Summary of the S|me Darby 8erhad SWC1 Ana|ys|s report

uaLamonlLors Slme uarby 8erhad SWC1 Analysls company proflle ls Lhe essenLlal source for Lop
level company daLa and lnformaLlon Slme uarby 8erhad SWC1 Analysls examlnes Lhe company's
key buslness sLrucLure and operaLlons hlsLory and producLs and provldes summary analysls of lLs
key revenue llnes and sLraLegy

Slme uarby (or Lhe company) ls engaged ln buslness operaLlons relaLed Lo planLaLlons lndusLrlal
moLors energy and uLlllLles properLy and healLh care and oLhers 1he company operaLes ln Lhe
SouLh LasL Aslan reglon lL ls headquarLered ln kuala Lumpur Malaysla and employs 100000 people
1he company recorded revenues of M?8328447 mllllon ($99188 mllllon) durlng Lhe flnanclal year
ended !une 2010 (l?2010) an lncrease of 39 over l?2009 1he operaLlng proflL of Lhe company
was M?82081 mllllon ($6284 mllllon) durlng l?2010 a decrease of 34 compared wlLh l?2009
1he neL proflL was M?87268 mllllon ($2193 mllllon) ln l?2010 a decrease of 681 compared wlLh
l?2009

Scope of Lhe 8eporL

rovldes all Lhe cruclal lnformaLlon on Slme uarby 8erhad requlred for buslness and compeLlLor
lnLelllgence needs
ConLalns a sLudy of Lhe ma[or lnLernal and exLernal facLors affecLlng Slme uarby 8erhad ln Lhe form
of a SWC1 analysls as well as a breakdown and examlnaLlon of leadlng producL revenue sLreams of
Slme uarby 8erhad
uaLa ls supplemenLed wlLh deLalls on Slme uarby 8erhad hlsLory key execuLlves buslness
descrlpLlon locaLlons and subsldlarles as well as a llsL of producLs and servlces and Lhe laLesL
avallable sLaLemenL from Slme uarby 8erhad
5ime uorby keports Misconduct ot lour nerqy Projects P/ons Leqo/ 4ction
8y 8otty lottet ooJ 5otoyo letmotosotl 5ep 21 2010 1050 AM CM1-0800
Slme uarby 8hd Lhe world's blggesL publlcly Lraded palm oll producer plans Lo sLarL legal
proceedlngs and lodge reporLs wlLh Lhe auLhorlLles afLer flndlng evldence of mlsconducL ln four of lLs
energyrelaLed pro[ecLs
1he company compleLed an audlL and had evldence of lnapproprlaLe conducL and breaches of duLles
and obllgaLlons lL sald ln a sLock exchange flllng ln kuala Lumpur laLe yesLerday
1he board has been advlsed by legal counsel Lo keep confldenLlal Lhe deLalls of Lhe reporL and
naLure of such proceedlngs so as noL Lo adversely affecL Lhe lnLeresLs of Lhe group" Slme uarby sald
1he 100yearold company made LoLal provlslons of 21 bllllon rlngglL ($677 mllllon) ln Lhe year
ended !une 30 on oll and gas pro[ecLs ln Lhe Mlddle LasL Slme uarby sald on Aug 26 1hls lncluded
pro[ecLs wlLh CaLar eLroleum and Maersk Cll CaLar accordlng Lo Lhe sLaLemenL
Slme uarby rose 04 percenL Lo 833 rlngglL ln kuala Lumpur Lradlng aL 1046 am Loday compared
wlLh Lhe 03 percenL galn ln Lhe counLry's benchmark lndex 1he shares have fallen 71 percenL Lhls
year maklng Lhem Lhe worsLperformer on Lhe 30 sLock l1SL 8ursa Malaysla kLCl lndex
1he pro[ecLs revlewed were Slme uarby's englneerlng works aL Lhe 8ulhanlne and Maydan Mahzam
flelds for CaLar eLroleum a Maersk Cll CaLar pro[ecL lncludlng Lhe consLrucLlon of shlps and
Malaysla's 8akun hydroelecLrlc dam pro[ecL
ubber |antat|ons
SeL up ln 1910 as an operaLor of rubber planLaLlons Slme uarby has dlverslfled lnLo buslnesses
ranglng from cars and shlpbulldlng Lo properLy developmenL lL made an unsuccessful foray lnLo
banklng ln Lhe 1990s 1he company sold conLrol of Slme 8ank ln 1999 afLer posLlng a loss of 3409
mllllon rlngglL Lhe prevlous year lLs flrsL deflclL ln Lwo decades
1he group wlll be reorganlzed sLarLlng !an 1 reverLlng Lo a prevlous sLrucLure where each dlvlslon
would be lLs own separaLe company Croup Chlef LxecuLlve Cfflcer Mohd 8akke Salleh Lold reporLers
on Aug 26
Pls predecessor Ahmad Zublr Murshld was removed when Lhe company reporLed lLs flrsL quarLerly
loss ln more Lhan a decade on May 27 afLer cosL overruns on Lhe Mlddle LasL pro[ecLs and Lhe 8akun
dam ln Sarawak
ulscloslng Lhe resulLs of Lhe lnvesLlgaLlon would have gone a long way ln provlng Lo lnvesLors LhaL
Slme ls serlous abouL belng more LransparenL and lmprovlng lLs corporaLe governance" Poe Lee
Leng an analysL aL 8P8 8esearch lnsLlLuLe Sdn sald ln a reporL Loday

kuALA LuMu8 Aug 3 CneLlme Malayslan lcon Lhe 100yearold Slme uarby 8erhad appears Lo
be ln a downward splral as lL faces huge losses agaln afLer Lhe lasL one 13 years ago wlLh Lop
offlclals belng Laken off from several unlLs
1be Moloysloo loslJet undersLands LhaL Lhe governmenL conglomeraLe wlll nexL monLh announce
LhaL poLenLlal losses could Lop 8M2 bllllon and go as hlgh as 8M23 bllllon MosL of Lhe losses are
down Lo llladvlsed lnvesLmenLs ln Lhe energy and uLlllLles secLor ln CaLar as well as Lardy buslness
pracLlces ln Lhe developmenL of Lhe 8akun dam ln Sarawak
1he lasL Llme Slme uarby saw red on lLs balance sheeLs came afLer Lhe 1997 Aslan llnanclal Crlsls
when a plunge ln Lhe sLock markeL and a sharp depreclaLlon of Lhe rlngglL led lLs flnanclal arm Slme
8ank Lo posL a 8M16 bllllon loss Lhe largesL ln Malayslan banklng hlsLory for Lhe slx monLhs Lo
uecember 1997 1he conglomeraLe wenL on Lo posL a slxmonLh loss of 8M6762 mllllon and closed
Lhe 1998 flnanclal year wlLh a neL loss of 8M3409 mllllon
lL ls also learnL LhaL properLy dlvlslon managlng dlrecLor uaLuk 1unku 8adllshah 1unku Annuar has
been removed from some unlLs wlLhln hls dlvlslon whlle oLher Lop offlclals are belng puL on noLlce
afLer Slme uarby lnsLrucLed former chlef execuLlve uaLuk Serl Ahmad Zublr Murshld Lo Lake a leave
of absence lasL May 13 ln relaLlon Lo Lhe losses
8uL hefLy losses and dlsclpllned offlclals aslde Lhe group could also face crlppllng bllllonrlngglL law
sulLs as lL moves Lo abrupLly end some of lLs [olnL venLures across Lhe globe
lL ls undersLood LhaL slnce belng
appolnLed as Lhe acLlng chlef execuLlve uaLuk 8akke Salleh has been looklng aL [olnL venLures
lnvolvlng Slme uarby argulng LhaL some of Lhese were noL as advanLageous Lo Lhe group as oLhers
and mooLlng LhaL Lhey be revlslLed or ended
1he only hlLch ls Lhls All Lhe venLures are legallyblndlng were agreed Lo and veLLed by Slme's legal
deparLmenL and glven Lhe green llghL by Lhe prevlous managemenL and Lhe board of dlrecLors A
couple of Lhe venLures even predaLed Zublr's Lenure as Lhe chlef execuLlve
Any move Lo end Lhese venLures ls llkely Lo seL off an expenslve legal baLLle for Slme uarby 1he
conglomeraLe could also have an embarrasslng faceoff wlLh Zublr Pe has been forced Lo go on
leave buL has noL qulL as Lhe chlef execuLlve
Along Lhe corrldors of Wlsma Slme uarby Lhere ls growlng bellef LhaL he wlll engage a lawyer Lo
proLecL hls lnLeresL and avold belng made Lhe scapegoaL for all Lhe problems aL Lhe conglomeraLe A
slugfesL ln courL wlll prove bloody for boLh Zublr and Lhe board of dlrecLors led by 1un Musa PllLam
buL lL could also have serlous repercusslons for Lhe 8arlsan naslonal (8n) governmenL
lL ls wldely known LhaL governmenLllnked companles someLlmes enLer lnLo deals aL Lhe behesL and
urglng of governmenL leaders and pollLlcal masLers
Cne of Lhe chlef concerns of lnvesLors on hearlng Lhe news LhaL 8akke has been selecLed Lo sLeady
Lhe llsLlng shlp aL Slme uarby was hls relaLlve lnexperlence ln runnlng a publlc llsLed enLlLy
Pe has helmed 1abung Pa[l and lelda where proflL maklng were noL Lhe prlmary ob[ecLlve ln boLh
Lhese organlsaLlons corporaLe soclal responslblllLy (CS8) ls a key ob[ecLlve and slnce occupylng Lhe
hoL seaL aL Slme uarby and meeLlng senlor offlclals Lhe vlew ln Lhe conglomeraLe ls LhaL corporaLe
soclal responslblllLy wlll en[oy equal bllllng wlLh proflL maklng news whlch may noL cheer lnvesLors
Cfflclals who have meL hlm descrlbe 8akke as drlven buL lmpulslve
Slme uarby closed aL 8M770 per share yesLerday falllng one sen from Lhe openlng prlce lL has losL
nearly some 8M6 bllllon ln markeL caplLallsaLlon slnce news of lLs Lroubles became publlc lasL May
13
ow Lnergy D|v|s|on Lead 1o Ma[or Losses Ior S|me Darby
Pow energy dlvlslon lead Lo ma[or losses for Slme uarby

1here are 4 mulLlmllllon 8lngglL pro[ecLs enLered by Lnergy and uLlllLles dlvlslon of Slme uarby buL
Lurned ouL bad Cne of Lhe pro[ecLs ls collaboraLlon wlLh CaLar eLroleum (C) Lhe 8ulhanlne and
Maydan Mahzam pro[ecL Slme uarby has been awarded a 8M263 mllllon conLracL Lo bulld
wellhead plaLforms where Lhe scope of works ln Lhe conLracL covers Lhree wellhead plaLforms
lnsLallaLlon of abouL 40 kllomeLres of plpellne 23 kllomeLres of umblllcal and alLeraLlon Lo exlsLlng
plaLforms lL sLarLed ln Aprll 2006 and supposedly compleLed ln AugusL 2008 Powever Lhe dlvlslon
has encounLered delays and cosL overruns whlch resulLed ln losses on Lhe pro[ecL exceedlng 8M300
mllllon whlch have already been accounLed for AL LhaL Llme Lhey sLlll Lry Lo negoLlaLe wlLh Lhe C
pro[ecL's cllenL on clalms for Lhe over budgeL cosL buL Lhe 8oard has already declded Lo reverse Lhe
revenue of 8M200 mllllon prevlously recognlzed ln Lhe Croup accounLs for llnanclal ?ear 2009
1he second pro[ecL ls Lhe Maersk Cll CaLar pro[ecL (MCC) Maersk Cll awarded Slme uarby
Lnglneerlng Lhe LClC conLracL Lo bulld and lnsLall a process plaLform a uLlllLy plaLform and Lhree
brldges off Lhe coasL of CaLar ln lebruary 2007 lL was scheduled for compleLlon ln CcLober 2009 buL
Lhere have been delays and cosL overruns ln Lhls pro[ecL whlch caused losses of 8M139 mllllon for
llnanclal ?ear 2010 Accordlng Lo Slme uarby Lhe cosL overruns were lncurred on LransporL and
lnsLallaLlon and hookup and commlsslonlng works lL ls noL clear lf Lhe overruns were Lhe resulL of
underbudgeLlng and unexpecLed lncrease ln raw maLerlal cosLs or boLh or some oLher reason
Lven Lhough negoLlaLlons were made wlLh Lhe cllenL Lhey sLlll could noL probe Lhe losses
1he Lhlrd pro[ecL relaLed wlLh Lhe MCC pro[ecL whlch ls Lhe consLrucLlon of vessels for Lhe MCC
pro[ecL's usage called Lhe Marlne ro[ecL MA8lnL ro[ecL was meanL Lo Lurn Slme uarby 8hd