MITRA-AnnualReport2011 (1.2MB).pdf - Announcements - Bursa ...

Notes to The Financial Statements (cont’d)
36. CApITAl MANAGEMENT
The primary objective of the Company’s capital management is to ensure that it maintains a strong credit rating and
healthy capital ratio in order to support its business and maximize shareholder value.
The Company manages its capital structure and makes adjustments to it, in light of changes in economic conditions. To
maintain or adjust the capital structure, the Company may adjust the dividend payment to shareholders, return capital to
shareholders or issue new shares. No changes were made in the objectives, policies or processes during the years ended
31st December 2011 and 31st December 2010.
The Company monitors capital using a gearing ratio, which is net debt divided by total capital plus net debt. The Company
includes within net debt, amount due to holding and ultimate holding company, term loan, trade and other payables, less
cash and bank balances. Capital includes equity attributable to the owners of the parent.
Group
2011 2010
RM RM
Borrowings (Note 19) 57,432,513 90,321,503
Trade and other payables (Note 21) # 77,650,052 86,845,792
Less: Cash and bank balances (Note 15) (3,799,447) (4,656,474)
Net debt 131,283,118 172,510,821
Equity attributable to the owners of the parent 329,220,224 296,267,621
Total capital 329,220,224 296,267,621
Capital and net debt 460,503,342 468,778,442
Gearing ratio 29% 37%
# Progress billings in respect of property development costs were excluded from trade and other payables.
The Group is also required to comply with the disclosure and necessary capital requirements as prescribed in the Main
Market Listing Requirements of Bursa Malaysia Securities Berhad.
37. MATERIAl lITIGATIoN
On 4th January 2006, the Company, its wholly owned subsidiary, Dutawani Sdn. Bhd. (“DSB”) and its Managing Director
were served a writ and statement of claim by Pandan Perkasa Sdn. Bhd. (“PPSB”) for the alleged breach of the Joint
Venture Agreement and the Supplemental Agreement, both dated 12th April 2000 between PPSB and DSB primarily
due to the alleged refusal, failure and neglect of the Company, DSB and its Managing Director from proceeding with
the development of the Kuala Lumpur Sports City (“Proposed Privatisation Re-Development Project”) on the site of the
current Kampung Pandan Sports Complex at Jalan Kampung Pandan/Jalan Perkasa.
PPSB has filed a claim, amongst others, on damages for breach of contract, special damages in the sum of RM195,844/-
and loss of profit in the sum of RM10,029,935/- together with interest and cost.
The Company’s solicitors are of the opinion that the allegations against the Company, DSB and its Managing Director are
baseless due to the overriding decision of the Government of Malaysia in July 2004 to abort the Proposed Privatisation
Re-Development Project and through no fault of the Company, DSB or its Managing Director.
On 18th September 2007, the Learned Judge of the High Court dismissed the Company’s striking out applications.
Subsequently, lawyers on behalf of the Company lodged an appeal for the dismissal of the striking out applications in the
Court of Appeal.
MITRAJAYA HOLDINGS BERHAD ANNUAL REPORT 2011
103