Proton Annual Report 2010

PROTON 2010 ANNUAL REPORT
CONTENTS PROTON ANNUAL REPOR

PROTON Holdings Berhad (623
02 Corporate Mantra & Core Values
04 PROTON’s Policies
08 Financial Calendar
09 Key Financial Indicators
10 Summary of Financial Highlights

for Five Years
14 Corporate Profile
18 Corporate Information
20 Group Operations
Chairman’s
Statement 40 Managing
Director’s 48 Operations
Review 54
Review
24 Board of Directors 166 Risk Management
26 Profile of Directors 170 Calendar of Events 2009 – 2010
34 PROTON Group Management 180 Statutory Financial Statements

Committee Members
287 Shareholding Statistics
36 Heads of International Subsidiaries
290 Properties Owned by PROTON Group
40 Chairman’s Statement
295 Share Price and Volume Traded
48 Managing Director’s Review
296 Notice of 7th Annual
54 Operations Review General Meeting
140 Statement on Corporate Governance 299 Statement Accompanying the

Notice of 7th Annual General
158 Additional Compliance Information Meeting
162 Statement on Internal Control Form of Proxy
Corporate Mantra & Core Values
PROTON 2010 Annual Report
THE PROTON WAY

2
25 STERLING YEARS
PROTON EMPLOYEES ARE DEDICATED TO THE GROUP’S

LONG-TERM SUCCESS. EVERY PROTON EMPLOYEE SHALL
OPERATE UNDER THE GROUP’S SHARED VALUES AND RELY
ON THESE VALUES TO GUIDE THEIR BEHAVIOUR WITH EACH
OTHER AND THE CUSTOMERS. THESE VALUES FORM THE

FOUNDATION OF HOW WE WORK AND CONDUCT BUSINESS.
Corporate Mantra & Core Values

Core Ideology 3
Audacious Goal Purpose
25 STERLING YEARS
Driving Malaysia’s transformation into a leader in We are a passionate group of people working
technology and quality. together, creating exhilarating products and
services for global markets, synonymous with great
Vivid Description styling, innovation and leading technology.
We deliver innovative and superior quality products
and services. Our brands inspire confidence and
pride.
Core Values
Quality Teamwork
We make products that work the first time, every We trust, respect and share knowledge to foster
time. teamwork at the workplace.
Customer Focus Speed

Customers are the source of our income. We deliver We have a “can-do” attitude and will not rest until
on our promises to our customers’ satisfaction. the problem is solved. We have an inherent sense
of urgency in everything we do.
Innovation
We challenge convention, always seeking new and Caring
better ways of doing things. We view change as As a responsible corporate citizen, we invest in
opportunity. safety, health and the environment.
PROTON’s Policies
ENVIRONMENTAL,
HEALTH AND SAFETY POLICY
THE COMPANY’S MISSION IS TO The Group is committed to providing a conducive,
4 safe and healthy working environment for our
STRIVE TOWARDS EXCELLENCE employees and to ensure this, it is our policy to:-
IN ALL ASPECTS OF PROTON’S • Take responsibility for the safety and health of
25 STERLING YEARS
OPERATIONS. IN ACHIEVING our employees;
OUR GOAL, IT IS NECESSARY TO • Provide the appropriate resources;
PROMOTE AND PROTECT THE • Take all action necessary to remedy any non-
compliance;
HEALTH AND SAFETY OF PROTON
• Monitor and maintain high standards in
EMPLOYEES AND ENSURE environmental protection as well as health and
THAT THE ENVIRONMENT IS safety measures.
UNHARMED.
Environment, health and safety are our priority.
QUALITY POLICY
TO ACHIEVE OUR COMMITMENT
TO QUALITY, PROTON WILL:-
PROTON’s Policies

In implementing the Company’s policy, we shall, To assist the Company in achieving our goals, we
where reasonably practicable:- shall work together and towards this end, employees 5
shall:-
• Comply with all rules and regulations concerning
the environment, health and safety; • Abide by all rules and regulations concerning
25 STERLING YEARS
the workplace;
• Provide all the necessary facilities and
equipment for the employees; • Utilise all the facilities provided by the
management in a safe and proper manner;
• Actively promote programmes for the employees
to instill awareness for the safety and health of • Maintain good work practices;
the employees, our business associates and the
• Actively participate in all the Environmental,
public;
Health and Safety (EHS) programmes.
• Provide adequate information and assistance
This is our objective and it is our intention to put
to our employees and our neighbours to avoid
this EHS Policy into action and to make it our way
unacceptable effects on the environment.
of life.
• Ensure quality as the Number One work ethics • Provide a culture and environment of continuous
in all operations; learning, improvement and innovation towards
total quality excellence;
• Establish an effective and efficient Quality
System based on the requirements of ISO • Provide a conducive, safe and healthy working
9001:2008 standards; environment in which people like to work and
prosper.
• Provide adequate skills and knowledge to all
levels of personnel through systematic and
structured training programmes;
In the areas of technology, design, quality and marketing,
PROTON has come a long way by riding on creative strategies and
partnering the world’s best. We are now in full gear optimising
operations to accelerate improved levels of expertise.
We are a global automotive player.
A New Dawn in Expertise

Financial Calendar
2009
8 JUL AUG NOV
30 21 23
25 STERLING YEARS
1st QUARTER 2nd QUARTER

Financial Results 6 Annual
th
Financial Results
for period ended General Meeting for period ended
30 June 2009 30 September 2009
2010
FEB MAY JUL JUL

19 26 30 30
Declaration of proposed
3rd QUARTER 4th QUARTER Audited Financial First & Final Dividend of
Financial Results Financial Results Statement for 20 sen per share
for period ended for period ended Financial Year ended (less 25% tax)
31 December 2009 31 March 2010 31 March 2010 for Financial Year
ended 31 March 2010
AUG SEP SEP OCT

30 23 30 22
Entitlement Date for Payment of First &
Notice of 7th Annual 7th Annual First & Final Dividend Final Dividend of
General Meeting General Meeting of 20 sen 20 sen (less 25% tax)
(less 25% tax)
Key Financial Indicators

Basic Earnings/(loss) Per Share Net Assets Per Share
(Sen) (RM)
8.5 (107.3) 33.6 (54.9) 39.9 10.7 9.5 9.9 9.3 9.7
9
25 STERLING YEARS
06 07 08 09 10 06 07 08 09 10
Dividend Paid Retained Earnings

(RM’ million) Carried Forward (RM’ million)
54.9 27.5 - 20.6 - 4,908.7 4,291.7 4,476.2 4,153.9 4,372.8
06 07 08 09 10 06 07 08 09 10
Summary of Financial Highlights for Five Years
BALANCE SHEETS AS AT 31 MARCH
RM’ million 2010 2009 2008 2007 2006
10 NON-CURRENT ASSETS
Property, plant and equipment 2,624.4 2,827.1 3,150.4 3,169.5 3,302.9

25 STERLING YEARS
Prepaid land lease payments - - 24.1 9.9 10.0

Goodwill 29.0 29.0 29.0 29.0 29.0
Intangibles assets 564.0 431.7 275.2 169.1 18.0
Associated companies 152.6 158.4 165.4 169.8 160.4
Jointly controlled entities 202.6 195.6 192.7 223.6 245.3
Investments - 10.4 10.4 10.4 10.4
Deferred tax assets 15.0 5.7 - - 105.8
3,587.6 3,657.9 3,847.2 3,781.3 3,881.8
CURRENT ASSETS
Inventories 1,227.2 1,395.1 1,100.3 1,273.6 1,389.0

Receivables 991.6 1,080.3 1,099.0 1,192.0 1,244.0
Current investments 9.7 15.3 20.8 73.4 212.0
Deposits, bank and cash balances 1,652.1 913.9 1,226.0 626.5 1,586.0
3,880.6 3,404.6 3,446.1 3,165.5 4,431.0
Non-current assets held for sale 36.9 36.4 - - -
TOTAL ASSETS 7,505.1 7,098.9 7,293.3 6,946.8 8,312.8

RM’ million 2010 2009 2008 2007 2006
CAPITAL AND RESERVES

11
Share capital 549.2 549.2 549.2 549.2 549.2
25 STERLING YEARS
Other reserves 411.0 398.5 395.8 389.7 412.7
Retained earnings 4,372.8 4,153.9 4,476.2 4,291.7 4,908.7
Equity attributable to equity
holders of the Company 5,333.0 5,101.6 5,421.2 5,230.6 5,870.6
Minority interest - - - - -
TOTAL EQUITY 5,333.0 5,101.6 5,421.2 5,230.6 5,870.6
NON-CURRENT LIABILITIES
Long term liabilities 88.6 101.5 230.5 181.6 100.3

Deferred tax liabilities 10.8 12.2 2.4 0.8 0.8
99.4 113.7 232.9 182.4 101.1
CURRENT LIABILITIES
Payables 2,060.6 1,877.3 1,637.6 1,531.6 2,324.2

Taxation 12.1 6.3 1.6 2.2 16.9
2,072.7 1,883.6 1,639.2 1,533.8 2,341.1
TOTAL LIABILITIES 2,172.1 1,997.3 1,872.1 1,716.2 2,442.2
TOTAL EQUITY AND LIABILITIES 7,505.1 7,098.9 7,293.3 6,946.8 8,312.8
INCOME STATEMENT
FOR THE YEAR ENDED 31 MARCH
RM’ million 2010 2009 2008 2007 2006

12
Revenue 8,226.9 6,518.7 5,621.6 4,687.3 7,796.9
25 STERLING YEARS
Profit/(loss) before taxation 260.9 (319.2) 144.3 (618.1) 18.0

Profit/(loss) after taxation 218.9 (301.8) 184.6 (589.5) 46.7
Retained earnings attributable
to shareholders 4,372.8 4,174.5 4,476.2 4,319.2 4,963.6
Dividend paid - (20.6) - (27.5) (54.9)
Retained earnings carried forward 4,372.8 4,153.9 4,476.2 4,291.7 4,908.7
SHARE INFORMATION
Per share
Basic earnings/(loss) (sen) 39.9 (54.9) 33.6 (107.3) 8 .5

Dividend paid (sen) - 5.0 - 5.0 10.0
Net assets (RM) 9.71 9.29 9.87 9.52 10.69
Issued share capital (‘000) 549,213 549,213 549,213 549,213 549,213
Corporate Profile
Corporate Profile

SINCE INCORPORATION ON 7 MAY 1983, PROTON REMAINS AMONG
ALL NATIONAL CAR COMPANIES, THE LARGEST CONTRIBUTOR
TOWARDS THE THREE PRIMARY NATIONAL POLICY OBJECTIVES:
• To spearhead the automotive industrialisation process and manufacturing industries;

• To acquire/upgrade technology and industrial skills within the automotive manufacturing 15
industry; and
25 STERLING YEARS
• To strengthen the international competitiveness of Malaysia’s industrial capability
With substantial capital investment over the last 25 years and the
corporate philosophy that success can be achieved by having ‘the
right car for the right market, at the right price and at the right
time’, PROTON commands a substantial share of the domestic
market for passenger cars and through the years, has expanded its
international footprint in the following regions:
• ASEAN • United Kingdom – Western Europe
• China • Australia
• Indian Subcontinent • South Africa
• Middle East – North Africa
PROTON’s main business activities encompass vehicle engineering,

research and development, manufacturing, distribution, sales and
after-sales services. The Group is also involved in financial services
and property management as supporting activities.
Corporate Profile
The foundation of the Group’s growth over the last 25 years is due to the understanding of the economic
development stimulus, diverse customer needs and the abilility to translate them into products that customers
want, through research and development.
The current portfolio of PROTON models includes the Saga, which was named Best Model of the Year
16 for two consecutive years 2009 and 2010; the Persona, winner of the 2008 ASEAN Automotive Award
for Best Model of the Year; the reliable family-sedan, Waja; the stylish and ergonomic Gen.2; the fun-to-
drive Savvy; the desirable sporty Satria Neo; elegant Perdana and Malaysia’s first home-grown multipurpose
vehicle (MPV), the Exora, which marked PROTON’s entry into the MPV market – a market that is growing
25 STERLING YEARS
domestically and regionally.

Also in the Group’s portfolio, is the world-renowned Lotus sportscar brand, with models such as Elise,
Exige, Europa and the Evora, the latest supercar that remains true to Lotus’ heritage and core philosophies
of being Visually Stunning, Exhilarating, Agile and Responsive, to suit a range of customer demands and
preferences.
In 2009, PROTON clinched two awards by Frost & Sullivan:

• Best Passenger Car Model of the Year for the Proton Saga; and
• Best Automotive Debut Model of the Year for the Proton Exora.
These awards recognise PROTON’s commitment to continuously offer products that are customer-centric in
terms of specifications and pricing.
Other awards for the year include:
• Asian Auto-VCA Auto Industry Awards 2009 for Best Local Assembly MPV for Exora, and
• Asian Auto-VCA Auto Industry Awards 2009 for Best Local Assembly Sports Car for Satria Neo CPS.
Corporate Profile

The Group conducts research in its centres in Malaysia and the United Kingdom on new technologies to
create cars that are unique in both design and driving performance. Through Lotus, the Group provides
comprehensive and versatile consultancy services to many of the world’s OEMs and Tier 1 suppliers. Today,
Group Lotus is organised into two business divisions. Lotus Cars focuses on sales of world-class, prestigious,
high-performance sports cars, whilst Lotus Engineering provides engineering solutions for automotive
manufacturers and suppliers. 17
To boost the quality of its products, PROTON has introduced a Company-wide quality improvement programme
and quality-conscious work culture that assures:
25 STERLING YEARS
• Quality in everything (products and individuals);
• Quality in the way things are done (doing it right the first time);
• Quality in spending, including reducing materials costs;
• High-quality products (end products must be of the right technology and designed to meet market
expectations); and
• Quality services to customers, including after-sales support.
At present, the Group has close to 12,000 employees who are involved in the whole value chain of the
business from research, design, development, testing, stamping, casting, machining and assembly to
marketing, distribution, after-sales services, as well as corporate services.
Strong customer orientation and competitively priced products drive our business and are essential to our
success. We aim to maintain market leadership by continuing to develop innovative products and satisfying
our customers; thereby enhancing profitability.
Corporate Information
BOARD OF DIRECTORS
Dato’ Sri Mohd Nadzmi Bin Mohd Salleh – Chairman
Dato’ Haji Syed Zainal Abidin B Syed Mohamed Tahir
Dato’ Michael Lim Heen Peok
Dato’ Zalekha Binti Hassan
Mr. Behara Venkata Rama Subbu
Tan Sri Rainer Althoff

18 Encik Abdul Rahim Bin Abdul Hamid
Tuan Haji Abdul Jabbar Bin Abdul Majid

25 STERLING YEARS
Tuan Haji Abdul Kadir Bin Md Kassim
Mr. Oh Kim Sun
COMMITTEES
BOARD EXECUTIVE COMMITTEE (“EXCO”) BOARD NOMINATION & REMUNERATION COMMITTEE
(The Board Executive Committee was subsequently • Dato’ Sri Mohd Nadzmi Bin Mohd Salleh – Chairman
disbanded w.e.f. 1 Aug 2010) • Encik Ahmad Tajuddin Bin Abdul Carrim
• Dato’ Sri Mohd Nadzmi Bin Mohd Salleh – Chairman • Dato’ Michael Lim Heen Peok
• Dato’ Haji Syed Zainal Abidin B Syed • Dato’ Zalekha Binti Hassan
Mohamed Tahir (Appointed w.e.f. 1 August 2010)
• Dato’ Michael Lim Heen Peok • Encik Md. Ali Bin Md. Dewal
• Encik Azhar Bin Othman (Resigned w.e.f. 27 May 2010)
(Appointed w.e.f. 22 July 2009)
• Ms Vimala Menon BOARD RISK MANAGEMENT COMMITTEE
(Resigned w.e.f. 31 August 2009) (The Board Risk Management Committee was
subsequently disbanded w.e.f. 1 Aug 2010)
BOARD AUDIT COMMITTEE • Datuk Tan Kim Leong
• Encik Abdul Rahim Bin Abdul Hamid – Chairman • Dato’ Zainuddin Bin Che Din
(Appointed w.e.f. 20 July 2010)
• Tuan Haji Abdul Kadir Bin Md. Kassim
• Dato’ Michael Lim Heen Peok (Resigned w.e.f. 27 May 2010)
• Dato’ Zalekha Binti Hassan
(Appointed w.e.f. 27 May 2010) BOARD DISCIPLINARY COMMITTEE
• Tan Sri Rainer Althoff (The Board Disciplinary Committee was subsequently
(Appointed w.e.f. 20 July 2010) disbanded w.e.f. 1 Aug 2010)
• Encik Abdul Jabbar Bin Abdul Majid • Dato’ Sri Mohd Nadzmi Bin Mohd Salleh – Chairman
(Resigned w.e.f. 21 August 2009) • Tuan Haji Yusof Bin Ahmad
• Mr. Oh Kim Sun • Tuan Haji Abdul Kadir Bin Md. Kassim
(Resigned w.e.f. 27 May 2010) (Resigned w.e.f. 27 May 2010)
• Tuan Haji Abdul Kadir Bin Md. Kassim • Encik Md. Ali Bin Md. Dewal
(Resigned w.e.f. 27 May 2010) (Resigned w.e.f. 27 May 2010)
• Mr. Behara Venkata Rama Subbu
(Resigned w.e.f. 20 July 2010)
Corporate Information
DATE OF APPOINTMENT
1 January 2009

1 January 2006
15 September 2006
11 February 2008
1 March 2010
22 June 2010
20 July 2010 19
12 April 2004 (Resigned w.e.f. 21 August 2009)
25 STERLING YEARS
10 March 2005 (Resigned w.e.f. 27 May 2010)
13 May 2009 (Resigned w.e.f. 27 May 2010)
AUDITORS REGISTRAR
PRICEWATERHOUSECOOPERS TRICOR INVESTOR SERVICES SDN. BHD.
(Chartered Accountants) (formerly known as Tenaga Koperat Sdn. Bhd.)
Level 10, 1 Sentral, Jalan Travers Level 17, The Gardens, North Tower,
Kuala Lumpur Sentral, PO Box 10192 Midvalley City, Lingkaran Syed Putra
50706 Kuala Lumpur, Malaysia 59200 Kuala Lumpur
Tel : 03 - 2173 1188 Tel : 03 - 2264 3883
Fax : 03 - 2173 1288 Fax : 03 - 2282 1886
REGISTERED OFFICE STOCK EXCHANGE LISTING

PROTON CENTRE OF EXCELLENCE Main Market of Bursa Malaysia Securities Berhad
KM 33.8, Westbound Shah Alam Expressway
47600 Subang Jaya, Selangor Darul Ehsan COMPANY SECRETARY
Tel : 03 - 8026 9741 Encik Mohd Nizamuddin Bin Mokhtar (LS 006128)
Fax : 03 - 8026 9744
INVESTOR RELATIONS
MAIN BANKERS
Encik Izwan Bin Zainuddin
Malayan Banking Berhad Tel : 03 - 8026 9094
CIMB Bank Berhad
RHB Bank Bhd
Group Operations
PROTON ANNUAL REPORT 2010

PROTON Holdings Berhad
PROTON Holdings Berhad (623177-A)
20 Manufacturing Engineering Services

100% Perusahaan Otomobil 100% Lotus Advance Technologies
25 STERLING YEARS
Nasional Sdn. Bhd. Sdn. Bhd.

100% Proton Tanjung Malim 100% Proton Engineering Research
Sdn. Bhd. Technology Sdn. Bhd.
100% PT Proton Cikarang Motors 100% Lotus Group International
(Indonesia) Limited (UK)
100% Proton Automobiles China 100% Group Lotus Plc (UK)
Ltd (BVI)
100% Lotus Engineering Ltd (UK)
100% Lotus Cars Ltd (UK)
100% Lotus Engineering (Shanghai)
100% Lotus Lightweight Structures Co Ltd (China)
Holdings Limited (UK)
100% Lotus Engineering (M) Sdn. Bhd.
100% Lotus Lightweight Structures
100% Lotus Body Engineering Ltd (UK)
Limited (UK)
100% Lotus Motorsport Ltd (UK)
51% Miyazu (Malaysia) Sdn. Bhd.
100% Lotus Holdings Inc (USA)
49% Goldstar Proton Automobiles
Co Ltd (China) 100% Lotus Engineering Inc (USA)
Group Operations

Sales & Distribution Investee & Associate Companies
21
100% Proton Marketing Sdn. Bhd. 45% Exedy (Malaysia) Sdn. Bhd.
25 STERLING YEARS
100% Proton Edar Sdn. Bhd. 40% Netstar Advanced Systems
Sdn. Bhd.
100% Proton Cars (UK) Ltd
35% PHN Industry Sdn. Bhd.
100% Proton Cars Australia Pty Limited
25% Marutech Elastomer Industries
100% Proton Motors (Thailand) Limited
Sdn. Bhd.
100% Proton Singapore Pte Ltd
25% Vina Star Motors (Vietnam)
100% PT Proton Edar Indonesia Corporation
100% Lotus Cars Australia Pty Limited 16% Aluminium Alloy Industries
Sdn. Bhd.
100% Lotus Cars USA Inc
15% Technomeiji Rubber Sdn. Bhd.
55% Proton Parts Centre Sdn. Bhd.
6.7% Ara Borgstena Sdn. Bhd.
4.2% Peps-JV Sdn. Bhd.
Property
100% Proton Hartanah Sdn. Bhd.
100% Proton Properties Sdn. Bhd.
Others
40% Proton City Development
Corporation Sdn. Bhd. Yayasan Proton
Lotus Pension Trustees Ltd (UK)
Financial Services Lotus Cars Foundation (UK)
50% Proton Commerce Sdn. Bhd.

49.9% Lotus Finance Ltd (UK)
49.9% Proton Finance Ltd (UK)
Despite the current challenges faced by the automotive industry
PROTON continues to grow by delivering “The Right Car for the
Right Market, at the Right Price and at the Right Time”. As green
trends emerge, we are now working towards the development of
an efficient hybrid electric vehicle.
We are highly customer oriented.
A New Dawn in Service

BOARD OF DIRECTORS
24
25 STERLING YEARS
Sitting
Dato’ Haji Syed Zainal Abidin B Syed Mohamed Tahir
Standing (left to right)

Dato’ Michael Lim Heen Peok Dato’ Zalekha Binti Hassan
25
25 STERLING YEARS
Sitting
Dato’ Sri Mohd Nadzmi Bin Mohd Salleh
Standing (left to right)

Mr. Behara Venkata Rama Subbu Tan Sri Rainer Althoff Encik Abdul Rahim Bin Abdul Hamid
25 STERLING YEARS PROTON 2010 Annual Report
26
Profile of Directors

27
DATO’ SRI MOHD NADZMI MOHD SALLEH
25 STERLING YEARS
Chairman | Aged 56, Malaysian
Dato’ Sri Mohd Nadzmi Mohd Salleh was appointed Chairman of PROTON on
1 January 2009 and is also the Chairman of the Boards of various subsidiaries within
the PROTON Group of Companies.
Dato’ Sri Mohd Nadzmi graduated with a Bachelor of Arts in Economics from Ohio
University, United States of America, and also holds a Bachelor of Science in Chemistry
and Mathematics from the same university. He subsequently obtained a Masters of
Arts in Economics and Statistics from Miami University, USA.
Dato’ Sri Mohd Nadzmi began his career as a lecturer in the Faculty of Economic
Resources and Agriculture in Universiti Pertanian Malaysia. Thereafter he held various
executive positions in Petroleum Nasional Berhad and Heavy Industries Corporation
Malaysia Berhad. He then left to join Edaran Otomobil Nasional Berhad as Manager
in the Marketing Services Department in 1984, and later assumed the positions
of Executive Director and Chief Executive Officer. In 1993 Dato’ Sri Nadzmi was
appointed Managing Director of Perusahaan Otomobil Nasional Berhad, a post he
held until 1996.
Dato’ Sri Mohd Nadzmi is also currently the Executive Chairman of Nadicorp Holdings
Sdn. Bhd. and Express Rail Link Sdn. Bhd.. He also sits on the Boards of, J.T.
International Berhad, V.S. Industry Berhad, Konsortium Transnasional Berhad and
Transocean Berhad as well as several private limited companies. He is also the
President of the Badminton Association of Malaysia.
Dato’ Sri Mohd Nadzmi has attended all Board of Directors’ Meetings held during the
Financial Year. He has no conflict of interest with the Company and does not have any
family relationships with any Director and/or major shareholder of the Company. He
has had no conviction for any offences within the past ten (10) years.
DATO’ SYED ZAINAL ABIDIN

B SYED MOHAMED TAHIR
Managing Director | Aged 48, Malaysian
28
Dato’ Haji Syed Zainal Abidin B Syed Mohamed Tahir was
25 STERLING YEARS
appointed Managing Director of PROTON on 1 January 2006.

He also sits on the Boards of various subsidiaries within the
PROTON Group of companies.
Dato’ Haji Syed Zainal Abidin graduated with a Bachelor of

Science in Engineering from the University of Maryland, USA
and began his career as a Project Engineer with Petronas
Gas Sdn. Bhd. in 1987, prior to joining Petroliam Nasional
Berhad in 1992 as the Senior Executive of Corporate Planning
& International Business Development. He then left to join
HICOM Holdings Berhad in 1995, where he assumed various
senior positions in the company.
Dato’ Haji Syed Zainal Abidin was appointed as Senior

General Manager of PERODUA in 1999. Subsequently, he was
appointed Executive Director of PERODUA Auto Corporation
Sdn. Bhd. in 2002, and in October 2005, promoted to Deputy
Managing Director.
In November 2008, Dato’ Haji Syed Zainal Abidin was

named the “Automotive Man of the Year” by the New Straits
Times/Maybank Car of the Year 2008 Awards for his strong
management and leadership qualities in steering PROTON
by strengthening its position in the domestic market while
making significant breakthrough in the international markets.
Most recently, Dato’ Haji Syed Zainal Abidin received the
International Business Leader in Automotive Sector Award at
the 2010 Middle East Business Leadership Summit Awards,
and the Masterclass Bumiputra CEO of the Year Award at the
2nd Malaysia Business Leadership Awards 2010.
Dato’ Haji Syed Zainal Abidin has attended all Board of

Directors’ Meetings held during the Financial Year. He has
no conflict of interest with the Company and does not have
any family relationships with any Director and/or major
shareholder of the Company. He has had no conviction for
any offences within the past ten (10) years.

29
DATO’ MICHAEL LIM HEEN PEOK
Independent Non-Executive Director | Aged 62,
25 STERLING YEARS
Malaysian
Dato’ Michael Lim was appointed a Director of PROTON

on 15 September 2006 and is also a Member of the
Board Audit Committee and Board Nomination &
Remuneration Committee. Dato’ Michael Lim also sits
on the Boards of various companies within the PROTON
Group.
Dato’ Michael Lim who holds a First Class Honours Degree

in Engineering from the University of Strathclyde, in the
United Kingdom, began his career with the UMW Group
in 1975 and held various senior managerial positions. In
1986 Dato’ Michael Lim was appointed Managing Director/
Chief Executive Officer of UMW Toyota Motor Sdn. Bhd.,
a joint venture company between UMW and Toyota Motor
Corporation of Japan. Dato’ Michael Lim retired in 2004
having led the company for 18 years.
Currently, Dato’ Michael Lim is the Chairman of Furniweb

Industrial Products Bhd, an export oriented manufacturing
company with plants in Malaysia and Vietnam.
Dato’ Michael Lim has attended all the Board of

Directors’ meetings held during the Financial Year. He
has no conflict of interest with the Company and has no
family relationships with any other Director and/or major
shareholder of the Company. He has had no conviction for
any offences within the past ten (10) years.
DATO’ ZALEKHA BINTI HASSAN

Non-Independent Non-Executive Director | Aged 57,
Malaysian
Dato’ Zalekha, who was appointed a Director of PROTON on

30 11 February 2008, is also a Member of PROTON’s Board
Audit Committee and Board Nomination & Remuneration
Committee. Dato’ Zalekha sits on the Board of Governors
25 STERLING YEARS
of Yayasan PROTON as well.
Dato’ Zalekha who is currently the Deputy Secretary

General of Management at the Ministry of Finance, holds a
Bachelor of Arts (Hons) Degree from University of Malaya.
Dato’ Zalekha was previously with Tenaga Nasional

Berhad, Putrajaya Holdings and Multimedia Development
Corporation (“MDEC”)
Dato’ Zalekha sits on the Board of Directors of Telekom

Malaysia Berhad, and Perbadanan Kemajuan Negeri
Selangor (“PKNS”).
Dato’ Zalekha has attended all Board Meetings held during

the Financial Year. She has no conflict of interest with the
Company and has no family relationships with any other
Director and/or major shareholder of the Company. She
has had no conviction for any offences within the past ten
(10) years.

MR. BEHARA VENKATA RAMA SUBBU
Indian National
Mr. B.V.R. Subbu was appointed a Director of PROTON 31

on 1 March 2010.
Mr. Subbu holds a Masters in Economics from the
25 STERLING YEARS
Jawaharlal Nehru University, New Delhi, India. He
began his career with the Tata Administrative Service
and was deputed to Tata Motors where he held a
variety of senior line and staff responsibilities in the
areas of CV Marketing, Sales, Service, Spare Parts
and Sales Finance between 1978 and 1996.
In 1997, Mr. Subbu moved to Hyundai Motor, India

as Director of Marketing & Sales and thereafter
promoted to President in 2002, a position he held
until 2006.
Mr. Subbu is currently the Director of NMC

Automotive Infrastructure Pvt. Ltd, a company
engaged in establishing a CV manufacturing project
in India. He is also promoter of various companies
including Pan India Motors, Altius Autoworld and
Altius Advanced Technologies.
No Board Meetings were held from the time

Mr. Subbu was appointed as Director of PROTON
up until the end of the financial year. He has no
conflict of interest with the Company and has no
family relationships with any other Director and/
or major shareholder of the Company. He has had
no conviction for any offences within the past
ten (10) years.
32
TAN SRI RAINER ALTHOFF
25 STERLING YEARS

German National
Tan Sri Rainer Althoff who was appointed Director of

PROTON on 22 June 2010, is also a Member of the
Board Audit Committee, and sits on the boards of various
companies within the PROTON Group.
Tan Sri Rainer holds a Masters in Electronics and Electrical

Engineering from Bergische University Wuppertal, Germany
in 1969 and has spent a majority of his working life with
Siemens AG. Tan Sri Rainer was the President and Chief
Executive Officer of Siemens Malaysia Sdn. Bhd. and also
the Siemens spokesperson for all Siemens operations and
affiliate companies in Malaysia from 1 January 1999 until
30 November 2009.
Tan Sri Rainer is currently the Non-Executive Chairman of

Nokia Siemens Networks Sdn. Bhd. He is also a Member
of the International Advisory Panel to the board of directors
of CIMB Bank, Trustee of Jeffrey Chia Foundation Malaysia
and Managing Director of Jatro AG, Singapore.
Tan Sri Rainer was appointed in June 2010 and therefore

has not attended any Board meetings held during the
Financial Year ended 31 March 2010. He has no conflict of
interest with the Company and has no family relationships
with any other Director and/or major shareholder of the
Company. He has never been convicted for any offence
within the past ten (10) years.

ENCIK ABDUL RAHIM BIN ABDUL HAMID
33
Malaysian
25 STERLING YEARS
Encik Abdul Rahim Bin Abdul Hamid was appointed
Independent Non-Executive Director of PROTON on
20 July 2010. He was also appointed Chairman of the
Board Audit Committee effective the same date.
Encik Abdul Rahim who is a Qualified Certified Accountant

began his career in Coopers & Lybrand in 1971 and
became the Managing Partner/Chief Executive of the firm
in 1993. In 1998, he assumed the position of Deputy
Executive Chairman of PricewaterhouseCoopers until his
retirement in 2004.
Encik Abdul Rahim is currently the President of the

Malaysian Institute of Accountants as well as the ASEAN
Federation of Accountants.
Encik Abdul Rahim is a director of Chemical Company

of Malaysia Berhad, MIDF Amanah Asset Management
Berhad and Petra Energy Berhad. He represents the
Ministry of Finance on the board of MIMOS Berhad.
Encik Abdul Rahim was appointed in July 2010 and

therefore has not attended any Board meetings held
during the Financial Year ended 31 March 2010. He
has no conflict of interest with the Company and has no
family relationships with any other Director and/or major
shareholder of the Company. He has never been convicted
for any offence within the past ten (10) years.
PROTON GROUP MANAGEMENT COMMITTEE MEMBERS
(left to right)
Klaus E. Liske Azmi Bin Idris Muhammad Tajul Zahari Michele Kythe Azhar Bin Othman Dato’ Haji Syed
Aris Bin Anuar Bin Abu Bakar Lim Beng Sze Zainal Abidin B
Syed Mohamed Tahir
Director, Director, General Manager, Director, Chief Chief Managing Director
Group Procurement Group Quality Manufacturing Engineering Legal Counsel Financial Officer
34
25 STERLING YEARS
Dr. Wolfgang Mohd Nizamuddin Yohani Binti Mohamad Shukor Claudius Meynert Dr. Badrulhisham
Karl Epple Bin Mokhtar Mohd Yusof Bin Ibrahim Bin Mohd Ghazali
Senior Director, Group Company Director, Chief Executive Officer, Director, General Manager,
Group Operations Secretary Group Marketing Proton Edar Sdn. Bhd. Export Corporate Planning
& Compliance & After Sales
35
25 STERLING YEARS
HEADS OF
INTERNATIONAL
SUBSIDIARIES
36
25 STERLING YEARS
1 2 3
Brian Collier John Startari Dany Taner Bahar

Managing Director, Managing Director, Chief Executive Officer,
Proton Cars (UK) Ltd Proton Cars Australia Group Lotus Plc
Pty Limited
4 5 6
Ricky Too Heng Keong Gunther Scherz Philipe Cheng

President Director, Acting Managing Operations Manager,
PT Proton Edar Director, Proton Motors
Indonesia Proton Singapore (Thailand)
Pte Ltd Co. Ltd.
5
2
6
3
Heads of International Subsidiaries

37
25 STERLING YEARS
PROTON’s entry into F1 marks the growth of our repute as a
leader in the global automotive industry. Leveraging on our
established R&D capabilities with LOTUS, we are working to
develop enhanced racing engine technology.
We now perform on the world arena.
A New Dawn in Performance

CHAIRMAN’S
STATEMENT
IT HAS BEEN A GOOD FINANCIAL

YEAR AND MORE IMPORTANTLY,
40
AS WE CELEBRATE OUR SILVER
JUBILEE, IT HAS BEEN A
25 STERLING YEARS
THOROUGHLY CHALLENGING,
HUMBLING AND EXHILARATING
25 YEARS FOR PROTON AND
IN MY PERSONAL OPINION,
DESPITE THE PEAKS AND
TROUGHS, WE ARE NOW IN A
BETTER POSITION THAN EVER
TO FORTIFY OUR POSITION AS
A TRUE AUTOMOTIVE ORIGINAL
EQUIPMENT MANUFACTURER
(OEM) WITH CLEAR AND
REALISTIC ASPIRATIONS.
ON BEHALF OF THE BOARD OF

DIRECTORS OF THE COMPANY,
I AM PLEASED TO PRESENT THE
ANNUAL REPORT AND AUDITED
FINANCIAL STATEMENTS OF
THE PROTON GROUP FOR THE
FINANCIAL YEAR 2009/10
(FY09/10).
Chairman’s Statement

INDUSTRY OVERVIEW
The aftermath of the global economic crisis continued to batter
the global automotive industry, especially in the United States,
where we saw several iconic brands reduced to mere chapters in
the annals of automobile history. Although not as dramatic, the
Malaysian automotive industry suffered a worryingly lacklustre
start to 2009. Thanks to the immediate and proactive action by
the Government of Malaysia, the Second Stimulus Plan, which
41
was announced by the Prime Minister YAB Dato’ Sri Mohd Najib
25 STERLING YEARS
Tun Razak in March 2009, ignited the resuscitative spark.
By July 2009, the monthly Total Industry Volume (TIV) was

already showing very positive signs of recovery and the industry
performance in the last quarter of 2009 outperformed the
corresponding period in 2008 by a whopping 18%, closing
the year with an annual TIV of 536,905 units, just 2% shy
of the 2008 TIV but surpassing even Malaysian Automotive
Association’s (MAA) revised forecast of 500,000 units by a
commanding 7%.
The momentum from the last quarter of 2009 continued in 2010

and the numbers thus far have simply been record breaking.
The recorded TIV for the months of January to March 2010 are,
33%, 9% and 25% higher respectively than they were in the
corresponding months of the previous year and an encouragingly
superior 22% compared to the same quarter last year.
Nevertheless, despite a marginal shrink of 2% in the TIV

(all vehicles and passenger vehicles), PROTON recorded a
commendable increase in market share in both categories; from
25.9% in 2008 to 27.6% in 2009 (TIV all vehicles) and 28.5%
in 2008 to 30.4% in 2009 (TIV passenger vehicles).
Dato’ Sri Mohd Nadzmi

Bin Mohd Salleh
Chairman/Non-Independent
Non-Executive Director
The 2010 Frost & Sullivan Malaysia Excellence Awards: Best Passenger Car Model of the Year recipient – the
Saga – led the way for PROTON, with more than 70,000 units sold in 2009. The Persona, our “Pride and Joy”
which started the revival of the Company, continues to be a favourite by breaching the 40,000 mark. Another
noteworthy achievement is the Exora, PROTON’s first multi-purpose vehicle (MPV) and recipient of the 2010
Frost & Sullivan Malaysia Excellence Award for Best Automotive Debut Model of the Year, which recorded unit
sales of more than 18,000. This not only contributed to the increase in PROTON’s unit sales but also added
to the increase in the TIV (multi-purpose vehicles category) which bucked the declining trend.
42 Moving forward, MAA has revised its initial 2010 TIV forecast of 550,000 by an additional 20,000. This is
primarily driven by the bumper first half of 2010 and if the 570,000 target is achieved, the benchmark set
in 2005 of 552,316 units will be surpassed. This improved outlook is based on better consumer sentiment,
25 STERLING YEARS
enhanced business confidence, global economic recovery and stable interest rates.
Cautiously optimistic, PROTON remains committed to developing the right car for the right market, at the
right price and at the right time – a simple yet burgeoning aspiration for the Company. Growing consumer
confidence in the brand has been a great motivation for PROTON not only to intensify but also expedite
efforts to introduce even better quality, more appealing and competitive models aimed at both strengthening
our position in the domestic market and continuing with our efforts for an even greater acceptance in the
international market.
Export wise, PROTON also recorded a jump in sales of more than 35% as compared to the previous financial
year and this is largely attributable to the much improved performances in China (with our business partner,
Youngman), Thailand, Indonesia, Australia and Taiwan. Moving forward, the Asian Multi-Local OEM (AMLO)
strategy remains the key driving factor with regard to our international programme. Thailand and China
remain our most successful export markets and with our Completely Knocked-Down (CKD) programme with
Youngman steadily progressing, we are very confident that China will be a very successful international
venture for the Company.
Proton Exora being given the thumbs up

during the launch in Indonesia.

FINANCIAL PERFORMANCE 43
For FY09/10, PROTON Holdings Berhad posted a consolidated profit before tax of RM261 million, which is
25 STERLING YEARS
a marked improvement compared to the loss before tax of RM319 million in the last financial year.
Despite a contraction in the TIV, revenue for the year ended 31 March 2010 grew by 26% to RM8.23 billion
compared to RM6.52 billion posted in the last financial year. This performance was the result of encouraging
sales recorded by three core models – the Saga, Persona and Exora.
The marked improvement in performance is also a result of cumulative initiatives launched by the
Management over the last few years, which included amongst others, enhancing product portfolio, tightening
cost management, ensuring manufacturing efficiency, improving quality and strengthening the automotive
ecosystem through dealer and vendor consolidation initiatives.
Additionally, PROTON’s cash and cash equivalents recorded an increase of 79%, up to RM1.6 billion and
this augurs well for the Group as cash resources are required for continued investments in the development
of newer, better and greener products.
DIVIDENDS
On the back of a significantly improved FY09/10, the Board of Directors of PROTON recommends the
payment of a First and Final dividend of 20 sen per ordinary share of RM1.00 each less tax at 25% on
549,213,002 ordinary shares amounting to RM82,381,950 in respect of the financial year ended 31 March
2010, subject to the approval of our Shareholders at the Company’s forthcoming Annual General Meeting.
TOWARDS A NEW DAWN

It must be appreciated that as the world moves more and more towards globalisation, rationalisation
and liberalisation, companies and industries which are not lean and streamlined will be mired by its
uncompetitiveness, suffering almost certain degradation and ultimately, limply bandied about in a highly
charged industry until it is rendered obsolete and irrelevant.
The future is upon us and, with a score and five years under our belt, we have taken stock of our strengths and
44 weaknesses and the Board has accordingly instructed Management to proceed with the internal restructuring
of the Company with the aim of making each and every core division in the Company leaner, globally
competitive and potentially less dependant on PROTON’s captive businesses.
25 STERLING YEARS
As a company is defined by its product, the more than encouraging market acceptance of our Persona,
Saga and Exora exemplifies PROTON’s commitment towards excellence. Moving forward, newer and more
exciting products are in the pipeline and we believe that these will not only cement our presence in the global
automotive industry but will also expand our market and customer base.
His Majesty DYMM Seri Paduka Baginda Yang di-Pertuan Agong Al-Wathiqu Billah Tuanku Mizan Zainal Abidin Ibni
Al-Marhum Sultan Mahmud Al-Muktafi Billah Shah taking a closer look at the Evora during his visit to Lotus in the UK.

PROTON’s Advisor, Chairman and
Managing Director at the unveiling of
the EMAS at the Geneva Motorshow. 45
25 STERLING YEARS
By the end of 2010, one new product will be launched in collaboration with Mitsubishi and a facelift of
an existing model will be produced to ensure the continuous growth and development of our product range
and line-up. Thereon, PROTON will be focusing on a very exciting 2011 with the introduction of our turbo
engine, two facelifts and another brand new product which will signal PROTON’s transformation in terms of
design and styling.
Beyond 2012, the EMAS (Eco-Mobility Advanced Solution), which was unveiled at the recent Geneva Motor
Show, is merely, for the lack of a better expression, the tip of the primordial iceberg. The EMAS is not
merely a concept car but it is the physical embodiment of the pride, passion and progress that has charged
the Company through all these years and it is also a snippet of our dreams and aspirations, in terms of
concept, styling, design, technology and elements of these will be incorporated in all our future products
and technological offerings.
In terms of technology, since 2008, greater emphasis has been placed on electric and hybrid technology
and today, we can see breakthroughs being made. Although it may be some time before mass production
takes place, if all goes according to plan, units will be made ready in the very near future for market testing.
Additionally, as a direct consequence of our investment in these new technologies, there is a clear up-skilling
of human capital which translates to the development of our engineers and technicians and it is already
foreseeable that this select group of people will be the pioneers of the future PROTON.
With regards to Lotus, I am also very happy to announce that with the successful launch of the Evora, Lotus
has, to a certain extent, regained some of its former glory. The Evora has won many accolades and garnered
rave reviews all around the world. Nonetheless, to ensure that Lotus lives up to its iconic brand, the recent
appointment of Mr Dany Bahar, as Chief Executive Officer, who was formerly of Ferrari, and with the injection
of key personnel from established OEMs and engineering companies into the current management of Lotus,
we strongly believe that there will be stronger cooperation and understanding between PROTON and Lotus.
What needs to be done now is the turnaround of a legendary car company and with more aggressive and
business minded management teams on both sides of the world, I believe the equation will be one of
success.
46
25 STERLING YEARS
PROTON’s 25th Anniversary commemorative book, “A Saga - PROTON’s 25 year story”, was launched by Prime Minister
Dato’ Sri Mohd Najib Tun Razak during PROTON’s 25th Anniversary Gala Celebration.
ACKNOWLEDGEMENT
PROTON’s improvement in FY09/10 and more so, its growth in the past 25 years, is a clear message to
the rest of the world that PROTON is more than just a car company. PROTON is the realisation of the
dream and the dogged determination of a leader leading its nation from an agrarian-based economy towards
industrialisation. We are the personification of the collective pride of the nation, powerfully driven by passion,
and perseveringly focused on progress. In spite of all the cynical criticisms, doubts and scepticisms, we have
continued to be the champion of the industry – and we intend to remain as the only one and true champion
of the national automotive industry.
Like its scientific namesake, PROTON is positively charged at the core by its people and throughout the
quarter of the century, we have been blessed with the pride, passion and progress of tens of thousands of
PROTONians. Although many have left, many more still remain and I am certain we will welcome many
more in the years to come. To each and every one of you who was and those of you who are still with
PROTON, on behalf of the Board of Directors, I extend a sincerely humble heartfelt Thank You for your
generous contributions to the development of this national car project. In addition, as we celebrate our 25th
Anniversary, a very special Thank You also goes out to the 651 employees who have served the Company for
25 years or more. Although individually, a quarter of a century might seem pedestrian, collectively, you are
an automotive treasure trove of a staggering 16 millennia.

I would also like to take this opportunity to thank the members of the Board who have recently resigned,
namely Tuan Haji Abdul Jabbar Abdul Majid, Tuan Haji Abdul Kadir Md Kassim and Mr Oh Kim Sun for their
invaluable contribution and guidance during their years of service with the Group. At the same time, I would
like to welcome Mr Behara Venkata Rama Subbu, the former President of Hyundai Motor India, YBhg Tan Sri
Rainer Althoff, the former President and CEO of Siemens Malaysia and En Abdul Rahim Hamid, the current
President of Malaysian Institute of Accountants, onto the Board of Directors of PROTON. I am very certain
that your collective and illustrious experiences in a mosaic of industries will be a boon to the Group as we
continue our journey towards excellence. 47
To the extended PROTON family – our shareholders, sales/service dealers and vendors and business partners
domestically and internationally – goes our sincerest appreciation for your continued perseverance and
25 STERLING YEARS
dedication through the years. Rest assured, we are committed to an exciting future and we hope that you
will be with us every step of the way.
I would also like to record my gratitude to the remaining members of the Board of Directors and the
Management Team, ably led by YBhg Dato’ Syed Zainal Abidin Syed Mohamed Tahir, for their vision and
commitment to guide PROTON in achieving our strategic objectives.
Our sincerest gratitude also goes to our Prime Minister YAB Dato’ Sri Mohd Najib Tun Razak, our adviser
YABhg Tun Dr Mahathir Mohamed, and the Malaysian Government under the leadership of three Prime
Ministers, for their continued support and guidance of PROTON and the Malaysian automotive industry,
without which, our progress and the growth of the industry in the past 25 years would have been greatly
reduced and immaterial.
Finally, to our ever increasing customers around the globe, thank you for your renewed confidence and
continued support. Our promise is simple – it will be an even better and greater 25 years. Many more exciting
products are in the pipeline and we have committed to double our efforts in ensuring uncompromising
customer satisfaction.
To the next 25 years of Pride Passion and Progress – I am Positively PROTON.
Thank you
Dato’ Sri Mohd Nadzmi Bin Mohd Salleh

Chairman
Managing Director’s Review
“IN THE 25 YEARS OF OUR OPERATIONS,

WE HAVE ACQUIRED NOT ONLY THE
KNOWLEDGE BUT ALSO THE RIGHT
SKILLS AND EXPERTISE TO BUILD GOOD,
COMPETITIVE CARS, AND NOW WE ARE
48 STRENGTHENING OUR FUTURE STRATEGIES
TO SUCCESSFULLY COMPETE IN THE GLOBAL
25 STERLING YEARS
MARKET.”
CELEBRATING OUR PAST,

PRESENT AND FUTURE
Originally conceived by Yang Amat Berbahagia
Tun Dr. Mahathir Mohamad, the then Prime Minister
of Malaysia, PROTON was incorporated on 7th of May
1983 with the aim of building a national car company
that will act as a key driver of national development to
accelerate the nation’s auto manufacturing capabilities
through technology transfer with strategic partnerships
and technical collaborations.
Twenty-five years on, from a mere car assembler to a

full-fledged car manufacturer and weathering the best
and worst of times, PROTON stands on a foundation of
sterling strength as Malaysia’s largest auto manufacturer,
the only full-fledged OEM car manufacturer in South-
East Asia with international engineering expertise as a
result of our 100% stake in Lotus Group.
MANAGING
DIRECTOR’S
REVIEW 49
25 STERLING YEARS
Today, our operations have extended
across South-East Asia to the Middle
East, China, Australia and the United
Kingdom. Our global workforce totals
over 11,789 personnel working in
all areas of vehicle design, R&D,
manufacturing, marketing, sales &
distribution and corporate services.
We have a team of Lotus engineers
permanently based at the design and
development centre in Shah Alam,
Malaysia. We have also achieved a
stable of well-proven and well-received
products that enables the brand to
seize market share at home as well
as abroad – ranging from versatile
and reliable four-door family vehicles,
two-door hatchbacks for the young-
at-heart, stylish executive sedans,
spacious and affordable multi-purpose
vehicles to the world-renowned sports
cars from Lotus.
It is truly inspiring to be able to see our

efforts and achievements over the years
coming to fruition and how PROTON
DATO’ HAJI SYED ZAINAL ABIDIN B has managed to rise above the various
SYED MOHAMED TAHIR challenges and hurdles throughout
the years. To succeed in providing
Managing Director
competitively priced and high quality
vehicles to all our customers has also
been truly motivating.
50 During the year under review, the launch of PROTON’s first multi-purpose vehicle, Proton Exora,
in April 2009 was followed by the introduction of several refreshers such as the Saga SE, Persona
Elegance and the Satria Neo Lotus Racing Edition. These models were well-accepted by the market,
25 STERLING YEARS
with consistent orders received. As promised, PROTON keeps enhancing its operations, processes and
quality to drive and strengthen the company further, year after year.
Celebrating our Brand

Having achieved our initial goals, we are now in the position to go further and strengthen our global
presence. Building a brand globally requires PROTON to energise, transform and raise the brand
consciousness among a greater diversity of consumers. As mentioned last year, we have always
believed that the value of the PROTON Brand is a result of many factors including products and
services, customer experiences and marketing. Thus, after 25 years, it is with this sense of maturity
that the PROTON Brand is evolving, to focus on its customers’ needs and wants.
Celebrating Research & Development

PROTON’s Research and Development facility has contributed a most critical activity to the Company;
innovation in design and creative engineering methods. Consumers can now expect PROTON to deliver
more unique, stylish and attractively priced cars.
In March 2010, we unveiled the EMAS concept cars at the prestigious Geneva Motorshow. EMAS,
which stands for Eco Mobility Advance Solution, marks the commencement of our global small car
feasibility study which is part of PROTON’s plan to enhance its product line-up. This vehicle is not
only a show vehicle but also illustrates PROTON’s innovative thinking into the future of small cars.
With the EMAS project, PROTON has stepped up to meet global trends by committing to deliver a
world class and eco-friendly vehicle that is spacious and stylish. The global small car will be a major
product drive for PROTON in all our targeted markets.
Moving forward, we aim to be the driver for green initiatives in Malaysia through close collaboration
with the Malaysian Government. We have outlined a strategic plan in relation to this field and are
expecting to proceed with the implementation soon. At the same time, we have also embarked on
hybrid and electric vehicle projects in which our test fleet vehicles are expected to roll out by 2012.
51
25 STERLING YEARS
PROTON’s Managing Director, Chairman and Advisor look on as Prime Minister YAB Dato’ Sri Mohd Najib Tun Razak
unveils the EMAS concept car during PROTON’s 25th Anniversary Gala Celebration.
Celebrating Quality
Our quest to deliver quality has been recognised through numerous awards bestowed upon the Group
throughout the years.
Recently, PROTON received two distinguished awards for the Proton Saga and Proton Exora at the
2010 Frost & Sullivan Malaysia Excellence Awards. These were the awards for the Best Passenger
Model Car of the Year for the Proton Saga, and Best Automotive Debut Model of the Year, for the
Proton Exora. PROTON had previously received the Frost & Sullivan award in 2008, when the Persona
was named Best Model of The Year.
The Saga and Exora were evaluated on a variety of market performance indicators including revenue
growth; market share; leadership in product innovation; marketing strategy and business development
strategy.
These awards endorse the success of PROTON and are true indications of how the Company has
progressed and stamped its mark in the industry.
PROTON’s achievements have also been acknowledged by several other awards for its cars, namely,
the Best Model of the Year for the Saga by the 2009 Asia Pacific Frost & Sullivan Automotive Award,
Best Local Assembly Sports Car for the Satria Neo CPS and the Best Local Assembly MPV for the
Exora by the Asian-Auto VCA Auto Industry Awards 2009, and the Car of the Year Award for the Small/
Medium MPV for the Exora by the Autocar Asean Awards 2009.
52 Celebrating excellence
In May 2009 we signed a new Master Dealership Agreement with Edaran Otomobil Nasional Berhad
25 STERLING YEARS
(EON) in a move to rationalise the sales and services network of Proton vehicles. The Rationalisation
Programme was implemented to establish the right number of dealers according to the needs of
PROTON.
With the signing of the new agreement, all EON sales and service dealers underwent a migration
process into the EDAR sales and service network and subsequently, EON no longer had any
sub-dealers, be it sales or after-sales for, Proton vehicles.
In our effort to further rationalise operational processes and costs, we had also initiated a Vendor
Rationalisation Programme. The supplier base was restructured using a Tiering System based on
vehicle modules as well as vendor specialisations.
PROTON’s original factory plant, covering 99,400 sqm, is located at Shah Alam near Kuala Lumpur in
central Malaysia. The site houses an engine and transmission factory, 2 assembly plants, R&D centre
and a semi-high speed test track. The factory has the capacity to produce 240,000 units vehicles per
annum.
In 2005, PROTON’s second production facility in Tanjung Malim was inaugurated to cater to the
projected increase from both the domestic and export markets. Mostly automated, the Tanjung
Malim plant is five times larger than the existing facility in Shah Alam and incorporates the latest
manufacturing systems and technology designed for better efficiency, productivity and quality.
Designed to be flexible, each production line in Tanjung Malim is capable of assembling vehicles on 53
three different platforms and producing up to nine different models at any one time. The production
line at Tanjung Malim also benefits from an Automated Line Control (ALC) or error-proof system
25 STERLING YEARS
integrated to maintain higher efficiency and higher quality of cars. Operating with an 85 per cent
pass ratio compared to the existing 65 per cent pass ratio at Shah Alam, the new plant has recorded
a reduction in operational costs by 20 per cent.
Celebrating passion, unity and commitment

As we celebrate our 25th Anniversary, I take the opportunity to thank all PROTON staff members for
their dedication and contribution to the Company, without whom our growth and success for the past
25 years would not have been possible. The hard work and loyalty of the PROTON family paved our
journey and we shall continue the quest to take this Company to greater heights.
With hard work and determination from the workforce, I am optimistic that PROTON will stand the test
of time, by being progressive and dynamic, despite the challenges that will come our way. Nothing is
impossible, and with everyone’s continuous determination and hard work, I am confident that PROTON
will one day conquer the world market and stand tall on the world map of the automotive industry.
On this note, I am pleased to present you our Operations Review that highlights the key developments
and initiatives of the Group, which is a clear reflection of our achievements to date.
Thank you
DATO’ HAJI SYED ZAINAL ABIDIN B SYED MOHAMED TAHIR

Managing Director
Operations Review
ENGINEERING SERVICES
AS THE ENGINE POWERS ACCELERATION, THE ENGINEERING DIVISION
EMPOWERS PROTON’S EMERGENCE INTO A NEW DAWN. THE VITAL
54 HUBS OF VEHICLE DEVELOPMENT, ENGINE DEVELOPMENT, STYLING
& TECHNOLOGY DEVELOPMENT AND RESEARCH, MAKE THIS DIVISION
25 STERLING YEARS
THE CORE WITHIN WHICH POSSIBILITIES ARE CONCEIVED, INCUBATED,

GERMINATED AND HATCHED.
A new milestone was reached in 2010 with PROTON’s maiden success in developing new age hybrid
and electric cars. The Division achieved a series of outstanding successes in engineering, style and
technology development which was evidently on display at the launch of the EMAS Concept cars at
the Geneva Motorshow in March 2010.
While breaking new ground in our design and engineering capabilities, the Division continued upgrading
features and performance with the release of new and enhanced models. During the year under review,
PROTON also achieved local and regional recognition for several research and development works on
various aspects of automotive engineering.
Powering the development of home-grown talent, PROTON’s Engineering Division continues to

collaborate with local institutions of higher learning and corporations, as well as support the
advancement of automotive engineering as a course of study at university levels.
To keep pace with our global aspirations, the Division is also focused on ensuring optimum engineering
support to overseas partners, and Product Lifecycle Management (PLM) to cut down on time and costs
in delivering new models to the market.
Becoming
the No. 1
Choice
A New Dawn
for Engineering
Services
Operations Review
PRODUCT DEVELOPMENT
Proton Persona Elegance
As the next evolution in the Persona lifecycle, the Elegance was conceived to offer ever more discerning
customers an enhanced and attractive sedan, by elevating its value proposition to an even higher level. The
Persona has attained the accolade of being Malaysia’s most popular mid-size sedan for over 2 years running
56 since its launch in August 2007. It has achieved class-leading sales figures, proving that the unveiling of the
Elegance in March 2010 came at the right time for a mid-cycle facelift.
The numerous upgrades for the Elegance are beyond skin-deep, as nothing has been spared in the pursuit of
25 STERLING YEARS
quality. Improved fit, finish, specification, design and Noise, Vibration & Harshness (NVH) levels are now part
of every unit rolled off the production line. The Elegance also comes equipped with new upmarket features.
These include an MP3 Radio with USB, LED Side Turn Signals and Rear Combination Lamps, as well as
luxurious leather seats for a more sophisticated image. Occupants’ safety remains a priority as the Elegance
continues to offer active and passive safety systems, such as Dual Airbags, Anti-Lock Braking System (ABS)
with Elecronic Braking Distribution (EBD), Side-Impact Protection Beams, a Collapsible Steering Column,
and the legendary Lotus Ride & Handling – a standard feature in every Proton.
Operations Review

Proton Saga Special Edition (SE)
The Saga Special Edition (SE) was launched in July 2009 as a premium variant of the highly
successful Saga, providing the masses with a car that is affordable yet hip and stylish.
Some of the refinements come in the form of sporty alloy wheels, attractive color schemes,
comfortable leather seats, purposeful body kit, and various other tasteful appointments. 57
Continuing with the proven and reliable 1.3L Campro IAFM engine, the SE offers enough
power-on-demand for a spirited drive, be it in the city or in extra-urban settings. Even with
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its inexpensive price tag, safety is not compromised, as the SE has a tough and rigid body
construction, in addition to many other safety features.
Versatility and practicality come bundled with the 413-litre boot, cup holders, storage
compartments, and door pockets. All these epitomize PROTON’s quest to offer Malaysians a
car that is engineered with them in mind. It embodies all the qualities one would desire in
a car – style, convenience, safety and affordability. In this regard, the SE has truly banished
all conventional notions, and delivers all its promises in a neat package.
Operations Review
STYLING & TECHNOLOGY DEVELOPMENT

Global Styling – EMAS Concept Car
The EMAS concept car project is a joint development initiative with ItalDesign-Giugiaro of Italy where
PROTON has harnessed the wealth of experience available from the Maestro in designing & engineering cars
for the masses.
58 The halo effect of this collaboration is immense and can best be valued over time. Such is the nature
of Design where the maturity of a particular direction can only be judged when it has achieved critical
mass within every product in the organisation. It is worth mentioning also that the joint development with
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ItalDesign-Giugiaro has yielded a fresh and far stronger corporate image for PROTON’s cars. This new image
is what will propel the new Global Styling Initiative.
Hybrid Vehicle
Looking to adhere to the Malaysian Government’s low carbon and green growth agenda, PROTON has started
initiatives in the development of hybrid electric vehicles. The project was initiated in September 2009 and
the prototypes are being subjected to performance evaluation, testing and safety assessment.
By adjusting to the environmental standards in the global vehicle market, the Hybrid can lead the Southeast-
Asian region in the rapidly emerging market for alternative green vehicles with low carbon emission and fuel
consumption.
Moving forward, PROTON is forming strategic partnerships with Government agencies, engineering
consultants and academic institutions to lead and manage a hybrid fleet test vehicle (FTV) programme to
encourage the development of supporting infrastructure, green legislation schemes and public acceptance
towards a greener future.
Operations Review

59
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Powertrain/Drivetrain and Energy Storage
Electric Vehicle (EV)

PROTON entered into the development of electric vehicles as a long-term strategy towards
acquiring and commercialising the technology as indicated in the PROTON Technology
Roadmap. This is also part of the initiative to support the National Green Technology Policy
that was implemented to chart the nation’s development in green technology as the new
driver of economic growth.
Electric vehicle is a type of alternative fuel car that utilises electric power to run motors
instead of an internal combustion engine. The electric power is usually derived from battery
packs which are at high rechargeable rates. The car is also built with intelligent motor
controllers for optimum electric usage.
Earlier, 2 units of EV vehicles were developed with Lotus Engineering, UK. The PROTON Persona
was developed as a performance EV demonstrator with longer range, faster acceleration and
higher maximum speed, whilst the SAGA was developed as a basic city driving demonstrator
to meet urban city driving needs.
As a benchmarking exercise, PROTON also jointly developed two additional units of Proton
SAGA using a different technology provider. These 2 additional EVs are now going through the
testing and evaluation phase.
25 STERLING YEARS PROTON 2010 Annual Report
60
Operations Review
Operations Review

His Majesty DYMM Seri Paduka Baginda
Yang di-Pertuan Agong Al-Wathiqu
Billah Tuanku Mizan Zainal Abidin Ibni
Al-Marhum Sultan Mahmud Al-Muktafi
Billah Shah being briefed on the High
61
Performance Engine during a visit to
Lotus in the UK.
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ENGINE DEVELOPMENT
Higher Performance Engine (HPE)
Engine technology moves rapidly with the global demand for high performance yet lower
emissions. PROTON responds with the introduction of the higher performance engine (HPE)
plan for production in 2011. The program is in collaboration with Lotus Engineering, UK.
The key objectives are enhanced performance, emissions and quality standards to support
PROTON’s future product introductions.
The main program is the design and development of an engine equivalent in performances to
a 2.0L naturally aspirated engine. Thirty six PROTON engineers and technicians have been
integrated with the Lotus Engineering project team in Hethel, United Kingdom, working
together in all areas from Project Management, Powertrain Design, Powertrain Analysis,
Engine Development and Engine Calibration. The project team also works with leading
global suppliers from Europe, Japan, South Korea, China, India and ASEAN.
His Majesty Duli Yang Maha Mulia Seri Paduka Baginda Yang di-Pertuan Agong Al-Wathiqu
Billah Tuanku Mizan Zainal Abidin Ibni Al-Marhum Sultan Mahmud Al-Muktafi Billah Shah
officiated the first ‘key-on’ ceremony for the HPE on 2nd October 2009 during His Royal
visit to Lotus in Hethel.
Operations Review
COLLABORATION
Research Collaboration With Universities
(a) Universiti Teknologi Malaysia (UTM)
PROTON and Universiti Teknologi Malaysia (UTM) signed a Memorandum of Understanding (MOU) in
62 February 2009 with the objectives of promoting the exchange of technical expertise, cultivating joint
research, sharing of facilities, and creating a pool of experts towards achieving excellence in R&D and
consultancy.
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A PROTON Professorship Program had been established with the assignment of one lecturer to PROTON
for two years to carry-out the work as stated within the objectives of the MOU. The collaboration effort
is expected to benefit both parties by maximising each others’ resources. This could potentially reduce
financial investment and speed up R&D processes required to bring the product into the market place.
It is also part of PROTON’s corporate responsibility and continuous efforts to be proactive in making
improvements to its product quality.
Some of the research areas that have been identified for further studies include noise level reduction
in the cabin of a vehicle, cabin climate control design, analysis of a door side mirror using wind tunnel
and vibration test, and the development of a new transmission concept.
(b) Universiti Teknologi MARA (UiTM)
PROTON and Universiti Teknologi MARA (UiTM) signed a Memorandum of Understanding (MOU), which
took place on 13th January 2010. The Agreement is for a three-year collaboration involving automotive
technology, styling (art & design), and human capital development.
The MOU covers the exchange of staff, sharing of facilities, acquiring intellectual property rights,
journals, publications, conferences and workshops of relevant projects as part of PROTON’s Technology
Roadmap activity.
Expected outcomes from the alliance are industry-university knowledge sharing, technology development,
cost savings and competent graduates in automotive industries – in terms of technical, business and
relevant soft skills. Some of the areas identified for further study include photo-voltaic powered auto
ventilation, thermal management of car cabin, cabin odour control and super-activated carbon for butane
canister.
Operations Review

(c) Taylor’s University College (TUC)
A Non-Disclosure Agreement (NDA) and Collaboration Agreement (CA) were signed

between PROTON and TUC for ideas generation and development and evaluation of
projects. Four project proposals have been developed by TUC namely:
Project 1 – Air cond Accelerator
Project 2 – Lock Status Indicator
Project 3 – Parking Mirror 63
Project 4 – Mini Head Up Display (HUD)
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The project study was completed in December 2009.
Dato’ Sri Mohd Najib Tun Razak with Dr. Maximus Ongkili
witnessing the exchange of the MOU between PROTON
Managing Director Dato’ Haji Syed Zainal Abidin Syed Mohamed
Tahir and CEO of MiGHT Encik Mohd. Yusoff Sulaiman at the
Putra World Trade Centre (PWTC),Kuala Lumpur.
TECHNOLOGY COLLABORATION
(a) Vehicle Advanced Telematics System (VATS)
PROTON, Azanor Exim Sdn. Bhd. and the Malaysian Industry-Government Group for
High Technology (MiGHT), have signed a Memorandum of Understanding (MOU) for
the implementation of the ”Vehicle Advanced Telematics System” (VATS) Program in
October 2009. This collaboration stems from TechnoMart Malaysia™, a technology
trading platform under the initiative of the Ministry of Science, Technology and
Innovation Malaysia (MOSTI) and MiGHT.
VATS is a national project under the Telematics Industry Development Program that is
aimed at providing a conducive infrastructure for the development of the telematics
industry for the automotive sector in this country. Through this joint venture, MIGHT-
PROTON-Azanor will also expand this program to the local small and medium industries
in an effort to improve the capability of local automotive telematics technology
comparable to international standards. The technology will incorporate among others,
the auto-electronics, GSM communications, low orbit satellite communications, GPS,
GIS and a variety of sensors.
The VATS project includes a build up of a full demo vehicle on the P.O.C (Proof Of
Concept). This is now undergoing Feasibility Study and Market Research.
Operations Review
MARKET SUPPORT (EXPORT)
• China
The Engineering Division provides product & technical information support to our Chinese business
partner especially for localisation activities, as well as to establish the engineering system and data
management.
64
• ASEAN, Other Markets
Continuous engineering support in the areas of vehicle, powertrain and testing is being provided for these
25 STERLING YEARS
markets.
AUTOMOTIVE LEGISLATION UPDATES

PROTON carries out a thorough study on product compliance, benchmarking against regulatory requirements
of each designated market at the earliest time possible. The implementation of new legislations between year
2009 to year 2018 in PROTON existing markets, may require PROTON to revise its development strategy so
as to meet those regulatory requirements. This includes the mandatory fitment of brake assist system (BAS),
electronic stability control (ESC), tyre pressure monitoring system (TPMS), gear shift indicator (GSI) and
daytime running lamp (DRL).
Other than that, vehicles must also be able to comply with the requirements of pedestrian protection, CO2
emission, Euro 5 and Euro 6 emission standards, mobile air-conditioning system and reusability, recyclability
and recoverability depending on the specific market.
Operations Review

PROTON Managing Director Dato’ Haji Syed Zainal Abidin Syed
Mohamed Tahir (second from left) exchanges documents with Hewlett- 65
Packard Enterprise Services Asia-Pacific & Japan Senior Vice President
Kevin Jones (second from right) while PROTON Engineering Division
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Director Tajul Zahari Abu Bakar (left) and Siemens PLM software
experteam Asia Pacific Vice President Gavin Spier look on.
PRODUCT LIFECYCLE MANAGEMENT (PLM)

As PROTON grows beyond the local market, we continue to employ innovative technology
which will help us to accelerate the development of our products in a more timely, and cost-
effective manner. Product Lifecycle Management (PLM) solution is an initiative that PROTON
has adopted, to manage the entire product lifecycle processes right from conceptual design
through to after sales support. The program is being carried out together with the support of
Hewlett-Packard (HP) and Siemens PLM.
The advantages of PLM solution include:

• Improvement of the end-to-end development timeline which accelerates introduction of
new models to the market.
• Management of cost throughout the product lifecycle to ensure cost effectiveness with
possible cost reduction.
• Collaboration and networking within internal and external engineering partners to allow
seamless work integration and knowledge sharing to improve product quality.
PLM solution links not only the entire product lifecycle processes but also the whole team
that is involved in it. Therefore, collaboration, integration and information sharing could
easily happen.
Operations Review
(from left to right)

Winner: Super carrier business concept;
Second prize winner: Sport shoe inspired convertible; and
Third prize winner: Mid-engine Saga.
66
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RECOGNITION IN R&D
First Prize (Poster) at 5th India/ASEAN Hyperworks Technology Conference
The Computer Aided Engineering (CAE), Crash & Safety Group, won the 1st prize under poster category (paper
without presentation) at the 5th India/ASEAN HyperWorks Technology Conference 2009 held in Bangalore,
India. The poster was entitled ‘Application of Plackett-Burman Experimental Design through Altair Hyperstudy
in Frontal Crash Performance’. The conference was attended by over 800 CAE engineering professionals
from all over India and South Asia. The full technical paper was also published in the journal of the 3rd
International Conference on Energy and Environment (ICEE) 2009, under the sustainable energy category.
Best Conference Paper at South East Asia ABAQUS Users’ Conference

Additionally the CAE, Durability & Reliability Group, had won an award for the best technical paper at
South East Asia ABAQUS Users’ Conference entitled ‘Analysis of Gearshift Mechanism using Flexible Body
Approach for Structural Durability Assessment’ which was held in Penang. The presented paper was not only
hinged on the innovative numerical approach in integrating the physics of multi-body-dynamics with flexible
Finite Element modeling in one simulation environment, but also the intellectual property gained from the
established knowhow.
Asia Pasific Innovation Award at MSC ASEAN Users’ Conference

In August 2009, a technical paper entitled ‘Probabilistic Analysis in Virtual Development’ was presented by
the CAE Section at the Annual MSC ASEAN Users’ Conference in Sunway, Malaysia. The distinctive feature
of the analysis method as contained in the technical paper is the establishment of a Reliability Engineering
framework on top of the existing traditional Finite Element approach. It is an extension of the integration
between statistics and numerical analysis that put extra emphasis on Quality Engineering and Design-to cost
orientation. The analysis concept was quoted by MSC as the ‘New CAE Simulation Approach of the 21st
Century’. Based on those merits, the work presented by PROTON had received the Asia Pacific Innovation
Award 2009 from MSC Software Corporation, which was awarded by Tun Dr Mahathir during PROTON’s
Family Day 2010.
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67
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PROTON Innovation & Invention Competition
A competition named PROTON Innovation and Invention was organised for all staff of
PROTON at Shah Alam, Tanjung Malim and those of Proton Edar Sdn. Bhd.. The objectives
of this competition are to generate new ideas and interest among the staff in creating next
generation cars and also for employees to feel appreciated for their contributions to the
Company.
The competition was held for 3 months from June 2009 until August 2009. The winners
were decided based on the cost of build, creativity, styling and originality by internal and
external judges from UiTM, UTM & MOSTI. The top 20 cars were paraded around the factory
vicinity during PROTON’s Family Day in January 2010 for the staff and family members to
view and appreciate.
Tun Dr Mahathir awarding

the Asia Pacific Innovation
Award 2009 from MSC Software
Corporation, during PROTON’s
Family Day 2010.
Operations Review
MANUFACTURING
WITHIN 25 YEARS, PROTON’S MANUFACTURING CAPABILITIES HAVE
ACCELERATED FROM AN INITIAL CAPACITY OF 17,001 UNITS TO A
68 RECORD HIGH OF 173,057 UNITS LAST YEAR. THIS 918% GROWTH
AVERAGES AN ANNUAL INCREASE OF 11% PER ANNUM. THOUGH WE
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CONTINUOUSLY FOCUS ON BUILDING CAPACITY AND PRODUCTION

POTENTIAL, ACTUAL VOLUME IS TAILORED FOR OPTIMUM PERFORMANCE
TO RESPOND TO INDUSTRY DEMAND. THE DIVISION HAS STRINGENT
PROCEDURES IN PLACE TO REAP THE BENEFITS OF COST SAVINGS
VIA REALISING OPTIMAL PRODUCTION VOLUME AND STREAMLINING
STORAGE AND HOLDING COSTS.
After a slower phase of growth in 2008, the performance for the year under review is an indication of
positive things to come in the future as we saw increased demand for Proton vehicles even amidst a
generally bleak industry scenario.
The successful launch and introduction of the Exora, the first truly Malaysian MPV in 2009, helped
to improve the total production volume from 157,643 units to 173,057 units. Although it is new, the
Exora alone has contributed to 20% of the total volume in its first year of production, a testament of
its high demand.
Optimising
Operational
Capacity
A New Dawn
for
Manufacturing
Operations Review
In July 2010, the new Exora Special edition was launched and continued to capture the MPV segment with
70 its enhanced styling and product specification. The Saga will also be upgraded by having a two phase facelift,
the first facelift targeted in November 2010 with minor appearance modification and a second involving an
engine upgrade in 2011. This facelift is planned despite its continuing streak of high bookings. In fact in
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the last financial year, the Saga was a best seller several times for the Malaysian automobile market; due to
its impressive selling points of consistent quality, value for money and reliability.
The launch of the Persona ‘Elegance’ in March 2010 is another example of PROTON’s commitment to
continuously improve its products. The Elegance is equipped with better specifications including a 32bit
ECU which means increased functionality, better engine performance and increased diagnostic capabilities.
These combined with an enhanced stylish body kit, alloy rims and interior trim leather makes the Elegance
a much sought after car in its class. We expect the Elegance to continue its reign as one of the top revenue
generating models in our stable.
Operations Review

71
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Efforts to improve productivity and quality remain a core focus within the Manufacturing
Division. Quality levels improved in 2009, and with the increase in production volume,
we are also taking steps to raise our productivity index. We are putting plans into place
to involve the vendor community in our efforts to raise manufacturing standards in the
near future. This is crucial as minor disruptions in their operations can severely affect the
performance of our production lines.
Towards this end, we have set monthly benchmarks, and established new model lines so that
‘yokoten’ (a Japanese term which means copying) activities can be implemented. During the
year under review the Manufacturing Division also focused on workforce training to upgrade
skills and capabilities, upgraded the shopfloor working environment and sent key employees
for external training in a renowned Japanese institute. We hope to reap the benefits of
all these training programmes in the near future, and see our efforts come to fruition.
Operations Review
PROTON SHAH ALAM

The PROTON Shah Alam manufacturing complex includes the original Main Plant and the smaller Multi
Vehicle Factory (MVF). A separate Engine machining and assembly building is also contained within
the complex where cylinder blocks, crankshaft and camshafts for the Campro engine are machined and
subsequently assembled.
There is also a Casting plant which is situated in the nearby Glenmarie industrial area. The Casting plant is
72 able to produce up to 180,000 cylinder blocks, crankshafts and bearing caps. There are plans to increase
this capacity to 250,000 units per year. This is not only due to the increase in demand but also in order to
supply to our Chinese business partner, Jinhua Youngman Automobile Group, in the intermediate term.
25 STERLING YEARS
The Main Plant’s capacity is 150,000 units while the MVF’s capacity is 50,000 giving a total capacity of
200,000 units per year.
The Main plant currently produces the Saga, Waja and Arena models. The Saga model is the highest volume
model produced, averaging about 6,600 units a month. The capacity of the Saga has also been reviewed
from 72,000 units to 96,000 units to accommodate the good demand especially from the domestic market.
Operations Review

For the record, up to March 2010, the Saga production reached a cumulative volume of 162,676 units since
the start of production. By contrast, the production volume for the Waja and Arena are 3,352 units and 835
units respectively.
The Wira and Perdana which were produced at the Main Plant, reached the end of production for domestic
market back in June 2009. The Wira production has reached a volume of more than 1.09 million units while
the Perdana recorded a volume of more than 77,300 units. The Arena is anticipated to stop production 73
as planned in August 2010. This step is necessary in view of the need for PROTON to refocus its critical
resources on current core models and new model development.
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The MVF plant solely produced the 1st Malaysian MPV namely, the Exora. Since its introduction in April
2009, MVF has produced 33,689 units of Exora up till March 2010. In ensuring the EXORA continues to
capture the MPV segment, a cosmetic change has been planned and targeted for launch in July 2010. The
stylish body kit, sporty alloy rims and the new interior look of tempest gray are designed to attract younger
drivers who appreciate aesthetic detailing. This plant is also currently being modified to produce the new
replacement car for the Waja which is targetted for the production line by November 2010.
Operations Review
74
PROTON TANJUNG MALIM PLANT
PROTON’s Tanjung Malim plant in Perak has an annual capacity of 150,000 units (involving
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2 shifts) with a 60 per cent automation level, allowing man and machine to interact more
efficiently, productively and safely. The plant comprises 5 main buildings namely Engine &
Transmission (ETM), Stamping, Body Assembly, Painting and Trim and Final Assembly; all
equipped with an Automatic Line Control or error proof system to assist workers to enhance
built up quality on line and to achieve better production efficiencies.
Operations Review

To allow for greater flexibility in production, the plant is capable of producing multi-model products on a
common line. Each line can assemble vehicles on three different platforms and produce up to nine different
models at any one time. The Stamping shop is equipped with a 4,600 tonne transfer press, the largest
stamping equipment and the biggest of its kind in the Southeast Asian region.
Certified by ISO 9001 and ISO 14001, PROTON Tanjung Malim set new standards for a more conducive,
comfortable and safe working environment. Worker friendly features include a high roof concept and natural
aspirated ventilations that channel a cooling effect within the complex, where good ergonomics, brightly
coloured floors and well lit interiors facilitate energetic and dynamic performance. 75
Currently, PROTON’s Tanjung Malim plant produces the Persona, Gen.2, Savvy and Satria Neo models with
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Persona being the highest model produced on a monthly basis. During the year under review, the plant produced
45,045 units of Persona; 3,431 units of Gen.2; 4,513 units of Savvy; and 4,579 units of Satria Neo.
Prospects
Total production volume for FY10/11 is forecasted to increase by 20% compared to FY09/10’s actual
production volume of 173,057 units. The volume for this year has been set based on the projected domestic
economic recovery, TIV growth and export volume expansion.
The sudden increase in volume is forcing PROTON to rethink its strategy to optimise plant utilisation
and if possible minimise additional required investment. This is to maximise the reduction of the overall
manufacturing cost per unit.
For the next financial year, we plan to deliver 208,000 units, which means plant utilisation can now reach
up to 60%. Further upside in the volume is also envisaged due to the positive development in the Iraq and
China markets. Furthermore, in view of the launch of cosmetic changes for the current models and the
new replacement model for Waja, we are certain of an imminent increase in the production volumes, a very
challenging scenario indeed.
Presently the Saga, Persona and Exora make up more than 75% of the total FY10/11 volume plan. As part
of the activities to continuously refresh these models, cosmetic changes or face lifts have been planned. The
Persona Elegance, the minor Gen.2 cosmetic change, the Exora cosmetic change and the much anticipated
Saga facelift are examples of such endeavours.
Plant improvements have been planned to cater for the potential expansion of the CKD volume. Currently,
our main CKD importer is Jinhua Youngman Automobile Group (Youngman) which is assembling a rebadged
version of the Gen.2 and Persona. The CKD volume set for the next financial year for Youngman is 330%
higher than the previous year. In addition, Youngman is also requesting PROTON to support their production
of new models based on the PROTON platform. PROTON is also currently evaluating the possibilities of
supplying complete engines and some anciliary loose components to enable Youngman to develop their own
products.
PROTON has dispatched the first group of engineers to provide technical assistance to Youngman to improve
shopfloor management in Manufacturing. We believe the technical assistance support to Youngman will be
continued in the future, and we view this technical assistance as a preparation for our future prospects in
overseas plants operation – namely in Iran and India.
Operations Review
76
Lotus Evora production line.
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LOTUS
It was an exciting yet challenging year for the Group. Though there was great demand and appeal generated
for the stunning Lotus Evora, growth of the Group was restricted by the continuing weak trading environment,
market conditions, fragile consumer confidence, increased competition, cost pressures that led to increased
operational expenses and the volatility of the pound sterling.
Financially, the Group recorded a consolidated turnover of £139.3m for the fiscal year, an increase of 26%
when compared to the consolidated turnover of £110.9m in the previous corresponding period. Lotus Cars
was the main driver behind the increase with revenues increasing by 28% to £98.2m following the initial
contribution from Lotus Evora sales during the year.
Meanwhile, Lotus Engineering’s third party consultancy business continued to record year-on-year growth
with revenues increasing by 21% during the financial year to £44.2m. This growth results from sustained
market driven policies, focusing on clear service offerings centred on its core competencies to retain and
enlarge its client base.
However, despite the increase in gross profit on the back of increased turnover and improved gross profit
margins, the Group registered a consolidated loss of £11.2m during the financial year. Rising operating
costs exacerbated by unrealised forex losses on non-pound sterling denominated loans and asset impairment
adversely contributed to the financial results of the Group. Nevertheless, the loss for the financial year was
23% lower when compared to the loss of £14.2m incurred in the preceding financial year.
On the corporate front, Dany Bahar was appointed as Chief Executive Officer of Group Lotus, succeeding
Michael Kimberley who retired during July 2009 due to ill-health. Under Dany Bahar’s leadership, a new 5-year
strategic business plan has been formulated, building on the foundations he inherited. Underlying the new
strategic business plan is a radical transformation to reposition both Lotus Cars and Lotus Engineering with
the ultimate aim of delivering positive and sustainable financial returns to all Group Lotus’ stakeholders.
Operations Review

Operations 77
During the course of the fiscal year the total number of Lotus vehicles
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increased by 19% or 435 units to 2,715 units across 32 countries. This was
mostly driven by demand for the Lotus Evora.
The stunning Lotus Evora was unveiled to the worlds press in April 2009 to
great acclaim with the media continuing to praise the car throughout the year.
This has resulted in the Evora winning a number of high profile and important
awards and accolades. The total number of awards so far bestowed upon the
Lotus Evora is 8 and some citations from these awards are as follows:
Car Magazine – Performance Car of the Year 2009

“There are executive saloons that don’t ride this well, super cars that don’t turn in so crisply, and
surely no car on the planet steers like this. Lotus has managed to transfer everything that we love
about the Elise to a bigger, more refined, more grown up platform... It couldn’t really be much better
to drive – the Evora is nigh-on perfect. A winner on every conceivable level.”
Top Gear – Sports car of the Year 2009

“Its pretty, quintessentially British, fast and handles like a dream. Evora takes Lotus to a new place in
terms of quality but more importantly delivers a sports car rush that puts other marques to shame.”
Evo Magazine – Car of the Year 2009

“It’s a magical thing across the ground, deft like an Elise, with exceptional poise and feel. What
was telling for me was that, getting into it after any of the other finalists, it was even better than
I remembered: a bit smoother, a bit quicker and even sweeter dynamically, too. It’s a beguiling car.
… A quite brilliant car and worthy winner.”
Autocar – Britain’s best Driver’s Car 2009

“The best here. Brilliant on the track. Nimble, delicate and forgiving. Even better on the road.”
iMotor – Most Rated Car of 2008

“It’s [Lotus Evora] ‘rated’ score of 95 per cent is truly impressive and enough to see it beat brilliant
machines such as the Lamborghini Gallardo LP560-4 and Nissan GT-R.”
Operations Review
The first customers took delivery of their new Lotus Evoras on 1st September 2009 and shortly afterwards,
at the Frankfurt motorshow in mid September 2009, Lotus unveiled the Lotus Evora Cup Racecar which
underwent development over the winter. Part of the development process included a demanding development
testing activity at a snowy Snetterton Cricuit in Norfolk by Lotus Racing’s F1 driver Jarno Trulli.
As part of Lotus Engineering’s drive to continue to be world leaders in hybrid and electric vehicle technology,
the Lotus Range Extender engine for Series Hybrids was unveiled at the Frankfurt Motorshow, to great
78 acclaim from the rest of the motor industry. This engine has already been installed in three high profile
research vehicles: the “Limo Green” project, the Proton Emas concept and the Lotus 414E Hybrid, the two
latter vehicles debuting at the Geneva motorshow in March 2010.
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March 2010 also saw the return of the Lotus name to F1. Group Lotus PLC entered into a licence agreement
with 1Malaysia Racing Team (1MRT), to licence the use of Lotus Racing in F1. Whilst there is no financial
support from Group Lotus, the company is fully supportive of 1MRT’s F1 entry. It is recognised that Group
Lotus PLC will also benefit from the association with Lotus Racing with F1 being both true to Lotus’ racing
heritage and the pinnacle of motorsport competition with a global following.
At the end of the financial year, Lotus donated eight special edition ‘Naomi for Haiti’ Fashion for ReliefTM
Lotus Evoras which were auctioned to achieve in excess of 1.4m for the high profile charity.
As part of the Group’s ambition to generate worldwide brand awareness, Lotus returned to IndyCar racing
with a collaboration with experienced Indy Racing League Team, KV Racing. Lotus’ return to the highest
profile racing series in North America after a 40 year absence, begun with a flourish with Japan’s most
successful automobile racing driver, Takuma Sato, driving the 2010 Lotus IndyCar.
Operations Review

79
Prospects
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As Lotus embarks on its strategic journey to transform and reposition the Group, it readies itself for another
challenging yet exciting time ahead. Substantial investment is needed to implement the strategies but once
the transformation has taken shape, the Group will be on much stronger footing operationally and financially,
thus creating value for all its stakeholders.
Lotus Cars transformation will be underpinned by a clear strategy to differentiate its core offerings. Over
the period of the business plan, Lotus Cars will invest heavily in new products across key luxury sportscar
segments. The new product positioning requires a shift in brand position, to elevate the brand to the premium
segments whilst ensuring that the core brand strength and values are maintained. Achieving this requires
significant investment in marketing, sales, after-sales and manufacturing capability which will be further
supplemented by investment in a robust and integrated IT system to increase overall organisational efficiency
and effectiveness.
At the centre of Lotus Engineering’s business plan will be the investment identified to further strengthen and
build its core competencies in the areas of lightweight architectures, driving dynamics, efficient performance
and electrical and electronics integration. These four core competencies represent key disciplines which
have a high growth and portability potential. In parallel, Lotus Engineering will continue with its ongoing
efforts to improve operational and organisational excellence.
Acknowledging that the transformation of Group Lotus will be a significant undertaking, the management
team of Group Lotus has been strengthened with the recruitment of industry heavyweights from premium
sportscar manufacturers and premier global engineering service providers. These individuals bring with them
the necessary capabilities and skills as well as strong track records of delivering change.
Looking ahead to the new financial year, the primary focus is to ensure that the business continues to grow
using the resources available while introducing additional measures to control operational cost. Equally, if
not more importantly, is for the Group to ensure that the implementation of the strategies gains traction in
line with the business plan as this will also provide the Group with immediate benefits.
Lotus Cars will also focus on maximising sales of its current Evora, Exige and Elise offerings which will be
further enhanced by future variants to broaden and refresh the range and to meet a multitude of new legislative
requirements. An example is the new model year 2010 Elise which sports a new facelift, is equipped with a
new powertrain and boasts the lowest carbon emissions for a vehicle in its class at 149g/km.
Meanwhile, Lotus Engineering will continue the expansion and growth of its third party consultancy business
by generating new opportunities, leveraging on its core competencies and partnering with other engineering
service providers.
Operations Review
QUALITY MANAGEMENT
QUALITY IS THE DISCERNIBLE DIFFERENCE THAT SETS APART THE BEST
FROM THE REST. IT IS ALL ABOUT UNDERSTANDING OUR CUSTOMERS
80 AND TAKING ACTION TO FULFILL CUSTOMER EXPECTATIONS. AS
PROTON IS FULLY COMMITTED TO SATISFYING OUR CUSTOMERS, WE
25 STERLING YEARS
TAKE OUR COMMITMENT BEYOND THE TRADITIONAL APPROACH OF

QUALITY – THAT IS TO MERELY FOCUS ON QUALITY INSPECTION AND
QUALITY CONTROL. NO LONGER EFFECTIVE AND RELEVANT, THIS
TRADITIONAL APPROACH OFTEN OVERLOOKS THE FACT THAT QUALITY
MUST BE BUILT-IN INTO THE PROCESS AND CONTROLLED AT THE
SOURCE TO PREVENT DEFECTS FROM OCCURRING.
During the year under review, PROTON continued its journey towards quality excellence by embracing
the principles of Total Quality Management (TQM): transforming all aspects of quality in all areas of
business, cultivating quality culture, embedding further quality ownership by strengthening the cross-
functional organisation, emphasising more on process quality and instilling quality core values deeper
across the business value chain to deliver the intended quality results.
Surpassing
Standards
A New Dawn
for Quality
Management
Operations Review
82
25 STERLING YEARS
Quality Improvement
As customer focus and speed are our core values, PROTON is committed to
an effective quality improvement framework. In ensuring effective and timely
resolutions of quality issues, the Quality Improvement Committee (QIC),
comprising members of the senior management, meets on a weekly basis
meant to provide direction and decision on matters pertaining to quality.
Operations Review

The next step is to systematically and effectively implement these quality initiatives throughout the
organisation. To this end PROTON has established a company-wide cross-functional Quality Improvement
Team (QIT) in the last financial year to positively address product quality problems. Beyond this, a single
channel for the problem solving process was also established during the year under review to streamline
communication and coordinate problem-solving efforts.
The introduction of QIT has accelerated problem-solving and enhanced customer confidence. Internal quality
issues and more importantly, customer complaints, now all undergo a stringent 8 stage problem solving
process to ensure that the problems are resolved permanently. 83
As a result, warranty trends now register a 4% improvement as there is a lower percentage of warranty claims
25 STERLING YEARS
over sales revenue. Warranty defects have also shown improved trends for all models implying all quality
initiatives implemented so far via the QIT have started to bear results.
A dynamic work culture is created when individuals take charge and are empowered to make a difference.
The Kaizen Suggestion Scheme, one of the many initiatives to drive quality ownership and quality culture,
is a continuous incremental improvement and structured feedback system within PROTON especially in the
manufacturing environment. It encourages action by empowering individuals or groups to act to improve
processes and work conditions. During the year under review, the submission rate for suggestions improved
by 70% for both PROTON plants and 25% of the submitted suggestions have been implemented successfully
resulting in cost savings of RM12.4 million.
The development of quality ownership and quality culture in PROTON is further strengthened by the
implementation of the Innovative and Creative Circle (ICC), which is a group composed of PROTON employees
who are trained to identify, analyse, solve or enrich work-related concerns based on the Plan-Do-Check-
Action (PDCA) cycle. More than 250 ICC teams voluntarily registered in the last financial year to undertake
various projects to improve productivity, quality and cost. 97% of the registered teams have completed their
projects and these have recorded cost savings of up to RM26.2 million.
PROTON’s Managing
Director, Dato’ Haji
Syed Zainal Abidin, and
Senior Director of Group
Operations, Dr Wolfgang
Karl Epple, attending
the Company-wide
quality campaign at the
Shah Alam Main Plant.
Operations Review
Quality in Design & Development

In translating PROTON’s quality vision of “No. 1 in Functional Quality by 2012”, more concerted efforts
and structured activities are being carried out to implement built-in quality upstream at the early stage of a
vehicle’s design and development. Initiatives like benchmarking and simultaneous engineering, are some of
the defect prevention initiatives carried out.
84
25 STERLING YEARS
How this works is that all market feedback, especially customer complaints, are channeled back to the
design and development team so that they can act to prevent recurrence and also leverage on these new
findings to emerge improvements and countermeasures in the design of new models and facelifts.
The design and development process deliverables are also monitored to ensure strict adherence to PROTON’s
New Product Introduction requirements. All new models will be then subjected to various stages of
comprehensive and systematic quality gate reviews to track compliance against the set quality targets and
deliverables.
With all these pro-active initiatives done during the design and development stage, there have been noticeable
and meaningful improvements in the initial quality of PROTON vehicles as evidenced by the reduction in
customer complaints. The Exora, for example, has registered 68% improvement in concerns per car for the
first three months from the start of production.
This achievement clearly shows that the various initiatives PROTON have put in place and our emphasis on
prevention rather than detection has started to bear fruits.
Operations Review

85
25 STERLING YEARS
Quality in Supply Chain
As one of our critical success factors, our suppliers are required to implement various quality initiatives in
order to ensure good quality components are being produced and fitted into PROTON’s vehicles.
To ensure our supplier’s quality system and manufacturing processes are in controlled environments and in
compliance with the global quality automotive standard, all PROTON suppliers are subjected to stringent
year-round quality audits. All components are also rigorously inspected and tested at various points on
a continuous and periodical basis during the mass production stages so as to reflect PROTON’s endless
commitment towards quality.
During the year under review we established quality improvement action plans focusing on selected critical
suppliers, and special quality audits were carried-out with direct involvement of PROTON’s top management.
In addition, all newly developed components had to undergo and fulfill more than 15 requirements of the
production part approval process before being approved for supply to our factories and fitted into PROTON
vehicles.
With all these initiatives in place, the supplier quality level registered an improvement of more than 50%
during the period. Moving forward, more efforts in supplier’s capability building and enhancement of the
integrated supplier quality management programme have been identified as the next key areas of improvement
as we continue to adopt global best practices and put more focus in developing a quality culture throughout
the supply chain.
Operations Review
86 Quality in Manufacturing
Manufacturing, being one of the most important elements of quality, is always the main focus of our
25 STERLING YEARS
quality improvement initiatives. With various initiatives like QIT and Zero Defect program carried-out at the
production shopfloors, the quality level of vehicles have continued registering impressive improvement of
more than 50% in all plants.
Towards building-in quality into the manufacturing processes, efforts are being made to change our quality
approach from judgement control to source control by implementing initiative like Zero Quality Control to
eliminate defects by fixing the root cause and controlling the processes at source.The year-long continuous
quality campaign strategy via the implementation of the Zero Defect program has indeed helped improve
the quality level tremendously. By implementing the Zero Defect program, PROTON has ingrained a mindset
shift of ‘Nothing is Impossible’ and embedded a commitment towards defect prevention into our work
culture. This fulfills one of PROTON’s TQM emphasis on people quality.
Operations Review

87
25 STERLING YEARS
Quality in Market
PROTON’s never-ending commitment towards customer satisfaction is strongly reflected by the JD Power
Initial Quality Study 2009 (IQS) results. In the IQS 2009, PROTON recorded a 30% improvement rate in
comparison to the IQS 2008 result. The achievement is indeed significant because no other OEM companies
have ever achieved such results.
In addition, PROTON’s improvement rate surpassed the industry average which only registered 14%
improvement. The strong results clearly imply that PROTON is listening to our customers seriously and more
importantly, various actions are being implemented to relentlessly address all customers’ concerns, big and
small, to keep our customers satisfied.
During the year under review, PROTON models continued to gain market recognition via various established
international awards which are testament to the improved quality of PROTON models. Towards a future of
unrelenting progress, PROTON remains committed to exceed expectations and continuously embark on
various quality improvement initiatives so as to attain and maintain a world class standard of quality.
Operations Review
SALES & DISTRIBUTION

DOMESTIC MARKETS
THE FINANCIAL YEAR 2009/2010 HAS BEEN A CHALLENGING YET
88
EXCITING YEAR FOR PROTON. WE STARTED CAUTIOUSLY IN THE WAKE
OF THE DRASTIC MARKET SLOWDOWN DUE TO THE AFTERMATH OF THE
25 STERLING YEARS
2008 GLOBAL ECONOMIC CRISIS. THIS HAD SEVERELY AFFECTED THE

AUTOMOTIVE INDUSTRY BOTH DOMESTICALLY AND GLOBALLY. MARKET
ANALYSTS HAD ORIGINALLY FORECASTED A 11% DECLINE IN TOTAL
INDUSTRY VOLUME (TIV) GROWTH IN 2009 AS COMPARED TO 2008 DUE
TO THE EFFECT OF THE ECONOMIC DOWNTURN.
To combat the adverse market situation, we put together a series of aggressive initiatives to overcome
the challenges, and leveraged on opportunities provided by the Government economic stimulus
package. As the market gradually recovered, buoyed by the increase in consumer confidence and
positive economic health, we continued to heighten our collective efforts to drive higher sales.
The results were encouraging. With strong support from our network, PROTON not only managed to
surge in performance but also proudly secured the market leader position for 2 consecutive months
in June and July 2009 respectively. Group synergy and our employees passionate commitment to our
goals continued to steer us towards steady growth over the following months, and to our great delight,
we surpassed the target for the 2009/2010 financial year.
At the closure of the financial year under review, as at 31st March 2010, we posted a total of
157,170 unit registrations, 4% higher than the target and representing a 13% improvement over the
previous year’s performance of 139,394 units. Over the calendar year performance, while TIV posted
a decline of 2% (536,905 in 2009 against 548,115 in 2008), PROTON outgrew the industry’s rate
by increasing 4% (148,027) compared to 2008’s volume of 142,971.
Making
a Stronger
Impact
A New Dawn
for Sales &
Distribution
Operations Review
Effectively, PROTON gained an additional 2% market share, increasing to 28% from 26% in the previous
year. This marked improvement of 13% increase in overall performance was primarily driven by the popularity
of four core models namely the Saga, Persona, Exora and Satria Neo. These made up 94% of the total
registration.
The Saga continued to be the lead model amongst the top four PROTON models and had managed to become
the best selling model in Malaysia for 3 consecutive months from January 2010 to March 2010.
90 With better systems and improved processes in place, the overall monthly average of unregistered stock
against registered ratio remained healthy at below 1 month, resulting in better cash flow.
25 STERLING YEARS
The PROTON XChange Program, a scrapping scheme that was introduced in 2008 with the support of the
Malaysian Government to aid the automotive industry through its economic stimulus package, came to a
closure in the third quarter of the financial year under review, with more than 29,000 units scrapped, in
contrast to the original target of 5,000 units.
Service business performance posted a total revenue of RM259 million, an increase of 43% over the previous
year’s achievement of RM181 million. This represented a RM32 million increase above the target and, at
the same time, reflected an improvement in our Customer Service Index (CSI) score from 70 points in the
previous year, to 74 points during the period under review.
Operations Review

Significant Events
In the second quarter of the 2009/2010 financial year, Proton Edar Sdn. Bhd., a wholly-owned subsidiary, and
Edaran Otomobil Nasional Berhad (EON) jointly signed a Master Dealership Agreement in which both parties
are in consensus to re-align the Sales and Service dealer networks nationwide. This network rationalisation
programme sets to re-map the Dealer Networks to solidify and strengthen PROTON’s position in the market.
As at the end March 2010, the total number of outlets was reduced to 255 for sales and 339 for service
respectively.
91
25 STERLING YEARS
Center for
Logistic Allocation
Storage and Services
in Sijangkang.
We have also embarked on our Phase 1 Centralized Pre-Delivery and Logistics Hub Project for the Shah
Alam plant through an outsourced partner located at Sijangkang, Kelang, Selangor. This integrates vehicles
storage, Pre-Delivery Inspection (PDI), minor repair works and distribution preparation at a 1-stop centre
with an aim to reduce the handling points and achieve better stock management in order to improve the
delivery process to the end customers.
This mega project supports both the Domestic and Export markets and Phase 2 is in the pipeline for vehicle
production rolling out from the Tanjung Malim plant.
In terms of new product enhancements, the introduction of the Saga Special Edition in July 2009; with its
new special features and accessories, coupled with a sporty yet elegant look; helped to further boost the
popularity of the new Saga. In the MPV segment, the popular Exora received an additional new variant with
Exora Basic making its presence in November 2009 to offer customers a more affordable choice for the lower
end market. To date, the Exora has garnered an excess of 43,000 in total bookings and more than 32,000
units have been sold since its introduction in April 2009.
Operations Review
PROTON’s Managing Director,

Dato’ Haji Syed Zainal Abidin, and
92 CEO of Proton Edar Sdn. Bhd.,
Mohamad Shukor, at the launch
of the Persona Elegance.
25 STERLING YEARS
Persona meanwhile was given a refreshed styling and enhanced look with the introduction of the Persona
Elegance in March 2010. The new design has accelerated market excitement as evidenced by improved
bookings with registrations averaging 4,500 units three months after its launch.
During the financial year under review, PROTON models continued to gather a number of awards, among
them:
• The prestigious Best Brand in the Brand Laureate SMEs Masters Awards for the automotive category.
• The Exora, within the first 9 months of its market entry garnered 3 awards: Best Local Assembly MPV
(Asian Auto – VCA Auto Industry Awards 2009); Winner of Car of the Year 2009 Award for small/mid-size
MPV (Autocar Asean); and Car of the Year 2009 for midi MPV (NST/Maybank).
• The Persona and Savvy took 2nd Placing for the Most Fuel Efficient Car Award 2009 (Asian Auto Mudah.
com) under the category of Small Family Car and Compact City Car respectively
• The Satria Neo was voted the Best Local Assembly Sports Car by Asian Auto-VCA Auto Industry Awards
2009.
• The hot Saga meanwhile, continued its fine run with its fourth award, winning the Best Model of The Year
2009 (Frost & Sullivan Asia Pacific).
• As an overall brand, PROTON was awarded the Reader Digest “Most Trusted Brand Gold Award 2009”
for the 6th consecutive time since 2003.
Operations Review

Moving up the next level
Proton Edar believes that customer satisfaction is one of the key growth drivers for Proton vehicles in terms
of sales and after sales volumes. To move up our ranks in the customer satisfaction index, we have embarked
on an aggressive drive throughout the entire network for both sales and service outlets to strive for speedier
improvements. Proton Edar is targeting to be number 5 within the next 3 years and to be number 3 within
the next 5 years in the overall customer satisfaction index.
As we move into an era where customer expectations of new vehicles are higher, Proton Edar is actively raising 93
up our ante in order to satisfy our customers’ demands. To continue attracting interest and realise improved
sales of Proton cars, we increased our segment focus to enable offers of improved packages, enhance
25 STERLING YEARS
customers experience at all touch points and strengthen our integrated marketing approach between car
sales and after-sales service.
In addition, improved efforts are pursued to expand revenue growth and margin significantly from the after-
sales and spare parts business specifically while running continuous programs and scheme to increase the
network overall effectiveness.
Beyond this, Proton Edar is spearheading a corporate image enhancement exercise for all the Sales and
Service Outlets to improve the display and appearance of our showrooms and facilities.
Our passion and dedication towards maintaining outstanding performance even amidst a global slowdown is
fueled by our successful performance during the period under review. As we look ahead towards a new financial
year, Proton Edar is ready and geared up to deliver a new dawn for the domestic market. Notwithstanding
the challenges ahead, we aim for improved performances in every operational and business segment as we
continue to put strong emphasis on customer satisfaction as our yardstick for further growth and success.
Operations Review
94
25 STERLING YEARS
EXPORT MARKETS
THE IMPACT OF THE GLOBAL ECONOMIC SLOWDOWN CHALLENGED THE
GLOBAL AUTOMOTIVE MARKET TO BECOME STRONGER AND TOUGHER.
INTENSE COMPETITION CONTINUED TO BE A BIG HURDLE FOR PROTON’S
DISTRIBUTORS, PARTICULARLY IN THE UNITED KINGDOM, AUSTRALIA
AND THE MIDDLE-EAST REGION.
NOTWITHSTANDING THIS, CHINA CONTINUED TO RECORD SIGNIFICANT
GROWTH FROM THE PREVIOUS YEARS AND THE FISCAL YEAR SAW THE
COUNTRY TAKING THE LEAD AS THE WORLD’S BIGGEST AUTOMOTIVE
MARKET. IN ASEAN, CUSTOMERS WERE SPOILT FOR CHOICE WITH THE
OVERWHELMING INTRODUCTION OF NEW MODELS.
Operations Review

Performance and Operations
The year under review saw PROTON strengthening its export foundation, picking up the pace of sales and
registering improved performance, both in terms of export volume and financials. Aligning to the Group’s
strategy, our export goals were to implement country-specific business concepts, develop products based
on key market requirements, strengthen the PROTON brand, position PROTON competitively and provide
support to the international supply-chain establishment.
The commencement of Completely Knocked Down (CKD) Production of the Gen.2 and Persona in China is 95
evidence of the revived implementation of PROTON exports. Through a strong collaboration with Youngman
Automobile Group, in capitalising the tax benefits of local productions, PROTON is on track in its efforts
25 STERLING YEARS
to leverage on competitive component sourcing in China. To-date, three Youngman plants are in operation
whilst PROTON’s Hangzhou Representative Office has been established with operations commencing in
December 2009.
The introduction of the Exora in ASEAN, resulted in an overwhelming response, especially during the initial
launch periods at the Indonesia International Motor Show 2009 and Bangkok Auto Expo 2009 respectively.
During these launch periods, PROTON recorded higher sales bookings compared to other established brands.
Down under, Proton Cars Australia had initiated the Sales Growth Program to expand network coverage and
capitalise on price-sensitive markets. This programme was spearheaded with the introduction of the the
Saga 1.6 (marketed as S16), recruitment of new dealers and brand-engagement programs with the Wests
Tigers Rugby League Football team, Miss Universe Australia pageant and Safe Drive Training program for
school students.
The fiscal year also saw PROTON entering the Yemen market, as well as conducting a series of one-off fleet sales
to Eastern Europe and Africa. These reflect our efforts in optimising the increased sales potential in existing
regions e.g. The Middle East and Gulf Countries; as well as capturing new markets for future introductions.
5-year Export Volume and 2010/11 Forecast
50000
40000 • The major contributors to the

increased exports for FY2009/10
were China, Thailand, Indonesia,
30000 Australia and Egypt.
• The volume growth projection in

20000 FY2010/11 relies on incremental
CKD Operations in China.
10000
0
‘05/06 ‘06/07 ‘07/08 ‘08/09 ‘09/10 AMP10/11
Operations Review
Prospects
Moving forward, in order to achieve the Group’s growing focus on overseas markets, the Export Division has
prioritised the following key areas.
Volume and financials: Improving the Product and Market Mix, strengthening the Completely Knocked Down
(CKD) business in China and pursuing an effective control mechanism on operating expenditure.
96 Markets: Stabilising Completely Built Up (CBU) sales in existing markets; meanwhile for the CKD markets,
Export Division is to support and further strengthen the CKD Operations in China, review the business model
implementation in Iran and finalise the entry strategy into India.
25 STERLING YEARS
Marketing, product and price: To initiate a strategic concept for global benchmarking and implement brand
improvement initiatives.
Dealer network: Emphasise on “Delivery to Customer” through customer satisfaction improvement (CSI) and
customer relationship management (CRM) programs, as well as focus on dealer management training and
after-sales service operations.
Organisation: Continue to enhance our personnel skills and dealer workforce through coaching and customised
training programs.
Whilst the focus on key export regions remain, Export Division will continue to pursue the Global Benchmarking
exercise that will eventually enrich the PROTON brand values and improve profitability to the Group and
respective stakeholders. The initial phase will focus on Product positioning realignment, after-sales service,
dealer development and management, marketing and effective organisation. The success of these initiatives
shall push export operations closer to the long-term Group objectives.
Operations Review

CHINA
Overview
In 2009 China surpassed the United States as the world’s largest automotive market with 13.6 million
vehicles sold. The growth was mainly powered by favorable government incentives and China’s stimulus
package to boost the economy amidst the global financial crisis in 2009.
97
Operations
25 STERLING YEARS
During the year under review, PROTON’s business arrangement with China-based Jinhua Youngman
Automobile Group (“Youngman”) has developed from CBU into CKD to capitalise on the tax savings for
locally manufactured vehicles and leveraging on China lower cost base for manufacturing and components
sourcing.
Youngman’s plants in Anshun, Jinan and Tai An have been operational since 2009 with Hangzhou plant
scheduled for completion end 2010.
To accelerate PROTON’s strategy into China and serve the market better, PROTON has set up a Representative
Office in Hangzhou, Zhejiang Province which has been in operations since Dec 2009.
Currently, PROTON cars are being sold under the Europestar brand through 100 appointed dealers throughout
China.
PROTON Managing Director Dato’ Haji Syed Zainal Abidin Syed Mohamed Tahir visits
Youngman’s car assembly plant in Tai-an.
Operations Review
THAILAND
Overview
Thailand’s automotive industry in 2009 showed a significant drop of 10.7% when compared to 2008 due to
the global economic crunch and domestic political instability. Thailand’s 6 months long deflationary episode
ended in October 2009 and inflationary pressures are set to accelerate slightly during 2010. Politically, the
98 ruling government made the headlines again with a court ruling to seize a sizeable part of ousted former
Prime Minister, Thaksin Shinawatra’s frozen funds which sparked off a burning trail of aggressive protests.
Despite this turbulent background, PROTON continued to make headway in the Thai market with a package of
25 STERLING YEARS
practical designs at affordable prices. The Proton Exora offered through our exclusive distributor; Phranakorn
Auto Sales (PAS), was a popular new introduction and helped boost PROTON sales for the fiscal year. Currently,
through PAS, we have a dealer network of 36 3S outlets throughout Thailand that offer 6 attractive models
targetting different consumers. The models comprise Savvy, Neo, Neo CPS, Gen.2, Persona and Exora.
Prospects
To combat the negative climate, the Thai government has implemented 2 stimulus
programmes to boost economic growth. Under this “Thai Khem Khang” or “Stronger Thai
2012” project, the government hopes to improve Thailand’s economy by 3% from 2010
onwards, which hopefully could fuel an increase in new vehicle sales, especially in the
commercial segment.
For the automotive industry, the Thai government introduced a number of measures to
encourage both the production and the domestic sales of more environmentally friendly
vehicles, including the promotion of biofuels. The eco car project was on stream with the 1st
CKD eco car officially launched by Nissan during the March 2010 Motor Show.
The recovery in the automotive industry for 2010 was also spurred by the reduction
in Common Effective Preferential Tariff (CEPT) rates from the current 5% to
0% for CBU imports from ASEAN countries, effective Jan 2010 onwards. This
indicates an increase in CBU imports from ASEAN countries. With this, many
non-ASEAN brands will also be considering setting up assembly outfits or partnerships in
ASEAN countries to capitalise on the 0% CEPT concessions between Malaysia-Indonesia-
Thailand. However, this positive growth projection is still being reviewed due to the domestic
political crisis.
Prior to the political crisis, Thailand’s Automotive Industry was forecasted to recover in 2010
with the improvement in the economy and availability of newer models slated to be launched
in 2010 by many brands. However, the Thai automotive market will also see some vibrancy
and more competitive selling by various brands to capture sales as well as to defend market
share, post crisis. This will likely improve the overall TIV in Thailand.
Operations Review

Launch of Proton Exora
in Thailand. 99
25 STERLING YEARS
Operations and Performance
Within a short span of 2 years, PROTON has established itself as one of the top 10 players in the passenger
cars segment capturing the 8th and 10th position in terms of overall TIV in the Thailand automotive market
for 2009.
In December 2009, PROTON introduced the Exora during the 26th Thailand International Motor Expo 2009.
During the 13 days event, PROTON surpassed the bookings record of 1,008 units achieved in 2007 when
we first entered the market, with an achievement of 1,388 units and was positioned 6th in the overall Motor
Expo booking. The Exora received 825 units booking which is equivalent to almost 10% of the share of the
MPV segment, surpassing Honda Freed in bookings.
Overall, for the financial year ended 31 March 2010, PROTON achieved a remarkable result with 4,493
units exported to Thailand which exceeded the target of 3,091 units. In terms of retail sales, PROTON sold
4,108 units representing a 41% increase against the target of 2,913 units. Total sales revenue improved
correspondingly with RM 208.6 million, a 68% increase against the target of RM 123.9 million.
Operations Review
INDONESIA
Overview
PT Proton Edar Indonesia (PT PEI) was established on 16 August, 2002 but commenced full operations on
16 March 2007, as part of PROTON’s Brand expansion and Asian Multi-Local OEM (AMLO) strategies to
spread out its presence intensely and dynamically.
100 PT PEI, till the end of 2009 offered the Indonesian market 7 attractive models, to target the different
segments. The models are:
25 STERLING YEARS
• the Savvy, launched in July 2007, which received 2 Awards for Best City Car from Majalah Mobil Motor
and Auto Bild Indonesia;
• the Gen.2 and Neo (also launched in 2007), with the more sporty and stylish outlook within the hatchback
categories;
• the Persona, and Waja (launched in July 2007) which are highly comfortable and functional mini sedans;
and
• the Saga (launched in March 2009).
The year in review saw the launch of the Gen.2 facelift and the first ever PROTON MPV; the Exora. In a
country where there is a large preference for MPVs, the PROTON Exora gathered the most accolades. This
model has become the biggest sales contributor to PT PEI since its launch and debut at the 17th Indonesian
International MotorShow on 24th July, 2009.
On the dealer network aspect, PT PEI had appointed 18 sales outlets and 32 after sales service centres/
authorised workshops throughout Indonesia.
Performance
PROTON has established itself as the 15th top brand in the Indonesian automotive market; just below
Mazda, Chevrolet and Hyundai.
The Association of Indonesian Automotive Industries (Gaikindo) estimated for the year 2009 that the
Indonesian automotive market would have fallen by 20% of the total industry volume (TIV). Despite that,
as per fiscal year ended 31 March 2010, PROTON had managed to sell 2,557 units; a staggering increase
of 134% in comparison to the previous fiscal year’s sales volume of 1,092 units. Total sales revenue also
improved correspondingly from IDR104.7 Billion to IDR 281.7 Billion.
As such, PROTON has emerged as one of the automotive brands in Indonesia with the biggest positive growth
rate in 2009, while most automotive brands suffered significant decrease in their sales volume in comparison
to 2008. Furthermore, PROTON’s sharp increase in sales growth has increased PROTON’s market share from
0.2% to 0.4% for the same year.
The Exora and Persona turned out to be the two biggest volume contributors to the 2009 sales volumes.
With 972 units and 534 units sold respectively for the year, these two products have become PT PEI’s core
products.
Operations Review

101
25 STERLING YEARS
Prospects
Indonesia had last year sustained its economic status from the early 2009 global economic
crisis and its stable economic condition is expected to continue in the new calendar year.
PT PEI is taking advantage of the situation and is embarking aggressively on expanding its
network as well as prospecting intensively on corporate and fleet sales.
Growing market confidence in PROTON has enabled PT PEI to garner strong support and
cooperation from several leading finance and banking institutions. This confidence has
also greatly stimulated interest from the car rental and public transport sectors throughout
Indonesia which in turn assists in increasing PROTON’s resale value to the market. With
the current outlook & barring any unforeseen circumstances, PT PEI is expected to perform
better in the new fiscal year.
Operations Review
SINGAPORE
Performance and Operations
Registration of new passenger cars in Singapore in 2009 dropped by 28,486 units or 29.6% as compared to
that in 2008 which was a direct result of a reduction in supply of COEs (Certificate of Entitlement).
102 In this adverse condition, Proton Singapore managed to outperform the market with a reduction in sales of
only 13.23% which was mainly due to the new Proton Exora.
To maximise cost effectiveness, operations such as Administration and PDI have been relocated and
25 STERLING YEARS
consolidated as part of Proton Singapore’s overall re-structuring and cost saving measures.
Further, new marketing strategies have been implemented and partnerships with reputable local companies
have been developed to enhance the awareness and image of PROTON in Singapore.
Prospects
Market conditions in 2010 continue to be very difficult as the COE quota is expected to be further reduced by
around 39%. In response, Proton Singapore has already trimmed the size of its operations and is now focusing
on the implementation of an aggressive marketing and sales plan with an eye on improving productivity at all
levels to ensure Proton Singapore is primed and ready when the market improves.
UNITED KINGDOM
Overview
As expected 2009 was a very difficult year for the UK Automotive Industry with manufacturers having to
fight for every sale. This in turn led to unpredicted levels of retail incentives with manufacturer’s subsidised
finance being the most effective tool as consumers found normal credit difficult to obtain.
After a very bad start to the year, total industry volume (TIV) eventually ended at 1,995,000 vehicles which
was down 7% from 2008. However, had it not been for the introduction of a Government backed scrappage
scheme for cars 10 years and older, which added 300,000 sales, the reduction would have been far worse.
The difficult economic situation also drove sales of smaller A and B segment cars which both gained market
share while all other segments shrunk. This in turn led to increased sales of sub 1.2 petrol engines and sub
1.6 diesel engines, lowering average CO2 emissions by 5% over the previous year. The market also saw a
definite trend towards smaller cars that were well equipped and economical to run, but still had larger car
characteristics and comfort levels.
Operations Review

103
25 STERLING YEARS
Performance & Operations
Foreseeing a difficult year in 2009, Proton Cars (UK) Ltd’s management put in place a number of initiatives
including significant cost savings, reorganised resource and resource levels, the introduction of improved
operational efficiencies and other effective measures. Sales volume and financial targets for 2009 were set
at realistic levels to reflect the expected tough market conditions and minimise risk levels given the volatile
economical scenario.
Therefore we are pleased to report that we managed to successfully achieve all our initiatives and cost
saving measures, whilst maintaining high levels of support and customer satisfaction for which PROTON is
known for in the UK. We surpassed our 2009 sales volume targets by about 20% and this resulted in better
financial performance for Proton Cars (UK) Ltd.
Prospects
Another difficult year is forecast in 2010, with the new car market expected to record only about 1,800,000
units. On a brighter note, the general economic conditions for 2010 are set to improve with strengthening
currency and a much stronger new car market predicted towards the end of the year and into 2011. Proton
Cars (UK) Ltd plans to continue the strategic initiatives and measures introduced in 2009 to deliver continued
improvements.
Operations Review
AUSTRALIA
Overview
In 2009 the Australian automotive industry, like other markets around the world, was severely affected by
the global financial crisis. Total industry volume was down 7.4% compared to 2008. However this figure was
mitigated by government stimulus measures introduced earlier in the year. In the early months, prior to the
104 stimulus assistance, the rate of decline was greater than 17%.
PROTON in Australia was in the process of a dealer rationalisation program during this period and as such
was adversely affected by the availability of credit facilities in the area of dealer financing. Despite this,
25 STERLING YEARS
Proton Cars Australia was able to recruit nine new dealers across the country in preparation for the launch
and expected growth associated with the launch of the Saga, known as S16 in Australia.
The introduction of Chinese and Indian manufactured vehicles had also increased competition and the drop
in customs duty from 1 January 2010 has seen prices in the market fall slightly. The outlook is for prices to
hold at current levels as market conditions improve; resulting in an increase in the overall industry volume.
Operations
The early part of 2009 involved the induction of new dealers as the business prepared for the launch of
several new models spearheaded by the S16. Although PROTON’s volume was down 25% in the period
between April to October 2009, the launch of S16 in December resulted in an increase of 118% for
the November 2009 to March 2010 sales period. Overall volume was up 17% for the full 2009/10
financial year.
Proton Australia continued with its sponsorship of the Wests Tigers Rugby League Football team, with over
400,000 people attending matches live during the season and an estimated 14.2 million watching games
on television.
Proton Australia also continued its association with the Miss Universe Australia pageant. The newly-crowned
Miss Universe Australia, Rachael Finch, acted as ambassador for the S16 and was featured in all its
advertising and promotions.
The Safe Drive Training program also continued to enjoy our support and is responsible for the training of
school students throughout New South Wales and Queensland.
Performance for the Financial Year

Overall, our sales result improved despite lower volumes in the first two quarters. Total retail sales volume
for the year was 1,954 units – an increase of 17% over the last financial year. Our constant drive towards
overhead reduction, through efficiencies implemented in the supply chain process, continue to yield financial
benefits as volume continues to grow.
Operations Review

105
25 STERLING YEARS
Ms. Universe Australia, Rachel Finch, unveiling the S16 together with PROTON Cars Australia Pty Ltd’s Managing Director,
John Startari, during the Australian National Dealer Conference in Kuala Lumpur.
Prospects
Proton Australia is bullish in its outlook for the coming financial year. Volume is forecast to continue growing
on the back of continued success of the S16 and the introduction of new models in the fourth quarter. Our
current dealer network is expected to grow to 45 dealers nationally by the end of 2010 providing sufficient
representation to service the forecast growth in unit sales.
With our dealer rationalisation programme and cost efficient initiatives in place, the platform has now
been laid for future profitable growth that will ensure Proton Australia remains a viable operation in the
years ahead.
Operations Review
PROTON AND MOTORSPORTS

MOTORSPORTS IS PROTON’S KEY STRATEGY FOR A DYNAMIC SHOWCASE
FOR PROTON’S BRAND, PRODUCTS AND TECHNOLOGY. IT SUPPORTS
106 PROTON’S AMBITION IN ESTABLISHING THE BRAND GLOBALLY THROUGH
A GROWING BASE OF FANS WORLDWIDE.
25 STERLING YEARS
R3, PROTON’s motorsports division, pioneers the research, development and production of race cars,
PROTON’s performance parts and special edition high performance PROTON vehicles that are inspired
by Motorsports participation and technology. The term R3 stands for Race, Rally, Research.
PROTON’s involvement in motorsports is largely through participation of the PROTON R3 Malaysia
Rally Team in the Asia Pacific Rally Championship (APRC) and Intercontinental Rally Challenge (IRC)
spanning Asia Pacific and Europe in countries such as Malaysia, Japan, New Zealand, Australia,
Indonesia, China, Belgium, Czech Republic and Scotland. PROTON features the Satria Neo S2000 in
these rallies, a car that is the result of a combination of innovative engineering designs as approved
by FIA under the S2000 regulations. Its wealth of technical advances and design has resulted in a
combination of performance and reliability.
Gaining
Global
Renown
A New Dawn
for
Motorsports
Operations Review
Carrying the Malaysian flag in international rallying are world renowned drivers, Alister McRae and Chris
Atkinson. Alister McRae has been involved in motorsports for the past 16 years, participating in more than
80 World Rally Championship (WRC) events while Chris Atkinson is a hugely popular rally driver with notable
achievements as a World Rally Car driver.
PROTON has had a colourful journey into rally motorsports worldwide. The Satria Neo S2000 made its debut
in the IRC in 2009, and enjoyed a commendable season, finishing consistently in the top 10 positions in six
rounds of the championship against more established manufacturer teams the likes of Peugeot, Skoda, Fiat,
108 Subaru and Mitsubishi. The team’s best finish was a second placing at the Rally of Scotland and finishing
fourth in the Rally of Russia. PROTON had also participated in three rounds of the coveted APRC in 2009.
The PROTON R3 Malaysia Rally Team is the only Malaysian team represented in the IRC and PROTON is
25 STERLING YEARS
also proud to represent Malaysia once again in the APRC.

Operations Review

109
25 STERLING YEARS
In 2010, PROTON’s Motorsports division also embarked into sponsorship with the Lotus Racing team to
further expand global branding activities. PROTON currently participates in the elite single-seater motor
racing, Formula One.
Participation in motorsports is beneficial to the Company in terms of research, development and technology
transfer. After every race, data and experience gained from the track is analysed and implemented into the
development of PROTON’s road cars and performance parts.
Not limited to the above, it has been proven that motorsports is indeed a powerful brand building platform
for PROTON. The Company believes that every victory or milestone achieved on the track is the foundation
of redefining the limits of true racing performance.
Operations Review
PROPERTIES
THOUGH THE PROPERTY MARKET WAS WEAKENED BY THE
GLOBAL ECONOMIC SLOWDOWN IN THE FINANCIAL YEAR, PROTON
110 CONTINUED TO SUCCESSFULLY DISPOSE NON-CORE ASSETS.
25 STERLING YEARS
Sixteen medium cost apartments and two 3-storey shop/offices in Taman Seri Proton, Klang were sold
during the year under review by Proton Properties Sdn. Bhd.
PROTON’s manufacturing plants in Shah Alam and Glenmarie, in Selangor and Tanjong Malim in
Perak, make up the Group’s main manufacturing assets todate. These are built on a total area of
602.5 hectares of land. Other assets comprise the PROTON Centre of Excellence in Subang Jaya and
numerous 3S centres nationwide.
During the year under review, most of the Group’s 3S Centres underwent a corporate identity
improvement exercise – an investment that continues into the current financial year.
PROTON’s properties were also made available for rental and in July 2009, Universiti Pendidikan
Sultan Idris (UPSI) started utilising Level 1 of the new administrative building in Tanjong Malim as
their lecture rooms and classes. As testament to the quality and good condition of the building, UPSI
had in March 2010 confirmed leasing additional floor space from July 2010 onwards.
On the development front, Proton City Development Corporation Sdn. Bhd. (PCDC), a 40% owned
associate company, has been involved in developing Proton City in Tanjung Malim. Planned with
modern infrastructures, recreational parks and rich landscaping, these features have become key
attractions to buyers of residential units in Proton City. Due to the global economic slowdown, PCDC
has not launched any phase for development. However, in the last fiscal year, it took the opportunity
to carry out further studies and assessment of past projects in order to enhance its current plans and
prepare for future projects and launches.
Streamlining
our Focus
A New Dawn
for Properties
Operations Review
FINANCIAL SERVICES
PROTON COMMERCE SDN. BHD. (PCSB) IS A JOINT VENTURE COMPANY
BETWEEN PROTON EDAR SDN. BHD. AND CIMB BANK BERHAD, WHICH
112 ENABLES PROTON TO PROVIDE QUALITY FINANCING SERVICES TO
OUR CUSTOMERS. PCSB OFFERS COMPETITIVE HIRE PURCHASE LOAN
25 STERLING YEARS
FINANCING PACKAGES TO NEW PROTON CAR PURCHASERS THROUGH

THE PROTON EDAR SDN. BHD. AND EDARAN OTOMOBIL NASIONAL
BERHAD SALES NETWORKS NATIONWIDE.
Customers not only enjoy better deals for car financing but also value-added packages that offer a
combination of other financial products.
Backed by the expertise and reliability of two established parent companies, the PROTON Group is
committed to delivering competitive hire purchase packages that prioritises providing fast, efficient
and friendly service to our car buyers. By doing this, it is our aim to become the preferred automotive
finance provider for the purchase of new PROTON vehicles, while being recognised as a competitive
and capable player in the local automotive financing industry.
At the same time, PROTON also holds a 49.9% equity stake in Lotus Finance Limited, and a 49.99%
stake in Proton Finance Limited, both of which are companies incorporated in the United Kingdom.
Proton Finance Limited provides a range of hire purchase and finance lease options in connection with
the financing of Proton cars, whilst Lotus Finance Limited provides the same facilities for new and used
Lotus vehicles.
Enhancing
Efficiency
and Value
A New Dawn
in Financial
Services
Operations Review
CORPORATE SOCIAL RESPONSIBILITY

BEYOND THE PROFITABILITY OF OUR BUSINESS VENTURES, PROTON
BELIEVES THAT COMMITMENT AND CARE MUST BE INVESTED IN
114 CREATING A SUSTAINABLE BUSINESS THAT BENEFITS OUR PEOPLE,
THE ENVIRONMENT, AND SOCIETY AT LARGE. THE GROUP HAS MADE
25 STERLING YEARS
CONTINUOUS STRIDES TO POSITIVELY IMPACT THE MARKETPLACE,

WORKPLACE, COMMUNITY AND ENVIRONMENT BY PLAYING A DEDICATED
ROLE AS A SOCIALLY RESPONSIBLE CORPORATION.
In carrying out our corporate social responsibility (CSR) initiatives, the Group aims to achieve several
broad objectives which will meet the expectations of good corporate governance, ethical corporate
values and responsible corporate citizenry. It is also important that we advocate a corporate culture
that appreciates the value of social service and understands its impact on stakeholders as a whole.
At PROTON, we divide our CSR initiatives into four main segments: marketplace, workplace, community
and environment.
Creating
a Positive
Difference
A New Dawn
in Corporate
Social
Responsibility
Operations Review
Marketplace
Our Marketplace CSR initiative is defined as all business activities related to the commercial or business
interaction between PROTON and its stakeholders, be it the shareholder, customer or supplier. It involves,
among others, adherence to ethical business practices, quality management, attention to product safety,
compliance to regulations and vendor development.
Maintaining customer satisfaction is at the forefront of our business management, and we are continuously
116 improving our efforts in cultivating a good and strong relationship with our customers to improve their
satisfaction levels. A major concern among PROTON stakeholders is quality, and to address this, the Group
has made numerous efforts to improve the quality of our products to much success. This can be seen in our
25 STERLING YEARS
2009 JD Power Initial Quality Study (IQS), which recorded a 30 percent improvement rate in comparison to
the previous year’s results. This improvement rate surpassed the industry’s average, which only registered a
14 percent improvement.
Operations Review

To enhance our after-sales service, customer surveys specifically tailored to PROTON’s
business operations are regularly conducted to monitor customer satisfaction. Information
obtained from the surveys are analysed and incorporated into our product and service
developments, sales, and customer care activities to ensure that the customers’ experience
with PROTON is always a positive one.
We continue to elevate the standards of our customer service system, PROTON i-Care, with
emphasis on the importance of creating the best value for our customers. Staff members of
i-Care are trained to ensure that customers who make contact via the Call Centre experience
117
a smooth procedure, from receiving technical advice to those requesting assistance for a car
breakdown.
25 STERLING YEARS
On an internal level, and to better understand customers’ needs, PROTON employees are
also regularly encouraged to evaluate this process via surveys in an effort to improve the
quality and speed of our response to customers.
Operations Review
At PROTON, we align ourselves with global safety standards – most prominently the European Safety
Standard as well as the Australian Design Rule (ADR) and Saudi Arabian Standards Organisation (SASO)/
Gulf Standards – and we are committed to the continual improvement of these standards. To ensure that
compliance is met across the board, all our safety requirements are 20 to 30 percent more stringent than
benchmarked figures.
In the case of product malfunction, PROTON acts promptly to minimise any adverse effects to its customers,
118 and mobilise the respective divisions to provide an immediate response. In critical cases where customer
safety has been compromised, we would assess the scope of damage and conduct a thorough investigation
on the cause of the incident.
25 STERLING YEARS
Additionally, we continuously strive to build solid and productive partnerships with our suppliers through
means of fair trading, in compliance with procurement-related policies, laws and regulations. As such,
PROTON constantly monitors the performance of suppliers with on-going quality audits – and if need be,
suggests improvements and provides guidance.
Last but not least, we take controlled measures to ensure that goods and services procured conform to the
Group’s policies, taking into consideration the suppliers’ manufacturing sites, management systems and the
state of their operations. All of our suppliers’ efficiency and productivity levels are also supported through
the Improve, Control and Educate (ICE) initiative to emphasise sustainability of supply capacity and training,
and this is closely monitored via extensive reviews and follow-up visits.
PROTON also provides technical support for small- and medium-sized suppliers to enable them to gain access
to the Automotive Development Fund which was established by the Government. To date, approximately
RM81.6 million has been disbursed.
Operations Review

Workplace
At PROTON, we recognise that a talented, productive human capital represents the backbone of our on-going
119
development and progress.
25 STERLING YEARS
Our Workplace CSR not only intends to provide our employees with optimum working conditions, as evidenced
by the Group’s safety and health policies, training exercises and other benefits to safeguard each one’s
welfare, we also ensure that their skills and talents are nurtured as this cohesively, this will further enhance
PROTON’s competitive advantage in the industry.
While it is important to ensure that we are able to grow as one seamless entity, this must also go hand in hand
with the development and retention of qualified leaders. Through the Group’s Human Capital initiatives, we
developed key members of our workforce by using PROTON’s Core and Leadership Competency Model. For
those who are keen to advance along the technical career track, a similar approach is applied, that is via
the Technical & Functional Competency Model. By using these competency models, our Talent Management
Programme has enhanced PROTON’s ability to identify, develop, and retain critical skills and talents,
especially for positions that play a critical role in delivering business and strategic growth.
Operations Review
Maintaining open communications between employees and management is also vital. PROTON has
implemented a range of initiatives specifically designed to encourage such communication, so that there
are no communication barriers in order for employees to achieve their full potential and progress within
the group. Initiatives include disclosing key performance indices, shared assessments, personnel system
reforms and streamlining the scheme of service throughout the Group. For instance, we conducted several
‘teh tarik sessions’ or informal get-togethers as well as engagement sessions with representatives from
various divisions/departments, including a select group of non-executives. The use of internal channels
120 such as PROTONCOM to disseminate information updates and policies is another effort to foster constant
engagement and encourage internal communication.
Apart from that, in meeting with the Government’s major push in the areas of human capital development,
25 STERLING YEARS
PROTON has proactively embarked and expanded on its Knowledge Management activities. A full fledged
Knowledge Management portal dubbed “ASPIRE” is now available across the organisation containing a
total of 100,000 knowledge assets and is growing by 500 assets a week. This is testament to the interest
and widespread acceptance of PROTON staff towards the new knowledge economy. PROTON’s plans for the
future is to build key communities of practices, where platforms of knowledge collaboration and sharing
will be provided for the general staff to expand and build on niche knowledge areas that are key in making
PROTON a competitive player in the ever challenging global market. The involvement from the respective
business units across the group, representing all divisions, is further supported by the identification of
approximately 20 staff members as Knowledge Officers.
Operations Review

121
25 STERLING YEARS
To further strengthen PROTON’s learning capability, we implemented the PROTON Development Framework
which includes the Centre of Manufacturing Excellence, Centre of Knowledge Excellence, and Centre of
Human Capital Excellence. In essence, this initiative promotes a strong knowledge culture by encouraging
continuous learning through various training programmes. From April 2009 to March 2010, our Learning &
Development department has provided training to a total of 6,836 participants via 294 courses.
The Learning and Development department has also embarked on several collaborative projects with selected
higher educational institutions and ministries such as the Ministry of Higher Education and Ministry of Rural
and Regional Development. Initiatives and plans are also actively being carried out to realise the setting
up of the PROTON Corporate University. A task force consisting of representatives from various divisions
has been identified and given the responsibility to carry out the related tasks. Under the PROTON Trainers
Development Programme – in collaboration with the Malaysian Institute of Management (MIM), PROTON
had identified 11 qualified staff members as MIM-Certified Professional Trainers whom had completed
their Level 3 competency. The ‘SIFU’ (meaning mentor, counsellor or teacher) Programme sees 13 of our
supervisors, team leaders and new executives being trained to become a ‘SIFU’ to the others. Currently,
there are 197 in-house trainers who are Subject Matter Experts registered with the Learning & Development
Department. By 2012, it is our aspiration that PROTON will be self sufficient in terms of trainer resources
for all the training needs of the organisation, with minimal dependency on external training providers.
To further complement this, the Group organised numerous health talks, carnivals, exhibitions and
programmes throughout the year to create awareness amongst employees on adopting a safe and healthy
lifestyle. Steering and working committees were established to allow for more effective monitoring of health
and safety related issues throughout PROTON’s Group of companies.
Operations Review
To strengthen the relationship between the Group Human Resources (GHR) Division and internal customers,
GHR had organised activities such the HR Week, Turun Padang Sehati Sepakat (engagement sessions between
Group Human Resource Director and selected executives from the Manufacturing Division), career planning
workshops and HR Talks/Briefings. The HR Week itself attracted more than 1300 employees attending the
3-day event organised in July 2009.
Active participation in Career Days held at various universities and locations also resulted in the hiring of
122 at least 75% of the new Executive population, whereas 25% were sourced via the Graduate Employability
Scheme (GEMS); initiated by Khazanah Nasional Berhad and also the Graduate Program 500 (GP500);
initiated by Bank Negara Malaysia.
25 STERLING YEARS
In supporting Khazanah Nasional Berhad – as part of The Orange Book initiative in Strengthening Leadership
Development – PROTON also participated in programmes such as the Cross Assignment between Government
Linked Companies (GLCs), Cross Fertilization between GLCs and Government Offices/Ministries as well as
the Accelerated Development Program (ADP) which includes Mentoring
Visitors throng PROTON’s Career Day.

Operations Review

Participants of Yayasan
PROTON teambuilding
event at Awana Resort, 123
Genting Highlands.
25 STERLING YEARS
COMMUNITY
Community CSR is an integral part of the Group’s interaction with the general public, and focuses on
philanthropic activities and donations to orphanages, the young, NGOs and various other special interest
groups.
YAYASAN PROTON had carried out several educational initiatives during the year. In December 2009,
10 scholars from universities around the country received scholarships from YAYASAN PROTON at the
Scholarship Award Ceremony. At the same event, representatives from YAYASAN PROTON’s “Adopted School
Programme” were also presented with cheques for the financial assistance pledged. These ‘Adopted’ schools,
located in Shah Alam and Tanjung Malim, require financial support for educational activities in the form of
tuition classes and motivational seminars, among others.
YAYASAN PROTON scholars also participated in the Annual Teambuilding and get-together activity held in
April 2010 at the Awana Resort in Genting Highlands. The event was held concurrently with the 21st Board
of Governors meeting, where the scholars were given the opportunity to engage in discussion with the Board
of Governors, the Managing Director and several management team members.
In the same month, YAYASAN PROTON contributed RM30,000 towards the Tabung Pendidikan PROTON.
PROTON is committed to promoting the nation’s socio-economic development. A major initiative under this
platform is PROTON’s involvement in the “Pintar Programme” which began in 2007, and involves other
Government-Linked Companies. The three-year programme is spearheaded by Khazanah Nasional Berhad
and involves an allocation of RM250,000 from PROTON.
Operations Review
124
25 STERLING YEARS
PROTON adopted four schools – three

primary schools and one secondary school
with a total number of 3,200 students - under
the “Pintar Programme”. The four schools
are Sekolah Rendah Kebangsaan Bagan
Tuan Kechil in Butterworth, Pulau Pinang;
Sekolah Menengah Kebangsaan Paya Keladi
in Kepala Batas, Pulau Pinang; Sekolah
Rendah Kebangsaan Tanjung Malim, Perak;
and Sekolah Rendah Kebangsaan Pintu Gang
in Paloh, Kelantan. Throughout the duration,
a host of structured activities were held to
assist students from these schools, many
of whom were from low-income families, to
improve their academic performance and
develop positive characteristics.
Operations Review

In the year under review, 32 activities were
held involving these schools. The activities
included weekly tuition classes, motivational
forums and camps, English language 125
camps, leadership camps and coaching for
students sitting for major examinations. In
25 STERLING YEARS
February 2010, PROTON held a Creativity
and Innovation competition for these Pintar
students in an effort to help them enhance
their creativity level, and master scientific
and technological concepts through hands-on
investigation and exploration as a team. Other
recreational activities held for these students
included football and badminton clinics held in
collaboration with the Badminton Association
of Malaysia (BAM), and the PROTON Football Flag off for the Merdeka Convoy.
Club. Additionally, PROTON also presented
incentives to impoverished, high-achieving
students in the form of cash and kind.
During the month of Ramadhan, the PROTON Merdeka Convoy with the theme of ‘1 Journey, 1 with Malaysia’,
whereby a convoy travelled in various Proton models to visit the four “Pintar” schools and six orphanages in
four states (Penang, Perak, Selangor and Kelantan.) During this journey, various activities were conducted
at the schools and orphanages, including essay-writing competitions, colouring competitions, gotong royong,
breaking of fast and tarawih prayers. The children were also presented with duit raya in time for the Aidil
Fitri celebration.
The year also saw PROTON finalising an Advanced Diploma program in Automotive Design and Manufacturing
Engineering with the Ministry of Higher Education. This is parallel to the Group’s bid to educate students
with ambitions of becoming automotive vehicle mechanics by providing deserving underprivileged candidates
with scholarships and work-based learning opportunities at PROTON Service Centres.
A new project that PROTON embarked on with other GLCs is the Program Sejahtera, an “Adopt a Community”
project at Kampung Teluk Melati in Maran, Pahang.
Operations Review
Program Sejahtera was launched by the Prime Minister, Y.A.B. Dato’ Sri Mohd Najib Tun Razak on the 4th of
September 2009, and is a nationwide CSR programme championed by Khazanah with the aim of eradicating
poverty in Malaysia. In this programme, PROTON has committed to contribute RM175,000 to help build
five units out of 50 houses needed for the rehabilitation program for the vulnerable members of the society
in Maran.
The Group has taken its own initiative to help the needy by introducing the Bridging Community Programme.
126 Under this programme, PROTON allocated a budget of RM30,000 to upgrade and provide basic facilities,
books, computers and tuition to the children at three adopted orphanages, namely, Pertubuhan Kebajikan
Anak Yatim & Miskin Darul Aitam Temoh in Perak, the Rumah Anak Yatim Siraman Kasih Rawang and
Rumah Anak Yatim Sekendi Sabak Bernam in Selangor.
25 STERLING YEARS
The year also saw PROTON carrying out various charity activities such as visits to old folks’ homes, orphanages
and shelter homes for the handicapped and needy families, as well as visits to children suffering from
terminal illnesses in local hospitals.
In addition to this, PROTON has continued to support various national bodies and organisations like MERCY
Malaysia, Yayasan Harapan Kanak-Kanak, Yayasan Orang Kurang Upaya Kelantan, the Paediatric Ward of
Hospital Tengku Ampuan Rahimah Klang, and PEMADAM with sponsorships in the form of cars.
PROTON has been the main sponsor for the Malaysian Skills Competition (the automobile sector) organised
by the Ministry of Works since 2003. The annual grant includes sending Malaysian representatives to the
ASEAN and World Competitions, with the objective of nurturing young local talents, below the age of 22, in
this sector and developing world-class human capital.
Additionally, the Group held an Invention and Innovation Competition for PROTON staff. The objective of
the competition was to encourage PROTON staff to contribute innovative and creative ideas on how future
generation Proton models should look and feel like. Each team, made up of eight members, were provided
with a scrap car, and their mission was to create a new concept car based on their creativity. The competition
attracted 20 groups in total.
Winner of the Malaysian

Skills Competition
(the autombile sector)
Operations Review

In sports, PROTON continued to support the local scene by helping to identify and build talent at the
grassroots level through development programmes, particularly in badminton and football.
The year 2010 marks PROTON’s 15 years of support towards the development of badminton in Malaysia, and
127
the Group continued its role as the major sponsor of badminton, through its partnership with the Badminton
Association of Malaysia (BAM). As the corporate custodian of badminton in the country, PROTON was
25 STERLING YEARS
the title sponsor for the PROTON Malaysia Super Series Badminton Tournament organised by BAM. On a
national level, PROTON was title sponsor for the Pahang Open 2009, Malaysia GP Gold 2009, Terengganu
Open 2009, Malaysia International Challenge Finals 2009 and PROTON GP Finals 2009. For the year under
review, PROTON allocated RM3.5 million (including promotional activities) for the sport.
As a result, the year saw Malaysian national players performing well in various international outings. Most
notably, world number one Datuk Lee Chong Wei won his very first coveted All-England title in March
2010.
For the 2009 Singapore Open Super Series, PROTON, together with BAM, organised a convoy to Johor in
conjunction with Malaysia’s participation, comprising of national players and coaches. Additionally, PROTON
became the official car sponsor to selected tournaments like the Malaysia Open Grand Prix Gold 2009 and
Super Series Masters Finals 2009.
Operations Review
128 PROTON FC emerged

as the Champion in the
Selangor Super League
25 STERLING YEARS
2010 after defeating

Permodalan Negeri
Selangor Bhd (PNSB).
In football, PROTON’s football team withdrew from the Liga Perdana to compete in the Selangor Super
League which they went on to win recently. PROTON FC’s Under-12 team is also currently competing in the
National Junior Community League.
The team had also taken the initiative to organise various invitational football tournaments like the 1PROTON
World Cup Fiesta, PROTON FC Football Community Challenge and the PROTON Soccer Cross-Straits
Invitation, as well as organising a Soccer Kids program for children of PROTON Group employees.
PROTON FC also participated in a list of other activities throughout the year, including the 1Malaysia
Football Tournament (U-15 team), Royal Selangor Club Football Tournament (U-8 team), and Arsenal Soccer
School Inter-continental Football Tournament (U-8, U-10 and U-15 teams).
Operations Review

129
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In the world of motorsports, the year under review saw the PROTON R3 Malaysia Rally Team making its
competition debut in the Intercontinental Rally Challenge (IRC) under the World Rally Super 2000 category
with the Satria Neo S2000. The team ended the season with commendable results, consistently finishing in
the top 10 positions in six rounds of the Championship, despite being in the company of more established
manufacturer teams. The PROTON R3 Malaysia Rally Team also participated in three rounds of the Asia
Pacific Rally Championship (APRC) in 2009. In Formula One, PROTON became an official partner of the
Lotus Racing team and provided marshal cars for the Malaysian F1 Grand Prix race held at the Sepang
International Circuit.
PROTON also continued in its support of the prestigious Le Tour de Langkawi international cycling event – an
event the Group has long been associated with. PROTON firmly believes that the event not only helped place
Malaysia on the world sporting map, but spurred the development of home-grown cycling talents to compete
at the international level. As the official car provider, PROTON supplied 150 cars of varying models for the
use of officials and the media.
A new addition to PROTON’s sporting line-up in the year under review was tennis, where PROTON became
title sponsor for the inaugural Malaysian Open, an ATP World Tour tournament. A budget of RM3,000,000
(inclusive of promotional activities) was spent for this event.
Operations Review
ENVIRONMENT,
HEALTH & SAFETY
130 THE PROTON GROUP IS THE BIGGEST AUTOMOTIVE MANUFACTURER
IN MALAYSIA COMPRISING SUBSIDIARIES THAT SPAN ACROSS A WIDE
INDUSTRIAL SPECTRUM – YET EVERY PROTON FACILITY IS UNITED IN OUR
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COMMITMENT TO RESPONSIBLE MANUFACTURING, AND IN ENSURING

THAT WORKING CONDITIONS ARE SAFE AND ENVIRONMENTALLY
RESPONSIBLE. OUR AFFIRMATION IN THIS AREA IS INGRAINED WITHIN
THE ENVIRONMENT, HEALTH AND SAFETY POLICY PLACED WITHIN
THE PROTON GROUP OF COMPANIES TO MANAGE THE ENVIRONMENT,
HEALTH AND SAFETY ASPECT OF OUR OPERATIONS.
ISO14001 Environmental Management System

PROTON has achieved international standards in environmental management in line with the
ISO14001 Environmental Management System. In August 2009, PROTON passed the ISO14001
Environmental Management System (ISO14001 EMS) assessment audit by the Vehicle Certification
Agency (VCA) – part of the requirements of both the UK Department for Transport and SIRIM Malaysia
and accredited by the United Kingdom Accreditation Service (UKAS).
Delivering
Beyond
Expections
A New
Dawn in
Environment,
Health &
Safety
Operations Review
This phase was successfully accomplished following an aggressive

pursuit to achieve these standards since the project was first
initiated in 2007. This international recognition is an assurance
that PROTON’s environmental management is systematic and
benchmarked against international standards. Our vendors,
132 suppliers and dealers are collectively encouraged to adopt the
same standards. The certification will especially make a favourable
impression on export markets such as the UK and Australia where
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environmental concerns are of paramount importance.

Operations Review

At the manufacturing site, environmentally-friendly equipment, machinery, robots and 133
automation systems have been installed. These facilities improve the efficiency level,
utilise less energy, and emit less wastes and toxic emissions into the atmosphere.
25 STERLING YEARS
In other areas like the Paint Shop, the manual spraying process has been completely
replaced with electrostatic type robots. An electrical charge is induced into the paint
mixture to polarise the molecules so that they are electro statically attracted to the car
body with the opposite charge. Paint and thinner consumption have been also reduced
by approximately 30 percent.
PROTON has also introduced technology which has reduced the usage of paper and ink
in our offices. The Group-wide practice of sound environmental management has aided
in reducing operational costs, while creating a harmonious and healthier environment
for all.
Toxic substance removal

In the last decade, there has been a growing global awareness of environmental issues
and an increased focus on sustainability. PROTON has since consciously implemented
relevant sustainable practices within our operations to ensure that resources are utilised
efficiently, while waste and pollution are correspondingly reduced.
As the leading automotive manufacturer in this region, PROTON stands steadfast in

our commitment to design green products, to the best of our ability. This includes
considering the environmental impact of the materials used. From the metal, plastic,
and glass in our products to the paper and ink in our offices, our goal is to continue
leading the industry in reducing or eliminating environmentally harmful substances.
One of our core focus in this area is the phasing out of ozone depleting substances within
our Manufacturing process. Through the years we have consistently and systematically
phased out the usage of ozone depleting substances, such as Chlorofluorocarbons
(CFC). Alternative ozone friendly substances and technologies have been adopted at
PROTON’s production operations.
Operations Review
Health and Safety

Management Commitment
PROTON’s commitment to ensuring a safe, healthy and conducive working environment is formalised within
the Group’s Environment, Health and Safety (EHS) policy. This policy guides the EHS management of
every subsidiary. The management has been entrusted to provide adequate manpower, budgets and conduct
134 regular meetings to ensure that the policy and plan are seriously implemented. PROTON actively encourages
subsidiary companies to provide strong management commitment to sustain the interest of all employees
with regards to Environment, Health and Safety programs, in order to reduce and eliminate occupational
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injuries and illnesses.
Supplementing the EHS policy, Occupational Safety and Health (OSH) programme and activities were
developed throughout the course of the year. These are driven by a legal requirement under the OSH Act
1994 & Factories and Machinery Act 1967. The objective of the programme is to secure the safety, health and
welfare of persons at work and to protect all visitors and employees at the workplace from safety hazards.
To this end, relevant meetings and activities have been structured into the work schedule and are rigorously
carried out within the PROTON Group.
These include:
1. Quarterly OSH committee 5. OSH and Road Safety campaigns

management meetings
6. Fire safety evacuations
2. Monthly Safety and Health audits in plants
7. Contractor safety and monitoring surveys
3. Health risk assessments and analysis
8. Cross safety audits among the subsidiaries
4. Safety training
People-friendly working conditions

Another important item on the agenda is the ergonomic improvement programme aimed at emerging people-
friendly working conditions and reducing workload at the assembly line. Ergonomics covers all aspects
of the job from the physical stresses it places on joints, muscles, nerves, tendons, bones and the like, to
environmental factors which can affect hearing, vision, and general comfort and health. Physical stress
may arise when workstations, equipment, or tools do not fit the worker well. These stress factors can cause
long-term damage to muscles, nerves, and joints. Most illnesses due to ergonomic causes occur because
of forceful or repetitive work activities, mechanical stress, temperature, lighting, or because workers are
required to assume awkward postures over a period of time.
Operations Review

135
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PROTON’s Emergency Centre located at the PROTON Centre of Excellence.
The following are initiatives that have been successfully implemented:
1. Elimination of heavy lifting at assembly line to reduce backaches problem and practice
rotation system.
2. Abolition of carrying heavy items that are more than 10kg in weight such as the carrying of
window glass, seat, instrument panel, exhaust pipe and tire.
3. Abolition of heavy physical work such as high torque wrench corresponding more than 10kg-m
for the tightening of suspension, tire bolts and drive shafts.
4. Abolition of untidy work and other operating dislikes such as urethane application and fluid
charging.
Small improvements in work infrastructure can also make a big difference in creating a more conducive work
environment. To eliminate any unnecessary stress on our operators’ spines due to work posture, we have
implemented a door-less car for easier access, and improved working height levels to reduce bending.
PROTON also seeks to make the workplace a vibrant and stimulating environment for our workers by ensuring
good lighting and ventilation, implementing friendly work ethics and ensuring adequate people-friendly
features such as water coolers and pantries where possible.
Operations Review
Commuting safety
Commuting safety, including car driving and motorcycle riding are among PROTON’s top priorities. PROTON’s
management has implemented several major programs and campaigns to instill sound commuting practices.
Among these were:
1. An annual road safety and industrial safety campaign in collaboration with Department of
136 Occupational Safety and Health (DOSH), Jabatan Keselamatan Jalan Raya (JKJR), Police, National
Institute of Occupational Safety & Health (NIOSH) and other agencies. This programme was
successfully launched by Y.Bhg Dato’ Hj Syed Zainal Abidin B Syed Mohamed Tahir, the Managing
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Director on 11 September 2009.
2. Monthly MDRT (motorcycle defensive riding) courses targetting high risk riders and youngsters’,
are carried out by our internal trainers.
3. Regular motorcycle convoys among riders to foster correct techniques of motorcycle riding.
Such convoys usually travel interstate between 150km to 250km and includes motivational
programmes.
4. Organising safety and defensive driving programmes for employees and selected customers to
teach safe and defensive driving techniques. This is in response to the Government’s call to make
the roads safer and to bring down the alarming number of road accidents and fatalities.
With stringent safety practices in place, industrial accidents recorded in 2007, 2008 and 2009 were 18,
11 and 14 respectively. PROTON is on a continuous quest to reduce these numbers.
Operations Review

Environment, Health and Safety Audit 137
There is a need for a check and balance system to ensure that our EHS vision becomes a reality. To ensure
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that management and employees are committed to creating safe and healthy working conditions and to
protecting the quality of the environment around them, regular EHS audits are held throughout the Group.
Audit activities in the last fiscal year revealed that most of our working places were in compliance with a
majority of the standards and regulations that PROTON constantly endeavours to adhere to.
Fire evacuation and emergency drill

Fire evacuation procedures and emergency drills are conducted on a regular basis. As a follow-up, all noted
deficiencies have been addressed through the post-audit corrective action together with the local authority
fire department.
NIOSH and PROTON collaboration to safety induction

The National Institute of Occupational Safety Health Malaysia (NIOSH), a unit under the Ministry of Human
Resource, and PROTON HOLDINGS BERHAD have organised a framework of Safety and Health Induction to
promote the safety and health culture among contractors together with workers.
Together, NIOSH and PROTON are working to establish an Occupational Safety and Health – NIOSH Safety
Passport for PROTON (OSH – NSPP). This joint arrangement will include training and assessment activities
which will lead to PROTON Contractor’s Workers (PCW) being awarded the NIOSH Safety Passport for
PROTON (NSPP).
PROTON’s focus on constantly enhancing the design and features
of our car models is replicated in the way we conduct our corporate
affairs. PROTON has laid a foundation of integrity, transparency
and responsibility to ensure good corporate governance is
practiced throughout the Group.
We mantain a commitment to good

governance ... in all we do.
A New Dawn In Responsibility

Statement on Corporate Governance
THE BOARD OF PROTON IS COMMITTED TO APPLYING THE

RECOMMENDATIONS OF THE MALAYSIAN CODE ON CORPORATE
GOVERNANCE (REVISED 2007) (“THE CODE”) AND THE PRINCIPLES OF
BEST PRACTICES RECOMMENDED IN THE CODE TO ENSURE THAT GOOD
CORPORATE GOVERNANCE IS PRACTICED THROUGHOUT THE GROUP
140 TO EFFECTIVELY DISCHARGE ITS RESPONSIBILITIES TO PROTECT AND
ENHANCE SHAREHOLDER VALUE.
25 STERLING YEARS
The Board is also committed to abiding by the Guidelines to Enhance

Board Effectiveness as set by the Putrajaya Committee on GLC High
Performance (PCG), and at the same time, striving to maintain a high
level of corporate governance within the PROTON Group by ensuring
that the highest standards of corporate culture are practiced throughout.
Good corporate governance is the foundation of the culture and business
practices of the PROTON Group.
Set out below is a statement on how the Group has applied the principles
and adopted the best practices as laid down in the Code. This statement
describes how the Principles of Good Governance and provisions of the
Code, are applied by the Group.
BOARD OF DIRECTORS
The Board is committed to establishing and enhancing shareholder
value in the long-term and is pleased to report that the Group has to
its best efforts and knowledge complied with the Principles and Best
Practises of the Code throughout the financial year under review. The
Board continues to enhance its role in improving governance practices
effectively to safeguard the interests of the shareholders as well as
stakeholders. To this end, the Board has full control of and is responsible
for, the Group’s overall strategy, acquisition and divestment policies,
capital expenditure, annual budget, review of financial and operational
performance, and internal controls and risk management processes. The
Group’s overall strategic direction, development, implementation and
control remain of primary importance to the Board.
141
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Dato Sri’ Mohd Nadzmi Bin Mohd Salleh who was
previously the Managing Director of Perusahaan
Otomobil Nasional Berhad (the then listed entity on the
Kuala Lumpur Stock Exchange) from 29 June 1993
until 1 April 1996, made a return to PROTON when he
was appointed as Non-Executive Chairman of PROTON
on 1 January 2009.
The roles and responsibilities of the Non-Executive

Chairman and the Managing Director are clearly defined.
The Chairman ensures the integrity and effectiveness of
the Board as a whole. He conducts Board meetings and
ensures that meetings proceed in an orderly manner.
The Managing Director (“MD”) on the other hand is

responsible for making and ensuring the implementation
of broad policies as approved by the Board and reports
to and discusses material matters including regulatory
developments and strategic projects with the Board.
There is therefore a natural separation of management
and governance leading to a balance of responsibility
and authority.
The Non-Executive Directors are independent of

management and are free from any business relationship
which could materially interfere with the exercise of
their independent judgment.
The Board has delegated matters pertaining to the day to

day management, operations and strategic development
of the Group, subject to the Limits of Authority and
Group Policy and Procedures, to the Managing Director
who is supported by a competent Management Team.
In the financial year ended 31 March 2010, the Board of PROTON Holdings Berhad (PHB) met ten (10)
times details of which are as shown below:
Date of Date of Meeting

Name of Director Designation Percentage
Appointment Resignation Attendance
Dato’ Sri Mohd Nadzmi Non-Independent 1 January 2009 N/A 10/10 100%
142 Bin Mohd Salleh Non-Executive
Chairman
Dato’ Haji Syed Managing Director 1 January 2006 N/A 10/10 100%
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Zainal Abidin B Syed

Mohamed Tahir
Dato’ Michael Independent 15 September 2006 N/A 10/10 100%
Lim Heen Peok Non-Executive Director
Dato’ Zalekha Non-Independent 11 February 2008 N/A 10/10 100%
Binti Hassan Non-Executive Director
Mr. Behara Venkata Independent 1 March 2010 N/A N/A N/A
Rama Subbu Non-Executive Director
Tan Sri Rainer Althoff Independent 22 June 2010 N/A N/A N/A
Encik Abdul Rahim Independent 20 July 2010 N/A N/A N/A
Bin Abdul Hamid Non-Executive Director
Tuan Haji Abdul Jabbar Independent 12 April 2004 21 August 2009 5/5 100%
Bin Abdul Majid Non-Executive Director
Tuan Haji Abdul Kadir Independent 10 March 2005 27 May 2010 9/10 90%
Bin Md Kassim Non-Executive Director
Mr. Oh Kim Sun Independent 13 May 2009 27 May 2010 9/10 90%
The profiles of the directors are set out on pages 26 to 33 of the Annual Report.
Board meetings for the Company and its subsidiaries are scheduled in advance before the start of each
calendar year and the meetings calendar is circulated to all Board Members at the beginning of each
year. This would enable the Directors to plan ahead and ensure attendance at Board Meetings. Additional
meetings or Special Board meetings are convened whenever necessary when there are urgent and important
decisions to be made.

BOARD COMPOSITION AND BALANCE
The Board currently consists of seven (7) members with the Chairman being a Non-Independent Non-
Executive Director, one (1) Non-Independent Non-Executive Director, four (4) Independent Non-Executive
Directors and one (1) Executive Director (who is the Managing Director).
Apart from the Managing Director, all the Non-Executive Directors are independent of management and free
from any business or other relationships, which could materially interfere with the exercise of independent
judgment. 143
INDEPENDENCE AND CONFLICT OF INTEREST
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The Directors are required to make written declarations and it is their responsibility to declare whether they
have a potential or actual conflict of interest in any transaction. Where issues involve conflict of interest, the
interested Directors shall abstain from discussing or voting on the matter.
SUPPLY OF INFORMATION
The Board has full access to the Company Secretary who is available to provide the Directors with the
appropriate advice and services and also to ensure that the relevant procedures are followed and rules and
regulations are complied with. The Board is, from time to time, updated on changes in the law, governance
and other regulatory requirements.
At the same time, the Board may from time to time request for information pertaining to the Group’s business
affairs to enable the Board to discharge its responsibilities effectively.
Senior Management as well as professional and external advisors are from time to time invited to attend
Board meetings to deliberate and clarify issues on the subject matter concerned.
In general, the agenda, board papers and minutes of previous meetings of the Board and Board Committees
including minutes of board meetings of subsidiary companies are circulated in advance to the Board, before
meetings. The agenda for every meeting permits the Board members to review the contents of meetings and
enable the Chairman to better and more efficiently conduct the proceedings at Board meetings.
The Company has drawn up a list of transactions that would require the prior approval of the Board. The
same is reflected in PROTON’s Group Policy and Procedures and Limits of Authority.
POLICY ON APPOINTMENT OF DIRECTORS

The Board Nomination & Remuneration Committee reviews all new appointments by taking into consideration
the skill sets required by the Company and the Group. Board Members are appointed through a formal and
transparent selection process that is consistent with the Articles of Association of the Company and the
Company’s Selection Policy for Directors.
New Directors are required to undergo familiarisation programmes, plant visits and briefings to get a better
understanding of the PROTON Group, its operations and the automotive industry.
Apart from carrying out annual reviews on the mix of skills and experience of the Directors, the Board
Nomination & Remuneration Committee also identifies, assesses and recommends all key positions within
the PROTON Group including that of all members of the senior management committee, direct reports to
the Managing Director, positions having significant impact to PROTON as well as Managing Directors of
subsidiary companies.
RE-ELECTION OF DIRECTORS
144 All Directors including the Executive Director are subject to retirement by rotation at least once in every three
years and are eligible for re-election. In accordance with Article 104 of the Articles of Association of the
Company and the Main Market Listing Requirements of Bursa Malaysia Securities Berhad, at least 1/3 of the
25 STERLING YEARS
Directors shall retire from office at each Annual General Meeting, PROVIDED ALWAYS that all Directors shall
retire from office once at least in each three (3) years but shall be eligible for re-election.
Further, any new Director appointed to fill a casual vacancy or as an addition to the existing Directors
shall only hold office until the next Annual General Meeting of the Company and shall then be eligible for
re-election as stipulated under Article 111.
Directors who are over seventy (70) years of age are required to submit themselves for retirement annually at
the Annual General Meeting, unless the Director is re-appointed by way of special resolution in accordance
with Section 129 (6) of the Companies Act, 1965. None of the Directors of the Company are subject
to retirement pursuant to Section 129 of the Companies Act, 1965 at the forthcoming Annual General
Meeting.
At the forthcoming Annual General Meeting of the Company, the following Directors will retire and are
eligible for re-election:
(i) Pursuant to Article 104

• Dato’ Zalekha Binti Hassan
(ii) Pursuant to Article 111

• Mr. Behara Venkata Rama Subbu
• Tan Sri Rainer Althoff
• Encik Abdul Rahim Bin Abdul Hamid
BOARD COMMITTEES
The Board had established five Board Committees, namely the Board Audit Committee, Board Nomination
& Remuneration Committee, Board Risk Management Committee, Board Disciplinary Committee and Board
Executive Committee, the primary functions of which were to assist the Board in overseeing the affairs of the
Group and these Committees had been entrusted with specific responsibilities and authority.
The abovementioned Board Committees were authorised to examine specific issues and report to the Board
with their recommendations. The responsibility of decisions on all matters ultimately lies with the Board as
a whole.

However, following review of functions and for better efficiency, clarity, transparency and coordination, the
Board of PROTON has, on 27 July 2010, resolved the rationalisation of these Board Committees and with
effect from 1 August 2010, PROTON has the following Board Committees:
(i) Board Audit Committee (which apart from the functions stated herein, shall also assume the role of
overseeing the overall management of all risks of the Group’s businesses); and
(ii) Board Nomination and Remuneration Committee (which apart from the functions stated herein, shall
also oversee the disciplinary matters affecting senior officers of the Group, complaints lodged through 145
the Whistle Blower Policy and all matters relating to the Code of Conduct and Ethics).
25 STERLING YEARS
(A) BOARD AUDIT COMMITTEE
The Board Audit Committee (“BAC”) met eight (8) times during the course of the financial year. The
composition of the BAC and their respective attendance record at meetings for the financial year ended 31
March 2010 are as follows:

No Name Of Director Designation
1 Dato’ Michael Lim Member Independent 29 November 2006 N/A 8/8

Heen Peok Non-Executive Director
2 Dato’ Zalekha Binti Member Non-Independent 27 May 2010 N/A N/A
Hassan Non-Executive Director
3 Tan Sri Rainer Athoff Member Independent 20 July 2010 N/A N/A
4 Encik Abdul Rahim Member Independent 20 July 2010 N/A N/A
Bin Abdul Hamid Non-Executive Director
5 Tuan Haji Abdul Jabbar Member Independent 10 March 2005 21 August 2009 2/2
Bin Abdul Majid* Non-Executive Director
6 Tuan Haji Abdul Kadir Member Independent 10 March 2005 27 May 2010 7/8
7 Mr. Oh Kim Sun* Chairman Independent 13 May 2009 27 May 2010 6/6
8 Mr. Behara Venkata Member Independent 27 May 2010 20 July 2010 N/A
Rama Subbu Non-Executive Director
Note (*): Tuan Haji Abdul Jabbar was the Chairman of the Board Audit Committee up to 13 May 2009, wherein Mr. Oh Kim Sun took
over the Chairmanship till 27 May 2010. Tuan Haji Abdul Jabbar continued as a Member of the Board Audit Committee until
his resignation as Director and Member of the Board Audit Committee of PROTON on 21 August 2009.
During the financial year, the BAC of PROTON Holdings Berhad undertook the following activities:
(a) Assisted the Board in discharging its statutory duties and responsibilities relating to accounting and
reporting practices of the Company and the Group in accordance with Generally Accepted Accounting
Practices.
(b) Reviewed the external audit terms of engagement, the audit strategy, the proposed audit fee and the
achievement of the agreed upon reporting timeframes for the audit of the financial statements.
146
(c) Reviewed the external audit reports and discussed any problems and reservations arising thereon.
(d) Reviewed the internal audit plan, methodology, functions and resources.
25 STERLING YEARS
(e) Reviewed major findings on internal audit reports and management response.
The Salient Terms of Reference of the Board Audit Committee is set out below.
Compositions
The Committee shall be appointed from amongst the Board and shall:-
(i) comprise of no fewer than three members;
(ii) all the members must be non-executive directors; and
(iii at least one member must be a member of the Malaysian Institute of Accountants or if he is not, then
he must be a person who complies with Para. 15.09 (1) of Bursa Malaysia Securities Berhad’s Main
Market Listing Requirements.
No alternate director may be appointed as a member of the Board Audit Committee.
The Board will review the terms of office and the performance of the Board Audit Committee and its members
at least once every three years.

Functions And Duties
The functions and duties of the Board Audit Committee shall be to:-
(a) Review and report to the Board of Directors on the following:-
• with the External Auditors, the audit plan;
• with the External Auditors, the External Auditor’s evaluation of the system of internal controls;
147
• with the External Auditors, the External Auditor’s audit report;
25 STERLING YEARS
• the assistance given by the Company’s employees to the External Auditors;
• the adequacy of the scope, functions and resources of the internal audit functions and that it has
the necessary authority to carry out its work, and the performance of the members of the internal
audit function;
• the internal audit programme, processes, the results of the internal audit programme, or
investigation undertaken and whether or not appropriate action is taken by the management on the
recommendations of the internal audit function;
• the quarterly results and year-end financial statements, prior to the approval by the Board of
Directors, focusing particularly on:-
(i) changes in or implementation of major accounting policy;
(ii) significant and unusual events;
(iii) compliance with accounting standards and other legal requirements; and
(iv) accuracy and adequacy of the disclosure of information essential to a fair and full presentation
of the financial affairs of the Group;
• any related party and conflict of interest situation that may arise within the listed issuer or group
including any transaction, procedure or course of conduct that raises questions of management
integrity;
• promptly report to Bursa Malaysia Securities Berhad on any matter reported by it to the Board of
the Company which has not been satisfactorily resolved resulting in a breach of the Main Market
Listing Requirements of Bursa Malaysia Securities Berhad;
• submit to the Board a Report on the summary of activities of the Board Audit Committee in the
discharge of its functions and responsibilities in respect of each financial year.
(b) Consider the appointment of the external auditor, the audit fee and any questions of resignation and
dismissal.
Meetings
The Committee shall hold meetings on at least four occasions each year although additional meetings may
be called as and when necessary, by the Chairman of the Committee. These meetings will usually be:-
• prior to the current year’s audit;
• upon completion of the External Auditor’s interim examination;

148 • prior to the meeting of the full board to approve the financial statements;
• prior to the announcement of the quarterly results;

25 STERLING YEARS
• upon the request of any member of the Committee or the External Auditors, the Chairman of the Committee
shall convene a meeting of the Committee to consider the matters brought to its attention;
• at least once a year, the Committee shall meet with the External Auditors without any Executive Directors
present.
Attendance
In order to form a quorum in respect of a meeting of the Audit Committee, the majority of members must be
present throughout the meeting. The Chairman may request that any Board members, and members of the
management, the Internal Auditors and / or representatives of the External Auditors be present at meetings
of the Committee.
Secretary & Records
The Company Secretary shall be the Secretary to the Committee and shall be present at all meetings to
record minutes.
Minutes of each meeting shall be prepared and entered into the books provided for the purpose and sent to
the Committee members and will be made available to all Board members. The Minutes shall be signed by
the Chairman of the Committee.
Internal Audit
The Group uses the services of the Group Internal Audit Division to accomplish its internal audit requirements.
The Group Internal Audit Division reports to the Board Audit Committee on matters concerning internal audit
and assists the Board of Directors in monitoring and managing risks and internal controls.
The Group Internal Audit Division reviews internal controls related to all key activities of the Group and
recommends improvements in controls and procedures. The Group Internal Audit Division is independent of
the activities it audits and performs with impartiality and due professional care. The findings of the Group
Internal Audit Division are reported to the Board Audit Committee.
The Board Audit Committee approves the internal audit plan of the Group Internal Audit Division each year.
The scope of the internal audit covers the audits of all units and operations, including subsidiaries.

During the year, the Group Internal Audit Division serves to ensure internal control measures are adequate
and effective in mitigating key risks and that they are monitored. The monitoring process will form the basis
for continually improving the risk management process in the context of the Group’s overall goals.
(B) BOARD NOMINATION & REMUNERATION COMMITTEE

The objectives of the Board Nomination & Remuneration Committee (“NRC”) are in accordance with the
Terms of Reference as approved by the Board of Directors of PROTON on 26 July 2006.
149
The NRC reviews appointments of new directors of the Group and the balance and effectiveness of the boards
of directors, taking into account the required mix of skills and experience and other qualities, before making
25 STERLING YEARS
recommendations to the Board. The Committee is empowered to conduct periodic reviews on the overall
remuneration policy and package of the Executive and Non-Executive Directors and Senior Level Mission
Critical Positions of the Group, for recommendation to the Board. The authority and scope of coverage of
the NRC is over the PROTON Group, which includes subsidiaries and relevant associates and other investee
companies.
The NRC is made up entirely of Non-Executive Directors, with the majority consisting of Independent Non-
Executive Directors.
Appointments to the Committee shall be for a period of three (3) years, which may be extended provided that
the majority of the Committee members remain independent.
The NRC met 4 times during the financial year.
The Composition of the NRC is as follows:

Name of Director Designation
Dato’ Sri Mohd Nadzmi Chairman 1 January 2009 N/A 4/4

Bin Mohd Salleh
Encik Ahmad Tajuddin Member 29 August 2005 N/A 4/4
Bin Abdul Carrim Independent
Dato’ Michael Lim Heen Peok Member 13 November 2006 N/A 4/4
Independent
Dato’ Zalekha Binti Hassan Member 1 August 2010 N/A N/A
Non-Independent
Non-Executive director
Encik Md Ali Bin Md Dewal Member Independent 29 August 2005 27 May 2010 4/4
(C) BOARD RISK MANAGEMENT COMMITTEE

(With effect from 1 August 2010, the Board Risk Management Committee was disbanded and the functions
were assumed by the Board Audit Committee)
The Board Risk Management Committee (“BRMC”) assisted the Board to oversee the overall management
of all risks faced by the Group’s business. Further details of the activities of the Board Risk Management
Committee are spelt out in the Statement of Internal Control.
150
The BRMC was made up entirely of Non-Executive Directors and third party members (not being directors of
the Company) who were appointed by the Board from time to time as follows:
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Name Designation
Datuk Tan Kim Leong Member Independent 29 August 2005 N/A 3/4
Dato’ Zainuddin Bin Che Din Member Independent 1 October 2008 N/A 4/4
Tuan Haji Abdul Kadir Chairman Independent 29 September 2005 27 May 2010 4/4
The composition of the BRMC was reviewed annually by the Board of Directors based on the recommendation
of the NRC.
The Group Risk Management Committee (“GRMC”) is entrusted with the responsibility for ensuring that an
appropriate risk management framework exists within the Group and effectively implemented to manage the
key risks of the organisation on an on-going basis.
The GRMC, which comprises of Senior Management, is responsible for overseeing risk management
implementation, regular updating of the Group’s risk profiles and improving the implementation of methodology
for risk management. The GRMC deliberates and determines the Group’s major risks to be escalated now to
the attention of the BAC.

(D) BOARD DISCIPLINARY COMMITTEE (“BDC”)
(With effect from 1 August 2010, the Board Disciplinary Committee was disbanded and the roles and
functions were assumed by the Board Nomination & Remuneration Committee).
The BDC was a platform for the PROTON Group that primarily dealt with disciplinary issues. The BDC was part
of the structural mechanism for the handling of cases that arose from the introduction of the Whistleblower
Policy and Asset Declaration Policy. The BDC had the power to initiate investigations, consider and take
appropriate action on any case referred to it by any party either received orally or in writing. 151
The BDC comprised members all of whom are Non-Executive Directors as follows:
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Name Designation
Dato’ Sri Mohd Nadzmi Chairman/ 1 January 2009 N/A N/A

Bin Mohd Salleh Non-Independent
Tuan Haji Yusof Bin Ahmad Member Independent 21 February 2008 N/A 2/2
Encik Ahmad Tajuddin Member Independent 1 March 2010 N/A N/A
Bin Abdul Carrim Non-Executive Director
Tuan Haji Abdul Jabbar Member Independent 7 May 2006 21 August 2009 2/2
Bin Abdul Majid Non-Executive Director
Tuan Haji Abdul Kadir Member Independent 7 May 2006 27 May 2010 2/2
(E) PROTON BOARD EXECUTIVE COMMITTEE

(With effect from 1 August 2010, the PROTON Board Executive Committee was disbanded)
The objective of the Board Executive Committee (“Board EXCO”) was to assist Management in addressing
issues relating to implementation and monitoring of several key projects, including but not limited to PROTON
Strategic Business Plan, Annual Management Plan, PROTON Business Turnaround Plan and also to address
issues relating to identifying suitable candidates to fill in several key positions for PROTON. It is to be noted
that the functions of the Board EXCO did not at any time overlap that of other Board Committees, such as
the Board Nomination & Remuneration Committee.
Subject to the resolutions of the Board of Directors of PROTON that was passed from time to time, the
provisions contained in the Terms Of Reference and the Memorandum and Articles of Association of the
Company, the Board EXCO exercised powers, authorities and discretions vested in the Board of Directors with
regard to the affairs and business of the Company.
PROTON’s Board EXCO comprised two (2) representatives from amongst the PHB Board Members and two
(2) Senior Management representatives as follows:

Name of Director Designation Appointment Resignation Attendance
Dato’ Sri Mohd Nadzmi Chairman/ 1 January 2009 N/A 1/1
152 Bin Mohd Salleh Non-Independent
Dato’ Haji Syed Zainal Abidin Managing Director 17 April 2007 N/A 1/1
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B Syed Mohamed Tahir

Dato’ Michael Lim Heen Peok Independent 17 April 2007 N/A 1/1
Encik Azhar Bin Othman Chief Financial Officer 22 July 2009 N/A 0/0
Ms. Vimala Menon Director - Finance and 16 June 2008 31 August 2009 1/1
Corporate Affairs
DIRECTORS’ TRAINING
All Directors have successfully completed the Mandatory Accreditation Programme (“MAP”) conducted by
Bursatra Sdn. Bhd. and as imposed by Bursa Malaysia Securities Berhad.
Notwithstanding that Bursa Malaysia Securities Berhad’s Continuing Education Programme was repealed
with effect from 1 January 2005, the Company, generally, and the Directors specifically continue to identify
and attend appropriate seminars and courses to keep abreast of changes in legislation and regulations
affecting the Group.
The Company has arranged various in house training programmes and luncheon talks on topics relevant
to the Group, which were attended by both the members of the Board and Senior Management, including
briefings on new international financial reporting standards, in particular, FRS 139 (Financial Instruments:
Recognition and Measurement), regional and global markets updates (and its impact to PROTON).
Full day knowledge sharing workshops and half day sessions on the global automotive outlook for 2009 and
2010 were also conducted in the course of the year.
PROTON has engaged the services of a global growth consulting company to share global and regional
automotive knowledge with the Board Members and Management through various types of workshops. The
goal of this engagement is to deliver continuous learning to PROTON through interactive sessions supported
by market analysis, technology trends, best practices, economic and policy impact analysis from across the
region. The automotive consultant has during the course of the year conducted workshops and luncheon
training programmes for both the Directors and Management of PROTON Group.

DIRECTORS’ REMUNERATION
The NRC is responsible for reviewing the performance of the Executive Directors and recommending to the
Board the remuneration package and reward structure. The Board as a whole determines the remuneration
of the Non-Executive Directors, Executive Directors as well as for Senior Management. Directors do not
participate in any discussions or decisions concerning each individual’s remuneration.
In the case of the Executive Director, the remuneration is structured to link rewards to corporate and individual
performance through key performance indicators comprising fixed and performance-based rewards. 153
The level of remuneration of the Non-Executive Directors reflects the experience and level of responsibilities
25 STERLING YEARS
undertaken by the Director concerned. The Non-Executive Directors are paid annual fees and attendance
allowances (in accordance with the number of meetings attended). In addition, the Non-Executive Directors
are also provided with Benefits-In-Kind, including provision of a fully maintained company car, petrol card
and full coverage under the Directors and Officers Insurance Scheme.
Non–Executive Directors fees are paid upon shareholders approval at each Annual General Meeting.
The NRC carries out reviews when appropriate and refers to remuneration surveys and consultants to assist
in determining the appropriate level of reward, which is competitive and consistent with the corporate
objectives. This is necessary in order to attract and retain professionals with the qualities needed to manage
the Group successfully.
Details of the total remuneration of the Directors of PROTON Holdings Berhad for the financial year ended
31 March 2010 are as follows:
Basic Salaries/Bonus and

Director Others Employee Benefits Fees and Benefits Total (RM)
(RM) Allowances (RM) in Kind (RM)
Executive Directors 1,631,844 - 127,607 1,759,451
Non-Executive Directors - 1,389,423 109,064 1,498,487
TOTAL 1,631,844 1,389,423 236,671 3,257,938
Number of Directors
Range of Total Remuneration Total
Executive Non-Executive
RM1,001 – RM50,000 - 1 1
RM50,001 – RM100,000 - 3 3
RM200,001 – RM250,000 - 1 1
RM500,001 – RM550,000 - 1 1
RM550,001 – RM600,000 - 1 1
RM1,750,001 – RM1,800,000 1 - 1
TOTAL 1 7 8
FINANCIAL REPORTING
The Board is committed to providing a balanced, clear and meaningful assessment of the financial
performance and prospects of the Group to shareholders, the investor community and the regulatory
authorities. Shareholders and other stakeholders are kept abreast of the Group’s performance through the
timely announcement of the quarterly financial results and accompanying press releases.
The Board Audit Committee assists the Board to oversee the financial reporting processes and the quality
154 of its financial reporting. Quarterly financial results and annual financial statements are reviewed by the
Board Audit Committee to ensure adequacy and completeness of information prior to the Board’s approval.
To enhance quality of the Group’s financial reporting, the external auditors conduct quarterly reviews of the
25 STERLING YEARS
Group’s quarterly results in addition to the year-end audit
DIRECTORS RESPONSIBILITY STATEMENT

The Board is required by the Companies Act, 1965, to ensure that financial statements prepared for each
financial year have been made out in accordance with the applicable approved accounting standards and
give a true and fair view of the state of affairs of the Company and the Group at the end of the financial year
and of the results and cash flow of the Company and the Group for the financial year.
The Board is responsible for ensuring that the Company and the Group keeps accounting records which
disclose with reasonable accuracy, the financial position of the Company and the Group and that the financial
statements comply with the Companies Act, 1965.
In preparing the financial statements the Board has:-
• selected suitable accounting policies and applied them consistently;
• made judgments and estimates that are reasonable and prudent;
• ensured that all applicable accounting standards have been followed; and
• prepared financial statements on the going concern basis as the Directors have a reasonable expectation,
having made enquiries that the Group has adequate resources to continue in operations for the foreseeable
future.

Internal Controls
The Board acknowledges its overall responsibility for maintaining a system of internal controls that provides
assurance of effective and efficient operations and compliance with laws and regulations and also its internal
procedures and guidelines. The size and complexity of the operations may give rise to risks of unanticipated
or unavoidable losses.
The system of internal controls is designed to provide reasonable but not absolute assurance against the
risk of material errors, frauds or losses occurring. The Board Audit Committee reviews the effectiveness of 155
the system of internal controls, which covers financial, operational and compliance controls, and also risk
management.
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Relationship with Auditors
The Board Audit Committee maintains an appropriate transparent relationship with both the Group external
auditors and internal auditors. The external auditors are invited to attend Board Audit Committee meetings
and present their audit findings when the Company’s quarter and annual financial results are considered.
The Board Audit Committee meets with the external auditors at least once a year without the presence of the
Executive Director and Management.
Dialogue Between The Company And Shareholders / Investors
The Board recognises the importance of transparency and accountability to its shareholders and investors.
Different channels of communication are optimised to provide shareholders and investors with a balanced
and complete view of the Group’s performance and the issues faced by its businesses in the competitive
environment amidst a changing landscape.
The issue of the Annual Report is an important medium of information for the shareholders and investors
whereas the Annual General Meeting of the Company is the main forum for communication and dialogue
with the shareholders. Shareholders are encouraged to actively participate and interact with the Board and
members of the senior management pertaining to the items on the agenda, during the general meeting.
Shareholders are also given the opportunity and time to raise questions on the future growth prospects and
strategies of the PROTON Group.
In addition, the Chairman briefs the shareholders on the Group’s operations for the financial year. Senior
management and the external auditors are always present to respond to questions and queries to ensure a
high level of accountability and transparency of the business goals, strategy and operations.
The Board strives to maintain open and effective dialogue with shareholders and regular meetings are held
with institutional shareholders throughout the year to discuss the progress of the group, future growth
prospects and strategy. In the course of the year the Board and Management have engaged in dialogue
sessions with the Major Shareholders of PROTON and the representatives from the Malaysian Institute of
Corporate Governance and Minority Shareholder Watchdog Group. Other channels of communication include
company presentations, seminars, press releases and interim and annual reports.
156 Besides the Annual Report, the Board ensures timely announcements are made to Bursa Malaysia Securities
Berhad and disseminates clear, accurate, and sufficient information to enable the shareholders and investors
to make informed decisions. The Investor Relations Unit also proactively disseminates appropriate and
relevant information to the investor community and attends to whatever queries they may have.
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There is a company website www.proton.com which provides information on the Company for all shareholders
and the general public.
CODE OF CONDUCT AND DISCIPLINE

The PROTON Group has put in place the Code of Conduct and Discipline, which every employee is required
to adhere to. Such code may be modified, added to, substituted for or otherwise amended from time to time
as the Board deems fit. An employee is also required to comply with the penal code of the country.
Code of Ethics
The PROTON Group has established specific rules and regulations to govern the conduct of its employees.
The Directors and employees of PROTON Group are expected to obey all laws in conducting business and to
always act with honesty, integrity, loyalty, trustworthiness, fairness and responsibility.
It is PROTON’s policy and Management’s responsibility to apply these rules fairly and equitably to all
employees.
Infringement of these rules may lead to disciplinary action such as verbal or written warnings, suspension
without pay and separation from the Company / Group.

Purpose of Policy
This purpose of this policy is to provide a framework for the proper conduct of directors and employees while
on the job. The policy gives directors and employees guidance in identifying business situations which have
the potential to create legal and ethical problems and to provide directions in handling those potential and
actual situations.
The respective codes are made available to the Directors and employees.
157
Whistleblower Policy
PROTON had on 27 July 2006 implemented a Whistleblower Policy. The objective of the policy is to provide
25 STERLING YEARS
a mechanism for preventive and corrective action within the Group without the negative effects that come
with public disclosure, such as loss of Company image or reputation, financial distress and loss of investor
confidence.
The policy encourages employees or representatives of PROTON to disclose genuine concerns about illegal,
unethical or improper business conduct within the Group. In this manner, the employees can help the
PROTON Group to monitor and keep track of such illegal, unethical or improper business conduct within,
which otherwise, may not be easily detected through normal process or transaction.
BUSINESS CONDUCT
The Group is committed to the highest standards of business conduct and seeks to maintain these standards
across all of its operations throughout the world. The Group has in place group finance policies and employee
procedures.
The Group has an appropriate organisation structure for planning, executing, controlling and monitoring
business operations in order to achieve Group objectives. Lines of responsibility and delegations of authority
are documented.
Additional Compliance Information
Additional Compliance Information in accordance with Appendix 9C of the Main Market Listing Requirements
of Bursa Malaysia Securities Berhad:
UTILISATION OF PROCEEDS RAISED FROM CORPORATE PROPOSALS

There were no proceeds raised from corporate proposals during the financial year.
158 SHARE BUY-BACK

There was no proposal by the Company to carry out a share buy-back during the financial year.
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OPTIONS, WARRANTS OR CONVERTIBLE SECURITIES

The Company did not issue any warrants or convertible securities during the financial year.
AMERICAN DEPOSITORY RECEIPT (“ADR”) OR GLOBAL DEPOSITORY RECEIPT (“GDR”)

PROGRAMME
The Company did not sponsor any ADR or GDR Programme during the financial year.
IMPOSITION OF SANCTIONS/PENALTIES
There were no public sanctions and/or penalties imposed on the Company and its subsidiaries, Directors or
Management by relevant regulatory bodies during the financial year.
VARIATION IN RESULTS
PROTON recorded an Audited Profit After Tax of RM218.9 million for the financial year ended 31 March
2010.
However, the Unaudited Financial Statement of PROTON for the same period (as announced to Bursa Malaysia
Securities Berhad on 26 May 2010), recorded and Unaudited Profit After Tax of RM239.1 million.
This represented a variation (of RM20.2 million or 8.45%) between the Audited and Unaudited Profit After Tax
for the said financial year and this was due to, additional provision for bonus (RM15.5 million), impairment
of plant and machinery (RM6.0 million), development cost written off (RM4.0 million), adjustment for tax
credit of RM4.0 million and other favourable adjustments amounting to RM1.3 million.
The variation was announced to Bursa Malaysia Securities Berhad on 30 July 2010 together with the Audited
Financial Statement of PROTON for the financial year ended 31 March 2010.

PROFIT GUARANTEE
There was no profit guarantee for the financial year.
MATERIAL CONTRACTS
There was no material contract entered into by the PROTON Group involving the interest of Directors and
major shareholders, either still subsisting at the end of the financial year ended 31 March 2010 or entered
into since the end of the previous financial year. 159
REVALUATION POLICY ON LANDED PROPERTIES
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The significant accounting policies on property, plant and equipment are disclosed in Note 3(c) of the
Summary of Significant Accounting Policies.
NON AUDIT FEES

During the financial year, the amount of non-audit fees paid and payable to the external auditors by the
Group are as follows:
2010 2009
External Auditors RM’000 RM’000
PricewaterhouseCoopers Malaysia 232 902
Member firm of PricewaterhouseCoopers International Limited 592 959
(a separate and independent legal entity from
PricewaterhouseCoopers Malaysia)
Total 824 1,861

RECURRENT RELATED PARTY TRANSACTIONS

On 8 June 2007, PROTON obtained exemption from Bursa Malaysia Securities Berhad (“Bursa”) from
disclosing Recurrent Related Party Transactions with Khazanah Nasional Berhad’s investee companies. As
a result, PROTON is not required to seek shareholders mandate for such transactions at the forthcoming
Annual General Meeting of the Company.
Further, Bursa had on 14 December 2006 amended the Listing Requirements pertaining to related party
160 transactions whereby the threshold for a major shareholder was increased from 5% to 10% of the aggregate
nominal amount of voting shares in a company, PROVIDED that the said shareholder is not the largest
shareholder of the company.
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The Employees Provident Fund Board (“EPF”) which currently holds approximately 10.720% of the issued
and paid up capital of PROTON is not deemed a related party by virtue of the fact that EPF and/or person(s)
connected with the EPF:
a. is/are not the largest shareholder of the Company
b. is/are not a party to any transaction, initiator, agent or involved in any manner in any transaction with the
PROTON Group; and
c. does not have any representative in an executive capacity on the Board of Directors of PROTON or any of
the subsidiaries.
The other major shareholder, Petroliam Nasional Berhad holds 7.851% equity interest in PROTON.

Below is a list of Recurrent Related Party Transactions entered during the financial year ended 31 March
2010.
Company Actual
within the 01/04/09 -31/03/10
Transacting Related Party Nature of Transaction PROTON Group RM
1 Lub Dagangan Sdn. Bhd. Purchase of lubricants PONSB 5,363,445

2 Petronas Dagangan Sdn. Bhd. Purchase of lubricants PONSB 3,187,700
161
3 Petronas Dagangan Sdn. Bhd. Purchase of lubricants PESB 20,540,634
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4 EON Sale of goods PESB 1,432,428,000
5 EON Sale of goods PPCSB 88,768,261
6 Johnson Controls Auto Holding Purchase of goods PPCSB 208,872
7 Johnson Controls Auto Seating Purchase of goods PONSB 91,975,085
8 Johnson Controls Auto Interior Purchase of goods PONSB 1,894,396
9 PPCSB Purchase of goods PONSB 2,426,273
10 PPCSB Sale of goods PONSB 20,744,978
11 PPCSB Purchase of parts PESB 122,571,114
12 PPCSB Sale of goods PCUKL 35,022
13 PPCSB Purchase of parts PCUKL 2,677,870
14 PPCSB Purchase of parts PCA 3,157,376
15 PPCSB Purchase of parts PSPL 451,661
16 PPCSB Purchase of parts PEI 2,144,429
17 Hicom Teck See Purchase of parts PONSB 152,165,343
18 Hicom Teck See Purchase of parts PPCSB 1,314,158
19 Tenaga Nasional Berhad Sale of goods PESB 931,800
20 Oriental Summit Industries Purchase of parts PONSB 62,167,936
21 Oriental Summit Industries Purchase of parts PPCSB 1,289,122
22 PHN Industry Sdn. Bhd. Purchase of goods PONSB 164,260,662
Definition:
PONSB Perusahaan Otomobil Nasional Sdn. Bhd.

PESB Proton Edar Sdn. Bhd.
PPCSB Proton Parts Centre Sdn. Bhd.
PCUKL Proton Cars (UK) Limited
PCA Proton Cars Australia Pty. Limited
PSPL Proton Singapore Pte. Limited
PEI PT Proton Edar Indonesia
Statement on Internal Control
THE MALAYSIAN CODE ON CORPORATE GOVERNANCE REQUIRES LISTED

COMPANIES TO MAINTAIN A SOUND SYSTEM OF INTERNAL CONTROL
TO SAFEGUARD SHAREHOLDERS’ INVESTMENTS AND THE GROUP’S
ASSETS. DIRECTORS OF LISTED COMPANIES ARE REQUIRED TO MAKE
DISCLOSURES IN THEIR ANNUAL REPORTS ON THE STATE OF INTERNAL
162 CONTROL IN ACCORDANCE WITH THE LISTING REQUIREMENTS OF
BURSA MALAYSIA SECURITIES BERHAD (“BURSA MALAYSIA”).
25 STERLING YEARS
Bursa Malaysia’s Statement on Internal Control: Guidance for Directors of

Public Listed Companies (“Guidance”) provides guidance for compliance
with these requirements. The Board’s Internal Control Statement, which
has been prepared in accordance with the Guidance, is set out below.
BOARD RESPONSIBILITY
The Board of Directors (“The Board”) recognises the importance of
sound internal controls and risk management practices to good corporate
governance. The Board has an overall responsibility for the Group’s
system of internal controls and its effectiveness, as well as reviewing
its adequacy and integrity. The Group’s system of internal controls is
designed to manage the principal business risks that may impede the
Group from achieving its business objectives. The system, by its nature,
can only provide reasonable but not absolute assurance against any
material misstatement or loss occurrence.
RISK MANAGEMENT
Risk management is regarded by the Board to be an integral part of the
Group’s operations with the objective of maintaining a sound internal
control system and ensuring its continuing adequacy and integrity. A
formal risk management framework and policy was approved by the Board
for the Group to identify, assess, treat, report and monitor, key risks
faced by the Group. The effectiveness of the risk mitigation actions are
reviewed quarterly by the Group Risk Management Committee (GRMC)
and Board Risk Management Committee (BRMC) respectively.
The Group Risk Management Division (GRMD) is entrusted with the

responsibility of ensuring that an appropriate risk management framework
exists within the Group and is effectively implemented to manage the
key risks of the organisation on an on-going basis.

The GRMC, which comprises of Senior Management, is responsible for overseeing risk management
implementation, regular updating of the Group’s risk profiles and improving the implementation methodology
for risk management. The Committee deliberates and determines the Group’s major risks to be escalated to
the attention of the BRMC.
163
The BRMC was established to deliberate major risks highlighted by the management and assist the Board in
25 STERLING YEARS
reviewing the Group’s risk policies and strategies.
For the financial year ended 31 March 2010, the GRMC and BRMC have held quarterly meetings in
accordance with their respective terms of reference.
ASSURANCE MECHANISM
Apart from risk management activities, the Board and Management have established other processes
for identifying, evaluating and managing significant risks faced by the Group. They continue to strive in
enhancing and implementing the internal control system to manage those risks that could affect the Group’s
growth and financial viability. These processes include updating the system of internal controls when there
are changes to the business environment or regulatory guidelines. The key elements of the Group’s control
environment include:
Board Committees
Board Committees were established by the Board to assist the Board in the execution of its responsibilities
to provide oversight on the effectiveness of the Group’s operations. The responsibilities and authority of the
Committees are governed by specific terms of reference and these Committees are accountable to the Board.
The Board Committees are:

• Board Audit Committee
• Board Nomination and Remuneration Committee
• Board Risk Management Committee (“BRMC”)
• Board Disciplinary Committee (“BDC”)
• Board Executive Committee (“EXCO”)
The details of the abovementioned Board Committees are set out and explained in the Statement on Corporate
Governance.
Board Audit Committee
The Board has delegated the duty of reviewing and monitoring the effectiveness of the Group’s system of
internal controls to the Board Audit Committee (BAC).
The BAC assumes the overall duties of reviewing with the external auditors their audit plan, audit report, as
well as their findings and recommendations on internal controls highlighted annually in the Internal Control
Memorandum. Throughout the financial year, the BAC was updated on the developments of Malaysian
164 Financial Reporting Standards, as well as legal and regulatory requirements. It also reviews the effectiveness
of the internal audit function with particular emphasis on the scope and quality of audits, resources as well
as the independence of the Group Internal Audit Division (GIAD).
25 STERLING YEARS
The BAC continues to meet regularly and has full and unimpeded access to the internal and external auditors
and all employees of the Group.
Further information relating to the activities of the BAC is set out in the Statement on Corporate Governance.
Organisation Structure and Management Committees
An organisation structure, which is aligned to the business and operational requirements and led by Heads
of Division with clearly defined lines of responsibility, accountability and levels of authority, is in place to
assist in implementing the Group’s strategies and day-to-day business activities.
Various functional committees were set up at the management level to ensure the Group’s actions and
operations are properly aligned towards achieving the organisation’s goals and objectives.
Group Internal Audit Division (GIAD)
GIAD continues to independently monitor compliance with internal policies and procedures, effectiveness
of the internal control systems and highlights significant findings for corrective actions by line management
and reports directly to the BAC.
The annual audit plan which covers PROTON and its subsidiary companies and which was established
primarily on a risk-based approach, is reviewed and approved by the BAC annually. A quarterly work status
update is given by the GIAD to the BAC. GIAD regularly reviews the approved annual audit plan to ensure
significant risk areas are given adequate audit focus.
The interests of PROTON in associated companies and jointly controlled entities are primarily served
through representation on the board of directors of the respective companies. Internal controls of associated
companies and jointly controlled entities are reviewed upon any ad-hoc request by the BAC.
On a quarterly basis, GIAD updates the BAC on the status of corrective actions taken by line management
arising from the audit findings highlighted by both GIAD and the external auditors.
Further information relating to the activities of GIAD is set out in the Statement on Corporate Governance.

OTHER KEY ELEMENTS OF INTERNAL CONTROL
The other key elements of the Group’s internal control systems are described below:-
• Defined delegation of responsibilities to committees and management of head office and operating
units, including authorisation levels for various aspects of the business, which are clearly set out in the
revised Limits of Authority approved by the Board on 29th May 2009;
• Documented internal policies and procedures as set out in the Group Policies and Procedures. Perusahaan 165
Otomobil Nasional Sdn. Bhd., a wholly owned subsidiary, and Proton Casting Plant have been officially
certified and successfully upgraded to ISO 9001:2008 from ISO 9001:2000 by Vehicle Certification
25 STERLING YEARS
Agency (VCA) and SIRIM on the Quality System Procedures for PROTON;
• Quarterly financial statements and the Group’s performance are deliberated by the BAC, which
subsequently presents them to the Board for their review, consideration and approval;
• Management Committee meetings are held on a regular basis to identify, discuss and resolve operational,
financial and key management issues;
• A comprehensive budgeting process where the annual budgets are approved by the Board;
• The Board receives and reviews monthly reports from Management on key strategic and operational
issues and provides direction to Management;
• Regular visits to operating units by Senior Management;
• Various improvement programs were established in PROTON and its subsidiaries to enhance its business
operations;
• Continuous training efforts to enhance the leadership quality and competency of the workforce;
• Regular employee perception surveys were conducted to obtain feedback from employees to promote
continuous improvements; and
• Improvement to the formal employee appraisal system for effective coaching and evaluation of employee
performance using established Key Performance Indicators (KPIs). The resolution rate of internal audit
findings is also included in the Division KPIs to ensure gaps in the internal controls system are effectively
and timely addressed.
CONCLUSION
For the financial year under review, some weaknesses in internal control were detected. However, after due
and careful inquiry and based on the information and assurance provided, the Board is satisfied that there
were no material losses as a result of weaknesses in the system of internal controls. Nevertheless, identified
areas of concern are accorded closer attention and more regular monitoring to ensure key internal controls
are adequate and effective to continually safeguard shareholders’ investment and the Group’s assets.
Risk Management
THE INCREASING DYNAMICS AND CHALLENGES IN THE BUSINESS

ENVIRONMENT CALLS FOR A PROACTIVE RISK MANAGEMENT
OPERATION. THE YEAR UNDER REVIEW SAW A MORE STRUCTURED
AND HOLISTIC APPROACH TO THE ENTERPRISE RISK MANAGEMENT
OPERATION TO ENSURE THE GROUP REMAINS COMPETITIVE IN THE
166 GLOBAL AUTOMOTIVE MARKET.
25 STERLING YEARS
OVERVIEW
The Group recognizes the importance of an effective risk management
system throughout the organisation to provide reasonable assurance to
the shareholders that the risks the Group is exposed to, are properly
managed, controlled and capitalised.
As part of the Group’s improvement program, Proton Risk Management

Framework, formulated in 2003 has been continuously enhanced in line
with the ISO31000:2009 as the latest international risk management
standard of reference.
RISK MANAGEMENT FRAMEWORK

Proton’s risk management framework is designed to provide the foundation
for organisational arrangements, implementation, and monitoring,
reviewing and managing key risks throughout the organisation.
Risk Management

Risk Policy and Strategy
The Group Risk Management policy revised in 2007, remains essential in integrating risk management into
key activities and business processes of the Group. As recommended in Khazanah’s Green Book, factors on
risk management were continuously incorporated to that of PROTON’s ERM strategy. This is essential for the
Group to respond effectively to the fast changing business environment as well as to protect and enhance
stakeholders’ interest.
167
Sets the company risk Understands and manages Considers the risk factors
parameters major risk exposures in all major decisions
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Overall corporate risks
Provide sufficient internal Culture of identifying
are measured & thresholds
controls, clear accountabilities & managing risks exists
are controlled within
and mitigation plans. throughout the organisation.
predetermined limits.
Communication & Cascading Strategy Reporting Platform
Group risk
monitoring platform
PROTON GROUP RISK (BRMC)
(CRP/ORP)
ENGINEERING & MARKETING SUPPORT Group Risk

MANUFACTURING & SALES SERVICES Management
Division
Product Planning Communication Strategy
Engineering Marketing Finance Divisional risk

monitoring platform
(GRMC)
Procurement Export Human Resource
Quality Domestic ICT

Functional risk
Manufacturing Parts Compliance Group
monitoring platform
(Risk Champions)
Risk Management
In ensuring that the Strategic and Operational Risks were effectively communicated and monitored at all
levels, the Group has developed Proton Risk Management Communication Platform to cascade down the risk
management strategy into various key divisions. This includes Group Risk Monitoring platform; monitored
through Board Risk Management Committee (BRMC), Divisional Risk Monitoring platform; monitored
through Group Risk Management Committee (GRMC) and Functional Risk Monitoring platform monitored by
Business Units Risk Team/Risk Champion.
168 Group Risk Management Division (GRMD) provides specialized resources for developing risk framework,
policies, methodologies, tools and appropriate training for Managers to ensure the risk management practices
is effectively integrated into business initiatives.
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MAJOR INITIATIVES
Business Planning Risk Assessments
Group wide risk registrations were conducted in conjunction with the business planning initiatives and
escalated to GRMC and BRMC respectively. All divisions within the Group, including subsidiaries have
submitted their risk profiles during this exercise. The risks collated were then prioritized and categorized into
Corporate Risk Profiles (CRP), Operational Risk Profiles (ORP) and Business Units Risk Profiles (BURP).
Risk Management Brainstorming and Profiling Sessions
A series of risk awareness and profiling workshops were conducted throughout the year involving Export
Market Division, Group Information, Communication and Technology (ICT), Group Marketing and Sales,
Group Support Services, Group Engineering and Operations and also the Board and Senior Management. The
objective of these sessions was to obtain risks views across the business value chain and inculcate a more
positive approach to risk management practices.
Global Emerging Risk Assessments
Several risk assessments pertaining to global issues were conducted during the year in review, specifically
i.e. HINI pandemic and travel to high risk countries. The taskforce comprising, Group Human Resources
Division, Group Security, Environment, Safety and Health (EHS) Department was established particularly to
review and advise the Group in managing the emerging risks and related business exposures.
Risk Management

RISK FACTORS
Corporate and Operational Risks
Corporate risks are primarily risks caused by external events that have potential impact on the strategic
decision or activities of the Group. The Board is responsible in ensuring that the corporate risks of the Group
are identified proactively. This was performed via product development, quality improvement and process
improvement programs.
169
Operational risk is defined as the risk of loss resulting from inadequacy or failure of internal processes,
people and system. As the Group progresses towards operational excellence, the Group faces a multitude
25 STERLING YEARS
risks relating to financial risks, vendor capacity and capability in achieving business objectives. Appropriate
measures were undertaken to ensure that controls are in place to avoid any disruption of operations.
Export Market Risks
Proton conducts its businesses across regions. This exposed the Group to risks such as changes in market
regulation, infringement of Intellectual Property Rights (IPR) and stiff market competition which may
impact the Group’s ultimate objectives. As the Group’s future lies in expanding into the export markets, it
is imperative that efforts are taken to ensure that a risk faced by the organisation is effectively managed.
Various risk assessments were performed in the year in review specifically for our operations in China,
Middle East and Asean. Updates on mitigation plan were reported to the GRMC and BRMC respectively on
a quarterly basis.
Business Environment Risk
Business environment risk is inherent in all businesses. The strengthening global call for reduction in
greenhouse gas emissions is now widely acknowledged in both developed and developing nations and is a
catalyst for the “Green Vehicle” concept to be promoted. In view of this challenge, the Group has deliberated
the challenges and opportunities in the green technology and ways to catapult this idea into a feasible end
state.
CONCLUSION
Providing assurance that risks are effectively managed requires commitment and discipline from all divisions.
Enhancement on ERM framework and competency will remain the top priority of the Group to cultivate a
more proactive risk management operation.
Managing key risks and identifying emerging risks especially in export markets will also be the Group’s focus
to catapult the Company into being a major international player. Concerted efforts on all fronts are crucial to
maintain the commitment of all divisions towards embedding risk management practices as an integral part
of the day-to-day decision making process in the organisation.
With the support of the BRMC, the risk management function will continue to move forward in enhancing
the appreciation of risk management and strive for a stronger and more resilient risk management culture
within the Group.
CALENDAR OF EVENTS
170
1 2
25 STERLING YEARS
3 4 5
AUG 09 SEP 09
1 Flag off for the PROTON Merdeka Convoy 3 PROTON Adviser Tun Dr. Mahathir
to various charity homes in Pulau Pinang, Mohamad joins PROTON’s Buka Puasa
Kelantan, Perak and Selangor. function with staff and orphans at
PROTON’s main plant in Shah Alam,
2 PROTON holds its 2009 AGM at the Selangor.
PROTON Centre of Excellence.
OCT 09
4 Miss Australia unveils the Proton S16
(Saga) at the Australian National Dealers
Conference held in Kuala Lumpur.
DYMM Yang di-Pertuan Agong Tuanku

5
Mizan Zainal Abidin visits Lotus
headquarters in Norwich, UK.
Calendar of Events

171
6 7 8
25 STERLING YEARS
9 10 11
OCT 09 NOV 09
6 DYMM Yang di-Pertuan Agong Tuanku 10 YB Dato’ Ahmad Shabery Cheek, Minister
Mizan Zainal Abidin unveils the new Proton of Youth and Sports visits Lotus UK.
Higher Performance Engine at Lotus UK.
11 PROTON’s entry in the Rally of China.
PROTON Chairman, Dato’ Sri Mohd Nadzmi
7
handing out “Duit Raya” during the Hari Raya
Aidilfitri gathering with business associates
and children from local orphanages.
Deputy Minister of Works YB Dato’ Yong

8
Khoon Seng launches the 18th Malaysian
Skills Competition co-organised by PROTON.
9 Nikolay Davydenko in action during the

inaugural PROTON Malaysian Open Kuala
Lumpur 2009 (Tennis Tournament).
Calendar of Events
172
12 13
25 STERLING YEARS
14 15 16
NOV 09 DEC 09
12 PROTON goes a step further in soccer by 15 Proton Exora named as the Midi MPV of
launching the PROTON FC Soccer Kids the Year 2009 by the New Straits Times/
programme. Maybank Car of the Year Awards 2009.
13 Announcement of Official Proton Car Clubs 16 PROTON signs MOU with the Manpower
as brand ambassadors at the inaugural Department of the Ministry of Human
PROTON and Car Clubs Collaboration Resources, pledging support to develop an
Briefing. Automotive Skills Programme.
Proton Exora wins the 2009 Car of The

14
Year Award for Small/Medium MPV at the
Autocar Asean Awards 2009.
Calendar of Events

173
17 18 19
25 STERLING YEARS
20 21 22
JAN 10 20 YB Dato’ Maznah Mazlan, Deputy Minister

of Human Resources visits Taska PROTON
(a day care centre for children of PROTON
17 Tun Dr. Mahathir Mohamad with the staff).
winners of the PROTON Invention and
Innovation competition during the 2010 PROTON continues its support for national
21
PROTON Family Day. badminton by sponsoring the PROTON
Malaysia Open 2010.
The 2010 Family Day held at the Shah
18
Alam plant saw the presence of more than A friendly shooting competition with the
22
10,000 staff including family members Selangor contingent of the Royal Malaysian
from PROTON’s central region. Police.
19 Jobseekers throng PROTON’s Career Day

which was held at the Shah Alam office.
Calendar of Events
174
23 24 25
25 STERLING YEARS
26 27 28
FEB 10 26 PROTON Adviser, Tun Dr. Mahathir

Mohamad receives a full business and
technology briefing from Dany Bahar,
The Grand Prize winner of the Proton Drive Chief Executive Officer of Lotus Group,
23
for Holidays campaign wins RM7,000 in at the plant in Hethel, Norwich, United
cash and a 3 days 2 nights hotel package. Kingdom.
PROTON continues its support for the Le

24
Tour de Langkawi with its convoy of cars. MAR 10
25 PROTON supports the National Level The unveiling of the EMAS concept global
PINTAR Creativity and Innovation 27
cars at the prestigious 80th International
Competition held at the Sekolah Geneva Motor Show.
Kebangsaan Permatang Buloh, Kepala
Batas, Penang. Launch of the Persona Elegance, a better
28
value for money mid-sized sedan.
Calendar of Events

175
29 30 31
25 STERLING YEARS
32 33 34
29 The launch of the Proton Satria Neo R3 32 PROTON’s Adviser Tun Dr. Mahathir
Lotus Racing Edition in conjunction with Mohamad visits the R&D facilities and
PROTON’s involvement in Formula One. plant in Shah Alam.
YAB Dato’ Ahmad Shabery Cheek Minister

APR 10 33
of Youth and Sports hands the Jalur
Gemilang to the PROTON R3 Malaysia
The Lotus Racing team roars its engine at Rally Team.
30
the Formula 1 World Championship race in
Sepang. Winner of PROTON’s 25th Anniversary
34
logo designing competition receives her
Quality remains a top priority with the prize from the Managing Director during
31
launch of the annual Company-wide the launch of PROTON’s 25th Anniversary
Quality Campaign which was officiated by celebration.
PROTON’s Managing Director.
Calendar of Events
176
35 36 37
25 STERLING YEARS
38 39 40
MAY 10 JUN 10
35 PROTON participated in the SMIDEX 2010 38 Grand Prize Winner at PROTON’s Media
exhibition at the KL Convention Centre. Night in conjunction with PROTON’s
25th Year Anniversary, receiving his gift
36 PROTON showcased the Exora at the from the Chairman of PROTON.
Automotive Engineering Exposition (AEE)
2010 in Yokohama, Japan’s largest The launch of the much-anticipated
39
automotive exhibition and technology all-new Lotus Evora sports car in Malaysia.
showcase.
40 Proton Edar Service Conference held in Port
President Mohamed Nasheed of the Dickson, Negeri Sembilan was attended by
37
Republic of Maldives visits the PROTON 700 participants.
booth at the 6th World Islamic Economic
Forum held in Kuala Lumpur.
Calendar of Events

177
41 42
25 STERLING YEARS
43
JUL 10
41 The EMAS concept global car was unveiled
in Malaysia by the Prime Minister, YAB
Dato’ Sri Mohd Najib Tun Razak during
PROTON’s 25th Anniversarry Gala Dinner.
Prime Minister Dato’ Sri Mohd Najib Tun

42
Razak launched PROTON’s 25th Anniversary
commemorative book, “A Saga - PROTON’s
25 year story”.
The launch of the stunning and newly

43
improved Proton Exora.
Foresight, partnership and commitment have kept PROTON
cruising through different economic terrains. Our focus on
the future ensures we remain on track and elevate our passion
to enhance our performance and repute. We now train our
sights on global possibilities and are creating vehicles that
meet international standards first, so as to expand our export
earnings.
We deliver better results everyday.
Roaring Towards A New Dawn

STATUTORY FINANCIAL STATEMENTS
182 Directors’ Report
185 Income Statements
186 Balance Sheets
188 Consolidated Statement Of Changes In Equity
189 Company Statement Of Changes In Equity
190 Cash Flow Statements
193 Notes To The Financial Statements
284 Statement by Directors
284 Statutory Declaration
285 Independent Auditors Report
Directors’ Report
THE DIRECTORS HAVE PLEASURE IN SUBMITTING THEIR REPORT

TOGETHER WITH THE AUDITED FINANCIAL STATEMENTS OF THE GROUP
AND COMPANY FOR THE FINANCIAL YEAR ENDED 31 MARCH 2010.
PRINCIPAL ACTIVITIES
182 The Company is principally involved in investment holding activities.
The principal activities of the subsidiary companies, associated companies and jointly controlled entities are
set out in Notes 17 to 19 of the financial statements. There have been no significant changes in the activities
25 STERLING YEARS
of the Group and Company during the financial year.
FINANCIAL RESULTS
Group Company
RM’000 RM’000
Net profit for the financial year 218,932 98,715
DIVIDENDS
No dividends on ordinary shares were paid or declared by the Company since 31 March 2009.
The Directors recommend the payment of a final dividend of 20 sen per ordinary share less tax at 25% on
549,213,002 ordinary shares amounting to RM82,381,950 in respect of the financial year ended 31 March
2010, subject to the approval of members at the forthcoming Annual General Meeting.
RESERVES AND PROVISIONS

There were no material transfers to or from reserves and provisions during the financial year except as disclosed
in the financial statements.
Directors’ Report (continued)

DIRECTORS
The Directors who have held office during the period since the date of the last report are:
Dato’ Mohd Nadzmi bin Mohd Salleh

Dato’ Syed Zainal Abidin B Syed Mohamed Tahir
Dato’ Lim Heen Peok
Dato’ Zalekha binti Hassan
Behara Venkata Rama Subbu (appointed on 1.3.2010)
Tan Sri Rainer Althoff (appointed on 22.6.2010)
Abdul Rahim bin Abdul Hamid (appointed on 20.7.2010) 183
Haji Abdul Kadir bin Md Kassim (resigned on 27.5.2010)
Oh Kim Sun (resigned on 27.5.2010)
25 STERLING YEARS
Haji Abdul Jabbar bin Abdul Majid (retired on 21.8.2009)
In accordance with Article 104 of the Company’s Articles of Association, Dato’ Zalekha binti Hassan retires at
the forthcoming Annual General Meeting and, being eligible, offers herself for re-election.
In accordance with Article 111 of the Company’s Articles of Association, Behara Venkata Rama Subbu, Tan Sri
Rainer Althoff and Abdul Rahim bin Abdul Hamid retire at the forthcoming Annual General Meeting and, being
eligible, offer themselves for election.
DIRECTORS’ BENEFITS
During and at the end of the financial year, no arrangements subsisted to which the Company is a party, being
arrangements with the object or objects of enabling Directors of the Company to acquire benefits by means of
the acquisition of shares in, or debentures of, the Company or any other body corporate.
Since the end of the previous financial year, no Director has received or become entitled to receive a benefit
(other than benefits disclosed as Directors’ remuneration in Note 8 to the financial statements) by reason of a
contract made by the Company or a related corporation with the Director or with a firm of which the Director is
a member, or with a company in which the Director has a substantial financial interest.
DIRECTORS’ INTEREST IN SHARES AND DEBENTURES

According to the register of Directors` shareholdings, no Director in office at the end of the financial year held
any interest in shares or debentures in the Company or its related corporations.
STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS

Before the income statements and balance sheets of the Group and Company were made out, the Directors
took reasonable steps:
(a) to ascertain that proper action had been taken in relation to the writing off of bad debts and the making of
allowance for doubtful debts and satisfied themselves that all known bad debts had been written off and
that adequate allowance had been made for doubtful debts; and
(b) to ensure that any current assets, other than debts, which were unlikely to realise in the ordinary course
of business their values as shown in the accounting records of the Group and Company had been written
down to an amount which they might be expected so to realise.
Directors’ Report (continued)
STATUTORY INFORMATION ON THE FINANCIAL STATEMENTS (continued)

At the date of this report, the Directors are not aware of any circumstances:
(a) which would render the amounts written off for bad debts or the amount of the allowance for doubtful
debts in the financial statements of the Group and Company inadequate to any substantial extent; or
(b) which would render the values attributed to current assets in the financial statements of the Group and
Company misleading; or
(c) which have arisen which render adherence to the existing method of valuation of assets or liabilities of the
184 Group and Company misleading or inappropriate.
No contingent or other liability has become enforceable or is likely to become enforceable within the period of
25 STERLING YEARS
twelve months after the end of the financial year which, in the opinion of the Directors, will or may substantially
affect the ability of the Group and Company to meet their obligations when they fall due.
At the date of this report, there does not exist:
(a) any charge on the assets of the Group or the Company which has arisen since the end of the financial year
which secures the liability of any other person; or
(b) any contingent liability of the Group or the Company which has arisen since the end of the financial year.
At the date of this report, the Directors are not aware of any circumstances not otherwise dealt with in this report
or the financial statements which would render any amount stated in the financial statements misleading.
In the opinion of the Directors:
(a) the results of the Group’s and Company’s operations during the financial year were not substantially
affected by any item, transaction or event of a material and unusual nature except as disclosed in Notes
5, 7 and 13 to the financial statements; and
(b) there has not arisen in the interval between the end of the financial year and the date of this report any
item, transaction or event of a material and unusual nature likely to affect substantially the results of the
operations of the Group or the Company for the financial year in which this report is made.
AUDITORS
The auditors, PricewaterhouseCoopers, have expressed their willingness to continue in office.
Signed on behalf of the Board of Directors in accordance with their resolution dated 27 July 2010.
DATO’ MOHD NADZMI BIN MOHD SALLEH DATO’ SYED ZAINAL ABIDIN B
CHAIRMAN SYED MOHAMED TAHIR
MANAGING DIRECTOR
Income Statements
For The Financial Year Ended 31 March 2010

Group Company
2010 2009 2010 2009
Note RM’000 RM’000 RM’000 RM’000
Revenue 6 8,226,859 6,518,754 101,203 362,357

Cost of sales 7 (7,616,732) (6,145,328) - -
Gross profit 610,127 373,426 101,203 362,357
Other operating income
- Research and development grant 143,688 80,656 - -
- Others 181,232 165,711 3,454 7,321 185
Distribution costs (132,598) (118,253) - -
Administrative expenses (546,584) (516,886) (1,004) (1,329)
25 STERLING YEARS
Other operating expenses
- Impairment of property, plant
and equipment 13 (6,000) (257,674) - -
- Impairment of capitalised
development cost 16 - (20,802) - -
- Write back of impairment of property,
plant and equipment 13(b) 53,447 1,616 - -
- Others (49,136) (47,401) (4,375) -
Profit/(loss) before finance cost 7 254,176 (339,607) 99,278 368,349
Finance cost 9 (12,053) (14,408) - -
Share of results of associated companies 18 5,535 20,220 - -
Share of results of jointly controlled entities 19 13,235 14,594 - -
Profit/(loss) before taxation 260,893 (319,201) 99,278 368,349
Taxation 10 (41,961) 17,395 (563) (1,179)
Profit/(loss) for the financial year 218,932 (301,806) 98,715 367,170
Attributable to:
Equity holders of the Company 218,932 (301,806) 98,715 367,170
Earnings/(loss) per share (sen)

- basic 11 40 (55)
- diluted 11 40 (55)
Dividend per share (sen)

- interim dividend paid 12 - 5
- final dividend proposed 12 20 -
The notes on pages 193 to 283 form part of these financial statements.
Balance Sheets
As At 31 March 2010
Group Company
2010 2009 2010 2009
Note RM’000 RM’000 RM’000 RM’000
NON-CURRENT ASSETS
Property, plant and equipment 13 2,624,418 2,827,111 - -

Prepaid land lease payments 14 - - - -
Goodwill 15 29,008 29,008 - -
186 Intangible assets 16 563,963 431,668 - -
Subsidiary companies 17 - - 1,708,651 1,708,651
Associated companies 18 152,640 158,367 13,600 13,600
25 STERLING YEARS
Jointly controlled entities 19 202,545 195,622 - -

Amounts due from subsidiary companies 20 - - 232,946 177,870
Investments 21 - 10,397 - 6,475
Deferred tax assets 22 15,033 5,727 - -
3,587,607 3,657,900 1,955,197 1,906,596
CURRENT ASSETS
Inventories 23 1,227,212 1,395,081 - -

Trade and other receivables 24 920,400 890,095 749 145
Amounts due from subsidiary companies 20 - - 59,978 58,912
Amounts due from associated companies 25 34,615 18,284 350 -
Amounts due from jointly
controlled entities 26 11,321 11,353 - -
Tax recoverable 10 25,301 160,610 292 77
Current investments 27 9,676 15,313 - -
Dividends receivable - - 6,600 -
Deposits, bank and cash balances 28 1,652,089 913,850 248,376 209,423
3,880,614 3,404,586 316,345 268,557
Non-current assets held for sale 29 36,931 36,412 2,100 -
TOTAL ASSETS 7,505,152 7,098,898 2,273,642 2,175,153
Balance Sheets
As At 31 March 2010 (continued)

Group Company
2010 2009 2010 2009
Note RM’000 RM’000 RM’000 RM’000
CAPITAL AND RESERVES
Share capital 30 549,213 549,213 549,213 549,213

Reserves 31 4,783,776 4,552,327 1,723,894 1,625,179
Equity attributable to equity holders
of the Company 5,332,989 5,101,540 2,273,107 2,174,392 187
TOTAL EQUITY 5,332,989 5,101,540 2,273,107 2,174,392
25 STERLING YEARS
NON-CURRENT LIABILITIES
Long term liabilities 32 88,650 101,516 - -

Deferred tax liabilities 22 10,740 12,243 - -
99,390 113,759 - -
CURRENT LIABILITIES
Trade and other payables 33 1,630,364 1,277,658 535 482

Provisions 34 184,404 189,779 - -
Amounts due to associated companies 35 79,730 88,606 - -
Amounts due to jointly
controlled entities 36 23,940 15,195 - -
Taxation 12,099 6,322 - 279
Short term borrowings 37 142,236 306,039 - -
2,072,773 1,883,599 535 761
TOTAL LIABILITIES 2,172,163 1,997,358 535 761
TOTAL EQUITY AND LIABILITIES 7,505,152 7,098,898 2,273,642 2,175,153
Net assets per share attributable to equity

holders of the Company (RM) 9.71 9.29
Consolidated Statement Of Changes In Equity
Attributable to equity holders of the Company

Asset Foreign
Share Capital revaluation exchange Retained
capital reserve reserve reserve earnings Total
Note RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
At 1 April 2009 549,213 475,617 2,362 (79,512) 4,153,860 5,101,540
Net income
188 recognised directly
in equity
- Foreign exchange
differences on
25 STERLING YEARS
translation of
foreign operations - - - 12,517 - 12,517
Profit for the
financial year - - - - 218,932 218,932
Total recognised
income and
expense for the
financial year - - - 12,517 218,932 231,449
At 31 March 2010 549,213 475,617 2,362 (66,995) 4,372,792 5,332,989
At 1 April 2008 549,213 475,617 2,362 (82,197) 4,476,261 5,421,256
Net income
recognised directly
in equity
- Foreign exchange
differences on
translation of
foreign operations - - - 2,685 - 2,685
Loss for the
financial year - - - - (301,806) (301,806)
Total recognised
income and
expense for the
financial year - - - 2,685 (301,806) (299,121)
Interim dividend
for the financial
year ended
31 March 2009 12 - - - - (20,595) (20,595)
At 31 March 2009 549,213 475,617 2,362 (79,512) 4,153,860 5,101,540
Company Statement Of Changes In Equity

Issued and fully
paid ordinary shares Distributable
Nominal
Number value of Retained
Note of shares RM1 each earnings Total
‘000 RM’000 RM’000 RM’000
At 1 April 2009 549,213 549,213 1,625,179 2,174,392
Profit for the financial year - - 98,715 98,715

189
At 31 March 2010 549,213 549,213 1,723,894 2,273,107
25 STERLING YEARS
At 1 April 2008 549,213 549,213 1,278,604 1,827,817
Profit for the financial year - - 367,170 367,170

Interim dividend for the financial year
ended 31 March 2009 12 - - (20,595) (20,595)
At 31 March 2009 549,213 549,213 1,625,179 2,174,392
Cash Flow Statements
Group Company
2010 2009 2010 2009
Note RM’000 RM’000 RM’000 RM’000
CASH FLOWS FROM

OPERATING ACTIVITIES
Profit/(loss) for the financial year 218,932 (301,806) 98,715 367,170
Adjustments for:
190 Taxation 41,961 (17,395) 563 1,179
Property, plant and equipment:
- depreciation 432,612 450,346 - -
25 STERLING YEARS
- written off 23,806 38,746 - -

- impairment 6,000 257,674 - -
- reversal of impairment (53,447) (1,616) - -
- (gain)/loss on disposal (2,645) 19,417 - -
Write down of inventories 80,128 114,950 - -
Impairment of investment in
an associated company - 6,678 - -
Investment:
- reversal of impairment (2,100) - (2,100) -
- provision for diminution in value 10,397 - 6,475 -
Intangible assets:
- amortisation 81,688 48,493 - -
- impairment - 20,802 - -
- written off 55,814 - - -
Interest expense 12,053 14,408 - -
Interest income (28,546) (42,089) (3,437) (4,618)
Share of results of
associated companies (5,535) (20,220) - -
Share of results of jointly
controlled entities (13,235) (14,594) - -
Current investments:
- loss on disposal 19 44 - -
- provision for diminution in value 282 1,084 - -
Reversal of allowance for
doubtful debts (23,534) (63,315) - -
Bad debts written off 19,359 - - -
Allowance for doubtful debts 27,183 45,616 - -
Loss/(gain) on unrealised
foreign exchange 26,617 (8,284) - -
Cash from operations
(carried forward) 907,809 548,939 100,216 363,731
For The Financial Year Ended 31 March 2010 (continued)

Group Company
2010 2009 2010 2009
Note RM’000 RM’000 RM’000 RM’000
CASH FLOWS FROM OPERATING

ACTIVITIES (continued)
Cash from operations

(brought forward) 907,809 548,939 100,216 363,731
Provision for warranties 45,968 45,149 - - 191

Provision for onerous contract - 22,139 - -
Research and development grant (143,688) (80,656) - -
25 STERLING YEARS
Provision/(reversal) for
retirement benefits 4,970 (8,042) - -
Amortisation of capital grant (31,255) (21,646) - -
Dividend income (915) (1,260) (101,203) (362,357)
Cash from/(used in) operations
before working capital changes 782,889 504,623 (987) 1,374
Changes in working capital:
Inventories 95,382 (445,982) - -
Receivables
- trade and other receivables 66,773 161,578 - (131)
- subsidiary companies - - (62,742) 7,307
- associated companies and
jointly controlled entities (16,928) (14,688) (350) -
Payables
- trade and other payables 313,480 139,693 53 (93)
- provisions (49,651) (102,257) - -
- subsidiary companies - - - (7,936)
- associated companies and
jointly controlled entities (170) 6,606 - -
Cash generated from/
(used in) operations 1,191,775 249,573 (64,026) 521
Tax paid (38,389) (31,550) (1,057) (704)

Tax refund 126,444 9,717 - -
Interest received 27,282 47,047 2,833 4,618
Interest paid (8,009) (12,394) - -
Retirement benefits paid (9,013) (9,369) - -
Net cash flow generated from/
(used in) operating activities 1,290,090 253,024 (62,250) 4,435
For The Financial Year Ended 31 March 2010 (continued)
Group Company
2010 2009 2010 2009
Note RM’000 RM’000 RM’000 RM’000
CASH FLOWS FROM

INVESTING ACTIVITIES
Purchase of property, plant

and equipment (145,330) (426,509) - -
192 Proceeds from acquisition of
a subsidiary company 17 - 3,998 - -
Purchase of intangible assets (271,707) (237,632) - -
25 STERLING YEARS
Purchase of current investments - (58) - -

Proceeds from disposal of
current investments 5,336 4,439 - -
Proceeds from disposal of
property, plant and equipment 6,469 29,073 - -
Dividends received 12,959 20,590 101,203 377,157
Net cash flow (used in)/generated
from investing activities (392,273) (606,099) 101,203 377,157
CASH FLOWS FROM

FINANCING ACTIVITIES
Dividend paid 12 - (20,595) - (20,595)
Proceeds from borrowings 211,358 356,506 - -
Advances to a subsidiary company - - - (177,870)
Lease and hire purchase
creditors installments paid (4,368) (6,113) - -
Repayment of borrowings (386,739) (195,421) - -
Receipt of restricted ADF 60,777 681 - -
Release of restricted ADF (54,732) (31,557) - -
Net cash flows (used in)/generated
from financing activities (173,704) 103,501 - (198,465)
NET INCREASE/(DECREASE) IN
CASH AND CASH EQUIVALENTS 724,113 (249,574) 38,953 183,127
EFFECTS OF EXCHANGE
DIFFERENCES (17,387) (24,982) - -
CASH AND CASH EQUIVALENTS
AT THE BEGINNING OF THE
FINANCIAL YEAR 899,383 1,173,939 209,423 26,296
CASH AND CASH EQUIVALENTS AT
THE END OF THE FINANCIAL YEAR 43 1,606,109 899,383 248,376 209,423
Notes To The Financial Statements
31 March 2010

1 GENERAL INFORMATION
The Company is principally involved in investment holding activities.
The principal activities of the subsidiary companies, associated companies and jointly controlled entities
are set out in Notes 17 to 19 to the financial statements. There have been no significant changes in the
activities of the Group and Company during the financial year.
The Company is a public limited liability company incorporated, and domiciled in Malaysia, and listed on
the Main Market of Bursa Malaysia Securities Berhad.
The address of the registered office and the principal place of business of the Company is: 193
Centre of Excellence
25 STERLING YEARS
KM 33.8, Westbound Shah Alam Expressway
47600 Subang Jaya
Selangor Darul Ehsan
Malaysia
2 BASIS OF PREPARATION
During the financial year, the Group recorded a net profit of RM219 million (2009: net loss for the financial
year of RM302 million) which was substantially due to the introduction of more saleable models with
better profit margins, and to a lesser extent, write-back of impairment of property, plant and equipment no
longer required. The loss in the previous financial year arose largely from the inclusion of impairment of
property, plant and equipment and intangible assets amounting to RM278 million and inventories write-
down of RM82 million relating to certain vehicle models which were impacted by contraction in sales
volume.
Going concern assumption
The Directors are of the opinion that the use of the going concern assumption in the preparation of the
financial statements is appropriate based on the approved Group business plans and available financing
arrangements. This includes efforts to control cash flows and the introduction of a new model as replacement
for aged models, as well as refreshers during the current financial year.
The Directors expect the Group to continue to operate as a going concern and accordingly, the assets and
liabilities of the Group and Company are recorded on the basis that the Group and Company will be able
to realise its assets and discharge its liabilities in the normal course of business.
31 March 2010 (continued)
2 BASIS OF PREPARATION (continued)

Estimates and judgements
The preparation of financial statements requires the Directors to make estimates and judgements that
affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities
at the date of the financial statements and the reported amounts of revenues and expenses during the
financial year. It also requires the Directors to exercise their judgements in the process of applying the
Group’s and the Company’s accounting policies. Although these estimates and judgements are based on
the Directors’ best knowledge of current events and actions, actual results may differ.
194 The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates
are significant to the Group’s financial statements are disclosed in Note 4 to the financial statements.
25 STERLING YEARS
Financial Reporting Standards
The financial statements of the Group and of the Company have been prepared in accordance with the
provisions of the Companies Act, 1965 and comply with the Financial Reporting Standards (‘FRSs’),
Malaysian Accounting Standard Board (‘MASB’) Approved Accounting Standards in Malaysia for Entities
Other than Private Entities.
The financial statements of the Group and Company have been prepared under the historical cost convention
(as modified by the revaluation of certain freehold land), unless otherwise indicated in the summary of
significant accounting policies.
(a) Standards, amendments to published standards and Issues Committee (‘IC’) interpretations that are
effective and applicable to the Group
There are no new accounting standards, amendments to published standards and interpretations to
existing standards effective for the financial year beginning 1 April 2009.
(b) Standards, amendments to published standards and IC interpretations that are not yet effective and
have not been early adopted
The new standards and interpretations that are applicable to the Group and the Company, but which
the Group and the Company have not early adopted:
• FRS 3 “Business Combinations” (effective prospectively from 1 July 2010). The revised standard
continues to apply the acquisition method to business combinations, with some significant
changes. That is, all payments to purchase a business are to be recorded at fair value at the
acquisition date, with contingent payments classified as debt subsequently re-measured through
the income statement. There is a choice on an acquisition-by-acquisition basis to measure the
non-controlling interest in the acquiree either at fair value or at the non-controlling interest’s
proportionate share of the acquiree’s net assets. All acquisition-related costs should be expensed.
The adoption of this standard is not expected to have a material impact on the Group’s and the
Company’s financial statements since the application is prospective.

have not been early adopted (continued)
• FRS 5 “Non-current Assets Held for Sale and Discontinued Operations”

- Improvement (effective from 1 January 2010) clarifies that FRS 5 disclosures apply to
non-current assets or disposal groups that are classified as held for sale and discontinued
operations.
- Improvement (effective from 1 July 2010) clarifies that all of a subsidiary’s assets and
liabilities are classified as held for sale if a partial disposal sale plan results in loss of control.
195
Relevant disclosure should be made for this subsidiary if the definition of a discontinued
operation is met.
25 STERLING YEARS
Company’s financial statements.
• Amendments to FRS 7 “Financial Instruments: Disclosure” and FRS 1 “First-time adoption of

financial reporting standards” (effective from 1 January 2011) requires enhanced disclosures of
fair value measurement and liquidity risk. In particular, the amendment requires disclosure of
fair value measurements by level of a fair value measurement hierarchy.
FRS 7 “Financial Instruments: Disclosures” (effective from 1 January 2010) provides information
to users of financial statements about an entity’s exposure to risks and how the entity manages
those risks.
The improvement to FRS 7 clarifies that entities must not present total interest income and
expense as a net amount within finance costs on the face of the income statement. The Group and
the Company have applied the transitional provision in FRS 7, Amendments and Improvement
to FRS 7 which exempts entities from disclosing the possible impact arising from the initial
application of this standard on the financial statements.
• FRS 8 “Operating Segments” replaces FRS 1142004 Segment Reporting (effective from 1 July
2009). The new standard requires a ‘management approach’, under which segment information
is presented on the same basis as that used for internal reporting purposes. The improvement
to FRS 8 (effective from 1 January 2010) clarifies that entities that do not provide information
about segment assets to the chief operating decision-maker will no longer need to report this
information. Prior year comparatives must be restated. The adoption of this standard is not
expected to have a material impact on the Group’s and the Company’s financial statements.

• FRS 101 “Presentation of Financial Statements” (effective from 1 January 2010) prohibits the
presentation of items of income and expenses (that is, ‘non-owner changes in equity’) in the
statement of changes in equity. ‘Non-owner changes in equity’ are to be presented separately
from owner changes in equity. All ‘non-owner changes in equity’ will be required to be shown in a
performance statement, but entities can choose whether to present one performance statement
196 (the statement of comprehensive income) or two statements (the income statement and statement
of comprehensive income).
Where entities restate or reclassify comparative information, they will be required to present
25 STERLING YEARS
a restated balance sheet as at the beginning comparative period in addition to the current
requirement to present balance sheets at the end of the current period and comparative period.
• FRS 107 “Statement of Cash Flows” (effective from 1 January 2010) clarifies that only
expenditure resulting in a recognised asset can be categorised as a cash flow from investing
activities. The adoption of this standard is not expected to have a material impact on the Group’s
and the Company’s financial statements.
• FRS 108 “Accounting Policies, Changes in Accounting Estimates and Errors” (effective from
1 January 2010) clarifies the use of implementation guidance in the standard. The adoption
of this standard is not expected to have a material impact on the Group’s and the Company’s
financial statements.
• FRS 110 “Events after the Balance Sheet date” (effective from 1 January 2010) reinforces
existing guidance that a dividend declared after the reporting date is not a liability of an entity
at that date given that there is no obligation at that time. The adoption of this standard is not
• FRS 117 “Leases” (effective from 1 January 2010) clarifies that the default classification of the
land element in a land and building lease is no longer an operating lease. As a result, leases of
land should be classified as either finance or operating, using the general principles of FRS 117.
• FRS 118 “Revenue” (effective from 1 January 2010) provides more guidance when determining
whether an entity is acting as a ‘principal’ or as an ‘agent’. The adoption of this standard is not

• FRS 119 “Employee Benefits” (effective from 1 January 2010) clarifies that a plan amendment
that results in a change in the extent to which benefit promises are affected by future salary
increases is a curtailment, while an amendment that changes benefits attributable to past service
gives rise to a negative past service cost if it results in a reduction in the present value of the
defined benefit obligation. The definition of return on plan assets has been amended to state
that plan administration costs are deducted in the calculation of return on plan assets only to the
extent that such costs have been excluded from measurement of the defined benefit obligation.
197
25 STERLING YEARS
• FRS 120 “Accounting for Government Grants” (effective from 1 January 2010) clarifies that the
benefit of a below market rate government loan is accounted for in accordance with FRS 120.
• FRS 123 “Borrowing Costs” which replaces FRS 1232004 (effective from 1 January 2010) requires
an entity to capitalise borrowing costs directly attributable to the acquisition, construction or
production of a qualifying asset (one that takes a substantial period of time to get ready for use
or sale) as part of the cost of that asset. The option of immediately expensing those borrowing
costs is removed. The improvement to FRS 123 clarifies that the definition of borrowing costs
includes interest expense calculated using the effective interest method defined in FRS 139.
• FRS 127 “Consolidated and Separate Financial Statements”
- Amendment (effective from 1 January 2010) deals with situations where a parent reorganises
its group by establishing a new entity as its parent. Under the new rules, the new parent
measures the cost of its investment in the original parent at the carrying amount of its share
of the equity items shown in the separate financial statements of the original parent at the
reorganisation date.
- FRS 127 removes the requirement for a parent entity to recognise dividends only to the
extent that it represents distributions from profits of the investee arising after acquisition,
with any excess dividends recognised as a reduction of the loss of investments.
- Amendment (effective from 1 January 2010) clarifies that where an investment in a
subsidiary that is accounted for under FRS 139 is classified as held for sale under FRS 5,
FRS 139 would continue to be applied.
- Amendment (effective prospectively from 1 July 2010) requires the effects of all transactions
with non-controlling interests to be recorded in equity if there is no change in control
and these transactions will no longer result in goodwill or gains and losses. The standard
also specifies the accounting when control is lost. Any remaining interest in the entity is
re-measured to fair value, and a gain or loss is recognised in the income statements.

• FRS 128 “Investments in Associates”

- Amendment (effective from 1 January 2010) clarifies that an investment in an associated
company is treated as a single asset for impairment testing purposes. Reversals of impairment
are recorded as an adjustment to the carrying amount of the investment to the extent that
the recoverable amount of the associated company increases.
198 - Amendment to FRS 128 “Investments in Associates” and FRS 131 “Interests in joint
ventures” (consequential amendments to FRS 132 “Financial instruments: Presentation”
and FRS 7 “Financial instruments: Disclosure”) (effective from 1 January 2010) clarify that
25 STERLING YEARS
where an investment in associate or joint venture is accounted for in accordance with FRS
139, only certain, rather than all disclosure requirements in FRS 128 or FRS 131 need to
be made in addition to disclosures required by FRS 132 and FRS 7.
• FRS 132 “Financial instruments: Presentation”

- Amendment (effective from 1 January 2010) removes the transitional provision that exempted
entities from applying the component part classification for a compound instrument issued
before 1 January 2003. Upon adoption of FRS 139, entities are required to classify the
compound financial instruments into its liability and equity elements.
- Amendment (effective from 1 March 2010) on classification of rights issues addresses

accounting for rights issues that are denominated in a currency other than the functional
currency of the issuer. Provided certain conditions are met, such rights are now classified as
equity instruments instead of as derivative liabilities, regardless of the currency in which the
exercise price is denominated.
The adoption of this standard is not expected to have a material impact on the Group’s and
• FRS 134 “Interim Financial Reporting” (effective from 1 January 2010) clarifies that basic and
diluted earnings per share (‘EPS’) must be presented in an interim report only in the case when
the entity is required to disclose EPS in its annual report. The adoption of this standard is not
expected to have a material impact on the Group’s and Company’s financial statements.
• FRS 136 “Impairment of Assets” (effective from 1 January 2010) clarifies that the largest
cash-generating unit (or group of units) to which goodwill should be allocated for the purposes
of impairment testing is an operating segment before the aggregation of segments with similar
economic characteristics. The improvement also clarifies that where fair value less costs to sell
is calculated on the basis of discounted cash flows, disclosures equivalent to those for value in
use should be made. The adoption of this standard is not expected to have a material impact on
the Group’s financial statements.

• FRS 138 “Intangible Assets”

- Improvement (effective from 1 January 2010) clarifies that a prepayment may only be
recognised in the event that payment has been made in advance of obtaining right of access
to goods or receipt of services. It confirms that the unit of production method of amortisation
is allowed.
- Improvement (effective from 1 July 2010) clarifies that a group of complementary intangible
199
assets acquired in a business combination is recognised as a single asset if the individual
asset has similar useful lives.
25 STERLING YEARS
• FRS 139 “Financial Instruments: Recognition and Measurement” (effective from 1 January
2010). This new standard established principles for recognising and measuring financial assets,
financial liabilities and some contracts to buy and sell non-financial items. Hedge accounting
is permitted only under strict circumstances. The amendments to FRS 139 provide further
guidance on eligible hedged items. The amendment provides guidance for two situations. On the
designation of a one-sided risk in a hedged item, the amendment concludes that a purchased
option designated in its entirety as the hedging instrument of a one-sided risk will not be perfectly
effective. The designation of inflation as a hedged risk or portion is not permitted unless in
particular situations. The improvement to FRS 139 clarifies that the scope exemption in FRS
139 only applies to forward contracts but not options for business combinations that are firmly
committed to being completed within a reasonable timeframe.
The Group and the Company have applied the transitional provision in FRS 139 which exempts
entities from disclosing the possible impact arising from the initial application of this standard
on the financial statements.
• IC Interpretation 4 “Determining whether an Arrangement contains a Lease” (effective from

1 January 2011) requires the Group to idenfity any arrangement that does not take the legal
form of a lease, but conveys a right to use an asset in return for a payment or series of payments.
The interpretion provides guidance for determining whether such arrangements are, or contain,
leases.
The assessment is based on the substance of the arrangement and requires assessment of
whether the fulfillment of the arrangement is dependent on the use of a specific asset and
the arrangement conveys a right to use the asset. If the arrangement contains a lease, the
requirements of FRS 117, “Leases” should be applied to the lease element of the arrangement.
The impact of the adoption of this standard is currently being quantified by management and
cannot be reasonably estimated at this point in time.

• IC Interpretation 9 “Reassessment of Embedded Derivatives” (effective from 1 January 2010)

requires an entity to assess whether an embedded derivative is required to be separated from
the host contract and accounted for as a derivative when the entity first becomes a party to the
contract. Subsequent reassessment is prohibited unless there is a change in the terms of the
contract that significantly modifies the cash flows that otherwise would be required under the
200 contract, in which case reassessment is required.
The improvement to IC Interpretation 9 (effective from 1 July 2010) clarifies that this interpretation
does not apply to embedded derivatives in contracts acquired in a business combination,
25 STERLING YEARS
businesses under common control or the formation of a joint venture.
The Group and the Company have applied the transitional provision in IC Interpretation 9 which
exempts entities from disclosing the possible impact arising from the initial application of this
standard on the financial statements.
• IC Interpretation 10 “Interim Financial Reporting and Impairment” (effective from 1 January

2010) prohibits the impairment losses recognised in an interim period on goodwill and
investments in equity instruments and in financial assets carried at cost to be reversed at a
subsequent balance sheet date. The adoption of this standard is not expected to have a material
impact on the Group’s and the Company’s financial statements.
• IC Interpretation 13, “Customer Loyalty Programmes” (effective from 1 January 2010) explains
how entities that grant loyalty award points to its customers should account for their obligation
to provide free or discounted goods or services if and when the customers redeem the points.
• IC Interpretation 14, FRS 119: “The Limit on a Defined Benefit Asset, Minimum Funding
Requirements and their Interactions” (effective from 1 January 2010) addresses how entities
should determine the limit placed on the amount of a surplus in a pension plan they can recognise
as an asset. Also, it addresses how a minimum funding requirement affects that limit and when
a minimum funding requirement creates an onerous obligation that should be recognised as a
liability in addition to that otherwise recognised under FRS 119. The adoption of this standard is
not expected to have a material impact on the Group’s and the Company’s financial statements.

(c) Standards, amendments to published standards and interpretations that are not yet effective and not
relevant to the Group’s operations
• The amendment to FRS 1 “First-time adoption of Financial Reporting Standards” and FRS 127
“Consolidated and Separate Financial Statements: Cost of an Investment in a Subsidiary, Jointly
controlled entity or Associate” (effective from 1 January 2010)
• The amendment to FRS 1: “Additional Exemptions for the First time Adopters” (effective from
1 January 2011)
• FRS 2 “Share Based Payment” (Amendment) (effective from 1 January 2010) and the
201
improvement to FRS 2 (effective from 1 July 2010)
25 STERLING YEARS
• The amendment to FRS 2: “Group Cash-settled Share Based Payment Transactions“ (effective
from 1 January 2011)
• FRS 4 “Insurance Contracts” (effective from 1 January 2010)
• FRS 116 “Property, Plant and Equipment” (consequential amendment to FRS 107 “Statement
of Cash Flows”) and a consequential amendment to FRS 107 (effective from 1 January 2010)
• FRS 129 “Financial Reporting in Hyperinflationary Economies” (effective from 1 January
2010)
• FRS 132 “Financial Instruments: Presentation” (effective from 1 March 2010) and
FRS 101 (revised) “Presentation of Financial Statements” - “Puttable Financial Instruments and
Obligations Arising on Liquidation” (effective from 1 January 2010)
• FRS 140 “Investment Property” (effective from 1 January 2010)
• IC Interpretation 11, FRS 2: “Group and Treasury Share Transactions” (effective from 1 January
2010)
• IC Interpretation 12 “Service Concession Arrangements” (effective from 1 July 2010)
• IC Interpretation 15 “Agreements for Construction of Real Estates” (effective from
1 July 2010)
• IC Interpretation 16 “Hedges of a Net Investment in a Foreign Operation” (effective from
1 July 2010)
• IC Interpretation 17 “Distribution of Non-cash Assets to Owners” (effective from 1 July 2010)
• IC Interpretation 18 “Transfers of Assets from Customers” (effective from 1 January 2011)
3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The following accounting policies have been used consistently in dealing with items which are considered
material in relation to the financial statements.
(a) Economic entities in the Group
(i) Subsidiary companies
Subsidiary companies are those corporations, partnerships or other entities in which the Group
has the power to exercise control over the financial and operating policies so as to obtain benefits
202 from their activities, generally accompanying a shareholding of more than one half of the voting
rights. The existence and effect of potential voting rights that are currently exercisable or
convertible are considered when assessing whether the Group controls another entity.
25 STERLING YEARS
Investments in subsidiary companies are stated at cost less accumulated impairment losses. Where
an indication of impairment exists, the carrying amount of the investment is assessed and written
down immediately to its recoverable amount. The accounting policy on Impairment of Assets is
set out in Note 3(u).
Prior to 1 January 2006, the Group applied both the purchase method and the merger method
to account for Business Combinations in accordance with prior financial reporting standards.
With effect from 1 January 2006, only the purchase method of accounting is used to account for
Business Combinations in accordance with FRS 3.
The cost of an acquisition is measured as the fair value of the assets given, equity instruments
issued and liabilities incurred or assumed at the date of exchange, plus costs directly attributable
to the acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed
in a business combination are measured initially at their fair values at the acquisition date
irrespective of the interest of any minority interest. The excess of the cost of acquisition over the
fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill. The
accounting policy on goodwill is set out in Note 3(d)(i). If the cost of acquisition is less than the
fair value of the net assets of the subsidiary company acquired, the difference is recognised as a
gain in the Consolidated Income Statements.
Subsidiary companies are consolidated from the date on which control is transferred to the
Group. They are de-consolidated from the date that control ceases.
Uniform accounting policies for like transactions and other events in similar circumstances are
used by all companies in the Group in preparing the Consolidated Financial Statements. The
financial statements of all companies within the Group used in the preparation of the Consolidated
Financial Statements are prepared as of the same reporting date.
Inter-company balances, inter-company transactions and unrealised gains on transactions

between Group companies are eliminated in full. Unrealised losses are also eliminated in full
unless the assets transferred are impaired.

3 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
(a) Economic entities in the Group (continued)
(i) Subsidiary companies (continued)
Minority interests represent that portion of the profit or loss and net assets of a subsidiary
company attributable to equity interests that are not owned, directly or indirectly through the
subsidiary companies by the parent. It is measured at the minorities’ share of the fair values
of the subsidiary companies’ identifiable assets and liabilities at the acquisition date and the
minorities’ share of changes in the subsidiary companies’ equity since that date. 203
The gain or loss on disposal of a subsidiary company is the difference between the net disposal
proceeds and the Group’s share of the subsidiary company’s net assets as of the date of disposal,
25 STERLING YEARS
including the cumulative amount of any exchange differences that relate to that subsidiary
company which were previously recognised in equity, and is recognised in the Consolidated
Income Statements.
(ii) Transactions with minority interests
Disposal of equity shares to minority interests for cash consideration and at fair value resulting in
gain or loss for the Group is recorded in the Consolidated Income Statements. The gain or loss is
the difference between the Group’s share of net assets immediately before and after the disposal
and a portion of goodwill is realised.
For purchase of equity shares from minority interests for cash consideration and at fair value,
the accretion of the Group’s interest in the subsidiary company is treated as purchase of equity
interest under acquisition method of accounting. The identifiable assets and liabilities acquired
are adjusted to their fair values and the difference is recognised as goodwill.
For purchases or disposals from or to minority interest other than for cash and not at fair value,
the accretion or dilution of the Group’s interests is treated as equity transactions between the
subsidiary company and its shareholders. The gain or loss is recorded in the Group’s reserves.
The gain or loss is the difference between the Group’s share of net assets immediately before and
after the disposal and the purchase consideration received or paid.
(iii) Associated companies
Associated companies are those corporations, partnerships or other entities in which the Group
exercises significant influence, but which it does not control. Significant influence is the power
to participate in the financial and operating policy decisions of the associated companies but not
the power to exercise control over those policies.

(iii) Associated companies (continued)
Investments in associated companies are stated at cost. Where an indication of impairment

exists, the carrying amount of the investment is assessed and written down immediately to its
recoverable amount. The accounting policy on Impairment of Assets is set out in Note 3(u).
In the Consolidated Financial Statements, investments in associated companies are accounted

204 for using the equity method. Under the equity method, the Group’s share of its associated
companies’ post-acquisition results is recognised in the Consolidated Income Statements, and
its share of post-acquisition movements in reserves is recognised in reserves. The cumulative
25 STERLING YEARS
post-acquisition movements are adjusted to the carrying amount of the investment. When the
Group’s share of losses in an associated company equals or exceeds its cost of investment in the
associated company including any other unsecured receivables, the Group discontinues its share
of further losses, unless it has incurred legal or constructive obligations to make payments on
behalf of the associated company.
Unrealised gains on transactions between the Group and its associated companies are eliminated
to the extent of the Group’s interest in the associated companies. Unrealised losses are also
eliminated unless the assets transferred are impaired.
In applying the equity method, the Group has ensured that uniform accounting policies for like
transactions and other events in similar circumstances of the associated companies are used.
The equity method is applied based on the latest financial statements made up to the financial
year end of the Group.
(iv) Jointly controlled entities
Jointly controlled entities are corporations, partnerships or other entities over which there is
contractually agreed sharing of control by the Group with one or more parties where the strategic
financial and operating policy decisions relating to the entity requires unanimous consent of the
parties sharing control. The Group’s interests in jointly controlled entities are accounted for in
the Consolidated Financial Statements by the equity method of accounting, as disclosed in Note
3(a)(iii).
Investments in jointly controlled entities are stated at cost. Where an indication of impairment
exists, the carrying amount of the investment is assessed and written down immediately to its
recoverable amount. The accounting policy on Impairment of Assets is set out in Note 3(u).
The Consolidated Income Statements include the Group’s share of results of the jointly controlled
entities based on the financial statements made up to the financial year end of the Group. The
cumulative post-acquisition movements are adjusted to the carrying amount of the investment.

(iv) Jointly controlled entities (continued)
Unrealised gains on transactions between the Group and its jointly controlled entities are
eliminated to the extent of the Group’s interest in the jointly controlled entities. Unrealised losses
are also eliminated unless the assets transferred are impaired.
In applying the equity method, the Group has ensured that uniform accounting policies of jointly
controlled entities for like transactions and other events in similar circumstances are used. The 205
equity method is applied based on the latest financial statements made up to the financial year
end of the Group.
25 STERLING YEARS
(b) Investments
The Group uses its judgement to determine the classification of its investments into current and
non-current. An investment is classified as current if it is readily realisable and it is held for trading
or intended to be realised within 12 months after the balance sheet date. All other investments are
classified as non-current.
Non-current investments are shown at cost and an allowance for diminution in value is made where, in
the opinion of the Directors, there is a decline other than temporary in the value of such investments.
Where there has been a decline other than temporary in the value of an investment, such a decline is
recognised as an expense in the period in which the decline is identified.
Quoted and unquoted current investments are carried at the lower of cost and market value, determined
on an aggregate portfolio basis by category of investments. Cost is derived at on the weighted average
basis whilst market value is calculated by reference to stock exchange quoted selling prices at the
close of business on the balance sheet date. Increases/decreases in the carrying amount of current
investments are credited/charged to the Consolidated Income Statements.
On disposal of an investment, the difference between net disposal proceeds and its carrying amount
is credited/charged to the Consolidated Income Statements.
(c) Property, plant and equipment
Property, plant and equipment are tangible items that:
I. are held for use in the production or supply of goods or services, or for administrative purposes;
and
II. are expected to be used during more than one period.


(c) Property, plant and equipment (continued)
(i) Cost
Property, plant and equipment are initially stated at cost. Cost includes expenditure that is directly
attributable to the acquisition of the items and bringing them to the location and condition so as
to render them operational in the manner intended by the Group. The Group allocates the initial
cost of an item of property, plant and equipment to its significant component parts.
206 A piece of freehold land held by the Group is stated at the Directors’ valuation based on a 1983
independent professional valuation of the open market value of the land on an existing use basis.
The surplus arising on revaluation was credited directly to capital reserves and subsequently
25 STERLING YEARS
utilised.
The Group has adopted the transitional provision of FRS 116 which allows the freehold land
to be stated at the amount revalued on 5 September 1983. All other land held by the Group is
stated at cost.
Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset,
as appropriate, only when it is probable that future economic benefits associated with the item
will flow to the Group and the cost of the item can be measured reliably. The carrying amount
of the replaced part is derecognised. All other repairs and maintenance are charged to the
Consolidated Income Statements during the financial period in which they are incurred.
(ii) Depreciation
Freehold land is not depreciated as it has an infinite life. Depreciation of other property, plant
and equipment is provided for on a straight line basis to write off the cost or valuation of each
asset to its residual value over its estimated useful life. The assets’ residual values, useful lives
and depreciation method are reviewed annually and revised if appropriate.
The principal estimated useful lives of depreciation used are as follows:
Buildings 15-50 years

Plant and machinery 5-20 years
Office equipment, furniture, fittings and vehicles 2-10 years
During the financial year, the depreciation method of dies and jigs, which are included under
plant and machinery has been revised to the straight line basis from unit of production basis. The
revision in the basis of depreciation is to better reflect the respective assets product life cycle.
As a result, an additional depreciation charge of RM15.8 million has been recognised in the
Consolidated Income Statements during the year.

(c) Property, plant and equipment (continued)
(ii) Depreciation (continued)
Work-in-progress is not depreciated. Upon completion, the related costs will be transferred to the
respective categories of assets. Depreciation on work-in-progress commences when the assets
are ready for their intended use.
(iii) Impairment
207
Where an indication of impairment exists, the carrying amount of the assets is assessed and
written down immediately to its recoverable amount if the carrying amount exceeds the recoverable
25 STERLING YEARS
amount. The accounting policy on Impairment of Assets is set out in Note 3(u).
(iv) Gains or losses on disposals
Gains or losses on disposals are determined by comparing proceeds with their related carrying
amounts and are included in profit/(loss) from operations.
(v) Repairs and maintenance
Repairs and maintenance are charged to the Consolidated Income Statements during the period
in which they are incurred. The cost of major renovations are included in the carrying amount of
the asset when it is probable that future economic benefits in excess of the originally assessed
standard of performance of the existing asset will flow to the Group. Major renovations are
depreciated over the remaining useful life of the related assets.
(d) Intangible assets
(i) Goodwill
Goodwill is carried at cost less accumulated impairment losses. Goodwill is tested for impairment
at least annually, or when events or circumstances occur indicating that an impairment may
exist. Impairment of goodwill is charged to the Consolidated Income Statements as and when
it arises. Impairment losses on goodwill are not reversed. Gains or losses on the disposal of an
entity includes the carrying amount of goodwill relating to the entity disposed.
Goodwill is allocated to cash-generating units for the purpose of impairment testing. Each cash-
generating unit or a group of cash-generating units represents the lowest level within the Group at
which goodwill is monitored for internal management purposes and which are expected to benefit
from the synergies of the combination. The Group allocates goodwill to each business segment
in each country in which it operates.

(d) Intangible assets (continued)
(i) Goodwill (continued)
Goodwill on acquisition of associated companies and jointly controlled entities are included
in the carrying value of the investment in associated companies and jointly controlled entities
respectively. Such goodwill is tested for impairment as part of the overall balance.
(ii) Computer software

208
Acquired computer software licenses are capitalised on the basis of the costs incurred to acquire
and bring to use the specific computer software. These costs are amortised over their estimated
25 STERLING YEARS
useful lives of 3 to 5 years.
Costs associated with developing or maintaining computer software programmes are recognised
as an expense when incurred. Costs that are directly associated with identifiable and unique
software products controlled by the Group, and that will probably generate economic benefits
exceeding costs beyond one year, are recognised as intangible assets. Costs include employee
costs incurred as a result of developing software and an appropriate portion of relevant overheads.
Computer software development costs recognised as assets are amortised using the straight line
method over their estimated useful lives, not exceeding a period of 3 years.
(iii) Research and development cost
Expenditure in connection with research activities (research expenditure) is recognised as an

expense when incurred. Costs incurred on development projects (relating to the design and
testing of new or improved products) are recognised as intangible assets when the following
criteria for recognition are fulfilled:
(i) It is technically feasible to complete the intangible asset so that it will be available for use
or sale;
(ii) Management’s intention to complete the intangible asset for use or sale;
(iii) There is an ability to use or sell the intangible asset;
(iv) It can be demonstrated that the intangible asset will generate probable future economic
benefits;
(v) Adequate technical, financial and other resources to complete the development and to use
or sell the intangible asset are available; and
(vi) The expenditure attributable to the intangible asset during its development can be reliably
measured.

(d) Intangible assets (continued)
(iii) Research and development cost (continued)
Development costs previously recognised as an expense are not recognised as an asset in a
subsequent period. Development expenses capitalised include costs incurred in the development
from the date it first meets the recognition criteria and up to the completion of the development
project and commencement of commercial production. Capitalised development cost is stated
at cost less accumulated amortisation and accumulated impairment losses, if any. Similar to the
depreciation of dies and jigs in Note 3(c)(ii), the amortisation method has been revised. During 209
the financial year the amortisation of research and development cost has been revised to the
straight line basis over its useful life, which does not exceed 7 years for vehicles and 10 years
25 STERLING YEARS
for mechanical parts. Previously, amortisation was based on the unit of production basis, arising
from the change an additional amortisation charge of RM11.1 million has been recognised in the
Consolidated Income Statements during the year. The revision in the amortisation method was
applied to better reflect the respective assets product life cycle.
(e) Leases
Leases of property, plant and equipment and intangible assets where the Group assumes substantially
all the benefits and risks or ownership are classified as finance leases.
Finance leases are capitalised at the inception of the lease at the lower of the fair value of the leased
property, plant and equipment and intangible assets, and the present value of the minimum lease
payments. Each lease payment is allocated between the liability and finance charges so as to achieve
a periodic constant rate of interest on the balance outstanding. The corresponding obligations, net of
finance charges, are included in borrowings. The interest element of the finance charge is charged to
the Consolidated Income Statements over the lease period.
Property, plant and equipment and intangible assets acquired under finance leases are included in
tangible property, plant and equipment and intangible assets and are depreciated in accordance with
Note 3(c)(ii) and Note 3(d)(ii) above respectively.
(f) Prepaid land lease payment
Leasehold land that normally has a finite economic life and title is not expected to pass to the lessee
by the end of the lease term is treated as an operating lease. The payment made on entering into or
acquiring a leasehold land is accounted as prepaid land lease payment that is amortised over the
lease term in accordance with the pattern of benefits provided.

(g) Inventories
Inventories are stated at the lower of cost and net realisable value. Cost includes the actual cost of
materials and incidentals in bringing the inventories to their present location and condition, and is
determined either on the first-in first-out basis and weighted average basis depending on the nature of
inventory. Cost of vehicles for sales are determined on a specific identification basis. Cost of parts and
accessories is determined on a weighted average basis. Net realisable value represents the estimated
selling price less all estimated costs to completion and costs to be incurred in marketing, selling and
210 distribution. In arriving at net realisable value, due allowance is made for obsolete, slow moving or
defective inventories.
In the case of work-in-progress and finished vehicles, an appropriate proportion of production overheads is
25 STERLING YEARS
included in the costs based on normal operating capacity and is determined on a weighted average basis.
(h) Trade and other receivables
Trade and other receivables are carried at anticipated net realisable value. Allowances are made for
doubtful debts based on specific reviews of outstanding balances at the balance sheet date. General
allowances are made to cover possible losses, which are not specifically identified. Bad debts are
written off to the Consolidated Income Statements during the financial period in which they are
identified.
(i) Non-current assets classified as assets held for sale
Non-current assets are classified as assets held for sale when the carrying amount is to be recovered
principally through a sale transaction. They are stated at the lower of carrying amount and fair value less
costs to sell if the carrying amount is to be recovered principally through a sale transaction rather than
through continuing use.
(j) Government grants
Government grants are recognised in the Consolidated Income Statements on a systematic basis over the
periods in which the Group recognises as expenses the related cost for which the grants are intended to
compensate.
Grants from government are recognised at their fair values where there are reasonable assurances that the
grants will be received and the Group will comply with all attached conditions.
Capital grants
Government grants relating to capital expenditure are deferred and recognised in the Consolidated Income
Statements over the period necessary to match them with the costs they are intended to compensate.
Government grants relating to the purchase of plant and equipment are included in non-current liabilities
as deferred income and are credited to the Consolidated Income Statements on a straight line basis over
the expected lives of the related assets.
Income grants
Income grants are grants other than capital grants and recognised in the Consolidated Income Statements
where there is a reasonable assurance that the grant will be received and the Group will comply with all
attached conditions.

(k) Provisions
Provisions are recognised when the Group has a present legal or constructive obligation as a result of
past events, when it is probable that an outflow of resources will be required to settle the obligation,
and when a reliable estimate of the amount can be made. Where the Group expects a provision to be
reimbursed, the reimbursement is recognised as a separate asset but only when the reimbursement is
virtually certain. Provisions are reviewed at each balance sheet date and adjusted to reflect the current
best estimate. When the effect of the time value of money is material, the amount of provision is the
present value of the expenditure expected to be required to settle the obligation. Provisions are not 211
recognised for future operating losses.
(i) Warranties
25 STERLING YEARS
Provision is recognised for the estimated liability on all products under warranty in addition to
claims already received and verified. Warranties are provided for a period of between one to three
years for vehicles sold. The provision is based on experienced levels of claims arising during the
period of warranty. When the Group expects warranties to be reimbursed from suppliers, the
reimbursement is recognised as a separate asset but only when the reimbursement is virtually
certain.
(ii) Onerous contracts
The Group recognises a provision for onerous contracts when the expected benefits to be derived
from a contract are less than the unavoidable costs of meeting the obligations under the contract
or estimated costs of exiting the contract.
(iii) Free services
Provisions for free services are recognised based on expected levels of claims arising during the
period when the free services are provided.
(l) Employee benefits
(i) Short term employee benefits
Salaries, wages, paid annual leave and sick leave, bonuses and non-monetary benefits are accrued
in the period in which the associated services are rendered by employees of the Group.
(ii) Post employment benefits
The Group has various post employment benefit schemes in accordance with the local conditions
and practices in the countries in which it operates. The Group has both defined contribution and
defined benefit plans.
Defined contribution plans
The Group’s contributions to defined contribution plans are charged to the Consolidated Income
Statements in the period to which they relate. Once the contributions have been paid, the Group
has no further payment obligations.

(l) Employee benefits (continued)
(ii) Post employment benefits (continued)
Defined benefit plan
The liability in respect of a defined benefit plan is the present value of the defined benefit
obligation at the balance sheet date minus the fair value of plan assets, together with adjustments
for actuarial gains/losses and past service cost. The Group determines the present value of the
212 defined benefit obligation and the fair value of any plan assets with sufficient regularity such that
the amounts recognised in the financial statements do not differ materially from the amounts
that would be determined at the balance sheet date.
25 STERLING YEARS
The defined benefit obligation, calculated using the projected unit credit method, is determined
by independent actuaries on the basis of full triennial valuations and updated annually.
Assumptions were made in relation to the annual investment returns, annual salary increases
and annual increases in pension payments.
Plan assets in excess of the defined benefit obligation are subject to the asset limitation test
specified in FRS 119.
Actuarial gains and losses arise from experience adjustments and changes in actuarial assumptions.
The amount of net actuarial gains and losses recognised in the Consolidated Income Statements
is determined by the corridor method in accordance with FRS 119 and is charged or credited
to the Consolidated Income Statements over the average remaining service lives of the related
employees participating in the defined benefit plan.
(iii) Termination benefits
Termination benefits are payable whenever an employee’s employment is terminated before the
normal retirement date or whenever an employee accepts voluntary redundancy in exchange for
these benefits. The Group recognises termination benefits when it is demonstrably committed
to either terminate the employment of current employees according to a detailed formal plan
without possibility of withdrawal or to provide termination benefits as a result of an offer made to
encourage voluntary redundancy. Benefits falling due more than 12 months after balance sheet
date are discounted to present value.

(m) Income taxes
Current tax expense is determined according to the tax laws of each jurisdiction in which the Group
operates and include all taxes based upon the taxable profits, including withholding taxes payable by
a foreign subsidiary company on distributions of retained earnings.
Deferred tax is recognised in full, using the liability method, on temporary differences arising between
the amounts attributed to assets and liabilities for tax purposes and their carrying amounts in the
financial statements. 213
Deferred tax assets are recognised to the extent that it is probable that taxable profit will be available
against which the deductible temporary differences or unused tax losses can be utilised.
25 STERLING YEARS
Deferred tax is recognised on temporary differences arising on investments in subsidiary companies,
associated companies and jointly controlled entities except where the timing of the reversal of the
temporary difference can be controlled and it is probable that the temporary difference will not
reverse in the foreseeable future.
Deferred tax assets and liabilities are not recognised on temporary differences arising from:
(i) goodwill; or
(ii) from the initial recognition of an asset or liability in a transaction which is not a business
combination and at time of the transaction, affects neither accounting profit nor taxable profit.
Deferred tax is determined using tax rates (and tax laws) that have been enacted or substantially
enacted by the balance sheet date and are expected to apply when the related deferred tax asset is
realised or the deferred tax liability is settled.
(n) Foreign currency transactions and translation
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using
its functional currency, which is the currency of the primary economic environment in which the
entity operates (‘the functional currency’). The Consolidated Financial Statements are presented
in Ringgit Malaysia, which is the Group’s functional and presentation currency.
(ii) Transactions and balances
Foreign currency transactions are translated into the functional currency using the exchange rates
prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the
settlement of such transactions and from the translation at year-end exchange rates of monetary
assets and liabilities denominated in foreign currencies are recognised in the Consolidated
Income Statements.

(n) Foreign currency transactions and translation (continued)
(iii) Group companies
The results and financial position of all the Group companies (none of which has the currency
of a hyperinflationary economy) that have a functional currency different from the presentation
currency are translated into the presentation currency as follows:
- assets and liabilities for each balance sheet presented are translated at the closing rate at
214 the date of that balance sheet;
- income and expenses for each income statement are translated at average exchange rates
25 STERLING YEARS
(unless this average is not a reasonable approximation of the cumulative effect of the rates
prevailing on the transaction dates, in which case income and expenses are translated at the
dates of the transactions); and
- all resulting exchange differences are recognised as a separate component of equity.
On consolidation, exchange differences arising from the translation of the net investment in
foreign operations are taken to shareholders’ equity. Net investment in foreign operations is
defined as the amount of the reporting entity’s interest in the net assets of that operation,
which includes advances that are assessed as long term in nature. When a foreign operation is
disposed of or sold, such exchange differences that were recorded in equity are recognised in the
Consolidated Income Statements as part of the gain or loss on disposal.
(iv) Closing rates
The principal closing rates (units of Malaysian Ringgit per foreign currency) used in translating
significant balances at financial year end are as follows:
Foreign currency 31 March 2010 31 March 2009
US Dollar 3.2725 3.6595

Sterling Pound 4.9415 5.2225
Indonesian Rupiah (100) 0.0358 0.0313
Singapore Dollar 2.3388 2.4048
Thai Baht 0.1012 0.1029
Australian Dollar 3.0120 2.4935
Euro 4.3940 4.8270
(o) Cash and cash equivalents
For the purpose of the cash flow statement, cash and cash equivalents comprise cash and bank
balances, deposits held at call with banks, other short term, highly liquid investments with original
maturities of not more than twelve months, bank overdrafts and pledged deposits. Bank overdrafts are
included within borrowings in current liabilities on the Balance Sheet.

(p) Income recognition
Revenue from sales of vehicles, spare parts and accessories are recognised when significant risks and
rewards have been transferred to buyers. Significant risks and benefits are generally deemed to have
been transferred upon delivery or acceptance of the goods.
Revenue from rendering of engineering services on long term engineering contracts is recognised on
the basis of the stage of completion of such contracts at the financial year end, where the contractual
outcome can be assessed with reasonable certainty. Full provision is made for all foreseeable losses
on contracts entered into or commenced prior to the financial year end. Amounts are included within
215
receivables and payables to recognise timing differences arising between amounts invoiced and
amounts recognised in the Consolidated Income Statements on individual engineering contracts.
25 STERLING YEARS
Revenue from sale of completed apartments is recognised when the Sale and Purchase Agreements
are signed, significant risks and rewards of ownership have been transferred to the buyer and the
recovery of the consideration is probable.
Other revenue comprises mainly revenue from rental and royalties, which are recognised on an accrual
basis. Interest income is recognised on proportionate basis that reflects the effective yield on the
asset. Scrap sales and gains on disposal of investments are recognised on an accrual basis.
Sale of rights for the use of intellectual property rights are recognised on an accrual basis in accordance
with the substance of the relevant agreements.
Dividends are recognised when the Company’s right to receive payment is established.
(q) Financial instruments
(i) Description
A financial instrument is any contract that gives rise to both a financial asset of one enterprise and
a financial liability or equity instrument of another enterprise.
A financial asset is any asset that is cash, a contractual right to receive cash or another financial
asset from another enterprise, a contractual right to exchange financial instruments with another
enterprise under conditions that are potentially favourable, or an equity instrument of another
enterprise.
A financial liability is any liability that is a contractual obligation to deliver cash or another
financial asset to another enterprise, or to exchange financial instruments with another enterprise
under conditions that are potentially unfavourable.
(ii) Financial instruments not recognised on the balance sheet
The Group enters into foreign currency forward contracts to protect the Group from movements
in exchange rates by establishing the rate at which a foreign currency asset or liability will be
settled.
Exchange gains and losses arising on contracts entered into as hedges of anticipated future
transactions are deferred until the settlement of the related forward contracts.

(q) Financial instruments (continued)
(iii) Fair value estimation for disclosure purposes
The fair value of publicly traded derivatives and securities is based on quoted market prices at
the balance sheet date.
The fair value of forward foreign exchange contracts is determined using forward foreign exchange
market rates at the balance sheet date.
216
In assessing the fair value of non-traded derivatives and financial instruments, the Group uses a
variety of methods and makes assumptions that are based on market conditions existing at each
25 STERLING YEARS
balance sheet date. Unquoted investments are valued based on quoted investments with similar
features.
The fair value of financial liabilities with a maturity of more than one year is estimated by
discounting the future contractual cash flows at the current market interest rate available to the
Group for similar financial instruments.
The face values, less any estimated credit adjustments, for financial assets and liabilities
classified as current are assumed to approximate their fair values.
(r) Borrowings
Borrowings are initially recognised based on the proceeds received, net of transaction costs incurred.
Subsequently, borrowings are stated at amortised cost using the effective yield method; any difference
between proceeds (net of transaction costs) and the redemption value is recognised in the Consolidated
Income Statements over the period of the borrowings.
Borrowing costs are charged to the Consolidated Income Statements as an expense in the period in
which they have accrued.
Borrowings are classified as current liabilities unless the Group has the unconditional right to defer
settlement of the liability for at least 12 months after the balance sheet date.
(s) Share capital
Ordinary shares are classified as equity. External costs directly attributable to the issue of new shares
are expensed off in the Consolidated Income Statements.
Dividends on ordinary shares are recognised as liabilities when proposed or declared before the
balance sheet date. A dividend proposed or declared after the balance sheet date, but before the
financial statements are authorised for issue, is not recognised as a liability at the balance sheet date.
Upon the dividend becoming payable, it will be accounted for as liability.

(t) Contingent liabilities and contingent assets
The Group and Company do not recognise a contingent liability but disclose its existence in the
financial statements. A contingent liability is a possible obligation that arises from past events whose
existence will be confirmed by uncertain future events beyond the control of the Group or a present
obligation that is not recognised because it is not probable that an outflow of resources will be
required to settle the obligation. A contingent liability also arises in the extremely rare circumstance
where there is a liability that cannot be recognised because it cannot be measured reliably.
A contingent asset is a possible asset that arises from past events whose existence will be confirmed
217
by uncertain future events beyond the control of the Group. The Group does not recognise contingent
assets but discloses its existence where inflows of economic benefits are probable, but not virtually
25 STERLING YEARS
certain.
In the acquisition of subsidiary companies by the Group under a business combination, the contingent
liabilities assumed are measured initially at their fair values at the acquisition date, irrespective of the
extent of any minority interests.
The Group recognises separately the contingent liabilities of the acquirees as part of allocating the
cost of a business combination where their fair values can be measured reliably. Where the fair values
cannot be measured reliably, the resulting effect will be reflected in the goodwill arising from the
acquisition.
Subsequent to the initial recognition, the Group measures the contingent liabilities that are recognised
separately at the date of acquisition at the higher of the amount that would be recognised in accordance
with the provisions of FRS 137 and the amount initially recognised less, when appropriate, cumulative
amortisation recognised in accordance with FRS 118.
(u) Impairment of assets
Assets that have an indefinite useful life are not subject to amortisation and are tested annually for
impairment, or whenever events or circumstances occur indicating that an impairment may exist.
Property, plant and equipment and other non-current assets, including intangible assets, are reviewed
for impairment losses whenever events or changes in circumstances indicate that the carrying amount
may not be recoverable. Impairment loss is recognised for the amount by which the carrying amount
of the asset exceeds its recoverable amount. The recoverable amount is measured at the higher of the
fair value less cost to sell of an asset and its value-in-use. The value-in-use is the net present value of
the projected future cash flows derived from that asset discounted at the appropriate discount rate.
Assets other than goodwill that suffered an impairment are reviewed for possible reversal at each
reporting date.
The projected cash flows are based on the Group’s estimates calculated based on historical, industry
trend, general market, economic conditions and other available information. For the purposes of
assessing impairment, assets are grouped at the lowest level for which there is separately identifiable
cash flows.

(u) Impairment of assets (continued)
The impairment loss is charged to the Consolidated Income Statements. Any subsequent increase in
recoverable amount is recognised in the Consolidated Income Statements.
Irrespective of whether there is any indication of impairment, the Group shall test an intangible
asset with an indefinite useful life or an intangible asset not yet available for use for impairment
annually by comparing its carrying amount with its recoverable amount. This impairment test may be
218 performed at any time during an annual period; it is performed at the same time every year. Different
intangible assets may be tested for impairment at different times. However, if such an intangible
asset was initially recognised during the current annual period, that intangible asset shall be tested
for impairment before the end of the current annual period.
25 STERLING YEARS
4 KEY ESTIMATES AND JUDGEMENTS

Estimates and judgements are continually evaluated and are based on historical experience and other factors,
including expectations of future events that are believed to be reasonable under the circumstances.
The Group makes estimates and assumptions concerning the future. The resulting accounting estimates
will, by definition, rarely equal the related actual results. To enhance the information content of the
estimates, certain key variables that are anticipated to have a material impact on the Group’s results and
financial position are tested for sensitivity to changes in the underlying parameters. The estimates and
assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets
and liabilities within the next financial year are mentioned below.
(i) Carrying value of property, plant and equipment and capitalised development cost
The Group assesses the carrying amount of property, plant and equipment and capitalised development
cost whenever the events or changes in circumstances indicate that the carrying amount of an asset
may not be recoverable i.e. the carrying amount of the asset is more than the recoverable amount.
Recoverable amount is measured at the higher of the fair value less cost to sell for that asset and its
value-in-use. The value-in-use is the net present value of the projected future cash flows derived from
the asset discounted at an appropriate discount rate.
Projected future cash flows are based on the Group’s estimates calculated based on the cash generating
unit’s operating results, approved business plans, expected market growth and industry growth as well
as future economic conditions and other data. The assumptions used, results and conclusion of the
impairment assessment are stated in Note 13 to the financial statements.

4 KEY ESTIMATES AND JUDGEMENTS (continued)
(ii) Estimated useful lives of dies and jigs and capitalised development cost
The Group reviews annually the estimated useful lives of dies and jigs and capitalised development
cost based on product life cycle. The product life cycle is assessed based on business plans and
strategies such as, the expected product life cycle as well as technological developments.
Future results of operations could be materially affected by changes in these estimates brought about
by changes in the factors mentioned. A reduction in the estimated useful lives used for assessing
the carrying values of dies and jigs and capitalised development cost would increase the recorded
depreciation and amortisation respectively.
219
(iii) Deferred tax assets
25 STERLING YEARS
Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be
available against which the temporary differences can be utilised. This involves significant judgements
regarding the future financial performance of the Group, the likely timing and level of future taxable
profits together with future tax planning strategies to support the basis of recognition of deferred tax
assets. An analysis of the deferred tax balance is set out in Note 22 to the financial statements.
The Directors have considered the ability of the Group to generate sufficient taxable income to utilise
the deferred tax assets and have concluded that no deferred tax asset should be recognised for certain
subsidiary companies as at 31 March 2010 (Note 22).
(iv) Estimation of income taxes payable and recoverable
Income taxes are estimated based on the rules governed under the Income Tax Acts of the respective
countries. Significant judgement is required in determining the capital allowances and deductibility of
certain expenses during the estimation of the provision for income taxes. There are many transactions
and calculations for which the ultimate tax determination is uncertain during the ordinary course of
business.
Where the final tax outcome of these matters is different from the amounts that were initially recognised,
such differences will impact the income tax provisions in the period in which such determination
is made. The status of the income tax position of the Group is stated in Note 10 to the financial
statements.
4 KEY ESTIMATES AND JUDGEMENTS (continued)

(v) Provisions for warranty
Provision is made for the estimated liability on all products under warranty in addition to claims
already received. The accrual recorded is based on the actual claims experienced by the Group arising
during the period of warranty over a number of years which provides a basis for calculating expected
warranty claims. In addition, the Group records an asset for the amount expected to be recoverable
from its vendors based on similar actual reimbursement experienced by the Group.
220 An analysis of the utilisation of the provision is stated in Note 34 to the financial statements.
(vi) Allowance for inventory write down

25 STERLING YEARS
Allowance for inventory write down is made based on an analysis of the ageing profile and expected
sales patterns of individual items held in inventory. This requires an analysis of inventory usage based
on expected future sales transactions taking into account current market prices, useful lives of vehicle
models and expected cost to sell. Changes in the inventory ageing and expected usage profiles can
have an impact on the allowance recorded.
(vii) Allowance for receivables
The allowance is established when there is objective evidence that the Group will not be able to
collect all amounts due according to the original terms of receivables. This is determined based on the
ageing profile, expected collection patterns of individual receivable balances, credit quality and credit
losses incurred. Management carefully monitors the credit quality of receivable balances and makes
estimates about the amount of credit losses that have been incurred at each financial statements
reporting date. Any changes to the ageing profile, collection patterns, credit quality and credit losses
can have an impact on the allowance recorded.
(viii) Impairment of goodwill
The Group tests goodwill for impairment at least annually in accordance with its accounting policy
or whenever events or changes in circumstances indicate that this is necessary. The assumptions
used, results and conclusion of the impairment assessment are stated in Note 15 to the financial
statements.

5 SIGNIFICANT EVENTS DURING THE FINANCIAL YEAR
During the financial year and as reported in the prior financial year,
(a) The Members’ Voluntary Liquidation of Proton Cars Benelux Limited (‘Benelux’), a 99% owned
subsidiary company of Proton Marketing Sdn. Bhd. (‘PMSB’) on 2 February 2009 has not been
completed. Benelux had not commenced operations since its incorporation.
(b) Proton Edar Ventures Sdn. Bhd. and Proton Edar Resources Sdn. Bhd., wholly owned subsidiary
companies of Proton Edar Sdn. Bhd. which in turn a wholly owned subsidiary of PMSB were liquidated
during the financial year. 221
(c) Proton Capital Sdn. Bhd., a wholly owned subsidiary company of the Company was liquidated during
the financial year.
25 STERLING YEARS
6 REVENUE
Revenue at the Group represents the invoiced value of goods sold and engineering services provided and
is presented net of taxes, discounts and commission paid to dealers.
Revenue at the Company represents income from shares held in subsidiary companies and associated
companies.
Revenue comprises:
Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Sale of vehicles, spare parts and accessories 7,993,619 6,220,872 - -

Rendering of engineering services 195,057 235,667 - -
Gross dividend income - - 101,203 362,357
Others 38,183 62,215 - -
8,226,859 6,518,754 101,203 362,357
Included in others is sale of rights for the use of intellectual property rights to an export market amounting
to RM1,742,000 (2009: RM19,612,000).
7 PROFIT/(LOSS) BEFORE FINANCE COST

Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
The following items have been charged/(credited)

in arriving at profit /(loss) before finance cost:
Gross dividends received/receivable from:

222 - subsidiary company, unquoted - - (96,600) (359,000)
- associated companies, unquoted - - (4,603) (3,357)
- others, quoted (915) (1,260) - -
25 STERLING YEARS
Research and development grant* (143,688) (80,656) - -

Property, plant and equipment:
- depreciation 432,612 450,346 - -
- written off 23,806 38,746 - -
- (gain)/loss on disposal (2,645) 19,417 - -
Impairment of investment in
an associated company - 6,678 - -
Investment:
- reversal of impairment (2,100) - (2,100) -
- provision for diminution in value 10,397 - 6,475 -
Intangible assets:
- amortisation 81,688 48,493 - -
- written off 55,814 - - -
- impairment - 20,802 - -
Write down of inventories** 80,128 114,950 - -
- loss on disposal 19 44 - -
- provision for diminution in value 282 1,084 - -
Research and development expenditure*** 68,618 45,127 - -
Provision for warranties (net of expected
reimbursement) (Note 34) 45,968 45,149 - -
Reversal of allowance for doubtful debts (23,534) (63,315) - -
Allowance for doubtful debts 27,183 45,616 - -
Bad debts written off 19,359 - - -
Statutory audit fees to
PricewaterhouseCoopers Malaysia:
- current year 620 599 88 88
- (over)/under provision in prior year (67) 114 27 60

7 PROFIT/(LOSS) BEFORE FINANCE COST (continued)
Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Other member firms of PricewaterhouseCoopers

International Limited:****
- current year 1,502 1,380 - -
- under provision in prior year 24 206 - - 223
Audit related fees to PricewaterhouseCoopers:
- Malaysia 486 505 48 -
25 STERLING YEARS
Non-audit fees to PricewaterhouseCoopers:
- Malaysia 232 902 - -
- Other member firms of PricewaterhouseCoopers
International Limited**** 592 959 - -
Provision for onerous contract - 22,139 - -
Rental:
- plant, machinery and equipment 2,536 1,765 - -
- land and buildings 12,228 16,725 - -
Foreign exchange loss/(gain):
- transactions 7,989 (7,481) - -
- translation 26,617 (8,284) - -
Rental income on land and buildings (514) (1,925) - -
Interest income (28,546) (42,089) (3,437) (4,618)
Automotive Development Fund
- amortisation of capital grant (31,255) (21,646) - -
* The Government of Malaysia, as part of the Second Stimulus Package under the Ninth Malaysia Plan had within
the ambit of the National Automotive Policy (‘NAP’) granted in 2009 a Research and Development (‘R&D’)
grant to Perusahaan Otomobil Nasional Sdn. Bhd. (‘PONSB’), a wholly owned subsidiary company. One of the
objectives of the NAP is to provide support and incentives to enhance competitiveness and capability of the
automotive industry through the development of the latest and more sophisticated technology. PONSB, being a
full fledged automotive manufacturer has complied with the requirements and had been allocated funds in the
form of a R&D grant.
During the financial year, PONSB has recognised R&D grant income amounting to RM143,688,000 (2009:
RM80,656,000) based on R&D expenditure that did not meet the capitalisation criteria, as set out in the Group’s
accounting policy (Note 3(d)(iii)).
** Cost of sales includes write-down of inventories amounting to RM80,128,000 (2009: RM114,950,000 of
which RM81,841,000 relates to certain vehicle models which were impacted by contraction in sales volume as
disclosed in Note 13(a) to the financial statements).
*** R&D expenditure including general R&D expenditure of a subsidiary company amounting to RM32,492,000
(2009: RM30,585,000) had been charged to cost of sales, and matched against R&D grant.
**** PricewaterhouseCoopers Malaysia and other member firms of PricewaterhouseCoopers International Limited are
separate and independent legal entities.
8 STAFF COST
Group
2010 2009
RM’000 RM’000
Wages, salaries and bonuses 644,297 598,390

Pension cost
- defined contribution plan 50,436 55,228
224 - defined benefit plan (Note 32(e)) 4,970 (8,042)
Other employee benefits 53,293 62,842
752,996 708,418
25 STERLING YEARS
Directors’ remuneration
The aggregate amount of emoluments received/receivable by the Directors of the Group and Company
during the financial year was as follows:
Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Non-executive Directors:
- allowances 695 584 524 424
- fees 695 939 223 217
- estimated monetary value
of benefits-in-kind 109 59 109 59
Executive Director:*
- salaries and bonuses 1,384 705 1,384 705
- defined contribution plan 248 109 248 109
- estimated monetary value
of benefits-in-kind 128 81 128 81
- fees - - 42 42
- allowances - - 11 16
3,259 2,477 2,669 1,653
* The Executive Director’s remuneration in the Company is fully recharged to a subsidiary company.

9 FINANCE COST
Group
2010 2009
RM’000 RM’000
Interest expense on:

Long term loans 5,892 6,957
Short term borrowings 4,069 6,110
Others 2,092 1,341 225
12,053 14,408
25 STERLING YEARS
10 TAXATION
Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Taxation in Malaysia
Current taxation:
- charge for the financial year 41,197 28,027 607 1,179
- write back of accrual in
respect of disputes - (18,240) - -
- over accrual in respect of
prior financial years (3,144) (31,216) (44) -
38,053 (21,429) 563 1,179
Taxation outside Malaysia
Current taxation:
- charge for the financial year 14,448 801 - -
- under/(over) accrual in respect of
prior financial years 269 (844) - -
14,717 (43) - -
Deferred taxation (Note 22)
Origination and reversal of

temporary differences (1,821) 15,344 - -
Tax benefits arising from previously
unrecognised tax losses (8,988) (11,267) - -
(10,809) 4,077 - -
Tax expense/(credit) 41,961 (17,395) 563 1,179
10 TAXATION (continued)
A numerical reconciliation between the average effective tax rate and the statutory tax rate effect is as
follows:
Group Company
2010 2009 2010 2009
% % % %
Malaysian statutory tax rate 25 (25) 25 25

226
Tax effects of:
- double deduction and incentive
25 STERLING YEARS
on qualifying expenditure (17) (3) - -

- expenses not deductible for tax purposes 3 1 1 -
- income not subject to tax (18) (11) (25) (25)
- current year tax losses not recognised 4 6 - -
- current year deductible temporary
differences not recognised 26 50 - -
- over accrual in respect of prior years (1) (16) - -
- recognition of previously unrecognised
deductible temporary differences (2) (2) - -
- recognition of previously
unrecognised tax losses (3) (4) - -
- different tax rates in subsidiary
companies outside Malaysia (1) (1) - -
Average effective tax rate 16 (5) 1 -
2010 2009 2010 2009

RM’000 RM’000 RM’000 RM’000
Previously unrecognised
temporary differences utilised
during the financial year 16,181 19,640 - -
Tax savings arising from
temporary differences 4,045 5,486 - -
Previously unrecognised tax losses

utilised during the financial year 35,953 45,068 - -
Tax savings arising from such tax losses 8,988 11,267 - -
Unabsorbed capital allowances

carried forward 1,879,043 1,964,254 - -
Unutilised tax losses carried forward 666,390 566,932 - -
Unutilised reinvestment allowances 2,060,732 1,993,363 - -


10 TAXATION (continued)
The effective tax rate is lower than the statutory tax rate due to double deduction for R&D expenditure,
recognition of non-taxable income and recognition of previously unrecognised tax losses and capital
allowances.
The tax write back in the previous financial year arose following an agreement with the Inland Revenue
Board (‘IRB’) to settle tax disputes in respect of a subsidiary company’s treatment of certain items in the
tax submissions for Years of Assessment (‘YA’)1989 to 1998. The basis of agreed claims was subsequently
applied for YA 1999 to 2002.
The tax recoverable amount of RM18,240,000 (2009: RM140,960,000) relates to settlement of

227
tax disputes for YA 1999 to 2002 (2009: YA 1989 to 2002) whilst the balance of RM7,061,000
(2009: RM19,650,000) relates to overpayment of tax liabilities.
25 STERLING YEARS
11 EARNINGS/(LOSS) PER SHARE
Basic earnings/(loss) per share is calculated by dividing the net profit/(loss) attributable to equity holders
of the Company by the weighted average number of ordinary shares in issue during the financial year.
Group
2010 2009
Net profit/(loss) attributable to equity holders of the Company (RM’000) 218,932 (301,806)
Weighted average number of ordinary shares in issue (‘000) 549,213 549,213
Basic earnings/(loss) per share (sen) 40 (55)
Diluted earnings/(loss) per share equals to basic earnings/(loss) per share.
12 DIVIDENDS
Dividends declared in respect of the financial year ended 31 March 2010 are as follows:
Group
2010 2009
RM’000 RM’000
Interim dividend of 5 sen per ordinary share less tax at 25% - 20,595
The Directors recommend the payment of a final dividend of 20 sen per ordinary share less tax at 25%
on 549,213,002 ordinary shares amounting to RM82,381,950 in respect of the financial year ended
31 March 2010, subject to the approval of members at the forthcoming Annual General Meeting.
13 PROPERTY, PLANT AND EQUIPMENT

Office
equipment,
furniture,
Freehold Plant and fittings and Work-in-
Note land Buildings machinery vehicles progress Total
Group RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
2010
228 Cost/valuation
At 1 April 2009 226,872 1,352,482 4,579,828 1,137,416 5,364 7,301,962

Currency translation differences (639) (6,952) (10,438) (9,546) - (27,575)
25 STERLING YEARS
Additions - 209 38,015 56,143 108,804 203,171

Disposals - - (10,726) (19,064) - (29,790)
Written off - (253) (66,916) (6,614) - (73,783)
Reclassification of completed
work-in-progress - 407 57,521 12,435 (70,363) -
Reclassification - (9,313) 9,313 - - -
Reclassification to
intangible assets 16 - - - (6) - (6)
At 31 March 2010 226,233 1,336,580 4,596,597 1,170,764 43,805 7,373,979
Accumulated depreciation
At 1 April 2009 - 477,676 2,793,840 735,725 - 4,007,241

Currency translation differences - (1,092) (6,370) (2,811) - (10,273)
Charge for the financial year - 52,343 292,714 87,555 - 432,612
Disposals - - (10,710) (15,256) - (25,966)
Written off - (160) (43,662) (6,155) - (49,977)
Adjustment in respect of
reversal of impairment loss - 28,252 52,757 34,025 - 115,034
At 31 March 2010 - 557,019 3,078,569 833,083 - 4,468,671
Accumulated impairment losses
At 1 April 2009 - 112,829 317,761 37,020 - 467,610

Currency translation differences - (15,455) (3,757) (5,027) - (24,239)
Charge for the financial year - - 6,000 - - 6,000
Reclassification - (1,232) (1,357) 2,589 - -
Reversal of impairment loss - (80,834) (53,503) (34,144) - (168,481)
At 31 March 2010 - 15,308 265,144 438 - 280,890
Net book value

At 31 March 2010 226,233 764,253 1,252,884 337,243 43,805 2,624,418

13 PROPERTY, PLANT AND EQUIPMENT (continued)
Office
equipment,
furniture,
Freehold Plant and fittings and Work-in-
2009
Cost/valuation
229
At 1 April 2008 236,362 1,396,863 4,375,404 1,074,479 27,858 7,110,966
Currency translation
25 STERLING YEARS
differences (2,611) (35,192) (45,094) (30,946) (88) (113,931)
Additions 759 2,457 22,629 85,685 351,251 462,781
Disposals (7,638) - (43,136) (20,848) (10,560) (82,182)
Acquisition through
business combination 17 - 2,794 420 26 - 3,240
Written off - (3,778) (38,668) (10,053) (19,212) (71,711)
Reclassification of completed
work-in-progress - 1,256 312,680 39,073 (353,009) -
Reclassification
from inventory - - - - 9,124 9,124
Reclassification to
non-current assets
held for sale 29 - (11,918) (4,407) - - (16,325)
At 31 March 2009 226,872 1,352,482 4,579,828 1,137,416 5,364 7,301,962
Accumulated depreciation
At 1 April 2008 - 434,149 2,558,858 682,161 - 3,675,168

Currency translation
differences - (7,849) (28,592) (14,004) - (50,445)
Charge for the financial year - 52,647 306,075 91,624 - 450,346
Disposals - - (19,571) (14,121) - (33,692)
Acquisition through
business combination 17 - 1,298 102 26 - 1,426
Written off - - (23,004) (9,961) - (32,965)
Reclassification to
non-current assets
held for sale 29 - (2,569) (28) - - (2,597)
At 31 March 2009 - 477,676 2,793,840 735,725 - 4,007,241

Office
equipment,
furniture,
Freehold Plant and fitting and Work-in-
Accumulated impairment losses
230 At 1 April 2008 13,536 137,365 79,632 54,819 - 285,352

Currency translation differences (13,536) (24,034) (18,759) (17,471) - (73,800)
Charge for the financial year - - 257,674 - - 257,674
25 STERLING YEARS
Reversal of impairment loss - (502) (786) (328) - (1,616)

At 31 March 2009 - 112,829 317,761 37,020 - 467,610
Net book value

At 31 March 2009 226,872 761,977 1,468,227 364,671 5,364 2,827,111
A piece of a subsidiary company’s freehold land was revalued on 5 September 1983 based on an
independent professional valuation. The surplus of RM36,882,000 arising from the revaluation was
credited to the capital reserves and subsequently utilised. Had this freehold land been carried at historical
cost, the net book value of freehold land that would have been included in the financial statements at the
end of the financial year would be RM22,448,000 (2009: RM22,448,000).
Property, plant and equipment of a wholly owned subsidiary company with a net book value of
RM169,229,000 (2009: RM111,777,000) was charged to a licensed bank as security for borrowings as
disclosed in Note 32(b) to the financial statements.
The net book value of the office equipment acquired under finance lease at the balance sheet date was
RM10,416,000 (2009: RM3,959,000).
The net cash outflow for the acquisition of property, plant and equipment during the financial year is:
Group
2010 2009
RM’000 RM’000
Total acquisition of property, plant and equipment 203,171 462,781

Less: Amount financed by hire purchase arrangements (7,253) (5,223)
Less: Amount acquired via ADF (Note 32(d)(ii)) (50,588) (31,049)
Net cash outflow on acquisition of property, plant and equipment 145,330 426,509

Impairment test for property, plant and equipment and capitalised development cost, included within
intangible assets
Assumptions and approach used – Group
The fair value of a cash generating unit or an asset group is measured based on market prices when
available. Where market prices are not available, the recoverable amounts are determined based on
value-in-use calculations. Embedded in the development of the cash flow projections are assumptions
and estimates derived from a review of the cash generating unit’s operating results, approved business
plans, expected market and industry growth rates, as well as, future economic conditions and other data.
231
Most of these factors used in assessing the fair values are outside the control of management, hence
these assumptions and estimates may change in future periods.
25 STERLING YEARS
(a) Malaysian operations
The carrying values of property, plant and equipment and capitalised development cost, included within
intangible assets of a subsidiary company totalling RM2,575,757,000 were tested for impairment in
the current financial year.
The impairment assessment performed in the current financial year resulted in an impairment loss of
RM6,000,000 in respect of plant and machinery for a slow moving model.
In the previous financial year, the softening of the automotive industry in the second half of the
financial year had resulted in a contraction in sales volume. Arising from this, a subsidiary company
undertook a test for impairment of its property, plant and equipment and capitalised development
cost relating to certain vehicles models impacted by volume contraction. As a result, an amount
of RM270,000,000 recognised as an impairment loss under other operating expenses, comprised
RM249,198,000 in respect of plant and machinery, while the balance of RM20,802,000 was related
to capitalised development cost, included within intangible assets.
The property, plant and equipment were allocated to the cash generating units which are identified
according to production plants and vehicle models.
(i) Assumptions and approach used
The value-in-use calculations apply a discounted cash flow model using cash flow projections
covering a five year period, and assuming a zero growth rate for subsequent periods up to
fourteen years. The projections over these periods were based on an approved business plan.
The business plan reflects the cash generating unit’s expectation of capacity utilisation, revenue
growth, operating costs and margins based on past experience, current assessment of market
share, expectations of market growth and industry growth.
The following are the key assumptions used in the cash flow projections:
• Business projections – The cash generating unit makes assumptions about the demand
for its products in the market place. These assumptions are used to drive the planning
assumptions for sales volume and mix. The cash generating unit also makes assumptions
about cost levels.

intangible assets (continued)
(a) Malaysian operations (continued)
(i) Assumptions and approach used (continued)
The following are the key assumptions used in the cash flow projections (continued):
232 • Business analysis – In line with the improved global economy, the overall sales volume used in
the projections indicates an increase from current levels due to the expected growth in sales
of completely-knocked-down (CKD) packs to the export markets and planned introduction of
25 STERLING YEARS
new models for which the product development capital expenditure has been approved.
Separate assessment is made for the Malaysian and the export markets. The Malaysian
market, being the major contributor to the Group’s margins indicates an increase in sales
volume from current levels for the first two years through planned introduction of new models
for which capital expenditure on project development has been approved. Thereafter, the
projected sales volume did not include future models for which capital expenditure on
project development has not been approved, hence, the projections for the remaining three
years indicate a reduction.
• Long-term growth rate – From the sixth year and onwards, a zero growth rate is assumed.
• Terminal values of production plants – Terminal values of the production plants in year
fourteen are assumed to be derived from the fair market values by an internal registered
valuer arising from the disposal of the land and buildings on which the three specific plants
are located. A discount factor of 6.8% was used to discount the terminal value which
reflects the prevailing term loan borrowing cost.
• Discount rates – In measuring the recoverable amounts based on the value-in-use calculation,
discount rates of 13.39% and 21.39% have been applied to domestic and export sales
respectively. The discount rate reflects the prevailing independent market rate applicable to
the Group.
• Economic projections – Assumptions regarding the general economic conditions are applied
in arriving at the industry sales volume. Other macro-economic assumptions, such as,
commodities prices, inflation rates, interest rates and foreign currency exchange rates have
also been considered.
(ii) Impact of possible changes in key assumptions
The sensitivity tests indicated that no further impairment loss is required where other realistic
variations are applied to key assumptions.

(b) Overseas operations
The carrying values of property, plant and equipment and capitalised development cost, included
within intangible assets totalling RM344,588,000 were tested for impairment in the current financial
year. The review indicated that no impairment losses were required for the current financial year
ended 31 March 2010 (2009: RM8,476,000 in relation to plant and machinery) as their recoverable
amounts were in excess of their carrying values. This is largely attributable to a change in management
233
whereby, fresh funds would be invested to develop new and better products to penetrate into the
premium sports car segment.
25 STERLING YEARS
The review also indicated that the impairment of property, plant and equipment previously provided
at the Group level is no longer required as the balance of impairment related mainly to buildings.
The balance of impairment provision amounting to RM53,447,000 (being accumulated impairment
of RM168,481,000 less depreciation of RM115,034,000 in Note 13) has been reversed to the
Consolidated Income Statements.
The property, plant and equipment and capitalised development cost, included within intangible
assets were allocated to the cash generating units which are identified according to production
facilities relating to cars and engineering businesses of the overseas subsidiary.
The recoverable amounts are determined based on value-in-use calculations. The value-in-use
calculations apply a discounted cash flow model using cash flow projections covering a
five-year period. The projections over these periods were based on an approved business plan and
reflect the subsidiary group’s expectation of plant utilisation, revenue growth, operating costs and
margins based on past experience and current assessment of market demand.
• Business analysis – For cars, the sales volumes used in the value-in-use calculation is based
on sales projections of existing models taking into consideration the projected lifecycle of
the models in line with the short range and long range product plans.
For engineering services, the third party sales projections are based on existing projects-in-
hand and include a forecast of new work to be won with emphasis on the 4-core competencies
and key service offerings.
• Terminal values – An estimated residual value based on the carrying values of the land and
buildings is used.

(b) Overseas operations (continued)
(i) Assumptions and approach used (continued)
The following are the key assumptions used in the cash flow projections (continued):
234 • Discount rates – For purposes of the value-in-use calculation, a discount rate of 10% has
been applied. This is based on the subsidiary group’s weighted average cost of capital and
is reflective of the prevailing market rate applicable to the subsidiary group and segment in
25 STERLING YEARS
which the Group operates in.
• Economic projections – In arriving at the industry sales volume, assumptions are

made regarding the general economic conditions in its key markets, as well as other
macro-economic assumptions relating to the automotive industry.
(ii) Impact of possible changes in key assumptions
The sensitivity test indicated that no further impairment loss is required where other realistic
variations are applied to key assumptions.
14 PREPAID LAND LEASE PAYMENTS

Group
2010 2009
RM’000 RM’000
Cost/Net book value:

At 1 April - 24,031
Currency translation differences - (1,347)
Reclassification to non-current assets held for sale (Note 29) - (22,684)
At 31 March - -

15 GOODWILL
Group
2010 2009
RM’000 RM’000
At 1 April 35,749 35,749

Less: Accumulated impairment loss (6,741) (6,741)
At 31 March 29,008 29,008
235
Impairment test for goodwill
The Group undertook an annual test for impairment of goodwill. The carrying amount of goodwill is allocated
25 STERLING YEARS
to the cash generating unit that the goodwill relates to, which is the distribution business in Malaysia.
The recoverable amount of the cash generating unit including goodwill in this test is determined based
on the value-in-use calculation. This value-in-use calculation applies a discounted cash flow model
using cash flow projections covering a five-year period for the distribution business in Malaysia. The
projections reflect the Group’s expectations of revenue growth, operating costs and margins based on
past experience and current assessment of market share, expectations of market growth and industry
growth.
• Business projections – The cash generating unit makes assumptions about the demand for its
products in the market place and are used to project the sales volume and mix.
• Business analysis – The sales volume used in the projections indicates an increase from current
levels for the first two years through planned introduction of new models for which capital
expenditure on project development has been approved. Thereafter, the projected sales volume
did not include future models for which capital expenditure on project development has not been
approved, hence, the projections for the remaining three years indicate a reduction.
• Discount rates – For purposes of the value-in-use calculation, a discount rate of 13.39% has
been applied. The discount rate reflects the prevailing independent market rate applicable to the
Group in Malaysia.
• Economic projections – Assumptions regarding the general economic conditions are considered
in arriving at the estimated sales volume and prices for the vehicles.
(ii) Sensitivity impact of possible changes in key assumptions
Sensitivity analysis shows that no impairment loss is required for the carrying amount of goodwill,
including where realistic variations are applied to key assumptions.
16 INTANGIBLE ASSETS
Capitalised
development Computer
cost software Total
RM’000 RM’000 RM’000
Group
2010
236 Cost
At 1 April 2009 493,128 71,265 564,393
Currency translation differences (7,595) - (7,595)
25 STERLING YEARS
Additions 268,237 6,387 274,624

Written off (55,814) - (55,814)
Reclassification from property, plant equipment (Note 13) - 6 6
At 31 March 2010 697,956 77,658 775,614
Amortisation
At 1 April 2009 59,401 52,522 111,923
Charge for the financial year 67,327 14,361 81,688
At 31 March 2010 123,966 66,883 190,849
Accumulated impairment loss

At 1 April 2009/31 March 2010 20,802 - 20,802
Net book value

At 31 March 2010 553,188 10,775 563,963

16 INTANGIBLE ASSETS (continued)
Capitalised
development Computer
cost software Total
RM’000 RM’000 RM’000
Group
2009
Cost 237
At 1 April 2008 275,804 65,133 340,937
25 STERLING YEARS
Additions 231,468 6,164 237,632
Written off - (16) (16)
Disposal - (16) (16)
At 31 March 2009 493,128 71,265 564,393
Amortisation
At 1 April 2008 27,739 38,006 65,745
Charge for the financial year 33,945 14,548 48,493
Written off - (16) (16)
Disposal - (16) (16)
At 31 March 2009 59,401 52,522 111,923

At 1 April 2008 - - -
Charge for the financial year (Note 13) 20,802 - 20,802
At 31 March 2009 20,802 - 20,802
Net book value

At 31 March 2009 412,925 18,743 431,668
The amortisation period for intangible assets ranges from 3 to 10 years (2009: 3 to 10 years).
During the financial year, a subsidiary company acquired computer software with an aggregate cost of
RM6,387,000 (2009: RM6,164,000) of which RM2,917,000 (2009: Nil) was acquired by means of
finance lease (Note 32(c)). The net book value of the computer software acquired under finance lease at
the balance sheet date was RM2,880,000 (2009: Nil).
Impairment test for capitalised development cost has been performed together with the related property,
plant and equipment as explained in Note 13 to the Financial Statements.
17 SUBSIDIARY COMPANIES
Company
2010 2009
RM’000 RM’000
Unquoted shares at cost:

At 1 April 2,036,303 2,036,303
Less: Impairment loss (327,652) (327,652)
238 At 31 March 1,708,651 1,708,651
25 STERLING YEARS
The details of the subsidiary companies are as follows:
Country of Group’s
Name Principal activities incorporation effective interest
2010 2009
% %
Perusahaan Otomobil Manufacture, assembly Malaysia 100 100

Nasional Sdn. Bhd.^ and sales of motor
vehicles and related
products
Proton Tanjung Malim Assembly of motor vehicles Malaysia 100 100

Sdn. Bhd.^ and related products
Proton Marketing Investment holding Malaysia 100 100

Sdn. Bhd.
Lotus Advance Investment holding Malaysia 100 100

Technologies Sdn. Bhd.
Proton Hartanah Sdn. Bhd. Investment holding Malaysia 100 100
Proton Capital Sdn. Bhd. Liquidated during the Malaysia - 100

financial year
Subsidiary companies of
Perusahaan Otomobil
Nasional Sdn. Bhd.
PT Proton Cikarang Ceased operations Indonesia 100 100

Indonesia
Proton Automobiles Dormant British Virgin 100 100

(China) Limited^ Islands

17 SUBSIDIARY COMPANIES (continued)
2010 2009
% %
Proton Marketing
Sdn. Bhd. 239
Proton Cars (UK) Importation and England 100 100
Limited*^ distribution of motor
25 STERLING YEARS
products
Proton Cars Australia Importation and Australia 100 100

Pty. Limited*^ distribution of motor
products
Proton Edar Sdn. Bhd.^ Sales of motor vehicles, Malaysia 100 100
related spare parts and
accessories
Proton Motors (Thailand) Importation and wholesale Thailand 100 100

Co. Limited* of motor vehicles and
related products
Proton Cars Benelux In Members’ Voluntary Belgium 100 100

NV. SA*^ Liquidation
Subsidiary companies
of Lotus Advance
Proton Engineering Dormant Malaysia 100 100

Research Technology
Sdn. Bhd.^
Lotus Group Investment holding England 100 100

International Limited*^
Subsidiary company of
Proton Hartanah
Sdn. Bhd.
Proton Properties Property development and Malaysia 100 100

Sdn. Bhd.^ management

2010 2009
% %
Proton Cars Australia Pty.
240 Limited
Lotus Cars Australia Importation and Australia 100 100

Pty. Limited*^ distribution of motor
25 STERLING YEARS

products
Proton Edar Sdn. Bhd.
Proton Singapore Importation and Singapore 100 100

Pte. Limited*^ distribution of motor
products
PT Proton Edar Importation and wholesale Indonesia 95 95

Indonesia* of motor vehicles and
related products
Proton Edar Resources Liquidated during the Malaysia - 100

Sdn. Bhd.^ financial year
Proton Edar Ventures Liquidated during the Malaysia - 100

Sdn. Bhd.^ financial year
Lotus Group International
Limited
Group Lotus Plc*^ Investment holding England 100 100


2010 2009
% %
Group Lotus Plc
Lotus Cars Limited*^ Manufacture of motor England 100 100

241
vehicles and engineering
consultancy services
25 STERLING YEARS
Lotus Body Investment holding England 100 100
Engineering Limited*^
Lotus Motorsports Dormant England 100 100

Limited*^
Lotus Holdings Inc.*^ Investment holding United States of 100 100

America
Lotus Cars Limited
Lotus Engineering Engineering England 100 100

Limited*^ consultancy services
Lotus Engineering Engineering People’s Republic 100 100

Company Limited consultancy services of China
(Shanghai)*
Lotus Body Engineering
Limited
Lotus Lightweight Investment holding England 100 100

Structures Holdings
Limited*

2010 2009
% %
Lotus Lightweight
242 Structures Holdings
Limited
Lotus Lightweight Manufacture of England 100 100

25 STERLING YEARS
Structures Limited* automotive components
Lotus Engineering
Limited
Lotus Engineering Engineering consultancy Malaysia 100 100

(Malaysia) Sdn. Bhd.^ services
Lotus Holdings Inc.
Lotus Engineering Inc.*^ Engineering consultancy United States of 100 100

services America
Lotus Cars USA Inc.*^ Sales of motor vehicles United States of 100 100
and related spare parts America
and accessories
* Audited by a member firm of PricewaterhouseCoopers International Limited which is a separate and
independent legal entity from PricewaterhouseCoopers, Malaysia.
^ Consolidated by merger method of accounting prior to 1 April 2006.


In the prior year, Lotus Body Engineering Limited, a wholly owned subsidiary company of Lotus Group
International Limited, which in turn is a wholly owned subsidiary company of the Company acquired the
entire issued and paid up share capital of Lotus Lightweight Structures Holdings Limited.
The effects of the acquisition on the financial results of the Group during the last financial year are as
follows:
2009
RM’000 243
Revenue 46,204
25 STERLING YEARS
Operating costs (57,957)
Loss before tax (11,753)
Tax expense -
Loss for the financial year (11,753)
The details of net assets acquired and cash flows arising from the acquisition of the subsidiary company
during the last financial year are as follows:
Acquiree’s
carrying value Fair value
RM’000 RM’000
Property, plant and equipment (Note 13) 4,995 1,814

Inventories 5,173 5,173
Receivables, deposits and prepayments 7,512 7,512
Deposits, bank and cash balances 4,520 4,520
Payables and other liabilities (14,355) (18,497)
Net assets/Fair value of net assets acquired 7,845 522
Details of cash flow arising from the acquisition are as follows:
Purchase consideration settled in cash 522

Less: Cash and cash equivalents of subsidiary company acquired (4,520)
Cash inflow to the Group on acquisition of subsidiary company 3,998
Had the acquisition taken effect at the beginning of the previous financial year, the contributed revenue
and loss to the Group would have been RM55,193,000 and RM13,160,000 respectively.
18 ASSOCIATED COMPANIES
Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Unquoted shares at cost 59,252 59,252 13,600 13,600

Share of post-acquisition reserves 126,266 131,993 - -
185,518 191,245 13,600 13,600
244 Less: Impairment loss (32,878) (32,878) - -
152,640 158,367 13,600 13,600
25 STERLING YEARS
The Group’s share of the assets, liabilities, revenue and expenses of the associated companies are as
follows:
Group
2010 2009
RM’000 RM’000
Non-current assets 107,560 112,703

Current assets 145,422 161,000
Current liabilities (91,365) (105,804)
Non-current liabilities (8,977) (9,532)
Net assets 152,640 158,367
Revenue 227,976 236,058

Expenses (excluding tax) (222,019) (222,351)
Profit before taxation 5,957 13,707
Taxation (422) 6,513
Profit for the financial year 5,535 20,220
The details of the associated companies are as follows:
2010 2009
% %
PHN Industry Sdn. Bhd. Manufacture and sales Malaysia 35 35

of stamped parts and
sub-assembly of
automotive metal
components

18 ASSOCIATED COMPANIES (continued)
2010 2009
% %
Marutech Elastomer Manufacture and Malaysia 25 25

Industries Sdn. Bhd. production of moulded
products, extruded and
rubber hoses for motor
245
vehicles, motorcycle and
25 STERLING YEARS
other related products
Exedy (Malaysia) Sdn. Bhd. Manufacture and Malaysia 45 45

assembly of manual
clutch and automatic
transmission parts
Associated company of
Perusahaan Otomobil
Nasional Sdn. Bhd.
Vina Star Motors Import, assembly Socialist Republic 25 25

Corporation and distribution of of Vietnam
motor vehicles
Proton Hartanah Sdn. Bhd.
Proton City Development Property developer and Malaysia 40 40

Corporation Sdn. Bhd. project management
Proton Cars (UK) Limited
Proton Finance Limited Provision of dealer and England 49.99 49.99

customer financing
Proton Edar Sdn. Bhd.
Netstar Advance Systems Manufacture, assembly Malaysia 40 40

Sdn. Bhd. and sales of vehicle
tracking devices
18 ASSOCIATED COMPANIES (continued)

2010 2009
% %
Proton Automobile
246 (China) Limited
Goldstar Proton Dormant People’s Republic 49 49

Automobiles Co. Limited* of China
25 STERLING YEARS
Lotus Advance
Miyazu (Malaysia) Development, marketing Malaysia 51 51

Sdn. Bhd.** and sale of products
and provision of services
relating to dies, moulds
and jigs
* The Group has resolved to dissolve the associated company via an arbitration process (Note 42(c)).
** Company in which the Group owns more than 50%. However, although the Group exercises significant
influence, it does not have control over its financial and operating policies.
The share of capital commitments relating to the associated companies is as follows:
Group
2010 2009
RM’000 RM’000
Capital commitments
Capital expenditure for property, plant and equipment

approved but not provided for in the financial statements:
Contracted for 468 233

Not contracted for 5,159 1,736

19 JOINTLY CONTROLLED ENTITIES
Group
2010 2009
RM’000 RM’000
Unquoted shares at cost

At 1 April 2009 135,534 136,648
Liquidated - (1,114)
At 31 March 2010 135,534 135,534 247
25 STERLING YEARS
At 1 April 2009 - 1,114
Liquidated - (1,114)
At 31 March 2010 - -
Share of post-acquisition reserves 67,011 60,088
202,545 195,622
The Group’s share of the assets, liabilities, revenue and expenses of the jointly controlled entities are as
follows:
Group
2010 2009
RM’000 RM’000
Non-current assets 236,858 290,168

Current assets 199,151 151,926
Current liabilities (93,566) (82,559)
Non-current liabilities (139,898) (163,913)
Net assets 202,545 195,622
Revenue 190,574 175,673

Expenses (excluding tax) (170,480) (156,000)
Profit before taxation 20,094 19,673
Taxation (6,859) (5,079)
Profit for the financial year 13,235 14,594
19 JOINTLY CONTROLLED ENTITIES (continued)

The details of the jointly controlled entities are as follows:
2010 2009
% %
Jointly controlled entity of

248 Proton Marketing
Sdn. Bhd.
25 STERLING YEARS
Proton Parts Centre Trading in motor vehicle Malaysia 55 55

Sdn. Bhd.* components, spare parts
and accessories
Jointly controlled entity

of Group Lotus Plc
Lotus Finance Limited Provision of motor England 49.9 49.9

vehicles financing

of Proton Edar Sdn. Bhd.
Proton Commerce Provision of motor Malaysia 50 50

Sdn. Bhd. vehicles financing
* Company in which the Group owns more than half of the voting powers. However, as the Group
only has joint control over its financial and operating policies, this investment is treated as a jointly
controlled entity.
The share of capital commitments relating to the jointly controlled entities is as follows:
Group
2010 2009
RM’000 RM’000
Capital commitments
Capital expenditure for property, plant and equipment approved

but not provided for in the financial statements:
Not contracted for 1,438 1,062


20 AMOUNTS DUE FROM SUBSIDIARY COMPANIES
Company
2010 2009
Less than More than Less than More than
1 year 1 year Total 1 year 1 year Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Amounts due from

subsidiary companies 59,978 - 59,978 58,912 - 58,912 249
Advances to a
subsidiary company - 232,946 232,946 - 177,870 177,870
25 STERLING YEARS
59,978 232,946 292,924 58,912 177,870 236,782
The amounts due from subsidiary companies are denominated in Ringgit Malaysia, interest free and
repayable on demand.
Advances to a subsidiary company are denominated in Ringgit Malaysia, repayable after 6 years and bears
interest at 3.5% per annum.
21 INVESTMENTS
Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Unquoted investments in Malaysia:

At cost 13,347 13,347 8,575 8,575
Allowance for diminution in value (11,247) (2,950) (6,475) (2,100)
2,100 10,397 2,100 6,475
Reclassification to non-current assets
held for sale (Note 29) (2,100) - (2,100) -
- 10,397 - 6,475
22 DEFERRED TAXATION
Deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current
tax assets against current tax liabilities and when the deferred taxes relate to the same tax authority.
The following amounts, determined after appropriate offsetting, are shown in the Consolidated Balance
Sheets:
Group
2010 2009
250 RM’000 RM’000
Subject to income tax:

Deferred tax assets 15,033 5,727
25 STERLING YEARS
Deferred tax liabilities (10,740) (12,243)

4,293 (6,516)
Movement of deferred tax

At start of financial year (6,516) (2,439)
Credited/(charged) to income statement (Note 10)
- property, plant and equipment 1,720 (8,841)
- capitalised development cost (968) (43,436)
- allowances and provisions 8,136 49,624
- others 1,921 (1,424)
10,809 (4,077)
At end of financial year 4,293 (6,516)
Deferred tax assets (before offsetting)

- property, plant and equipment - 17
- allowances and provisions 94,210 86,074
- others 497 561
94,707 86,652
Offset of deferred tax liabilities (79,674) (80,925)
Deferred tax assets (after offsetting) 15,033 5,727
Deferred tax liabilities (before offsetting)

- capitalised development cost (79,332) (78,364)
- property, plant and equipment (11,082) (12,819)
- others - (1,985)
(90,414) (93,168)
Offset against deferred tax assets 79,674 80,925
Deferred tax liabilities (after offsetting) (10,740) (12,243)

22 DEFERRED TAXATION (continued)
The tax effect of temporary differences (which have no expiry dates) for which no deferred tax assets are
recognised in the balance sheet of certain subsidiary companies of the Group as at 31 March 2010, are
as analysed below:
Group
2010 2009
RM’000 RM’000
Temporary differences of which no deferred tax assets are recognised 251

Unrecognised tax losses 183,250 158,263
25 STERLING YEARS
Unabsorbed capital allowances 476,475 497,646
Unrecognised reinvestment allowances 515,183 498,341
Other temporary differences 84,639 79,082
As at 31 March 2010, there are no temporary differences associated with unremitted earnings of subsidiary
companies, associated companies and joint controlled entities for the recognition of deferred tax liabilities
(2009: Nil).
23 INVENTORIES
Group
2010 2009
RM’000 RM’000
Raw materials:
- completely knocked-down packs of vehicles 112,449 244,888
- others 125,883 164,115
Parts, accessories and general stores 66,910 68,862
Work-in-progress 274,458 219,188
Finished vehicles 581,569 640,945
Goods-in-transit 47,221 35,723
Land held for development 10,049 10,049
Properties for sale 8,673 11,311
1,227,212 1,395,081
24 TRADE AND OTHER RECEIVABLES

Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Trade receivables 621,177 611,944 - -

Allowance for doubtful debts (54,429) (51,583) - -
566,748 560,361 - -
252
Other receivables 149,397 125,820 749 145
Allowance for doubtful debts (25,891) (22,954) - -
25 STERLING YEARS
123,506 102,866 749 145
Government grant receivable 99,344 80,656 - -

Warranty claims reimbursable (Note 34) 95,758 111,451 - -
Prepayments 20,957 20,368 - -
Deposits 14,087 14,393 - -
920,400 890,095 749 145
The currency exposure profile of trade and other receivables is as follows:
Currency exposure profile as at 31.3.2010

Ringgit Thai US
Malaysia Baht Dollar Euro Others Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 581,911 - 40,657 21,716 3,874 648,158

Pound Sterling - - 103,023 11,295 30,209 144,527
Thai Baht - 84,700 - - - 84,700
Indonesian Rupiah - - - - 38,329 38,329
Others - - - 177 4,509 4,686
581,911 84,700 143,680 33,188 76,921 920,400
Company
Functional currency
Ringgit Malaysia 749 - - - - 749


24 TRADE AND OTHER RECEIVABLES (continued)
The currency exposure profile of trade and other receivables is as follows (continued):

Ringgit Pound US
Malaysia Sterling Dollar Euro Others Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency 253
Ringgit Malaysia 530,497 31,764 78,307 21,985 51,611 714,164
25 STERLING YEARS
Pound Sterling - 37,178 82,823 15,503 2,410 137,914
Indonesian Rupiah - - - - 31,044 31,044
Others - - - 198 6,775 6,973
530,497 68,942 161,130 37,686 91,840 890,095
Company
Functional currency
Credit terms of trade receivables for the Group range from 14 to 180 days (2009: 14 to 360 days).
However, the majority of the Group’s trade receivables have a credit term between 14 to 90 days (2009:
14 to 90 days).
Group sales are concentrated in Malaysia with one major third party customer in Malaysia making up 17.4%
(2009: 27.5%) of total Group revenue.
The Group has no significant concentration of credit risk except for an amount of RM73,520,000
(2009: RM81,138,000) due from a single customer. The Directors are of the view that the credit risk is
minimal in view of the stability and historical settlement of the receivables from this customer.
25 AMOUNTS DUE FROM ASSOCIATED COMPANIES

The amounts due from associated companies arose from normal trade transactions. These amounts have
credit terms ranging from 30 to 60 days (2009: 30 to 60 days).
The functional currency of the Company is Ringgit Malaysia and the amounts due from associated
companies as at 31 March 2010 are denominated in Ringgit Malaysia.
The currency exposure profile of amounts due from associated companies is as follows:
254 Currency exposure profile as at 31.3.2010

Ringgit Pound
Malaysia Sterling Total
25 STERLING YEARS
RM’000 RM’000 RM’000

Group
Functional currency
Ringgit Malaysia 34,599 16 34,615

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency

Pound Sterling - 49 49
18,219 65 18,284

26 AMOUNTS DUE FROM JOINTLY CONTROLLED ENTITIES
The amounts due from jointly controlled entities arose from normal trade transactions. These amounts
have credit terms ranging from 30 to 45 days (2009: 30 to 45 days).
The currency exposure profile of amounts due from jointly controlled entities is as follows:

Ringgit Pound
RM’000 RM’000 RM’000 255
Group
Functional currency
25 STERLING YEARS
Pound Sterling - 2,695 2,695
8,611 2,710 11,321

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency

8,894 2,459 11,353
27 CURRENT INVESTMENTS
Group
2010 2009
RM’000 RM’000
Lower of cost and market value:
Commercial papers and corporate debt
- quoted investments in Malaysia 584 584

256 - unquoted investments in Malaysia 10,458 15,813
11,042 16,397
Provision for diminution in value (1,366) (1,084)
25 STERLING YEARS
9,676 15,313
Market value of quoted investments:

Commercial papers and corporate debt 654 724
28 DEPOSITS, BANK AND CASH BALANCES

Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Short term funds deposited

with licensed banks 1,385,703 717,221 248,119 208,955
Bank and cash balances 266,386 196,629 257 468
1,652,089 913,850 248,376 209,423
The maturity profile of short term

funds is as follows:
0 - 1 month 845,272 486,044 83,088 51,159
2 - 3 months 388,206 224,784 106,102 157,796
4 - 6 months 68,052 - 10,252 -
6 - 12 months 59,173 6,393 48,677 -
More than 1 year 25,000 - - -
1,385,703 717,221 248,119 208,955
Bank balances are deposits held at call with banks.


28 DEPOSITS, BANK AND CASH BALANCES (continued)
The currency exposure profile of deposits, bank and cash balances is as follows:

Ringgit Pound US Australian
Malaysia Sterling Dollar Dollar Others Total
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Ringgit Malaysia 1,440,330 10,015 50,662 33,014 9,727 1,543,748
25 STERLING YEARS
Pound Sterling - 14,194 27,254 - 12,053 53,501
Australian Dollar - - - 21,629 - 21,629
Others - - 72 - 33,139 33,211
1,440,330 24,209 77,988 54,643 54,919 1,652,089

Ringgit Pound US
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 717,899 4,978 23,536 5,194 21,079 772,686

Pound Sterling - 67,549 16,305 10,165 5,554 99,573
Australian Dollar - - - - 15,012 15,012
Others - - - 1,086 25,493 26,579
717,899 72,527 39,841 16,445 67,138 913,850
Deposits, bank and cash balances of the Company as at 31 March 2010 and 31 March 2009 are
denominated in Ringgit Malaysia.
The weighted average effective interest rates of deposits at the balance sheet date were 2.34%
(2009: 2.59%) per annum for the Group and 2.24% (2009: 1.90%) per annum for the Company.
The Group has unutilised banking facilities amounting to RM777.3 million (2009: RM623.7 million) as at
31 March 2010.
29 NON-CURRENT ASSETS HELD FOR SALE

Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Non-current assets classified as held for sale:
- property, plant and equipment

(Note 13) 11,599 13,728 - -
258 - prepaid land lease payments (Note 14) 23,232 22,684 - -
- investments (Note 21) 2,100 - 2,100 -
36,931 36,412 2,100 -
25 STERLING YEARS
30 SHARE CAPITAL
Group and Company
2010 2009
RM’000 RM’000
Authorised:
Ordinary shares of RM1.00 each
At start/end of financial year 1,000,000 1,000,000
Issued and fully paid:

Ordinary shares of RM1.00 each
At start/end of financial year 549,213 549,213
31 RESERVES
(a) Retained earnings
Under the single-tier tax system which came into effect from the year of assessment 2008, companies
are not required to have tax credits under Section 108 of the Income Tax Act, 1967 for dividend
payment purposes. Dividends paid under this system are tax exempt in the hands of shareholders.
Companies with Section 108 credits as at 31 December 2007 may continue to pay franked dividends
until the Section 108 credits are exhausted or 31 December 2013 whichever is earlier unless they
opt to disregard the Section 108 credits to pay single-tier dividends under the special transitional
provisions of the Finance Act, 2007.
As at 31 March 2010, the Company has sufficient Section 108 tax credits to frank approximately
RM1,377.0 million (2009: RM1,377.0 million) of its retained earnings if paid out as dividends.
In addition, the Company has tax exempt income as at 31 March 2010 amounting to approximately
RM331.1 million (2009: RM326.5 million) available for distribution of tax exempt dividends to its
shareholders.

31 RESERVES (continued)
(b) Capital reserve
The capital reserve arose as a result of a Group reorganisation exercise whereby all existing shareholders
of Perusahaan Otomobil Nasional Sdn. Bhd. (‘PONSB’) exchanged all their ordinary shares of RM1.00
each comprising 549,213,000 ordinary shares in PONSB for 549,213,000 new ordinary shares of
RM1.00 each in the Company in a one-for-one share exchange on 5 April 2004. Following the share
for share exchange, the Company has no share premium. Accordingly, the amount of share premium
previously recognised on consolidation has been re-designated as capital reserve.
(c) Asset revaluation reserve

259
The asset revaluation reserve arose as a result of a fair value adjustment of the 51% equity interest
25 STERLING YEARS
previously held in PT Proton Cikarang Indonesia as a jointly controlled entity upon the acquisition of
the remaining 49% equity interest on 10 August 2007.
32 LONG TERM LIABILITIES

Group
2010 2009
RM’000 RM’000
Unsecured:
Long term loan (Note 32(a)) - 47,879
Portion repayable within twelve months (Note 37) - (47,879)
- -
Secured:
Long term loan (Note 32(b)) 49,415 67,893
Portion repayable within twelve months (Note 37) (19,766) (15,668)
29,649 52,225
Lease and hire purchase creditors (Note 32(c)) 9,111 3,395

Less: Portion repayable within twelve months (Note 33) (6,546) (858)
2,565 2,537
Automotive Development Fund (Note 32(d)) 37,288 21,686

Employee retirement benefits (Note 32(e)) 19,148 25,068
88,650 101,516
32 LONG TERM LIABILITIES (continued)

The currency exposure profile of the long term liabilities is as follows:

Ringgit Pound
RM’000 RM’000 RM’000
Group
260 Functional currency
Ringgit Malaysia 38,327 - 38,327

25 STERLING YEARS

38,327 50,323 88,650

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency

21,686 79,830 101,516
(a) Long term loan – unsecured
The long term loan balance of RM47.9 million, which was interest free had been reclassified to short
term loan and subsequently repaid during the financial year.

(b) Long term loan – secured
Group
2010 2009
RM’000 RM’000
The long term loan is repayable as follows:
Within one year 19,766 15,668 261

Between one and two years 19,766 20,890
More than two years 9,883 31,335
25 STERLING YEARS
49,415 67,893
The long term loan is secured over a subsidiary company’s fixed and floating assets as disclosed in
Note 13 and bears interest rates of 3.5% - 4.5% (2009: 7.32%) per annum.
(c) Lease and hire purchase creditors – secured
The lease and hire purchase arrangements obtained by subsidiary companies are secured against the
related assets of the respective subsidiary companies.
Group
2010 2009
RM’000 RM’000
The lease and hire purchase creditors are repayable as follows:
Within one year 7,075 1,084

Between one and two years 1,814 1,084
Between two and five years 927 1,714
9,816 3,882
Less: Future finance charges (705) (487)
9,111 3,395
Current (Note 33) 6,546 858

Non-current 2,565 2,537
9,111 3,395
The lease and hire purchase creditors bear an interest rate of 7.5% (2009: 7.5%) per annum.

(d) Automotive Development Fund
The Government of Malaysia approved the setting up of an Automotive Development Fund (‘ADF’)
under the Ninth Malaysia Plan with the objective of modernising and automating the manufacturing
processes, improving efficiency, productivity, quality and the application of automation for the
Malaysian automotive industry.
As at 31 March 2010, the Government of Malaysia had disbursed a total of RM110 million to the
262 Group to be utilised for payments to external parties for the purpose of developing and promoting a
competitive and viable domestic automotive sector as a means to achieve the objective of the ADF.
Group
25 STERLING YEARS
2010 2009
RM’000 RM’000
The ADF comprises:
(i) ADF liabilities 20,512 14,467

(ii) Capital grant 28,736 9,403
49,248 23,870
Less: Current portion of capital grant (11,960) (2,184)
(i) ADF liabilities

At 1 April 14,467 45,343
Add: Additional ADF grant received during
the financial year 60,000 -
Interest earned during the financial year 777 681
75,244 46,024
Less: Utilised during the financial year (54,732) (31,557)
At 31 March (Note 43) 20,512 14,467
(ii) Capital grant

At 1 April 9,403 -
Add: Received during the financial year (Note 13) 50,588 31,049
Less: Amortisation (31,255) (21,646)
31 March 28,736 9,403
Current 11,960 2,184

28,736 9,403
The current portion of the capital grant is presented within other payables (Note 33).

(e) Employee retirement benefits
The employee retirement benefits represents the scheme operated by a subsidiary company.
(i) Defined contribution plans
The Group pays contributions to publicly or privately administered pension plans on either a
mandatory, contractual or voluntary basis depending on the nature of the defined contribution
plans. The Group has no further payment obligations once the contributions have been paid.
The contributions are recognised as employee benefit expense when they are due. Prepaid 263
contributions are recognised as an asset to the extent that a cash refund or reduction in the
future payments is available.
25 STERLING YEARS
(ii) Defined benefit plan
Lotus Group Scheme – defined benefit scheme
Lotus Group International Limited and its subsidiary companies (‘Lotus Group’), operate a defined
benefit scheme, the Lotus Pension Plan. The assets are held in separate trustee administered
funds. In addition, it provides life assurance cover for all employees.
Contributions to the scheme are charged to the income statement so as to spread the cost of
pensions over employees’ working lives with the Lotus Group. The contributions are determined
by a qualified actuary. An actuarial valuation of the plan was carried out for the period from
1 April 2009 to 31 March 2010.
The movements during the financial year in the Consolidated Balance Sheets are as follows:
Group
2010 2009
RM’000 RM’000
At 1 April 25,068 50,095

Currency translation differences (1,877) (7,616)
Charged/(credited) to income statement (Note 8) 4,970 (8,042)
Contributions paid (9,013) (9,369)
At 31 March 19,148 25,068

(e) Employee retirement benefits (continued)
(ii) Defined benefit plan (continued)
The amounts recognised in the Consolidated Balance Sheets are analysed as follows:
Group
2010 2009
RM’000 RM’000
264
Present value of obligation 358,343 234,156
Fair value of plan assets (313,138) (224,494)
25 STERLING YEARS
Shortfall of funded plan 45,205 9,662

Unrecognised actuarial (loss)/gain (26,057) 15,406
Liability on balance sheet 19,148 25,068
The movements in the defined benefit obligation during the financial year are as follows:
Group
2010 2009
RM’000 RM’000
At 1 April 234,156 316,128

Interest cost 17,022 18,926
Current service cost 2,952 4,266
Employee contributions 3,662 3,817
Benefits paid (8,410) (11,495)
Actuarial loss/(gain) on obligation 8,331 (41,898)
Effect of changes in assumptions 116,233 -
At 31 March 358,343 234,156

The movements in the fair value of plan assets during the financial year are as follows:
Group
2010 2009
RM’000 RM’000 265
At 1 April 224,494 341,917
25 STERLING YEARS
Expected return on plan assets 15,004 21,162
Employer contributions 9,013 9,369
Employee contributions 3,662 3,817
Benefits paid (8,410) (11,495)
Actuarial gain/(loss) on plan assets 92,909 (84,705)
At 31 March 313,138 224,494
The mortality assumptions used were as follows:
Group
2010 2009
Age Age
Longevity at age 65 for current pensioners:

- Male 85.9 84.9
- Female 88.3 87.9
Longevity at age 65 for future pensioners:
- Male 87.0 86.1
- Female 89.3 89.1

The expenses recognised in the Consolidated Income Statements are analysed as follows:
Group
2010 2009
266 RM’000 RM’000
Current service cost 2,952 4,266

Interest cost 17,022 18,926
25 STERLING YEARS
Expected return on plan assets (15,004) (21,162)

Net actuarial gain recognised in financial year - (10,072)
Total, included in staff costs within
administrative expenses (Note 8) 4,970 (8,042)
Actual return/(loss) on plan assets 107,913 (63,543)
The principal actuarial assumptions used in respect of the Group’s defined benefit plan were as
follows:
Group
2010 2009
% %
Discount rates 5.60 6.90

Expected return on plan assets:
- equity 6.75 7.25
- bonds 4.00 4.50
- others 4.00 4.50
Expected rate of salary increase 4.70 4.00
Expected rate of pension payment increase 3.50 3.00
Inflation 3.70 3.00
The expected return on the average value of the assets over the period is calculated using the
long-term average rate of return expected over the remaining term of the Lotus Pension Plan’s
liabilities.

33 TRADE AND OTHER PAYABLES
Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Trade payables 853,843 617,725 - -

Other payables 80,904 95,597 535 482
Accruals 611,292 487,229 - -
Payments received in advance for 267
engineering contracts 77,779 76,249 - -
Lease and hire purchase creditors
25 STERLING YEARS
- current portion (Note 32(c)) 6,546 858 - -
1,630,364 1,277,658 535 482
The currency exposure profile of trade and other payables is as follows:

Ringgit Pound US
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia 1,240,224 3,930 86,997 29,743 39,893 1,400,787

Pound Sterling - 147,164 10,372 20,142 23,334 201,012
Others - - - 184 28,381 28,565
1,240,224 151,094 97,369 50,069 91,608 1,630,364
Company
Functional currency

33 TRADE AND OTHER PAYABLES (continued)

The currency exposure profile of trade and other payables is as follows (continued):
Currency exposure as at 31.3.2009

Ringgit Pound US
RM’000 RM’000 RM’000 RM’000 RM’000 RM’000
Group
Functional currency
268
Ringgit Malaysia 959,908 523 115,677 7,080 30,821 1,114,009
Pound Sterling - 127,742 3,779 22,584 1,599 155,704
25 STERLING YEARS
Others - - - 203 7,742 7,945

959,908 128,265 119,456 29,867 40,162 1,277,658
Company
Functional currency

Terms of trade payables granted to the Group and Company vary up to 60 days (2009: up to 60 days) credit.
34 PROVISIONS
Group
Provision Onerous
for warranty contract Total
RM’000 RM’000 RM’000
2010
At 1 April 167,640 22,139 189,779
Charge to income statement (Note 7) 45,968 - 45,968
Warranties reimbursable 24,320 - 24,320
Provision for the financial year 70,288 - 70,288
Utilised during the financial year (61,815) (12,079) (73,894)
At 31 March 174,344 10,060 184,404
2009
At 1 April 186,556 - 186,556
Charge to income statement (Note 7) 45,149 22,139 67,288
Warranties reimbursable 43,054 - 43,054
Provision for the financial year 88,203 22,139 110,342
Utilised during the financial year (102,257) - (102,257)
At 31 March 167,640 22,139 189,779

34 PROVISIONS (continued)
The Group expects to be reimbursed by suppliers in respect of warranties amounting to RM95,758,000
(2009: RM111,451,000) as disclosed in Note 24 to the financial statements.
35 AMOUNTS DUE TO ASSOCIATED COMPANIES

Amounts due to associated companies arose from normal trade transactions, are denominated in Ringgit
Malaysia, unsecured, interest free and payable within 30 to 60 days (2009: 30 to 60 days).
269
36 AMOUNTS DUE TO JOINTLY CONTROLLED ENTITIES
25 STERLING YEARS
Amounts due to jointly controlled entities arose from normal trade transactions and are due between 30 to
60 days (2009: 30 to 60 days).
The currency exposure profile of the amounts due to jointly controlled entities is as follows:

Pound US Ringgit
Sterling Dollar Malaysia Total
RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia - - 22,934 22,934

Pound Sterling 323 - - 323
Australian Dollar - 127 - 127
Indonesia Rupiah - 556 - 556
323 683 22,934 23,940

Pound US Ringgit
Sterling Dollar Malaysia Total
RM’000 RM’000 RM’000 RM’000
Group
Functional currency
Ringgit Malaysia - - 14,622 14,622

Pound Sterling 307 - - 307
Australian Dollar - 266 - 266
307 266 14,622 15,195
37 SHORT TERM BORROWINGS

Effective interest rate
during the financial year Group
2010 2009 2010 2009
% % RM’000 RM’000
Per annum Per annum
Unsecured:
270 Long term loan
- current portion (Note 32(a)) - - - 47,879
Bridging loan 5.00 – 6.00 5.00 – 6.00 32,724 36,595
25 STERLING YEARS
Bankers’ acceptance/Bills of exchange 3.50 2.88 – 4.82 2,690 141,317

Revolving credit 2.84 3.50 – 6.00 25,696 30,813
61,110 256,604
Secured:
Long term loan
- current portion (Note 32(b)) 3.50 – 4.50 7.32 19,766 15,668
Revolving credit 1.80 – 4.50 4.00 – 10.00 61,360 33,767
81,126 49,435
142,236 306,039
The revolving credit is secured over a subsidiary company’s fixed and floating assets.

37 SHORT TERM BORROWINGS (continued)
The currency exposure profile of the short term borrowings is as follows:

Ringgit Pound
RM’000 RM’000 RM’000
Group
25 STERLING YEARS
2,690 139,546 142,236

Ringgit Pound
RM’000 RM’000 RM’000
Group
Functional currency

189,196 116,843 306,039
38 SEGMENTAL INFORMATION
The Group is principally engaged in the automobile industry namely, manufacturing, assembling, trading
and provision of engineering and other services in respect of motor vehicles and related products.
Accordingly, no segmental information is considered necessary for analysis by industry segment.
Inter-segment sales comprise sales of motor vehicles, parts and engineering services to Group companies
in different geographical locations.
Analyses of the Group’s revenue, results and other information by geographical locations are as follows:
272 2010
Malaysia
2009 2010
Other countries
2009 2010
Elimination
2009 2010
Total
2009
RM’million RM’million RM’million RM’million RM’million RM’million RM’million RM’million
25 STERLING YEARS
Revenue
External sales 7,020.2 5,721.8 1,206.7 797.0 - - 8,226.9 6,518.8
Inter-segment sales 261.6 121.6 46.0 47.2 (307.6) (168.8) - -
Total revenue 7,281.8 5,843.4 1,252.7 844.2 (307.6) (168.8) 8,226.9 6,518.8
Results
Segment operating profit/(loss) 142.4 (273.0) 90.3 (106.5) 0.7 (3.4) 233.4 (382.9)
Unallocated (expense)/income (7.7) 1.3
Interest expense (12.1) (14.4)
Interest income 28.5 42.0
Share of net results of associated
companies and jointly
controlled entities 10.9 20.3 5.9 5.3 2.0 9.2 18.8 34.8
Taxation (42.0) 17.4
Profit/(loss) after taxation 218.9 (301.8)
Other information
Segment assets 5,992.8 5,703.4 1,078.2 820.5 - - 7,071.0 6,523.9
Unallocated assets 434.2 575.0
Total assets 7,505.2 7,098.9
Segment liabilities 1,054.5 1,287.0 866.5 286.8 - - 1,921.0 1,573.8

Unallocated liabilities 251.2 423.6
Total liabilities 2,172.2 1,997.4
Capital expenditure 365.1 562.4 112.7 138.0 - - 477.8 700.4

Depreciation and amortisation 462.5 473.4 51.8 25.4 - - 514.3 498.8
Assets written off 66.7 34.2 12.9 4.6 - - 79.6 38.8
Impairment:
- property, plant and equipment 6.0 249.2 - 8.5 - - 6.0 257.7
- capitalised development cost - 20.8 - - - - - 20.8
Research and development grant (143.7) (80.7) - - - - (143.7) (80.7)
Allowance for doubtful debts 14.0 45.6 13.2 - - - 27.2 45.6
Write down of inventories 80.1 108.9 - 6.1 - - 80.1 115.0
Reversal of impairment
of investment (2.1) - - - - - (2.1) -
Provision for diminution in
value of investment 10.4 - - - - - 10.4 -
Reversal of impairment
of property, plant and equipment (53.4) - - - - - (53.4) -

38 SEGMENTAL INFORMATION (continued)
Unallocated income includes dividend from other investments, gain/(loss) on disposal of current investments
and write down/(write back) of provision for diminution in value of current investments. Segment assets
consist primarily of property, plant and equipment, intangible assets, inventories, receivables and operating
cash, and excludes investments in associated companies, jointly controlled entities, investments, current
investments, goodwill and taxation. Segment liabilities comprise operating liabilities and exclude items
such as taxation, borrowings and employee retirement benefits.
Capital expenditure mainly comprises additions to property, plant and equipment and intangible assets
(Notes 13 and 16 to the financial statements). 273
Secondary reporting format
25 STERLING YEARS
The primary reporting format is based on geographical locations of the assets. Industry segmentation is
considered unnecessary as the Group is principally engaged in the automobile industry. Therefore, only
sales to external customers based on the location of the customer are presented below:
Malaysia Other countries Elimination Total

2010 2009 2010 2009 2010 2009 2010 2009
RM’million RM’million RM’million RM’million RM’million RM’million RM’million RM’million
Revenue
External sales 6,703.6 5,404.5 1,523.3 1,114.3 - - 8,226.9 6,518.8
Inter-segment sales 261.6 121.6 46.0 47.2 (307.6) (168.8) - -
Total revenue 6,965.2 5,526.1 1,569.3 1,161.5 (307.6) (168.8) 8,226.9 6,518.8
39 CAPITAL AND OTHER COMMITMENTS

Group
2010 2009
RM’000 RM’000
Capital commitments
Capital expenditure for property, plant and equipment and intangible

assets approved by the Board but not provided for in the financial
statements:
Contracted for 345,546 184,745

Not contracted for 2,883,331 2,421,085
40 OPERATING LEASES
As at 31 March 2010, the Group was committed to making the following payments in respect of operating
leases expiring:
Group
Office
Land and Plant and equipment
buildings machinery and vehicles Total
274 RM’000 RM’000 RM’000 RM’000
2010
25 STERLING YEARS
Within one year 23,302 956 1,213 25,471

Between one and five years 49,055 1,280 1,598 51,933
After five years 1,280 12 - 1,292
73,637 2,248 2,811 78,696
Group
Office
Land and Plant and equipment
buildings machinery and vehicles Total
RM’000 RM’000 RM’000 RM’000
2009
Within one year 11,414 965 1,254 13,633

Between one and five years 13,896 2,261 1,231 17,388
After five years 1,353 52 - 1,405
26,663 3,278 2,485 32,426

41 SIGNIFICANT RELATED PARTY TRANSACTIONS DISCLOSURES
In the normal course of business, the Group and Company undertake a variety of transactions at mutually
agreed terms with subsidiary companies, associated companies, jointly controlled entities and other
related parties. The related parties with whom the Group and Company transact with, include the following
companies:
Related parties Relationship
Lotus Group International Limited Subsidiary company

Miyazu (Malaysia) Sdn. Bhd. Associated company 275
PHN Industry Sdn. Bhd. Associated company
Marutech Elastomer Industries Sdn. Bhd. Associated company
25 STERLING YEARS
Exedy (Malaysia) Sdn. Bhd. Associated company
Netstar Advance Systems Sdn. Bhd. Associated company
Proton Finance Limited Associated company
Lotus Finance Limited Jointly controlled entity
Proton Parts Centre Sdn. Bhd. Jointly controlled entity
PEPS-JV (M) Sdn. Bhd. Equity investment
Technomeiji Rubber Industries Sdn. Bhd. Equity investment
Aluminium Alloy Industries Sdn. Bhd. Equity investment
Ara Borgstena Sdn. Bhd. Equity investment
In addition to related party disclosures mentioned elsewhere in the financial statements, set out below are
other significant related party transactions. The related party transactions described below were carried out
on terms and conditions obtainable in transactions with unrelated parties unless otherwise stated.
(a) Interest income from advances to a subsidiary company

Company
2010 2009
RM’000 RM’000
Subsidiary company
- Lotus Group International Limited - 5,680
41 SIGNIFICANT RELATED PARTY TRANSACTIONS DISCLOSURES (continued)
(b) Sales of goods and services

Group
2010 2009
RM’000 RM’000
Jointly controlled entities
- Proton Parts Centre Sdn. Bhd. 20,780 25,566
276 - Lotus Finance Limited* 74,641 45,988
Associated company
25 STERLING YEARS
- Proton Finance Limited* 29,100 30,787
* Under the terms of financing agreements, Lotus Finance Limited and Proton Finance Limited
provide financing services to dealers and customers of the Group to acquire vehicles. Vehicles
under financing arrangements are sold through Lotus Finance Limited and Proton Finance
Limited.
(c) Purchases of goods and services from:

Group
2010 2009
RM’000 RM’000
Associated companies
- PHN Industry Sdn. Bhd. 164,261 123,623
- Marutech Elastomer Industries Sdn. Bhd. 1,365 1,048
- Exedy (Malaysia) Sdn. Bhd. 8,186 8,619
- Netstar Advance Systems Sdn. Bhd. 5,489 6,487
- Miyazu (Malaysia) Sdn. Bhd. 44,057 136,524

- Proton Parts Centre Sdn. Bhd. 133,429 98,179
Equity investment companies

- PEPS-JV (M) Sdn. Bhd. 188,697 191,301
- Technomeiji Rubber Industries Sdn. Bhd. 3,063 3,589
- Aluminium Alloy Industries Sdn. Bhd. 38,706 44,712
- Ara Borgstena Sdn. Bhd. 566 30

41 SIGNIFICANT RELATED PARTY TRANSACTIONS DISCLOSURES (continued)
(d) Interest expense
Group
2010 2009
RM’000 RM’000
Associated company
- Proton Finance Limited 371 694
277
(e) Key management personnel compensation
25 STERLING YEARS
Key management is defined as those persons having authority and responsibility for planning,
directing and controlling the activities of the Group, directly or indirectly, including Executive and
Non-executive Directors. The key management compensation disclosed below excludes the Executive
and Non-executive Directors’ compensation as disclosed in Note 8 to the financial statements:
Group
2010 2009
RM’000 RM’000
Salaries and other short-term employee benefits 15,067 10,822

Defined contribution retirement plan 1,184 1,243
42 CONTINGENT LIABILITIES
Group
2010 2009
RM’000 RM’000
Disputed claims 27,503 14,531
(a) In a prior financial year, a supplier had obtained a judgment in default against a subsidiary company
for RM12.5 million after failing to reach a formal agreement. The subsidiary company had obtained
legal opinion that the claims are without basis and action has been taken to set aside the judgment.
The Directors are of the opinion, based on legal advice, that the claims have no merits and are unlikely
to succeed.
42 CONTINGENT LIABILITIES (continued)

(b) A distributor instituted arbitration proceedings against a subsidiary company as a result of
the termination of its distributorship, for which the distributor had claimed USD9.9 million
(RM32.4 million) plus general damages and interest. The arbitration award was handed down on 30
October 2006 wherein the distributor’s claim against the subsidiary company was dismissed. The
distributor has filed an action in court to set aside the arbitration award. The subsidiary company
has obtained legal advice that it is probable that such an action will not be successful.
(c) A subsidiary company had issued a notice of termination of an associated company on
278 11 July 2006 to the subsidiary company’s joint venture partner (‘Respondent’). The subsidiary
company’s joint venture partner is disputing the termination. The amount claimed cannot be
quantified due to the nature of damages being claimed which can only be ascertained from evidence
25 STERLING YEARS
produced during the arbitration process. According to the Joint Venture Contract (‘JV Contract’),
disputes must be referred to arbitration. The subsidiary company filed the Statement of Case with
the Singapore International Arbitration Centre on 31 January 2008. The Respondent subsequently
produced a Memorandum allegedly signed by the subsidiary company and the Respondent dated the
same date as the JV Contract which allegedly states that the forum for settling of disputes should be
the Chinese courts and not arbitration. The subsidiary company maintains that the Memorandum
is a forgery. The arbitration tribunal stated that it has jurisdiction to hear the matter challenging its
jurisdiction and this will be by way of a full hearing involving witnesses and evidence.
The Respondent had on 11 June 2008 filed an action in China seeking damages for the unlawful
termination of the JV Contract by the subsidiary company. The subsidiary company has accordingly
filed its objection to the action in China on the basis that the Chinese court has no jurisdiction to
hear any matters in relation to the JV. This is supported by the tribunal awards on jurisdiction and
on the valid termination of the JV. The objection is pending examination by the Chinese court.
On 2 February 2010, the arbitration tribunal issued a final award stating that the JV Contract was
validly terminated.
On 24 May 2010, the arbitration tribunal ordered the Respondent to pay the subsidiary company all
its legal and arbitration costs totalling Singapore Dollar 655,056 (RM1,532,045). The subsidiary
company is currently in the midst of enforcing the arbitral award and initiating the winding-up
process in China.
(d) A vendor has commenced arbitration proceedings against two subsidiary companies. The claim
against one subsidiary company amounts to RM19.3 million and against the other subsidiary
company is for RM8.2 million. Both parties are in the midst of exchanging points of claims and
defences which will be followed by the exchange of documents in support of such claims and
defences. The parties are also appointing a new arbitrator in light of the previous arbitrator being
appointed as Judicial Commissioner to the High Court. The Directors are of the opinion, based on
legal advice, that the claims have no merits and are unlikely to succeed.

43 CASH AND CASH EQUIVALENTS
Group Company
2010 2009 2010 2009
RM’000 RM’000 RM’000 RM’000
Short term funds deposited

with licensed banks 1,385,703 717,221 248,119 208,955
Bank and cash balances 266,386 196,629 257 468
Deposits, bank and cash balances
Deposit pledge with financial institution
1,652,089 913,850 248,376 209,423
279
as security for banking facilities (25,468) - - -
25 STERLING YEARS
Bank balance in respect of
ADF liabilities (Note 32(d)) (20,512) (14,467) - -
1,606,109 899,383 248,376 209,423
44 FINANCIAL INSTRUMENTS
(a) Financial risk management objectives and policies
The Group’s activities are exposed to a variety of financial risks, including foreign currency exchange
risk, interest rate risk, market risk, credit risk, liquidity and cash flow risk. The Group focuses on
the unpredictability of financial markets and seeks to minimise potential adverse effects on the
financial performance of the Group. Financial risk management is carried out through risks reviews,
internal control systems, a comprehensive insurance programme and adherence to Group financial
risk management policies. The Board regularly reviews these risks and approves the treasury policies,
which cover the management of these risks.
The Group uses derivative financial instruments such as foreign exchange contracts and interest rate
instruments to hedge certain exposures. It does not trade in financial instruments.
(i) Foreign currency exchange risk
The Group is exposed to currency risk as a result of the foreign currency transactions entered into
by the Company and subsidiary companies in currencies other than their functional currencies.
The Group enters into forward foreign currency exchange contracts to limit the exposure on
foreign currency receivables and payables, and on cash flows arising from anticipated transactions
denominated in foreign currencies.
(ii) Interest rate risk
The Group’s income and operating cash flows are not substantially affected by changes in market
interest rates except for interest from bank deposits. Derivative financial instruments are used,
where appropriate, to generate the desired interest rate profile.
44 FINANCIAL INSTRUMENTS (continued)

(a) Financial risk management objectives and policies (continued)
(iii) Market risk
The Group does not face significant exposure from the risk from changes in debt and equity prices.
(iv) Credit risk
The Group seeks to invest cash assets safely and profitably. The Group considers the risk of
280 material loss in the event of non-performance by a financial institution to be unlikely in view of
the financial strength of those counter-parties.
25 STERLING YEARS
The Group seeks to control customers credit risk by ensuring that significant sales of vehicles and
provision of services are made to customers with an appropriate credit history.
(v) Liquidity and cash flow risk
Prudent liquidity risk management implies maintaining sufficient cash, the availability of funding
through an adequate amount of committed credit facilities and the ability to close out market
positions.
(b) Forward foreign exchange contracts
Forward foreign exchange contracts are entered into by the Group in currencies other than the
functional currency to manage exposure to fluctuations in foreign currency exchange rates on specific
transactions.
As at 31 March 2010, there are no outstanding forward foreign exchange contracts. As at 31 March
2009, the outstanding notional principal amounts of the Group foreign exchange contracts are as
follows:
Group
2010 2009
RM’000 RM’000
Maturity
Less than 6 months - 38,343


(b) Forward foreign exchange contracts (continued)
The foreign currency amounts to be received and the contractual exchange rates of the Group‘s
outstanding contracts are as follows:
Currency Average
to be Currency RM’000 contracted
Hedged item received to be paid equivalent rate
281
2009
25 STERLING YEARS
Group
Forecasted receivables
- the following 6 months JPY RM 1,907 1 RM = JPY 26.705
GBP USD 21,956 1 USD = GBP 1.6567
GBP EURO 14,480 1 EURO = GBP 1.1746
38,343
The net position based on fair values of the outstanding forward foreign exchange contracts was NIL
(2009: unfavorable by RM125,000).

(c) Fair values
The carrying amounts of financial assets and liabilities of the Group and Company at the balance
sheet date approximated their fair values except as set out below:
Group Company
Carrying Carrying
Note amount Fair value amount Fair value
282 RM’000 RM’000 RM’000 RM’000
2010
25 STERLING YEARS
Recognised on the balance sheet
Amounts due from

subsidiary companies 20 - - 232,946 205,420
- quoted 27 584 654 - -
- unquoted 27 9,092 9,092 - -
Non-current assets held for sale:
- investments 29 2,100 13,825 2,100 13,825
Long term loan 32(b) (29,649) (28,646) - -
Lease and hire purchase creditor
- long term portion 32(c) (2,565) (2,478) - -
ADF liabilities 32(d) (37,288) (36,027) - -
2009
Recognised on the balance sheet
Amounts due from

subsidiary companies 20 - - 177,870 138,284
Investments - unquoted 21 10,397 17,618 6,475 17,618
- quoted 27 584 724 - -
- unquoted 27 14,729 14,729 - -
Long term loan 32(b) (52,225) (46,053) - -
Lease and hire purchase creditor
- long term portion 32(c) (2,537) (2,256) - -
ADF liabilities 32(d) (21,686) (21,422) - -

45 COMPARATIVES
The following comparative figures have been reclassified to conform with the current year’s presentation:
Group
As previously
reported Reclassification Restated
RM’000 RM’000 RM’000
Revenue 6,486,570 32,184 6,518,754

Cost of sales (6,075,913) (69,415) (6,145,328) 283
Other operating income 197,895 (32,184) 165,711
Distribution costs (187,668) 69,415 (118,253)
25 STERLING YEARS
46 APPROVAL OF FINANCIAL STATEMENTS
The financial statements have been approved for issue in accordance with a resolution of the Board of
Directors on 27 July 2010.
Statement By Directors Pursuant To
Section 169(15) Of The Companies Act, 1965
We, Dato’ Mohd Nadzmi bin Mohd Salleh and Dato’ Syed Zainal Abidin B Syed Mohamed Tahir, two of the
Directors of Proton Holdings Berhad, state that, in the opinion of the Directors, the financial statements set
out on pages 185 to 283 are drawn up so as to give a true and fair view of the state of affairs of the Group and
Company as at 31 March 2010 and of the results and cash flows of the Group and Company for the financial
year ended on that date in accordance with the provisions of the Companies Act, 1965 and MASB Approved
Accounting Standards in Malaysia for Entities Other than Private Entities.
Signed on behalf of the Board of Directors in accordance with their resolution dated 27 July 2010.
284
25 STERLING YEARS
DATO’ MOHD NADZMI BIN MOHD SALLEH DATO’ SYED ZAINAL ABIDIN B SYED
CHAIRMAN MOHAMED TAHIR
MANAGING DIRECTOR
Statutory Declaration Pursuant To

Section 169(16) Of The Companies Act, 1965
I, Azhar bin Othman, the officer primarily responsible for the financial management of Proton Holdings Berhad,
do solemnly and sincerely declare that the financial statements set out on pages 185 to 283 are, in my opinion,
correct and I make this solemn declaration conscientiously believing the same to be true, and by virtue of the
provisions of the Statutory Declarations Act, 1960.
AZHAR BIN OTHMAN
Subscribed and solemnly declared by the abovenamed Azhar bin Othman at Shah Alam in Malaysia on 27 July
2010, before me.
COMMISSIONER FOR OATHS

Independent Auditors’ Report To The Members Of
Proton Holdings Berhad
(Incorporated in Malaysia) (Company No. 623177-A)

We have audited the financial statements of Proton Holdings Berhad, which comprise the balance sheets as
at 31 March 2010 of the Group and Company, and the income statements, statements of changes in equity
and cash flow statements of the Group and Company for the year then ended, and a summary of significant
accounting policies and other explanatory notes, as set out on pages 185 to 283.
Directors’ Responsibility for the Financial Statements
The Directors of the Company are responsible for the preparation and fair presentation of these financial
statements in accordance with MASB Approved Accounting Standards in Malaysia for Entities Other than
Private Entities and the Companies Act, 1965. This responsibility includes: designing, implementing and
maintaining internal control relevant to the preparation and fair presentation of financial statements that are
free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting
285
policies; and making accounting estimates that are reasonable in the circumstances.
25 STERLING YEARS
Auditors’ Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with approved standards on auditing in Malaysia. Those standards require that we comply
with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial
statements are free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on our judgment, including the assessment of risks
of material misstatement of the financial statements, whether due to fraud or error. In making those risk
assessments, we consider internal control relevant to the entity’s preparation and fair presentation of the
financial 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 entity’s internal control. An audit also includes
evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates
made by the Directors, as well as evaluating the overall presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
audit opinion.
Opinion
In our opinion, the financial statements have been properly drawn up in accordance with MASB Approved
Accounting Standards in Malaysia for Entities Other than Private Entities and the Companies Act, 1965 so as
to give a true and fair view of the financial position of the Group and Company as of 31 March 2010 and of
their financial performance and cash flows for the year then ended.
Independent Auditors’ Report To The Members Of
Proton Holdings Berhad (continued)
(Incorporated in Malaysia) (Company No. 623177-A)
REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

In accordance with the requirements of the Companies Act, 1965 in Malaysia, we also report the following:
(a) In our opinion, the accounting and other records and the registers required by the Act to be kept by the
Company and its subsidiaries of which we have acted as auditors have been properly kept in accordance
with the provisions of the Act.
(b) We have considered the financial statements and the auditors’ reports of all the subsidiaries of which we
have not acted as auditors, which are indicated in Note 17 to the financial statements.
286 (c) We are satisfied that the financial statements of the subsidiary companies that have been consolidated
with the Company’s financial statements are in form and content appropriate and proper for the purposes
of the preparation of the financial statements of the Group and we have received satisfactory information
25 STERLING YEARS
and explanations required by us for those purposes.
(d) The audit reports on the financial statements of the subsidiary companies did not contain any qualification
or any adverse comment made under Section 174(3) of the Act.
OTHER MATTERS
This report is made solely to the members of the Company, as a body, in accordance with Section 174 of the
Companies Act, 1965 in Malaysia and for no other purpose. We do not assume responsibility to any other
person for the content of this report.
PRICEWATERHOUSECOOPERS THAYAPARAN A/L S. SANGARAPILLAI

(No. AF: 1146) (No. 2085/09/10 (J))
Chartered Accountants Chartered Accountant
Kuala Lumpur
27 July 2010
Shareholding Statistics
as at 30 July 2010

ANALYSIS OF SHAREHOLDINGS
Share Capital
Authorised Share Capital Issued and Fully Paid Up Capital RM1,000,000,000/-

Issued and Fully Paid Up Capital RM549,213,002/-
Class of Shares Ordinary Shares of RM1/- each
Voting Rights One (1) Voting Right for
One (1) Ordinary Share
ANALYSIS OF SHAREHOLDINGS BY RANGE GROUPS

287
No. of %
25 STERLING YEARS
Shareholders/ of Shareholders/ %
Size Of Holdings Depositors Depositors No. of Shares of Shares held
1 - 99 105 1.475 1,483 0.000

100 - 1,000 3,710 52.107 3,447,441 0.628
1,001 - 10,000 2,699 37.907 10,307,866 1.877
10,001 - 100,000 443 6.222 14,242,938 2.593
100,001 - 27,460,649 (*) 160 2.247 184,480,801 33.590
27,460,650 and above (**) 3 0.042 336,732,473 61.312
Total 7,120 100.000 549,213,002 100.000
DISTRIBUTIONS OF SHAREHOLDINGS
No. of % of
Shareholders/ Shareholders/
Depositors Depositors No. of shares % of Shares Held
Size of shareholdings Malaysian Foreign Malaysian Foreign Malaysian Foreign Malaysian Foreign
1 to 99 103 2 1.447 0.028 1,439 44 0.000 0.000

100 to 1,000 3,659 51 51.390 0.716 3,398,741 48,700 0.619 0.009
1,001 to 10,000 2,610 89 36.658 1.250 9,903,066 404,800 1.804 0.073
10,001 to 100,000 364 79 5.112 1.110 11,178,300 3,064,638 2.035 0.558
100,001 to 27,460,649 68 92 0.955 1.292 133,036,227 51,444,574 24.223 9.367
27,460,650 and above 3 0 0.042 0.000 336,732,473 0 61.312 0.000
Total 6,807 313 95.604 4.396 494,250,246 54,962,756 89.993 10.007
as at 30 July 2010 (continued)
SUBSTANTIAL SHAREHOLDERS
No. Name Shareholdings %
1 Khazanah Nasional Berhad 234,734,693 42.740

2 Employees Provident Fund Board 58,877,100 10.720
3 Cartaban Nominees (Tempatan) Sdn. Bhd. 43,120,680 7.851
Petroliam Nasional Berhad (Strategic Inv)
288 THIRTY LARGEST SHAREHOLDERS

No. Name No. of Shares %
25 STERLING YEARS
1 KHAZANAH NASIONAL BERHAD 234,734,693 42.740

2 EMPLOYEES PROVIDENT FUND BOARD 58,877,100 10.720
3 CARTABAN NOMINEES (TEMPATAN) SDN. BHD. 43,120,680 7.851
PETROLIAM NASIONAL BERHAD (STRATEGIC INV)
4 MAYBAN NOMINEES (TEMPATAN) SDN. BHD. 20,493,600 3.731
MAYBAN TRUSTEES BERHAD FOR PUBLIC REGULAR SAVINGS FUND
(N14011940100)
5 LEMBAGA TABUNG HAJI 16,820,427 3.063
6 KUMPULAN WANG PERSARAAN (DIPERBADANKAN) 13,926,800 2.536
7 HSBC NOMINEES (TEMPATAN) SDN. BHD. 10,797,700 1.966
NOMURA ASSET MGMT MALAYSIA FOR EMPLOYEES PROVIDENT FUND
8 HSBC NOMINEES (ASING) SDN. BHD. 8,540,210 1.554
EXEMPT AN FOR THE BANK OF NEW YORK MELLON (MELLON ACCT)
9 AMANAHRAYA TRUSTEES BERHAD 6,766,500 1.232
PUBLIC GROWTH FUND
10 VALUECAP SDN. BHD. 6,035,000 1.098
PUBLIC EQUITY FUND
AS 1MALAYSIA
SKIM AMANAH SAHAM BUMIPUTERA
14 PERMODALAN NASIONAL BERHAD 4,599,900 0.837
PUBLIC SECTOR SELECT FUND
16 CITIGROUP NOMINEES (ASING) SDN. BHD. 3,786,000 0.689
CBNY FOR DIMENSIONAL EMERGING MARKETS VALUE FUND
17 MAYBAN NOMINEES (TEMPATAN) SDN. BHD. 3,453,000 0.628
MAYBAN TRUSTEES BERHAD FOR PUBLIC AGGRESSIVE GROWTH
FUND (N14011940110)
as at 30 July 2010 (continued)

THIRTY LARGEST SHAREHOLDERS (continued)
No. Name No. of Shares %

PUBLIC INDEX FUND
EXEMPT AN FOR JPMORGAN CHASE BANK, NATIONAL ASSOCIATION
(U.S.A.)
20 MAYBAN NOMINEES (TEMPATAN) SDN. BHD. 2,489,000 0.453 289
MAYBAN TRUSTEES BERHAD FOR PUBLIC BALANCED FUND
(N14011950210)
25 STERLING YEARS
TNTC FOR BRANDES INSTITUTIONAL EQUITY TRUST
22 CIMSEC NOMINEES (TEMPATAN) SDN. BHD. 2,358,500 0.429
CIMB BANK BERHAD (ETP)
23 CARTABAN NOMINEES (ASING) SDN. BHD. 2,302,600 0.419
GOVERNMENT OF SINGAPORE INVESTMENT CORPORATION PTE LTD
FOR GOVERNMENT OF SINGAPORE (C)
24 CARTABAN NOMINEES (ASING) SDN. BHD. 2,020,800 0.367
SSBT FUND ITTE FOR COMMONFUND EMERGING MARKETS
INVESTORS COMPANY
25 ALLIANCEGROUP NOMINEES (TEMPATAN) SDN. BHD. 1,488,600 0.271
ALLIANCE INVESTMENT MANAGEMENT BERHAD FOR EMPLOYEES
PROVIDENT FUND
AMANAH SAHAM MALAYSIA
27 EMPLOYEES PROVIDENT FUND BOARD 1,470,000 0.267
28 CITIGROUP NOMINEES (ASING) SDN. BHD. 1,404,700 0.255
CBNY FOR DFA EMERGING MARKETS SMALL CAP SERIES
29 PERTUBUHAN KESELAMATAN SOSIAL 1,385,900 0.252
30 SBB NOMINEES (TEMPATAN) SDN. BHD. 1,226,800 0.223
KUMPULAN WANG PERSARAAN (DIPERBADANKAN)
TOTAL 476,881,410 86.829
DIRECTORS SHAREHOLDINGS
None of the Directors hold any shares in the Company.
Properties Owned by Proton Group
as at 31 March 2010
PROPERTIES OWNED BY PERUSAHAAN OTOMOBIL SDN. BHD. (PONSB)

Date of
Acquisition/ Age of Age of
Location Description Tenure Revaluation Building Building Net Book Value (RM 'Mil)
2009 2010 2009 2010
No. H.S. (D)71311, Land with an area of Freehold 05.09.1983 24 25 Land 68.40 68.40
No. P.T 82 6,231,080 sq. ft. with Years Years Buildings 113.00 100.40
Mukim of Damansara, main office, main factory,
District of Petaling, engine factory, medium
290 Selangor Darul Ehsan. volume factory, canteen
buildings, sports facilities,
car park for production
cars and additional R&D
25 STERLING YEARS
laboratories building.
Total built -up area
is 2,594,603 sq
HICOM Industrial 3 units of flats Freehold 09.04.1986 24 25 Flats 0.041 0.041

Estate encompassing currently rented out. Years Years
Lot 572,
Mukim of Damansara,
District of Petaling,
Selangor Darul Ehsan.
No. H.S.(D) 71309, Land having an area of Freehold 19.11.1993 - - Land 2.50 2.50
No. P.T. 80, 158,107 sq. ft. used
Mukim of Damansara, as the car park for staff.
District of Petaling,
Geran 215214, Land with an area of Freehold 30.12.1992 15 16 Land 21.20 21.20
Lot 61812 Bandar 1,027,339 sq. ft. with Years Years Buildings 36.80 33.70
Glenmarie, District office, factory and
of Petaling, Selangor canteen buildings and
Darul Ehsan sports facilities used
for the Casting Plant.
HSD 86554, PT 257, Land with an area Freehold 18.04.1994 15 16 Land 54.90 54.90
Mukim of Damansara, of 2,396,727 sq. ft. Years Years Track & 13.00 6.90
District of Petaling, adjoining the Company's Buildings
Selangor Darul Ehsan. northern boundary housing
the semi-high speed test
track and control building.
Size of Test Track
is 2,102,731 sq. ft.
No. H.S. (D) B.P.5653 Land with an area of Freehold 03.02.1999 6 7 Land 1.00 1.00
and 5654 Bil P.T. 55,444,116 sq. ft, Years Years Building 436.10 417.90
16162 and 10163, for the construction of
District of Batang a second automobile
Padang, Mukim of plant,administrative
Ulu Bernam Timur, building ans sports
Perak Darul Riduan. complex facilities.
Total built-up area
is 3,374,577 sq.ft.
as at 31 March 2010 (continued)

PROPERTIES OWNED BY PROTON EDAR SDN. BHD. (PESB)
Date of
2009 2010 2009 2010
Vehicel Preparation Vehicle Preparation Freehold 01.12.2000 7 Years 8 Years Building 4.20 3.90
Centre (VPC) Centre and stock control
No H.S. (D) 86555, building with a land
PT No. 258 and area of 315,553 sq. ft.
H.S. (D) 86557,
PT No.260, TP 5
(total built-up area
is 101,956 sq. ft.)
291
Road, Sime UEP
Industrial Park,
25 STERLING YEARS
47600 Subang Jaya,
Centre of Excellence Administration & Freehold 01.03.2001 8 Years 9 Years Land 35.70 35.70
(COE) & Pre-Delivery Operation Office and Building 120.60 113.90
and Inspection Pre-Delivery & Inspection
Centre (PDI) Centre with total land
No H.S. (D) 86596, area of 465,184 sq. ft.
PT No. 299 and
H.S. (D) 86597,
PT No. 300, TP 5
Road, Sime UEP
Industrial Park,
47600 Subang Jaya
No. 2, Lrg. Samarinda Three (3) storey corner Freehold 10.05.2002 6 Years 7 Years Building 0.58 0.55
6A Off Jalan Kebun terraced shopoffice
H.S (D) 60042, unit with a land area
P.T.No. 64566 of approximately
Mukim Klang Selangor 2,476 sq. ft.
Lot 859, Block 16 Land with an area of Freehold 12.07.2002 7 Years 8 Years Land 2.80 2.80
Kuching Central 50,570 sq. ft. used for 27.11.2007 1 Year 2 Years Building 6.90 6.70
Land District, sales outlet and service
Stampin 41/2 Mile, centre with a built-up
Penrissen Road area of approximately
Kuching, Sarawak 37,049 sq. ft.
No. 218089. Land with an area of Freehold 29.04.2002 7 Years 8 Years Land 8.10 8.10
Mukim Plentong, 87,120 sq. ft. to be Building 6.10 5.80
Daerah Johor Bahru, used for sales outlet
Johor and service centre
PROPERTIES OWNED BY PROTON EDAR SDN. BHD. (PESB)

Date of
2009 2010 2009 2010
H.S(D) 63313, Land with an area of Freehold 19.07.2002 6½ Years 7½ Years Land 3.10 3.10
P.T.No. 9671 Mukim 79,949 sq.ft. used for 29.09.2003 4 Years 5 Years Building 2.50 2.40
of Ampangan District sales outlet and service
of Seremban, Negeri centre is 7,175 sq.ft.
292 Sembilan
HSD 318392, Land with an area of Freehold 06.08.2002 6½ Years 7½ Years Land 5.10 5.10
PTD 81816, Mukim 57,267 sq.ft. to be used
25 STERLING YEARS
of Pulai, District of for sales outlet and

Johor Bahru, service centre
Johor Darul Takzim
Lot PT 4352, Land with an area of Freehold 13.09.2002 6½ Years 7½ Years Land 1.40 1.40
Mukim Kuah District 51,979 sq. ft. to be used
of Langkawi Kedah for sales outlet and
service centre
Geran 111857, Land with an area of Freehold 02.09.2002 6½ Years 7½ Years Land 9.60 9.60
Lot 67320, 61,524 sq. ft. to be used 01.03.2004 4 Years 5 Years Building 5.90 5.50
Mukim of Sungai for sales outlet and
Buloh, District of service centre
Petaling, Selangor
Darul Ehsan.
No H.S. (D) 86596, Land with an area of Freehold 05.12.2005 3¼ Years 4¼ Years Land 5.80 5.80
PT No. 302, 123,853 sq. ft. to be
TP 5 Road, Sime used for stockyard area
UEP Industrial Park,
47600 Subang Jaya,
Selangor Darul Ehsan
L&D Tanjung Malim, Administration & Freehold 31.07.2007 1 Year 2 Years Building 4.70 4.40
Proton Edar Sdn. Bhd., Operation Office
c/o Proton Tanjung
Malim Sdn. Bhd.,
Proton City, 35900,
Tanjung Malim, Perak.

PROPERTY OWNED BY PROTON CARS (UK) LTD (PCUK)
Date of
2009 2010 2009 2010
Ref. AV 915, Units Land with an area of Freehold 31.03.1994 32 Years 33 Years Land 5.30 5.01
1-3, Crowley Way, 162,479 sq. ft. with a Building 1.61 1.49
Avonmouth, parts warehouse building
Bristol Avon BS11
9YR, England 293
PROPERTIES OWNED BY LOTUS CARS LTD.
25 STERLING YEARS
Date of
2009 2010 2009 2010
Land adjacent to Two parcels of land with Freehold 26.09.1968 41 Years 42 Years Land 5.15 4.87
Potash Lane, Hethel, a total area of 6,286,550 Building 58.96 52.07
Norwich, Norfolk NR sq. ft. with the factory,
14 8EZ, England and engineering facilities,
Land north of Browic offices and test track of
Lotus Group International
Ltd. Total built up area
is 515,500 sq. ft.
Potash Lane, Hethel, R&D building rented Freehold 01.03.2000 9 Years 10 Years Building 9.73 8.89
Norwich, Norfolk to group companies.
NR14 8EZ, England. Total built up area is
86,600 sq.ft.
PROPERTY OWNED BY LOTUS HOLDINGS INC

Date of
2009 2010 2009 2010
1254 North Main Land with an area of Freehold 24.02.2000 Office: Office: Land 0.66 0.82
St, Ann Arbor, approximately 165,528 89 Years 90 Years Building 6.72 5.84
Michigan USA sq. ft. with office and Workshop: Workshop:
workshop. Total built up 43 Years 44 Years
area is 73,000 sq. ft.
PROPERTIES OWNED BY PT PROTON CIKARANG INDONESIA (PCI)

Date of
2009 2010 2009 2010
Hak Guna Bangunan Combined land area Leasehold 21/09/2004 13 Years 14 Years Lands 22.7 23.2
No. 353, of 136,610 sq. meters (Expiry: Building 9.9 11.6
Desa Sukaresmi, were erected with 24/09/
Kecamatan factories, office, canteen, 2025)
294 Lemahabang,
Kabupaten Bekasi,
warehouse, utility &
security facilities
West Java, Indonesia
25 STERLING YEARS
Hak Guna Bangunan Leasehold

No. 596, (Expiry:
Desa Sukaresmi, 24/09/
Kecamatan 2021)
Lemahabang,
Kabupaten Bekasi,
Hak Guna Bangunan Leasehold

No. 597, (Expiry:
Desa Sukaresmi, 19/06/
Kecamatan 2023)
Lemahabang,
Kabupaten Bekasi,
Share Price and Volume Traded

Share Volume 295
Price (RM)
50,000
25 STERLING YEARS
45,000
40,000
6
35,000
5 30,000
4 25,000
20,000
3
15,000
2
10,000
1 5,000
0 0
Apr 09 May Jun Jul Aug Sep Oct Nov Dec Jan 10 Feb Mar
Share Price Volume

Notice of Annual General Meeting
NOTICE IS HEREBY GIVEN THAT THE SEVENTH (7TH) ANNUAL GENERAL

MEETING OF THE COMPANY WILL BE HELD AT THE AUDITORIUM,
PROTON CENTRE OF EXCELLENCE, KM 33.8, WESTBOUND SHAH
ALAM EXPRESSWAY, 47600 SUBANG JAYA, SELANGOR DARUL EHSAN,
MALAYSIA ON THURSDAY, 23 SEPTEMBER 2010 AT 10.00 A.M. FOR THE
FOLLOWING PURPOSES:
296
1. To lay the Reports of the Directors and Auditors and the
Audited Statement of Accounts for the year ended
25 STERLING YEARS
31 March 2010;
2. To elect the following Directors who retire in accordance
with the Company’s Articles of Association:-
Ordinary Resolution 1 Explanatory Note:
Article 104 states that in every Annual General
To re-elect Dato’ Zalekha Binti Hassan who shall retire in Meeting, at least one third of the Directors for the time
accordance with Article 104 of the Company’s Articles being shall retire from office. The retiring Directors
shall be eligible to seek re-election.
of Association and being eligible, offers herself for
re-election.
Ordinary Resolution 2 Explanatory Note for Resolutions 2 to 4:
Article 111 states that any Director(s) appointed, either
To re-elect Mr Behara Venkata Rama Subbu who shall to fill a casual vacancy or as an addition to the existing
retire in accordance with Article 111 of the Company’s Directors shall hold office only until the following
Annual General Meeting. The retiring Directors shall
Articles of Association and being eligible, offers himself be eligible to seek re-election.
for re-election.
Ordinary Resolution 3
To re-elect Tan Sri Rainer Althoff who shall retire in
accordance with Article 111 of the Company’s Articles
of Association and being eligible, offers himself for
re-election.
Ordinary Resolution 4
To re-elect Encik Abdul Rahim Bin Abdul Hamid who shall
retire in accordance with Article 111 of the Company’s
Articles of Association and being eligible, offers himself
for re-election.
3. Ordinary Resolution 5 Explanatory Note:
In accordance with Article 112 of the Company’s
To approve the payment of Directors’ Fees for the financial Articles of Association, the Board is recommending
year ended 31 March 2010. that the shareholders approve the payment of Directors
fees for the financial year ended 31 March 2010 as
disclosed in Page 153 of the Annual Report 2010
Notice of Annual General Meeting (continued)

Ordinary Resolution 6 Explanatory Note:
In accordance with Article 157 of the Company’s
To declare and approve the payment of a first and final Articles of Association, the Board is recommending
dividend of 20 sen per share less 25% income tax in that the shareholders approve the payment of a first
and final dividend of 20 sen per share less 25%
respect of the financial year ended 31 March 2010 as income tax.
recommended by the Directors.
4. Ordinary Resolution 7 Explanatory Note:
Pursuant to Section 172 (2) of the Companies Act,
To re-appoint Messrs PricewaterhouseCoopers as Auditors 1965, shareholders shall approve the re-appointment
of the Company for the ensuing year and to authorise the of Auditors who shall hold office until the conclusion of
Directors to fix their remuneration. the next Annual General Meeting, and further, authorise
the Directors to determine their remuneration thereof. 297
The present Auditors, Messrs PricewaterhouseCoopers
have indicated their willingness to continue to hold
25 STERLING YEARS
office for the ensuing year.
5. To transact any other ordinary business for which due Explanatory Note:
In accordance with Section 151 of the Companies Act,
notice has been given in accordance with Section 151 of 1965, a company shall on the requisition in writing of
the Companies Act, 1965. such number of members and at the expense of the
requisitionists give to the members of the company
entitled to receive notice of the next Annual General
Meeting, notice of any resolution which may be properly
moved and is intended to be moved at that meeting.
NOTICE OF BOOKS CLOSURE AND DIVIDEND PAYMENT

NOTICE IS HEREBY GIVEN THAT the first and final dividend of 20 sen per share less 25% income tax in
respect of the financial year ended 31 March 2010, if approved at the Seventh (7th) Annual General Meeting
will be paid on 22 October 2010 to shareholders whose names appear in the Register of Members and/or the
Record of Depositors on 30 September 2010.
A Depositor shall qualify for entitlement to the first and final dividend only in respect of:-
(a) Shares transferred into the Depositors’ Securities Account before 4.00p.m. on 30 September 2010 in
respect of transfer;
(b) Shares bought on Bursa Malaysia Securities Berhad on a cum entitlement basis according to the Rules of
Bursa Malaysia Securities Berhad.
By Order of the Board
MOHD NIZAMUDDIN BIN MOKHTAR (LS NO. 006128)

Company Secretary
Shah Alam
30 August 2010
Notice of Annual General Meeting (continued)
NOTES:
1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint one or more proxies to
attend and vote in his stead. A proxy may but need not be a member of the Company and the provision of Section
149(1)(b) of the Companies Act, 1965 shall not apply.
2. The instrument appointing a proxy must be in writing under the hands of the appointer or his attorney duly authorised
in writing or, if such appointer is a corporation, under its common seal or that of an officer or attorney duly authorised.
If the Form of Proxy is signed under the hand of an officer duly authorised, it should be accompanied by a statement
reading “signed as authorised officer under Authorisation Document which is still in force, no notice of revocation
having been received”. If the Form of Proxy is signed under the attorney duly authorised, it should be accompanied
298 by a statement reading “signed under Power of Attorney which is still in force, no notice of revocation having been
received”. A copy of the Authorisation Document or the Power of Attorney, which should be valid in accordance with
the laws of the jurisdiction in which it was created and is exercised, should be enclosed.
25 STERLING YEARS
3. The maximum number of proxies that may be appointed is two. Where a member appoints more than one proxy, the
appointment shall be invalid unless he specifies the proportion of his shareholdings to be represented by each proxy.
4. Where a member of the Company is an authorised nominee as defined under the Securities Industry (Central
Depositories) Act 1991, it may appoint at least one proxy in respect of each securities account it holds with ordinary
shares of the Company standing to the credit of the said securities account.
Every appointment submitted by an authorised nominee as defined under the Securities Industry (Central Depositories)
Act, 1991, must specify the CDS Account Number.
5. The instrument appointing the proxy must be deposited at the office of the Registrar, Tricor Investor Services Sdn.
Bhd. (formerly known as Tenaga Koperat Sdn. Bhd.), Level 17, The Gardens North Tower, Mid Valley City, Lingkaran
Syed Putra, 59200 Kuala Lumpur not less than forty eight (48) hours before the time appointed for the meeting.
6. For the purpose of determining a member who shall be entitled to attend the Meeting, the Company shall be requesting
Bursa Malaysia Depository Sdn. Bhd., in accordance with Article 67(b) of the Company’s Articles of Association
and Section 34(1) of the Securities Industry (Central Depositories) Act, 1991 to issue a General Meeting Record
of Depositors as at 15 September 2010. Only a depositor whose name appears on the General Meeting Record of
Depositors as at 15 September 2010 shall be entitled to attend the said meeting or appoint proxies to attend and/or
vote in his stead.
Statement Accompanying
The Notice of Seventh (7th) Annual General Meeting

PURSUANT TO PARAGRAPH 8.27(2) OF THE MAIN MARKET LISTING
REQUIREMENTS OF BURSA MALAYSIA SECURITIES BERHAD, APPENDED
HEREUNDER ARE:
299
DIRECTORS STANDING FOR RE-ELECTION
25 STERLING YEARS
Directors who are standing for re-election at the Seventh (7th.) Annual General Meeting of the Company which
will be held at The Auditorium, PROTON Centre of Excellence, KM33.8, Westbound Shah Alam Expressway,
47600 Subang Jaya,Selangor Darul Ehsan, Malaysia, on Thursday, 23 September 2010 at 10.00 a.m. pursuant
to the Company’s Articles of association are:
Article 4
i. Dato’ Zalekha Binti Hassan Refer to page 30 of the Annual Report
Article 111
i. Mr. Behara Venkata Rama Subbu Refer to page 31 of the Annual Report
ii. Tan Sri Rainer Althoff Refer to page 32 of the Annual Report
iii. Encik Abdul Rahim Bin Abdul Hamid Refer to page 33 of the Annual Report
This page is intentionally left blank.
PROTON ANNUAL REPORT 2010 Form of Proxy
PROTON Holdings Berhad (623177-A)
No. of Shares Held
CDS Account No. of
Authorised Nominee
I/We (name of shareholder, in capital letters)

NRIC No. (new) (old) ID No./Company No.
of (full address)
being a member of PROTON Holdings Berhad, hereby appoint
(name of proxy as per NRIC, in capital letters) NRIC No. (new) (old)
or failing him/her,
(name of proxy as per NRIC, in capital letters) NRIC No. (new) (old)
or failing him/her, the CHAIRMAN OF THE MEETING as my/our proxy to vote for me/our behalf at the Seventh (7th) Annual
General Meeting of the Company to be held at The Auditorium, Level 1 PROTON Centre of Excellence, KM33.8, Westbound
Shah Alam Expressway, 47600 Subang Jaya, Selangor Darul Ehsan, Malaysia at 10.00 a.m. on Thursday, 23 September
2010 or at any adjournement thereof.
My/Our proxy/proxies is/are to vote as indicated below:
ORDINARY RESOLUTIONS FOR AGAINST

Re-election of Dato’ Zalekha Binti Hassan pursuant to Article 104 Ordinary Resolution 1
Re-election of Mr Behara Venata Rama Subbu Pursuant
to Article 111 Ordinary Resolution 2
Re-election of Tan Sri Rainer Althoff Pursuant to Article 111 Ordinary Resolution 3
Re-election of Encik Abdul Rahim Bin Abdul Hamid Pursuant
to Article 111 Ordinary Resolution 4
To approve the payment of Directors’ Fees for the financial Year
ended 31 March 2010 Ordinary Resolution 5
To declare and approve the payment of a First and Final Dividend
of 20 sen per share less 25% income tax for the Financial Year
ended 31 March 2010 Ordinary Resolution 6
To re-appoint Messrs PricewaterhouseCoopers as Auditors Of the
Company and to authorise the Directors to fix their Remuneration Ordinary Resolution 7
To transact any other ordinary business for which due notice
has been given.
(Please indicate with an “X” in the appropriate box against each resolution, how you wish your proxy to vote. If no instruction is given, this form will
be taken to authorise the proxy to vote at his / her discretion)
Dated this day of 2010.

For appointment of more than one proxy, state number
of shares and percentage of shareholdings to be
represented by the proxies:-
No. of Shares Percentage
Proxy 1 %
Signature/Common Seal of Appointer Proxy 2 %
(If the appointor is an attorney or a corporation please see Note 2 below)
Contact No:
NOTES:
1. A member of the Company entitled to attend and vote at the Meeting is entitled to appoint one or more proxies to attend and vote in his
stead. A proxy may but need not be a member of the Company and the provision of Section 149(1)(b) of the Companies Act, 1965 shall
not apply.
2. The instrument appointing a proxy must be in writing under the hands of the appointer or his attorney duly authorised in writing or, if
such appointer is a corporation, under its common seal or that of an officer or attorney duly authorised. If the Form of Proxy is signed
under the hand of an officer duly authorised, it should be accompanied by a statement reading “signed as authorised officer under
Authorisation Document which is still in force, no notice of revocation having been received”. If the Form of Proxy is signed under the
attorney duly authorised, it should be accompanied by a statement reading “signed under Power of Attorney which is still in force, no
notice of revocation having been received”. A copy of the Authorisation Document or the Power of Attorney, which should be valid in
accordance with the laws of the jurisdiction in which it was created and is exercised, should be enclosed.
3. The maximum number of proxies that may be appointed is two. Where a member appoints more than one proxy, the appointment shall
be invalid unless he specifies the proportion of his shareholdings to be represented by each proxy.
4. Where a member of the Company is an authorised nominee as defined under the Securities Industry (Central Depositories) Act 1991, it
may appoint at least one proxy in respect of each securities account it holds with ordinary shares of the Company standing to the credit
of the said securities account.
Every appointment submitted by an authorised nominee as defined under the Securities Industry (Central Depositories) Act, 1991, must
specify the CDS Account Number.
5. The instrument appointing the proxy must be deposited at the office of the Registrar, Tricor Investor Services Sdn. Bhd. (formerly known
as Tenaga Koperat Sdn. Bhd.), Level 17, The Gardens North Tower, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur not less
than forty eight (48) hours before the time appointed for the meeting.
6. For the purpose of determining a member who shall be entitled to attend the Meeting, the Company shall be requesting Bursa Malaysia
Depository Sdn. Bhd., in accordance with Article 67(b) of the Company’s Articles of Association and Section 34(1) of the Securities
Industry (Central Depositories) Act, 1991 to issue a General Meeting Record of Depositors as at 15 September 2010. Only a depositor
whose name appears on the General Meeting Record of Depositors as at 15 September 2010 shall be entitled to attend the said meeting
or appoint proxies to attend and/or vote in his stead.
Fold Here
Fold Here
AFFIX
STAMP
THE SHARE REGISTRAR OF
PROTON HOLDINGS BERHAD (Company No.623177-A)
Tricor Investor Services Sdn. Bhd.

(formerly known as Tenaga Koperat Sdn. Bhd.)
Level 17, The Gardens, North Tower,
Mid Valley City, Lingkaran Syed Putra,
59200 Kuala Lumpur, Malaysia
Fold Here

Proton Annual Report 2010

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PROTON 2010 ANNUAL REPORT

CONTENTS PROTON ANNUAL REPOR

02 Corporate Mantra & Core Values

09 Key Financial Indicators

10 Summary of Financial Highlights

24 Board of Directors 166 Risk Management

26 Profile of Directors 170 Calendar of Events 2009 – 2010

34 PROTON Group Management 180 Statutory Financial Statements

140 Statement on Corporate Governance 299 Statement Accompanying the

THE PROTON WAY

PROTON EMPLOYEES ARE DEDICATED TO THE GROUP’S

OTHER AND THE CUSTOMERS. THESE VALUES FORM THE

PROTON 2010 Annual Report

Customer Focus Speed

OPERATIONS. IN ACHIEVING our employees;

OUR GOAL, IT IS NECESSARY TO • Provide the appropriate resources;

Environment, health and safety are our priority.

PROTON 2010 Annual Report

We are a global automotive player.

A New Dawn in Expertise

1st QUARTER 2nd QUARTER

FEB MAY JUL JUL

AUG SEP SEP OCT

PROTON 2010 Annual Report

Dividend Paid Retained Earnings

54.9 27.5 - 20.6 - 4,908.7 4,291.7 4,476.2 4,153.9 4,372.8

BALANCE SHEETS AS AT 31 MARCH

RM’ million 2010 2009 2008 2007 2006

Property, plant and equipment 2,624.4 2,827.1 3,150.4 3,169.5 3,302.9

Prepaid land lease payments - - 24.1 9.9 10.0

Inventories 1,227.2 1,395.1 1,100.3 1,273.6 1,389.0

PROTON 2010 Annual Report

CAPITAL AND RESERVES

Long term liabilities 88.6 101.5 230.5 181.6 100.3

Payables 2,060.6 1,877.3 1,637.6 1,531.6 2,324.2

RM’ million 2010 2009 2008 2007 2006

Profit/(loss) before taxation 260.9 (319.2) 144.3 (618.1) 18.0

Basic earnings/(loss) (sen) 39.9 (54.9) 33.6 (107.3) 8 .5

PROTON 2010 Annual Report

• To spearhead the automotive industrialisation process and manufacturing industries;

PROTON’s main business activities encompass vehicle engineering,

domestically and regionally.

In 2009, PROTON clinched two awards by Frost & Sullivan:

PROTON 2010 Annual Report

Dato’ Haji Syed Zainal Abidin B Syed Mohamed Tahir

Dato’ Michael Lim Heen Peok

Dato’ Zalekha Binti Hassan

Mr. Behara Venkata Rama Subbu

Tan Sri Rainer Althoff

Tuan Haji Abdul Jabbar Bin Abdul Majid

Tuan Haji Abdul Kadir Bin Md Kassim

Mr. Oh Kim Sun

PROTON 2010 Annual Report

REGISTERED OFFICE STOCK EXCHANGE LISTING

PROTON ANNUAL REPORT 2010

20 Manufacturing Engineering Services

Nasional Sdn. Bhd. Sdn. Bhd.

PROTON 2010 Annual Report

50% Proton Commerce Sdn. Bhd.

We are highly customer oriented.

A New Dawn in Service

Standing (left to right)

Standing (left to right)