Jaya Holdings Annual Report 2010

M OVI NG AH EAD
JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010
CORPORATE MISSION STATEMENT
A commitment to quality and integrity in all aspects of our business equipment, service and customer relationships. A constant drive to satisfy our customers, while always being mindful of our responsibility to our shareholders, employees and the community.
CONTENTS
1 4 5 6 FINANCIAL HIGHLIGHTS CORPORATE INFORMATION CORPORATE GROUP STRUCTURE CHAIRMANS STATEMENT
10 BOARD OF DIRECTORS 13 KEY EXECUTIVES 14 REVIEW OF OPERATIONS 22 CORPORATE GOVERNANCE 28 STATUTORY AND FINANCIAL REPORTS
FINANCIAL HIGHLIGHTS
GROUP REVENUE ($000)

400,000 350,000 300,000 250,000 200,000 150,000 100,000 50,000 0.00
PROFIT ATTRIBUTABLE TO SHAREHOLDERS ($000)

357,063
160,000 140,000
149,750 120,774 107,328 103,715
306,190
307,638
307,164 263,171
120,000 100,000 80,000 60,000 40,000 20,000 0.00
1,195
FY06
FY07
FY08
FY09
FY10
FY06
FY07
FY08
FY09
FY10
EARNINGS PER SHARE (CENTS)
NET ASSET BACKING PER ORDINARY SHARE (CENTS)

70.00
62.06 56.83
25.00
60.00
19.43
20.00
49.10
50.00 40.00 30.00
15.80 14.20 13.44
41.93
48.64
15.00
10.00 20.00 5.00
0.15
10.00 0.00
0.00
FY06
FY07
FY08
FY09
FY10
FY06
FY07
FY08
FY09
FY10
TOTAL ASSETS ($000)

1,200,000
SHAREHOLDERS FUND ($000)

1,005,058 992,144 858,702
500,000
1,000,000
438,504 377,743 375,383
478,884
800,000
400,000
318,619
601,285 514,355
300,000
600,000
400,000
200,000
200,000
100,000
0.00
0.00
FY06
FY07
FY08
FY09
FY10
FY06
FY07
FY08
FY09
FY10
TOTAL ASSETS OWNED ($ MILLION)
1,200
1,000
800
600
400
200
0
2006 2007 2008 2009 2010
Fixed deposits and cash balances Trade receivables and others Stocks and work-in-progress Investments Fixed assets Intangible assets Total
49 25 153 29 258 0 514
29 73 176 28 295 0 601
20 202 192 30 404 11 859
102 98 384 7 397 4 992
209 144 270 7 375 0 1,005
The Groups total assets stood at $1 billion as at 30 June 2010 and were $13 million or 1% higher than the previous nancial year. Fixed assets decreased as a result of vessel disposals during the nancial year under review. Trade receivables and others were higher mainly due to billings issued by the Shipbuilding Division relating to payment milestones for a vessel contracted for sale. In addition, the impairment loss in prepayments recognized in the previous nancial year was reversed during the nancial year under review after the Group successfully negotiated for the prepayment to be applied towards ongoing projects. Stocks and work-in-progress decreased substantially as the Group completed and delivered vessels to buyers during the nancial year under review. Group net cash of $209 million at 30 June 2010 was $107 million or 105% higher than the previous nancial year end. Accelerated vessel sales/disposals at competitive prices improved the Groups liquidity position.
TOTAL LIABILITIES AND SHAREHOLDERS FUND ($ MILLION)
1,200
1,000
800
600
400
200
0
2006 2007 2008 2009 2010
Shareholders fund Other liabilities Bank borrowings Trade creditors and accruals Minority interests Total
319 64 64 66 1 514
378 78 31 114 0 601
439 96 204 120 0 859
375 133 370 114 0 992
479 113 360 53 0 1,005
Group shareholders funds increased from $375 million at 30 June 2009 to $479 million at 30 June 2010. The increase was attributable to retained prots for the year. Group total liabilities of $526 million at 30 June 2010 were $91 million or 15% lower than the previous nancial year. Trade creditors and accruals reduced by $61 million as the Group paid down its accounts payables.
GROUP RESULTS FOR THE PAST FIVE FINANCIAL YEARS Financial Year Ended 30 June Group revenue Prot before tax Prot attributable to shareholders Earnings per share (cents) Net asset backing per ordinary share (cents) Total Assets Shareholders fund 2006 $000 306,190 127,868 107,328 14.20 41.93 514,355 318,619 2007 $000 307,638 135,125 120,774 15.80 49.10 601,285 377,743 2008 $000 307,164 168,948 149,750 19.43 56.83 858,702 438,504 2009 $000 263,171 8,138 1,195 0.15 48.64 992,144 375,383 2010 $000 357,063 122,351 103,715 13.44 62.06 1,005,058 478,884
CORPORATE INFORMATION
BOARD OF DIRECTORS Tang Kok Yew (Chairman) Chan Mun Lye (Chief Executive Ofcer) Chan Fook Kong (Executive Director) Mok Weng Sun (Non-Executive Director) Chung Thian Siang (Non-Executive Director) Lim Jiew Keng (Independent Director) Liow Keng Teck (Independent Director) Goon Kok Loon (Independent Director) EXECUTIVE COMMITTEE Chan Mun Lye (Chairman) Chan Fook Kong Mok Weng Sun AUDIT COMMITTEE Lim Jiew Keng (Chairman) Mok Weng Sun Liow Keng Teck NOMINATION COMMITTEE Liow Keng Teck (Chairman) Tang Kok Yew Lim Jiew Keng
REMUNERATION COMMITTEE Goon Kok Loon (Chairman) Mok Weng Sun Liow Keng Teck COMPANY SECRETARY Yeo Poh Noi Caroline REGISTERED OFFICE 13 Tuas Crescent Singapore 638707 Telephone: (65) 6265 1010 Facsimile : (65) 6864 5555 Email : enquiry@jayaholdings.com Website : http://www.jayaholdings.com SHARE REGISTRAR Boardroom Corporate & Advisory Services Pte. Ltd. 50 Rafes Place #32-01 Singapore Land Tower Singapore 048623 Telephone: (65) 6536 5355 Facsimile : (65) 6536 1360
AUDITORS Ernst & Young LLP One Rafes Quay North Tower, Level 18 Singapore 048583 Partner: Philip Ling (appointed since FY2008) PRINCIPAL BANKERS Australia and New Zealand Banking Group Limited BNP Paribas CIMB Bank Berhad Citibank N.A. Commerzbank Aktiengesellschaft DBS Bank Ltd KBC Bank N.V. Malayan Banking Berhad Oversea-Chinese Banking Corporation Limited PT. Bank Mandiri (Persero) Tbk PT. PermataBank Rabobank International RHB Bank Berhad Standard Chartered Bank The Hongkong and Shanghai Banking Corporation Limited The Royal Bank of Scotland N.V. United Overseas Bank Limited
CORPORATE GROUP STRUCTURE
JAYA HOLDINGS LIMITED
100%
Jaya Offshore Pte Ltd
100%
Airia Jaya Marine (S) Pte Ltd
100%
AJM Shipping Pte Ltd
100%
Java Marine Lines Pte Ltd
100%
Jaya International Transport Pte Ltd
100%
Jaya Shipbuilding and Engineering Pte Ltd
100%
P.T. Jaya Asiatic Shipyard
100%
Jaya Offshore (H.K.) Ltd
35%
Batamindo Carriers Pte Ltd
100%
JSE Shipping Pte Ltd
50%
Jaya DMS Marine Pte Ltd
100%
Nantong Dongjiang Shipyard Company Limited
49%
DMS Jaya Marine W.L.L
The above Group structure includes only active subsidiaries and associated companies as at 30 June 2010. A full listing of the Groups investments is disclosed under item 5 of notes to the nancial statements.
CHAIRMANS STATEMENT
I am pleased to report on behalf of the Board that the nancial performance of the Group has been commendable and above expectations. We have managed to turn in a Net Prot attributable to shareholders of S$103.7 million compared with a prot of just S$1.2 million in the previous nancial year.
CHAIRMANS STATEMENT
DEAR SHAREHOLDERS THE BUSINESS ENVIRONMENT We commenced our nancial year (FY 2010) which ended 30 June 2010 in the face of a rather difcult and uncertain economic environment caused by the Global Financial Crisis. The sombre mood of the global community, shared alike by political and business leaders as well as the ordinary man in the street, was clouded by fear of a severe and prolonged Great Depression-style economic and financial downturn. Fortunately, the two large and increasingly important countries, China and India, continued to demonstrate their economic dynamism and resilience. These two countries were able to sustain their strong economic growth (partly due to massive stimulus policies) and in so doing helped to partly counter the depth and severity of the global crisis. Credit must also be attributed to the governments around the world which had launched prompt and wide-ranging scal initiatives to arrest the plunging economic situation and subsequent loss of condence. These initiatives, which included bold and massive scal and monetary counter measures, have since proven to be effective and helped to prevent a total nancial meltdown and a prolonged economic crisis. Notwithstanding the respite and relatively lighter pain that the world has endured compared to what was expected at the outset of the global crisis, the past one year has not been easy for most business enterprises. The ensuing deep recession left few countries untouched, there were major job losses and, at one time, nancing markets seized up. The offshore and marine industry was not spared the crisis and had to face a challenging time. Although the price of crude oil has since stabilized from its low of below USD 40 per barrel at the initial stage of our nancial year to its current range of between USD 70 to USD 80 per barrel by June 2010, the pick up in the industrys activities has not been sufciently robust. The demand for offshore support vessels has consequently not been recovering well since its drastic fall from the peak of 2007/08. The continuous coming on stream of new buildings which were contracted during the pre-crisis period meant that demand was quickly met and an oversupply situation existed throughout the year.
In spite of such adverse conditions under which the Group had operated during the nancial year, I am pleased to report on behalf of the Board that the nancial performance of the Group has been commendable and above expectations. We have managed to turn in a Net Prot attributable to shareholders of S$103.7 million compared with a prot of just S$1.2 million in the previous nancial year. OVERCOMING OUR FUNDING CHALLENGES In last years report, I had to explain the additional challenges the Group had to face besides having to bear the severe impact of the Global Financial Crisis. I would like to briey recapitulate these challenges and provide an account of where we are today with respect to those which are company-specic. As part of our dual-pronged business strategy as a fleet operator and shipbuilder of offshore support vessels (OSVs), we had embarked on a long range new building programme based on the then robust growth prospects of the oil and gas industry, before such prospects were drastically over-ridden by the ensuing Global Financial Crisis. Orders for the vessels main engines and other key equipment had to be placed well in advance as their delivery lead times were then in excess of 24 months. Demand for our vessels was adversely affected as activity in the oil and gas industry dramatically slowed down. Compounding the already difcult situation was that our building programme was reaching a peak in its funding requirements. This unfortunately coincided with the drastic tightening of credit market conditions. The negative outlook in the marine sector had also caused some of our lenders to express reluctance to roll over or extend credit facilities granted to the Group, which caused severe strains to our capital structure and cashow. To overcome these challenges, we embarked on a threepronged strategy to address the situation we had found ourselves in. Firstly, we sought to recongure our newbuilding programme, through a vigorous process to cancel or defer our commitments as much as possible so as to alleviate our cash outow requirements. Secondly, in order to ensure that the Group has in place an appropriate capital structure to support its revised build programme, we also embarked on a major
CHAIRMANS STATEMENT
restructuring exercise on the Groups indebtedness. The third prong of the strategy was to step up our efforts to accelerate vessel sales and disposals to build up our cash reserves.
million compared with S$441.2 million recorded in the previous nancial year. FINANCIAL RESULTS
In respect of our efforts to reconfigure the new build programme, our management had actively engaged in dialogue with our key equipment suppliers to secure their co-operation in our restructuring efforts. Fortunately, we had a long term relationship with many of them and have been successful in reaching a good level of project cancellations and deferments. In anticipation of costs to be incurred with this reconguration exercise, we had in the prior nancial year recognized impairment losses and provisions for associated costs for less viable projects. Following the reconguration of our build programme, we have managed to write back a portion of the impairment losses and provisions during the nancial year under review.
Revenue The Group recorded total revenue of $357.1 million which was 36% higher than the previous nancial year. The Shipbuilding Division recorded revenue of $293.0 million, or 70% higher than the previous nancial year. This was achieved from 11 vessels sold as compared to 7 vessels in the previous year. The Offshore Shipping Division however recorded lower revenue of $64.1 million or 29% lower than that of the previous year. A combination of lower eet utilization of 71% (FY09: 83%) and a smaller eet size which was 21 vessels as at 30 June 2010 compared with 24 vessels a year ago, accounted for the lower revenue in this division. Net Prot
As previously announced, the Group had appointed nTan Corporate Advisory Pte Ltd as its nancial advisor to assist and advise the Group in its debt restructuring exercise. The Company and three of its key subsidiaries (being Jaya Shipbuilding and Engineering Pte Ltd, Java Marine Lines Pte Ltd and Airia Jaya Marine (S) Pte Ltd) each presented a debt restructuring plan to the High Court of Singapore on 13 August 2009. Through frank and highly interactive working relationships with our lenders, these schemes of arrangement in their nal form have each been approved unanimously by the scheme creditors present and voting on 28 January 2010 and sanctioned by the High Court of Singapore on 9 February 2010. These schemes took effect from 25 February 2010. Accordingly, the Groups unsecured bank borrowings have been restructured into 5-year USD-denominated secured obligations under acceptable terms. The approved debts are secured by various xed and oating charges over the assets of the Company and its three subsidiaries as above mentioned. We have also done well in regard to our third strategic thrust of stepping up efforts to accelerate vessel sales and disposals. Despite the tougher and more competitive landscape in the sale and purchase market for offshore support vessels, we had managed to sell or dispose of 19 vessels during the nancial year at competitive prices, which is the same number as achieved in the prior nancial year. Total gross proceeds from the sale and disposal of the 19 vessels amounted to S$421.5
The Groups Net Prot attributable to shareholders was $103.7 million, a significant improvement over the $1.2 million recorded in the previous nancial year. The $103.7 million net prot for the nancial year included restructuring costs of $28.3 million, provision or impairment charges and associated shutdown costs on the Nantong Dongjiang Shipyard of $14.1 million and write-back of provision for cancellation/deferment costs of $23.4 million charged in the previous nancial year, after the associated projects were nalized. Excluding these non-recurring charges, Net Prot for the nancial year under review would have been $122.7 million. In the previous nancial year, the reported $1.2 million was after impairment losses and provisions for associated costs of $99.4 million, $71.0 million in forex and translation losses which resulted from the Group entering into forex contracts and hedging its foreign currency denominated costs relating to its shipbuilding programme. Excluding the impairment losses and provisions for associated costs, the Groups Net Prot for the previous nancial year would have been $100.6 million. Dividends I regret to advise that the Board is unable to recommend a payment of a dividend for the nancial year under review. Under the schemes of arrangement agreed with the scheme creditors, the payment of any dividend is subject to certain
CHAIRMANS STATEMENT
conditions to be met by the Company. These include stipulations that dividends can only be paid out of any increase in paid up capital since the effective date of the schemes and an equal amount must rst be prepaid to scheme creditors. The Boards present focus is to restore the Group to a sound and solid nancial footing so as to be able to meet its shipbuilding commitments and installment repayments under the schemes of arrangement. Outlook and Prospects The ship chartering market was weak during the year under review and we expect such challenging conditions to remain for most of the current year as it will take time for the market to work out the oversupply situation. Charterers are getting the benet of having to choose from a wider pool of available vessels for any one project due to the expansion of the global fleet as more new buildings are progressively completed and join the already crowded supply pool. These factors will continue to limit charter rate growth and charter tenure length as charterers become more condent with relying on spot charters to optimize their productive usage of vessels once chartered in. Although we do not anticipate any signicant pick-up in new building undertakings by eet owners, the sale and purchase activities for nearly completed or recently completed vessels should remain active. The industry downturn affecting offshore support vessels has already pushed down their asking prices significantly from their previous peak in 2007 and serious ship-owners and operators are not optimistic there is much more scope for bottom-shing. Those with an ageing eet needing renewal or those operators with good prospects for protably deploying their vessels should be in a better position to start rejuvenating or expand their eets, now that the vessel nancing market has recovered somewhat. We remain condent that the longer term fundamentals of the oil and gas industry will remain positive, underpinned by continuing world energy demand growth. Inasmuch as renewable energy has been heralded as a clean and growing energy source, fossil fuel will remain very much the dominant source of energy for the world in the foreseeable future. To put ourselves in a better position to address the requirements of the oil and gas industry and prepare for an anticipated pick
up in activity in the industry some time in the future, we have also focused our attention on sharpening our competitive edge through improving our work processes. To this end, we have implemented an Enterprise Resource Planning (ERP) system using SAP software to integrate our production planning, materials control and nancial reporting systems. Another area we have been putting emphasis on is raising our health, safety, security and environmental standards, and awareness of such standards and practices among our workforce.
ACKNOWLEDGEMENT AND APPRECIATION I am grateful to our Board of Directors for their invaluable counsel and contributions in navigating the company safely through the very challenging conditions of the past year. On behalf of the Board, I wish also to thank our shareholders for their patience and continued support of the Companys efforts to stabilize and improve the business. Our appreciation also goes to our loyal equipment suppliers and subcontractors who so admirably stood by us during these difcult times. Our banks have also been supportive and understanding and for that, we would like to thank them. Last but not least, to members of the management and general staff of the company, the past year has been a year full of intense work activities and I know most of you had put in very concerted efforts. Rest assured that your Board is aware of your loyalty, commitment and hard work during the past year and on its behalf, let me convey our deep sense of appreciation.
TANG KOK YEW CHAIRMAN 18 September 2010
BOARD OF DIRECTORS
TANG KOK YEW

Malaysian, 57
CHAN MUN LYE

Singaporean, 59
CHAN FOOK KONG

Singaporean, 61
He is the Chairman of the Group and a member of the Nomination Committee. Mr Tang joined UBS Capital as Chairman, Asia Pacic in 1999 before co-founding Afnity Equity Partners in 2002. Prior to UBS Capital, he was the Chief Executive for Investment Banking, East Asia at Union Bank of Switzerland in 1995. Following the merger of Union Bank of Switzerland and Swiss Bank Corporation to form UBS, Mr Tang became Chief Executive, Hong Kong, of UBS Group and Asia Regional Head of Investment Banking for UBS Investment Bank. Prior to UBS, he served in a number of senior roles over 20 years in Banque Indosuez Group and Chase Manhattan Bank. Mr Tang holds a Bachelor of Economics (Accounting) Degree with First Class Honours from the University of Malaya.
He is Chief Executive Ofcer of the Group and also sits on the Executive Committee. Mr Chan is a Chartered Engineer (UK) and has a Diploma in Mechanical Engineering, an Extra First Class Engineer (UK) qualication and is a Fellow of the Institute of Marine Engineering, Science & Technology (London). Mr Chan joined the Group in 1982 as one of its founding shareholders and prior to that, he had 12 years of experience in the shiprepair, shipowning and operations, including 5 years as a marine engineer with various shipping companies. Mr Chan is responsible for the overall business development and management of the Group.
He is the Executive Director and a member of the Executive Committee. Mr Chan is a FCPA Singapore and has a Bachelor of Accountancy from the University of Singapore. Prior to joining the Group in 1993, he had over 20 years of experience with several multinational companies rising from accountant to nance director positions. He is responsible for the business development and strategic planning of the Group and its corporate services.
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BOARD OF DIRECTORS
MOK WENG SUN

Malaysian, 43
CHUNG THIAN SIANG

Singaporean, 38
LIM JIEW KENG

Singaporean, 70
He is a Non-Executive Director and a member of the Executive, Audit and Remuneration Committees. Mr Mok is a Partner of Afnity Equity Partners. Prior to that, he was a Partner at UBS Capital Asia which he joined in 1997, having previously worked with CF East Asia, a boutique nancial advisory practice. Prior to joining CF East Asia, Mr Mok spent six years in business development and nance roles with Eastman Holdings, an engineering group in South East Asia with interests in marine-related construction services and factory automation. Mr Mok holds a Bachelor of Science Degree in Industrial & Management Engineering and an MBA degree from Rensselaer Polytechnic Institute in New York, USA.
She is a Non-Executive Director of the Group and was appointed to the Board on 30 September 2008. Ms Chung is an Executive Director of Afnity Equity Partners. Prior to joining Afnity Equity Partners, she was an Investment Manager in the asset management subsidiary of the Great Eastern Life group of companies in Singapore, and a Senior Manager in the Corporate Finance Division in Singapore Power Limited. From 1997 to 2000, she worked in the Investment Banking Division of UBS, executing a variety of corporate finance transactions in South East Asia. From 1995 to 1996, she worked in Deutsche Bank (formerly Morgan Grenfell), advising on project finance transactions. Ms Chung holds a degree in Accountancy with Second Upper Class Honours from Nanyang Technological University, Singapore.
He is a Non-Executive and Independent D i re c t o r, C h a i r m a n o f t h e A u d i t Committee and a member of the Nomination Committee. Mr Lim has a Bachelor of Social Science degree (Economics, Honours) from the University of Singapore and had completed an Advanced Management Programme at Duke University (USA). Currently a director and senior consultant at BSL Consultants Pte Ltd, Mr Lim has had extensive experience in the nancial and banking industry. Besides his appointments with the Company, he is also on the board of two other listed companies, namely GP Batteries International Limited and Surface Mount Technology (Holdings) Limited. Mr Lim is a member of the Singapore Institute of Directors.
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BOARD OF DIRECTORS
LIOW KENG TECK

Singaporean, 69
GOON KOK LOON

Singaporean, 67
He is a Non-Executive and Independent Director, Chairman of the Nomination Committee and a member of both the Audit and Remuneration Committees. Mr Liow has a Degree in Mechanical Engineering (Honours) from the University of Singapore and is also a registered Professional Engineer (Singapore). Before going into private practice as an engineering consultant in 1997, Mr Liow was with the Public Utilities Board, as Managing Director of Development Resources Pte Ltd, its engineering consultancy arm. He also sits on the boards of Manhattan Resources Ltd and several unlisted companies. Mr Liow is also a member of the Singapore Institute of Directors.
He is a Non-Executive and Independent Director and Chairman of the Remuneration Committee. Mr Goon holds a Degree in Electrical Engineering (First Class Honours) from the University of Liverpool (UK) and is a Fellow of the Chartered Institute of Logistics & Transport, FCILT. Mr Goon was President (International Business) in PSA Corporation Ltd when he left in 2003. He is currently Executive Chairman of Global Maritime and Port Services Pte Ltd. In addition, Mr Goon sits on the boards of Venture Holdings Ltd, Yongnam Holdings Ltd and Jurong Port Pte Ltd.
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KEY EXECUTIVES
FINANCE DIVISION
Thai Kum Foon Chief Financial Ofcer Koh Ai Chin Financial Controller
SHIPBUILDING/SHIPREPAIR DIVISION
Lim Siew Koon President Kwan Seng Fatt Senior Vice President (Engineering) Lau Chor Hua Senior Manager - Singapore Yard Andy Tan Senior Manager - Batam Yard Daniel Teng Senior Manager - China Yard Lee Boon Chye Project Manager
OFFSHORE SHIPPING DIVISION

Marketing Philip Tan Manager Operations Capt. Baharrudin Bin Ali Manager Engineering Support Koh Hwee Sen Senior Manager
CORPORATE SERVICES DIVISION

Admin/HR Ginny Soh Group Manager Sean Ong Manager - Batam Yard Purchasing Toh Tong Seng Manager Legal/Contract Justin Chia Manager Internal Audit Desmond Tin Manager
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REVIEW OF OPERATIONS
14
OFFSHORE SHIPPING DIVISION The chartering market was weak during the nancial year under review due to the expansion of the global charter eet with new vessels coming on line and is expected to remain challenging in the near term. Although the chartering market experienced an uptick in charter activity early in the year, it will take some time before charter rates recover to previous levels as the oversupply of vessels continues to impact the global charter market. The Offshore Shipping Division operates a relatively young eet due to the continual eet renewal strategy of the Group, which involves the regular sale of older and lower specication vessels and the addition of newer and more sophisticated vessels built by the Groups Shipbuilding Division. The average age of the current eet is 2.6 years, well below the industry average of 20 years. These vessels are primarily involved in assisting other offshore structures and equipment including the positioning of rigs, the handling of anchors and the supply logistics of operating platforms. The Offshore Shipping Division recorded total revenue of $64.1 million, a 29% drop from the previous nancial year of $90.1 million. Fleet utilization was 71% as compared to 83% recorded in the previous nancial year as a result of softer charter market conditions. This was mitigated by an improved average daily vessel charter rate of $12,232, 10% higher than $11,149 in the previous nancial year due to better eet composition. In addition, the Group recently secured two term charter contracts amounting to US$10 million in total for two of its mid-sized AHTS which also contributed to the improved average daily vessel charter rate. Fleet size reduced from 24 vessels a year ago to 21 as at 30 June 2010. Seven vessels were added to the eet of which 2 of them were sold shortly thereafter and a total of 8 vessels was disposed in the current nancial year as the Group capitalized on improved market sentiment and sold/disposed vessels to generate cash to fund its operations and to strengthen the Groups nancial position during the nancial crisis. The Division generated gains of $30.9 million from the disposal of 8 vessels compared to $64.5 million from the disposal of 11 vessels in the previous nancial year. NO. OF VESSELS 15 AVERAGE AGE 2.7
VESSEL TYPE Anchor handling tug and supply vessels / anchor handling tugs
VESSEL DESCRIPTION Transport oileld supplies and equipment Tow, lift and reposition anchors for oil rigs, construction vessels and barges Carry supplies to and from offshore structures and rigs Transportation of goods and personnel to and from offshore oil platforms and other offshore structures Steel barges tted with housing facilities for offshore construction and decommissioning Non-propelled steel barges tted to carry heavy structures and supplies
Utility supply vessels
6.3
Platform supply vessels
0.1
Accommodation work barges
1.0
Deck cargo barges
2.1
21
2.6
15
For the Divisions total chartering revenue, customers from the oil and gas sector accounted for 90%. On the geographical spread where the vessels were employed, the ASEAN countries, comprising of Malaysia, Thailand and Indonesia, collectively accounted for 67% of the total charter revenue. The balance of the charter revenue was contributed by customers from Australia, the Middle East region and distant places including Sakhalin and Russia.
CHARTERING REVENUE BY GEOGRAPHICAL REGION FY2010

Indonesia 27.3% Worldwide 20.4% Australia 4.4% Russia 1.6% Qatar 7.0% Malaysia 14.8 % Thailand 24.5%
CHARTERING REVENUE BY GEOGRAPHICAL REGION FY2009

Indonesia 24.3% Worldwide 26.6% Australia 3.2% Saudi Arabia 2.3% Qatar 16.3% Malaysia 4.6% Thailand 22.7%
The Divisions revenue was contributed 57% by time charter, 37% by bareboat charter of its vessels, with remaining 6% from management fees derived from managing third party vessels and miscellaneous charges such as mobilization fees. About
8% of the revenue was derived from shorter term charters with duration of six months or below, with the balance 92% from longer term charters in excess of six months and up to three years.
CHARTERING REVENUE BY CHARTER TYPE FY2010
CHARTERING REVENUE BY CHARTER TYPE FY2009
Bareboat 36.7% Others 5.9% Time 57.4%
Bareboat 33.2% Others 1.1% Time 65.7%
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The enforcement of Cabotage Law in Indonesia from January 2011 is expected to pose a challenge to non-Indonesian agged vessels. A total of 12 types of vessels will not be allowed for operation by foreign-agged vessels and as such operating permits will no longer be issued. Accommodation barges longer than 250ft, AHT, AHTS, ASD tugboats, PSV, Seismic vessels, Floating Storage and Ofoading / Floating Production Storage and Ofoading units and crane barges greater than 100T will be allowed to operate under foreign ags until the end of 2010 if suitable Indonesian ag vessels are not available in the market. Some oil companies in recent months had started to implement the Indonesian ag requirement ahead of schedule because many of these operators are fearful of the penalty to be imposed. To overcome the challenge, the Group is looking at establishing joint ventures with Indonesian parties to co-own the vessels to meet Indonesian ag requirements. SHIPBUILDING DIVISION At the commencement of the nancial year under review in July 2009, the lingering effects of the global economic and nancial crisis were still imposing considerable uncertainty on the timing of any improvements in the shipbuilding sector. The weak oil price and economic climate had caused players in the oil and gas industry to cut back on their exploration and production (E&P) budgets. New build-to-order activity remained low as the market was still absorbing deliveries of orders made in prior years. The oversupply of vessels had naturally resulted
in charter rate erosion, adding to the disincentive for any new vessel building. The situation stabilized to some extent in the 2nd half of the nancial year under review as ship prices were already marked down and the vessel nancing market was re-establishing itself. Ship owners with stronger nancial muscles were also taking a longer term view resulting in increased buyer enquiries for the Group. In view of the weak shipbuilding market, we undertook a reconguration of our new building programme in conjunction with our exercise to restructure the Groups bank loans. These efforts saw us working closely with our major equipment suppliers to defer delivery of equipment for some of our planned new buildings to later dates. This enabled us to slow the pace of shipbuilding and eased the pressure on the Groups cash ows. Consequently, the Nantong Dongjiang Shipyard facility became surplus to the Groups building capacity requirements. Hence, the Group made a decision to shut the facility. Nevertheless, our Singapore and Batam shipyards remained sufciently active and the workforce was well employed during the nancial year under review. Following the successful restructuring of its bank loans, the Group was well placed to carry out its moderated shipbuilding programme. During the year under review, the Group took delivery of 16 new vessels, namely, 9 Anchor Handling Tug &
17
Supply Vessels (AHTS), 3 accommodation barges, 2 Platform Supply Vessels (PSV), 1 Subsea Operation Vessel and 1 Deck Barge. Of these 16 completed vessels, the Group capitalized on the improved market sentiment and sold 9 vessels upon completion at competitive prices while 7 were added to the Groups charter eet. Of the 7 added to the charter eet, 2 vessels were sold shortly thereafter. The reconguration of the new vessel building programme and the acceleration of vessel sales and disposals contributed to the strengthening of the Groups nancial position. For the nancial year under review, the Division generated revenue of $293.0 million, a 70% increase from $172.5 million in the previous financial year. The Division contributed $62.4 million or 60% of the Groups net prot after tax. In the previous nancial year, the Division recorded a net loss of $74.7 million, after charging $99.4 million of impairment losses and provisions for associated costs and a forex loss of $37.4 million. These impairment losses and provisions were for projects deemed to be less viable at that time. Very active negotiations with our equipment vendors were carried out in regard to cancellation and/or deferment of equipment deliveries. As a result, the Division was able to write back $23.4 million of the provision for cancellation/deferment costs during the nancial year under review. The demand for oil and gas is expected to increase as the global economy recovers and industries increase their pace of activities. The emerging economies of China, India and the Middle East are expected to increase their energy consumption, for both industrial and retail consumers. The International Energy Agency forecasted that the global oil demand will increase from 84.7 million barrels per day in 2009 to 87.9 million barrels per day in 2011. Given the estimated depletion of oil reserves from onshore and shallow water wells of about 5-7% per annum (source: UK Energy Research Centre Aug 2009 and Maritime Reporter), oil prices are expected to remain stable and high. Increased stability in oil prices around the range of US$70 to US$80 per barrel provides support for increased exploration and production spending which is likely to increase the demand for offshore support vessels. E&P spending in 2010 by the oil majors is expected to revert to the level of 2008 after experiencing a Vessel type AHTS ~ 5,000 BHP ~ 8,000 BHP ~ 12,000 BHP ~ 16,000 BHP PSV Sub-sea diving / ROV support vessels Barges Total projects 1 2 16 14 Projected Completion FY11 13 6 7 4 4 2 2 2 FY12 - FY14 10 Total 23 6 11 4 2 2 3 2 30 brief dip of 8% (source: DnB NOR May 2010) in 2009. The jackup and semisubmersible drilling rigs contracted in prior years are also expected to be delivered in 2010 and 2011 and are mainly planned for deepwater operation. Thus, E&P activities are projected to move into deepwater areas and the demand for vessels capable of operating in harsh weather environment will likely see an upturn. The Group is committed to building more powerful and technically advanced vessels to meet more stringent demands of eet owners and operators. As at 30 June 2010, the Group had a shipbuilding programme of 30 vessels:
18
OUR SHIPYARDS: SINGAPORE SHIPYARD BATAM SHIPYARD
Location: Tuas, Singapore Size: 24,939 sqm Shoreline: 130m Berths: - Two 90 x 20m berths - One 75 x 20m berth Capacity: Build up to 3 vessels per year Capability: Build highly-customized and sophisticated offshore vessels Type of vessels: - 8,000 to 16,000 BHP AHTSs - PSVs
Location: Batam, Indonesia Size: 181,038 sqm Shoreline: 320m Berths: - Five 100 x 20m berths Capacity: Build commercial and customized vessels Type of vessels: - 5,000 to 10,000 BHP AHTSs - Accommodation barges - Sub-sea diving / ROV support vessels
19
CONVENTIONAL SHIPPING DIVISION This division has been dormant since the last vessel in this Division was disposed of in November 2008. CORPORATE AFFAIRS AND HUMAN RESOURCES Human Resource As at 30 June 2010, the Group had a total headcount of 440 direct employees working in its corporate ofce and three wholly owned shipyards in Singapore, Indonesia and China. In addition, the Group worked closely with a pool of subcontractors who are each dedicated to specic work scopes in the shipbuilding process such as hull structure, mechanical and electrical installation, accommodation modules and painting. In our vessel chartering operations, we had 288 crew members on seamen contracts who, like the subcontracted workers, are also not included in our direct headcount. The Group strives to continually increase and sharpen its competitive edge with continuous learning and development programmes for the staff. We recognize our employees are our key assets through whom the Groups corporate goals and visions can be shared and worked towards attainment. During the year, we aimed to develop team spirit among the staff through various formal communication sessions between management and staff as well as employee recreation and social functions. To improve and streamline the various work processes within the organization, the Group implemented an integrated Enterprise Workplace Health and Safety Our employees must be able to enjoy a working environment where risks to personal safety and good health are constantly identified and eliminated to the greatest extent possible. The Group has identied several corner stones and key concepts from which it radiates its human resource management strategies, as elaborated below. Even as we strive towards constant process improvements, we will continue to place strong emphasis on promoting a close-knit, conducive and safe working environment for all our employees so that a high level of motivation and satisfaction comes with their jobs. Resource Planning system. This system went live in August 2010. The company will continue to invest in the training of our employees so that they are equipped with the right skills to perform their work and grow their careers with the Group.
20
Besides encouraging employees to think of the company as one happy family to work with, we are obliged to ensure that each employee returns safely at the end of each day to his or her own family at home. The Group is therefore committed to promoting safety awareness among its staff and subcontractors. These are regularly carried out through in-house safety talks and training for our employees and sub-contractors working in our yard. Our Safety Committee includes members from various work departments and functions. This is to ensure a wider representation of views and in so doing we hope to reach out to a wider awareness among employees that safe practices are responsibilities owed by each employee to the rest of his fellow employees. Motivation and Reward The Group regularly reviews and enhances its benets and compensation terms with reference to those of its industry peers. This is to ensure that the Groups employment terms are competitive and enable the Group to retain its key employees. A well motivated workforce will ensure that targets are aggressively pursued and each employee will give his best performance. We are committed to nurturing our workforce to their fullest potential with suitable training programmes and deserving employees are identied and given promotions or enlargement of their job scopes. The Group continues to collaborate and support the local polytechnics and technical institutes through sponsorship programmes for their top students. Team Spirit at Work We recognize the importance of team spirit as a key driver in ensuring that organizational goals and objectives are met. Besides interacting through formal work routines and meetings, we believe that team spirit can also be cultivated through a lighter vein when employees are involved in company social events. Such events at Jaya include Christmas lunch, lunar new year Lo Hei, Fruity Nite with durians as the main draw and bowling competitions. These events see wide enthusiasm and participation from all levels of the workforce. Compliance with International Operating Standards. Being a provider of vessels for the oil and gas industry, we take great care to ensure that our operating standards meet with the We are committed to keeping our shareholders and the investing community updated promptly on signicant events through regular announcements and analyst briengs, including key developments of our nancial restructuring exercise which was carried out during the year. Each of our quarterly results was supported by an analyst brieng. The results and brieng materials were also posted on our website, which was recently revamped to enhance user interface. Investor Relations The Group is committed to the creation of long term value for its loyal shareholders, despite that its business is affected on a macro level by the cyclical nature of the oil and gas industry. The global economic crisis which rst started in September 2008 had adversely affected the industry. For the previous nancial year ended 30 June 2009, we had a dismal performance with a Return on Equity (ROE) of 0.3% but for the nancial year under review, we have bounced back strongly with a ROE of 24.3%. exacting demands of the industry. Our operations are guided by well dened and documented manuals and procedures with which our personnel are well familiarized. The Group recognizes the need to meet customers satisfaction and abide strictly to the requirements of the QEHS (Quality, Environment, Health and Safety Standard), which is vital to our business. We are committed to be fully in compliance with ISO9001:2008, ISO14001:2004, OHSAS18001:2007 and ISM Certication at all times.
21
CORPORATE GOVERNANCE
REPORT ON CORPORATE GOVERNANCE Jaya Holdings Limited (the Group or Company) is committed to maintaining a high standard of corporate governance within the Group to promote accountability, transparency and corporate fairness. The Group adopts practices based on the Code of Corporate Governance 2005 (the Code) where it is applicable and practical to the Group and the Best Practices Guide issued by the Singapore Exchange Securities Trading Limited (the SGX-ST). Good corporate governance establishes and maintains a legal and ethical environment in which the Group strives to preserve the interests of all stakeholders. This statement outlines the main corporate governance practices that were in place or implemented during the nancial year: BOARD OF DIRECTORS The primary functions of the Board are to:(i) (ii) oversee the business affairs of the Group, provide entrepreneurial leadership to Management and confer with them regularly; evaluate and set strategic aims and ensure that the necessary nancial and human resources are in place for the Company to meet its objectives; (iii) (iv) (v) establish a framework of prudent and effective controls which enables risk to be assessed and managed; monitor and review management performance; and set the Companys values and standards and ensure that obligations to shareholders and others are understood and met.
The Board currently has eight members, comprising six non-executive Directors (including the Chairman) and two executive Directors. Three of the six non-executive Directors are considered independent by the Nomination Committee. The nature of each directors appointment on the Board and its Committees are set out below: Committee Membership Director Tang Kok Yew Chan Mun Lye Chan Fook Kong Mok Weng Sun Chung Thian Siang Lim Jiew Keng Liow Keng Teck Goon Kok Loon Nature of Board Membership Non-Executive Chairman Chief Executive Ofcer Executive Director Non-Executive Director Non-Executive Director Independent Director Independent Director Independent Director Chairman Member Member Chairman Member Chairman Member Member Audit Nomination Member Chairman Member Member Remuneration Executive
The Board is made up of individuals with a good balance of professional, technical and nancial backgrounds with requisite blend of expertise, skills and attributes to oversee the Companys growing businesses. The Directors take a keen interest in the Groups business strategies and are committed to increasing the level of corporate governance in the Group so as to enable the Board to carry out such functions more effectively.
22
To enable the Board to fulll its responsibilities, Management provides the Board with regular management and nancial reports containing complete, adequate and timely information prior to Board meetings. Should the Directors, whether as a group or individually, need independent professional advice, the Company will, upon direction by the Board, appoint a professional advisor to render such advice. Newly appointed Directors are briefed by Management on the business activities of the Group and its strategic direction and will also be updated on major events of the Group. The roles of the Non-Executive Chairman and the Chief Executive Ofcer (CEO) are separate. There is a clear division of responsibilities between the two Directors. The Non-Executive Chairman leads the Board to ensure its effectiveness and sets the agenda. He facilitates the effective contribution of non-executive Directors and encourages constructive relations between the Board and Management. The CEO focuses his attention on the day-to-day running of the operations. The Company Secretary attends all Board meetings and ensures that Board procedures are followed. The Company Secretary also ensures that requirements of the Companies Act and all the rules and regulations of the SGX-ST are complied with. The Company Secretary also facilitates an open and regular ow of communication between the Company and the SGX-ST and the Accounting & Corporate Regulatory Authority. The Board has a process for assessing the effectiveness of the Board as a whole and the contributions of individual Directors. The process, managed by the Nomination Committee, comprises an assessment of both qualitative and quantitative criteria. The results of the evaluation are used to identify areas for improvement in the discharge of the Boards duties. This annual process is the principal means by which the Board monitors performance and makes continuous improvements to the effectiveness of the Board. All Directors are subject to retirement and re-election at least once every three years. Annually, the Nomination Committee determines the independence of Directors according to the criteria stipulated in the Code based on each Directors declaration. EXECUTIVE COMMITTEE The Executive Committee was formed on 17 March 1998 with a view to assisting the Board and is responsible for supervising the management of the Groups operations within limits of the executive power delegated by the Board. As at the date of this report, the Executive Committee comprises the Chief Executive Ofcer, Mr Chan Mun Lye, Executive Director, Mr Chan Fook Kong and the Non-executive/Non-independent Director, Mr Mok Weng Sun. The Executive Committee carries out any instructions which the Board gives from time to time and meets regularly to review the progress of corporate development projects and business performance. It is responsible for the day-to-day operations of the Group and meets regularly with Senior Management to discuss both policy and operational issues, and to implement Board decisions. AUDIT COMMITTEE As at the date of this report, the Audit Committee comprises three members, all of whom are non-executive/independent and nonindependent Directors. They are: Lim Jiew Keng Liow Keng Teck Mok Weng Sun Chairman/Independent Independent Non-independent
23
The Audit Committee meets at least four times a year and performs the following functions: (i) (ii) reviews with the external auditors their audit plans and results of the audit; reviews the draft nancial statements of the Company and the Group in conjunction with the external auditors comments thereon prior to their submission to the Board of Directors; (iii) (iv) (v) (vi) (vii) reviews the reports of the internal auditor; reviews the internal control procedures of the Company; reviews interested person transactions in accordance with the requirements of the SGX-STs Listing Manual; reviews the external auditors management letter and the response from management; and carries out special purpose projects to assist Management in performing evaluation and decision making.
The Audit Committee, having reviewed all non-audit services provided by the external auditors, Messrs Ernst & Young LLP, to the Group, is satised that the nature and extent of such services would not affect their independence and has recommended the re-appointment of Messrs Ernst & Young LLP as auditors at the forthcoming Annual General Meeting. To carry out its functions, the Audit Committee reports regularly to the Board and interacts with the external auditors and senior management staff. It also meets with the external auditors without the presence of management staff at least once a year. The Company has implemented a whistle blowing policy which provides well-dened and accessible channels in the Group through which the employees may raise concerns about improper conduct within the Group and possible improprieties in matters of nancial reporting, operation or other matters. The staff can disclose information directly to the Chairman of the Audit Committee, or through the Internal Audit Ofce, and are assured that they are protected to the extent possible, from reprisals for reports made in good faith. The Audit Committee will ensure independent investigations of such matters are carried out with appropriate follow-up action. REMUNERATION COMMITTEE The Remuneration Committee was established on 3 June 2002 and meets at least once a year. As at the date of this report, it comprises the following three members:Goon Kok Loon Liow Keng Teck Mok Weng Sun Chairman/Independent Independent Non-independent
During the nancial year, the Remuneration Committee had reviewed and approved:(i) (ii) the executive Directors and senior managers remuneration packages; and the Directors fees payable to the non-executive Directors, having regard to the roles that each Director plays. The Directors fees are submitted for shareholders approval at the Annual General Meeting.
24
The Remuneration Committee also determines the eligibility of participants in the Jaya Employees Share Option Scheme (Scheme) and the number of options to be offered to each participant in accordance with the terms and conditions of the Scheme. A summary of Directors remunerations for nancial year ended 30 June 2010 is as follows:
Remuneration Band & Name of Director $250,000 and above Chan Mun Lye Chan Fook Kong Below $250,000 Tang Kok Yew Mok Weng Sun Chung Thian Siang Lim Jiew Keng Liow Keng Teck Goon Kok Loon
Salary %
Fees %
Bonus %
Other benets %
Total %
31 34
69 66
100 100
100 100 100
100 100 100
The remuneration of ve ofcers, not being Directors, who received the highest emoluments during the nancial year ended 30 June 2010, is provided in the following table:
Remuneration Band & Number of Ofcers Above $250,000 3 Below $250,000 2
Salary %
Bonus %
Other benets %
Total %
37
56
100
52
42
100
None of the immediate family members of a Director or of the CEO was employed by the Company and its related companies in a managerial position for the nancial year ended 30 June 2010. NOMINATION COMMITTEE The Nomination Committee was established on 3 June 2002 and comprises the following three members: Liow Keng Teck Tang Kok Yew Lim Jiew Keng Chairman/Independent Non-independent Independent
25
The Nomination Committee meets at least once a year and its principal functions are as follows: (i) reviews and makes recommendations in the appointment and re-appointment of Directors to the Board, based on the criteria set out in the selection matrix which was adopted by the Nomination Committee in 2006; (ii) decides on and proposes to the Board, for approval and implementation, the assessment process including determining a set of performance criteria for evaluating the Boards performance from year to year; (iii) evaluates the Boards effectiveness as a whole and the contribution of each Director to the effectiveness of the Board in accordance with the assessment process and performance criteria mentioned above; (iv) determines annually the independence of each Director in accordance with the guidelines on independence as set out in the Code. The Chairman will then act on the results of the evaluation and where appropriate, propose new members to be appointed or accept the resignation of directors, in consultation with the Board as a whole. ASSESSMENT OF INTERNAL CONTROLS The Board has ultimate responsibility for the systems of internal control maintained by the Group and for reviewing their effectiveness. The systems are intended to provide reasonable assurance, but not an absolute guarantee, against material nancial misstatement or loss, and include the safeguarding of assets, the maintenance of proper accounting records, the reliability of nancial information, compliance with appropriate legislation, regulation and best practices, and the identication and containment of business risks. During the nancial year being reported on, the Audit Committee, on behalf of the Board, has reviewed the effectiveness of the Groups framework of internal controls, the principal features of which are as follows: Control environment The key features of the control environment include the terms of reference for each of the Board committees, a clear organisational structure, with documented delegation of authority from the Board to executive management and dened procedures for the approval of major transactions and capital allocation. Risk identication and assessment The Groups systems of internal control have a key role in the identication and management of risks that are signicant to the achievement of its business objectives. The Board has in place a system of business risk management, which has been integrated throughout the Group into the business planning and monitoring processes. The overall risk management process and results are reviewed formally by the Audit Committee and the Board. Control procedures and monitoring systems The Group has a well-developed system of planning and monitoring. Performance against the plan is regularly monitored using a prudent basis of nancial reporting and accounting policies applied consistently throughout the Group. There is regular liaison between executive Directors and operational management and the Board receives regular presentations from the management responsible for each principal business operation. The Group has well-established internal audit, risk management and compliance functions. There are formal procedures in place for both internal and external auditors to report independently conclusions and recommendations to Management and to the Audit Committee.
26
SECURITIES TRANSACTIONS The Group has a policy on share dealings which sets out the implications of insider trading and has put in place a self regulatory and monitoring mechanism which mirrors substantially the provisions of the Best Practices Guide issued by the SGX-ST. The Group has adopted a code of conduct for dealings in securities of the Company by the Directors and employees, so that the Directors and staff comply with the guidelines of the Best Practices Guide. The Directors and ofcers are not allowed to deal in the Companys shares during the period commencing one month before the announcement of the Groups full year results and ending on the date of the announcement of the full year results. For quarterly results, they are not allowed to deal in the Companys shares during the period commencing two weeks before the announcement of the quarterly results and ending on the date of the announcement of the quarterly results. INTERESTED PERSON TRANSACTIONS The Company has established a procedure for recording and reporting interested person transactions. There are no interested party transactions entered by the Company and its subsidiaries, which are either subsisting at the end of the nancial year or, if not then subsisting, entered into since the end of the previous nancial year. MEETING ATTENDANCE Directors attendance at Board and Board Committee Meetings Audit Committee 4 Nomination Committee 1 Remuneration Committee 1
Meetings of: No. of meetings held in the nancial year ended 30 June 2010 Name & Attendance of Directors Tang Kok Yew Chan Mun Lye Chan Fook Kong Mok Weng Sun Chung Thian Siang Lim Jiew Keng Liow Keng Teck Goon Kok Loon
Board 4
4 4 4 4 4 4 3 4
4 4 4 -
1 1 1 -
1 1 1
On behalf of the Board:
Chan Mun Lye Director Singapore 18 September 2010
Chan Fook Kong Director
27
STATUTORY AND FINANCIAL REPORTS
29 34 35
DIRECTORS REPORT STATEMENT BY THE DIRECTORS INDEPENDENT AUDITORS REPORT CONSOLIDATED INCOME STATEMENT CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
38 39
BALANCE SHEETS STATEMENT OF CHANGES IN EQUITY CONSOLIDATED CASH FLOW STATEMENT NOTES TO THE FINANCIAL STATEMENTS
102 DETAILS OF PROPERTIES 103 SHAREHOLDERS INFORMATION 105 NOTICE OF ANNUAL GENERAL MEETING 107 PROXY FORM
41
36
44
37
DIRECTORS REPORT
The directors are pleased to present their report to the members together with the audited consolidated nancial statements of Jaya Holdings Limited (the Company) and its subsidiary companies (collectively, the Group) and the balance sheet and statement of changes in equity of the Company for the nancial year ended 30 June 2010.
DIRECTORS The directors of the Company in ofce at the date of this report are:Tang Kok Yew Chan Mun Lye Chan Fook Kong Mok Weng Sun Chung Thian Siang Lim Jiew Keng Liow Keng Teck Goon Kok Loon (Chairman) (Chief Executive Ofcer)
ARRANGEMENTS TO ENABLE DIRECTORS TO ACQUIRE SHARES AND DEBENTURES Except as disclosed in this report, neither at the end of nor at any time during the nancial year was the Company a party to any arrangement whose objects are, or one of whose object is, to enable the directors of the Company to acquire benets by means of the acquisition of shares in or debentures of the Company or any other body corporate.
DIRECTORS INTERESTS IN SHARES AND DEBENTURES The following directors who held ofce at the end of the nancial year, had, according to the register of directors shareholdings required to be kept under Section 164 of the Singapore Companies Act, Cap. 50, an interest in shares and share options of the Company and related corporations (other than wholly-owned subsidiary companies) as stated below:At beginning of the nancial year At end of the nancial year
Name of director The Company Ordinary shares held in the name of director and/or nominees Chan Mun Lye Chan Fook Kong Lim Jiew Keng Liow Keng Teck Goon Kok Loon
At 21.7.2010
5,173,587 2,480,000 525,000 1,000,000 10,000
5,173,587 2,480,000 525,000 1,000,000 10,000
5,173,587 2,480,000 525,000 1,000,000 10,000
Share options granted to director to subscribe for ordinary shares of the Company
Chan Mun Lye Chan Fook Kong Lim Jiew Keng Liow Keng Teck 400,000 400,000 345,000 250,000 400,000 400,000 345,000 250,000 400,000 400,000 345,000 250,000
29
DIRECTORS REPORT
DIRECTORS INTERESTS IN SHARES AND DEBENTURES (CONTD) Except as disclosed in this report, no director who held ofce at the end of the nancial year had interests in shares, share options, warrants or debentures of the Company, or of related corporations, either at the beginning of the nancial year or at the end of the nancial year or on 21 July 2010.
DIRECTORS CONTRACTUAL BENEFITS Except as disclosed in the nancial statements, since the end of the previous nancial year, no director of the Company has received or become entitled to receive a benet by reason of a contract made by the Company or a related corporation with the director, or with a rm of which the director is a member, or with a company in which the director has a substantial nancial interest.
SHARE OPTIONS Details of the Jaya Employees Share Option Scheme (formerly known as the Jaya Executives Share Option Scheme) are as follows:(i) The Jaya Employees Share Option Scheme (the ESOS) was approved by the shareholders of the Company at the Extraordinary General Meeting held on 5 September 1994. At the Extraordinary General Meeting held on 28 September 2001, the shareholders approved certain modications to the ESOS to bring the rules of the ESOS approved on 5 September 1994 in line with the amendments introduced by the Companies (Amendment) Act 1998 (CAA) and the amendments to the Listing Manual issued by the Singapore Exchange Securities Trading Limited (SGX-ST) on 6 April 1999. The ESOS, as modied, caters to a larger pool of participants, namely, selected full-time employees, executive directors and non-executive directors of the Group. Participants of the Group who are eligible to participate in the ESOS are not eligible to participate in any other employee share ownership scheme implemented by the Company, and its subsidiary and associated companies. The share options granted to participants are only exercisable after the rst anniversary of the date of grant. The share options granted to employees and executive directors of the Group have a life span of 10 years from the relevant date of grant whilst share options granted to non-executive directors of the Group have a life span of 5 years from the relevant date of grant. However, share options granted prior to 18 November 1998 (being the date that the CAA became operational) only have a maximum life span of 5 years. The subscription price of the share options is determined based on the average of the closing prices of the Companys ordinary shares on the SGX-ST for 5 consecutive trading days immediately preceding the date of grant (the Market Price) or its nominal value, whichever is higher. No discount has been applied to the Market Price in determining the subscription price. The annual maximum allocation of ordinary shares under the ESOS is limited to 9,966,981 ordinary shares, out of which the annual maximum to be allocated to the directors (both executive and non-executive) and employees are 25% and 75% respectively. (iii) The ESOS is administered by the Remuneration Committee which comprises the following directors: Goon Kok Loon Mok Weng Sun Liow Keng Teck
(ii)
30
DIRECTORS REPORT
SHARE OPTIONS (CONTD) (iv) From the commencement of the ESOS to 30 June 2010, no share options have been granted under the ESOS to any controlling shareholders of the Company and their associated companies. The share options granted by the Company do not entitle the holders of the share options, by virtue of such holdings, to any rights to participate in any share issues of any other company in the Group. During the nancial year, no share options were exercised under the ESOS to subscribe for ordinary shares. During the nancial year, no share option was granted under the ESOS to subscribe for ordinary shares.
(v)
(vi) (vii)
(viii) During the nancial year, 50,500, 100,000, 243,900 and 660,000 share options under ESOS Grant Number 9, 10, 11 and 12 were cancelled due to resignation of employees. (ix) Outstanding share options to subscribe for ordinary shares as at 30 June 2010 comprise:Outstanding Options ESOS Grant Number 9 70,500 Exercise price per share $0.769
Exercise period 10 December 2004 to 9 December 2013 6 December 2005 to 6 December 2014 25 November 2006 to 24 November 2010 25 November 2006 to 24 November 2015 30 April 2008 to 29 April 2012 30 April 2008 to 29 April 2017
ESOS Grant Number 10
241,000
$1.020
95,000
$1.238
605,850
$1.238
500,000
$1.456
5,728,000
$1.456
7,240,350
31
DIRECTORS REPORT
SHARE OPTIONS (CONTD) (x) Directors granted options under the ESOS were as follows:Aggregate options granted since commencement of the ESOS to end of the nancial year 2,192,000 634,000 1,370,000 1,370,000 Aggregate options exercised since commencement of the ESOS to end of the nancial year 1,792,000 234,000 1,025,000 1,120,000
Directors Chan Mun Lye Chan Fook Kong Lim Jiew Keng Liow Keng Teck (xi)
Options granted during the nancial year
Aggregate options outstanding at end of the nancial year 400,000 400,000 345,000 250,000
There are no participants who received 5% or more of the total number of options available under the ESOS since the commencement of the ESOS to 30 June 2010. Since the commencement of the ESOS to 30 June 2010, no options have been granted to take up unissued ordinary shares of the subsidiary companies and no ordinary shares of the subsidiary companies have been issued by virtue of the exercise of an option to take up unissued ordinary shares. At the end of the nancial year, there are no other unissued ordinary shares of the Company and its subsidiary companies under options except as disclosed above.
AUDIT COMMITTEE The Audit Committee carried out its functions in accordance with Section 201B(5) of the Singapore Companies Act, Cap. 50, which includes the following:(i) (ii) (iii) (iv) (v) (vi) (vii) reviews with the external auditors their audit plans and results of the audit; reviews the draft nancial statements of the Company and the Group in conjunction with the external auditors comments thereon prior to their submission to the Board of Directors; reviews the reports of the internal auditor; reviews the internal control procedures of the Company; reviews interested person transactions in accordance with the requirements of the Singapore Exchange Securities Trading Limited (SGX-ST)s Listing Manual; reviews the external auditors management letter and the response from management; and carries out special purpose projects to assist management in performing evaluation and decision making.
32
DIRECTORS REPORT
AUDIT COMMITTEE (CONTD) The Audit Committee, having reviewed all non-audit services provided by the external auditors to the Group, is satised that the nature and extent of such services would not affect the independence of the external auditors. To carry out its functions, the Audit Committee reports regularly to the Board of Directors and interacts with the external auditors and senior management staff. It also meets with the external auditors without the presence of management staff at least once a year. Further details regarding the Audit Committee are disclosed in the Report of Corporate Governance as set out in the Annual Report of the Company.
AUDITORS Ernst & Young LLP have expressed their willingness to accept re-appointment as auditors.
On behalf of the Board of Directors:
Chan Mun Lye Director 18 September 2010
33
S TAT E M E N T B Y T H E D I R E C TO R S
We, Chan Mun Lye and Chan Fook Kong, being two of the directors of Jaya Holdings Limited, do hereby state that, in the opinion of the directors:(i) the accompanying balance sheets, consolidated income statement, consolidated statement of comprehensive income, statements of changes in equity and consolidated cash ow statement together with the notes thereto are drawn up so as to give a true and fair view of the state of affairs of the Group and of the Company as at 30 June 2010 and of the results of the business, changes in equity and cash ows of the Group and changes in equity of the Company for the year ended on that date; and at the date of this statement, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they fall due.
(ii)
On behalf of the Board of Directors:
Chan Mun Lye Director 18 September 2010
34
INDEPENDENT AUDITORS REPORT

To the Members of Jaya Holdings Limited
We have audited the accompanying nancial statements of Jaya Holdings Limited (the Company) and its subsidiary companies (collectively, the Group) set out on pages 36 to 101, which comprise the balance sheets of the Group and the Company as at 30 June 2010, the statements of changes in equity of the Group and the Company and the consolidated income statement, consolidated statement of comprehensive income and consolidated cash ow statement of the Group for the year then ended, and a summary of signicant accounting policies and other explanatory notes. MANAGEMENTS RESPONSIBILITY FOR THE FINANCIAL STATEMENTS Management is responsible for the preparation and fair presentation of these nancial statements in accordance with the provisions of the Singapore Companies Act, Cap. 50 (the Act) and Singapore Financial Reporting Standards. This responsibility includes devising and maintaining a system of internal accounting controls sufcient to provide a reasonable assurance that assets are safeguarded against loss from unauthorised use or disposition; and transactions are properly authorised and that they are recorded as necessary to permit the preparation of true and fair prot and loss account and balance sheet and to maintain accountability of assets; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances. AUDITORS RESPONSIBILITY Our responsibility is to express an opinion on these nancial statements based on our audit. We conducted our audit in accordance with Singapore Standards on Auditing. Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the nancial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the nancial statements. The procedures selected depend on the auditors judgement, including the assessment of the risks of material misstatement of the nancial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entitys preparation and fair presentation of the nancial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entitys internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the nancial statements. We believe that the audit evidence we have obtained is sufcient and appropriate to provide a basis for our audit opinion. OPINION In our opinion, (i) the consolidated nancial statements of the Group and the balance sheet and statement of changes in equity of the Company are properly drawn up in accordance with the provisions of the Act and Singapore Financial Reporting Standards so as to give a true and fair view of the state of affairs of the Group and of the Company as at 30 June 2010 and the results, changes in equity and cash ows of the Group and the changes in equity of the Company for the year ended on that date; and the accounting and other records required by the Act to be kept by the Company and by those subsidiary companies incorporated in Singapore of which we are the auditors have been properly kept in accordance with the provisions of the Act.
(ii)
Ernst & Young LLP Public Accountants and Certied Public Accountants Singapore 18 September 2010
35
C O N S O L I DAT E D I N C O M E S TAT E M E N T
for the nancial year ended 30 June 2010
Group Note 2010 $000 2009 $000
Revenue Cost of sales Gross prot Other income General and administrative expenses Other expenses Interest expenses Share of prots of associated companies, net of tax Prot before taxation Income tax expense Prot after taxation Attributable to:Equity holders of the parent Minority interests
357,063 (233,287) 123,776
263,171 (126,719) 136,452 67,567 (8,120) (180,158) (9,726) 2,123 8,138 (6,915) 1,223
37,223 (11,492)
8 9
(19,715) (8,968) 1,527
10 11
122,351 (18,636) 103,715
103,715 103,715
1,195 28 1,223
Earnings per share attributable to equity holders of the parent (cents per share) - Basic - Diluted 12 12 13.44 13.44 0.15 0.15
The accompanying accounting policies and explanatory notes form an integral part of the nancial statements.
36
C O N S O L I DAT E D S TAT E M E N T O F C O M P R E H E N S I V E I N C O M E
2010 $000
2009 $000
Prot after taxation Other comprehensive income: Translation differences relating to nancial statements of foreign subsidiaries Total comprehensive income for the year
103,715
1,223
(214) 103,501
1,151 2,374
Attributable to: Equity holders of the parent Minority interests 103,501 103,501 2,346 28 2,374
37
BALANCE SHEETS
as at 30 June 2010
Group Note 2010 $000 233 375,435 6,997 269,879 56,839 26,639 60,046 3,439 205,551 622,393 53,269 68,630 16,972 27,596 166,467 455,926 29 30 (359,663) (40) 478,888 31 32 126,460 (84) 1,793 350,715 478,884 4 478,888 2009 $000 2,899 1,415 390,985 6,827 5,958 383,656 29,677 25,797 5,669 36,887 96,626 5,748 590,018 113,514 69,138 40,464 1,441 369,988 1,731 19,755 616,031 (26,013) (726) 375,387 126,460 130 1,793 247,000 375,383 4 375,387
Company 2010 2009 $000 $000 106 50,600 1,843 1,151 3,744 25 134,865 184,799 324,584 1,233 16 133,213 134 134,596 189,988 (5,934) 236,603 126,460 1,793 108,350 236,603 236,603 106 42,501 1,907 89 4,660 33 142,153 63,957 424 211,316 1,585 83 7,568 6,000 189 15,425 195,891 240,405 126,460 1,793 112,152 240,405 240,405
Intangible assets Land use rights Fixed assets Subsidiary companies Associated companies Current assets Vessel held for sale Stocks and work-in-progress Gross amount due from customers for contract work Trade receivables Other receivables and deposits Prepayments Amounts due from subsidiary companies Fixed deposits Cash and bank balances Current liabilities Trade creditors and accruals Provision Other creditors Derivative nancial liabilities Amounts due to subsidiary companies Bank borrowings Gross amount due to customers for contract work Provision for taxation
13 14 15 16 17 15 18 19 20 21 22 24 25 25
26 27 28 23 24 29 19
Net current assets/(liabilities) Bank borrowings Deferred taxation Net assets Equity attributable to equity holders of the parent Share capital Foreign currency translation reserve Share option reserve Revenue reserve Minority interests
38
S TAT E M E N T S O F C H A N G E S I N E Q U I T Y
Attributable to equity holders of the parent Attributable to equity holders of the parent, total $000 438,504 1,195 1,151 2,346 (65,595) 128
Group
Share capital (1) $000 126,315 145
Foreign currency translation reserve (2) $000 (1,021) 1,151 1,151
Share option reserve $000 1,810 (17)
Revenue reserve $000 311,400 1,195 1,195 (65,595)
Minority interests $000 78 28 28
Equity, total $000 438,582 1,223 1,151 2,374 (65,595) 128
Balance at 1 July 2008 Prot after taxation Other comprehensive income Total comprehensive income for the year Dividends on ordinary shares (Note 33) Exercise of employee share option Cash paid to minority shareholders upon liquidation of a subsidiary company Balance at 30 June 2009
126,460
130
1,793
247,000
375,383
(102) 4
(102) 375,387
Balance at 1 July 2009 Prot after taxation Other comprehensive income Total comprehensive income for the year Balance at 30 June 2010
126,460 126,460
130 (214) (214) (84)
1,793 1,793
247,000 103,715 103,715 350,715
375,383 103,715 (214) 103,501 478,884
4 4
375,387 103,715 (214) 103,501 478,888
(1)
The holders of ordinary shares are entitled to receive dividends as and when declared by the Company. All ordinary shares carry one vote per share without restriction. The foreign currency translation reserve represents exchange differences arising from the translation of the nancial statements of foreign operations whose functional currencies are different from that of the Groups presentation currency.
(2)
39
S TAT E M E N T S O F C H A N G E S I N E Q U I T Y
Attributable to equity holders of the parent Share option reserve $000
Company
Share capital $000
Revenue Reserve $000
Total $000
Balance at 1 July 2008 Prot after taxation Other comprehensive income Total comprehensive income for the year Dividends on ordinary shares (Note 33) Exercise of employee share option Balance at 30 June 2009
126,315 145 126,460
1,810 (17) 1,793
155,637 22,110 22,110 (65,595) 112,152
283,762 22,110 22,110 (65,595) 128 240,405
Balance at 1 July 2009 Prot after taxation Other comprehensive income Total comprehensive income for the year Balance at 30 June 2010
126,460 126,460
1,793 1,793
112,152 (3,802) (3,802) 108,350
240,405 (3,802) (3,802) 236,603
40
C O N S O L I DAT E D CA S H F LOW S TAT E M E N T

2010 $000 Cash ows from operating activities Prot before taxation Adjustments for:Depreciation of xed assets Interest expenses Interest income Gain on disposal of xed assets Loss on liquidation of an associated company Impairment of goodwill Amortisation of intangible assets/land use rights Fixed assets written off Changes in fair value of derivative nancial instruments Share of prots of associated companies Provision for associated shutdown costs Impairment of trade receivables Stocks written down (Reversal of impairment losses)/impairment losses and provision for associated costs Foreign exchange (gains)/losses Impairment of land use rights Impairment of shoreline agreement Impairment of xed assets Operating cash ows before changes in working capital Increase in receivables and prepayments Decrease/(increase) in stocks and work-in-progress and gross amounts due from customers for contract work Decrease in creditors Cash generated from operations Income tax paid Net cash generated from operating activities Cash ows from investing activities Interest received Construction of xed assets Proceeds from disposal of xed assets Partial settlement of balance consideration in relation to acquisition of a subsidiary company in prior year (Note (i)) Cash distribution on liquidation of an associated company Net cash used in investing activities
2009 $000
122,351 19,055 10,746 (3,058) (30,930) 119 7 (1,527) 1,025 663 (23,425) (6,590) 1,378 2,565 9,775 102,154 (53,638) 250,923 (82,288) 217,151 (11,482) 205,669
8,138 17,038 13,575 (1,183) (64,460) 1,504 6,233 127 52 1,441 (2,123) 2,865 1,880 99,429 13,339 97,855 (12,559) (39,208) (1,345) 44,743 (18,747) 25,996
1,163 (148,466) 66,020 (273) 4 (81,552)
946 (191,457) 169,545 (1,697) 534 (22,129)
41

2010 $000 Cash ows from nancing activities Bank borrowings obtained Repayment of bank borrowings Dividends paid Cash paid to minority shareholders upon liquidation of a subsidiary company Repayments of shareholders loan Proceeds from issuance of new ordinary shares Interest paid Net cash (used in)/generated from nancing activities
2009 $000
590 (4,026) (14,023) (17,459)
307,531 (154,316) (65,595) (102) (75) 128 (9,602) 77,969
Net increase in cash and cash equivalents Cash and cash equivalents at beginning of nancial year Effects of exchange rate changes on cash and cash equivalents Cash and cash equivalents at end of nancial year (Note 25)
106,658 102,374 (42) 208,990
81,836 20,023 515 102,374
42

(i)
Acquisition of a subsidiary company, net of cash and cash equivalents acquired

In the nancial year ended 30 June 2008, the Group acquired a 100% equity interest in Nantong Dongjiang Shipyard Company Limited. The effects of acquisition of the subsidiary company are as follows: At fair values At initial accounting $000 117 353 2,123 (68) 1,355 4,627 2,572 (9,530) (647) 902 Carrying amounts in acquirees books $000 117 353 2,123 (185) 521 4,505 (9,530) (2,096)
At completion $000 Cash and cash equivalents Prepayments Other receivables Work-in-progress Land use rights Fixed assets Intangible assets Shoreline agreement Trade and other creditors Deferred tax liabilities 117 353 2,123 (68) 1,355 4,627 2,844 (9,530) (697) 1,124
Intangible assets Goodwill arising on acquisition (Note 13) Total purchase consideration Less: Balance of purchase consideration to be paid as at 30 June 2009 Cash consideration paid as of 30 June 2009 Balance of purchase consideration to be paid as at 30 June 2009 Less: Partial settlement of balance consideration of acquisition Balance of purchase consideration to be paid as at 30 June 2010 (Note 28) There was no acquisition of subsidiary companies in current nancial year.
6,233
6,455 7,357 (409) 6,948 409 (273) 136
43
N OT E S TO T H E F I N A N C I A L S TAT E M E N T S
30 June 2010
1.
CORPORATE INFORMATION Jaya Holdings Limited (the Company) is a limited liability company incorporated in the Republic of Singapore. The registered ofce of the Company is located at 13 Tuas Crescent, Singapore 638707, which is also its principal place of business. The principal activity of the Company is that of investment holding. The principal activities of the subsidiary companies are stated in Note 5. There have been no signicant changes in the nature of these activities during the nancial year. Nautical Offshore Services, a limited company incorporated in the Cayman Islands, is the immediate holding company and Nautical Offshore Holdings, a limited company incorporated in the Cayman Islands, is the intermediate holding company. Afnity Asia Pacic Fund II LP, a limited partnership, is the ultimate holding entity.
2.
SCHEMES OF ARRANGEMENT In prior year, the Company and certain subsidiary companies had met with their bank creditors to seek their support for a standstill of repayment of amounts owing to them pending a consensual restructuring of the Groups nancial arrangements. On 13 August 2009, the Company and three subsidiary companies (Jaya Shipbuilding and Engineering Pte Ltd (JSE), Java Marine Lines Pte Ltd (JML) and Airia Jaya Marine (S) Pte Ltd (AJM)) (the Applicants) have each presented a draft restructuring plan to the High Court of Singapore (the Court) and sought an initial moratorium period until 31 October 2009 to further develop the plan with a view to nalise the restructuring plan in December 2009. The applications to the Court are supported by the majority of the bank creditors. On 14 August 2009, the Court approved the applications and granted the Applicants an initial moratorium period until 31 October 2009. The initial moratorium restrains all creditors from commencing or continuing any proceedings against the Applicants during this period. The Court further granted an extension of the initial moratorium period from 31 October 2009 to 31 January 2010. The schemes of arrangement (Schemes) were subsequently approved unanimously by the schemes creditors present and voting on 28 January 2010 and sanctioned by the Court on 9 February 2010. The Schemes became effective and binding on 25 February 2010. Pursuant to the Scheme, the Groups unsecured bank borrowings have been restructured into a 5-year USD denominated secured loans with a principal holiday for the rst two years and quarterly repayment instalments over the subsequent three years. Such bank borrowings have been accordingly reclassied as non-current liabilities. As disclosed in Note 29 to the nancial statements, the approved debts are secured by various xed and oating charges over the assets of the Company, JSE, JML, AJM, JSE Shipping Pte Ltd, AJM Shipping Pte Ltd and Jaya Offshore Pte Ltd. The Group is in a net current asset position of $455,926,000 (2009: $26,013,000 net current liability position) as at 30 June 2010.
3. 3.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of preparation
The consolidated nancial statements of the Group and the balance sheet and statement of changes in equity of the Company have been prepared in accordance with Singapore Financial Reporting Standards (FRS). The nancial statements have been prepared on a historical cost basis, except as disclosed in the accounting policies below.
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30 June 2010
3. 3.1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTD)
Basis of preparation (contd)

The nancial statements are presented in Singapore Dollars (SGD or $) and all values are rounded to the nearest thousand ($000) except when otherwise indicated. The accounting policies have been consistently applied by the Group and the Company and are consistent with those used in the previous nancial year.
3.2
Changes in accounting policies

The accounting policies adopted are consistent with those of the previous nancial year except as follows: On 1 July 2009, the Group adopted the new/revised Financial Reporting Standards (FRS) and Interpretations of FRS (INT FRS) which are effective for annual nancial periods beginning on or after 1 July 2009: FRS 1 Presentation of Financial Statements (Revised) FRS 103 Business Combinations (Revised) Amendments to FRS 23 Borrowing Costs Amendments to FRS 32 Financial Instruments: Presentation and FRS 1 Presentation of Financial Statements Puttable Financial Instruments and Obligations Arising on Liquidation Amendments to FRS 101 First-time Adoption of Financial Reporting Standards and FRS 27 Consolidated and Separate Financial Statements Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate Amendments to FRS 102 Share-based Payment Vesting Conditions and Cancellations Amendments to FRS 107 Financial Instruments: Disclosures FRS 108 Operating Segments Improvements to FRSs issued in 2008 Amendments to INT FRS 109 Reassessment of Embedded Derivatives and FRS 39 Financial Instruments: Recognition and Measurement Embedded Derivatives FRS 38 Amendments to Intangible Assets FRS 39 Amendments relating to Eligible Hedged Items Amendments to INT FRS 109 Reassessment of Embedded Derivatives Amendments to INT FRS 116 Hedges of a Net Investment in a Foreign Operation INT FRS 117 Distributions of Non-cash Assets to Owners INT FRS 118 Transfers of Assets from Customers
Adoption of these standards and interpretations did not have any effect on the nancial performance or position of the Group. They did however give rise to additional disclosures, including, in some cases, revisions to accounting policies. The principal effects of these changes are as follows: FRS 1 Presentation of Financial Statements Revised Presentation The revised FRS 1 separates owner and non-owner changes in equity. The statement of changes in equity includes only details of transactions with owners, with all non-owner changes in equity presented in the statement of other comprehensive income. In addition, the Standard introduces the statement of comprehensive income which presents income and expense recognised in the period. This statement may be presented in one single statement, or two linked statements. The Group has elected to present this statement as two linked statements.
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30 June 2010
3. 3.2
Changes in accounting policies (contd)

Amendments to FRS 107 Financial Instruments: Disclosures The amendments to FRS 107 require additional disclosure about fair value measurement and liquidity risk. Fair value measurements are to be disclosed by source of inputs using a three level hierarchy for each class of nancial instrument. In addition, reconciliation between the beginning and ending balance for Level 3 fair value measurements is now required, as well as signicant transfers between Level 1 and Level 2 fair value measurements. The amendments also clarify the requirements for liquidity risk disclosures. The liquidity risk disclosures and fair value measurement disclosures are presented in Notes 39 and 41 to the nancial statements respectively. FRS 108 Operating Segments FRS 108 requires disclosure of information about the Groups operating segments and replaces the requirement to determine primary and secondary reporting segments of the Group. The Group determined that the reportable operating segments are the same as the business segments previously identied under FRS 14, Segment Reporting. Additional disclosures about each of the segments are shown in Note 38, including revised comparative information. FRS 23 Borrowing Costs FRS 23 removes the option to recognise immediately as an expense borrowing costs that are attributable to qualifying assets, i.e. assets that necessarily take a substantial period of time to get ready for their intended use or sale. Accordingly, borrowings costs on the Groups vessels under construction that meet the denition of qualifying assets will be capitalised. No adjustments will be made for borrowing costs incurred to the date of application that have been expensed. Amendment to FRS 102, Share-based Payments (Vesting Conditions and Cancellations) FRS102 has been amended to restrict the denition of vesting condition to a condition that includes an explicit or implicit requirement to provide services. Any other conditions are non-vesting conditions which have to be taken into account when estimating the fair value of the equity instrument granted. In the case that an award does not vest as a result of failure to meet a non-vesting condition that is within the control of either the entity or the counterparty, this must be accounted for as a cancellation. The change in accounting policy is to be applied retrospectively. Improvements to FRSs issued in 2008 In 2008, the Accounting Standards Council issued an omnibus of amendments to FRS. There are separate transitional provisions for each amendment. The adoption of the following amendments resulted in changes to accounting policies but did not have any impact on the nancial position or performance of the Group: FRS 16 Property, Plant and Equipment: Replaces the term net selling price with fair value less costs to sell. The Group amended its accounting policy accordingly, which did not result in any change in the nancial position. FRS 23 Borrowing Costs: The denition of borrowing costs is revised to consolidate the two types of items that are considered components of borrowing costs into one the interest expense calculated using the effective interest rate method calculated in accordance with FRS 39. The Group has amended its accounting policy accordingly which did not result in any change in its nancial position.
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30 June 2010
3. 3.3
Standards issued but not yet effective

The Group has not adopted the following standards and interpretations that have been issued but not yet effective: Effective for annual periods beginning on or after 1 January 2010 1 January 2010 1 February 2010 1 July 2010 1 July 2010
Description Amendments to FRS 101, Additional Exemptions for First-time Adopters Amendments to FRS 102, Group Cash-settled Share-based Payment Transactions Amendments to FRS 32, Classication of Rights Issues INT FRS 119, Extinguishing Financial Liabilities with Equity Instruments Amendments to FRS 101, Limited Exemptions from Comparative FRS 107 Disclosures for First Time Adopters Amendments to INT FRS 114, Prepayments of a Minimum Funding Requirement FRS 24 (Revised), Related Party Disclosures INT FRS 115 Agreements for the Construction of Real Estate Improvements to FRSs issued in 2009: Amendments to FRS 1, Presentation of Financial Statements Amendments to FRS 7, Statement of Cash Flows Amendments to FRS 17, Leases Amendments to FRS 36, Impairment of Assets Amendments to FRS 39, Financial Instruments: Recognition and Measurement Amendments to FRS 105, Non-current Assets Held for Sale and Discontinued Operations Amendments to FRS 108, Operating Segments
1 January 2011 1 January 2011 1 January 2011
1 January 2010 1 January 2010 1 January 2010 1 January 2010 1 January 2010 1 January 2010 1 January 2010
The directors expect that the adoption of the above standards and interpretations will have no material impact on the nancial statements in the period of initial application, except for FRS 24 as indicated below. FRS 24 Related Party Disclosures (Revised) The revised FRS 24 expands the denition of a related party and would treat two entities as related to each other whenever a person (or a close member of that persons family) or a third party entity has control or joint control over the entity, or has signicant inuence over the entity. The Group is currently determining the impact of the expanded denition has on the disclosure of related party transactions. As this is a disclosure standard, it will have no impact on the nancial position or nancial performance of the Group when implemented in 2011.
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30 June 2010
3. 3.4
Basis of consolidation
The consolidated nancial statements comprise the nancial statements of the Company and its subsidiary companies as at the balance sheet date. The nancial statements of the subsidiary companies used in the preparation of the consolidated nancial statements are prepared for the same reporting date as the Company. Consistent accounting policies are applied to like transactions and events in similar circumstances. All intra-group balances, income and expenses and unrealised gains and losses resulting from intra-group transactions are eliminated in full. Acquisitions of subsidiary companies are accounted for by applying the purchase method. Identiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. Adjustments to those fair values relating to previously held interests are treated as a revaluation and recognised in equity. Any excess of the cost of business combination over the Groups share in the net fair value of the acquired subsidiary companys identiable assets, liabilities and contingent liabilities is recorded as goodwill on the balance sheet. The accounting policy for goodwill is set out in Note 3.8(a). Any excess of the Groups share in the net fair value of the acquired subsidiary companys identiable assets, liabilities and contingent liabilities over the cost of business combination is recognised as income in prot or loss on the date of acquisition. Subsidiary companies are consolidated from the date of acquisition, being the date on which the Group obtains control, and continue to be consolidated until the date that such control ceases.
3.5
Transactions with minority interests

Minority interests represent the portion of prot or loss and net assets in subsidiary companies not held by the Group and are presented separately in prot or loss of the Group and within equity in the consolidated balance sheet, separately from parent shareholders equity. Transactions with minority interests are accounted for using the entity concept method, whereby, transactions with minority interests are accounted for as transactions with equity holders. On acquisition of minority interests, the difference between the consideration and book value of the share of the net assets acquired is reected as being a transaction between owners and recognised directly in equity. Gain or loss on disposal to minority interests is recognised directly in equity.
3.6
Subsidiary companies
A subsidiary company is an entity over which the Group has the power to govern the nancial and operating policies so as to obtain benets from its activities. Investments in subsidiary companies are stated in the nancial statements of the Company at cost less impairment losses.
3.7
Associated companies
An associated company is an entity, not being a subsidiary company or a joint venture, in which the Group has signicant inuence. The Groups investments in associated companies are accounted for under the equity method. Under the equity method, the investment in associated company is measured in the balance sheet at cost plus post-acquisition changes in the Groups share of net assets of the associated companies.
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30 June 2010
3. 3.7
Associated companies (contd)

Goodwill relating to an associated company is included in the carrying amount of the investment. Any excess of the Groups share of the net fair value of the associated companys identiable assets, liabilities and contingent liabilities over the cost of the investment is deducted from the carrying amount of the investment and is recognised as income as part of the Groups share of results of the associated company in the period in which the investment is acquired. When the Groups share of losses in an associated company equals or exceeds its interest in the associated company, including any other unsecured receivables, the Group does not recognise further losses, unless it has incurred obligations or made payments on behalf of the associated company. The most recent available audited nancial statements of the associated companies are used by the Group in applying the equity method. Where the dates of the audited nancial statements used are not co-terminous with those of the Group, the share of results is arrived at from the last audited nancial statements available and un-audited management nancial statements to the end of the accounting period. Consistent accounting policies are applied for like transactions and events in similar circumstances. In the Companys separate nancial statements, investments in associated companies are accounted for at cost less impairment losses.
3.8
Intangible assets
(a)
Goodwill
Goodwill is initially measured at cost. Following initial recognition, goodwill is measured at cost less accumulated impairment losses. Goodwill is reviewed for impairment annually or more frequently if events and circumstances indicate that the carrying value may be impaired. For the purpose of impairment testing, goodwill acquired is allocated to each of the Groups cash-generating units that are expected to benet from the synergies of the combination. The cash-generating unit to which goodwill has been allocated is tested for impairment annually and whenever there is an indication that the cash-generating unit may be impaired, by comparing the carrying amount of the cash-generating unit, including the allocated goodwill, with the recoverable amount of the cash-generating unit. Where the recoverable amount of the cash-generating unit is less than the carrying amount, an impairment loss is recognised in the prot or loss. Impairment losses recognised for goodwill are not reversed in subsequent periods. Where goodwill forms part of a cash-generating unit and part of the operation within that cash-generating unit is disposed of, the goodwill associated with the operation disposed of is included in the carrying amount of the operation when determining the gain or loss on disposal of the operation. Goodwill disposed of in this circumstance is measured based on the relative fair values of the operations disposed of and the portion of the cash-generating unit retained.
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30 June 2010
3. 3.8
Intangible assets (contd)

(a)
Goodwill (contd)
Goodwill and fair value adjustments arising on the acquisition of foreign operations on or after 1 January 2005 are treated as assets and liabilities of the foreign operations and are recorded in the functional currency of the foreign operations and translated in accordance with the accounting policy set out in Note 3.17. Goodwill and fair value adjustments which arose on acquisitions of foreign operations before 1 January 2005 are deemed to be assets and liabilities of the Company and are recorded in SGD at the rates prevailing at the date of acquisition.
(b)
Other intangible assets

Intangible assets acquired separately are measured initially at cost. The cost of intangible assets acquired in a business combination is their fair value as at the date of acquisition. Following initial acquisition, intangible assets are measured at cost less any accumulated amortisation and accumulated impairment losses. Intangible assets with nite useful lives are amortised over the estimated useful lives and assessed for impairment whenever there is an indication that the intangible asset may be impaired. The amortisation period and the amortisation method are reviewed at least at each nancial year-end. Intangible assets with indenite useful lives or not yet available for use are tested for impairment annually or more frequently if the events and circumstances indicate that the carrying value may be impaired either individually or at the cash-generating unit level. Such intangible assets are not amortised. The useful life of an intangible asset with an indenite useful life is reviewed annually to determine whether the useful life assessment continues to be supportable. If not, the change in useful life from indenite to nite is made on a prospective basis.
Shoreline agreement
The shoreline agreement was acquired as part of a business combination. The agreement grants the Group the right to use the shoreline at a favourable rate as compared to the market rental rate for locations in the vicinity. It is amortised on a straight line basis over its nite useful life, which is determined based on the remaining period of 26 years (2009: 27 years) from date of acquisition. 3.9
Land use rights

Land use rights are initially measured at cost. Following initial recognition, land use rights are measured at cost less accumulated amortisation and accumulated impairment losses. The land use rights are amortised over the remaining lease term of 46 years (2009: 47 years) from date of acquisition.
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30 June 2010
3.
3.10 Revenue recognition Revenue is recognised to the extent that it is probable that the economic benets will ow to the Group and the revenue can be reliably measured. Revenue is measured at the fair value of consideration received or receivable. (a)
Ship repair and shipbuilding

Revenue from ship repair and shipbuilding contracts is recognised using the percentage of completion basis. The percentage of completion for a given contract is determined after considering the relationship of the value of work done to-date to total contracted revenue as explained in Note 3.23 below.
(b)
Ship chartering
Revenue from ship chartering activities is recognised in the prot or loss over the duration of the contracts.
(c)
Vessel sale/disposal of xed assets

Revenue from vessel sale arises when a vessel which is recorded as a xed asset by the Group for its chartering business is sold within one year of commissioning. Both revenue from vessel sale and gain on disposal of xed assets are recognised upon the transfer of signicant risk and rewards of ownership of the vessels to the customer, which generally coincides with delivery and acceptance of the vessels sold. Revenue is not recognised to the extent where there are signicant uncertainties regarding recovery of the consideration due, associated costs or the possible return of vessels.
(d)
Dividend income
Dividend income is recognised when the shareholders rights to receive the payment are established.
(e)
Interest income
Interest income is recognised using the effective interest method.
3.11 Employee benets (a)
Dened contribution plans

The Group participates in national pension schemes as dened by the laws of the countries in which it has operations. As required by law, the Groups companies in Singapore make contributions to the state pension scheme, the Central Provident Fund (CPF), a dened contribution pension scheme. Contributions to dened contribution pension schemes are recognised as compensation expense in the same period as the employment that gives rise to the contribution.
(b)
Employee leave entitlements

Employee entitlements to annual leave are recognised as a liability when they accrue to the employees. An accrual is made for the estimated liability for annual leave as a result of services rendered by employees up to the balance sheet date.
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30 June 2010
3.
3.11 Employee benets (contd) (c)
Equity-related compensation benets

Pursuant to the Jaya Employees Share Option Scheme, certain employees and directors receive remuneration in the form of share-based payment transactions, whereby employees and directors render services as consideration for share options (equity-settled transactions). The cost of equity-settled transactions with employees is measured by reference to the fair value at the date on which the share options are granted. In valuing the share options, no account is taken of any performance conditions, other than conditions linked to the price of the shares of the Company (market conditions), if applicable. The cost of equity-settled transactions is recognised, together with a corresponding increase in the employee share option reserve (known as share option reserve in these nancial statements), over the period in which the performance and/or service conditions are fullled, ending on the date on which the relevant employees become fully entitled to the award (the vesting date). The cumulative expense recognised for equity-settled transactions at each reporting date until the vesting date reects the extent to which the vesting period has expired and the Groups best estimate of the number of equity instruments that will ultimately vest. The prot or loss charge or credit for a period represents the movement in cumulative expense recognised as at the beginning and end of that period. No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition, which are treated as vested irrespective of whether or not the market condition is satised, provided that all other performance conditions are satised. Where the terms of an equity-settled award are modied, as a minimum an expense is recognised as if the terms had not been modied. In addition, an expense is recognised for any modication, which increases the total fair value of the share-based payment arrangement, or is otherwise benecial to the employee as measured at the date of modication. Where an equity-settled award is cancelled, it is treated as if it had vested on the date of cancellation, and any expense not yet recognised for the award is recognised immediately. However, if a new award is substituted for the cancelled award, and designated as a replacement award on the date that it is granted, the cancelled and new awards are treated as if they were a modication of the original award, as described in the previous paragraph. The Group has taken advantage of the transitional provisions of FRS 102 in respect of equity-settled awards and has applied FRS 102 only to equity-settled awards granted after 22 November 2002 that had not vested on or before 1 January 2005.
52
30 June 2010
3.
3.12 Fixed assets All items of xed assets are initially recorded at cost. The cost of an item of xed assets is recognised as an asset if, and only if, it is probable that future economic benets associated with the item will ow to the Group and the cost of the item can be measured reliably. Subsequent to recognition, xed assets are measured at cost less accumulated depreciation and accumulated impairment losses. Depreciation is computed on a straight-line basis over their estimated useful lives of the assets as follows:Vessels Leasehold land and buildings Cranes and motor vehicles Other assets 12 to 15 years Over the remaining life of the lease of 1 to 18 years (2009: 2 to 19 years) 5 to 10 years 4 to 20 years
Construction-in-progress included in the xed assets relates mainly to vessels under construction. They are stated at cost and are not depreciated as these assets are not yet available for use. The carrying values of xed assets are reviewed for impairment when events or changes in circumstances indicate that the carrying value may not be recoverable. The residual values, useful lives and depreciation method are reviewed at each nancial year-end to ensure that the amount, method and period of depreciation are consistent with previous estimates and expected pattern of consumption of the future economic benets embodied in the items of xed assets. An item of xed assets is derecognised upon disposal or when no future economic benets are expected from its use or disposal. Any gain or loss on derecognition of the asset is included in the prot or loss in the year the asset is derecognised. 3.13 Stocks and work-in-progress Stocks consist mainly of steel, consumables and other materials used for shipbuilding, repair and conversion and are stated at the lower of cost and net realisable value. Cost is primarily determined on a rst-in-rst-out basis and includes all cost in bringing the stocks to their present location and condition. Net realisable value is the estimated selling price in the ordinary course of business less estimated costs of completion and the estimated costs necessary to make the sale, and after making due allowance for all damaged, obsolete and slow-moving items. Work-in-progress comprises uncompleted shipbuilding, repair and fabrication contracts. It is stated at the lower of cost and net realisable value. Cost is made up of material, direct labour, subcontractors costs, appropriate allocation of xed and variable production overheads and other directly related expenses. Provision is made for anticipated losses, if any, on work-inprogress when the possibility of loss is ascertained.
53
30 June 2010
3.
3.14 Cash and cash equivalents Cash and cash equivalents comprise cash on hand and at banks including xed deposits and short-term, highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignicant risk of changes in value. Cash and short term deposits carried in the balance sheets are classied and accounted for as loans and receivables. The accounting policy for this category of nancial assets is stated in Note 3.20. 3.15 Provisions Provisions are recognised when the Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outow of economic resources will be required to settle the obligation and the amount of the obligation can be estimated reliably. Provisions are reviewed at each balance sheet date and adjusted to reect the current best estimate. If it is no longer probable that an outow of economic resources will be required to settle the obligation, the provision is reversed. If the effect of the time value of money is material, provisions are discounted using a current pre-tax rate that reects, where appropriate, the risks specic to the liability. When discounting is used, the increase in the provision due to the passage of time is recognised as a nance cost. 3.16 Income taxes (a)
Current tax
Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the balance sheet date. Current taxes are recognised in the prot or loss except to the extent that the tax relates to items recognised outside prot or loss, either in other comprehensive income or directly in equity.
(b)
Deferred tax
Deferred income tax is provided using the liability method on temporary differences at the balance sheet date between the tax bases of assets and liabilities and their carrying amounts for nancial reporting purposes. Deferred tax liabilities are recognised for all temporary differences, except: Where the deferred income tax liability arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction affects neither the accounting prot nor taxable prot or loss; and In respect of taxable temporary differences associated with investments in subsidiary companies, associated companies and interests in joint ventures, where the timing of the reversal of the temporary differences can be controlled by the Group and it is probable that the temporary differences will not reverse in the foreseeable future.
54
30 June 2010
3.
3.16 Income taxes (contd) (b)
Deferred tax (contd)

Deferred income tax assets are recognised for all deductible temporary differences, carry forward of unused tax credits and unused tax losses, to the extent that it is probable that taxable prot will be available against which the deductible temporary differences, and the carry forward of unused tax credits and unused tax losses can be utilised except: where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting prot nor taxable prot or loss; and in respect of deductible temporary differences associated with investments in subsidiary companies, associated companies and interests in joint ventures, deferred income tax assets are recognised only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable prot will be available against which the temporary differences can be utilised.
The carrying amount of deferred tax asset is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufcient taxable prot will be available to allow all or part of the deferred tax asset to be utilised. Unrecognised deferred tax assets are reassessed at each balance sheet date and are recognised to the extent that it has become probable that future taxable prot will allow the deferred tax asset to be utilised. Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates and tax laws that have been enacted or substantively enacted at the balance sheet date. Deferred income tax relating to items recognised outside prot or loss is recognised outside prot or loss. Deferred tax items are recognised in correlation to the underlying transaction either in other comprehensive income or directly in equity and deferred tax arising from a business combination is adjusted against goodwill on acquisition. Deferred income tax assets and deferred income tax liabilities are offset, if a legally enforceable right exists to set off current tax assets against current income tax liabilities and the deferred income taxes relate to the same taxable entity and the same taxation authority. (c)
Sales tax
Revenues, expenses and assets are recognised net of the amount of sales tax except: Where the sales tax incurred on a purchase of assets or services is not recoverable from the taxation authority, in which case the sales tax is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable; and Receivables and payables that are stated with the amount of sales tax included.
The net amount of sales tax recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet.
55
30 June 2010
3.
3.17 Foreign currency Items included in the nancial statements of each entity in the Group are measured using the currency that best reects the economic substance of the underlying events and circumstances relevant to that entity (the functional currency). The consolidated nancial statements and balance sheet of the Company are presented in Singapore Dollars, which is the functional currency of the Company. Transactions in foreign currencies are measured in Singapore Dollars and are recorded at exchange rates approximating those ruling at the transaction dates. Foreign currency monetary assets and liabilities are translated using the exchange rates ruling at balance sheet date. Non-monetary assets and liabilities are translated using the exchange rates ruling at the transaction dates or, in the case of items carried at fair value, the exchange rates that existed when the values were determined. All resultant exchange differences are recognised in the prot or loss except for exchange differences arising on monetary items that form part of the Groups net investment in foreign subsidiary companies, which are recognised initially in equity as foreign currency translation reserve in the consolidated balance sheet and recognised in the consolidated prot or loss on disposal of the subsidiary company. Assets and liabilities of foreign operations are translated into Singapore Dollars at exchange rates ruling at balance sheet date. Revenue and expenses are translated at weighted average exchange rates for the year. All resultant exchange differences are taken directly to foreign currency translation reserve. On disposal of a foreign operation, accumulated exchange differences are recognised in the prot or loss as a component of the gain or loss on disposal. 3.18 Borrowing costs Borrowing costs are capitalised as part of the cost of a qualifying asset if they are directly attributable to the acquisition, construction or production of that asset. Capitalisation of borrowing costs commences when the activities to prepare the asset for its intended use or sale are in progress and the expenditures and borrowing costs are incurred. Borrowing costs are capitalised until the assets are ready for their intended use or sale. 3.19 Leases The determination of whether an arrangement is, or contains a lease is based on the substance of the arrangement at inception date: whether fullment of the arrangement is dependent on the use of a specic asset or assets or the arrangement conveys a right to use the asset. For arrangements entered into prior to 1 January 2005, the date of inception is deemed to be 1 January 2005 in accordance with the transitional requirements of INT FRS 104. (a)
Operating lease when the Group is a lessee

Leases where the lessor effectively retains substantially all the risks and rewards of ownership of the leased item are classied as operating leases. Operating lease payments are recognised as an expense in the prot or loss on a straightline basis over the lease term. The aggregate benet of incentives provided by the lessor is recognised as a reduction of rental expense over the lease term on a straight-line basis.
56
30 June 2010
3.
3.19 Leases (contd) (b)
Operating lease when the Group is a lessor

Leases where the Group retains substantially all the risks and rewards of ownership of the asset are classied as operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same bases as rental income. The accounting policy for ship chartering is set out in Note 3.10(b). Assets leased out under operating leases are included in xed assets and are stated at cost less accumulated depreciation and accumulated impairment loss.
3.20 Financial assets Financial assets are recognised on the balance sheet when, and only when, the Group becomes a party to the contractual provisions of the nancial instrument. When nancial assets are recognised initially, they are measured at fair value, plus, in the case of nancial assets not at fair value through prot or loss, directly attributable transaction costs. A nancial asset is derecognised where the contractual right to receive cash ows from the asset has expired. On derecognition of a nancial asset in its entirety, the difference between the carrying amount and the sum of the consideration received and any cumulative gain or loss that has been recognised in other comprehensive income is recognised in the prot or loss.
Loans and receivables

Financial assets with xed or determinable payments that are not quoted in an active market are classied as loans and receivables. Subsequent to initial recognition, loans and receivables are measured at amortised cost using the effective interest method. Gains and losses are recognised in the prot or loss when the loans and receivables are derecognised or impaired, and through the amortisation process. 3.21 Financial liabilities Financial liabilities are recognised on the balance sheet when, and only when, the Group becomes a party to the contractual provisions of the nancial instrument. Financial liabilities are recognised initially at fair value, plus, in the case of nancial liabilities other than derivatives, directly attributable transaction costs. Subsequent to initial recognition, all nancial liabilities are measured at amortised cost using the effective interest method, except for derivatives, which are measured at fair value. For nancial liabilities other than derivatives, gains and losses are recognised in prot or loss when the liabilities are derecognised, and through the amortisation process. Any gains or losses arising from changes in fair value of derivatives are recognised in prot or loss. Net gains or losses on derivatives include exchange differences.
57
30 June 2010
3.
3.21 Financial liabilities (contd) A nancial liability is derecognised when the obligation under the liability is extinguished. When an existing nancial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modied, such an exchange or modication is treated as a derecognition of the original liability and the recognition of a new liability, and the difference in the respective carrying amounts is recognised in the prot or loss. 3.22 Impairment (a)
Impairment of nancial assets

The Group assesses at each balance sheet date whether there is any objective evidence that a nancial asset or group of nancial assets is impaired. (i)
Assets carried at amortised cost

If there is objective evidence that an impairment loss on loans and receivables carried at amortised cost has been incurred, the amount of the loss is measured as the difference between the assets carrying amount and the present value of estimated future cash ows (excluding future credit losses that have not been incurred) discounted at the nancial assets original effective interest rate (i.e. the effective interest rate computed at initial recognition). The carrying amount of the asset is reduced through the use of an allowance account. The amount of the loss is recognised in the prot or loss. When the asset becomes uncollectible, the carrying amount of impaired nancial assets is reduced directly or if an amount was charged to the allowance account, the amounts charged to the allowance account are written off against the carrying value of the nancial asset. To determine whether there is objective evidence that an impairment loss on nancial assets has been incurred, the Group considers factors such as the probability of insolvency or signicant nancial difculties of the debtor and default or signicant delay in payments. If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after the impairment was recognised, the previously recognised impairment loss is reversed, to the extent that the carrying amount of the asset does not exceed its amortised cost at the reversal date. The amount of reversal is recognised in prot or loss.
58
30 June 2010
3.
3.22 Impairment (contd) (a)
Impairment of nancial assets (contd)

(ii)
Assets carried at cost

If there is objective evidence that an impairment loss on an unquoted equity instrument that is not carried at fair value because its fair value cannot be reliably measured, or on a derivative asset that is linked to and must be settled by delivery of such an unquoted equity instrument has been incurred, the amount of the loss is measured as the difference between the assets carrying amount and the present value of estimated future cash ows discounted at the current market rate of return for a similar nancial asset. Such impairment losses are not reversed in subsequent periods.
(b)
Impairment of non-nancial assets

The Group assesses at each reporting date whether there is an indication that an asset may be impaired. If any such indication exists, or when annual impairment testing for an asset (i.e. an intangible asset with an indenite useful life, an intangible asset not yet available for use, or goodwill acquired in a business combination) is required, the Group makes an estimate of the assets recoverable amount. An assets recoverable amount is the higher of an assets or cash-generating units fair value less costs to sell and its value in use and is determined for an individual asset, unless the asset does not generate cash inows that are largely independent of those from other assets or groups of assets. In assessing value in use, the estimated future cash ows are discounted to their present value using a pre-tax discount rate that reects current market assessments of the time value of money and the risks specic to the asset. Where the carrying amount of an asset exceeds its recoverable amount, the asset is considered impaired and is written down to its recoverable amount. Impairment losses are recognised in the prot or loss except for assets that are previously revalued where the revaluation was taken to other comprehensive income. In this case the impairment is also recognised in other comprehensive income up to the amount of any previous revaluation. An assessment is made at each reporting date as to whether there is any indication that previously recognised impairment losses may no longer exist or may have decreased. A previously recognised impairment loss is reversed only if there has been a change in the estimates used to determine the assets recoverable amount since the last impairment loss was recognised. If that is the case, the carrying amount of the asset is increased to its recoverable amount. That increase cannot exceed the carrying amount that would have been determined, net of depreciation, had no impairment loss been recognised previously. Such reversal is recognised in the prot or loss unless the asset is measured at revalued amount, in which case the reversal is treated as a revaluation increase.
3.23 Construction contracts Contract revenue and contract costs are recognised as revenue and expenses respectively by reference to the stage of completion of the contract activity at the balance sheet date, when the outcome of a construction contract can be estimated reliably. An expected loss on the construction contract is recognised as an expense immediately when it is probable that total contract costs will exceed total contract revenue. Revenue arising from xed price contracts is recognised in accordance with the percentage of completion method. The stage of completion is measured by reference to surveys of work performed. Where the contract outcome cannot be measured reliably, revenue is recognised only to the extent of the expenses recognised that are recoverable.
59
30 June 2010
3.
3.24 Segment reporting For management purposes, the Group is organised into operating segments based on their products and services which are independently managed by the respective segment managers responsible for the performance of the respective segments under their charge. The segment managers report directly to the management of the Company who regularly review the segment results in order to allocate resources to the segments and to assess the segment performance. Additional disclosures on each of these segments are shown in Note 38, including the factors used to identify the reportable segments and the measurement basis of segment information. 3.25 Government grants Government grant shall be recognised in prot or loss on a systematic basis over the periods in which the entity recognises as expenses the related costs for which the grants are intended to compensate. Grants related to income are deducted in reporting the related expenses.
4.
SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES The preparation of the Groups nancial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenue, expenses, assets and liabilities, and the disclosure of contingent liabilities at the reporting date. However, uncertainty about these assumptions and estimates could result in outcomes that could require a material adjustment to the carrying amount of the asset or liability affected in the future.
4.1
Judgements made in applying accounting policies

The following judgement is made by management in the process of applying the Groups accounting policies that have the most signicant effect on the amounts recognised in the nancial statements:(a)
Income taxes
The Group has exposure to income taxes in numerous jurisdictions. Signicant judgement is involved in determining the group-wide provision for income taxes. There are certain transactions and computations for which the ultimate tax determination is uncertain during the ordinary course of business. The Group recognises liabilities for expected tax issues based on estimates of whether additional taxes will be due. Where the nal tax outcome of these matters is different from the amounts that were initially recognised, such differences will impact the income tax and deferred tax provisions in the period in which such determination is made. The carrying amount of the Groups tax payables and deferred tax liabilities as at 30 June 2010 was $27,596,000 (2009: $19,755,000) and $40,000 (2009: $726,000) respectively.
(b)
Operating lease commitments As lessor

The Group has entered into charter party agreements on its eet of vessels. The Group has determined, based on an evaluation of the terms and conditions of the arrangements, that it retains all the signicant risks and rewards of ownership of these vessels and have accounted for these as operating leases.
60
30 June 2010
4. 4.1
SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES (CONTD)
Judgements made in applying accounting policies (contd)

(c)
Determination of functional currency

The Group measures foreign currency transactions in the respective functional currencies of the Company and its subsidiaries. In determining the functional currencies of the entities in the Group, judgement is required to determine the currency that mainly inuences sales prices for goods and services and of the country whose competitive forces and regulations mainly determines the sales prices of its goods and services. The functional currencies of the entities in the Group are determined based on managements assessment of the economic environment in which the entities operate and the entities process of determining sales prices.
4.2
Key sources of estimation uncertainty

The key assumptions concerning the future and other key sources of estimation uncertainty at the balance sheet date, that have a signicant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next nancial year, are discussed below:(a)
Depreciation of xed assets Vessels

Vessels are depreciated on a straight-line basis over their estimated useful lives so as to write-down the cost to the estimated residual values at the end of their useful lives. These estimates regarding the useful lives (12 to 15 years) and residual values of the vessels are made by the Company based on past experience and industry trends. The useful lives and residual values are reviewed on an annual basis. The carrying amount of the Groups vessels as at 30 June 2010 approximated $273,364,000 (2009: $230,460,000).
(b)
Impairment of non-nancial assets

The Group assesses whether there are any indicators of impairment for all non-nancial assets at each reporting date. Goodwill and other indenite life intangibles are tested for impairment annually and at other times when such indicators exist. Other non-nancial assets are tested for impairment when there are indicators that the carrying amounts may not be recoverable. When value in use calculations are undertaken, management must estimate the expected future cash ows from the asset or cash-generating unit and choose a suitable discount rate in order to calculate the present value of those cash ows. Further details of the impairment assessment of goodwill are given in Note 13 to the nancial statements.
(c)
Impairment of loans and receivables

The Group assesses at each balance sheet date whether there is any objective evidence that a nancial asset is impaired. To determine whether there is objective evidence of impairment, the Group considers factors such as the probability of insolvency or signicant nancial difculties of the debtor and default or signicant delay in payments. Where there is objective evidence of impairment, the amount and timing of future cash ows are estimated based on historical loss experience for assets with similar credit risk characteristics. The carrying amount of the Groups loans and receivables at the balance sheet date is disclosed in Note 20 to the nancial statements.
61
30 June 2010
4. 4.2
SIGNIFICANT ACCOUNTING JUDGEMENTS AND ESTIMATES (CONTD)
Key sources of estimation uncertainty (contd)

(d)
Construction contracts
The Group recognises contract revenue by reference to the stage of completion of the contract activity at the balance sheet date, when the outcome of a construction contract can be estimated reliably. The stage of completion is measured by reference to the proportion that contract costs incurred for work performed to date bear to the estimated total contract costs. Signicant assumptions are required to estimate the total contract costs and the recoverable variation works that will affect the stage of completion. The estimates are made based on past experience and knowledge of the project engineers. The carrying amounts of assets and liabilities arising from construction contracts at the balance sheet date are disclosed in Note 19 to the nancial statements.
(e)
Provision for associated costs for cancellation and deferment of committed purchase orders and impairment losses for vessel projects
The Group moderated its pace of vessel construction in line with the current market demand. In the process, the Group identied certain vessel projects for cancellation and deferment and started negotiation with key suppliers on the cancellation and deferment of committed purchase orders. Management estimated the expected future cash outows with regards to the cancellation and deferment of committed purchase orders and has made the related provision for the nancial year ended 30 June 2010. In addition, the Group assessed the prepayments and accumulated costs of work-in-progress relating to the committed purchase orders for projects identied to be cancelled. The recoverable amount of related prepayments and accumulated costs of work-inprogress is estimated at each reporting date when there are indications of impairment. Impairment loss is recognised when the carrying amount of related prepayments and accumulated costs of work-in-progress is higher than its recoverable amount. The provision for associated costs and impairment losses recognised for the nancial year ended 30 June 2010 are disclosed in Notes 8, 18, 22 and 27 to the nancial statements.
62
30 June 2010
5.
SUBSIDIARY AND ASSOCIATED COMPANIES The subsidiary and associated companies as at 30 June 2010 and 2009 are as follows:Percentage of equity held by the Group 2010 2009 % %
Name of company (Country of incorporation)
Principal activities
Cost of investment 2010 2009 $000 $000
Subsidiary companies of Jaya Holdings Limited Jaya Offshore Pte Ltd (1) (Singapore) Java Marine Lines Pte Ltd (1) (Singapore) Jaya Shipbuilding and Engineering Pte Ltd (1) (Singapore) Jaya Offshore (H. K.) Limited(2) (Hong Kong) Xinet Pte Ltd (Singapore) Jaya Century Pte Ltd (Singapore) Crescent Shipping Pte Ltd (Singapore) Jaya Logistics Pte Ltd (Singapore) Jaya Shipmanagement Pte Ltd (Singapore) Verbena Pte Ltd (Singapore) Unquoted shares, at cost (Note 16) Ship chartering and shipmanagement 200 200 100 100
Shipowning, ship chartering, shipbuilding and vessel sale Ownership of shipyard and the building and repairing of ships
26,905
26,905
100
100
3,637
3,637
100
100
Investment holding
44
44
100
100
Dormant
500
500
100
100
Dormant
2,679
2,679
100
100
Dormant
100
100
100
100
Dormant
90
90
100
100
Dormant
70
70
70
70
Dormant
449 34,674
449 34,674
100
100
63
30 June 2010
5.
SUBSIDIARY AND ASSOCIATED COMPANIES (CONTD) Percentage of equity held by the Group 2010 2009 % %
Subsidiary companies of Jaya Offshore Pte Ltd

Airia Jaya Marine (S) Pte Ltd (1) (Singapore) Jaya International Transport Pte Ltd (1) (Singapore) P.T. Jaya Asiatic Shipyard (3) (Indonesia) Shipowning, ship chartering, shipmanagement and shipbuilding Shipowning and ship chartering 100 100
100
100
Ownership of shipyard and the building and repairing of ships
100#
100#
Subsidiary company of Jaya Shipmanagement Pte Ltd

Jaya Pacic Line Pte Ltd (4) (Singapore) Dormant 49 49
Subsidiary company of Jaya Offshore (H.K.) Limited

Nantong Dongjiang Shipyard Company Limited (5) (Peoples Republic of China) Ownership of shipyard and the building and repairing of ships 100 100
Subsidiary company of Airia Jaya Marine (S) Pte Ltd

AJM Shipping Pte Ltd (1) (Singapore) Shipowning, ship chartering and shipmanagement 100
Subsidiary company of Jaya Shipbuilding and Engineering Pte Ltd

JSE Shipping Pte Ltd (1) (Singapore) Shipowning, ship chartering and shipmanagement 100
64
30 June 2010
5.
SUBSIDIARY AND ASSOCIATED COMPANIES (CONTD) Percentage of equity held by the Group 2010 2009 % %
Cost of investment 2010 2009 $000 $000
Associated companies of Jaya Holdings Limited

Jaya DMS Marine Pte Ltd (1) (Singapore) DMS Jaya Marine W.L.L. (6) (Qatar) Asia Power Systems Corporation (British Virgin Islands) Unquoted shares, at cost (Note 17) Shipowning and ship chartering 124 124 50 50
Ship chartering
46
46
49
49
Dormant
50
50
170
170
Associated company of Jaya Offshore Pte Ltd

Sanergy Jaya Marine Pte Ltd (8) (Singapore) Shipowning, ship chartering and shipmanagement 50
Associated company of Java Marine Lines Pte Ltd

Batamindo Carriers Pte Ltd (7) (Singapore)
(1) (2) (3) (4) (5) (6) (7) (8)
Ship and boat chartering services
35
35
@ #
Audited by Ernst & Young LLP, Singapore. Audited by Paul W.C. Ho & Company, Certied Public Accountants, Hong Kong. Audited by Drs. Sukimto Sjamsuli Publik Accountant, Batam, Indonesia. Deemed to be a subsidiary company as the Group controls the composition of the Board of Directors of the entity. Audited by Nantong Sanjiaozhou Certied Public Accountants, Peoples Republic of China. Audited by a member rm of Ernst and Young Global. Audited by KPMG LLP, Singapore. The Company has been liquidated during the year. Cost of investment is less than $1,000. Jaya Offshore Pte Ltd and Java Marine Lines Pte Ltd each has an equity interest of 95% and 5% respectively in P.T. Jaya Asiatic Shipyard.
65
30 June 2010
6.
REVENUE Group 2010 $000 Charter income Shipbuilding and ship repair income/vessel sale Total revenue 64,109 292,954 357,063 2009 $000 90,657 172,514 263,171
7.
OTHER INCOME Group 2010 $000 Interest income on loans and receivables: Fixed deposits Bank deposits Amount due from associated company Trade debtors Gain on disposal of xed assets Sundry income Foreign exchange gains arising from translation of monetary assets and liabilities 2009 $000
8 378 225 2,447 30,930 784 2,451 37,223
892 59 232 64,460 1,924 67,567
66
30 June 2010
8.
OTHER EXPENSES Group 2010 $000 Reversal of impairment losses/impairment losses and provision for associated costs for cancellation and deferment of vessel projects: Reversal of impairment of/(impairment of) work-in-progress (Note 18) Cancellation costs of prepayments Reversal of impairment of/(impairment of) prepayments (Note 22) Cancellation costs of work-in-progress Cancellation costs of equipment Reversal of/(provision for) associated costs (Note 27) Provision for associated shut down costs (Note 27) Impairment of land use rights (Note 14) Impairment of shoreline agreement (Note 13) Impairment of xed assets (Note 15) Changes in fair value of derivative nancial instruments Restructuring costs Realised losses arising from foreign exchange forward contracts Foreign exchange losses arising from translation of monetary assets and liabilities Impairment of goodwill Stocks written down Loss on liquidation of an associated company Others 3,198 (1,413) 20,226 (6) (113) 1,533 23,425 (1,025) (1,378) (2,565) (9,775) (28,278) (119) (19,715) (8,227) (22,064) (69,138) (99,429) (1,441) (55,446) (14,099) (6,233) (1,880) (1,504) (126) (180,158) 2009 $000
9.
INTEREST EXPENSES Group 2010 $000 Interest expense on bank borrowings Less : Capitalised in work-in-progress (10,746) 1,778 (8,968) 2009 $000 (13,575) 3,849 (9,726)
67
30 June 2010
10.
PROFIT BEFORE TAXATION The following items have been included in arriving at prot before taxation:Group 2010 $000 Wages, salaries, bonuses and other staff related expenses Jobs credit scheme grant Employers contribution to dened contribution plans Non-audit fees paid to auditors of the Company Impairment of trade receivables Amortisation of intangible assets/land use rights Fixed assets written off Depreciation of xed assets Legal and professional fees (24,723) 312 (1,343) (132) (663) (119) (7) (19,055) (1,322) 2009 $000 (21,101) 232 (661) (90) (2,865) (127) (52) (17,038) (1,366)
Under the Jobs Credit Scheme (the Scheme), the Company received a range of 3 12% (2009: 12%) cash grant on the rst $2,500 of each months wages for each employee on their Central Provident Fund payroll. The Company received its grant income of $312,000 (2009: $232,000) during the year.
11.
INCOME TAX EXPENSE Major components of income tax expense The major components of income tax expense for the nancial years ended 30 June 2010 and 2009 are:Group 2010 $000 Current income tax:Current income taxation (Under)/overprovision in respect of previous years 2009 $000
(16,304) (3,018) (19,322)
(7,661) 791 (6,870)
Deferred income tax:Origination and reversal of temporary differences
686
(45)
Income tax expense recognised in the prot or loss
(18,636)
(6,915)
68
30 June 2010
11.
INCOME TAX EXPENSE (CONTD) Relationship between tax expense and accounting prot The reconciliation between tax expense and product of accounting prot multiplied by the applicable corporate tax rate for the years ended 30 June 2010 and 2009 is as follows:Group 2010 % Domestic statutory tax rate Tax effect of:Exempt income Expenses not deductible for tax purpose (Under)/overprovision of taxation in respect of prior years Effect of tax rates in different jurisdictions Deferred tax assets not recognised Others Effective tax rate (17.0) 6.4 (5.9) (2.6) 0.2 3.7 (15.2) 2009 % (17.0) 135.8 (34.5) 9.7 (1.3) (191.7) 14.0 (85.0)
The taxation charge is computed on the net prot derived from operations, excluding Singapore tax-exempt dividend income and those related to shipping operations which are exempted from taxation by virtue of Section 13A of the Singapore Income Tax Act. The above reconciliation is prepared by aggregating separate reconciliations for each national jurisdiction.
69
30 June 2010
12.
EARNINGS PER SHARE Basic earnings per share amounts are calculated by dividing prot for the year attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the nancial year. Diluted earnings per share amounts are calculated by dividing prot for the year attributable to ordinary equity holders of the parent by the weighted average number of ordinary shares outstanding during the nancial year plus the weighted average number of ordinary shares that would be issued on the conversion of all the dilutive potential ordinary shares into ordinary shares. The following tables reect the prot and share data used in the computation of basic and diluted earnings per share computations for the nancial years ended 30 June:Group 2010 $000 Prot after taxation attributable to ordinary equity holders of the parent used in the computation of basic and diluted earnings per share 2009 $000
103,715 No. of shares 000
1,195 No. of shares 000 771,702 771,702
Weighted average number of ordinary shares for basic earnings per share computation Effect of dilution:Share options Weighted average number of ordinary shares for diluted earnings per share computation
771,702 771,702
70
30 June 2010
13.
INTANGIBLE ASSETS Shoreline agreement $000 Club membership $000
Group
Goodwill $000
Total $000
Cost: At 1 July 2008, 30 June 2009 and 1 July 2009 Impairment loss At 30 June 2010 Accumulated amortisation: At 1 July 2008 Amortisation Impairment loss At 30 June 2009 and 1 July 2009 Amortisation Impairment loss At 30 June 2010 Net carrying amount: At 30 June 2010 At 30 June 2009
6,233 6,233
2,844 (2,844)
233 233
9,310 (2,844) 6,466
6,233 6,233 6,233
68 110 178 101 (279)
68 110 6,233 6,411 101 (279) 6,233
2,666
233 233
233 2,899
Shoreline agreement
The shoreline agreement was acquired as part of a business combination. The agreement grants the Group the right to use the shoreline at a favourable rate as compared to the market rental rate for locations in the vicinity. It is amortised on a straight line basis over its nite useful life, which is determined based on the remaining period of 26 (2009: 27) years. During the nancial year, an impairment loss was recognised to write down the carrying amount of shoreline agreement as the subsidiary has ceased operations. An impairment loss of $2,565,000, (2009: $Nil) has been recognised in the prot or loss under the line item Other expenses. Club Membership $000 106
Company
At 1 July 2008, 30 June 2009 and 30 June 2010
71
30 June 2010
14.
LAND USE RIGHTS Group 2010 $000
Cost: At 1 July 2008 Currency translation difference At 30 June 2009 and 1 July 2009 Currency translation difference Impairment loss At 30 June 2010 Accumulated amortisation: At 1 July 2008 Amortisation for the year At 30 June 2009 and 1 July 2009 Amortisation for the year Impairment loss At 30 June 2010 Net carrying amount: At 30 June 2010 At 30 June 2009
1,366 79 1,445 (19) (1,426)
13 17 30 18 (48)
1,415
The Group has acquired land use rights over one plot of state-owned land in the Peoples Republic of China (PRC) where the Groups shipbuilding activities are carried out. The land use rights are not transferable and have a remaining tenure of 46 (2009: 47) years. During the nancial year, an impairment loss of $1,378,000 (2009: $Nil) has been recognised in the prot or loss under the line item Other expenses subsequent to the managements assessment as stated in Note 13 on shoreline agreement.
72
30 June 2010
15.
FIXED ASSETS Leasehold land and buildings $000 Cranes and motor vehicles $000
Group
Vessels $000
Other assets $000
Constructionin-progress $000
Total $000
Cost: At 1 July 2008 Transfer to vessels held for sale Transfer to work-in-progress Additions Disposals Transfer from xed assets under construction Written off Currency translation difference At 30 June 2009 and 1 July 2009 Transfer to work-in-progress Additions Disposals Transfer from xed assets under construction Written off Currency translation difference Impairment loss At 30 June 2010
283,252 (42,028) 5,939 (87,926) 109,325 490 269,052 (50,933) 105,287 (44,993) 34,407 312,820
10,592 3,119 3 13,714 972 (63) (2,204) 12,419
4,596 2,333 (46) (60) 6,823 87 (53) (1,686) 5,171
9,248 3,867 (1) (40) 13,074 4,584 (49) (157) (7,740) 9,712
155,639 (76,744) 176,199 (109,325) (52) 553 146,270 (54,715) 37,536 (34,407) (97) (52) 94,535
463,327 (42,028) (76,744) 191,457 (87,973) (52) 946 448,933 (105,648) 148,466 (44,993) (49) (370) (11,682) 434,657
73
30 June 2010
15.
FIXED ASSETS (CONTD) Leasehold land and buildings $000 Cranes and motor vehicles $000
Group
Vessels $000
Other assets $000
Constructionin-progress $000
Total $000
Accumulated depreciation: At 1 July 2008 Transfer to vessels held for sale Depreciation charge for the year Disposals Currency translation difference At 30 June 2009 and 1 July 2009 Transfer to work-in-progress Depreciation charge for the year Disposals Written off Currency translation difference Impairment loss At 30 June 2010 Net book value: At 30 June 2010 At 30 June 2009
42,055 (5,250) 15,003 (13,693) 477 38,592 (1,029) 16,656 (14,763) 39,456 273,364 230,460
6,532 733 9 7,274 1,044 (6) (389) 7,923 4,496 6,440
4,344 456 (15) (8) 4,777 405 (12) (535) 4,635 536 2,046
6,442 846 17 7,305 950 (42) (22) (983) 7,208 2,504 5,769
94,535 146,270
59,373 (5,250) 17,038 (13,708) 495 57,948 (1,029) 19,055 (14,763) (42) (40) (1,907) 59,222 375,435 390,985
Other assets comprise plant and machinery, equipment tools, ofce equipment and furniture and ttings. Completed vessels owned by JML, AJM, JSE Shipping Pte Ltd and AJM Shipping Pte Ltd, an uncompleted vessel of AJM, and the leasehold property in Singapore owned by JSE are mortgaged to secure bank borrowings of the Group (Note 29). The bank borrowings are also secured by a oating charge over all other assets of the Company, JSE, JML and AJM. During the nancial year, an impairment loss of $9,775,000 (2009: $Nil) on xed assets of Nantong Dongjiang Shipyard Company Limited has been recognised in the income statement under the line item Other expenses subsequent to the managements assessment as stated in Note 13 on shoreline agreement.
74
30 June 2010
15.
FIXED ASSETS (CONTD) Group Vessel held for sale At 1 July Add: Transferred from xed assets Less: Vessels sold At 30 June 2010 $000 5,958 (5,958) 2009 $000 36,778 (30,820) 5,958
1 vessel held for sale has been disposed of in FY2010 together with 7 other vessels resulting in a total gain on disposal of $30,930,000 (2009: $64,460,000).
16.
SUBSIDIARY COMPANIES Company 2010 2009 $000 $000 Unquoted shares, at cost Less: Impairment in value of investments in subsidiary companies 34,674 (2,797) 31,877 18,723 50,600 An analysis of impairment in value of investments in subsidiary companies: At 1 July Impairment loss for the nancial year Reversal of impairment loss on liquidation of subsidiary company At 30 June Details of the subsidiary companies are set out in Note 5. # The long term loan to a subsidiary company forms part of the Companys net investment in the subsidiary company. The loan is unsecured, interest-free and is not expected to be repayable in the foreseeable future. 34,674 (2,796) 31,878 10,623 42,501
Long term loan to a subsidiary company #
2,796 1 2,797
2,982 45 (231) 2,796
All issued and paid up shares in JSE, JML and Jaya Offshore Pte Ltd (JO) held by the Company, and all issued and paid up shares in AJM held by JO, are mortgaged to secure bank borrowings of the Group (Note 29). The bank borrowings are also secured by a oating charge over all other assets of the Company, JSE, JML and AJM.
75
30 June 2010
17.
ASSOCIATED COMPANIES Group 2010 $000 Unquoted shares, at cost Share of post-acquisition prots (net of tax) Share of translation reserve Elimination of unrealised prot Long term loan to an associated company ## 345 8,268 (573) (2,716) 5,324 1,673 6,997 2009 $000 1,595 6,908 (382) (3,031) 5,090 1,737 6,827 Company 2010 2009 $000 $000 170 170 1,673 1,843 170 170 1,737 1,907
The summarised nancial information of associated companies, not adjusted for the proportion of ownership interest held by the Group, is as follows: Group 2010 $000 Total assets Total liabilities Total revenue Prot after taxation Details of the associated companies are set out in Note 5. ## The long term loan to an associated company forms part of the Companys net investment in the associated company. The loan is unsecured, interest-free and is not expected to be repayable in the foreseeable future. 31,826 15,325 10,427 2,423 2009 $000 28,623 11,958 10,666 3,649
76
30 June 2010
18.
STOCKS AND WORK-IN-PROGRESS Group 2010 $000 Raw materials and consumables, at lower of cost and net realisable value Work-in-progress: Cost less impairment loss 11,167 258,712 269,879 2009 $000 4,931 378,725 383,656
Raw materials and consumables of the Group are stated after recognition of the following expense in the income statement: -
Stocks written down
1,880
During the nancial year, there was a write back of the provision for cancellation/deferment costs of $3,198,000 (Note 8) (2009: impairment loss of work-in-progress of $8,227,000) after discussions with the suppliers for the associated projects were completed. Interest expense capitalised in stocks and work-in-progress during the year was $1,778,000 (2009:$3,849,000).
19.
GROSS AMOUNT DUE FROM/(TO) CUSTOMERS FOR CONTRACT WORK Group 2010 $000 Cost and attributable prots Less: Progress billings Amount due from customers for contract work, net Presented as: Gross amount due from customers for contract work Gross amount due to customers for contract work 2009 $000 59,263 (31,317) 27,946
29,677 (1,731) 27,946
77
30 June 2010
20.
TRADE RECEIVABLES Group 2010 $000 Trade receivables external parties Other receivables and deposits (Note 21) Amounts due from subsidiary companies (Note 24) Trade and other receivables Add: Cash and cash equivalents (Note 25) Total loans and receivables 56,839 26,639 83,478 208,990 292,468 2009 $000 25,797 5,669 31,466 102,374 133,840 Company 2010 2009 $000 $000 1,151 3,744 134,865 139,760 184,799 324,559 89 4,660 142,153 146,902 64,381 211,283
Trade receivables are non-interest bearing and are generally on 60 day terms. They are recognised at their original invoice amounts which represent their fair values on initial recognition. Trade receivables of the Group are stated after deducting an allowance for doubtful debts of $5,780,000 (2009: $5,117,000). Receivables that are past due but not impaired The Group has trade receivables amounting to $14,085,000 (2009: $4,941,000) that are past due at the balance sheet date but not impaired. These receivables are unsecured and the analysis of their aging at the balance sheet date is as follows: Group 2010 $000 Trade receivables past due: 61 to 90 days 91 to 120 days More than 120 days 2009 $000
3,388 584 10,113 14,085
1,357 932 2,652 4,941
78
30 June 2010
20.
TRADE RECEIVABLES (CONTD) Receivables that are impaired Group 2010 $000 Trade receivables nominal amounts Less: Allowance for impairment 8,179 (5,780) 2,399 Movement in allowance account: At 1 July Charge for the nancial year At 30 June 2009 $000 8,320 (5,117) 3,203
5,117 663 5,780
2,252 2,865 5,117
Trade receivables that are individually determined to be impaired at the balance sheet date relate to slow-paying customers that are in nancial difculties. These receivables are not secured by any collateral or credit enhancements.
21.
OTHER RECEIVABLES AND DEPOSITS Group 2010 $000 Deposits Amount due from an associated company Advances to staff Sundry receivables 22,742 3,177 64 656 26,639 2009 $000 1,494 3,297 141 737 5,669 Company 2010 2009 $000 $000 3,177 567 3,744 1,004 3,297 1 358 4,660
The amount due from an associated company is non-trade in nature, unsecured, bears interest at 7.00% (2009: 7.00%) per annum and is repayable on demand.
79
30 June 2010
22.
PREPAYMENTS Prepayments comprise advance payments to third party shipyards and deposits placed with equipment manufacturers for shipbuilding projects which have not started. During the nancial year, there was a net write back of the provision for impairment loss of prepayments of $20,226,000 (2009: $Nil) (Note 8) (2009: impairment loss of prepayments of $22,064,000) after discussions with the suppliers for the associated projects were completed.
23.
DERIVATIVE FINANCIAL INSTRUMENTS Group 2010 $000 Contract/ notional amount Foreign exchange forward contracts: - Bought contracts Euro Norwegian Kroner United States Dollar - Sold contracts United States Dollar Structured options: - Bought contracts Euro Norwegian Kroner Japanese Yen - Sold contracts United States Dollar Total derivatives Contract/ notional amount 2009 $000
Assets
Liabilities
Assets
Liabilities
1,085
(5)
4,082 5,125
(288) (986)
4,341
(162) (1,441)
Foreign exchange forward contracts and structured options are used to hedge the Groups sales and purchases denominated in United States Dollar, Euro, Norwegian Kroner and Japanese Yen for which rm commitments existed at the balance sheet date. These foreign exchange forward contracts and structured options have matured during the year. The Group does not apply hedge accounting.
80
30 June 2010
24.
AMOUNTS DUE FROM/(TO) SUBSIDIARY COMPANIES The amounts due from/(to) subsidiary companies are non-trade in nature, unsecured, interest-free and repayable on demand. The amounts due from subsidiary companies relate mainly to advances for working capital use. The amounts due to subsidiary companies relate mainly to transfer of surplus funds from certain subsidiary companies to the holding company.
25.
CASH AND CASH EQUIVALENTS Cash and cash equivalents consist of cash on hand, current accounts with banks and xed deposits. Group 2010 $000 Cash and bank balances Fixed deposits 205,551 3,439 208,990 Cash at banks earns interest at oating rates based on daily bank deposit rates. Fixed deposits earn interest at effective interest rates ranging from 0.1% to 0.25% (2009: 0.01% to 5.31%) per annum and mature within 5 days (2009: 1 month) from the nancial year end. Short-term deposits are made for weekly basis , and earn interests at the respective short-term deposit rates. 2009 $000 5,748 96,626 102,374 Company 2010 2009 $000 $000 184,799 184,799 424 63,957 64,381
81
30 June 2010
26.
TRADE CREDITORS AND ACCRUALS Group 2010 $000 Trade creditors Deposits from customers Deferred income Accruals Trade creditors and accruals Less: Deposits from customers Trade creditors and accruals - nancial liabilities Add: Amounts due to subsidiary companies (Note 24) Other creditors - nancial liabilities (Note 28) Bank borrowings (Note 29) Total nancial liabilities carried at amortised cost 23,521 5,081 24,667 53,269 2009 $000 94,422 289 1,748 17,055 113,514 (289) Company 2010 2009 $000 $000 932 301 1,233 1,320 265 1,585
53,269 7,147 359,663 420,079
113,225 25,795 369,988 509,008
1,233 133,213 16 5,934 140,396
1,585 7,568 83 6,000 15,236
27.
PROVISION Group 2010 $000 Movement in provision account: At 1 July Charge for the nancial year Write back for the nancial year At 30 June Provision for associated costs A provision is recognised for the expected cash outows for the cancellation and deferment of certain committed purchase orders, which is in relation to the Groups efforts in rationalising and optimising its vessel-build programme. Assumptions used to estimate the provision were based on current negotiations with key suppliers. During the nancial year, provision for associated shutdown costs of S$1,025,000 (2009: $nil) was provided for Nantong Dongjiang Shipyard Company Limited. The provision relates to restoration cost of the shipyard and potential penalty charges for failure to inject additional share capital of US$12,700,000. 2009 $000
69,138 1,025 (1,533) 68,630
69,138 69,138
82
30 June 2010
28.
OTHER CREDITORS Group 2010 $000 Amount due to an associated Company Amounts owing on purchase of xed assets Deposits received - disposal of xed assets - purchase option fee - disposal of vessels Advances from minority shareholders of subsidiary companies Purchase consideration to be paid for acquisition of subsidiary company Sundry creditors Interest payable Advances received from customers Other creditors Less: Deposits received - disposal of vessels/xed assets - purchase option fee Other creditors - nancial liabilities (Note 26) 4,967 3,672 6,153 35 136 985 1,024 16,972 2009 $000 1,099 19,596 579 14,090 35 409 289 4,301 66 40,464 Company 2010 2009 $000 $000 16 16 3 80 83
(6,153) (3,672) 7,147
(579) (14,090) 25,795
16
83
Amount due to an associated company is non-trade in nature, unsecured and interest-free. The amount relates to a return of shareholders funds pending the completion of a voluntary shareholders liquidation exercise being undertaken by the associated company which has been completed during the nancial year. Purchase option fee relates to deposits received from charter hire customers that give the customers the right to purchase vessels after one year of charter. Advances from minority shareholders of subsidiary companies are non-trade in nature, interest-free, unsecured and repayable on demand.
83
30 June 2010
29.
BANK BORROWINGS Group 2010 $000 Current: Unsecured USD loans SGD loans Non-current: Secured USD loans 121,533 248,455 369,988 6,000 6,000 2009 $000 Company 2010 2009 $000 $000
359,663
5,934
Total loans and borrowings
359,663
369,988
5,934
6,000
As stated in Note 2, the Groups unsecured bank borrowings was restructured into 5-year USD denominated secured obligations with a principal holiday for the rst two years and quarterly instalments over the subsequent three years. With the approval of the Scheme, the Group and the Company have reclassied current bank borrowings to non-current bank borrowings. Bank borrowings of the Group are secured with a xed charge over completed vessels owned by JML, AJM, JSE Shipping Pte Ltd and AJM Shipping Pte Ltd and an uncompleted vessel of AJM, a xed charge over the leasehold property in Singapore owned by JSE, a charge over all issued and paid up shares in JSE, JML and JO held by the Company, a charge over all issued and paid up shares in AJM held by JO and a oating charge over all other assets of the Company, JSE, JML and AJM (Notes 15 and 16). Prior to the approval of the Scheme, the unsecured current bank loans bore interests at 3% (2009:1.59% to 10.5%) per annum. With effect from 25 February 2010, the non-current secured bank loans bear interest at 2.5% per annum + Libor from 25 February 2010 to 31 December 2011, 2.625% per annum + Libor from 1 January 2012 to 31 December 2012, 2.875% per annum + Libor from 1 January 2013 to 31 December 2013 and 3.125% per annum + Libor from 1 January 2014 to 24 February 2015. As of 30 June 2010, the interest rate is 2.84% per annum.
84
30 June 2010
30.
DEFERRED TAXATION Deferred taxation arises as a result of:Group 2010 $000 Deferred tax liabilities:Differences in depreciation Fair value adjustments on acquisition of subsidiary company Write-back of deferred tax liabilities 2009 $000
40 635 (635) 40
69 657 726
An analysis of movement in deferred taxation is set out below: Group 2010 $000 At 1 July Originations and reversal of temporary differences At 30 June Unrecognised tax losses At the balance sheet date, the Group has tax losses of approximately $1,082,000 (2009 : $7,690,000) that are available for offset against future taxable prots of the respective companies in which the losses arose, for which no deferred tax asset is recognised due to uncertainty of its recoverability. The use of these tax losses is subject to the agreement of the tax authorities and compliance with certain provisions of the tax legislation of the respective countries in which the companies operate. Unrecognised temporary differences relating to impairment losses and provision for associated costs for cancellation and deferment of vessel projects At the balance sheet date, the Group has temporary differences relating to impairment losses and provision for associated costs for cancellation and deferment of vessel projects amounting to $67,605,000 (2009: $91,355,000). No deferred tax asset has been recognised due to uncertainty of its utilisation against future taxable prots. Unrecognised deferred tax asset is estimated to be $ 11,493,000 (2009: $15,530,000). 726 (686) 40 2009 $000 681 45 726
85
30 June 2010
31.
SHARE CAPITAL Group and Company 2010 2009 $000 $000 Issued and fully paid:Balance at 1 July 771,701,985 (2009: 771,612,985) ordinary shares Ordinary shares issued during the nancial year Nil (2009: 89,000) ordinary shares in respect of options exercised under the Employees Share Option Scheme Balance at 30 June 771,701,985 (2009: 771,701,985) ordinary shares The ordinary shares as at 30 June 2010 and 2009 have no par value. Equity compensation benets Jaya Employees Share Option Scheme (the ESOS) (i) Holders of share options granted under the ESOS are entitled to subscribe for the number of ordinary shares in the Company at an exercise price and during the exercise period applicable to the share options. The shares allotted pursuant to the exercise of share options granted under the ESOS will rank pari passu with the existing issued shares of the Company. The share options granted to participants are only exercisable after the rst anniversary of the date of grant. The share options granted have a life span of 5 to 10 years from the date of grant and are to be settled by equity. From the commencement of the ESOS to 30 June 2010, no share options have been granted under the ESOS to any controlling shareholders of the Company and their associated companies. The share options granted by the Company do not entitle the holders of the options, by virtue of such holdings, to any rights to participate in any share issues of any other company in the Group. No share option has been granted at a discount to the Market Price. There are no participants who received 5% or more of the total number of options available under the ESOS during the nancial year. During the nancial year, no share options are granted to take up unissued ordinary shares of the subsidiary companies and no ordinary shares of the subsidiary companies are issued by virtue of the exercise of an option to take up unissued ordinary shares.
126,460
126,315
145
126,460
126,460
(ii)
(iii)
(iv)
(v) (vi)
(vii)
(viii) At the end of the nancial year, there are no other unissued ordinary shares of the Company and its subsidiary companies under options except as disclosed below.
86
30 June 2010
31.
SHARE CAPITAL (CONTD) The options granted, exercised and cancelled under the ESOS during the nancial year and the options outstanding at the end of the nancial year are as follows:2010 Options outstanding at 1.7.2009 121,000 Options outstanding at 30.6.2010 Exercise period 70,500 10 December 2004 to 9 December 2013 6 December 2005 to 6 December 2014 25 November 2006 to 24 November 2010 25 November 2006 to 24 November 2015 30 April 2008 to 29 April 2012 30 April 2008 to 29 April 2017
ESOS Grant Number 9
Exercise price per share $0.769
Options granted
Options exercised
Options cancelled (50,500)
10
$1.02
341,000
(100,000)
241,000
11
$1.238
95,000 849,750
(243,900)
95,000 605,850
12
$1.456
500,000 6,388,000 8,294,750
(660,000) (1,054,400)
500,000 5,728,000 7,240,350
The weighted average share price at the date of exercise for options exercised during the nancial year was nil (2009: $1.59).
87
30 June 2010
31.
SHARE CAPITAL (CONTD) 2009 Options outstanding at 1.7.2008 121,000 Options outstanding at 30.6.2009 Exercise period 121,000 10 December 2004 to 9 December 2013 6 December 2005 to 6 December 2014 25 November 2006 to 24 November 2010 25 November 2006 to 24 November 2015 30 April 2008 to 29 April 2012 30 April 2008 to 29 April 2017
ESOS Grant Number 9
Exercise price per share $0.769
Options granted
Options exercised
Options cancelled
10
$1.02
421,000
(80,000)
341,000
11
$1.238
95,000 1,309,450
(4,000)
(455,700)
95,000 849,750
12
$1.456
500,000 7,448,000 9,894,450
(85,000) (89,000)
(975,000) (1,510,700)
500,000 6,388,000 8,294,750
The weighted average share price at the date of exercise for options exercised during the nancial year ended 30 June 2009 was $1.59 (2008: $1.83).
32.
SHARE OPTION RESERVE Share option reserve comprises the cumulative value of employee services received for the issue of share options. When the option is exercised, the amount from the share option reserve is transferred to share capital. When the share options expire, the amount from the share option reserve is transferred to revenue reserve. Movement in share option reserve for the Group and Company is disclosed in the Statements of Changes in Equity.
88
30 June 2010
33.
DIVIDENDS ON ORDINARY SHARES Group and Company 2010 2009 $000 $000 Dividends paid during the nancial year:Interim exempt (one-tier) dividend of nil (2009: 1 cents) per ordinary share Final exempt (one-tier) dividend of nil (2009: 7.5 cents) per ordinary share
7,717 57,878 65,595
34.
SIGNIFICANT RELATED PARTY TRANSACTIONS Related parties refer to key management personnel of the Group (including directors), minority shareholders of subsidiary companies, and associated companies. During the nancial year, the Group entered into the following signicant related party transactions and the effect of these transactions on the basis determined between the parties were reected in the nancial statements as follows:Group 2010 $000 Associated companies:Shipmanagement fee income Interest income 216 225 Group 2009 $000 226 232
Compensation of key management personnel

Directors fees Directors remuneration Employers contribution to dened contribution plans for directors
2010 $000 201 3,020 10 3,231
2009 $000 323 993 8 1,324 1,044 39 1,083 2,407
Executive ofcers remuneration Employers contribution to dened contribution plans for executive ofcers
2,266 45 2,311
Total directors and executive ofcers remuneration
5,542
Directors and executive ofcers interests in employee share option

At balance sheet date, the total number of outstanding share options granted by the Company to the directors and executive ofcers of the Group amount to 1,395,000 and 425,000 (2009: 1,395,000 and 425,000) respectively.
89
30 June 2010
35.
OPERATING LEASE COMMITMENTS (a)
Non-cancellable operating lease commitments in respect of land Group as a lessee

The Group leases land in Singapore and in the Peoples Republic of China (PRC) under non-cancellable lease arrangements. Future minimum rentals under non-cancellable operating leases as at 30 June are as follows:Group 2010 $000 Future minimum lease payments - within one year - within two to ve years - later than ve years 282 31 157 470 2009 $000 290 254 171 715
Rental expenses were $318,399 and $325,739 for the nancial years ended 30 June 2010 and 30 June 2009 respectively. The above operating leases do not provide for contingent rents. Lease terms do not contain restrictions on the Groups activities concerning dividends, additional debts or entering into other leasing agreements. The lease in Singapore expires in the year 2011 and contains provisions for rental adjustments that are based on the market value of the land. The lease in the PRC expires in year 2036 and contains provisions for rental adjustments that are subject to mutually agreed terms. The Group has submitted application to JTC Corporation to extend the lease in Singapore for ten years up to April 2021. The application is currently being processed. (b)
Operating lease commitments in respect of ship chartering Group as a lessor

The Group entered into charter hire contracts with third parties relating to the leasing of its eet of vessels. Future minimum charter hire receivables under operating leases as at 30 June are as follows:Future minimum charter hire receivables - within one year - within two to ve years
37,522 17,351 54,873
62,154 42,467 104,621
These leases have remaining lease terms ranging from 1 month to 2.67 years (2009: 1 month to 3.67 years). Certain leases contain renewable options at rental rates based on negotiations. Relating to the above, operating lease commitments that are cancellable upon exercise of purchase options by customers are as follows:Future minimum charter hire receivables - within one year - within two to ve years
13,040 16,213 29,253
31,799 30,549 62,348
90
30 June 2010
36.
COMMITMENTS Commitments in respect of contracts approved and placed for the purchase of materials and subcontracted labour for the construction of vessels amounted to $241,810,000 (2009: $566,551,000) as at 30 June 2010. The Group has a capital commitment to inject US$12,700,000 (2009: US$12,700,000) in relation to investment in a subsidiary, Nantong Dongjiang Shipyard Company Limited. However, as the Group has wound down its operations at this shipyard, the Group has no intention to inject further capital. The Group is currently working with the local authorities to apply for reduction in its registered capital. Upon obtaining the approval, the capital commitment of the Group in relation to investment in Nantong Dongjiang Shipyard Company Limited will be reduced accordingly.
37.
CORPORATE GUARANTEES Corporate guarantees given are as follows:Company 2010 2009 $000 $000 Corporate guarantees given to secure banking facilities for subsidiary companies
354,068
748,679
Corporate guarantees given to a customer

In 2003, a subsidiary company of the Company was awarded two 20-year contracts, each for the charter of a vessel to a Malaysian party, FPSO Tech Sdn Bhd (FPSO Tech). As the vessels had to y the Malaysian ag, a condition which could not be satised by the subsidiary company, the subsidiary company had sold the vessels to the Companys then Malaysian associated company, Alam Maritim (M) Sdn Bhd (Alam) and also assigned the contracts to it. In August 2003, the Company issued two related corporate guarantees to FPSO Tech on Alams ability to perform the contracts over their duration. When the Company disposed of its stake in Alam in March 2005, FPSO Tech did not agree to release the Company of its corporate guarantees. Should Alam fail to perform their obligations under the charter contracts, the Company as a guarantor will have to provide substitute vessels to fulll such obligations. However, as the charter contracts are protable, the Company is not expected to incur any loss if it ever had to be called upon to perform them. Furthermore, the Company has obtained counter indemnities in the form of corporate guarantees by SAR Venture Sdn Bhd (SAR), the holding company of Alam, and personal guarantees of all the shareholders of SAR, indemnifying the Company against any liability whatsoever in respect of its corporate guarantees to FPSO Tech. In addition, Alam has provided the Company with a bank guarantee on a demand basis for the amount of US$116,000 (2009: US$116,000).
91
38.
SEGMENT INFORMATION
The Groups operating businesses are organised and managed into 2 (2009: 3) main operating divisions, namely the Offshore Shipping and Shipbuilding Divisions. The Offshore Shipping Division is mainly engaged in the owning and chartering of offshore support vessels in serving the offshore oil and gas, marine construction, mining, harbour tug operations and other related industries. The Shipbuilding Division is mainly engaged in the building of vessels and vessel sale activities. The Conventional Shipping Division which is mainly engaged in the owning and chartering of a product tanker, has been dormant since the disposal of last vessel in November 2008.
Segment accounting policies are the same as the policies described in Note 3.24 Inter-segment sales and transfers are carried out on an arms length basis. Segment results, assets and liabilities include items directly attributable to a segment as well as those expenses, assets and liabilities that can be allocated on a reasonable basis. Segment assets consist primarily of xed assets, current assets and exclude club memberships. Segment liabilities comprise mainly operating liabilities and exclude taxation liabilities.
Business segments
Financial information about business segments is presented as follows:-
Group
30 June 2010
Offshore Shipping 2010 2009 $000 $000
Conventional Shipping 2010 2009 $000 $000 Shipbuilding 2010 2009 $000 $000
Corporate & Other Segment 2010 2009 $000 $000
Eliminations 2010 2009 $000 $000
Consolidated 2010 2009 $000 $000
92 90,129 3 90,132 528 334,669 175,863 528 292,954 41,715 172,514 3,349 57 (6,907) (16,363) 2,123 33 (262) 2,194 (4,290) (791) 816 (2,596) (540) 576 (166) 277 (223) 23,425 (1,025) (1,378) (2,565) (99,429) (6,233)
Sales to external customers Inter-segment sales (1)
64,109 19
(41,734) (41,734)
(3,352) (3,352)
357,063 357,063
263,171 263,171
Total revenue
64,128
288 (4,512) (18,383)
3,058 (8,968) (19,174) 1,527
1,183 (9,726) (17,165) 2,123
1,527
23,425 (1,025) (1,378) (2,565)
(99,429) (6,233)
Results: Interest income Interest expenses Depreciation and amortization Share of prots of associated companies, net of tax Reversal of impairment losses/ (impairment losses and provisions for associated costs) Impairment of goodwill Provision for associated shut down cost Impairment of land use rights Impairment of shoreline agreement
38.
SEGMENT INFORMATION (CONTD)
Business segments (contd)
Group
Offshore Shipping 2010 2009 $000 $000 (549) 73,390 (9) 542 81,655 (87,713) (3,828) 31,505 2,767 (9,586) 122,351 (18,636) 103,715 (2,865) (9,775) (114) (7) (52) (9,775) (663) (7) (2,865) (52) 8,138 (6,915) 1,223
Conventional Shipping 2010 2009 $000 $000 Shipbuilding 2010 2009 $000 $000 Eliminations 2010 2009 $000 $000 Consolidated 2010 2009 $000 $000
Corporate & Other Segment 2010 2009 $000 $000
Impairment of xed assets Impairment of trade receivables Other non-cash expenses (2)
Segment prot/(loss) (3)
41,766
Taxation
Prot after taxation
30 June 2010
93 420,613 200,085 53 63 312,909 388,459 7,185 21 24 410,162 508,317 189,720 69,164 7,669
Assets: Investment in associated companies 8,443 Additions to non-current assets (4) 142,822 8,334 182,137 5,644 9,320 1,843 1,907
(3,289) (7,083) 27,636
(3,414) (5,974) 20,481
6,997 148,466 1,005,058 526,170
6,827 191,457 992,144 616,757
Segment assets (5)
412,238
Segment liabilities (6)
178,387
(1)
(2)
Inter-segment revenues are eliminated on consolidation. Other non-cash expenses relate to xed assets written off.
30 June 2010
38.
Business segments (contd)

(3)
The following items are added to/(deducted from) segment prot to arrive at Prot before tax from continuing operations presented in the consolidated income statement: Group 2010 $000 Share of prots of associated companies Prot/(loss) from inter-segment sales 1,527 1,240 2,767 2009 $000 2,123 (11,709) (9,586)
(4)
Additions to non-current assets consist of construction of xed assets. The following items are added to/(deducted from) segment assets to arrive at total assets reported in the consolidated balance sheet: Investment in associated companies Inter-segment assets Unallocated assets (club memberships) 6,997 (14,313) 233 (7,083) 6,827 (13,034) 233 (5,974)
(5)
(6)
The following items are added to/(deducted from) segment liabilities to arrive at total liabilities reported in the consolidated balance sheet: Deferred taxation Provision for taxation 40 27,596 27,636 726 19,755 20,481
94
30 June 2010
38.
Geographical segments
The Groups business segments operate globally in 5 main geographical regions. Segment revenue is based on the geographical location of the Groups customers. Segment assets relating to the Groups chartering business are based on the geographical location of the Groups customers and other segment assets are based on the geographical location of the Groups assets. Revenue 2010 $000 North Asia South Asia Middle East America Europe Others 167,232 4,517 33,205 136,725 15,384 357,063 2009 $000 143,127 16,705 70,956 5,478 26,905 263,171 Non-Current Assets 2010 2009 $000 $000 375,668 375,668 13,762 381,537 395,299
Non-current assets information presented above consist of xed assets, land use rights and intangible assets as presented in the consolidated balance sheet.
Information about major customers

Revenue from two (2009: two) major customers amount to $96,180,850 (2009: $109,712,861), arising from sales by the shipbuilding segment.
39.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES The Group and the Company are exposed to nancial risks arising from its operations. The main risks of the Group are interest rate risk, liquidity risk, credit risk and foreign currency risk. The Board of Directors reviews and agrees policies for the management of these risks. The Group and the Company do not apply hedge accounting. The following sections provide details regarding the Groups and Companys exposure to the above-mentioned nancial risks and the objectives, policies and processes for the management of these risks. (a)
Interest rate risk

Interest rate risk is the risk that the fair value or future cash ows of the Groups and the Companys nancial instruments will uctuate because of changes in market interest rates. The Groups exposure to interest rate risk arises mainly from their bank borrowings and cash deposits placed with nancial institutions. For interest income from cash deposits, the Group manages the interest rate risk by placing cash deposits with reputable nancial institutions on varying maturities and interest rate terms.
95
30 June 2010
39.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTD) (a)
Interest rate risk (contd)

For interest expenses on borrowings, the Groups policy is to obtain the most favourable interest rates available after taking into account its foreign currency exposures. Other information related to interest rate risk is disclosed in Notes 25 and 29. Sensitivity analysis for interest rate risk The sensitivity analysis assumes an instantaneous 100 basis point change in the interest rate from the balance sheet date, with all other variables held constant. At the balance sheet date, if USD and SGD interest rates had been 100 (2009: 100) basis points lower/higher with all other variables held constant, the Groups prot before taxation would have been $3,580,000 (2009: $3,218,000) higher/lower. The assumed movement in basis points for interest rate sensitivity analysis is based on the currently observable market environment.
(b)
Liquidity risk
Liquidity risk refers to the risk which the Group encounters difculties in meeting its nancial obligations due to shortage of funds. The Groups and the Companys exposures to liquidity risk arise primarily from mismatches of the maturities of nancial assets and liabilities. The Groups and the Companys objectives are to maintain a balance between operating cash ows and term loans. The Groups surplus funds are also managed centrally by placing them with reputable nancial institutions on varying maturities. Analysis of nancial instruments by remaining contractual maturities The table below summarises the maturity prole of the Groups and the Companys nancial assets and liabilities at the balance sheet date based on contractual undiscounted repayment obligations. 2010 25 years $000 2009 25 years $000
1 year or less $000 Group Financial assets: Trade receivables Other receivables Cash and bank balances Total undiscounted nancial assets
Total $000
1 year or less $000
Total $000
56,839 26,639 208,990 292,468
56,839 26,639 208,990 292,468
25,797 5,669 102,374 133,840
25,797 5,669 102,374 133,840
96
30 June 2010
39.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTD) (b)
Liquidity risk (contd)

Group 2010 25 years $000 2009 25 years $000
1 year or less $000 Financial liabilities: Trade creditors and accruals Other creditors Bank borrowings Derivative nancial liabilities Total undiscounted nancial liabilities Total net undiscounted nancial assets/ (liabilities) Company Financial assets: Trade receivables Other receivables Amounts due from subsidiary companies Cash and bank balances Total undiscounted nancial assets Financial liabilities: Trade creditors and accruals Other creditors Bank borrowings Amounts due to subsidiary companies Total undiscounted nancial liabilities Total net undiscounted nancial assets/ (liabilities)
Total $000
1 year or less $000
Total $000
(53,269) (53,269) (7,147) (7,147) (402,086) (402,086) (60,416) (402,086) (462,502)
(113,225) (25,795) (380,575) (1,441) (521,036)
(113,225) (25,795) (380,575) (1,441) (521,036)
232,052
(402,086) (170,034)
(387,196)
(387,196)
1,151 3,744 134,865 184,799 324,559
1,151 3,744 134,865 184,799 324,559
89 4,660 142,153 64,381 211,283
89 4,660 142,153 64,381 211,283
(1,233) (16) (133,213) (134,462)
(1,233) (16) (6,857) (6,857) (133,213) (6,857) (141,319)
(1,585) (83) (6,166) (7,568) (15,402)
(1,585) (83) (6,166) (7,568) (15,402)
190,097
(6,857) 183,240
195,881
195,881
97
30 June 2010
39.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTD) (b)
Liquidity risk (contd)

The table below shows the contractual expiry by maturity of the Group and Companys contingent liabilities and commitments. The maximum amount of the nancial guarantee contracts are allocated to the earliest period in which the guarantee could be called. 2010 25 years $000 2009 25 years $000
1 year or less $000 Group Financial guarantees Purchase order commitments (c)
Total $000
1 year or less $000
Total $000
471 129,310
112,500
471 241,810
43,475 324,741
477 241,810
43,952 566,551
Credit risk
Credit risk arises mainly from the risk of counterparties defaulting on the terms of their agreements. The Groups objective is to seek continual revenue growth while minimising losses incurred due to increased credit risk exposure. The Group has no signicant concentration of credit risk with any single counterparty and monitors its exposure to credit risks arising from sales to customers on an on-going basis where credit evaluations are performed on customers requiring credit over a certain amount. The Groups exposure to credit risk arises primarily from trade and other receivables. For other nancial assets (including cash and cash equivalents and derivatives), the Group minimises credit risk by dealing exclusively with high credit rating counterparties. Exposure to credit risk At balance sheet date, the Groups and the Companys maximum exposure to credit risk is represented by: The carrying amount of each class of nancial assets recognized in the balance sheets A nominal amount of $354,068,000 (2009: $748,679,000) relating to a corporate guarantee to secure bank facilities for subsidiary companies
Credit risk concentration prole At the balance sheet date, the Groups maximum exposure to credit risk for trade receivables at the balance sheet date is as follows:Group 2010 2009 $000 % of total $000 % of total By business activities: Shipbuilding and ship repair Ship chartering Others
28,971 26,717 1,151 56,839
51% 47% 2% 100%
5,242 20,465 90 25,797
20% 79% 1% 100%
98
30 June 2010
39.
FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (CONTD) (c)
Credit risk (contd)

At the balance sheet date, approximately: 71% (2009: 53%) of the Groups trade receivables were due from 5 (2009: 5) major customers who are multiindustry conglomerates. Financial assets that are neither past due nor impaired Trade and other receivables that are neither past due nor impaired are creditworthy debtors with good payment record with the Group. Cash and cash equivalents are neither past due nor impaired are placed with or entered into with reputable nancial institutions with high credit ratings and no history of default. Financial assets that are either past due or impaired Information regarding nancial assets that are either past due or impaired is disclosed in Note 20.
(d)
Foreign currency risk

The Group has transactional currency exposures arising from sales or purchases that are denominated in a currency other than SGD, primarily the United States Dollar (USD), the Euro (EUR), the Norwegian Kroner (NOK), the Japanese Yen (JPY) and Chinese Renminbi (RMB). The Group and the Company also hold cash and cash equivalents denominated in foreign currencies for working capital purposes. As at balance sheet date, such foreign currency balances (mainly in USD) amounted to $147,444,000 (2009: $86,587,000) and $144,006,000 (2009: $64,222,000) for the Group and Company respectively. The Group does not use foreign exchange forward contracts and swaps for trading purpose. The Group is also exposed to currency translation risk arising from its net investments in foreign operations. The Groups net investments in foreign operations are not hedged as currency positions in RMB and USD are considered to be longterm in nature. Sensitivity analysis for foreign currency risk A 5% strengthening of the following currencies against the SGD at the balance sheet date would have increased/ (decreased) prot before taxation by the amounts shown in the table below. This analysis assumes that all other variables are held constant and is performed on the same basis for the nancial year ended 2009. Group Prot before taxation 2010 2009 $000 $000 USD EUR NOK JPY RMB (8,228) 910 355 (22) 23 (3,184) (394) (396) (76) 20
A 5% weakening of the above currencies against SGD at the balance sheet date would have equal but opposite effect to the amounts shown above, on the basis that all other variables remain constant.
99
30 June 2010
40.
CAPITAL MANAGEMENT The Groups objective when managing capital is to safeguard the Groups ability to continue as a going concern in order to provide returns for shareholders and to maintain an optimal capital structure to reduce the cost of capital. The Group monitors capital using a gearing ratio, which is net debt divided by total equity attributable to equity holders of the parent. Net debt represents bank borrowings less cash and cash equivalents. No changes were made in the objectives, policies or processes during the nancial years ended 30 June 2010 and 2009. The gearing ratios as at 30 June 2010 and 2009 are as follows:Group 2010 $000 Bank borrowings (Note 29) Less: Cash and cash equivalents (Note 25) Net debt Equity attributable to equity holders of the parent Gearing ratio 359,663 (208,990) 150,673 478,884 31% 2009 $000 369,988 (102,374) 267,614 375,383 71%
41.
FAIR VALUE OF FINANCIAL INSTRUMENTS The fair value of a nancial instrument is the amount at which the instrument could be exchanged or settled between knowledgeable and willing parties in an arms length transaction, other than in a forced or liquidation sale. (i)
Financial instruments whose carrying amounts approximate fair value

Cash and bank balances, xed deposits, trade and other receivables, trade and other creditors, amounts due from/(to) subsidiary companies and bank borrowings The carrying amounts of these nancial assets and liabilities are reasonable approximations of fair values, due to their short term nature or that they are oating rate instruments that are frequently repriced to market interest rates.
(ii)
Financial instruments whose fair values cannot be reliably determined

Long term loans to subsidiary company and associated company These loans are not expected to be repayable in the foreseeable future, as they are repayable only when the cash ows of the borrowers permit. Accordingly, the fair values of the loans are not determinable as the timing of the future cash ows arising from the loans cannot be estimated reliably.
100
30 June 2010
42.
LITIGATION On 27 March 2009, a sub-contractor of a contractor engaged by P.T. Jaya Asiatic Shipyard (PTJAS), a wholly-owned subsidiary company of the Group, led a claim against the contractor of PTJAS, naming PTJAS as the co-defendant, for a sum of equivalent to $219,351 and interest of 5% per month being payment for a project, plus damages in the sum of Rp.12,509,000,000 (approximately $1,876,350). The claim was for default in payment for services rendered for fabrication and piping works on a vessel. The case against PTJAS was dismissed by District Court of Batam, Indonesia on 23 December 2009 on the basis that there is no legal (contractual) relationship between PTJAS and the sub-contractor. In February 2010, the sub-contractor appealed to the High Court in Pekan Baru, Indonesia. Decision of the District Court was upheld by the High Court in Pekan Baru, Indonesia in June 2010. The sub-contractor led a further appeal to the Supreme Court in Jakarta, Indonesia. At the date of the audit report, the case is pending. The Group did not make any provision for the claim as there is no contractual relationship between PTJAS and the sub-contractor. The Group has sought legal advice and is of the view that the Group has valid defence to deny the sub-contractors claims and intends to defend the case vigorously.
43.
COMPARATIVE FIGURES Certain prior year comparatives have been reclassied to better reect the nature of the balances and to conform to the current years presentation. Group As As previously reclassied classied 2009 2009 $000 $000 Presentation in the consolidated income statement: General and administrative expenses Interest expenses Presentation in Note 9: Interest expense on bank borrowings Less: Capitalised in work-in-progress
(8,120) (9,726) (13,575) 3,849 (9,726)
(4,271) (13,575) (13,575) (13,575)
Presentation in Note 34: Executive ofcers remuneration* Employers contribution to dened contribution plans for executive ofcers* *
1,044 39
3,138 181
The executive ofcers remuneration and employers contribution to dened contribution plans for executive ofcers for 2009 have been reclassied to conform with the current years denition of executive ofcers as adopted by the Group for the year ended 30 June 2010.
44.
AUTHORISATION OF FINANCIAL STATEMENTS The nancial statements for the nancial year ended 30 June 2010 were authorised for issue in accordance with a resolution of the directors on 18 September 2010.
101
D E TA I L S O F P R O P E R T I E S
For The Financial Year Ended 30 June 2010
As at 30 June 2010, the leasehold properties of the Group consist of the following : Approximate Area (in square metre)
Location Singapore: 13 Tuas Crescent, Singapore 638707 Batam: Jalan Brigjen Katamso KM 6 Tanjung Uncang Batam Indonesia
Purpose Shipbuilding and administrative ofce
Tenure of Lease
24,939
30 years from 1981
Shipbuilding, shiprepair and administrative ofce
130,138
30 years from 1993
30,900
30 years from 1996
20,000
25 years from 2003
China: San Tiao Harbour Huiping County Qidong City Jiangsu Province PRC 226255
12,535
50 years from 2006
11,676
50 years from 2006
102
S H A R E H O L D E R S I N F O R M AT I O N
as at 8 September 2010
Number of equity securities Class of equity securities Voting rights
: : :
771,701,985 Ordinary share One vote per share
There are no treasury shares held in the issued share capital of the Company. STATISTICS OF SHAREHOLDINGS Size of Shareholdings 1 - 999 1,000 - 10,000 10,001 - 1,000,000 1,000,001 and above TOTAL No. of Shareholders 44 2,044 1,558 24 3,670 % 1.20 55.70 42.45 0.65 100.00 No. of Shares 14,376 13,097,143 89,047,066 669,543,400 771,701,985 % 0.00 1.70 11.54 86.76 100.00
SUBSTANTIAL SHAREHOLDERS (As recorded in the Register of Substantial Shareholders)
Direct Interest Nautical Offshore Services Nautical Offshore Holdings Afnity Asia Pacic Fund II LP FMR LLC FIL Ltd. -
% -
Deemed Interest 422,093,958 (1) 422,093,958 (2) 422,093,958 (3) 69,504,000 (4) 69,504,000 (4)
% 54.70 54.70 54.70 9.00 9.00
Notes: (1) (2) The deemed interest arises from the shares held in the name of its bank nominee, HSBC (Singapore) Nominees Pte Ltd. Nautical Offshore Holdings (NOH), through its 100% shareholding in Nautical Offshore Services (NOS), is deemed to have an interest in the shares held by NOS. Afnity Asia Pacic Fund II LP, through its 94.1% shareholding in NOH, which in turn has a 100% shareholding in NOS, is deemed to have an interest in the shares held by NOS. The deemed interest arises from the shares held in FID FDS Asia Pac Growth & Inc, Fidelity Asiastar Fund, Fidelity Northstar Fund Sub B and FID Low Priced Stock Fund.
(3)
(4)
103
S H A R E H O L D E R S I N F O R M AT I O N
as at 8 September 2010
TWENTY LARGEST SHAREHOLDERS No. Name 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 HSBC (Singapore) Nominees Pte Ltd Rafes Nominees (Pte) Ltd CIMB Securities (Singapore) Pte Ltd United Overseas Bank Nominees Pte Ltd DBS Nominees Pte Ltd Lim & Tan Securities Pte Ltd Citibank Nominees Singapore Pte Ltd Sing Investments & Finance Nominees Pte Ltd OCBC Securities Private Ltd Merrill Lynch (Singapore) Pte Ltd DBSN Services Pte Ltd UOB Kay Hian Pte Ltd OCBC Nominees Singapore Pte Ltd Cheong Poh Neo Pauline Lim Chin Choo Elizabeth DBS Vickers Securities (S) Pte Ltd Eka Tjandranegara Kim Eng Securities Pte. Ltd. Eastern Navigation Pte Ltd Boon Kia In Vincent Total No. of Shares 450,180,158 85,019,000 21,155,558 19,679,700 16,701,666 15,225,000 15,166,391 9,523,000 5,933,000 4,879,000 3,558,175 3,336,000 2,991,000 2,500,000 1,951,000 1,675,000 1,579,752 1,466,000 1,386,000 1,146,000 665,051,400 % 58.34 11.02 2.74 2.55 2.16 1.97 1.97 1.23 0.77 0.63 0.46 0.43 0.39 0.32 0.25 0.22 0.20 0.19 0.18 0.15 86.17
PERCENTAGE OF SHAREHOLDING IN PUBLICS HANDS Based on the information available to the Company as at 8 September 2010, approximately 35.11% of the Companys shares are held in the hands of the public. Accordingly, the Company has complied with Rule 723 of the Listing Manual of the SGX-ST.
104
NOTICE OF ANNUAL GENERAL MEETING
JAYA HOLDINGS LIMITED Company Registration No.: 199002391E Incorporated in the Republic of Singapore NOTICE IS HEREBY GIVEN that the Twentieth Annual General Meeting of Jaya Holdings Limited (the Company) will be held at 13 Tuas Crescent, Singapore 638707 on Wednesday, 20 October 2010 at 11.00 a.m. for the following purposes:
AS ORDINARY BUSINESS 1. To receive and adopt the Directors Report and the Audited Accounts of the Company for the nancial year ended 30 June 2010 together with the Auditors Report thereon. To re-elect the following Directors of the Company retiring pursuant to Article 92 of the Articles of Association of the Company: Mr Tang Kok Yew Mr Goon Kok Loon Mr Tang Kok Yew will, upon re-election as a Director of the Company, remain as the Non-Executive Chairman of the Company and a member of the Nomination Committee, and will be considered non-independent. Mr Goon Kok Loon will, upon re-election as a Director of the Company, remain as the Chairman of the Remuneration Committee, and will be considered independent. 3. To re-appoint Mr Lim Jiew Keng, a Director of the Company retiring under Section 153(6) of the Companies Act, Cap. 50, to hold ofce from the date of this Annual General Meeting until the next Annual General Meeting of the Company. [See Explanatory Note (i)] Mr Lim Jiew Keng will, upon re-appointment as a Director of the Company, remain as the Chairman of the Audit Committee and a member of the Nomination Committee, and will be considered independent. 4. To approve the payment of Directors fees of S$201,300 for the nancial year ended 30 June 2010 (2009: S$134,800). To re-appoint Messrs Ernst & Young LLP as the Auditors of the Company and to authorise the Directors of the Company to x their remuneration. To transact any other ordinary business which may properly be transacted at an Annual General Meeting. Resolution 2 Resolution 3
Resolution 1
2.
Resolution 4
Resolution 5
5.
Resolution 6
6.
By Order of the Board Yeo Poh Noi Caroline Secretary Singapore, 4 October 2010
105
NOTICE OF ANNUAL GENERAL MEETING
Explanatory Note: (i) The effect of the Ordinary Resolution 4 proposed in item 3 above, is to re-appoint a director of the Company who is 70 years of age.
Notes: 1. A Member entitled to attend and vote at the Annual General Meeting (the Meeting) is entitled to appoint a proxy to attend and vote in his/her stead. A proxy need not be a Member of the Company. The instrument appointing a proxy must be deposited at the Registered Ofce of the Company at 13 Tuas Crescent, Singapore 638707 not less than forty-eight (48) hours before the time appointed for holding the Meeting.
2.
106

Company Registration No.: 199002391E Incorporated in the Republic of Singapore
IMPORTANT: 1. For investors who have used their CPF monies to buy Jaya Holdings Limiteds shares, this Report is forwarded to them at the request of the CPF Approved Nominees and is sent solely FOR INFORMATION ONLY. This Proxy Form is not valid for use by CPF investors and shall be ineffective for all intents and purposes if used or purported to be used by them. CPF investors who wish to attend the Meeting as an observer must submit their requests through their CPF Approved Nominees within the time frame specied. If they also wish to vote, they must submit their voting instructions to the CPF Approved Nominees within the time frame specied to enable them to vote on their behalf.
2.
PROXY FORM
(Please see notes overleaf before completing this Form)
3.
I/We, of being a member/members of Jaya Holdings Limited (the Company), hereby appoint: Name Address NRIC/Passport No. Proportion of Shareholdings No. of Shares %
and/or (delete as appropriate) Name Address NRIC/Passport No. Proportion of Shareholdings No. of Shares %
or failing the person, or either or both of the persons, referred to above, the Chairman of the Meeting as my/our proxy/proxies to vote for me/us on my/our behalf at the Annual General Meeting (the Meeting) of the Company to be held on 20 October 2010 at 11.00 a.m. and at any adjournment thereof. I/We direct my/our proxy/proxies to vote for or against the Resolutions proposed at the Meeting as indicated hereunder. If no specic direction as to voting is given or in the event of any other matter arising at the Meeting and at any adjournment thereof, the proxy/proxies will vote or abstain from voting at his/her discretion. The authority herein includes the right to demand or to join in demanding a poll and to vote on a poll. (Please indicate your vote For or Against with a tick [] within the box provided.) No. Resolutions relating to: 1 2 3 4 5 6 Directors Report and Audited Accounts for the nancial year ended 30 June 2010 Re-election of Mr Tang Kok Yew as a Director Re-election of Mr Goon Kok Loon as a Director Re-appointment of Mr Lim Jiew Keng as a Director Approval of Directors fees amounting to S$201,300 Re-appointment of Messrs Ernst & Young LLP as Auditors day of 2010 For Against
Dated this
Total number of Shares in: (a) CDP Register Signature of Shareholder(s) or, Common Seal of Corporate Shareholder (b) Register of Members
No. of Shares
Notes : 1. Please insert the total number of Shares held by you. If you have Shares entered against your name in the Depository Register (as dened in Section 130A of the Companies Act, Chapter 50 of Singapore), you should insert that number of Shares. If you have Shares registered in your name in the Register of Members, you should insert that number of Shares. If you have Shares entered against your name in the Depository Register and Shares registered in your name in the Register of Members, you should insert the aggregate number of Shares entered against your name in the Depository Register and registered in your name in the Register of Members. If no number is inserted, the instrument appointing a proxy or proxies shall be deemed to relate to all the Shares held by you. A member of the Company entitled to attend and vote at a meeting of the Company is entitled to appoint one or two proxies to attend and vote in his/her stead. A proxy need not be a member of the Company. Where a member appoints two proxies, the appointments shall be invalid unless he/she species the proportion of his/her shareholding (expressed as a percentage of the whole) to be represented by each proxy. Completion and return of this instrument appointing a proxy shall not preclude a member from attending and voting at the Meeting. Any appointment of a proxy or proxies shall be deemed to be revoked if a member attends the meeting in person, and in such event, the Company reserves the right to refuse to admit any person or persons appointed under the instrument of proxy to the Meeting. The instrument appointing a proxy or proxies must be deposited at the registered ofce of the Company at 13 Tuas Crescent, Singapore 638707 not less than 48 hours before the time appointed for the Meeting. The instrument appointing a proxy or proxies must be under the hand of the appointor or of his attorney duly authorised in writing. Where the instrument appointing a proxy or proxies is executed by a corporation, it must be executed either under its seal or under the hand of an ofcer or attorney duly authorised. Where the instrument appointing a proxy or proxies is executed by an attorney on behalf of the appointor, the letter or power of attorney or a duly certied copy thereof must be lodged with the instrument. A corporation which is a member may authorise by resolution of its directors or other governing body such person as it thinks t to act as its representative at the Meeting, in accordance with Section 179 of the Companies Act, Chapter 50 of Singapore.
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General: The Company shall be entitled to reject the instrument appointing a proxy or proxies if it is incomplete, improperly completed or illegible, or where the true intentions of the appointor are not ascertainable from the instructions of the appointor specied in the instrument appointing a proxy or proxies. In addition, in the case of Shares entered in the Depository Register, the Company may reject any instrument appointing a proxy or proxies lodged if the member, being the appointor, is not shown to have Shares entered against his name in the Depository Register as at 48 hours before the time appointed for holding the Meeting, as certied by The Central Depository (Pte) Limited to the Company.

13 Tuas Crescent Singapore 638707 Tel: (65) 6265 1010 Fax: (65) 6864 5555 Email: enquiry@jayaholdings.com Website: www.jayaholdings.com Co Reg. No: 199002391E

Jaya Holdings Annual Report 2010

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Jaya Holdings Annual Report 2010

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M OVI NG AH EAD

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

CORPORATE MISSION STATEMENT

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

GROUP REVENUE ($000)

PROFIT ATTRIBUTABLE TO SHAREHOLDERS ($000)

149,750 120,774 107,328 103,715

120,000 100,000 80,000 60,000 40,000 20,000 0.00

EARNINGS PER SHARE (CENTS)

NET ASSET BACKING PER ORDINARY SHARE (CENTS)

15.80 14.20 13.44

10.00 20.00 5.00

TOTAL ASSETS ($000)

SHAREHOLDERS FUND ($000)

438,504 377,743 375,383

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

TOTAL ASSETS OWNED ($ MILLION)

49 25 153 29 258 0 514

29 73 176 28 295 0 601

20 202 192 30 404 11 859

102 98 384 7 397 4 992

209 144 270 7 375 0 1,005

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

TOTAL LIABILITIES AND SHAREHOLDERS FUND ($ MILLION)

378 78 31 114 0 601

439 96 204 120 0 859

375 133 370 114 0 992

479 113 360 53 0 1,005

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

CORPORATE GROUP STRUCTURE

JAYA HOLDINGS LIMITED

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

TANG KOK YEW CHAIRMAN 18 September 2010

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

TANG KOK YEW

CHAN MUN LYE

CHAN FOOK KONG

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

MOK WENG SUN

CHUNG THIAN SIANG

LIM JIEW KENG

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

LIOW KENG TECK

GOON KOK LOON

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

OFFSHORE SHIPPING DIVISION

CORPORATE SERVICES DIVISION

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

Utility supply vessels

Platform supply vessels

Accommodation work barges

Deck cargo barges

JAYA HOLDINGS LIMITED | ANNUAL REPORT 2010

CHARTERING REVENUE BY GEOGRAPHICAL REGION FY2010

CHARTERING REVENUE BY GEOGRAPHICAL REGION FY2009

CHARTERING REVENUE BY CHARTER TYPE FY2010

CHARTERING REVENUE BY CHARTER TYPE FY2009