equipment

Capital work-in progress Total

RM’000 RM’000 RM’000 RM’000 RM’000

33,281 100,064 105,570 27,793 385,566

11 25,092 7,032 73,203 106,764

- (4,638) (428) - (5,066)

(724) - 724 - -

- - - - 284

1,041 18,072 22,169 (44,916) -

- - - (1,851) (1,851)

(14,836) (92) (8,377) - (57,221)

18,773 138,498 126,690 54,229 428,476

31 5,642 4,073 66,878 78,589

- (12,820) (1,093) - (13,913)

- 3,678 15,291 (52,552) -

- (5) - - (5)

18,804 134,993 144,961 68,555 493,147



4. PROPERTY, PLANT AND EQUIPMENT (continued)



and RenovationsGroup

RM’000 RM’000 RM’000

Depreciation

At January 2008 - 6,543 55,917

Depreciation for the year - 693 4,232

Disposals - - -

Reclassifications - - -

Reclassified from prepaid lease payments - - 59


At 31 December 2008/ 1 January 2009 - 7,236 26,292


Disposals - - -

Written off - - -

At 31 December 2009 - 7,929 30,708

Carrying amounts

At 1 January 2008 2,276 28,571 25,551


At 31 December 2009 2,276 27,185 57,736



Plant andmachinery

Motorvehicles




RM’000 RM’000 RM’000 RM’000 RM’000

27,925 75,165 63,140 - 228,690

672 11,306 12,195 - 29,098

- (4,648) (409) - (5,057)

(552) - 552 - -

- - - - 59

(14,836) (92) (8,371) - (57,215)

13,209 81,731 67,107 - 195,575

689 16,648 15,143 - 37,589

- (12,736) (970) - (13,706)

- (5) - - (5)

13,898 85,638 81,280 - 219,453

5,356 24,899 42,430 27,793 156,876

5,564 56,767 59,583 54,229 232,901

4,906 49,355 63,681 68,555 273,694






and RenovationsCompany

RM’000 RM’000 RM’000

Cost

At 1 January 2008 2,276 25,718 76,993

Additions - - 421

Disposals - - -

Transfers - - 3,634

Transferred to prepaid lease payments - - -



Additions - - 1,541

Disposals - - -

Transfers - - 33,583

At 31 December 2009 2,276 25,718 82,256



Plant andmachinery

Motorvehicles




RM’000 RM’000 RM’000 RM’000 RM’000

20,035 99,130 89,131 27,464 340,747

11 25,016 5,032 72,280 102,760

- (4,505) (428) - (4,933)

1,041 18,072 22,169 (44,916) -

- - - (1,800) (1,800)

(14,836) - (7,795) - (56,547)

6,251 137,713 108,109 53,028 380,227

25 5,642 3,773 67,992 78,973

- (12,820) (1,093) - (13,913)

- 3,678 15,132 (52,393) -

6,276 134,213 125,921 68,627 445,287






and RenovationsCompany

RM’000 RM’000 RM’000

Depreciation

At 1 January 2008 - 4,732 54,365


Disposals - - -


At 31 December 2008/ 1 January 2009 - 5,236 24,312


Disposals - - -

At 31 December 2009 - 5,740 28,387

Carrying amounts

At 1 January 2008 2,276 20,986 22,628


At 31 December 2009 2,276 19,978 53,869

The Group and Company obtained Financing on motor vehicles amounting to RM34,583000 (2008- RM41,466,000) and

RM34,529,000 (2008- RM41,391,000) under hire purchase arrangements.

The title deeds for certain freehold land with carrying value amounting to RM842,000 (2008- RM846,000) have yet to be issued

in the name of the Company as at 31 December 2009 by the relevant authorities.

The cost of fully depreciated assets which are still in use by the Group and Company is RM100,144,000 (2008- RM103,805,000)

and RM80,555,000 (2008- RM84,835,000) respectively.



Plant andmachinery

Motorvehicles




RM’000 RM’000 RM’000 RM’000 RM’000

17,336 74,369 50,228 - 201,030

526 11,256 10,815 - 26,964

- (4,503) (402) - (4,905)

(14,836) - (7,789) - (56,541)

3,026 81,122 52,852 - 166,548

542 16,604 13,721 - 35,446

- (12,736) (970) - (13,706)

3,568 84,990 65,603 - 188,288

2,699 24,761 38,903 27,464 139,717

3,225 56,591 55,257 53,028 213,679

2,708 49,223 60,318 68,627 256,999



5. INTANGIBLE ASSET

Group Goodwill

RM’000

Cost

At 1 January 2008 -

Acquisitions of minority interests 4,630

As at 1 January 2009/ 31 December 2009 4,630

Amortisation and impairment losses

As at 1 January 2009/ 31 December 2009 -

Carrying amount

At 31 December 2007/ 1 January 2008 -

At 31 December 2009 4,630

Impairment testing for goodwill

For the purpose of impairment testing, goodwill is allocated to the subsidiary acquired which represents the lowest level within

the Group at which the goodwill is monitored for internal management purposes.

The Goodwill impairment test was based on value in use and was determined by the Management.

Value in use was determined by discounting future cash flows generated from the continuing use of the subsidiary and was based

on the following key assumptions:

Cash• flows were projected based on actual Earnings before Interest, Tax, Depreciation and Amortisation (“EBITDA”) and a 5 year business plan.EBITDA for 2010 – 2014 was projected based on actual EBITDA for 2009. The anticipated annual growth rate was 5% per • annum for the years 2010 – 2014. A pre-tax discount rate of 7.5% was applied in determining the recoverable amount of the subsidiary. This discount rate was • estimated based on the Group’s weighted average cost of capital.

The values assigned to the key assumptions represent management’s assessment of future trends in the Group and subsidiary’s principal activities and are based on internal sources.



6. PREPAID LEASE PAYMENTS

Group

Leasehold landand buildings

Government leasehold landand buildings Total

RM’000 RM’000 RM’000

Cost

At 1 January 2008 184,106 210,799 394,905

Transfered from capital work-in-progress 1,851 - 1,851

Reclassified to property, plant and equipment (284) - (284)


Written off (206) - (206)

At 31 December 2009 185,467 210,799 396,266

Amortisation

At 1 January 2008 29,278 82,177 111,455

Amortisation during the year 2,230 9,139 11,369

Reclassified to property, plant and equipment (59) - (59)



At 31 December 2009 33,471 100,660 134,131

Carrying amounts

At 1 January 2008 154,828 128,622 283,450


At 31 December 2009 151,996 110,139 262,135



6. PREPAID LEASE PAYMENTS (continued)

Company

Leasehold landand buildings

Government leasehold landand buildings Total

RM’000 RM’000 RM’000

Cost

At 1 January 2008 99,585 210,799 310,384

Transfered from capital work-in-progress 1,800 - 1,800

At 31 December 2008/ 1 January 2009/ 31 December 2009 101,385 210,799 312,184

Amortisation

At 1 January 2008 24,986 82,814 107,800




At 31 December 2009 28,110 101,660 129,770

Carrying amounts

At 1 January 2008 74,599 127,985 202,584


At 31 December 2009 73,275 109,139 182,414



6. PREPAID LEASE PAYMENTS (continued)

The cost and carrying value of certain leasehold land and government leasehold land is not segregated from the cost and a.

carrying value of the buildings as the required information are not available from the sales and purchase agreements.

Similarly, information on unexpired lease period of less than fifty (50) years and of more than fifty (50) years is not available.

The title deeds for certain landed properties with net carrying value amounting to RM9,379,000 (2008 - RM9,610,000) have b.

yet to be issued in the name of the Company as at 31 December 2009 by the relevant authorities.

Government leasehold land and buildings:c.

Government leasehold land and buildings of RM210,799,000 (2008 - RM210,799,000) are for a lease period of sixty i.

(60) years commencing from 1 January 1992, the vesting date as stated in Note 3 to the financial statements.The cost

capitalised is in respect of the lease for the first thir ty (30) years period as stipulated in the agreement signed between

the Company and the Government. The cost in respect of the remaining thir ty (30) years lease period has not been

agreed. However, this cost will be agreed upon finalisation of the agreement with the authorities, no later than 31

December 2020, and thereafter will be recognised accordingly.

The Company is also in the process of finalising lease agreements with the authorities for additional Government ii.

leasehold land and buildings currently used by the Company, which are at present carried at nil values in the financial

statements in the absence of Government valuation for these properties. These Government leasehold land and buildings

will be recognised in the financial statements upon the valuations being finalised by the authorities.



7. INVESTMENT PROPERTIES

Group

2009RM’000

2008RM’000

Group

At 1 January & 31 December 15,071 15,071

Included in the above are:

Freehold Land 3,311 3,311

Leasehold land 11,760 11,760

15,071 15,071

The carrying amount of investment properties at the balance sheet date approximated their fair values.

8. INVESTMENTS IN SUBSIDIARIES

Company

2009RM’000

2008RM’000

Unquoted shares, at cost 43,990 35,490

Less Accumulated Impairment losses (2,706) (2,706)

41,284 32,784



8. INVESTMENT IN SUBSIDIARIES (continued)

Details of the subsidiaries are as follows:

Name of subsidiary

Country of

incorporation Principal activities

Effective

ownership interest

2009(%) 2008(%)

Datapos (M) Sdn. Bhd. MalaysiaPrinting and insertion of documents for mailing

100 100

Digicert Sdn. Bhd. Malaysia Sale of digital certificates 100 55

Pos Takaful Agency Sdn. Bhd. Malaysia Dormant 100 100

Poslaju (M) Sdn. Bhd. Malaysia Dormant 100 100

Pos Logistics-Fulserve Sdn. Bhd. ** Malaysia Dormant 100 100

Vir tual Pos Sdn. Bhd. ** Malaysia Dormant 100 100

Philately Pos Malaysia Sdn. Bhd. ** Malaysia Dormant 100 100

Pos Malaysia & Services Holdings Berhad Malaysia Investment holding 100 100

PSH Capital Partners Sdn. Bhd. Malaysia Investment holding 100 100

PSH Venture Capital Sdn. Bhd. Malaysia Investment holding 100 100

PSH Management Sdn. Bhd. ** Malaysia Dormant 100 100

PSH Properties Sdn. Bhd. Malaysia Property investment 100 100

PSH Merchandise Sdn. Bhd. ** Malaysia Dormant 100 100

PSH Allied Berhad Malaysia Dormant 100 100

PMB Properties Sdn. Bhd. Malaysia Property investment 100 100

Held by PSH Capital Partners Sdn. Bhd.

Prestige Future Sdn. Bhd. Malaysia Dormant 100 100

Held by PSH Properties Sdn. Bhd.

Real Riviera Sdn. Bhd. Malaysia Property investment 100 100

Effivation Sdn. Bhd. Malaysia Property investment 100 100



8. INVESTMENT IN SUBSIDIARIES (continued)

Name of subsidiary

Country of

incorporation Principal activities

Effective

ownership interest

2009(%) 2008(%)

Held by PSH Venture Capital Sdn. Bhd.

PSH Express Sdn. Bhd. Malaysia Air courier services & fulfilment business 100 100

Held by Pos Malaysia & Services Holdings Berhad

PSH Investment Holding (BVI) Ltd.* British Virgin Islands Dormant 100 100

* The investment in PSH Investment Holding (BVI) Ltd. has been consolidated based on the management financial statements

for the financial year ended 31 December 2009 as a statutory audit is not required in the British Virgin Islands.

** In the process of striking-off from the register of the Companies Commission of Malaysia

(a) During the year, the Company entered into a Share Sale Agreement with MIMOS Berhad to acquire 4,050,000 ordinary shares

of RM1.00 each in Digicert Sdn Bhd (“Digicert”) representing 45% of the issued and paid-up share capital of Digicert for a cash

consideration of RM8,500,000. Subsequently, Digicert became a wholly owned subsidiary of the Company.



9. INVESTMENT IN ASSOCIATES

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

Unquoted shares, at cost 7,650 7,650 7,650 7,650

Less: Impairment losses (7,650) (7,650) (7,650) (7,650)

The Group discontinued equity accounting of loss in associates as the loss already exceeded the carrying amount of the

investment. As at 31 December 2009, the share of loss profits in those associates for the financial year and share of loss

cumulatively not accounted for was a profit of RM1,870,000 (2008 - a loss of RM4,839,000) and RM37,950,000 (2008 -

RM39,820,000) respectively.

GroupCountry of

incorporation

Effective Ownership

InterestRevenue(100%)

Profit /(Loss)(100%)

Total assets(100%)

Total liabilities(100%)

2009 RM’000 RM’000 RM’000 RM’000

Elpos Print Sdn. Bhd Malaysia 40.0 10,095 37 7,896 12,387

CEN Sdn. Bhd Malaysia 42.5 21,727 4,371 13,794 67,178

Pospay Exchange Sdn. Bhd Malaysia 50.0 - (7) 2,780 3,292

31,822 4,401 24,470 82,857

2008

Elpos Print Sdn. Bhd Malaysia 40.0 11,745 888 8,578 13,106

CEN Sdn. Bhd Malaysia 42.5 69,159 (12,292) 22,969 80,714

Pospay Exchange Sdn. Bhd Malaysia 50.0 25 (1,407) 2,781 5,443

80,929 (12,811) 34,328 99,263



10. OTHER INVESTMENTS

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

Non-current

Quoted shares in Malaysia, at cost 249,562 249,562 357,343 357,343

Less: Dimunition in value (227,703) (227,703) (335,484) (335,484)

21,859 21,859 21,859 21,859

Unquoted private debt securities 190,068 190,068 190,068 190,068

Less: Amortisation of premium (3,435) (2,874) (1,273) (712)

186,633 187,194 188,795 189,356

Unquoted shares in Malaysia, at cost 2,000 12,898 - -

Less: Diminution in value (2,000) (2,000) - -

- 10,898 - -

208,492 219,951 210,654 211,215

Market value:

Quoted shares in Malaysia 35,420 21,859 35,420 21,859

Unquoted private debt securities 186,670 187,857 186,670 187,857

Current

Quoted shares in Malaysia, at cost 19,647 24,543 19,647 24,543

Less: Written down to market value (14,680) (16,900) (14,680) (16,900)

4,967 7,643 4,967 7,643

Market value:

Quoted shares in Malaysia 4,967 7,643 4,967 7,643



10. OTHER INVESTMENTS (continued)

During the year, the Group disposed off its investments in unquoted shares for a cash consideration of RM13,500,000 (2008-Nil).

During the year, the Group and Company disposed off quoted shares for a cash consideration of RM5,516,000 (2008- RM24,340,000).

Subsequent to year end, a quoted investee of the Group and Company, Transmile Group Berhad (“TGB”), of which the Group and Company has a direct investment of 15% shareholding, announced that it was considered a PN17 company.

The net carrying value of TGB recorded in the Group and Companys financial statements as at 31 December 2009 was RM21.9 million (based on the closing share price of TGB as at 31 December 2008 of RM0.54 per share). The closing share price as at 31 December 2009 was RM0.88 per share. The Board of Directors is of the opinion that the movement of share prices of TGB from 31 December 2008 to 31 December 2009 was temporary in nature.

As at 31 March 2010, the market value of TGB based on the closing share price on the same date was RM0.395 per share. The net tangible assets per share of TGB as at 31 December 2009 was RM0.08 per share.

Had the closing share price as at 31 March 2010 of TGB of RM0.395 per share been used to determine the fair value of the investment in the Group and Company’s financial statements as at 31 December 2009, an impairment amounting to RM5.9 million would have been provided for and the net profit of the Group and Company would have been reduced by the same amount.

On 26 March 2010, Transmile Air Services Sdn. Bhd. (“TAS”), the wholly owned subsidiary of TGB, was served with a Notice pursuant to Section 218(2)(a) of the Companies Act 1965 by Malaysian Trustee Berhad (“MTB”) in demanding the payment of the amounts owing by TAS pursuant to the Trust Deed dated 8 August 2003 entered between TAS and MTB.

There were no other material events subsequent to balance sheet date that have not been reflected in the financial statements.



11. INVENTORIES

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

At cost:

Postal uniforms and consumables 4,418 3,097 4,179 3,098

Pos 2020 merchandise 557 561 557 561

Insertion and mailing materials 1,638 1,003 - -

Digital certificates, CD ROM and smart cards 2,079 1,554 - -

8,692 6,215 4,736 3,659

During the financial year, inventories recognised as expenses in the income statement of the Group and of the Company amounted to RM28,516,000 (2008 - RM16,185,000) and RM20,005,000 (2008 - RM15,960,000) respectively.



12. RECEIVABLES, DEPOSITS AND PREPAYMENTS

Group Company

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Trade

Trade receivables 125,226 137,015 98,672 117,782

Less: Allowance for doubtful debts (12,593) (14,513) (12,024) (13,908)

a 112,633 122,502 86,648 103,874

Non-trade

Other receivables 55,469 57,364 6,380 5,801

Less: Allowance for doubtful debts (15,537) (18,451) - -

39,932 38,913 6,380 5,801

Amount due from a subsidiaries b - - 121,034 122,128

Amount due from associates b 80 80 80 80

Deposits 10,386 6,616 9,369 5,773

Investment income receivables 2,945 7,643 2,130 6,196

Staff advances 11,531 3,250 11,436 2,925

64,874 56,502 150,429 142,903

117,507 179,004 237,077 246,777



12. RECEIVABLES, DEPOSITS AND PREPAYMENTS (continued)

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

The currency exposure profile of trade and other receivables is as follows:

Ringgit Malaysia 165,142 163,906 224,712 231,679

US Dollar 12,365 15,098 12,365 15,098

177,507 179,004 237,077 246,777

a. Trade receivables

Credit terms of trade receivables other than international

mail receivables range from thir ty (30) days to sixty (60)

days. The credit terms for international mail receivables

range from six (6) months to eighteen (18) months in

accordance with the Universal Postal Union guidelines.

Concentration of credit risk with respect to trade

receivables are limited due to the Group’s large number

of customers whereby sufficient allowance has been

made for debts that are doubtful in collection. In addition,

the Group has adopted a credit evaluation policy for all

trade receivables. Due to these factors, management

believes that no additional credit risk beyond amounts

provided for collection losses is inherent in the Group’s

trade receivables.

b. Amount due from subsidiaries and associates

The amounts due from subsidiaries and associates

are unsecured, interest free and repayable on demand.



13. CASH AND CASH EQUIVALENTS

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

Deposits are placed with:

Licensed banks 117,904 487,654 112,000 483,000

Other financial institutions 80,738 21,100 76,638 17,000

198,642 508,754 188,638 500,000

Cash and bank balances 119,219 91,504 87,916 79,656

317,861 600,258 276,554 579,656

Included in deposits with licensed banks are cash held for the purpose of distribution of fuel rebate for the government

amounting to RM4,257,000 (2008– RM309,799,000) and collection on behalf of agencies amounting to RM131,827,000 (2008–

RM118,958,000).

Deposits, cash and bank balances are denominated in Ringgit Malaysia. The weighted average interest rates of deposits, cash and

bank balances that were effective as at balance sheet date were as follows:

Group and Company

2009 2008

% %

Deposits with licensed banks 1.95 3.16

Deposits with other financial institutions 1.70 3.00

Deposits of the Group and of the Company have maturity period ranging from 1 to 365 days (2008 - 1 to 365 days).



14. SHARE CAPITAL AND RESERVES

Group and Company

Amount Number of shares Amount No. of Shares

2009RM’000

2009’000

2008RM’000

2008’000

Authorised:

Ordinary shares of RM0.50 1,000,000 2,000,000 1,000,000 2,000,000

Special Rights Redeemable Preference shares of RM1 each * * * *

Issued and fully paid:

Ordinary shares of RM0.50 each

Balance at 1 January 268,513 537,026 268,369 536,738

Exercise of share option - - 144 288

Ordinary shares of RM0.50 each

Balance at 31 December 268,513 537,026 268,513 537,026

Special Rights Redeemable Preference shares of RM1 each * * * *

268,513 537,026 268,513 537,026

* Share capital includes the Special Rights Redeemable Preference Share of RM1.00.

(a) During the previous financial year, the issued and

paid up capital of the Company was increased from

RM268,369,042.50 to RM268,513,042.50 by the

issuance of 288,000 ordinary shares of RM 0.50 each by

the Company for cash by vir tue of the exercise of share

options pursuant to the Company’s Employee Share

Option Scheme (ESOS). Details of the ESOS exercised

are set out in Note 14 (c) below.



(b) The Special Rights Redeemable Preference Share confers

the following rights:

(i) The Special Rights Redeemable Preference Share

issued to the Government of Malaysia would enable

the Government of Malaysia through Minister of

Finance, (Incorporated) or its successors or any

Minister, representative or any person acting on behalf,

to ensure that certain major decisions affecting the

operation of the Company are consistent with the

Government’s policy. The Special Rights Redeemable

Preference shareholder is entitled to receive notices

of meetings but does not carry any right to vote at

such meetings of the Company. He also has the right

to require the Company to redeem the Special Rights

Redeemable Preference Share at par at any time.

(ii) Certain matters, in par ticular, the alteration of the

Ar ticles of Association of the Company relating

to the rights of the Special Rights Redeemable

Preference shareholder, the dissolution of the

Company, any substantial acquisitions and disposal

of assets, amalgamation, merger and takeover,

appointment of foreign directors, creation or issue

of any shares which when aggregated with all other

existing issued shares, carry ten percent of total

voting rights, require prior consent of the Special

Rights Redeemable Preference shareholder.

(iii) In a distribution of capital or a winding-up of the

Company, the Special Rights Redeemable Preference

shareholder is entitled to the repayment of the

capital paid-up on the Special Rights Redeemable

Preference Share in priority to any repayment of

capital to any other member. The Special Rights

Redeemable Preference Share does not confer

any right to par ticipate in the capital or profits of

the Company.

(c) Employees Share Option Scheme (“ESOS”)

The Company had on 31 October 2007 implemented

the ESOS upon the completion of the restructuring

exercise of Pos Malaysia & Services Holdings Berhad

(“PSH”) for the purpose of continuing the objectives

under the Pos Malaysia & Services Holdings Berhad’s

ESOS. The ESOS is governed by the ESOS Bye-laws

which were approved by the shareholders on 28

June 2007. The ESOS is in force for a period from 31

October 2007 up to 23 June 2008.

The main features of the ESOS are as follow:

(i) The maximum number of new shares of the Company

which may be made available under the ESOS shall

be 16.016 million shares, representing approximately

three per centum (3%) of the enlarged issued and

paid-up share capital of the Company after the PSH

restructuring exercise.



(ii) Subject to any adjustments, which may be made

under the Bye-laws, the number of the new shares of

the Company that may be offered, allotted and issued

to any of the eligible employees of the Group who

are entitled to participate in the ESOS shall be at the

discretion of the Option Committee after taking into

consideration the performance, seniority and length

of service of the eligible employees in the Group

subject to the following:

The number of the Company shares allocated, in •

aggregate, to the executive directors and senior

management of the Group shall not exceed 50%

of the total shares of the Company available under

the ESOS; and

The number of shares of the Company allocated •

to any individual executive director or employee

who, either singly or collectively through persons

connected with the employee, the executive

director (as defined in paragraph 6.30A(4)(b) of

the Listing Requirements) holds twenty per centum

(20%) or more in the issued and paid-up share

capital of the Company shall not exceed ten per

centum (10%) of the total shares of the Company

available under the ESOS.

(iii) Any eligible employee shall be eligible to participate

in the ESOS if, as at the Offer Date, such person is:

An employee or executive director, being a •

natural person who is a Malaysian citizen who

has attained the age of eighteen (18) years and

is employed full-time by and is on the payroll

of a company within the Group (other than a

company which is dormant) and who has been

confirmed and has been in the employment in the

Group for a continuous period of at least twelve

(12) months on a full time basis including service

during the probation period and is not prohibited

or disallowed by the relevant authorities from

participating in the ESOS.

(iv) The subscription price under the ESOS shall be

set at the weighted average market price of the

Company’s shares as shown in the Daily Official

List of the Bursa Malaysia Securities Berhad for

the five (5) Market Days immediately preceding

the Offer Date with an allowance for a discount of

not more than ten per centum (10%) therefrom

at the Option Committee’s discretion, (or such

other pricing mechanism as may be permitted by

the Bursa Malaysia Securities Berhad or any other

relevant regulatory authorities, from time to time)

provided that the subscription price shall in no event

be less than the par value of the Company’s share.



(v) The new shares of the Company to be allotted upon

any exercise of the option shall, upon allotment and

issue, rank pari passu in all respects with the existing

ordinary shares of the Company (including in respect

of voting, dividend, transfer and other rights and rights

arising on a liquidation of the Company) save and

except that the new shares of the Company will not

Details of options over the ordinary shares of the Company granted under the ESOS are as follows:

Grant date Expiry date Exercise PriceRM

Opening balance‘000

Allocated‘000

(Subscribed)‘000

(Lapsed)‘000

Closing balance‘000

3.6.2008 23.6.2008 2.03 - 525* (20.3) (504.7) -

3.6.2008 23.6.2008 1.83 - 1,590 (267.7) (1,322.3) -

* The amount has been granted in 2008 under the “Performance Share Scheme” and allocated/vested to the respective personnel

on 6 June 2008. The ESOS cost is not material to the results of the Group and Company.

rank for any dividends, rights, allotments and/or other

distributions declared for payment to the shareholders

of the Company appearing in its Register of Members

or Record of Depositors the entitlement date of

which precedes the date of allotment of the new

shares of the Company to be issued upon exercise

of the Option.

(d) Share premium reserves

This reserve comprises the premium paid on subscription of shares in the Company over and above the par value of the shares.

The movements in each category of the reserves are disclosed in the statements of changes in equity.



15. RETAINED EARNINGS

Subject to agreement by the Inland Revenue Board, the

Company has sufficient Section 108 tax credit and tax exempt

income to frank and distribute all of its distributable reserves

as at 31 December 2009 if paid out as dividends.

The Finance Act 2007 introduced a single tier company income

tax system with effect from year of assessment 2008. As such,

the remaining Section 108 tax credit as at 31 December 2009

16. DEFERRED TAX ASSETS AND LIABILITIES

Group Company

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Opening balance (10,279) (6,960) (10,203) (7,220)

Recognised in the income statement 22 247 (3,544) 563 (3,057)

(Under)/over provision in prior years 22 (4,386) 225 (4,017) 74

Closing balance (14,418) (10,279) (13,657) (10,203)

Presented after appropriate offsetting as follows:

Deferred tax assets 85 376 - -

Deferred tax liabilities (14,503) (10,655) (13,657) (10,203)

Balance at 31 December 2009 (14,418) (10,279) (13,657) (10,203)

will be available to the Company until such time the credit is

fully utilised or upon expiry of the six-year transitional period

on 31 December 2013, whichever is earlier.



Deferred tax assets and liabilities are attributable to the following:

Assets Liabilities Net

2009RM’000

2008RM’000

2009RM’000

2008RM’000

2009RM’000

2008RM’000

Group

Property, plant and equipment 1,657 1,247 (22,796) (18,800) (21,139) (17,553)

Provisions 6,721 7,274 - - 6,721 7,274

Net tax assets/ (liabilities) 8,378 8,521 (22,796) (18.,800) (14,418) (10,279)

Company

Property, plant and equipment 1,629 1,219 (21,237) (17,518) (19,608) (16,299)

Provisions 5,951 6,096 - - 5,951 6,096

Net tax assets/ (liabilities) 7,580 7,315 (21,237) (17,518) (13,657) (10,203)

16. DEFERRED TAX ASSETS AND LIABILITIES (continued)




The components and movements of deferred tax liabilities and assets during the financial year prior to offsetting are as follows:

Deferred tax (liabilities)/assets of the Group:

Property, Plant and Equipment

RM’000Provisions

RM’000Total

RM’000

At 1 January 2008 (8,450) 1,490 (6,960)

Recognised in the income statement (8,392) 4,848 (3,544)

(Under)/over provision in prior years (711) 936 225

At 31 December 2008/1 January 2009 (17,553) 7,274 (10,279)

Recognised in the income statement 483 (236) 247

(Under)/over provision in prior years (4,069) (317) (4,386)

At 31 December 2009 (21,139) 6,721 (14,418)

Deferred tax (liabilities)/assets of the Company:

Property, Plant and Equipment

RM’000Provisions

RM’000Total

RM’000

At 1 January 2008 (7,887) 667 (7,220)

Recognised in the income statement (8,080) 5,023 (3,057)

(Under)/over provision in prior years (332) 406 74

At 31 December 2008/1 January 2009 (16,299) 6,096 (10,203)

Recognised in the income statement 508 55 563

(Under) provision in prior years (3,817) (200) (4,017)

At 31 December 2009 (19,608) 5,951 (13,657)




No deferred tax has been recogised for the following items:

The deductible temporary differences do not expire under the

current tax legislation. Deferred tax assets were not recognised

in respect of these items because it was not probable that future

taxable profit will be available against which the Group can utilise

the benefits there from.

The unutilised tax losses and unabsorbed capital allowances

amounting to approximately RM96,828,000. (2008 –RM97,081,000)

and RM1,887,000 (2008- RM1,887,000) will not be available to

the Group if there is substantial change in shareholders (more

than 50%).

Group

2009RM’000

2008RM’000

Unutilised tax losses 96,828 97,081

Unabsorbed capital allowances 1,887 1,887

98,715 98,968



17. HIRE PURCHASE CREDITORS

Hire purchase creditors are payable as follows:

Minimumlease payment

2009RM’000

Interest2009

RM’000

Principal2009

RM’000

Minimumlease payment

2008RM’000

Interest2008

RM’000

Principal2008

RM’000

Group

Less than one year 9,812 1,416 8,396 8,402 1,498 6,904

Between one and five years 25,447 1,618 23,829 29,416 2,350 27,066

35,259 3,034 32,225 37,818 3,848 33,970

Company

Less than one year 9,798 1,415 8,383 8,386 1,495 6,891

Between one and five years 25,408 1,616 23,792 29,362 2,346 27,016

35,206 3,031 32,175 37,748 3,841 33,907

The Group and Company obtained financing on motor vehicles amounting to RM34,583,000 (2008- RM41,466,000) and

RM34,529,000 (2008- RM41,391,000) under hire purchase arrangement.



18. PAYABLES AND ACCRUALS

Group Company

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Trade

Trade payables a 35,437 40,486 34,107 37,757

Non-Trade

Amount due to subsidiaries b - - 24,434 28,508

Amount due to associates b 835 - 835 -

Other payables and accruals:

- Unpresented postal and money orders 86,905 71,990 86,906 71,990

- Agency payables c 136,084 428,757 136,084 428,757

- Money order payables 17,142 18,264 17,142 18,264

- Service payables 26,714 31,115 23,664 27,056

- Others 2,471 - - -

Other accruals 103,483 120,964 91,593 109,575

Advances from subsidiary corporate shareholder d - 2,486 - -

Deposits received 13,141 11,407 12,333 17,026

386,775 684,983 392,991 701,176

422,212 725,469 427,098 738,933



18. PAYABLES AND ACCRUALS (continued)

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

The currency exposure profile of trade and other payables is as follows:

Ringgit Malaysia 409,039 712,677 413,925 726,142

US Dollar 12,650 12,241 12,650 12,241

EURO 167 172 167 172

SGD 7 60 7 59

CHF 213 166 213 166

DKK 102 102 102 102

Others 34 51 34 51

422,212 725,469 427,098 738,933

a. Trade payables

Credit terms of international mail payables of the Group

and of the Company range from six (6) months to

eighteen (18) months (2008 – 6 months to 18 months) in

accordance with the Universal Postal Union guidelines.

b. Amount due to subsidiaries and associates

The amounts due to subsidiaries and associates

are unsecured, interest free and repayable on demand.

c. Agency payables

Included in agency payables is cash held for the purpose of

fuel distribution rebate for the government amounting to

RM4,257,000 (2008 –- RM309,799,000).

d. Advances from subsidiary’s corporate shareholder

The advances from a subsidiary’s corporate shareholder

were unsecured, interest free and repayable on demand.



19. REVENUE

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

Mail 576,850 580,405 560,009 561,686

Courier and logistic 175,389 171,666 173,243 168,901

Retail 138,968 143,583 138,968 143,584

Sale of digital certificates 10,533 25,120 - -

Rental income 821 892 - -

902,561 921,666 872,220 874,171



20. PROFIT/ (LOSS) BEFORE TAX

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

Profit/(loss) before tax is arrived at after charging:Staff cost (excluding key management personnel)

- salaries, bonuses and allowances 405,643 404,859 397,868 397,622

- defined contribution plan 63,247 64,186 62,136 63,307

- others 36,704 38,709 35,694 37,439

Auditors’ remuneration 315 315 210 210

Rental

- office and computer equipment 4,776 1,738 4,184 929

- land and buildings 15,322 13,876 15,341 14,068

- machinery 274 118 133 105

- motor vehicles 108 72 62 26

Property, plant and equipment written off - 6 - 6

Prepaid lease written off 206 - - -

Inventories written off - 18 - -

Allowance for doubtful debts

- trade receivables 3,079 3,421 3,079 3,490

- other receivables - 18,451 - -

Allowance for diminution in value - 87,032 - 87,032

Write down of quoted shares - 10,615 - 10,615

Operating licence fee 4,368 5,176 4,368 5,176

Loss on redemption of unquoted private debt securities - - - 329

Amortisation of premium 561 660 561 660



20. PROFIT/ (LOSS) BEFORE TAX (continued)

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

and after crediting:

Gain on disposal of property, plant and equipment 2,404 955 2,404 975

Dividend income (gross) 149 1,011 149 1,011

Inventories written back - 276 - 294

Allowance for doubtful debts written back

- trade receivables 4,999 - 4,963 -

- other receivables 2,914 - - -

Reversal of write down of quoted shares 2,220 - 2,220 -

Bad debt recovered from subsidiaries - - - 3,392

Realised foreign exchange gain 1,264 2,405 1,268 2,405

Unrealised foreign exchange gain 514 87 514 87

Rental income 1,935 2,264 1,933 2,256

Gain on redemption of unquoted private debt securities - 24 - -

Gain on disposal of quoted shares 620 4,817 620 4,817

Gain on disposal of unquoted shares 2,602 - - -



21. KEY MANAGEMENT PERSONNEL COMPENSATION

The key management personnel compesation are as follows:

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

Directors

- Fees 422 381 409 363

- Other emoluments 1,797 1,167 1,797 1,167

2,219 1,548 2,206 1,530

Other key management personnel

- Salaries, bonuses and allowances 3,853 3,493 3,493 3,224

- Defined contribution plan 605 487 529 417

4,458 3,980 4,022 3,641

6,677 5,528 6,228 5,171

Other key management personnel comprises persons other than the Directors of Group entities, having authority and responsibility for planning, directing and controlling the activities of the entity either directly or indirectly.

Company Group

Note2009

RM’0002008

RM’0002009

RM’0002008

RM’000

Income tax expense:

Malaysian income tax 30,786 31,024 30,479 29,796

Over provision in prior years (2,372) (1,560) (1,600) (1,542)

28,414 29,464 28,879 28,254

Deferred tax expense:

Relating to origination and reversal of temporary differences

16 (247) 3,544 (563) 3,057

Under/(over) provision in prior years 16 4,386 (225) 4,017 (74)

4,139 3,319 3,454 2,983

Total tax expense 32,553 32,783 32,333 31,237

22. TAX EXPENSE



22. TAX EXPENSE (continued)

A reconciliation of income tax expense applicable to profit/(loss) before taxation at the statutory income tax rate to income tax

expense at the effective income tax rate of the Group and of the Company is as follows:

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

Profit/(loss) before tax 109,264 (519) 101,405 12,478

Tax calculated using Malaysian tax rate of:

- 25% (2008- 26%)* 27,316 (91) 25,351 3,244

- 20% ** - (52) - -

Tax exempt income (527) 121 (495) (150)

Effect of change in tax rate on deferred tax brought forward - (497) - (529)

Expenses not deductible for tax purposes 3,813 36,433*** 5,060 30,288***

Utilisation of previously unrecognised deferred tax assets (63) (1,346) - -

30,539 34,568 29,916 32,853

Under/(over) provision in prior years

- income tax (2,372) (1,560) (1,600) (1,542)

- deferred tax 4,386 (225) 4,017 (74)

Tax expense 32,553 32,783 32,333 31,237

* The corporate tax rate is 25% for the year of assessment 2009 (2008: 26%) and subsequent years of assessment. Consequently, deferred tax assets and liabilities are measured using this tax rate.

** With effect from year of assessment 2004, companies with paid-up capital of RM2.5 million and below at the beginning of the basis period for a year of assessment are subject to the corporate tax at 20% on chargeable income up to RM500,000. However, with effect from year of assessment 2009, the 20% tax rate will not be applicable for companies which are controlled by another company with paid up capital exceeding RM2.5 million.

*** Included in the amount of expenses not deductible for tax purposes in the previous year were impairment losses for Group and Company amounting RM116,098,000 and RM97,647,000 respectively.



23. EARNINGS PER SHARE

Basic earnings per share

The earnings per ordinary share for the financial year has been calculated based on the consolidated net profit for the financial

year of RM76,711,000 (2008– net loss of RM33,302,000) and on the weighted average number of ordinary shares in issue during

the financial year of 537,026,085 (2008 - 537,026,085).

24. DIVIDENDS

Dividends recognised in the current year by the Company are:

Sen

per share(net of tax)

Total amountRM’000

2009

Final dividend in respect of financial year ended 31 December 2008 7.5 40,277

The Company did not declare and pay any interim dividends in respect of the financial year ended 31 December 2009. However,

subsequent to the balance sheet date the following dividends were proposed by the Directors. These dividends will be recognised

in subsequent financial reports upon approval by the shareholders.

Sen

per share(net of tax)

Total amountRM’000

Final dividend 12.5 50,346



25. CAPITAL COMMITMENTS

Group Company

2009RM’000

2008RM’000

2009RM’000

2008RM’000

Property, plant and equipment

Approved and contracted for 188,392 76,518 187,880 76,194

Approved but not contracted for 198,857 292,931 193,255 281,967

387,249 369,449 381,135 358,161

26. COMMITMENTS AND CONTINGENCIES

Pursuant to the agreement entered into with Malayan i.

Banking Berhad (“MBB”) on the sale of PhileoAllied

Bank (Malaysia) Berhad and Phileo Allied Securities

Sdn. Bhd. dated 30 August 2000 (“the Share Sale

Agreement”) Pos Malaysia & Services Holdings

Berhad (“PSH”) and its subsidiary, PSH Allied

Berhad (“PSHAB”) have given certain warranties,

undertakings and obligations to MBB, which shall

continue for a period of twenty four (24) months

from the Completion Date of the agreement of 31

January 2001. Save as disclosed in Note 26 (a)(iii) to

(v) below, as at the date of the financial statements,

there are no other legal suits filed by MBB arising from

the above warranties, undertakings and obligations.

- Group and Company

For the material litigation matters identified in the ii.

Share Sale Agreement, PSH and PSHAB have agreed

to indemnify MBB to the extent of the amount stated

in the final judgement (including taxed costs and costs

of solicitors in defending the claims) if the claim for

indemnify is received by PSH and PSHAB within 4

years from the Completion Date of 31 January 2001.

(a)



On 18 January 2002, PSH and PSHAB (“the iii.

Defendants”) were served with a Writ of Summons

and Statement of Claim by MBB (“the Plaintiff ”)

(Kuala Lumpur High Court Civil Suit D3-22-2240-

2001). Subsequently, an Amended Writ of Summons

and Amended Statement of Claim were served on

the Defendants by the Plaintiff on 19 March 2002. The

Plaintiff claims against the Defendants for :

(1) declaration that the Defendants are in breach

of their warranties and undertakings under

the Share Sale Agreement in failing to make

specific disclosure of the condition of the loan

and security documents in relation to the credit

facility granted by Phileo Allied Credit & Leasing

Sdn. Bhd. to Salient Growth Sdn. Bhd.;

(2) a declaration that the Defendants are liable, jointly

and severally, to indemnify the Plaintiff and keep

indemnified the Plaintiff from and against all

claims, demands, damages, losses (including loss of

profit), costs, obligations, penalties, liabilities, fines

and expenses sustained by the Plaintiff in respect

of the Defendants’, or either of the Defendants’

breach referred to in (1) above;

(3) that the Plaintiff be indemnified as referred to in (2)

above and be at liberty to apply for an assessment

of the amount to be paid thereunder ;

(4) damages to be assessed;

(5) that the cost of the action be borne by the

Defendants; and

(6) such further or other reliefs as the Court deems

fit and proper.

On 30 July 2002, the Defendants’ application to strike

out Plaintiff ’s Writ of Summons was allowed with costs

by the Senior Assistant Registrar. A Notice of Appeal to

Judge In Chambers dated 6 August 2002 filed by the

Plaintiff has been dismissed with costs on 25 April 2003.

A Notice of Appeal to the Court of Appeal dated 20

May 2003 has been filed by the Plaintiff.

At the hearing on 23 July 2009 at the Court of Appeal,

the court had allowed MBB’s appeal with costs at the

Court of Appeal. The matter will now therefore proceed

to trial.

The matter has been fixed for case management before

the Judge on 5 May 2010.

On 2 April 2003, PSH and PSHAB (“Defendants”) iv.

were fur ther served with another Writ of Summons

and Statement of Claim (Kuala Lumpur High Court

Civil Suit No. D3-22-330-2003) by MBB (“the

Plaintiff ”). The Plaintiff claims against the Defendants

for the following:

(1) a declaration that the Defendants are in breach

of the warranties and undertakings under the

Share Sale Agreement in failing to make specific

disclosure of the condition of two margin

accounts maintained by Zuhrah Sentosa Sdn.

Bhd. and Ujung Prinsip Sdn. Bhd. respectively with

Mayban Securities Sdn. Bhd.



26. COMMITMENTS AND CONTINGENCIES (continued)

(2) a declaration that Defendants are liable, jointly

and severally to indemnify the Plaintiff and keep

indemnified the Plaintiff from and against all

claims, demands, damages, losses (including loss of

profit), costs, obligations, penalties, liabilities, fines

and expenses sustained by the Plaintiff in respect

of the Defendants’ or either of the Defendants’

breach referred to in (1) above;

(3) that the Plaintiff be indemnified as referred

to in (2) above and be at liberty to apply for

an assessment of the amount to be paid

thereunder ;

(4) special damages in the sum of RM41,790,851.83

as at 31 January 2000 with interest thereon at

the rate of 12.25% per annum from 1 February

2000 until the date of full payment;

(5) general damages;

(6) interest on the sums payable as damages;

(7) costs to be borne by the Defendants; and

(8) such further or other reliefs as the Court deems

fit and proper.

On 16 June 2004, the Defendants’ application to strike

out the Plaintiff ’s Writ of Summons was allowed with

costs by the Senior Assistant Registrar. A Notice of

Appeal to Judge In Chambers has been filed by the

Plaintiff on 24 June 2004 to appeal against the decision

of the Senior Assistant Registrar.

The same was dismissed by the learned Judge on 26 April

2005. The Plaintiff has appealed to Court of Appeal vide

Notice of Appeal dated 25 May 2005 in CA Civil Appeal

No. W-03-86-2005.




to trial.


the Judge on 5 May 2010.

On 2 April 2003, PSH and PSH Allied Berhad v.

(“Defendants”) were also served with a Writ of

Summons and Statement of Claim (Kuala Lumpur

High Court Civil Suit No. D3-22-331-2003) by

MBB (“the Plaintiff ”). The Plaintiff claims against the

Defendants for the following:

(1) a declaration that the Defendants are in breach

of the warranties and under takings under the

Share Sale Agreement in failing to make specific

disclosure of the action instituted by Zainuddin

bin Abu Bakar against Mayban Allied Berhad

vide Kuala Lumpur High Cour t Suit No.D2-22-

1853-2000;



(2) a declaration that the Defendants are liable,

jointly and severally, to indemnify the Plaintiff

and keep indemnified the Plaintiff from and

against all claims, demands, damages, losses

(including loss of profit), costs, obligations,

penalties, liabilities, fines and expenses sustained

by the Plaintiff in respect of the Defendants’ or

either of the Defendants’ breach referred to in

(1) above;

(3) that the Plaintiff be indemnified as referred

to in (2) above and be at liber ty to apply

for an assessment of the amount to be

paid thereunder ;

(4) special damages in the sum of RM6,021,462

with interest thereon at the rate of 8% per

annum from 3 October 2000 until the date of

full payment;

(5) general damages;

(6) interest on the sums payable as damages;

(7) costs to be borne by the Defendants; and

(8) such fur ther or other reliefs as the Cour t

deems fit and proper.

On 16 June 2004, the Defendants’ application to strike

out Plaintiff ’s Writ of Summons was allowed with costs

by the Senior Assistant Registrar. A Notice of Appeal to

Judge In Chambers has been filed by the Plaintiff on 24

June 2004 to appeal against the decision of the Senior

Assistant Registrar.

The same was dismissed by the learned Judge on 26

April 2005. The Plaintiff has appealed to Court of Appeal

vide Notice of Appeal dated 25 May 2005 in CA Civil

Appeal No. W-03-87-2005




to trial.


the Judge on 5 May 2010

The Company has given financial suppor t to cer tain

subsidiaries to meet all their liabilities due within the

next 12 months.

(b)



27. SEGMENTAL REPORTING

The Group has three reportable segments, as described below, which are the Group’s strategic business units. The strategic

business units offer different products and services and are managed separately because they require different business processes

and customer needs. The following summary describes the operations in each of the Group’s reportable segments:

Mail•

Includes the provision of basic mail services for corporate and individual customers and

customised solutions such as Mailroom Management, Direct Mail and hybrid mail which

provides Data and Document Processing services.

Courier and logistic• Includes logistics and courier solutions by sea, air and land to both national and

international destinations.

Retail• Includes over-the-counter services for payment of bills and certain financial products and

services.

Other operations include the business of internet security

products, solutions and services and rental income from

investment properties held by the Group. None of these

segments meets any of the quantitative thresholds for

determining reportable segments in 2009 and 2008.

There are varying levels of integration between the Mail

reportable segment and the Courier and Logistics reportable

segments. This integration includes shared distribution

services. The accounting policies of the reportable segments

are the same as described in note 2(s).

Information regarding the operations of each reportable

segment is included below. Performance is measured based

on segment results. Segment results is used to measure

performance as management believes that such information

is the most relevant in evaluating the results of certain

segments relative to other entities that operate within these

industries. Inter-segment pricing is determined on an arm’s

length basis.



Year Ended 31 December 2009Mail

Courier& Logistic Retail Others Elimination Group

Revenue

Total external revenue 576,850 175,389 138,968 11,354 - 902,561

Intersegment revenue 20,409 353 (765) 9,394 (29,391) -Total revenue for reportable segments 597,259 175,742 138,203 20,748 (29,391) 902,561

Reportable segment results 85,822 13,148 (18,363) 2,151 (405) 82,353

Other unallocated income 26,911Profit before taxation 109,264

Reportable segments assets 265,998 97,689 187,209 147,416 (49,852) 648,460

Other unallocated assets 626,127Total assets 1,274,587

Reportable segment liabilities 48,857 17,064 136,443 896 - 203,260

Other unallocated liabilities 271,734Total liabilities 474,994

Other information

Capital expenditure

- Property, plant & equipment 44,829 6,164 28,455 253 (1,112) 78,589

Depreciation and amortisation 24,976 12,244 10,336 1,763 (364) 48,955

Interest income - - - - - (12,860)

Interest expense 976 748 81 - - 1,805

Allowance for impairment in valuewritten back

- - - - - 5,134

Taxation - - - - - 32,553



Year Ended 31 December 2008Mail

Courier& Logistic Retail Others Elimination Group

Revenue

Total external revenue 580,405 171,666 143,583 26,012 - 921,666

Intersegment revenue 13,669 459 (748) 858 (14,238) -Total revenue for reportable segments 594,074 172,125 142,835 26,870 (14,238) 921,666

Reportable segment results 83,979 15,217 (17,833) 7,561 (2,695) 86,229

Other unallocated expenses (86,748)Loss before taxation (519)

Reportable segments assets 243,986 97,140 186,954 101,029 - 629,109

Other unallocated assets 908,732Total assets 1,537,841

Reportable segment liabilities 53,069 18,986 429,661 1,497 - 503,213

Other unallocated liabilities 267,598Total liabilities 770,811

Other information

Capital expenditure

- Property, plant & equipment 30,217 32,002 40,784 3,761 - 106,764

Depreciation and amortizsation 20,834 9,008 9,275 1,695 (345) 40,467

Interest income - - - - - (18,919)

Interest expense 383 385 65 - - 833

Allowance for impairment in valuewritten back

- - - - - 116,098

Taxation - - - - - 32,783



28. SIGNIFICANT RELATED PARTY TRANSACTIONS

For the purposes of these financial statements, parties are considered to be related to the Group or the Company if the Group or the Company has the ability, directly or indirectly, to control the party or exercise significant influence over the party in making financial and operating decisions, or vice versa, or where the Group or the Company and the party are subject to common control or common significant influence. Related parties may be individuals or other entities.

Key management personnel are defined as those persons having authority and responsibility for planning, directing and controlling the activities of the Group either directly or indirectly. The key management personnel includes all the Directors of the Group, and certain members of senior management of the Group.

Transactions with government departments and agencies or with entities providing public utilities are entered at arms length by vir tue of their normal dealings as a public utility or a government department and agency.

Group

2009

RM’0002008

RM’000

Purchase of paper based supplies from an associate company:

Elpos Print Sdn. Bhd. 7,160 9,679

Information regarding outstanding balances arising from related party transactions are disclosed in Note 12 and Note 18 to the financial statements.

There are no allowances for doubtful debts being provided in respect of these balances outstanding at year end at 31 December 2009 and 2008 and no allowances for doubtful debts made during the year and the previous year as the balances are amount payable to related parties.



29. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES

Financial risk management objectives and policies

The Group’s and the Company’s activities expose it to a variety of financial risk, including foreign currency exchange risk, interest rate risk, credit risk, liquidity and cash flow risk. The Group’s and the Company’s overall financial risk management objective is to ensure the continuous growth in profitability and enhance shareholders’ value in a competitive and changing environment. At the same time, the Group and the Company is focused in performing its Universal Service Obligation as a provider of postal service throughout the country and to international destinations in an efficient and effective manner.

Foreign currency risk

The Group and the Company is exposed to currency exchange risk as a result of providing foreign mail exchange service and remittance service. However the material portion of the exposure is in US Dollar and the Group and the Company ensures that the net exposure is kept to an acceptable level by monitoring the fluctuation of the foreign currency.

Interest rate risk

The Group’s and the Company’s income and operating cash flows are substantially independent of the changes in market interest rate except for the Group’s and the Company’s investment in fixed-rate debt securities which are exposed to a risk of change in their fair value due to

changes in interest rates. The Group’s and the Company’s short term deposits are placed at fixed rate investments which management endeavours to obtain the best rate available in the market.

Credit risk

The Group and the Company seeks to control credit risk by setting counter party limits and ensuring that services are made to customers with an appropriate credit history. The trade receivables are all collectable and adequate allowance for bad and doubtful debts are provided for.

At the balance sheet date there were no significant concentrations of credit risk. The maximum exposure to credit risk is represented by the carrying amount of each financial asset in the balance sheet.

Liquidity and cash flow risk

Prudent liquidity risk management implies maintaining sufficient liquid assets to meet financial commitments and obligations when they fall due at a reasonable cost. The Group and the Company ensures that liquidity requirements are met and surplus is within limits set to avoid liquidity surpluses which may result in loss of income opportunities.



STATEMENT BY DIRECTORS PURSUANT TO SECTION 169(15) OF THE COMPANIES ACT, 1965

In the opinion of the Directors, the financial statements set out on pages 5 to 68 are drawn up in accordance with Financial

Reporting Standards and the Companies Act, 1965 in Malaysia so as to give a true and fair view of the financial position of

the Group and of the Company as of 31 December 2009 and of their financial performance and cash flows for the year

then ended.

Signed on behalf of the Board of Directors in accordance with a resolution of the Directors:


Dato’ Syed Faisal Albar bin Syed A.R Albar

Date: 31 March 2010



STATUTORY DECLARATION PURSUANT TO SECTION 169(16) OF THE COMPANIES ACT, 1965

I, Mohd Lutfi bin Mat Lazim, the officer primarily responsible for the financial management of Pos Malaysia Berhad, do

solemnly and sincerely declare that the financial statements set out on pages 5 to 68 are, to the best of my knowledge

and belief, correct and I make this solemn declaration conscientiously believing the same to be true, and by vir tue of the

provisions of the Statutory Declarations Act, 1960.

Subscribed and solemnly declared by the above named in Kuala Lumpur on

Mohd Lutfi bin Mat Lazim

Before me:



INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF POS MALAYSIA BERHAD

Report on the Financial Statements

We have audited the financial statements of Pos Malaysia

Berhad, which comprise the balance sheets as at 31

December 2009 of the Group and of the Company,

and the income statements, statements of changes in

equity and cash flow statements of the Group and of

the Company for the year then ended, and a summary

of significant accounting policies and other explanatory

notes, as set out on pages 5 to 68.

Directors’ Responsibility for the Financial Statements

The Directors of the Company are responsible for

the preparation and fair presentation of these financial

statements in accordance with Financial Reporting

Standards and the Companies Act, 1965 in Malaysia.

This responsibility includes: designing, implementing and

maintaining internal control relevant to the preparation

and fair presentation of financial statements that are free

from material misstatement, whether due to fraud or error ;

selecting and applying appropriate accounting policies;

and making accounting estimates that are reasonable in

the circumstances.

Auditors’ Responsibility

Our responsibility is to express an opinion on these

financial statements based on our audit. We conducted

our audit in accordance with approved standards on

auditing in Malaysia. Those standards require that we

comply with ethical requirements and plan and perform

the audit to obtain reasonable assurance whether the

financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit

evidence about the amounts and disclosures in the

financial statements. The procedures selected depend

on our judgment, including the assessment of risks

of material misstatement of the financial statements,

whether due to fraud or error. In making those risk

assessments, we consider internal control relevant to

the Company’s preparation and fair presentation of the

financial statements in order to design audit procedures

that are appropriate in the circumstances, but not for the

purpose of expressing an opinion on the effectiveness

of the Company’s internal control. An audit also includes

evaluating the appropriateness of accounting policies used

and the reasonableness of accounting estimates made by

the Directors, as well as evaluating the overall presentation

of the financial statements.



INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF POS MALAYSIA BERHAD

In our opinion, the accounting and other records and a. the registers required by the Act to be kept by the Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance with the provisions of the Act.

Theb. subsidiar y in respect of which we have not acted as auditors are identified in Note 7 of which was consolidated using its management financial statements.

Wec. are satisfied that the accounts of the subsidiaries that have been consolidated with the Company’s financial statements are in form and content appropriate and proper for the purposes of the preparation of the financial statements of the Group and we have received satisfactory information and explanations required by us for those purposes.

Thed. audit reports on the accounts of the subsidiaries did not contain any qualification or any adverse comment made under Section 174(3) of the Act.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

In our opinion, the financial statements have been properly drawn up in accordance with Financial Reporting Standards and the Companies Act, 1965 in Malaysia so as to give a true and fair view of the financial position of the Group and of the Company as of 31 December 2009 and of their financial performance and cash flows for the year then ended.

Report on Other Legal and Regulatory Requirements

In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following:

Other Matters

This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other person for the content of this report.



KPMG Mohamed Raslan Abdul RahmanFirm Number : AF 0758 Approval Number : 1825/05/11(J/PH)Chartered Accountants Chartered Accountant

Petaling Jaya, Date: 31 March 2010




Top 10 Properties

1. Alienated Land Shah Alam HS(D) 98478, PT No 1 Sek 21, Bandar Shah Alam, District of Petaling Jaya,State of Selangor

PMB Properties Sdn Bhd MPC Section 21 Shah Alam/Double Storey Office Building, 2 units of 1 ½ Storey Factory Buidling, etc

Leasehold 99 years(remaining 85 years) /expiring 19/7/2094

90,071.82 sq mt 500,000 sq.ft. 71,064,000 70,858,040

2. Building Pej Pos Besar Kuala Lumpur

HS(D) 49280, PT 46 Sek 70, Bandar Kuala Lumpur,District of Kuala Lumpur,State of Wilayah Persekutuan, KL

Pesuruhjaya Tanah Persekutuan

General Post Office / Eight Storey Building

Leasehold 99 years (expiring 27/01/2079) / Approximately 25 years

8,496 sq mt (91,453 sq ft)

44,519 sq mt 60,000,000 31,224,489.43

3. Alienated Land Mail and Courier Complex

Mukim of Sepang,District of Sepang,State of Selangor

Malaysia Airports (Sepang) Sdn Bhd

Mail and Courier Complex Concession 36,950 sq. mt 201,600 sq. ft. 34,277,932.04 21,744,279.05

4. Alienated Land Ipoh Pajakan Negeri 155068for Lot 2436N, Town of Ipoh, Daerah Kinta,Perak Darul Ridzuan

Effivation Sdn Bhd Vacant Land Leasehold 999 Years (expiring on 30/12/2893) /Acquired 26/09/1997

14,102sq ft (1,310.1677 mp)

Not applicable 3,262,660 15,071,000

Alienated Land Ipoh Pajakan Negeri 155069for Lot 2437N, Town of Ipoh, Daerah Kinta,Perak Darul Ridzuan


15,328 sq ft (1,423.9853 mp)

Not applicable 2,804,939

Alienated Land Ipoh Pajakan Negeri 4738 for Lot 31448, Town of Ipoh, Daerah Kinta,Perak Darul Ridzuan

Effivation Sdn Bhd Vacant Land Leasehold 999 Years (expiring on 24/03/2895) / Acquired 25/09/1997

29,294sq ft (2,721.5066 mp)




23,985 sq ft (2,228.2968 mp)




16,144 sq ft Not applicable

No Type Location Subject PropertyRegistered/ Beneficial Owner

Existing Use/ Description


1. Alienated Land Shah Alam HS(D) 98478, PT No 1 Sek 21, Bandar Shah Alam, District of Petaling Jaya,State of Selangor

PMB Properties Sdn Bhd MPC Section 21 Shah Alam/Double Storey Office Building, 2 units of 1 ½ Storey Factory Buidling, etc

Leasehold 99 years(remaining 85 years) /expiring 19/7/2094

90,071.82 sq mt 500,000 sq.ft. 71,064,000 70,858,040

2. Building Pej Pos Besar Kuala Lumpur

HS(D) 49280, PT 46 Sek 70, Bandar Kuala Lumpur,District of Kuala Lumpur,State of Wilayah Persekutuan, KL


General Post Office / Eight Storey Building

Leasehold 99 years (expiring 27/01/2079) / Approximately 25 years

8,496 sq mt (91,453 sq ft)

44,519 sq mt 60,000,000 31,224,489.43

3. Alienated Land Mail and Courier Complex

Mukim of Sepang,District of Sepang,State of Selangor

Malaysia Airports (Sepang) Sdn Bhd

Mail and Courier Complex Concession 36,950 sq. mt 201,600 sq. ft. 34,277,932.04 21,744,279.05

4. Alienated Land Ipoh Pajakan Negeri 155068for Lot 2436N, Town of Ipoh, Daerah Kinta,Perak Darul Ridzuan


14,102sq ft (1,310.1677 mp)

Not applicable 3,262,660 15,071,000



15,328 sq ft (1,423.9853 mp)




29,294sq ft (2,721.5066 mp)




23,985 sq ft (2,228.2968 mp)




16,144 sq ft Not applicable

Tenure/ Age of Building Land Area Gross Floor Area

Cost of Purchase/ Lease Amount (RM)

Net Book Value (RM)as of 31 December 2009



Top 10 Properties

4. Alienated Land Ipoh GRN 55283 for lot 31449Town of Ipoh,Daerah Kinta,Perak Darul Ridzuan

Effivation Sdn Bhd Vacant Land Freehold Acquired 31/10/1997

32,398 sq ft (3,009.8447 mp)


Alienated Land Ipoh Pajakan Negeri 155073 for Lot 2740N, Town of Ipoh,Daerah Kinta,Perak Darul Ridzuan


16,226 sq ft (1,507.4516 mp)


5. Registered Land Bukit Raja HS(D) 56783, PT 27615,Mukim of Kapar,District of Klang,State of Selangor

Pos Malaysia Berhad Mail Centre and Office / Warehouse with attached three storey office

Freehold / Approximately 12 years

8,809 sq mt �60,465 sq ft 10,300,000 13,928,628.72

6. Registered Land Larkin HS(D) 109201, PT TLO 682, Bandar Johor Bahru,District of Johor Bahru,State of Johor

Pos Malaysia Berhad Mail Centre, Johor Bahru/ a Single Storey detached Warehouse with a double storey office annex and a Single storey detached office block and detached warehouse, etc

Leasehold 60 years (expiring 15/12/2021) / Not available

20,234 sq mt 6,600.82 sq mt 10,300,000 13,544,802.28

7. Building Persiaran Greenhill

Refer notes Real Riviera Sdn Bhd Office Building/7 Storey Building

Leasehold 84 to 900 years expiring as per note below- Approximately 14 years Acquired 2/8/1994

6,840 sq ft 34,190 sq ft 9,556,461 7,352,656.26

8. Alienated Land Kota Kinabalu

Town Lease 017542746 Lot 017542746 Location ofKota Kinabalu Town District ofKota Kinabalu, State of Sabah


Post Office / Eleven Storey Building

Leasehold 99 years (expiring 31/12/2074) / Approximately 23 ½ years

6,728.55 sq mt �145,083 sq ft 12,146,000 6,320,877.14



Cont.


4. Alienated Land Ipoh GRN 55283 for lot 31449Town of Ipoh,Daerah Kinta,Perak Darul Ridzuan

Effivation Sdn Bhd Vacant Land Freehold Acquired 31/10/1997

32,398 sq ft (3,009.8447 mp)


Alienated Land Ipoh Pajakan Negeri 155073 for Lot 2740N, Town of Ipoh,Daerah Kinta,Perak Darul Ridzuan


16,226 sq ft (1,507.4516 mp)


5. Registered Land Bukit Raja HS(D) 56783, PT 27615,Mukim of Kapar,District of Klang,State of Selangor

Pos Malaysia Berhad Mail Centre and Office / Warehouse with attached three storey office

Freehold / Approximately 12 years

8,809 sq mt �60,465 sq ft 10,300,000 13,928,628.72

6. Registered Land Larkin HS(D) 109201, PT TLO 682, Bandar Johor Bahru,District of Johor Bahru,State of Johor

Pos Malaysia Berhad Mail Centre, Johor Bahru/ a Single Storey detached Warehouse with a double storey office annex and a Single storey detached office block and detached warehouse, etc

Leasehold 60 years (expiring 15/12/2021) / Not available

20,234 sq mt 6,600.82 sq mt 10,300,000 13,544,802.28

7. Building Persiaran Greenhill

Refer notes Real Riviera Sdn Bhd Office Building/7 Storey Building

Leasehold 84 to 900 years expiring as per note below- Approximately 14 years Acquired 2/8/1994

6,840 sq ft 34,190 sq ft 9,556,461 7,352,656.26

8. Alienated Land Kota Kinabalu

Town Lease 017542746 Lot 017542746 Location ofKota Kinabalu Town District ofKota Kinabalu, State of Sabah


Post Office / Eleven Storey Building

Leasehold 99 years (expiring 31/12/2074) / Approximately 23 ½ years

6,728.55 sq mt �145,083 sq ft 12,146,000 6,320,877.14

Tenure/ Age of Building Land Area Gross Floor Area





Top 10 Properties

9. Registered Land Bangi HS(D) 52880, PT 41029, Bandar Baru Bangi, District of Hulu Langat, State of Selangor

Pos Malaysia Berhad Mail Centre / Warehouse with attached office ( 2 Units)

Leasehold 99 years expiring 19/08/2098 / Approximately 9 years

6267 sq mt (1.5486 acres)

22,000 sq ft 2,800,000 5,975,869.41

Registered Land Bangi HS(D) 52881, PT 41030, Bandar Baru Bangi, District of Hulu Langat, State of Selangor


4,206 sq mt (1.0393 acres)

22,000 sq ft 2,400,000

10. Building Jalan Damansara

Unit Nos. F108, F110, F111, F112, F113, F208, F210, F211, F212 & F213, Phileo Damansara, Jalan Damansara, Petaling Jaya, State of Selangor

PSH Properties Sdn .Bhd Office and Commercial units Freehold - 15,509 sq ft 7,694,004.63 7,205,277.82

Notes:-

* HS(D) Ka 21276 PT 18020 99 years expiring on 20/12/2078

* HS(D) Ka 7533/79 PT 18021 99 years expiring on 20/12/2078


* PN 101760 Lot 8619 N 999 years expiring on 21/09/2894






9. Registered Land Bangi HS(D) 52880, PT 41029, Bandar Baru Bangi, District of Hulu Langat, State of Selangor

Pos Malaysia Berhad Mail Centre / Warehouse with attached office ( 2 Units)


6267 sq mt (1.5486 acres)

22,000 sq ft 2,800,000 5,975,869.41

Registered Land Bangi HS(D) 52881, PT 41030, Bandar Baru Bangi, District of Hulu Langat, State of Selangor


4,206 sq mt (1.0393 acres)

22,000 sq ft 2,400,000

10. Building Jalan Damansara

Unit Nos. F108, F110, F111, F112, F113, F208, F210, F211, F212 & F213, Phileo Damansara, Jalan Damansara, Petaling Jaya, State of Selangor

PSH Properties Sdn .Bhd Office and Commercial units Freehold - 15,509 sq ft 7,694,004.63 7,205,277.82

Notes:-

* HS(D) Ka 21276 PT 18020 99 years expiring on 20/12/2078






Tenure/ Age of Building




Authorised Capital: RM1,000,000,001.00 divided into 2,000,000,000 ordinary shares of RM0.50 each and 1 Special

Rights Redeemable Preference Share of RM1.00

Issued and full paid-up capital: RM268,513,043.50 comprising 537,026,085 ordinary shares of RM0.50 each and one (1) Special

Rights Redeemable Preference Share of RM1.00

Voting Rights: One vote for every ordinary share

(The Special Rights Redeemable Preference Share does not carry any voting rights except in

circumstances set out in the Company’s Articles of Association)

No. Shareholders: 25,673

Substantial Shareholders

Direct Indirect

Shareholders No. of shares % No. of shares %

1. Khazanah Nasional Berhad 172,997,399 32.21 - -

2. Employees Provident Fund Board 51,507,400 9.59 - -

3. Permodalan Nasional Berhad 45,395,300 8.45

4. Amanahraya Trustees BerhadSkim Amanah Saham Bumiputera

43,907,400 8.18

5. Aberdeen Asset Management PLC and its subsidiaries 42,244,600 * 7.87 - -

6. Aberdeen Asset Management Asia Limited 31,451,900 * 5.86 - -

7. Minister of Finance (Inc.) - - 172,997,399 (a) 32.21

8. Yayasan Pelaburan Bumiputra - - 45,395,300 (b) 8.45

9. Credit Suisse Group AG - - 46,144,600 (c) 8.59

10. Mitsubishi UFJ Financial Group, Inc - - 42,244,600 (d) 7.87

Notes:* Includes holdings of mandates delegated from other subsidiaries of Aberdeen Asset Management PLC.(a) Deemed interested through Khazanah Nasional Berhad.(b) Deemed interested through Permodalan Nasional Berhad. (c) Deemed interested through Aberdeen Asset Management PLC and its subsidiaries and Credit Suisse Securities (USA) LLC. (d) Deemed interested through its wholly-owned subsidiary, Mitsubishi UFJ Trust & Banking Corp, holding more than 15% in Aberdeen Asset Management PLC.

Analysis of Shareholdings as at 15 March 2010


Distribution of Shareholdings

Holdings No. of Shares

% of Issued Share Capital

No. of Shareholders/Depositors

% of Shareholders/Depositors

Less than 100 266,928 0.05 5,767 22.46

100 to 1,000 6,149,880 1.15 9,631 37.51

1,001 to 10,000 31,921,764 5.94 8,791 34.24

10,001 to 100,000 35,288,078 6.57 1,344 5.24

100,001 to 26,851,303 149,591,936 27.86 136 0.53

26,851,304 and above 313,807,499 58.43 4 0.02Total 537,026,085 100.00 25,673 100.00

30 Largest Registered Shareholders

No. Name No. of Shares Percentage (%)

1 Khazanah Nasional Berhad 172,997,399 32.21

2 Employees Provident Fund Board 51,507,400 9.59

3 Permodalan Nasional Berhad 45,395,300 8.45

4 Amanahraya Trustees BerhadSkim Amanah Saham Bumiputera

43,907,400 8.18

5 HSBC Nominees (Asing) Sdn BhdBNP Paribas Securities Services Lux for Aberdeen Global

15,149,100 2.82

6 CIMSEC Nominees (Tempatan) Sdn BhdPrima Pegun Sdn Bhd

14,570,332 2.71

7 Valuecap Sdn Bhd 10,098,500 1.90

8 HSBC Nominees (Asing) Sdn BhdExempt An For JPMorgan Chase Bank, National Association (Bermuda)

10,000,000 1.86

9 HSBC Nominees (Asing) Sdn BhdRBS Coutts Sg for Glenmorgan Company Inc

6,130,000 1.14

10 Pertubuhan Keselamatan Sosial 5,592,400 1.04



11 Cartaban Nominees (Asing) Sdn BhdState Street London Fund XCB9 for Aberdeen Asian Smaller Companies Investment Trust Plc

5,500,000 1.02

12 HSBC Nominees (Asing) Sdn Bhd Exempt An for JPMorgan Chase Bank, National Association (Norges Bk Lend)

4,412,000 0.82

13 Mayban Nominees (Tempatan) Sdn BhdAberdeen Asset Management Sdn Bhd for Kumpulan Wang Persaraan (Diperbadankan) (FD 1- 280305)

4,320,400 0.80

14 HSBC Nominees (Asing) Sdn BhdExempt An for BNP Paribas Securities Services (Singapore-SGD)

4,183,900 0.78

15 Cartaban Nominees (Asing) Sdn BhdState Street London Fund XCP2 for Aberdeen Asian Income Fund Limited

4,000,000 0.74

16 Cartaban Nominees (Asing) Sdn BhdCredit Suisse Securities (USA) LLC (FIRM)

3,750,000 0.70

17 Citigroup Nominees (Asing) Sdn BhdCBNY for Dimensional Emerging Markets Value Fund

3,546,617 0.66

18 Mayban Nominees (Tempatan) Sdn BhdAberdeen Asset Management Sdn Bhd for the Employees’ Provident Fund Board (250416)

3,276,800 0.61

19 Amsec Nominees (Tempatan) Sdn Bhd Aberdeen Asset Management Sdn Bhd for TenagaNasional Berhad Retirement Benefit Trust Fund(FM-Aberdeen)

2,836,500 0.53

20 Amanahraya Trustees BerhadPublic Islamic Select Treasures Fund

2,247,600 0.42

21 Affin Nominees (Asing) Sdn BhdUOB Kay Hian Pte Ltd for Cheng Good Hiang

2,060,000 0.38

22 Mayban Nominees (Tempatan) Sdn BhdMayban Investment Management Sdn Bhd for Kumpulan Wang Simpanan Pekerja (N14011980810)

2,000,000 0.37

23 Amanahraya Trustees BerhadPublic Islamic Opportunities Fund

1,899,500 0.35

24 HSBC Nominees (Asing) Sdn BhdExempt An For JPMorgan Chase Bank, National Association(Guernsey)

1,830,000 0.34

Analysis of Shareholdings as at 15 March 2010


25 Amanahraya Trustees BerhadPublic Islamic Asia Dividend Fund

1,651,600 0.31

26 HSBC Nominees (Asing) Sdn BhdExempt An For Danske Bank A/S (Client Holdings)

1,590,200 0.30

27 Amanahraya Trustees BerhadPublic Islamic Dividend Fund

1,536,400 0.29

28 HLG Nominee (Asing) Sdn BhdHong Leong Fund Management Sdn Bhd for Asia Fountain Investment Company Limited

1,500,000 0.28

29 Kumpulan Wang Simpanan Pekerja 1,500,000 0.28

30 HSBC Nominess (Asing) Sdn BhdExempt An For UBS AG

1,300,000 0.24

Total 430,289,348 80.12

Directors’ Shareholdings as per the Register of Directors’ Shareholdings as at 15 March 2010

Name of Directors Direct Interest % Indirect Interest %

Tan Sri Dato’ Seri (Dr.) Aseh bin Haji Che Mat - - - -

Dato’ Ibrahim Mahaludin bin Puteh - - - -

Dato’ Syed Faisal Albar bin Syed A.R Albar - - - -

Datuk Low Seng Kuan - - - -

Dato’ Krishnan a/l Chinapan - - - -

Puan Sri Datuk Nazariah binti Mohd Khalid - - - -

Tan Sri Dato’ Ir Muhammad Radzi bin Haji Mansor - - - -

Wee Hoe Soon @ Gooi Hoe Soon - - - -

Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin - - - -

Abdul Hamid bin Sh Mohamed - - - -

Eshah binti Meor Sulaiman - - - -

Haizan bin Mohd Khir Johari - - - -



NOTICE IS HEREBY GIVEN THAT

the 18th Annual General Meeting of

Pos Malaysia Berhad will be held at

The Legend Grand Ballroom,

Legend Hotel Kuala Lumpur,

Level 9, Putra Place, 100 Jalan Putra,

50350 Kuala Lumpur

on Wednesday, 12 May 2010

at 10.00 a.m. for the following

purposes:

As Ordinary Business:To1. receive the Audited Financial Statements for the financial year ended 31

December 2009 and the Reports of the Directors and Auditors thereon.

Please refer to Note A.

To 2. declare a first and final dividend of 12.5 sen per ordinary share less 25% tax

in respect of the financial year ended 31 December 2009.

To3. re-elect the following Directors who retire by rotation pursuant to

Article 115 of the Company’s Articles of Association, and who being eligible,

offered themselves for re-election :

To4. re-elect the following Directors who retire pursuant to Article 110

of the Company’s Articles of Association, and who being eligible, offered

themselves for re-election :

To5. re-appoint Messrs KPMG as Auditors of the Company for the ensuing

year and to authorise the Directors to fix their remuneration.

(a) Puan Sri Datuk Nazariah binti Mohd Khalid (Ordinary Resolution 2)

(b) Wee Hoe Soon @ Gooi Hoe Soon (Ordinary Resolution 3)

(c) Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin (Ordinary Resolution 4)

(Ordinary Resolution 1)

(a) Tan Sri Dato’ Ir Muhammad Radzi bin Haji Mansor (Ordinary Resolution 5)

(b) Haizan bin Mohd Khir Johari (Ordinary Resolution 6)



As Special Business:To consider and, if thought fit, pass the following resolution,

with or without modifications, as ordinary resolution:

6. Directors’ Fees

“That the payment of the Directors’ Fees of RM409,232

for the financial year ended 31 December 2009 be hereby

approved.”

7. To transact any other business of which due notice has

been given in accordance with the Companies Act, 1965

and the Company’s Articles of Association.


Notice of Book Closure and Notice of Dividend Entitlement and Payment:NOTICE IS ALSO HEREBY GIVEN THAT the first and final

dividend of 12.5 sen per ordinary share less 25% tax in

respect of the financial year ended 31 December 2009, if

approved by the shareholders at the 18th Annual General

Meeting, will be paid on 11 June 2010 to shareholders whose

names appear in the Register of Members or Record of

Depositors at the close of business on 20 May 2010.

A Depositor shall qualify for entitlement to the dividend only

in respect of:

By Order of the Board,

Sabrina Albakri binti Abu Bakar (LS8508) Company SecretaryKuala Lumpur, 20 April 2010

shares a. deposited into the Depositor’s securities account

before 12.30 p.m. on 18 May 2010 in respect of securities

exempted from mandatory deposit;

sharesb. transferred into the Depositor’s securities account

before 4.00 p.m. on 20 May 2010 in respect of ordinary

transfers; and

sharesc. bought on the Bursa Malaysia Securities Berhad on

a cum entitlement basis according to the Rules of Bursa

Malaysia Securities Berhad.



Note A:

This agenda item is meant for discussion only as the provision

of Section 169(1) of the Companies Act 1965 does not require

a formal approval of the shareholders and hence is not put

forward for voting.

Notes:

A1. member entitled to attend and vote is entitled to appoint a proxy to

attend and vote in his/her stead. A member may appoint a maximum

of two (2) proxies to attend the Meeting provided that such member

holds not less than the minimum board lot as specified under the

Rules and the Main Market Listing Requirements of Bursa Malaysia

Securities Berhad.

Where2. a member appoints two (2) proxies to attend the Meeting,

the member shall specify the proportion of his/her shareholdings

to be represented by each proxy. A proxy may but need not be a

member of the Company and the provisions of Section 149(1)(b) of

the Companies Act 1965 shall not apply to the Company. Where a

member is an authorised nominee as defined under the Securities

Industry (Central Depositories) Act 1991, it may appoint at least

one (1) proxy in respect of each securities account it holds with

ordinary shares of the Company standing to the credit of the said

securities account.

The3. instrument appointing a proxy shall be in writing under the hand

of the appointor or of his attorney duly appointed under a power

of attorney or if such appointor is a corporation, either under the

corporation’s seal or under the hand of an officer or attorney duly

appointed under a power attorney.

The instrument appointing a proxy or representative shall be deposited 4.

at the Company’s Share Registrar’s office at Tricor Investor Services

Sdn Bhd, (formerly known as Tenaga Koperat Sdn Bhd), Level 17, The

Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200

Kuala Lumpur not less than forty-eight (48) hours before the time set

for holding the Meeting or any adjournment thereof.

Additional5. Notes on Special Business:

5.1 Resolution on Directors’ Fees

The proposed Ordinary Resolution No. 8 is in accordance

with the Company’s Ar ticles of Association and if passed,

will authorise the payment of Director’s fees to Directors

of the Company for their services during the financial year

ended 31 December 2009.



PROXY FORM 18TH ANNUAL GENERAL MEETING

THIS SECTION IS INTENTIONALLY LEFT BLANK


OR

II. The CHAIRMAN OF THE MEETING (if no proxy named above);as my/our proxy to vote for me/us and on my/our behalf, at the 18th Annual General Meeting of the Company, to be held at the Legend Grand Ballroom, Legend Hotel Kuala Lumpur, Level 9, Putra Place, 100 Jalan Putra, 50350 Kuala Lumpur on Wednesday, 12 May 2010 at 10.00 a.m. and at any adjournment thereof. My/our proxy is to vote as indicated below:The proportion of my/our holding to be represented by my/our proxies are as follows:

Proxy “A” % Proxy “B” % 100 %

Proxy Form 18th Annual General Meeting

POS MALAYSIA BERHAD (229990-M)

CDS Account No. of Authorised Nominee*

Total Number of Shares Held

I/We,

(FULL NAME OF SHAREHOLDER AS PER NRIC/PASSPORT NO. IN BLOCK LETTERS)

NRIC (new) (old)

of (FULL ADDRESS)

being a member of Pos Malaysia Berhad, hereby appoint the following:

I. (i) “A” (FULL NAME OF PROXY “A” AS PER NRIC/PASSPORT NO. IN BLOCK LETTERS)

NRIC (new) (old)

of (FULL ADDRESS)

or failing him/her(FULL NAME AS PER NRIC/PASSPORT NO. IN BLOCK LETTERS)

NRIC (new) (old)

of (FULL ADDRESS)

(ii) “B” (FULL NAME OF PROXY “B” AS PER NRIC/PASSPORT NO. IN BLOCK LETTERS)

NRIC (new) (old)

of (FULL ADDRESS)

or failing him/her(FULL NAME AS PER NRIC/PASSPORT NO. IN BLOCK LETTERS)

NRIC (new) (old)

of (FULL ADDRESS)

Tel no:

(if applicable)



No. Ordinary Resolution For Against

1 Declaration of Dividend

2 Re-election of Puan Sri Datuk Nazariah binti Mohd Khalid as Director

3 Re-election of Wee Hoe Soon @ Gooi Hoe Soon as Director

4 Re-election of Tunku Dato’ Mahmood Fawzy bin Tunku Muhiyiddin as Director

5 Re-election of Tan Sri Dato’ Ir Muhammad Radzi bin Haji Mansor as Director

6 Re-election of Haizan bin Mohd Khir Johari as Director

7 Re-appointment of Messrs KPMG as the Company’s Auditors for the ensuing year

8 Approval of Directors’ Fees

Please indicate with an (“X”) in the appropriate spaces as to how you wish your votes to be cast on the Ordinary Resolutions specified in the Notice of

the 18th Annual General Meeting. If you do not do so, the Proxy may vote or abstain from voting at his/her discretion.

Signed this day of 2010 Signature(s)/Common Seal of Shareholder(s)

Notes:

A member entitled to attend and vote is entitled to appoint a proxy to attend and vote in his/her stead. A member may appoint a maximum of 1. two (2) proxies to attend the Meeting provided that such member holds not less than the minimum board lot as specified under the Rules and the Main Market Listing Requirements of Bursa Malaysia Securities Berhad.Where a member appoints two (2) proxies to attend the Meeting, the member shall specify the proportion of his shareholdings to be represented 2. by each proxy. A proxy may but need not be a member of the Company and the provisions of Section 149(1)(b) of the Companies Act 1965 shall not apply to the Company. Where a member is an authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991, it may appoint at least one (1) proxy in respect of each securities account it holds with ordinary shares of the Company standing to the credit of the said securities account.The instrument appointing a proxy shall be in writing under the hand of the appointor or of his attorney duly appointed under a power of attorney or if 3. such appointor is a corporation, either under the corporation’s seal or under the hand of an officer or attorney duly appointed under a power attorney.The instrument appointing a proxy or representative shall be deposited at the Company’s Share Registrar’s office at Tricor Investor Services Sdn 4. Bhd (formerly known as Tenaga Koperat Sdn Bhd), Level 17, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur not less than forty-eight (48) hours before the time set for holding the Meeting or any adjournment thereof.

* Applicable to shares held through a nominee account.

Complete this form where applicable, place in envelope and post to:

The Share Registrar

TRICOR INVESTOR SERVICES SDN BHD (118401-V)

(formerly known as Tenaga Koperat Sdn Bhd)

Level 17, The Gardens North Tower

Mid Valley City, Lingkaran Syed Putra

59200 Kuala Lumpur

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