Annual Report 2010/2011 - Ascendas

Transcription

For the past 10 years, it has been our
mission at Ascendas to deliver value
beyond expectations.
More than just living, more than just work,
more than just business – we see potential
in every square foot of space to add greater
joy, excitement and fulfillment to everyday
life. Which is why we are not just erecting
buildings, but creating lifestyles where
everything important comes together in
harmony. This is the essence of Ascendas’
Space To Be, and with this mission, we
continue our journey to more good years.
ASCENDAS ANNUAL REPORT 2010/11
For the past 10 years, it has been our
mission at Ascendas to deliver value
beyond expectations.
More than just living, more than just work,
more than just business – we see potential
in every square foot of space to add greater
joy, excitement and fulfillment to everyday
life. Which is why we are not just erecting
buildings, but creating lifestyles where
everything important comes together in
harmony. This is the essence of Ascendas’
Space To Be, and with this mission, we
continue our journey to more good years.
Contents
02 Looking Back On A Proud History
The full Annual Report and Financial Statements are available in the attached CD.
04 A Resounding Performance 06 Message from Chairman and President & CEO
08 Board of Directors 11 Senior Management Team 15 Country Operational Review 22 5 Years Financial & Operations Review
29 Unaudited Pro-Forma Financial Review 31 More Exciting Space To Come 34 Property Portfolio As At 31 March 2011
40 More Dedication to The Communities 43 More Energy Efficiency, Greater Sustainability 47 More Employee Engagement
49 More Ownership Of Risk Management 51 Report on Corporate Governance Practices
EXPECT MORE 10 YEARS OF ASCENDAS
ASCENDAS ANNUAL REPORT FY 10/11
Looking Back On A Proud History
Ten Years of Rewarding Achievements
June
February
Ascendas celebrates a
decade of success in
The Philippines with
plans for expansion of
its Philippine flagship,
Carmelray Industrial
Park (CIP) II.
November
January
02
Merger of Arcasia Land
and JTC International’s
Business Parks &
Facilities Group to
form a new entity,
Ascendas, to create a
stronger competitive
advantage as an Asian
real estate player.
October
Ascendas breaks
ground for the S$45
million CyberPearl,
a new IT complex in
Hyderabad, India.
2001
Ascendas Real Estate
Investment Trust
(A-REIT) lists on the
Singapore Exchange.
As Singapore’s first
business and industrial
property trust, A-REIT
receives overwhelming
demand at five times
oversubscribed.
December
Ascendas’ iconic
flagship in India,
International Tech Park
Bangalore, named
World Teleport Property
of the Year 2002.
2002
July
June
Ascendas partners
with Tamil
Nadu Industrial
Development
Corporation (TIDCO) in
India to develop an IT
complex in Chennai.
2003
June
September
Ascendas and
Dalian Software Park
launch 35-hectare
Dalian Ascendas IT
Park, comprising 7
high-grade office
buildings and a central
amenities hub.
Ascendas acquires
new integrated hitech office complex,
Ascendas iHub Nanjing,
in China.
November
April
Ascendas launches
its first commercial
building in China,
Ascendas Plaza.
2004
Ascendas marks
successful decade
in China - Plans
expansion with
10th Anniversary of
Ascendas-Xinsu.
2005
October
Ascendas celebrates
the completion and
opening of Biopolis
Phase II. Named Neuros
& Immunos, the
complex opens with
strong interest from
research institutions and
biomedical companies.
2006
Ascendas partners the
Hangzhou government
to develop a S$700
million science and
technology park.
Singapore’s first listed
India property trust,
Ascendas India Trust,
launches initial public
offering in Singapore
to overwhelming
response. In October,
the trust wins SIAS’
Most Transparent
Company Award in the
New Issues category.
2007
April
Ascendas invests
in North India with
proposed integrated
development project in
Gurgaon.
October
Ascendas launches
iHub Suzhou, a
33-hectare integrated
park project in Suzhou.
December
Ascendas awarded
a JTC tender for the
development of Changi
City, an integrated
business park
development with retail
and hotel elements at
Changi Business Park.
2008
The SingaporeHangzhou Science &
Technology Park in
the Zhejiang capital
is officially opened
by the Prime Minister
of Singapore, Mr Lee
Hsien Loong.
September
October
Ascendas completes
13 buildings with a
total GFA of 340,000
sqm in a single year in
Singapore, China and
the Philippines.
November
As a partner to the
APEC CEO Summit
in November 2009,
Ascendas welcomes
world leaders, global
CEOs and delegates
visiting Singapore,
including the President
of China, Mr Hu Jintao.
2009
May
Ascendas clinched two
awards at the 2010
Cityscape Asia Real
Estate Awards.
Dalian Ascendas IT Park
in China came out
tops in the “Best Urban
Design and Master
Planning” category and
Citi at 3 Changi Business
Park Crescent in
Singapore emerged as
the winner in the “Best
Green Building (Built)”.
2010
Ascendas China
Commercial Fund
acquires its third Grade
A commercial building,
the 24-storey Cross
Tower located within
the prime Huangpu
central business district.
October
Ascendas won regional
recognition for its
green efforts at The
Emerson Cup 2010
(India & Southeast Asia)
held in Chennai, India.
The chiller upgrading
project at the Galen
building in the
Singapore Science Park
received the Excellence
Award under the
Retrofit category.
03
February
Ascendas breaks
ground for Infinite
Studios, Singapore’s
first building specially
customised to cater
to the needs of the
media industry at
Mediapolis@one-north.
2011
A Resounding Performance
Highlights Of FY10/11
Total Space Managed at March 2011
49.8 million square feet
Total Assets Under Management at March 2011
S$11.1 billion
04
Total Profits Before Tax for year ended 31 March 2011
S$225.2 million
Total Profits After Tax Attributable to Shareholders for the year ended 31 March 2011
S$191.0 million
5 Years Rolling Average ROIC
9.9%
5 Years Rolling Average Return on Shareholder’s Fund
11.1%
FREEDOM
Inspiring Excellence
Introduction
On behalf of the Board of Directors
of Ascendas Pte Ltd, we have the
pleasure of presenting the annual
report and the audited financial
statements of the Company and
its subsidiaries (The Group) for the
financial year ended 31 March 2011.
FREEDOM
06
Space is not just there to be occupied, which is why
we give you all the room you need to fulfill all that you
want your life to be. That simply means giving you more
freedom to pursue your interests, in and out of work.
8th of January 2011 is an important
milestone for Ascendas as it marks its
10th anniversary. The Group, which
had started with an equity capital of
circa S$900 million, has grown to S$1.7
billion in net asset value (S$2.7 billion
on a fair value basis). Over the course
of 10 years, it has also distributed more
than S$250 million in dividend to its
shareholder, JTC. The total return to the
shareholder is approximately 12% of
compounded annual growth. Assets
under management (AUM) has also
increased six-fold, from S$1.7 billion to
S$11.1 billion today.
FY10/11 – Solid Performance and
Strategic Repositioning
2010 was a year of rapid growth in the
Asian economies, emerging relatively
unaffected by the concerns over the
United States’ weak unemployment
situation, the Eurozone debt crisis
and the social political unrest in the
Middle East. Ascendas’ key markets
such as Singapore, India and China
recovered rapidly, registering high
GDP growth.
Coming off the earlier uncertain
economic period that temporarily
stalled growth in 2009, The Group
was able to ride with the strong
economic recovery to deliver a strong
performance. Singapore continued
to be our major performance
contributor. The Group continues
to spearhead new development
initiatives in Singapore. The
Mediapolis project, a joint venture
with Citramas Nusattera which will
house Singapore’s first sound stage,
is a case in point. In the meantime,
the development at Changi City, an
integrated development comprising
business space, retail mall and a hotel,
is progressing well with the retail
mall expected to be completed in
the second half of this year. A-REIT,
the listed REIT vehicle managed by
Ascendas Fund Management, made
its maiden investment outside of
Singapore, investing in a business
park development located at Jinqiao
Export and Processing Zone, Pudong
New District in Shanghai, China, for
about S$120 million.
8th of January 2011
is an important
milestone for
Ascendas as it marks
its 10th anniversary.
Assets under
management (AUM)
has also increased
six-fold, from
S$1.7 billion to
S$11.1 billion today.
Our India operations continued
to expand in its existing key
locations. During the last three
years, our private equity fund
management platform, Ascendas
India Development Trust raised its
land bank and over the last year, has
commenced development in several
of its sites. Work has commenced
in Gurgaon and Pune, and several
other new sites are expected to be
launched in the next 18 months.
A-iTrust also made its first acquisition,
with approximately S$250 million
investment in Hyderabad.
In China, we further consolidated
our position in several key locations.
Most notably, the management
reviewed its product offerings in
Dalian, Hangzhou and Suzhou,
pushing the planning and
development envelope to create
more comprehensive integrated
community type development.
These design revamps are already
beginning to show fruits with the
Dalian re-master plan winning the
2010 Cityscape Asia Real Estate
Awards - “Best Urban Design and
Master Planning” category. During
the year, the two Ascendas’ China
private funds platform made
acquisitions in a Grade A commercial
building in Shanghai, Cross Towers
and a business park development in
Beijing, Z-Link. These acquisitions
also mark the end of the funds’
investment period and Management
will be evaluating exit options with
its various investors in due course.
In 2010, Management had, after
engaging the Board, undertaken
a comprehensive review of its
competitiveness and formulated
strategies for its next phase of growth.
This had led to the development
of the Integrated Communities
concept and Customer Solutions
approach to meeting the needs of
its customers. This also entailed a
fairly substantial restructuring of the
business organisation, revamping
of its processes, and building new
capabilities to realise this new vision.
On behalf of the Board, we wish to
congratulate the management team
for undertaking these major revamps
during the course of the year, a
journey that has just only begun. We
believe this will put The Group in good
and solid foundation to meet the new
challenges of the ever competitive
market place, and see it grow even
faster and more sustainably.
Corporate Social Responsibilities
Whilst we pursue our economic
interest, we have not forgotten
the communities around us. Our
employees have come together
voluntarily again and again to help
with social causes and programs that
alleviate the plight of the less privileged
and victims of natural disasters. The
Group and its employees were quick to
respond in the recent call to contribute
to the Fukushima disaster by passing
the hat around for donations, which the
Company matched in equal amount.
These and many other exemplary acts
of goodwill and human kindness augur
well for The Group, and will ensure that
while we grow, we will stay connected
and committed to the communities
around us.
Outlook
There is no doubt that volatilities will
continue to exist with the ongoing
uncertainties arising from the unrests
in the Middle East, economic fallout
from the March 11 earthquake in
Japan and potential worsening of
Europe’s sovereign debt problems,
although the consensus forecasts for
2011 is an optimistic one with steady
growth forecasted, particularly for Asia.
This growth outlook, however, can
potentially change rapidly if the
spiraling oil prices inject more shock
to the global economies. The rising
inflation felt in many economies that
we are operating in will be one of our
main concerns. Already, we are seeing
prices moving up across the board (i.e.
commodities, components, labour, and
power). While we remain committed in
spending today to invest for the future,
it remains essential for Management to
play the fine balancing act in keeping
costs increases reasonable whilst
continuing to maintain and bring the
quality of our service and products to
the next level through innovation.
As The Group executes its Integrated
Community and Customer Solutions
strategies, we will be introducing to our
customers a new generation of exciting
business space solutions in the near
future. The next generation of total
business environments will not only
be integrated, but will also be green,
chic and sustainable, and stay true to
our mission of inspiring excellence.
We look forward to the delivery of this
new product, which we hope will also
redefine the lifestyle experience in the
workspace environment.
In closing, we take this opportunity to
thank our shareholders, JTC, the parent
company for its strong support, our
employees for their continued efforts
and commitment, the management
team for its courage to reinvent the
business, and finally our fellow directors
who have selflessly contributed so
much time in the last 12 months.
As the business embarks on numerous
programs to pursue the next phase
of growth for The Group, we will
continue to build on our strong
foundation and remain committed to
continue our legacy of excellence.
Mr Lim Hock San
Chairman
Ms Chong Siak Ching
President & CEO
Message from Chairman and President & CEO
07
Strong Leadership, Wealth of Experience
MR LIM HOCK SAN
Chairman of the Board
MR MANOHAR KHIATANI
Director
MS CHONG SIAK CHING
Director
MR WILLY SHEE
Director
MR TAN GEE PAW
Director
MR CHEE HONG TAT
Director
Mr Lim Hock San is the President and
CEO of United Industrial Corporation
Ltd (UIC) and Singapore Land Ltd
(Singland). He was formerly the
Director-General of the Civil Aviation
Authority of Singapore from 1980 –
1992, where he actively participated in
the feasibility, siting, development and
operations of Singapore Changi Airport,
as well as managed the transition from
the old Paya Lebar Airport to the new
Changi Airport.
Mr Manohar Khiatani is the CEO of
Jurong Town Corporation (“JTC”).
JTC is the Government’s lead agency
to plan, promote and develop key
industrial infrastructure and facilities,
in support of the nation’s economic
development. Prior to JTC, Mr Khiatani
was Deputy Managing Director at the
Economic Development Board (EDB).
He joined the EDB in 1986 where he
played an instrumental role in the
development and transformation
of important sectors in Singapore’s
economy such as electronics,
transport engineering, precision
engineering, logistics, infocomms and
media, and clean technology. He was
also in charge of EDB’s operations in
the Americas and Europe.
Ms Chong is the President and CEO of
Ascendas Pte Ltd. A board member of
Ascendas Pte Ltd and its subsidiaries,
she holds several external
appointments. These include Deputy
Chairman of Spring Singapore, the
enterprise development agency of
Singapore, as well as an Independent
Director on the Board of Singapore
Press Holdings. She is also a board
member of Jurong Health Services
and a member of the National
University of Singapore (NUS) Board
of Trustees. Previously JTC’s Deputy
CEO, she has extensive experience in
business space management.
Mr Willy Shee is the Chairman, Asia,
of CB Richard Ellis (Pte) Ltd. He also
holds several other appointments
with the Singapore Chinese
Chamber of Commerce and Industry,
Supreme Court Inquiry Panel, Real
Estate Developers’ Association of
Singapore, and the Lions Club of
Singapore Jurong. He is a director
in many organisations including
Bund Centre Investment Ltd,
NTUC Fairprice Co-operative Ltd,
Strategic Partners Asia II Pte Ltd, SLF
Properties Pte Ltd and Sunway REIT
Management Sdn Bhd.
Mr Tan Gee Paw was appointed
Chairman of the PUB, Singapore’s
national water agency on 1 April 2001.
He is also chairman and director of a
number of companies, and a member
of several committees. He has been a
member of the Presidential Council for
Religious Harmony since September
2005. Previous appointments held
by Mr Tan were Principal of Ngee Ann
Polytechnic, and Permanent Secretary of
the then Ministry of the Environment.
Mr Chee Hong Tat is Chief Executive
at the Energy Market Authority.
Before being appointed to his present
post, he was the Principal Private
Secretary to Minister Mentor Lee
Kuan Yew from 2008 to 2011.
He sits on the board of Keppel
Corporation Ltd and is the Chairman of
Gallant Ventures Ltd and the National
Council on Problem Gambling. Mr
Lim received his Masters of Science
from the Alfred P Sloan School of
Management of Massachusetts
Institute of Technology (MIT), USA in
1973. He also attended the Advanced
Management Program at the Harvard
Business School and the Senior
Executive Program of the London
Business School. He is a Fellow of the
Chartered Institute of Management
Accountants, UK, and a Fellow and past
President of the Institute of Certified
Public Accountants of Singapore.
He is also a Justice of Peace and was
awarded the Singapore Government
Meritorious Service Medal, the Public
Administration Medal (Gold) and the
Public Service Medal.
Between 1994 and 1999, Mr Khiatani
worked in the private sector when
he was the Managing Director of
German conglomerate Preussag
SEA. Mr Khiatani, a Singapore
Government Scholar, holds a Masters
Degree (Naval Architecture) from the
University of Hamburg, Germany.
He also attended the Advanced
Management Program at the
Harvard Business School in 2006. He
is currently also a board member of
JURONG International Holdings Pte
Ltd and Jurong Port Pte Ltd.
Ms Chong graduated from the NUS
with an Honours Degree in Estate
Management and was awarded
a Gold Medal by the Singapore
Institute of Surveyors and Valuers.
She also has a Masters in Business
Administration from NUS. Ms
Chong completed the Advanced
Management Programme at Harvard
Business School. She was conferred
the NUS Distinguished Alumni
Award by the Faculty of Architecture
and Building Management in 1999
and the NUS Distinguished Alumni
Service Award in 2009. Ms Chong was
also recognised as the ‘Outstanding
CEO of the Year’ in the Singapore
Business Awards 2009.
A Colombo Plan Scholar, Mr
Shee graduated in 1970 from the
University of Auckland, New Zealand,
with a Diploma in Urban Valuation.
He is an Associate Member of the
New Zealand Property Institution,
Fellow Member of the Singapore
Institute of Surveyors and Valuers
and Association of Facilities and
Property Management. Mr Shee was
awarded the Friend of Labour Award
by NTUC in May 2007.
Mr Tan graduated with First Class
Honours in Bachelor of Engineering
(Civil) from the University of Malaya
in 1967. In 1971, he obtained a Master
of Science in Systems Engineering
from the University of Singapore. He
was conferred an Honorary Degree of
Doctor of Science from the University
of Westminster, UK in 1993; and an
Honorary Doctorate in Engineering
from Sheffield University, UK in 1995.
In 1978, Mr Tan received the Public
Administration Medal (Silver), and
in 2001, the Meritorious Service
Medal. He also received a Special
Award (Gold Medal) for Clean River
Commemoration in 1987. He received
the Medal of Commendation at the
NTUC May Day Award in 2005, and the
President’s Award for the Environment
in 2007. Mr Tan was also bestowed the
Distinguished Service Order in 2010.
He joined the Administrative Service
in 1998 as Assistant Director of
Human Resource Planning in the
Ministry of Home Affairs. He was
subsequently posted to the Ministry
of Finance from 2000-2003 where he
was Head of Regulatory Services and
Secretary to the Council on Corporate
Disclosure and Governance. From
2003-2005, he was Deputy Director
for Sea Transport and Head of
Strategic Planning in the Ministry of
Transport. He served in the Ministry
of Education as Director of Planning
from 2006-2008.
Mr Chee studied at the University of
California at Berkeley on an Overseas
Merit Scholarship, and graduated
in 1996 with a Bachelor of Science
(Highest Honours) in Electrical
Engineering & Computer Sciences and
a Bachelor of Arts (Highest Honours) in
Economics. He obtained a Masters of
Business Administration from Adelaide
University in 2006, and was awarded
the Newmont Australia Prize for Most
Outstanding MBA Graduate.
08
Board of Directors
09
10
Senior Management Team
Strong Leadership, Wealth of Experience
MR REGGIE THEIN
Director
MR CHARLES CHEN
Director
MR LEE ENG BENG
Director
Mr Reggie Thein is a board
member of Ascendas Pte Ltd
and he is Chairman of the audit
committee. He is a director of
United Overseas Bank Limited, a
board member and Chairman of the
audit committees of several listed
companies in Singapore, among
them Haw Par Corporation Limited,
GuocoLeisure Limited, MobileOne
Ltd, Keppel Telecommunications &
Transportation Limited, GuocoLand
Ltd, FJ Benjamin Holdings Ltd and
Otto Marine Limited.
Based in Taiwan, Mr Charles Chen is
a highly respected corporate figure
in the local community with many
years of experience in technology,
financial services, insurance and
transportation management. He is
the Chairman of Eyon Holding Group
and also Vice-Chairman of Taiwan
Air Cargo Terminal Corporation and
Taiwan Insurance Co Ltd. In addition,
he is a board member of China
Airlines and holds many other local
and foreign directorships.
From 1998 to date, Mr Lee Eng Beng
has been a partner at Rajah & Tann
LLP. From 2003 to 2009, he headed
the firm’s Business Finance and
Insolvency Practice Group, with a
strong focus on banking, insolvency
and commercial litigation. He
continues to be active as counsel
and advisor to banks and financial
institutions, insolvency practitioners,
and distressed companies, as well as
commercial litigation and arbitration.
He was appointed Senior Counsel
in 2008 and the Deputy Managing
Director of Rajah & Tann LLP in 2009.
Mr Thein is a member of the
Governing Council and ViceChairman of the Singapore Institute
of Directors, a Fellow of the Institute
of Chartered Accountants in
England and Wales, and member
of the Institute of Certified Public
Accountants of Singapore. He
was previously a senior partner of
PricewaterhouseCoopers, ViceChairman of Coopers & Lybrand,
and Managing Partner of its
management consulting services
firm. In 1999, he was awarded
the Public Service Medal by the
President of Singapore.
Mr Chen was previously Chairman of
the UTAC Group, the world’s number
5 semiconductor backend services
provider, and also the Chairman of
Epistar Corporation, a world leader
in LED chips. He is Co-President of
Chen Yung Foundation and Director
of Formosa Cancer Foundation in
Taiwan. He is also a board member
of several non-profit organisations
including the Children Liver
Foundation, Earth’s Love Foundation
and Taiwan Orthopedic Sports
Medicine Research Foundation.
Mr Chen has a Masters in Business
Administration (MBA) from New
York University and a Bachelor of
Economics from Fu-Jen Catholic
University in Taiwan.
Mr Lee graduated with First Class
Honours in Law from the National
University of Singapore in 1992. He
then served as a Senior Tutor with the
Faculty of Law in NUS and a Justices’
Law Clerk in the Supreme Court of
Singapore. In 1994, he obtained the
Bachelor of Civil Law postgraduate
degree from Oxford University, with
First Class Honours. He then served as
a lecturer in the Faculty of Law in NUS
from 1994-1998.
MS CHONG SIAK CHING
President & CEO
(Pls see Board of Directors)
MR CHIA NAM TOON
Group CFO, Group Finance
EVP, Enterprise Risk Management
As the Group CFO, Nam Toon takes care
of Ascendas’ finance organisation and
providing strategic financial leadership
for the Group. These include formulating
financial policies, strategies and plans,
and overseeing the financial and
reporting functions. He is concurrently
the Executive Vice-President of
Enterprise Risk Management and
oversees the risk management across all
functions in the Ascendas Group.
MR TAN SER PING
CEO, Ascendas Funds
Management Singapore Pte Ltd
(trustee-manager of Ascendas
Real Estate Investment Trust)
Ser Ping is the CEO of Ascendas Funds
Management Ltd, the manager of listed
Ascendas Real Estate Investment Trust
(A-REIT). He was formerly Ascendas’
Executive Vice-President of Real Estate
Development & Investment (REDI).
MR JONATHAN YAP
CEO, India Funds
CEO, Ascendas Property Fund Trustee
(trustee-manager of Ascendas
India Trust)
EVP, Real Estate Funds
Jonathan is CEO of India Funds,
including the Ascendas India
Development Trust (private fund)
and Ascendas India Trust (listed
on SGX-ST). He is concurrently the
Executive Vice-President, Real Estate
Funds, focusing on forming new
private funds for the Ascendas Group
across Asia and developing business
synergy across these funds.
MR TAN YEW CHIN
CEO, Ascendas Land (Singapore)
EVP, Real Estate Services
As the CEO of Ascendas Land
(Singapore), Yew Chin looks after
the Singapore country operations
in the business development,
business networking and the
incubator functions.
MR TAY ENG KIAT
CEO, Ascendas Services
(Singapore)
WONG WING KIEN
CEO, Ascendas China
Eng Kiat is the CEO of Ascendas
Services (Singapore), responsible
for development & project
management, property & facilities
management as well as lease
management of Ascendas’
Singapore properties.
Wing Kien is the CEO of Ascendas
China, responsible for developing
and managing the Ascendas
property portfolio in China and
formulating the overall China
strategy. These include developing
new products and opening new
markets in Chinese cities.
MR THOMAS TEO
CEO, Ascendas India
MR LEE HO-GIL
CEO, Ascendas Korea
Thomas is currently CEO of
Ascendas India, managing Ascendas’
business in India. This includes the
development and management of
an IT Park portfolio across several key
Indian cities, as well as its activities
and expansion in this key market.
Ho-Gil is the CEO of Ascendas Korea,
looking after the development
and management of the Ascendas
portfolio in Korea and formulating
the overall Korea strategy.
11
MR LOH WAI KEONG
CEO, Ascendas South East Asia
EVP, Real Estate Development
& Investment
12
Wai Keong is the CEO of Ascendas
South East Asia with a portfolio
that includes Malaysia, Philippines
and Vietnam. He is concurrently the
Executive Vice President for Real
Estate Development & Investment,
which encompasses the development
and identification of investment
opportunities in new markets and
products for the Ascendas Group.
MR LIM SIN TIOW
EVP, Real Estate Services
Sin Tiow is the Executive VicePresident of Ascendas’ Real Estate
Services overseeing the Group’s real
estate service functions which include
project and property management.
MR AYLWIN TAN
Chief Customer Solutions Officer
Aylwin is the Chief Customer
Solutions Officer. He is responsible for
formulating and executing marketing
and customer engagement strategies
for the Ascendas Group.
MR ARTHUR AW
Chief Development
Planning Officer
MS MARY J. DE SOUZA
SVP & Head, Group Legal &
Corporate Secretariat
MS CRYSTAL SEAH
SVP & Head, Group
Communications
Arthur is the Chief Development
Planning Officer for Ascendas
Group, responsible for the spatial
planning and design strategy of all
Ascendas development projects.
He is concurrently the Chief
Development Officer for China Ops,
Dalian, overseeing the investment,
development and management of
Ascendas’ property portfolio in the
city of Dalian.
Mary heads the Group Legal
& Corporate Secretariat which
handles legal issues affecting the
Group, including transactional and
operational matters, corporate
governance and legal risk
management.
Crystal heads the Group’s regional
communications function which
includes formulating regional strategies
and policies for corporate and
marketing communications, brand
management, internal communications
and crisis management.
MR LIM YEW TECK
SVP & Head,
Group Information Technology
MRS LORRAINE NG
SVP & Head, Group Human
Resources & Administration
Yew Teck heads the Group’s
regional IT function which
encompasses regional IT strategies,
governance, infrastructure and
enterprise systems.
Lorraine heads the Group Human
Resources and Administration
function which includes formulating
HR strategies and policies,
overseeing manpower planning and
providing guidance and strategic HR
direction to overseas operations.
MR JAMES TAN
SVP & Head,
Group Strategy Management
James heads the Group Strategy
Management function which
includes directing and managing the
group’s strategic planning, research
and corporate initiatives to enhance
Ascendas’ business effectiveness.
SPACE
From left:
Changi City and
Plaza 8 at Changi
Business Park
Singapore
FY10/11 saw several exciting new
developments for The Group’s
operations in Singapore.
In March 2011, The Group was
successfully awarded the tender for
Biopolis Phase 5. The 46,000 sqm
development is a multi-tenanted
facility dedicated to biomedical
R&D and will be The Group’s second
development in the Biopolis@onenorth. Construction is expected to
commence by the 4th quarter of 2011.
SPACE
Success is all about the right time, the right people and
of course, the right place. Providing the right space
from small medium enterprises to large multi-national
corporations, we make sure that our space empower
companies with vision and room to grow.
The Group also entered into a joint
venture with Citramas Nusaterra to
develop Singapore’s first dedicated
multi-tenanted development for
media companies at Mediapolis@
one-north. Named Infinite Studios,
the development will host Singapore’s
first fully operational soundstage and
supporting facilities to support high
quality media productions, especially
films with high digital content and
strong visual effects. The building
is scheduled for completion by 3rd
quarter of 2012.
Biopolis Phase 5, one-north, Singapore
At Changi Business Park, Changi
City, Singapore’s largest integrated
business park development comprising
business space, retail mall and hotel,
is fast shaping up to be an exciting
and vibrant destination. The 28,000
sqm retail mall within Changi City
is scheduled for completion by 3rd
quarter of 2011. The construction of the
313 room boutique hotel residence and
the 71,000 sqm business park building
has commenced and is expected to
be completed by end 2012. Half of the
space in the business park building,
named One@Changi City, has been
pre-leased to Credit Suisse.
Complementing the real
development business in Singapore
is The Group’s services arm in
Singapore, which provides a host of
expertise and services for both The
Group and external property owners
ranging from:
At the Singapore Science Park, our
revitalization plan is underway. The
redevelopment of the 4 first generation
research buildings, namely Mendel,
Maxwell, Pascal and Pasteur, at Science
Park I will commence soon. The
redevelopment will generate total
floor area of about 80,000 sq metres to
house 2 anchor tenants who have preleased the entire space.
•
•
•
•
•
•
Property and Maintenance
Management;
Project Management (Build To
Suit, Build & Lease-Back);
Asset & Lease Management
(Property Tax / Arrears
Management, Lease
Administration, Customer
Relationship Programmes);
Marketing cum A&P services;
Car Park & Integrated Facilities
Management;
Fit Out/renovation works, Energy
& Building Audit
At 31 March 2011, the Singapore
services arm manages 131 buildings
(3.02m sq m), more than 1,500 leases
and 62 carparks.
Over at our listed entity, A-REIT,
FY10/11 full year distribution increased
by 5.6% y-o-y to S$248.0 million, while
net revaluation gain of S$345 million
was registered. Strong portfolio
performance was also registered,
with portfolio occupancy at 96% at 31
March 2011. In line with the optimistic
economic outlook for Singapore,
positive rental reversion of between
2.1% and 6.7% was achieved across
Business & Science Parks, Hi-Tech
Industrial and Logistics sector, and
17.2% improvement in new take up
rates for Science & Business Park versus
a year ago were recorded.
Country Operational Review
15
From left:
International Tech Park Bangalore,
Ascendas Onehub
Gurgaon
India
16
The Group’s operations in India see
us managing over 6.5 million sq ft
of space with an occupancy rate of
96% at 31 March 2011. This includes
4 iconic properties in our listed unit,
a-iTrust, namely International Tech Park
Bangalore (ITPB), International Tech Park
Chennai (ITPC), the V and CyberPearl in
Hyderabad. These parks are integrated
with social infrastructure such as retail,
food & beverage, hospitality and
other amenities.
In ITPB, Ascendas Park Square, a
450,000-sq ft retail mall, a first for The
Group, was completed in December
2010. With this addition, we expect
to further enhance the uniqueness
of our integrated IT Parks to our
customers. In addition, the new
Voyager building within ITPB Special
Economic Zone (SEZ), expected
to be completed by mid 2011, will
add another 540,000 sq ft to The
Group’s portfolio. The Park has also
commissioned the development of
its second 20 MW power plant, in
keeping the requirement of its 26.8
acres SEZ.
In ITPC, the addition of the
new Zenith building also marks
the completion of the project
development under a-iTrust.
The Group’s various new
development projects are also
moving in tandem with the improved
market conditions. Construction
has commenced for International
Tech Park Pune, our first IT SEZ Park
in Maharashtra. The construction of
the first phase of Ascendas OneHub
Gurgaon in 2010, signaled the start of
our first integrated project in North
India. The master plan and schematic
design for International Tech Park
Gurgaon is also currently underway.
In ITPB, Ascendas
Park Square,
a 450,000-sq ft
retail mall, a first
for The Group,
was completed in
December 2010.
With this addition,
we expect to
further enhance the
uniqueness of our
integrated IT Parks
to our customers.
Both projects in Gurgaon come
under our private fund, Ascendas
India Development Trust (AIDT).
In November 2010, The Group also
inked an MOU with a Japanese
Consortium, formed by top corporate
finance provider, Mizuho Corporate
Bank and program management
contractor & investment partner,
JGC Corporation, to jointly
explore opportunities for business
partnership and collaboration in
a large scale project to develop a
world-class integrated township in
Chennai, India, with eco-friendly
infrastructure for industrial, business,
commercial, residential, and lifestyle
amenities with The Group as the
Master Developer.
17
Crest at International Tech Park Chennai
China
18
In China, our presence is spread
over 10 cities. During the year, with
the acquisition of Ascendas Cross
Tower, a Grade A commercial cum
retail building in Shanghai, the total
gross space managed approximates
900,000 sqm. Our portfolio also
includes industrial parks, IT parks,
logistics facilities, science and
business parks. The occupancy rate
for the entire portfolio was 80% as
at 31 March 2011.
China is a key geography for The
Group’s implementation of its
Integrated Community strategy. In
Dalian, the masterplan to convert
Dalian Ascendas IT Park (DAITP) into
an Integrated Community received
the Best Urban Design and Master
Planning Award by Cityscape Asia in
May 2010. This project, scheduled to
be completed by 2012, will feature
a new leisure hub for knowledge
professionals in IT, BPO and R&D to
Singapore-Hangzhou Science & Technology Park, China
work, live and play within a socially
integrated community.
Two other Integrated Community
projects, Singapore-Hangzhou
Science and Technology Park
(SHSTP) and iHub Suzhou, have also
put their master plans through local
government approval process.
During the year, The Group
participated in the Singapore
Consortium comprising of Temasek,
Sembcorp Industry, Keppel Corp
and Ascendas to be the master
developer for a 10 sq km SingaporeSichuan Hi-Tech Innovation Park
(SSHIP), Chengdu, where The Group
will take the lead in industry and
master planning. An MOU has also
been signed with SingBridge and
Guangzhou Development District
for the collaboration in Guangzhou
Knowledge City to develop an
Integrated Community.
China is a key
geography for
The Group’s
implementation
of its Integrated
Community strategy. In Dalian, the
masterplan to convert
Dalian Ascendas IT
Park (DAITP) into an
Integrated Community
received the Best
Urban Design and
Master Planning
Award by Cityscape
Asia in May 2010.
From left:
Dalian Ascendas IT Park,
Ascendas iHub Suzhou
19
Ascendas-Protrade
Singapore Tech Park
From left:
West Finance Centre,
Signature Towers Seoul,
ACCRALAW Tower
Management believes in the potential for
further growth in Vietnam and will continue
to deepen The Group’s presence in the
country, particularly in the execution of
the integrated business concept.
Korea
20
Ascendas Korea invests in and
manages 2 Office Real Estate
Funds and 1 Logistics Real Estate
Fund. Through these funds, our
investment portfolio includes
4 office buildings and 1 logistic
warehouse with a total GFA area of
approximately 153,000 sqm.
Capitalising on our real estate expertise
to enhance asset value, Ascendas
Korea achieved significant financial
success by increasing occupancy and
savings in operating expenses and
finance charges. At 31st March 2011, the
occupancy rate for the portfolio stood
at 99%, compared to 88% a year ago.
Tenant retention rate was 98%, amid a
highly competitive market with high
tenant turnover.
Construction of the 100,000 sq metres
Signature Towers Seoul (STS), a Grade
A integrated office-cum-retail Platinum
level Green Mark building, is smoothly
underway and is expected to be
completed in July 2011, as scheduled.
Strategically located at the centre
Korea’s business district at JungGu, Seoul, STS faces the Chunggye
Stream and Mt Namsan and will be
a prestigious business venue upon
its completion. We are in advance
stage of leasing out 60-70% of the
property space with an anchor tenant.
Preliminary negotiations are also
under way for another 20%-25% of the
leasable space.
With the various value enhancement
initiatives on the ground, Korea
Operations will continue to establish a
solid foothold as one of the best asset
managers, and position us well as we
engaged in other larger investment
activities in the country.
The Philippines
Despite only a small team of less than
20 staff, Ascendas’ operations in The
Philippines has grown the AUM from
S$60-million in 2001 to S$114 million
in 2011.
Carmelray Industrial Park II, a
145-hectare industrial located in the
Special Economic Zone in Calamba
City, Laguna, is The Group’s flagship
project in the Philippines. Within
the park, Ascendas owns and leases
23 ready-built facilities (RBFs) to
Japanese, Korean, US, European and
local manufacturing and industrial
companies. Ascendas has enjoyed
continued patronage for its RBFs. The
average occupancy rate at the end of
March 2011 is 98%.
ACCRALAW Tower, a 26-storey modern
IT building, is The Group’s first office
tower development. Completed in
2010, it is located in Bonifacio Global
City, Metro Manila’ newest CBD.
18,000 sqm GFA has been fully leased
out to many traditional, IT and BPO
companies like Tata, Maybank, Raffles
Design and Yahoo!.
The demand for office space in The
Philippines came primarily from the
BPO sector in 2010 and the trend is
expected to continue with offshoring and outsourcing being the
driving factors in 2011. The Group will
continue to capitalize on the growth.
Plans for new developments in The
Philippines include:
Ascendas Business Park, a 40 hectare
integrated community adjacent to a
renowned golf course within in Metro
Manila’s bustling southern area; and
Ascendas Tower 2, a 30-storey office
tower with GFA of 32,000sqm within
the center of Bonifacio Global City.
Malaysia
Since The Group’s entry into the
Malaysian real estate market in 2007, we
have accumulated a modest portfolio
of assets. These include:
Peremba Square, a business park in
Subang with NLA of 247,000 sq ft. A
high quality office park located within
the Saujana Resort, The Group owns
5 of the 7 buildings in the Park and
actively enhances the value of the asset
through upgrading works. Occupancy
at 31 March 2011 is 85%.
Logistics Hub in Subang Jaya, The
Group’s first development project
in Malaysia. Completed in 2008, it
comprises 3 terraced units of about
127,000 sqft of warehouse and logistic
spaces. It has maintained 100%
occupancy since 2009 despite the
2008/09 financial crisis.
The Cyberjaya development land,
a prime 7 acre, freehold site with
frontages to busy roads on all sides.
Cyberjaya is evolving from a quiet IT
hub into a bustling township with
major fast-food brands and premium
residential developers setting up shops
in the enclave. To capitalise on this as
well as our site’s prime location, an
integrated F&B-themed commercial and business suites development is
currently being proposed for the site.
Vietnam
Our investment in Vietnam, AscendasProtrade Singapore Tech Park, is a
500-hectare industrial park sited in the
province of Binh Duong, Vietnam. It
is a joint venture development with a
local state owned enterprise, Protrade
Corporation. This project targets mainly
companies operating in the light and
clean manufacturing industries and
has attracted interests from both
local and foreign entities, particularly
Japanese and American companies.
Constructions of infrastructure works
for Phases 1 and 2 are ongoing and are
expected to complete in early 2012.
Management believes in the potential
for further growth in Vietnam and
will continue to deepen The Group’s
presence in the country, particularly
in the execution of the integrated
business concept.
One of the differentiating factors of
this high tech park is the clustering
of manufacturing activities spanning
the whole value chain for targeted
promising industries as well as the
provision of supporting and essential
facilities (like Ready-Built Facilities,
domitories, amenity centres, waste
water treatment, etc.) to facilitate a
sustainable industry growth.
21
Income Statement
Balance Sheet
(For the year ended 31 March)
(As at 31 March)
(S$ m)
22
Revenue
Profit before other gains, finance expense, share of profits from associates & joint ventures, tax and minority interest
Other gains/(losses) – net
Finance expense
Share of profits from associates & joint ventures
Profit before income tax and impairment
Asset (impairments)/write-backs
Profit before income tax
Income tax expense
Net profit
Available-for-sale financial assets – fair value (losses)/gains
Available-for-sale financial assets – reclassification to profit or loss following disposal
Cash flow hedges – fair value losses
Cash flow hedges – reclassification to profit or loss upon settlement
Currency translation differences arising from consolidation
Currency translation reserve on disposal of a subsidiary charged
to other gains/(losses) – net
Currency translation reserve on transfer of an investment
in an associated company to assets held for sale charged
to other gains/(losses) - net
Share of other comprehensive (loss)/income of associated companies
Other comprehensive income, net of tax
Total comprehensive income for the year
Profit attributable to:
Equity holder of the Company
Non-controlling interests
Total comprehensive income attributable to:
Equity holder of the Company
Non-controlling interests
FY10/11
(S$ m)
261.6 453.7361.9293.5318.6
66.5
192.2
123.7
87.0
102.7
Assets
FY06/07
FY07/08
FY08/09
FY09/10
142.4
(27.5)
41.3
222.7
(1.0)
221.7
(62.3)
159.4
51.6
(59.7)
173.5
(17.9)
44.5
392.3
0.4
392.7
(38.4)
354.3
(48.9)
-
45.6
(30.0)
37.1
176.4
(55.3)
121.1
(32.5)
88.6
(20.3)
-
95.6
(36.2)
21.9
168.3
(35.5)
132.8
(35.7)
97.1
44.1
-
104.1
(31.8)
40.0
215.0
10.2
225.2
(34.7)
190.5
(11.4)
(14.1)
-
-
(9.6)
-
-
(11.2)
-
-
(24.0)
(2.4)
0.9
6.2
(3.9)
2.8
(31.4)
7.4
(0.7)
23.4
(0.8)
(0.6)
-
2.3
(1.6)
(0.7)
-
(21.4)
(32.4)
127.0
(18.7)
(56.2)
298.1
(16.2)
(61.1)
27.5
4.1
53.6
150.7
(32.6)
(91.3)
99.2
Investment properties
FY06/07
FY07/08
FY08/09
FY09/10
FY10/11
1,209.9
773.2
1,237.0
1,308.6
1,148.5
Properties, plant and equipment
20.1
25.4
22.4
21.7
19.3
Development properties for sale
185.8
103.1
131.7
29.7
9.7
Investment in associates & joint ventures
492.3
842.5
904.6
963.6
971.8
Cash and cash equivalents
231.1
235.8
229.1
320.3
435.6
Others
401.5468.5486.7 474.8460.0
Total Assets
2,540.7
2,448.5
3,011.5
3,118.7
3,044.9
Borrowings / Medium term notes
645.1
370.2
728.9
814.8
715.4
Deferred income
189.4
185.4
181.3
177.2
173.2
Others
367.6 267.8444.6 326.4284.5
Total Liabilities
1,202.1
823.4
1,354.8
1,318.4
1,338.6
1,625.1
1,656.7
1,800.3
1,871.8
Shareholder’s funds
1,308.8
1,573.9
1,542.8
1,667.4
1,730.3
29.8
51.2
113.9
132.9
141.5
1,338.6
1,625.1
1,656.7
1,800.3
1,871.8
8.0%
17.2%
8.7%
8.4%
8.3%
11.8%
23.9%
5.7%
5.9%
11.2%
Minority interests
Total Equity
Financial Ratios
Return on invested capital (%)
Return on shareholder’s funds (%)
48%
23%
44%
45%
38%
Interest cover ratio (x)
9.84x
24.48x
6.11x
5.75x
9.36x
AUM S$ m
5,899
8,264
9,101
10,020
11,074
120.6
265.0
38.0
143.9
109.7
6.4 33.1(10.5) 6.8(10.5)
127.0298.1 27.5150.7 99.2
The financial statements have been prepared in accordance with Singapore Financial Reporting Standards (“FRS”). The financial statements have been prepared under the historical cost convention.
1,173.1
Net Assets
Gross debt equity ratio (%)
150.2
344.9
88.7
95.1
191.0
9.2
9.4
(0.1)
2.0
(0.5)
159.4354.3 88.6 97.1190.5
5 Years Financial & Operations Review
The financial statements have been prepared in accordance with Singapore Financial Reporting Standards (“FRS”). The financial statements have been prepared under the historical cost convention.
23
management activities recorded CAGR of
approximately 13% over 5 years.
5 Years Key Financial and Business Highlights
24
•
Generated total profit after tax and minority
interest of S$870 million in the last 5 years.
•
5 years rolling average return on invested
capital of 9.9%.
•
In the last 5 years, the shareholder’s funds
increased by a compounded average growth
rate of 7% to S$1.7 billion. 5 years rolling
average return on shareholder’s funds is 11.1%.
•
•
Realised over S$460 million of pre-tax
disposal gains through the recycling of
matured assets over 5 years
Almost doubled investments in associates and
joint ventures from S$492 million in FY06/07 to
S$972 million to FY10/11, reflecting The Group’s
investment strategy via third party funds.
•
Dividends received from associated companies
increased from S$33 million in FY06/07 to S$65
million in FY10/11. Total dividends received
over 5 years amounted to nearly S$290 million.
•
Recurring income from rental and fee income
maintained at more than 50% of The Group’s
total income in the last 3 year. Fees from fund
•
•
Debt to equity ratio maintained consistently
at below 60% for the last 5 years with prudent
capital management policies in place, while
interest cover ratio is supported at above 5x
with sustainable profits from operations
Achieved compounded average growth rate
of 13.4% in assets under management (AUM)
in 5 years. AUM $/Net Asset $ ratio has also
increased from 4.4 in FY06/07 to 5.9 in FY10/11,
reflecting the increase leverage on third party
funds to grow AUM.
Total Income
At 28% of total income, rental revenues remained
the biggest contributor to total income stream
in FY10/11. On average though, rental revenue
has been maintained at approximately S$120
million per year over the last 5 years, as The Group
continues to maintain a pipeline of assets being
matured before transferring them to our matured
asset Funds/ REITs.
Completed development properties recorded
highest sales of S$185 million in FY07/08. In
that year, The Group sold a total of 264 strata
titled units in the Frontier, Focus One and Food
Xchange developments. Sales in subsequent years
decreased as the stocks were gradually reduced at
a slower pace, consequent to the less favourable
economic conditions. FY10/11 saw a moderate pick
up in investors’ risk appetite and The Group will be
planning for new development units for sale in the
next 12-18 months.
Fee based income saw a huge jump in FY07/08
from 15% to 22%, primarily as a result of the
fees earned from the listing of a-iTrust, as well
as creation of new private funds. The fee based
income has since been held fairly consistent in the
last 4 years at about 23% of total income.
Other than in FY08/09, the year hardest hit by the
global financial crisis, The Group has consistently
recycled its capital through well-defined disposal
plans and realized profits from its matured
investment properties. Total gains realized in
the last 5 years through disposals of various
investment properties amounted to S$465 million.
Other income comprises of mainly share of profits
from The Group’s portfolio of associated entities,
as well as interest and utilities income.
Earnings Profile
Returns Analysis
In the 5 years from FY06/07 to FY10/11, total profit
after tax and minority interests, amounted to nearly
S$870 million, averaging in excess of S$170 million
per year.
Return on Invested Capital (“ROIC”) is the ratio
that indicates the efficiency and profitability of
the underlying capital investments in economic
value terms. 5-year moving average return is used
to remove the volatility in the real estate market
conditions.
FY07/08 registered the best performance,
contributed primarily from the disposal gains and
fees earned from the listing of a-iTrust, as, well
as disposal gains from the injection of various
matured assets into The Group’s managed funds,
strong sales of development properties and good
contributions from the associated entities.
Performances in FY08/09 and FY09/10 were
adversely affected by impairment provisions taken
on the properties, following the weak economic
conditions from the global financial crisis. In
FY10/11, The Group saw a quick turnaround,
particularly in the Asian economies and ended the
year doubling its profits from prior year.
The strong profits recorded in FY10/11 helps to
boost the ROIC to 8.3%. Overall, 5-year moving
average ROIC also increases consistently from 6.5%
to 9.9%.
Over the past 5 years, shareholder’s funds (net of
total dividend payout of S$188 m), has also grown
from S$1.3 billion to S$1.7 billion. This growth has
been achieved purely from profits generated
by the operations, as there was no additional
equity injection during the 5-year period.
Including dividend payout during this period,
the shareholder fund would have increased at a
compounded annual growth rate of 8%.
25
Treasury Highlights
(As at 31 March)
(S$ m)
FY08/09
FY09/10
FY1011
369
426
440
Available and unutilised
667
500
476
Cash and cash equivalents (excluding fixed deposits pledged)
209
295
410
Unutilised facilities and funds available for use
876
795
886
1,000
1,000
1,000
Bank Facilities and Available Funds
Amount utilised for loans
Debt Security Capacity
Total Real Estate Assets Base
26
In 5 years, The Group’s total owned and managed
real estate assets increased at a compounded
average growth rate of 13.5% to reach an assets
under management (AUM) of S$11.1 billion at
31 March 2011. In FY07/08, The Group registered
the highest AUM, where it launched a total of 5
new private funds, including 1 in India and 2 each
in China and Korea.
Over the years, The Group has consistently
executed its asset-light strategy to grow
its business. At the end of FY10/11, every
shareholder dollar translates to S$5.60 of assets
managed, as compared to S$4.40 of assets
managed 5 years ago. This strategy of growth
has also contributed to a stable stream of fee
based income for The Group.
At the same time, The Group has also gradually
shifted its focus beyond Singapore. Not only
has it deepened its presence in India and Korea,
The Group has also diversified its portfolio to
other Asian emerging economies in Malaysia and
Vietnam. Consequently, in 5 years, the AUM split
between Singapore and overseas operations has
shifted from nearly 70% / 30% to about 60% / 40%.
Debt securities capacity
Debt securities issued
80
130
50
920
870
950
184
210
299
30
36
32
6.11
5.75
9.36
Operating cashflow before interest and tax
111
186
192
Finance cost
30
36
32
3.68
5.09
6.01
Unused debt securities capacity
Interest Cover Ratio
Earnings before net interest, tax, depreciation and amortisation
Finance cost
Interest cover ratio (x)
Interest Service Ratio
Interest service ratio (x)
Secured Debt Ratio
Secured debt
% of debt secured
276
255
222
38%
31%
31%
729
815
715
Debt Equity Ratio
Gross debt
Equity
1,6571,8001,877
44%
45%
38%
27
(Fair Value Method)
Proforma Income Statement
(For the year ended 31 March)
(S$ m)
Liquidity
Liquidity has improved significantly now that the
global financial crisis is behind us. Interest rates
remained low throughout the year.
Despite the improved economic conditions, The
Group continues to maintain a prudent approach
to capital management and cashflow planning.
During the year, as part of the strategy to further
diversify its counterparty risks, The Group added
two more banks to its current network, bringing
the total number of international and regional
banking relationships to more than 14 banks. With
access to a wide spectrum of international and
regional banks, The Group is thus able to tap on
the different strengths and competencies of each
of these banks to enhance its competitiveness and
growth in the region.
As finance cost is an integral component of The
Group’s operating costs, a prudent mix of fixed
and floating rate borrowings is actively managed
by The Group. Although interest rates are at
currently at historically low levels, The Group has
been able to achieve interest savings of 60 basis
points below the market benchmark.
A persistent low interest rate environment in the
past year has also given The Group opportunities
to swap its floating borrowing rates to fixed rates.
At 31 March 2011, The Group’s fixed rate borrowings
constituted 76% of the total loan portfolio.
Interest cover ratio improved from 5.8 times in
FY09/10 to 9.4 times in FY10/11 due to lower
interest costs. Interest service ratio improved
from 5.1 times to 6.0 times due to a more efficient
working capital cycle.
During the year, The Group’s cash balances grew
S$115 million to reach S$436 million at 31 March 2011,
generated mainly from operations and proceeds
from the successful asset disposals executed.
At the same time, the total gross debt of S$715
million as at 31 March 2011 was 12% lower as
compared to S$815 million at 31 March 2010.
Consequently, the gross debt equity ratio at 31
March 2011 is 0.38 times, compared to 0.45 times
at 31 March 2010.
Debt Maturity Profile
The Group has also taken proactive steps to
spread out its debt maturity profile to diversify its
refinancing risks. As at 31 March 2011, the average
debt maturity is 3.01 years.
Subsequent to the financial year, The Group
successfully refinanced its S$100 million debt that
will be due in December 2011 to December 2016.
Loan Profile
At 31 March 2011, unsecured borrowings
comprised 69% of The Group’s total borrowings
with the balance secured by Ascendas’ properties
and assets. The secured borrowings are
substantially attributable to development project
finance loans. Together with cash reserves and
undrawn debt facilities of more than S$1.8 billion,
The Group is certainly in a stronger financial
position than ever to take advantage of new
investment opportunities.
FY07/08
FY08/09
FY09/10
FY10/11
Revenue
453.7 361.9294.2318.6
Profit before other gains, finance expense, share of profits from associates & joint ventures, tax and minority interest
223.9
Other gains/(losses) – net
598.0
(17.9)
Share of profits from associates & joint ventures
177.8
Profit before income tax
124.0
138.9
(75.2)
99.4
249.4
(30.0)
(36.2)
(31.8)
28.7
87.8
157.0
981.8
76.0
275.0
513.5
Income tax expense
(84.1)
(26.2)
(44.2)
(67.0)
Minority interest
(17.3)
3.0
(16.7)
(16.2)
880.4
52.8
214.1
430.3
Finance expense
28
Unaudited Pro-Forma Financial Review
Profit after tax and minority interest
152.5
29
Building Integrated Communities - A New Generation of Workplace
Proforma Balance Sheet
From left:
Ascendas Park Square Mall,
Taj Vivanta Hotel, ITPB
(As at 31 March)
(S$ m)
FY07/08
FY08/09
FY09/10
FY10/11
1,376.8
1,817.4
1,935.7
1,826.9
25.4
22.4
21.7
19.3
More Exciting Space To Come
Assets
Investment properties
Properties, plant and equipment
Development properties for sale
103.1
131.7
29.7
9.7
1,063.9
1,143.1
1,274.4
1,397.0
Cash and cash equivalents
235.8
229.1
320.3
435.6
Others
468.6486.9 474.8460.0
Investment in associates & joint ventures
30
Total Assets
3,273.5
3,830.6
4,056.6
Borrowings / Medium term notes
370.2
728.9
814.8
715.4
Deferred income
185.4
181.3
177.2
173.2
Others
359.6556.4441.4 416.1
Total Liabilities
915.2
Net Assets
Shareholder’s Funds
Minority interests
Total Equity
1,466.6
1,433.4
4,148.5
1,304.7
2,358.32,364.02,623.22,843.8
2,296.6
2,238.3
2,466.9
2,660.8
61.7
125.7
156.3
183.0
2,358.32,364.02,623.22,843.8
Financial Ratios
Return on shareholder’s funds
38.3%
2.3%
9.1%
16.8%
16%
31%
31%
25%
The unaudited financial statements have been prepared in accordance with Singapore Financial Reporting Standards (“FRS”). The financial statements have been prepared under the historical cost convention
except investment properties including those under investment in associates at fair value.
As the Generation Y are expected
to form the majority of workforce
in the fast growing economies
and businesses across the globe,
Ascendas’ customers can expect more
exciting new workspace that we are
planning for this new generation of
workforce. The prevailing trend of
merging traditional workspace, social
interaction, and lifestyle activities
into one integrated environment
has motivated us to conceptualize,
design and build more Integrated
Communities (IC).
For each Integrated Community, we
will meticulously plan and cultivate a
multi-layered socio-economic fabric of
mutually supporting industry clusters,
business connectivity and alliances, and
a web of social and talent networks.
The final product to be expected
is a living eco-system of thriving
businesses and talents, fully integrated
as one harmonious community.
Our customers can look forward to
a brand new lifestyle experience in
the workspace environment for the
Generation Y workforce.
A good example of an Integrated
Community is our iconic International
Tech Park in Bangalore (ITPB), India.
Home today to 24,000 software
engineers, ITPB is what we call a
“World within a Park” - with quality
work offices housing top companies
from the knowledge industries, and
supported by a comprehensive range
of business and lifestyle amenities
such as the 5-star Taj Vivanta
Hotel, food courts and restaurants,
healthcare facilities, residential,
public spaces for interaction and
community events, as well as the
soon to be opened full size retail mall
Park Square. There is always life in the
park – whether it is a rock concert, a
chess competition, a fashion show
or even the filming or screening of
Bollywood movies.
Adopting the philosophy of building
more “Integrated Communities”, The
Group will be developing a pipeline
of business parks and townships in
Singapore, China and India to cater
to the evolving needs of the next
generation of end-users over the next
5 - 10 years.
31
From top:
Ascendas OneHub Gurgaon
Dalian Ascendas IT Park,
33
Changi City@Changi Business Park
Building Integrated Communities - A New Generation of Workplace
Singapore
Integrated Township
34
Name
Product Type
AZ Building
Industrial
100.00%
21,723
NH Techno
Industrial
100.00%
17,608
Admirax
Industrial
100.00%43,585
Fleming and Faraday
Science Park/Business Park
100.00%
10,657
Mendel & Maxwell
100.00%
9,980
Pascal & Pasteur (due for re-development)
100.00%
n.a
Effective Stake
Total Net Lettable Area (sqm)
Chadwick/Curie/Cavendish
100.00%
20,600
Cintech I
100.00%
10,531
Cintech II
100.00%
7,915
Cintech III
100.00%
8,394
Cintech IV
100.00%
10,199
The Franklin
100.00%
7,268
The Aquarius
100.00%
3,063
The Galen
100.00%
21,790
Kendall
100.00%
17,070
ICON@IBP
100.00%
33,086
Changi Business Park
50.00%
n.a.
Science Park I Land Leases
Land Lease
100.00%
n.a.
Ang Mo Kio Land Lease
Land Lease
100.00%
n.a.
Science Park II Land Leases
Land Lease
100.00%
n.a.
Science Park III
Land Lease
100.00%
n.a.
Teletech Park
Land Lease
25.00%
n.a.
ePark@admiralty
Vacant Land
100.00%
n.a.
A-REIT Portfolio
note 1
20.86%
note 1
At its inception, Ascendas’ real estate assets under management (AUM) stood at S$1.7 billion. Today, Ascendas’ AUM has multiplied more than six-folds to
S$11.1 billion to become Asia’s premier provider of business space solutions. Its stable of assets, at some 50.2 million sq ft of business space, includes awardwinning science, business and industrial parks and customized developments for a host of high technology industries.
Note 1: A-REIT owns a diversified portfolio of 93 properties in Business & Science Parks, Hi-Tech Industrial, Light Industrial/Flatted Factories, Logistics & Distribution Centres and Warehouse Retail Facilities, with a
total net lettable area of 2.0 million sqm.
Property Portfolio As At 31 March 2011
35
India
Name
City
Product Type
Effective Stake
Ascendas Xinsu
Suzhou
Industrial
25.58%
279,355
Friwo
Beijing
Industrial
99.70%
7,171
Foseco
Tianjin
Industrial
100.00%
8,136
Wujiang Industrial Park
Wujiang
Industrial
100.00%
35,771
YUM
Beijing
Logistics
99.70%
8,058
Exel
Beijing
Logistics
99.70%
11,112
Ascendas Plaza (Office)
Shanghai
CBD Office
30.55%
26,240
Ocean Tower
Shanghai
CBD Office
30.55%
50,192
Cross Tower
Shanghai
CBD Office
30.55%
41,459
Ascendas Plaza (Retail)
Shanghai
MD Retail
30.55%
13,268 Z-Link
Beijing
25.58%
27,450 Dalian Ascendas IT Park
Dalian
50.00%
143,043 Ascendas Innovation Hub
Xi’an
100.00%
34,249 iHub Nanjing
Nanjing
100.00%
46,339 Lyra/Hyra/Nexus/ Singapore
Hangzhou
80.00%
43,360
-Hangzhou Science & Technology Park
Singapore-Hangzhou Science Hangzhou
Vacant Land
80.00%
n.a.
& Technology Park
Dalian Ascendas IT Park
Dalian
Vacant Land
50.00%
n.a. Wujiang Industrial Park
Wujiang
Vacant Land
100.00%
n.a. Ascendas Xinsu
Suzhou
Industrial
25.58%
n.a. Suzhou iHub
Suzhou
WIP/ Vacant Land
100.00%
n.a. Projects expected to complete in next 12 months (After 31 Mar 2011)
Total Gross Floor Area (sqm)
Name
City
Product Type
Cybervale
Chennai
IT Park
100.00%
52,720
AIDT Portfolio
note 2
note 2
26.00%
note 2
A-iTrust Portfolio
note 3
note 3
25.87%
note 3
Projects expected to complete in next 12 months (After 31 Mar 2011)
Dalian
50.00%
42,827 Suzhou iHub
Suzhou
100.00%
38,731 Total Net Lettable Area (sqm)
Voyager, ITPB
Bangalore
IT Park
26.00%
49,703
Phase 1 IT SEZ, AOG
Bangalore
IT Park
25.87%
45,987
Note 2:
Note 3:
AIDT, being our private fund in India is in the midst of developing the Ascendas OneHub Gurgaon, IREO Gurgaon and Chennai Integrated Township
Listed Business Trust, A-iTrust, consists of four world class IT Parks in India, namely the International Tech Park Bangalore, International TechPark Chennai, CyberPearl and The V in Hyderabad.
37
Korea
Name
City
Product Type
Citibank Center
Seoul
CBD Office
30.00%
19,752
Dadong Center
Seoul
CBD Office
30.00%
15,113
Anam Tower
Seoul
CBD Office
30.00%
12,865
West Finance Center
Seoul
CBD Office
57.00%
92,173
CJ GLS Warehouse
Yong-In
Logistics
30.00%
13,279
AKIF West Icheon Logistics Center
Icheon
Logistics
30.00%
n.a.
Effective Stake
Projects expected to complete in next 12 months (After 31 Mar 2011)
Signature Towers Seoul
Dalian Ascendas IT Park Phase III
Effective Stake
36
China
Seoul
CBD Office
30.00%
99,994
City
Product Type
RBF@Carmelray
Calamba
Industrial
ACCRALAW Tower
Taguig
Ascendas Tower 2
Taguig
Sta. Elena
Taguig
Effective Stake
64.00%
72,593
CBD Office
20.50%
18,391
Vacant Land
46.60%
n.a.
Vacant Land
20.50%
n.a.
Malaysia
Name
38
Peremba Square
City
Subang Jaya
Product Type
Effective Stake
Science Park/ Business Park
7.43%
22,946
Ascendas Logistic Hub
Subang Jaya
Logistics
7.43%
11,904
Ascendas IT park
Cyberjaya
Vacant Land
7.43%
n.a.
Ascendas Business Park - Twin City
Petaling Jaya
Vacant Land
7.43%
n.a.
Product Type
Effective Stake
Industrial
14.35%
Vietnam
Name
Ascendas -Protrade Singapore Tech Park
City
Binh Duong
n.a.
Name
Philippines
39
40
JOY
More Dedication to The Communities
JOY
40
Life’s finest rewards come when you can do more of
the things you love with the ones you love. In an era
where life and work merges, this is where the joy in life
finds you!
At Ascendas, we are committed
to manage all aspects of our
business in an ethical, responsible
and sustainable way. We leverage
on our core competencies in
building communities to fulfill our
role as a good corporate citizen
to help improve the quality of
life in communities we serve.
We support the arts and do our
part through active community
involvement. We are also committed
to continuously promote economic
and environment sustainability and
promote initiatives that uphold
health and safety standards.
Community
Across Asia, Ascendas continues
to widen its reach in community
activities that improve the quality of
life of the less fortunate. For example,
more than 40 employees from
Ascendas China brought love and care
to the left-behind children studying at
Chang Gang Primary School in Anhui
Province. Lacking the care of their
parents who have moved to the cities
in search for work, these children are
often vulnerable to serious physical
and psychological dangers. The
company also donated RMB70,000
(approximately S$14,000) to provide
over 2,000 books, stationery,
sports equipment as well as fund a
scholarship for the school.
In India, we continued our annual
support to recognizing talents of
the differently-abled at the annual
Ascendas Excellence Award in
Chennai. Into its fourth year, the
award recognizes the outstanding
achievement of the differently-abled
in the fields of music, art, academics,
medicine and sports, in particular
women talents, for 2010. Winners of
the award include visually-challenged
Ms Gayathiri Shankar, who had
previously received India’s fourth
highest civilian honour, the award of
Padma Shri by the Indian government,
for her outstanding contribution to
music. Other winners include Dr K
Radhabai, the first visually-challenged
woman to receive a PhD in South
India, and Ms J Anuradha, who is a
winner of the wheelchair race in the
Chennai Marathon.
In Bangalore, Ascendas organized
The Grand ITPB Jigsaw Challenge at
the International Tech Park Bangalore.
The challenge saw teams comprising
tenant employees coming together
to compete in solving a 3,000-piece
jigsaw puzzle and participation fees
were collected as part of the charity
drive. Upon matching dollar-for-dollar,
the total proceeds of INR 200,000 was
donated to the Divine Light Trust for
the Blind, a school at Whitefield that
provides education to underprivileged
children in Bangalore.
In Singapore, Ascendas’ community
activities focused on enhancing
children’s education. The company,
in collaboration with Southwest
CDC, organized a series of nature
excursions that brought secondary
school students to nature reserves
such as Sungei Buloh Wetlands
Reserve and Pulau Ubin to enhance
their education and awareness of the
natural environment.
The activities were followed up by
community work at elderly nursing
homes, where Ascendas employees
and students jointly engaged in
befriending and cleaning activities
with the senior citizens at the homes.
As part of the environment awareness
initiative, a separate community
activity also saw Ascendas employees
and the students working together to
clean up the park at Changi Beach.
As part of the company’s kickoff to a
year of 10th anniversary celebrations,
Ascendas generously gave our
support and energy to raise funds for
the Movement for the Intellectually
Disabled of Singapore (MINDS). At
the Ascendas 10th Anniversary Gala
Dinner, Ascendas senior management
and staff showcased their talents
to raise funds, to which Ascendas
matched dollar-for-dollar. A total of
S$57,000 was donated to MINDS at the
end of the evening.
In Vietnam, Ascendas employees
visited underprivileged children at
the Nuoc Ngot Cathedral and Phu
Loc Centre, located in the rural area of
Phu Loc which is undergoing difficult
social-economic conditions. The
team assisted in the cleaning of the
shelters in addition to sharing care
and concern through gifts, games and
befriending activities.
In the Philippines, Ascendas
employees helped in the construction
of homes under a Habitat for
Humanity project. The team also
participated actively in the Typhoon
Shelter Kit Donation, which benefited
eight underprivileged families.
41
The Arts
42
Ascendas is a keen supporter of
the arts, and actively contributes to
local arts groups in Singapore. Since
2004, Ascendas has supported the
Singapore Repertory Theatre (SRT)
as a corporate sponsor. Founded
in 1993, SRT’s mission is to produce
outstanding theatre with an Asian
spirit and help Singapore take its
place among the world’s cultural
capitals, an aspiration which
identifies closely with Ascendas’
Asian ideals.
Ascendas has also regularly supported
productions that showcased the
talents of emerging local artists,
including performances by the
Sheares Production at the National
University of Singapore and Singapore
Dance Theatre among others.
In recognition of our support and
contribution to the Arts, Ascendas
has received the Associate of
the Arts Award from Singapore’s
National Arts Council in 2010. This is
the ninth consecutive year in which
Ascendas was recognized for its
support of the arts.
Health & Safety
The company continues to promote
and uphold high Health and Safety
standards in its operations. In
addition to the roll-out of Workplace
Safety and Health Management
System to its operations in India
and China, Ascendas has also
implemented initiatives to ensure
proper hygiene is maintained at its
food and beverage outlets within
International Tech Park Chennai
(ITPC) in India. Sporting Lifestyle
activities that encourage a healthy
work-life balance among tenants and
their employees are held annually
and have been extended to tenant
communities at ITPC, International
Business Park in Singapore, as well as
across our China parks.
At Ascendas, we
are committed to
manage all aspects
of our business in an
ethical, responsible
and sustainable way.
We leverage on our
core competencies in
buildings communities
to fulfill our role as a
good corporate citizen
to help improve the
quality of lifes in
communities
we share.
Ascendas continues to take a lead
amongst local real estate players in
green, sustainable development.
To-date, we have invested more
than S$10 million in energy
management initiatives across our
local and overseas properties, with
the number set to increase.
Energy Efficiency
Improving the energy efficiency of
our existing stock of buildings is the
fastest and surest way of reducing
our carbon footprint. Ascendas is
committed to lower our carbon
footprint and at the same time,
enhance the energy efficiency of
our existing buildings, an initiative
that we have started since 2005.
The projects under this initiative
included upgrading of the chiller
plant and lighting systems, waste
water recycling and streamlining the
operations of our properties.
In 2009, Ascendas successfully
upgraded the chiller plant at The
Galen at Singapore Science Park
II, enabling the building’s new
chiller plant to operate with a total
efficiency of 0.563 kilowatt per 1
refrigerant ton of cooling, one of the
most efficient in Singapore.
As a result, the Ascendas Group
has achieved total savings of 11,730
megawatts and 187,880 m³ for
electricity and water consumptions
respectively in 2010.
Following the successful upgrading
project, Ascendas has embarked
on the upgrading of the chillers
at two buildings, Acer Building at
International Business Park and The
Capricorn at Singapore Science
Park in 2010. Together with other
energy-related projects in the
pipeline, Ascendas energy efficiency
initiatives will result in further savings
of 6,400 megawatts in electricity
consumption when these projects
are completed in Q4 2011.
Moving forward, Ascendas takes
a holistic approach to minimize
our carbon footprint. This includes
controlling and making our new
buildings energy efficient during
the design and development
phase, as well as upgrading and
optimizing the energy efficiency of
our existing properties.
More Energy Efficiency, Greater Sustainability
43
Green Month
44
Ascendas kept up the momentum
in raising environmental awareness
among our tenants and employees,
building on the achievements of the
annual Green Month campaign.
Ascendas’ third annual Green Month,
themed “Go Green, Live Green”, saw
the showcase of a prototype Solar
Kiosk, a joint project by Ascendas
and Singapore Polytechnic. The
Solar Kiosk is the first to utilise
Organic Photovoltaic Technology
incorporating nano-structured solar
cells to generate power.
“Go Green, Live Green” also saw
an increase in participation from
companies located in Singapore. A
total of 234 participants signed up for
the various activities carried out during
the month, including nature excursions,
Earth Challenge race, workshops and a
forum on sustainability.
The Green Month campaign in 2010
continued to draw enthusiastic
response and support across
Ascendas’ India Parks, with weekly
activities such as tree planting,
eco-bazaar, Green Idea Week and
Eco-drive Week.
In China, Ascendas widened the
reach of its Go Green campaign
pan-China, with a month of activities
carried out across our parks, receiving
popular support from our tenants and
their employees. Part of the activities
included a high-profile pledge to
promote low carbon footprint.
Ascendas’ Singapore-Hangzhou
Science & Technology Park participated
in the signing of the “Zero-Carbon
Commitment” at the 2010 Yangtze
Delta Zero-carbon Science and
Technology Forum held at World Expo
in Shanghai.
Green Design
Ascendas’ efforts at minimizing the
impact of our business on the natural
environment extend into the design
and development phase, ensuring that
our new buildings and projects are
energy efficient and environmentally
friendly. Our commitment to the cause
received recognition in 2010, when
Ascendas scored a double by clinching
two awards in the 2010 Cityscape Asia
Real Estate Awards. Dalian Ascendas IT
Park in China came out top in the ‘Best
Urban Design and Master Planning’
category and Citi at 3 Changi Business
Park Crescent in Singapore emerged as
the winner in the ‘Best Green Building
(Built)’ category.
Ascendas ChiQG
Chic with Quality and Green
An extension of our Green Design,
Ascendas ChiQG epitomizes
our commitment to design
environments that not only cater
to the needs of our customers and
a new generation workforce, but
provide a “Space to be” competitive
and sustainable. The initiative
comprises design principles that
emphasizes on maximizing the
flexibility and use of landscape
and common spaces to encourage
interaction and community
building. It also encompasses
green principles guiding the use of
building and recyclable materials,
optimizing daylight and M&E
integration, minimizing use of glass
materials and minimizing heat gain
within buildings.
Ascendas’ green strategy focuses not
only on environmental sustainability,
but achieving economic sustainability
for our customers as well. Hence,
Ascendas ChiQG principles ensure
that our designs optimize building
efficiency both in operations and
infrastructure, to ensure competitive
value to our customers.
indoors and outdoors, such as new
areas for dining, discussion, work and
relaxation. When completed, the
lobby will also be a showcase of green
and sustainable design that lowers
energy consumption by maximizing
natural ventilation and daylight, when
ensuring appropriate comfort for
different weather conditions.
Galen Lobby
Green Mark Awards
An initiative that had its origins in
creative innovations suggested by
Ascendas employees, the Galen
lobby will undergo renovation and
upgrading to maximize the use
of space and landscape features.
The upgrading will transform the
conventional air-conditioned office
lobby area to one that showcases
new design attributes and innovative
use of sustainable construction
materials and methods. The design
also includes creating comfortable,
human-centric interactive spaces
As at 2010, Ascendas has achieved
a total of 8 Green Mark awards and
has set our sights on achieving the
BCA Green Mark Champion Award.
The award was launched in 2008 and
recognizes developers with strong
commitment towards corporate
social responsibility and outstanding
achievements in environmental
sustainability. It is given to developers
who achieve a minimum of 10
Green Mark buildings at Gold level
and higher, of which 3 are awarded
GoldPLUS and 3 are awarded Platinum.
Ascendas is committed to achieve
Green Mark GoldPLUS or Platinum
award for four new developments
in our objective to meet the criteria
for the Green Mark Champion. These
include Infinite Studios at Mediapolis,
Biopolis Expansion at one-north,
Changi City @ Changi Business Park
and the development of two new
buildings at Singapore Science Park I.
45
A Sense Of Feeling “Valued And Involved”
The Emerson Cup 2010
Ascendas won regional recognition
for its green efforts at The Emerson
Cup 2010 (India & Southeast Asia)
held in Chennai, India. The chiller
upgrading project at the Galen
building in the Singapore Science
Park received the Excellence Award
under the Retrofit category.
People Developer Standard 2010
46
Ascendas was re-certified as a
People Developer organisation in
recognition of its investment and
commitment to staff learning and
development. The People Developer
Standard is a national standard
for human resource development
administered by SPRING Singapore
(Standards, Productivity and
Innovation Board).
Cityscape Asia Real Estate
Awards 2010
Ascendas scored a double by
clinching two awards in the 2010
Cityscape Asia Real Estate Awards.
• Best Urban Design and
Master Planning
Dalian Ascendas IT Park, China
• Best Green Building (Built) Citi at 3 Changi Business Park
Crescent, Singapore
2010 Intelligent Business
Special Award
Ascendas China received the 2010
Intelligent Business Special Award. An
extension of the China Top Intelligent
Entrepreneurs Awards, the award
recognizes Ascendas’ contributions
to the country’s economy through its
involvement in the development of
Suzhou Industrial Park and integrated
business parks in China. The award also
recognized the company’s contribution
to China’s culture and society through
its CSR initiatives.
Model Park Awards
Ascendas is committed to achieve
several awards in recognition of
its efforts in attracting quality
investment and contributing to the
service outsourcing industries in
Dalian and Hangzhou.
Dalian Ascendas IT Park was named
one of the “Dalian Top 10 Modern
Service Enterprise” in the foreign
investor category.
Singapore-Hangzhou Science &
Technology Park was named the
“Hangzhou Service Outsourcing
Model Park”, “Model Park for
Zhejiang International Service
Outsourcing Industries” and “Model
City Expansion for China Service
Outsourcing Industries.”
In Ascendas, Management believes
that employee engagement,
particularly in today’s environment,
is core to our business success and
a key force that drives The Group’s
performance outcomes. We firmly
believe that an engaged workforce is
a productive workforce - employees
who are engaged at work are
automatically more willing to learn
and perform their best at work.
In Ascendas, we continue to drive
employee engagement through the
enhancement of various employee
engagement strategies:
Open Communication
2-way communication to which
employees can voice their ideas and
the company listens to these views
Teamwork & Innovation
involving employees in decision
making and cross functional projects
Learning & Development
providing opportunities for
employees to learn and grow in
their jobs
Recognition & Relationships
valuing employees’ contributions
and concern for their health and
well-being
More Employee Engagement
47
48
In the past 10 years, the Ascendas’
family has grown from 300 staff to
over 800 staff today, in tandem with
The Group’s business expansion
regionally. Our staff strength
comprises talents from 9 nationalities
(Singapore, China, India, Philippines,
Korea, Japan, Malaysia, Vietnam and
Indonesia) working towards achieving
The Group’s vision and mission, at the
same time leveraging on each other’s
expertise and knowledge.
the company, The Group’s staff
retention rate has always been above
industry average. Employee equity
for Ascendas remained stable, healthy
and above Asia Pacific norms. We
continue to maintain healthy retention
ability with a high proportion of
committed employees. This is
particularly evident that employees
are willing to recommend The Group
as an employer, as well as to refer its
products and services.
training sessions to upgrade their
skills set. In FY10/11, one key training
initiative was to ensure that our
service quality continues to be one of
The Group’s differentiating strategies
for competitive advantage. As such, a
group-wide customer service training
was rolled out during the year to
further inculcate service mindset of
our staff and improve their skill-sets
in service delivery and delighting
our customers.
With the various employee
engagement strategies and
programmes in place which
include creating a comprehensive
communication strategy and
designing development opportunities
for every employee, we are proud that
in consecutive Employee Engagement
surveys carried out in 2008 and 2010,
our employee engagement results
were close to world-class standards.
At close to 20% of our staff strength
with more than 5 years’ service with
As a young organisation, The
Group will need to continue its
focus on building its pool of talent.
The Group also firmly believes in
investing in continuous education
for its workforce and encourage job
rotation to expose our top talents to
different facets of the organisation’s
business. Throughout the years, even
during recessions, generous annual
budgets have been diligently set
aside for staff to undergo compulsory
regular developmental and functional
As The Group continues to expand,
we recognize the need to engage
our new staff as soon as they are
on board, so as to ensure that they
assimilate quickly into The Ascendas’
culture and environment. Towards
this end, we have rolled out a new
e-Induction programme, which
provides new joiners with a good
corporate introduction and allows
the new staff to go through the
various modules at their own pace
without the constraint of time.
Until 2007, The Group has been
managing risks diligently in critical
business areas particularly in
ensuring strict compliance with
internal and external regulations. In
2007, motivated by the need to deal
more effectively with increasing
business complexities, as well
as uncertainties in increasingly
competitive environments, the
Enterprise Risk Management (“ERM”)
framework was conceptualised,
with the initial aim to provide
Management with a bird’s eye view
of identifying, analysing, treating and
monitoring risks.
The framework was first
implemented in the Singapore
operations, starting with investment
risk evaluation. As the team gained
experience along the way, the
framework was subsequently
rolled out organisation wide
to the overseas operations, as
well as to other critical business
areas such as fund management,
project management, property
management etc. In the last few
years, ERM has gradually evolved
ADRC:
MAP:
KRI:
REDI:
DPD:
REF:
Ascendas Design Review Committee
Management Action Plan
Key Risk Indicators
Real Estate Development & Investment
Development Planning and Design
Real Estate Funds
More Ownership Of Risk Management
49
into a continuous and interactive
process. Today, management of
risks in The Group is an integrated,
aligned and coordinated effort
across the entire organisation,
where central risk registers are
updated systematically for the
respective risk owners to review
and re-appraise The Group’s
exposures regularly.
50
In order to promote awareness and
a strong risk management culture,
many organisation-wide ERM
initiatives have been introduced,
covering areas of responsibilities such
as those relating to tax, accounting,
health & safety, IT security, and
investment processes. Some of these
initiatives include an awareness
platform on the intra-net (Ascendas
ASKME), an ERM Blog for sharing of
views across in-house webservices,
survey of Ascendas Manager’s Risk
Index to gather confidence level
internally, in the context of how well
risks are being managed.
In 2010, Business Continuity Plans
(“BCP”) were also put in place for all
corporate service units and business
units in all countries of operations.
A Business Continuity Mobilisation
(“BC Mob”) was carried out at the
head quarters in February 2011 to
validate these plans. During the
exercise, the participants went
through several mock up scenarios
and simulations. Many good lessons
were learnt for us to refine the plans
further. Moving forward, we plan to
carry out similar exercises in other
countries of operation, to better
prepare us for situations with varying
degrees of complexities.
In the longer term, The Group
believes in cultivating the risk DNA
in each and every staff member to
build a collectively more resilient
organisation. The ERM framework will
continue to evolve with the changing
business landscape. As a matter of
good learning spirit, The Group will
also continue to search for good risk
management practices by comparing
with our partners and companies
who are willing to exchange ideas in
relation to risk management.
The Board of Directors and Management are committed to comply with the Code of Corporate Governance 2005, which is under the purview of the Monetary Authority
of Singapore, so as to achieve and maintain a high standard of corporate governance which sets the foundation for good and strategic business management.
Report on Corporate Governance Practices
(A)BOARD OF DIRECTORS
The Board of Directors comprises a majority of independent directors who collectively possess considerable experience and competencies in their respective
fields to facilitate effective decision making. The profiles of the directors are provided on pages 8 to 10.
The Board sets corporate policies and strategic objectives for The Group. Matters requiring the Board’s decision and approval include:
• Major funding proposals, investments, acquisitions and divestments;
• The annual budgets and financial plans of The Group;
• Annual and quarterly financial reports;
• Internal controls, risk management strategies and execution thereof; and
• Appointments of directors. The Group has in place financial authorization limits for matters such as operating and capital expenditure, acquisition and disposal of assets and investments, which
require the approval of the Board.
The Board meets regularly and as and when warranted by particular circumstances. Board meetings may be conducted via tele-conference.
To ensure that specific issues are subject to in-depth review and discussion before the Board makes its decisions, certain functions have been delegated by the
Board to various Board Committees, which make recommendations to the Board. The Board Committees include the Board Investment Committee (BIC), the Audit
Committee (AC) and the Management Development and Compensation Committee (MDCC).
(B)BOARD INVESTMENT COMMITTEE
The Board Investment Committee (“BIC”) meets as and when matters requiring approval by the BIC, based on Ascendas’ Financial Regulations.
Terms of Reference:
• To evaluate and approve investments to be made by The Group (including the injection of additional capital into subsidiaries, equity participation and/or
extension of contingent liabilities in joint venture companies by The Group;
• To evaluate and make recommendation to the Board of Directors whether or not The Group should participate in any land tenders (private land or
government land), and if so, the price to be submitted;
• To evaluate and approve or make recommendation to the Board on accepting financing offers and banking facilities;
• To evaluate and recommend changes to the financial limits for investments, borrowings and contingent commitments for the Board’s approval;
• To report to the Board on decisions made by the BIC; and
• Any other responsibilities that may be delegated by the Board.
51
• Provide a forum for discussion on risk issues and oversee the management thereof;
The Audit Committee (AC) meets on a quarterly basis, and when circumstances warrant. The AC currently comprises four members, majority of whom are
independent directors.
• Report to the Board on material matters, findings and recommendations; and
(C)AUDIT COMMITTEE
• Review issues raised by Internal Auditors that impact the risk management framework.
Terms of Reference:
• To review and approve the audit plan with internal and external auditors;
• To review the internal auditors’ evaluation of internal controls;
• To review the results of the internal audit findings and guide Management on the actions to be taken;
• To review the internal and external auditors’ reports;
• To recommend to the Board the re-appointment of external auditors;
• To review The Group’s processes for managing business, financial and regulatory risks;
52
• To meet with the external auditors to have open exchanges, without the presence of Management, at least once annually;
• To review the independence of the external auditors annually; and
• To review and make recommendation to the Board to approve The Group’s financial results on a half yearly basis;
The Group’s internal audit function is currently outsourced to KPMG LLP, and coordinated internally by Ms Marie Ong, VP Internal Audit. KPMG LLP draws up an
annual audit plan which focuses on internal control systems including financial, operational, IT and compliance controls and risk management, after a series
of planning interviews conducted with Management in February or March each year. The annual plan is discussed and approved at the AC meeting in May
each year. KPMG LLP also recommends improvements to effectiveness and economy of operations, and improvement to corporate governance practices. Any
material non-compliance or lapses in internal controls together with corrective measures are reported accordingly to the AC.
The Group has an Enterprise Risk Management (ERM) unit to define and mitigate risks and threats to its businesses. The ERM framework incorporates a continuous
and interactive process for enhancing risk awareness and promoting a culture of risk management across the organisation. Currently, the AC is updated on a
quarterly basis on emerging risks, as well as how current risks are being managed.
The AC’s term of reference on risk management are:
• Review and guide Management in formulating risk management policies;
• Review actual risks, control deficiencies and risk mitigation strategies with the Management;
• Ensure that infrastructure, resources and systems are in place for risk management and are adequate to maintain a satisfactory level of risk management discipline;
• Examine the effectiveness of The Group’s risk management system to ensure that a robust risk management system is maintained;
• Review and guide management in establishing a process to effectively identify, evaluate and manage significant risks;
• Review risk limits where applicable;
(D) MANAGEMENT DEVELOPMENT AND COMPENSATION COMMITTEE
The Management Development and Compensation Committee (“MDCC”) meets on a quarterly basis, and when circumstances warrant.
Terms of Reference:
• Approve The Group’s compensation and benefits strategies and policies;
• Approve the appointment, promotion, compensation and benefits of key senior staff of The Group; and
• Approve the career development and succession plans of key senior staff.
53
Board Composition
Name of Director
Board of Directors
Audit Committee
54
Board
Investment Committee
Mr Lim Hock San
Mr Manohar Khiatani
Chairman
Member
Member
Mr Reggie Thein
Member
Chairman
Mr Chee Hong Tat
Member
Member
Mr Lee Eng Beng
Member
Member
Management Development
& Compensation Committee
Chairman
Member
Mr Willy Shee
Member
Chairman
Mr Charles C.Y. Chen
Member
Member
Mr Tan Gee Paw
Member
Member
Ms Chong Siak Ching
Member
Member
Member
Member
Attendance in FY10/11
Board
Management Development &
Name of Director
Board Meetings
Audit Committee Meetings
Investment Committee
Compensation Committee Meeting
Mr Lim Hock San
6
-
- 3
Mr Manohar Khiatani
5
3
- 4
Mr Reggie Thein
5
4
- -
Mr Chee Hong Tat
5
3
- -
Mr Lee Eng Beng
4
3
- -
Mr Willy Shee
5
-
3 4
Mr Charles C.Y. Chen
3
-
2 -
Mr Tan Gee Paw
5
-
3 -
Ms Chong Siak Ching
6
-
3 4
Total meetings held
6
4
3 4
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Annual Report 2010/2011 - Ascendas

Transcription

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