(Incorporated in Malaysia)

Summary of Key Matters Discussed during the 24th Annual General Meeting of Dominant Enterprise Berhad duly convene and held on Monday, 22 August 2016 at 10.00 a.m. at Grand Paragon Hotel, Sapphire 3 Hall, Level 4, No. 18, Jalan Harimau, Taman Century, 80250 Johor Bahru, Johor
1. The following questions were posed by shareholders pertaining to the Audited Financial Statements for the year ended 31 March 2016 (Agenda 1) :
  a) Impairment Loss of Trade Receivables amounting to RM3.6 million
(Page 71 - Note 14 of the Audited Financial Statements for year ended 31 March 2016)

The Board of Directors informed that RM3.4 million out of the RM3.6 million were debts from a customer of Akati Impex Pte. Ltd. (AKATI), the Company’s subsidiary in Singapore. This customer is a public listed company in Singapore which engaged in interior design and had have long term business relationship with AKATI for more than 20 years. Recently, the customer has encounter financial difficulties and had defaulted on payments to AKATI.

The Directors of AKATI had taken appropriate actions and with several discussion and meetings with the debts restructuring manager of the customer, Messrs Deloitte, Singapore on the collection of the said debts. The debts restructuring process was still proceeding and the Management would try the best to collect the debts.

The Board of Directors also informed that the Company has always ensure strict and prudent credit control over the years and continuingly. Provision for Doubtful Debts for financial year 2014 and 2015 is 0.08% and 0.06% respectively. The unexpected defaulted on payment by the abovementioned customer of AKATI has caused such provision increased to 0.67% in financial year 2016. The Company would monitor regularly and closely on this debts and would try the best to recover the said debts.
Short Term Investments amounting to RM35.7 million
(Page 71 - Note 15 of the Audited Financial Statements for year ended 31 March 2016)

The Board of Directors informed that the Company’s cash for sum of RM35.7 million had been placed in two (2) short term investment fund accounts which were managed by the following licensed financial institutions incorporated in Malaysia :
Type of Investment Account  Name of Financial Institution
United Cash Fund United Overseas Bank (Malaysia) Berhad
AmIncome AmBank (M) Berhad

The tax free dividend and exempted interest income provided tax savings to the Company as compared to taxable interest generated from fixed deposits account.
In answer to the query if the tax saving would be able to cover the loss of investment, the Board responded that the investment is low risk and stable fund investment and long term placing of fund into the said account would generate substantial tax savings of approximately RM60,000 per annum and the withdrawals, as and when needed, are more flexible than fixed deposit without affecting the dividend entitled.

In answer to the decline in fair value, Management informed that it was a short term operation expenses incurred at the beginning stage of the investment and adjustment in value would be done at a later stage.

  c) Dividend

A member suggested for more dividend to be distributed to the shareholders. The Board informed that overall dividends paid during the financial year including the final dividend to be paid is 50% of the Profit After Tax of the Company. Based on the current uncertain market condition, the Company has to maintain certain amount of reserve as a contingency plan and for future business opportunities. As for the dividend policy suggested by shareholders, the Board informed that the Management would look into the suggestion.
  d) Operations review and future prospect 
(Page 12 – Chairman’s Statement)

In financial year 2016, the Company’s distribution segment had contributed 80.1% of the total Group’s revenue. However, the operating profit from this segment had declined 42.2% from RM28.9 million in financial year 2015 to RM16.7 million in financial year 2016. The reduction was due to the following :

(1)    RM4.3 million gain on disposal of property in prior year ;
(2)    RM3.5 million of Provision of Doubtful Debts ;
(3)    the weakening of MYR versus USD as a substantial portion of the Group’s purchases are denominated is USD that were reflected in FY 2016

Manufacturing division has better profit margin in the financial year 2016 mainly due to the market share expansion in existing markets.

The new warehouse and factory at Butterworth targeted to complete by end of the year 2016 and would be able to increase the capacity and storage of the Company’s products and with better services to customers in Northern area of Malaysia and Southern area of Thailand.

The revenue from export market contributed 17.4% of the total revenue. In financial year 2016, the revenue increased 11.3% and the Company has targeted an increase of 20% in the next financial year.
  e) Share Price

A Shareholder enquired the reasons for the stagnant share price of the Company. The Board informed that the share price of the Company depends very much on the public investor’s judgement and decision and is beyond the control of the Company.
For Agenda 2 to 10, there was no question being raised by the shareholders at the meeting.