PSE Circular for Brokers No. 1516-98

July 3, 1998 PSE CIRCULAR FOR BROKERS NO. 1516-98 SECURITIES & EXCHANGE COMMISSION SEC FORM 11-C CURRENT REPORT UNDER SECTION 11 OF THE REVISED SECURITIES ACT (RSA) AND RSA RULE 11(a)-a(b)(3) THEREUNDER 1. Date of Report: July 2, 1998 to comply with letter from SEC-MMOD received on June 22, 1998, amendment to 11-C report dated May 25, 1998 and filed May 26, 1998. 2. SEC Identification Number: PW-475 3. BIR TIN No.: 049-000-168-980V 4. Name of Registrant: SIME DARBY PILIPINAS, INC. 5. Incorporated under Philippine law; domicile & principal office: Makati City, MM 6. Industry Classification Code: 7. Address of Principal Office: Sime Darby Building, Ayala Avenue & Malugay St., Makati City, Metro Manila 8. Telephone No. 844 9421; area code: 1255 9. Securities registered pursuant to Sections 4 & 8 of the RSA: Authorized capital stock 50,000,000 shares; par P10.00/share Common shares outstanding 39,062,500 shares; par P10.00/share 10. Report on Item 2 Acquisition of Assets On May 29, 1998, the Registrant acquired 6,882,000 newly issued shares of Lec Refrigeration Plc (or Lec) of Bognor Regis, West Sussex, England. The agreed purchase price was GBP 18 Million or PHP 1.17 Billion and was paid from by internal funds. Lec and the Registrant are subsidiaries of their ultimate parent, Sime Darby Berhad of Kuala Lumpur, Malaysia. Atty. Ricardo J. Romulo, the Chairman of the Board of the Registrant, is a director of the ultimate holding company, Sime Darby Berhad. Mr. Martin S. Berry is a director of the Registrant and of Sime Darby Berhad. Mr. Sean T. O'Kelly, the President and Managing Director of the Registrant was elected director of Lec following the acquisition. cdt The audited financial statements of Lec for the fiscal years 1995-1996 and 1996-1997, are attached. The audited financial statements for fiscal year ended June 1998 will be submitted as soon as these are available. Note that losses were incurred in the past two years due to a fundamental reorganization. Pro-forma financial information of Lec for the fiscal year ended June 1998 will also be submitted as soon as these are available. The impact will not be significant on operations of the Registrant in the current year. Despite the investment, the Registrant continues to have substantial funds available. The company expects to achieve reasonable returns on this investment. Financial statements of the Registrant for the fiscal year ended June 30, 1998 will be submitted as soon as audit of accounts are completed and available. Pursuant to the requirements of the Revised Securities Act, the Registrant has duly caused this report to the signed on its behalf by the undersigned hereunto duly authorized. SIME DARBY PILIPINAS, INC. by: (SGD.) ATTY. RONALD E. JAVIER Vice-President, Corporate & Legal Affairs Price Waterhouse AUDITORS' REPORT TO THE SHAREHOLDERS OF LEC REFRIGERATION PLC We have audited the financial statements on pages 5 to 20 which have been prepared under the historical cost convention and the accounting policies set out on page 9. RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITORS As described above the Company's directors are responsible for the preparation of the financial statements. It is our responsibility to form an independent opinion, based on our audit, on those statements and to report our opinion to you. BASIS OF OPINION We conducted our audit in accordance with Auditing Standards Issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements made by the directors in the preparation of the financial statements and of whether the accounting policies are appropriate to the Company's circumstances, consistently applied and adequately disclosed. cdlex We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularly or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements. OPINION In our opinion the financial statements give a true and fair view of the state of affairs of the Group and the Company at 30 June 1996 and of the loss of the Group for the year then ended and have been properly prepared in accordance with the Companies Act 1985. PRICE WATERHOUSE SOUTHAMPTON Chartered Accountants and Registered Auditors 16 September 1998 LEC REFRIGERATION PLC CONSOLIDATED BALANCE SHEET AT 30 JUNE 1995 1996 1995 Notes 000 000 000 000 FIXED ASSET Tangible assets 6 17,197 9,157 Investments 7 17,197 9,157 CURRENT ASSETS Stocks 8 6,166 10,676 Debtors 9 13,929 10,447 Cash at bank and in hand 5,221 161 25,316 21,284 CURRENT LIABILITIES Creditors: Amounts falling due within one year 10 (11,341) (11,319) NET CURRENT ASSETS 13,975 9,965 TOTAL ASSETS LESS CURRENT LIABILITIES 31,172 19,122 Creditors: Amounts falling due after more than one year 11 (13,660) (1,500) PROVISION FOR LIABILITIES AND CHARGES 12 (834) (752) 16,678 16,870 ===== ===== CAPITAL AND RESERVES Called up share capital 13 1,512 1,512 Profit and loss account 14 15,156 15,358 SHAREHOLDERS' FUNDS 15 16,678 16,870 ===== ===== Approved by the Board and signed on 16 September 1996. P E Cooper K R Cox Director Director LEC REFRIGERATION PLC CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 30 JUNE 1996 12 months ended 30 June 1995 18 months ended 30 June 1995 Notes 000 000 000 000 Turnover 2 57,519 66,714 Change in stocks of finished goods and work in progress (3,724) (389) Own work capitalized 210 43 Other operating income 799 978 54,804 67,346 Raw materials and consumables (34,550) (39,988) Other external and operating charges - normal (5,124) (8,963) - exceptional provision for significant doubtful debt (540) - Staff costs 3 (13,594) (18,176) Depreciation and other amounts written oil tangible fixed assets 6 (931) (598) (54,739) (67,725) Operating profit/(loss) 3 65 (879) Exceptional Items: Cost of a fundamental reorganization 4 (571 - Profit on disposal of fixed assets 13 252 Interest receivable 308 149 Interest payable on bank and other borrowings repayable within 5 years (9) (8) (Loss)/profit before taxation (194) 14 Taxation 5 - 282 (Loss)/profit for the financial year 14,15 (194) 296 Turnover and operating loss are derived exclusively from continuing operations Price Waterhouse AUDITORS' REPORT TO THE SHAREHOLDERS OF LEC REFRIGERATION PLC We have audited the financial statements on pages 6 to 19 which have been prepared under the historical cost convention and the accounting policies set out on page 10. cdt RESPECTIVE RESPONSIBILITIES OF DIRECTORS AND AUDITORS As described on page 3, the Company's directors are responsible for the preparation of the financial statements. It is our responsibility to form an independent opinion, based on our audit, on those statements and to report our opinion to you. BASIS OF OPINION We conducted our audit in accordance with Auditing Standards issued by the Auditing Practices Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosures in the financial statements. It also includes an assessment of the significant estimates and judgements made by the directors in the preparation of the financial statements and of whether the accounting policies are appropriate to the Company's circumstances, consistently applied and adequately disclosed. We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or other irregularly or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements. OPINION In our opinion the financial statements give a true and fair view of the state of affairs of the Group and the Company at 30 June 1997 and of the loss of the Group for the year then ended and have been properly prepared in accordance with the Companies Act 1985. PRICE WATERHOUSE Southampton Chartered Accountants and Registered Auditors 11 September 1997 LEC REFRIGERATION PLC CONSOLIDATED BALANCE SHEET AT 30 JUNE 1995 1997 1996 Notes 000 000 000 000 FIXED ASSET Tangible assets 8 38,037 17,197 CURRENT ASSETS Stocks 10 6,126 6,166 Debtors 11 9,043 13,929 Cash at bank and in hand 5,081 5,221 20,250 25,316 CURRENT LIABILITIES Creditors: Amounts falling due within one year 12 (32,315) (11,341) NET CURRENT (LIABILITIES)/ASSETS (12,065) 13,975 TOTAL ASSETS LESS CURRENT LIABILITIES 25,972 31,172 Creditors: Amounts falling due after more than one year 13 (11,140) (13,660) PROVISION FOR LIABILITIES AND CHARGES 14 (889) (834) 13,943 16,678 ===== ===== CAPITAL AND RESERVES Called up share capital 15 1,512 1,512 Profit and loss account 16 12,431 15,166 SHAREHOLDERS' FUNDS 17 13,943 16,678 ===== ===== Approved by the Board and signed on 11 September 1997. cdt LEC REFRIGERATION PLC CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 30 JUNE 1997 Notes 1997 1996 000 000 TURNOVER 2 51,007 57,519 COST OF SALES (44,699) (52,091) GROSS PROFIT 6,308 5,428 Distribution costs (2,342) (2,510) Administrative expenses - normal (3,629) (3,112) - exceptional provision for significant doubtful debt - (540) Other operating income 680 799 OPERATING PROFIT 3 1,017 65 Cost of fundamental reorganization 4 (3,659) (571) (Loss)/profit on disposal of fixed assets (5) 13 Interest receivable 150 308 Interest payable on bank and other borrowings repayable within 5 years (277) (9) LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (2,775) (194) Tax on loss on ordinary activities 7 - - LOSS ON ORDINARY ACTIVITIES AFTER TAXATION AND LOSS FOR THE FINANCIAL YEAR 16,17 (2,775) (194) ===== ===== Turnover and operating loss are derived exclusively from continuing operations. cdlex