KENANGA ANNUAL REPORT 2017

DIVIDEND The Board of Directors is recommending a final dividend of 3.0 sen per share, amounting to a total of RM21.68 million, for shareholders’ approval at the forthcoming Annual General Meeting. This will be the highest dividend pay-out the Group has awarded over the last five (5) years. STRATEGIC OBJECTIVES It is encouraging to note the Group’s year-on-year achievements and progress generated through the consistent execution of our growth agenda. Premised on delivering sustainable profitability and shareholder value, our growth agenda has kept us on track. It is underpinned by the strategic objectives listed below: 1. To deliver long-term profitability and sustainable growth 2. To continue redefining clients’ experience through innovation and technology 3. To promote good business ethics and corporate governance 4. To build a high performance culture CORPORATE HIGHLIGHTS New Corporate Office The relocation to the new corporate office, Kenanga Tower at 237, Jalan Tun Razak, Kuala Lumpur was completed in January 2017. Consolidating three (3) of the Company’s offices within Klang Valley into a singular premise has yielded considerable savings. We have benefitted not just from lower overheads and savings of approximately RM7 million a year, but also from the potential capital appreciation of the property in the future. Employee Share Ownership To further align employee interests with those of our shareholders, we rolled-out an Employee Share Scheme (ESS) of up to 10% of the Company’s total share capital. Through this ESS which aims to reward and retain our employees, we are promoting a shared purpose and responsibility to build the Company, and to allow employees to participate in the equity of the Group. The Employee Share Option Scheme was offered to over seven hundred (700) eligible employees, on 2 January 2018. For the financial year ended 31 December 2017, Kenanga Group recorded a Profit Before Tax (PBT) of RM40.62 million, a 25% increase from the same period last year, while Profit After Tax (PAT) increased by 20% to RM24.17 million. The Group registered revenue of RM697.63 million, an increase of almost 20% from the year before. Our higher revenue and profits were largely attributed to higher brokerage income and investment banking fee income. Dear Shareholders, As the Malaysian economy shifted into full gear in 2017, fuelled by the Government’s pro-growth policies and stronger domestic demand, Kenanga Investment Bank Berhad and its Group of Companies (Kenanga Group or the Group) registered an equally positive year driven by our focus on delivering profitability. Kenanga Investment Bank Berhad 12 GROUP MANAGING DIRECTOR’S OVERVIEW