DiGi.Com Berhad

DiGi Telecommunications Sdn Bhd 201283-M T (603) 5721 1800Lot 30 Jalan Delima 1/3 F (603) 5721 1857Subang Hi-Tech Industrial Park E [email protected] Shah AlamSelangor Darul Ehsan, Malaysia

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DiGi.Com Berhad (425190-X)

ANNUAL REPORT 2003 LAPORAN TAHUNAN

Perak

Ipoh40, Medan IstanaBandar Ipoh Raya30000 Ipoh, Perak

Negeri Sembilan

Seremban301, Taman AST70200 SerembanNegeri Sembilan

Sabah

Kota KinabaluLot 5/G3, Ground & 1st FloorsApi-Api Centre88000 Kota Kinabalu, Sabah

Sarawak

KuchingLot 2087, Block 10Bangunan Kueh Boon TeckJalan Tun Ahmad Zaidi Adruce93150 Kuching, Sarawak

MiriLot 938, Ground & 1st FloorsJalan Asmara, 98000 MiriSarawak

Sibu13, Ground & 1st FloorsLorong Kampung Datu 396000 Sibu, Sarawak

24-hour DiGi customer service line: 016-221 1800

DiGi.Com Berhad (425190-X)Lot 30, Jalan Delima 1/3Subang Hi-Tech Industrial Park40000 Shah Alam, Selangor

Mailing Address:P. O. Box 755140718 Shah Alam, SelangorTel: 03-5721 1800Fax: 03-5721 1857www.digi.com.my

Penang

Pulau Tikus368-1-02, Jalan Burmah10350 Pulau TikusPulau Pinang

Seberang Jaya8, Ground FloorJalan Todak DuaPusat BandarBandar Seberang Jaya13700 Prai, Pulau Pinang

Bukit Jambul6B-C-D, Jalan Tun Dr.AwangBukit Jambul Shop House11900 Pulau Pinang

Melaka

Melaka523, Taman Melaka Raya75000 Melaka

Johor

Johor Bahru8, Jalan Molek 1/12Taman Molek81100 Johor Bahru, Johor

Jalan Tun Abdul Razak64, Ground FloorJalan Tun Abdul Razak Susur 180000 Johor Bahru, Johor

Batu Pahat18, Jalan KundangTaman Bukit Pasir83100 Batu Pahat, Johor

Corporate Directory

List of Operating Offices

Principal Place ofBusiness/Head Office

Lot 30, Jalan Delima 1/3Subang Hi-Tech Industrial Park40000 Shah Alam, SelangorTel: 03-5721 1800Fax: 03-5721 1857

Central OperatingOffices

Lot 5, Jalan U1/15Hicom Glenmarie Industrial Park40150 Shah Alam, SelangorTel: 03-5721 1800Fax: 03-5721 1857

Lots 7 & 8, Jalan Delima 1/1Subang Hi-Tech Industrial Park40000 Shah Alam, SelangorTel: 03-5721 1800Fax: 03-5721 1857


Regional OperatingOffices

Northern Region

62, 1st Floor, Jalan MayangPasir 1Off Jalan Mahsuri11950 Bayan Baru Pulau PinangTel: 04-641 2800Fax: 04-641 3800

Southern Region

8, Jalan Molek 1/12Taman Molek81100 Johor Bahru, JohorTel: 07-351 1800Fax: 07-352 8016

Eastern Region

3, Jalan Tun Ismail25000 Kuantan, PahangTel: 09-508 0071Fax: 09-508 0070

Sabah Region

Lot 36, SEDCO Light Industrial EstateJalan Kolombong88450 InanamKota Kinabalu, SabahTel: 088-431 800Fax: 088-430 016

Sarawak Region

Lot 2087, Block 10, Bangunan Kueh Boon TeckJalan Tun Ahmad Zaidi Adruce93150 Kuching, SarawakTel: 082-421 800Fax: 082-427 597

DiGi Centres

Selangor

USJSubang Taipan, 19 & 21Jalan USJ 10/1A, Subang Jaya47610 Petaling Jaya, Selangor

SS224, Jalan SS2/6647300 Petaling Jaya, Selangor

Selayang Baru57, Jalan 2/3A, Pasar Borong SelayangOff Jalan Ipoh68100 Batu Caves, Selangor

Klang90, Batu 1-1/2, Jalan Meru41050 Klang, Selangor

Kuala Lumpur

Pandan IndahM5A/13, Jalan Pandan Indah 4/1Taman Pandan Indah55100 Kuala Lumpur

KL PlazaLot G33-8, Ground Floor,179, KL PlazaJalan Bukit Bintang55100 Kuala Lumpur

Berjaya Times Square01-36, Berjaya Times Square, 1, Jalan Imbi ,55100 Kuala Lumpur

Pahang

Kuantan3, Jalan Tun Ismail25000 Kuantan, Pahang

D i G i . C o m B e r h a d ( 4 2 5 1 9 0 - X ) 1

Aspirat ion Statement and Key Pr inc ip les

Corporate Mi lestones

Corporate Informat ion

Directors ’ Prof i les

Statement on Corporate Governance

Statement on Internal Contro l

Other Compl iance Informat ion

Audi t Committee Report

Prof i le of Chief Execut ive Of f icer

Management Group

Group F inanc ia l Summary

Chairman’s Statement

Operat ions Review

Corporate Soc ia l Respons ib i l i ty

F inanc ia l Statements

L ist of Propert ies

Statement of Directors ’ Sharehold ings

Stat is t ics on Sharehold ings

Not ice of Annual Genera l Meet ing

Form of Proxy

Corporate Directory

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Our AspirationTo be the mobile communications leader in creatingexperiences with a difference for our customers andbusiness partners through our passion for success

We have a passion for our customers

We value ideas and encourage initiative

We emphasise mutual trust and respect

We believe in the power of teamwork

We build partnerships for success

Our Key Principles

D i G i . C o m B e r h a d ( 4 2 5 1 9 0 - X ) 3

4 DiGi.Com Berhad (425190-X)

1996 19971995

24 MayFirst telco in Malaysia tolaunch and operate a fullydigital cellular network

28 MayFirst operator to offer DiGiGuarantees, an exclusivecustomer benefitsprogramme

6 OctoberFirst operator in Asia to bepart of the InternationalRoaming Platform (IRP) andto commercially launch theuse of the dual-band mobilephones for use in GSM 900,1800 and 1900 networks byoffering the first GlobalCellular Service (GCS) inMalaysia

18 DecemberFirst telco (then known asMutiara Swisscom Bhd) tobe listed on the KualaLumpur Stock ExchangeMain Board under theInfrastructure ProjectCompanies category

28 MarchFirst GSM 1800 operator tooffer International Roamingfacilities

09 AprilFirst digital cellular networkto be operational in Sabahand Sarawak

03 JuneFirst operator to offerenhanced informationservices, in the form ofinteractive DiGi StockServices with DiGi StockAlert

Corporate Milestones

1998

20 JanuaryThe strategic alliance withTelenor International AS wasformed

18 AprilThe name of DiGi SwisscomBhd, the holding company ofDiGi TelecommunicationsSdn Bhd, was changed toDiGi.Com Berhad

8 MayFirst telco to launch theMobile Phone BankingService in Malaysia usingthe STK platform, incollaboration with UnitedOverseas Bank (Malaysia)Berhad

23 MayFirst telco in Malaysia toalign itself with MTV Asia,the top music channel inAsia, to bring to consumersan interactive and excitingmusic programme thatmarries technology andentertainment

1 FebruaryFirst GSM operator inMalaysia to offer AutomaticInternational Roamingservice to the United Statesof America

9 September First prepaid service providerto introduce the newgeneration prepaid serviceswhich include Quickmailservices, Voicemail andInternational Roaming

18 NovemberFirst telco to launch aninnovative and interactivewebsite in Malaysia as wellas Asia. Known as @DiGi, it is slated to be one of themost interactive websites inthe telecommunicationsmarket

7 DecemberFirst telco to introduce thee-pay system for convenientairtime reloads for customersas e-pay terminals are madeavailable at venues witheasy accessibility

1999 2000

DiGi.Com Berhad (425190-X) 5

1 JanuaryFirst operator in Malaysia tolaunch the highly popularprepaid mobile phoneservice, DiGi Prepaid

18 MayFirst operator to offerinnovative call programmesthat are designed forcustomer usage of mobilephones

20012000

4 SeptemberDiGi TelecommunicationsSdn Bhd entered into anagreement with Yahoo! Asia to jointly create WAP-enabled online services

18 OctoberFirst telco in Malaysia tolaunch a revolutionarymobile service in line withfull deregulation. Known as DiGi Mobile One™, thislatest roll-out promisessubstantial savings for allmobile customers

30 OctoberAn RM800 million contractwas signed with Ericsson(M) Sdn Bhd for theexpansion of DiGi’s existingGSM 1800 network, to boostboth coverage and quality ofservice. The contract alsoincludes the supply andimplementation of GPRStechnology

15 DecemberThe launch of iDiGi, DiGi’snew Internet Dial-up AccessService in the Klang Valley,which ensures faster accessspeeds and reliability

18 DecemberThe unveiling of djuice™,DiGi’s unique mobileInternet portal, with itshighly entertaining,informative and usefulservices for customers who need and want greatermobility

23 AugustDiGi signs agreement withConvenience Shopping SdnBhd, allowing customers toobtain DiGi Prepaid Plus™reloads and purchase chatz™24 hours a day, at all 7-Elevenstores located nationwide

10 SeptemberAn alternative reload methodusing a new interactivemedium, “Star Codes” islaunched by DiGi to enableprepaid credit reload for itsDiGi Prepaid Plus™ customers

14 SeptemberDiGi becomes first majorityforeign-owned service providerin Malaysia with Telenor’sincreased shareholdings inDiGi.Com to 61%

1 OctoberDiGi opens up inter-operatorShort Messaging Service(SMS) with all telcos inMalaysia

Early MarchDiGi reaches its one millionmobile customer mark dueto the combined success ofits innovative prepaid andpostpaid mobile services

16 March DiGi’s first-ever MTV-licensed SIM Card Packageand Reload Coupons waslaunched nationwide today.The DiGi-MTV SIM Pack andDiGi-MTV Reload Couponsare the first of their kind tobe released anywhere in theworld

19 MarchIntroduction of theinnovative DiGi Mobile MovieBooking Service, availableon DiGi’s djuice™ WAP, STKand SMS platforms, whichenables DiGi customers tomake bookings of movietickets at selected GoldenScreen Cinemas, anytimeand anywhere, using theirmobile devices

24 JulyDiGi & GHL Systems launchWhoops!, a prepaid reloadservice that allows prepaidcustomers to reload theirmobile airtime without anyphysical prepaid reloadcoupons or PIN numbers atterminals located nationwide


2002

4 JuneFirst telco in Malaysia tooffer Automatic InternationalRoaming and General PacketRadio Services (GPRS) to its prepaid mobilecustomers nationwide, andsimultaneously launch an exclusive LoyaltyProgramme to reward itsprepaid customers. DiGitoday becomes the firstoperator in the Asian regionto commercially launchGeneral Packet RadioServices (GPRS) on bothprepaid and postpaidplatforms

23 SeptemberDiGi establishes an e-commercemilestone through signing a strategic agreement withMOL AccessPortal Bhd toenable Malaysia’s firstautomatic online reloadservice for DiGi Prepaid Plus™and the purchase of chatz™,its International Calling Card

13 NovemberFirst telco to offer DiGi’sprepaid customers thecountry’s first auto reloadservice via an alliance withCitibank. The service allowsDiGi’s prepaid customers toperform automatic reloadsusing their credit cards

2003

27 MayDiGi signs a strategicagreement with SiemensMalaysia to upgrade itsGSM/GPRS mobile networkto next-generation wirelesstechnology, introducingEnhanced Data Rates forGlobal Evolution (EDGE) in the Klang Valley

Early AugustDiGi hits its two millionthmobile customer mark,through increasing customerrecognition of its innovativemobile communicationsproducts and services

27 AugustDiGi becomes the firstmobile communicationsservice provider to launchMultimedia MessagingService (MMS) for both itsprepaid and postpaid mobilecustomers in Malaysia

22 SeptemberThe launch of Beyond™Prepaid, DiGi’s new prepaidmobile service with itsintelligent automaticadjusting rates feature that automatically reducescall rates as the number of calls increase. Beyond™Prepaid comes with a hostof innovative features which include automaticinternational roaming, MMS,faster internet connectionvia DiGi’s GPRS network,call waiting, call divert andmulti-party conferencing

18 NovemberDiGi launches itsstraightforward and simpleHorizon™ Postpaid service,offering postpaid customersan attractive choice betweenits easy-to understandHorizon Optimum™ andHorizon Premier™ priceplans. Horizon Optimum™utilises DiGi’s popular autoadjusting rates featurewhich allows the rate perminute to be reduced withthe amount of calls the user makes, while HorizonPremier™ allows customers to enjoy a value-for-moneynationwide flat rate


Corporate Information

Board of Directors

Tan Sri Dato’ Seri Vincent Tan Chee Yioun (Chairman)

Arve Johansen (Deputy Chairman)

Tun Dato’ Seri Dr Lim Chong Eu

Ole Bjorn Sjulstad

Per Olav Fosse

Gunnar Johan Bertelsen

Dato’ Ab. Halim Bin Mohyiddin

Chan Kien Sing (Alternate to Tan Sri Dato’ Seri Vincent Tan Chee Yioun)

Thor Asbjorn Halvorsen (Alternate to Arve Johansen and Per Olav Fosse)

Audit Committee

Dato’ Ab. Halim Bin Mohyiddin (Chairman/Independent Non-Executive Director)

Tun Dato’ Seri Dr Lim Chong Eu (Independent Non-Executive Director)

Ole Bjorn Sjulstad (Non-Independent Non-Executive Director)

Secretaries

Su Swee Hong (MAICSA No.0776729)

Gan Swee Peng (MAICSA No.7001222)

Domicile and Country of Incorporation

Malaysia

Registered Office

11th Floor Menara Berjaya

KL Plaza, 179 Jalan Bukit Bintang

55100 Kuala Lumpur

Tel: 03-2935 8888

Fax: 03-2935 8043


Auditors

KPMG

Chartered Accountants

Wisma KPMG

Jalan Dungun

Damansara Heights

50490 Kuala Lumpur

Stock Exchange Listing

Main Board of Malaysia Securities

Exchange Berhad

Stock Short Name

DIGI (6947)

Share Registrars

Berjaya Registration Services Sdn Bhd

Lot C1-C3, Block C, 2nd Floor, KL Plaza

179 Jalan Bukit Bintang

55100 Kuala Lumpur

Tel: 03-2145 0533

Fax: 03-2145 9702

Principal Bankers

Affin Bank Berhad

AmMerchant Bank Berhad

Banca Intesa S.p.A., Hong Kong Branch

Bank of America N.A., Labuan Branch

Bumiputra-Commerce Bank Berhad

Crédit Agricole Indosuez, Labuan Branch

EON Bank Berhad

Fortis Bank S.A/N.V., Singapore

JPMorgan Chase Bank, Labuan Branch

Malayan Banking Berhad

Natexis Banques Populaires, Labuan Branch

Nordea Bank Sweden AB (publ)

OCBC Bank (Malaysia) Berhad

RHB Bank Berhad

Société Générale, Labuan Branch

Svenska Handelsbanken AB (publ), Sweden

The Bank of East Asia, Limited Labuan Branch

The Bank of Nova Scotia Berhad

The Bank of Nova Scotia, Labuan Branch


Directors’ Profiles

He was appointed to the Board on 18 October 1997 and wassubsequently appointed as the Chairman on 12 May 1999.

He is a businessman and entrepreneur with varied interestsin property development, telecommunications, gaming,stockbroking, manufacturing, trading, motor, hospitality andInternet-related businesses, utilities, media and insurancethrough various public and private companies including IntanUtilities Berhad, Berjaya Times Square Sdn Bhd and GoldenArches Restaurant Sdn Bhd, the local franchisee of theMcDonald’s fast food chain of restaurants.

Currently, he is the Chairman and Chief Executive Officer(“CEO”) of Berjaya Group Berhad, CEO of Berjaya Sports TotoBerhad and the Chairman of MOL.com Berhad and NexnewsBerhad. He also holds directorships in Berjaya Vacation ClubBerhad, Bukit Tinggi Resort Berhad, Bukit Kiara Resort Berhad,Berjaya Golf Resort Berhad and KDE Recreation Berhad as well as several other private limited companies including DiGiTelecommunications Sdn Bhd, a 100% owned subsidiary of theCompany.

(Chairman, Non-Independent/Non-Executive)

52 years of age, Malaysian

Tan Sri Dato’ Seri Vincent Tan Chee Yioun


He was appointed to the Board on 20 January 2000 as theDeputy Chairman of the Company. He holds a Master ofScience in Electrical Engineering (Telecommunications)from the Norwegian Institute of Technology in Trondheim,Norway and has taken part in a programme for ManagementDevelopment at the Harvard Business School in Boston, USA.

He has served as Senior Executive Vice President ofTelenor since 1999 and as Chief Executive Officer ofTelenor Mobile Communications AS since January 2000. Hejoined Telenor in 1989 and has held a number of positions,including President and Chief Executive Officer of TelenorInternational AS. Prior to this, he was Executive VicePresident of Elektrisk Bureau Telecom (Ericsson ofNorway), and a Research Engineer at the NorwegianInstitute of Technology (ELAB).

Currently, he is the Chairman and Director of severalcompanies in USA, Thailand, Greece and Norway. He alsosits on the Boards of Telenor Asia Pte Ltd and DiGiTelecommunications Sdn Bhd.

Arve Johansen

(Deputy Chairman, Non-Independent/Non-Executive)

54 years of age, Norwegian


He was appointed to the Board on 1 October 1997. He graduatedwith a Bachelor of Medicine and a Bachelor of Surgery (M.B.Ch.B)from the Edinburgh University,Scotland in 1944. He was theChief Minister of Penang from1969 to 1990 and the Chairman ofPenang Development Corporation.

He was conferred the DarjahUtama Pangkuan Negeri (D.U.P.N.)by the Tuan Yang Terutama (TYT)Governor of Penang; the Seri SetiaMahkota Malaysia (S.S.M.) by theYang Di-Pertuan Agong; the DatukAmar Bintang Kenyalang (DA) bythe TYT Governor of Sarawak; theGrand Cross 2nd Class Award byHis Excellency the President ofGermany; and the Order of theRising Sun, Gold and Silver Starby His Majesty, the EmperorAkihito of Japan.

He is currently the Chairmanof Chin Well Holdings Berhad,Suiwah Corporation Berhad andBerjaya Vacation Club Berhad. Healso sits on the Boards of SouthernSteel Berhad and United OverseasBank (Malaysia) Berhad.

He was appointed to the Board on 4 October 2001. He graduatedin Mechanical Engineering andBusiness Administration fromKongsberg Ingeniørhøgskole,Norway in 1983.

He has a background in offshoreoil business, ICT (Information andCommunications Technology) andtelecommunications.

He joined Telenor Asia PteLtd as Vice President in 2000.Currently, he is the ManagingDirector of Telenor Asia Pte Ltdand serves as a Board member in DiGi Telecommunications SdnBhd, GrameenPhone Ltd andUnited Communications PublicCompany Limited.

Tun Dato’ Seri Dr Lim Chong Eu(Independent/Non-Executive)


Ole Bjorn Sjulstad(Non-Independent/Non-Executive)



He was appointed to the Board on 20 February 2003. He holds a Masters Degree in BusinessAdministration from NorwegianSchool of Management and aBachelor Degree in ElectricalEngineering from Telenor’s Collegeof Engineering in Norway. Heserved as a Sergeant in theNorwegian Army through the yearof 1977, after completing theNorwegian Army’s Officers Schoolin 1976.

He has worked as an engineerin Norway and the United Statesand held top management postsin areas covering satellite, data,marketing and mobile. He hasalso served in board positions in Telenor as well as in othertelecommunications and technologycompanies in the United States,Africa and Europe.

Currently he is Senior VicePresident of Telenor MobileCommunications AS and serves as a director of companies inMalaysia, Thailand and Canada/USA.

Per Olav Fosse(Non-Independent/Non-Executive)


He was appointed to the Board on 18 February 2004. He was anAlternate Director from November2000 to February 2004. Hegraduated with a Diploma inAdvance Management of UniversityCollege Dublin, Ireland. He alsoholds a Masters Degree in BusinessAdministration of University CollegeDublin, Ireland.

Currently, he is the ProjectDirector of Telenor Asia Pte Ltd. He is also a Director of DiGiTelecommunications Sdn Bhd.

Gunnar Johan Bertelsen(Non-Independent/Non-Executive)



He was appointed to the Board on23 November 2001. He holds aBachelor of Economics in Accountingfrom University of Malaya and aMaster in Business Administrationfrom University of Alberta, Canada.

He was a lecturer at UniversityKebangsaan Malaysia from 1973to 1978. He joined Messrs PeatMarwick Mitchell (now known asKPMG) in 1977 and was admittedas a Partner in 1985. Prior to hisretirement on 1 October 2001, hewas the Partner in charge of theAssurance and Financial AdvisoryServices Divisions.

He is currently the VicePresident of the Malaysian Instituteof Certified Public Accountants(MICPA) and Chairman of itsEducation and Training Committee.He is also a council member of theMalaysian Institute of Accountants(MIA) and chairs its ExaminationCommittee. Internationally, he is a member of the EducationCommittee of the InternationalFederation of Accountants (IFAC).

He also sits on the Boards of HeiTech Padu Berhad, Arab-Malaysian Corporation Bhd, UtusanMelayu (Malaysia) Berhad, MCMTechnologies Berhad, KumpulanPerangsang Selangor Berhad, IdrisHydraulic (Malaysia) Bhd, Amway(Malaysia) Holdings Berhad,Idaman Unggul Berhad, KNMGroup Berhad and several privatelimited companies.


Dato’ Ab. Halim Bin Mohyiddin(Independent/Non-Executive)


He was appointed as an AlternateDirector on 27 February 2003. He holds a Master of Science in Electrical Engineering(Telecommunications andComputer Science) from theNorwegian Institute of Technologyin Trondheim, Norway and read a programme for ManagementDevelopment at INSEAD inFontainebleau, France.

He has served in severalExecutive Management positionsin Telenor including Chief ExecutiveOfficer (“CEO”) of Telenor Networksfrom 1995 to 1998 and CEO ofTelenor Business Solutions from1998. Prior to this, he has beenresponsible for sales activities,Product Management andDevelopments and differenttechnical activities both in thefixed and mobile networks.

Currently, he is ExecutiveVice President of Telenor Mobileand Director of several companiesin Norway and internationally. Heis also an Alternate Director inDiGi Telecommunications Sdn Bhd.

Thor Asbjorn Halvorsen(Alternate Director)


Chan Kien Sing(Alternate Director)


He was appointed as an AlternateDirector on 18 October 1997. He isa member of the Malaysian Instituteof Certified Public Accountants(MICPA) and Malaysian Instituteof Accountants (MIA).

Having articled with MessrsPeat Marwick Mitchell (now knownas KPMG) from 1975 to 1981, hesubsequently joined Arab-MalaysianMerchant Bank Berhad (nowknown as AmMerchant BankBerhad) specialising in corporatefinance until 1989 when he joinedBerjaya Group Berhad.

Currently, he is the ChiefExecutive Officer of Berjaya CapitalBerhad, an Executive Director ofBerjaya Group Berhad and BerjayaSports Toto Berhad. He is also aDirector of Matrix InternationalBerhad, Berjaya Vacation ClubBerhad, Berjaya Holdings (HK)Limited and International Lottery& Totalizator Systems Inc., USAand an Alternate Director inNexnews Berhad. He also holdsdirectorships in several otherprivate limited companies in the Berjaya Group of Companies andDiGi Telecommunications Sdn Bhd.

Save as disclosed,none of theDirectors have:-

1. Any familyrelationship withany directorsand/or majorshareholders ofthe Company;

2. Any conflict ofinterest with theCompany; and

3. Any convictionfor offenceswithin the past10 years otherthan trafficoffences.


in giving them the clearest and simplest

way to access our service, in making every

customer interface simple, in making sure

our communication is clear and impactful

In every aspect of our

interaction with our

customers, we find

ways to engage them

and strengthen their

relationship with DiGi...

by offering easy-to-use

products or services,

Statement on Corporate Governance

The Board of Directors (“Board”) fully appreciates the importance of adoptinghigh standards of corporate governance throughout the Group. The Board viewscorporate governance as synonymous with three key concepts, namelytransparency, accountability as well as corporate performance.

As such, the Board strives to adopt the substance behind corporate governanceprescriptions and not merely the form, with the aim of ensuring boardeffectiveness in enhancing shareholder value. The Board is thus fully committedto the maintenance of high standards of corporate governance by supporting andimplementing the prescriptions of the principles and best practices set out in Parts1 and 2 of the Malaysian Code of Corporate Governance (“Code”) respectively.

The following statement sets out how the Company has applied the key principlesand the extent of its compliance with the best practices throughout the financialyear ended 31 December 2003.

A. Board of Directors

Board Responsibilities

The Board of Directors plays a primary role in corporate governance by settingout the strategic direction of the Group, establishing goals, monitoring theachievement of the goals and ensuring a high degree of transparency andaccountability towards all stakeholders. The key responsibilities of the Boardare in tandem with the 6 principal responsibilities specified under BestPractice AAI of the Code.

Meetings

The Board met four (4) times during the financial year ended 31 December 2003.

Details of each existing Director’s meeting attendances are as follows:

Name Attendance

Tan Sri Dato’ Seri Vincent Tan Chee Yioun 3/4Non-Independent/Non-Executive

Arve Johansen 4/4Non-Independent/Non-Executive

Tun Dato’ Seri Dr Lim Chong Eu 4/4Independent/Non-Executive

Ole Bjorn Sjulstad 4/4Non-Independent/Non-Executive

Per Olav Fosse 4/4Non-Independent/Non-Executive

Dato’ Ab. Halim Bin Mohyiddin 4/4Independent/Non-Executive

Sigve Brekke (resigned on 18.2.2004) 2/4Non-Independent/Non-Executive



Two (2) out of the seven (7) Board members are considered independent inaccordance with the definition provided under paragraph 1.01 (Definition andInterpretations) of the Malaysia Securities Exchange Berhad (“MSEB”) ListingRequirements. As such, the Company fulfils the requirement to have at leastone third of the Board composed of Independent Non-Executive Directors.

Tun Dato’ Seri Dr Lim Chong Eu has been identified as the Senior IndependentNon-Executive Director of the Board to whom concerns may be conveyed.

Board Balance

The Board currently has seven (7) members, comprising two (2) IndependentNon-Executive Directors and five (5) Non-Independent Non-Executive Directors.Together, the Directors bring a wide experience relevant to the direction ofthe Group. The Directors combine in them expertise and experience in variousfields such as telecommunications, economics and investment, public servicesand accounting. Their expertise, experience and background result in thoroughexamination and deliberations of the various issues and matters affecting theGroup. A brief description of the background of each Director is presented onpages 10 to 15 of the Annual Report.

There is a clear division of responsibility between the Chairman and the ChiefExecutive Officer/Chief Operating Officer (CEO/COO) to ensure that there is abalance of power and authority. The Chairman is responsible for running theBoard and ensures that all Directors receive sufficient relevant information onfinancial and non-financial matters to enable them to participate actively inBoard decisions. The CEO/COO is responsible for the day to day managementof the business as well as implementation of Board’s policies and decisions.There is also balance in the Board because of the presence of IndependentNon-Executive Directors of the calibre necessary to carry sufficient weight inBoard decisions. Although all the Directors have an equal responsibility forthe Group’s operations, the role of these Independent Directors is particularlyimportant in ensuring that the strategies proposed by the executive managementare fully discussed and examined and take into account the long terminterest, not only of the shareholders, but also of employees, customers,suppliers, community and other stakeholders.

The Board is satisfied that the current Board composition fairly reflects theinvestment of minority shareholders in the Company.

Supply of Information

The Chairman ensures that all Directors have full and timely access toinformation with Board papers distributed in advance of meetings. EveryDirector has also unhindered access to the advice and services of theCompany Secretary and may obtain independent professional advice at theCompany’s expense in furtherance of their duties. Prior to the meetings ofthe Board, Board papers which include reports on group performance andmajor operational, financial, strategic and regulatory matters are circulated to all the Directors. These Board papers are issued at least seven (7) days inadvance to enable the Directors to obtain further explanation, where necessary,in order to be properly briefed before the meeting.

Statement on Corporate Governance20 DiGi.Com Berhad (425190-X)

In addition, there are matters reserved specifically for the Board’s decision,including the approval of corporate plans and budgets, acquisitions and disposalsof assets that are material to the Group, major investments, changes tocontrol structure of the Group, including key policies and authority limits.

Appointments to the Board

The Nomination Committee currently comprises the following members:

Ole Bjorn Sjulstad (Chairman) Non-Independent/Non-ExecutiveTun Dato’ Seri Dr Lim Chong Eu Independent/Non-ExecutiveDato’ Ab. Halim Bin Mohyiddin Independent/Non-Executive

The committee is empowered by its terms of reference to perform thefollowing primary functions:

(a) Recommend new nominations to the Board;(b) Recommend to the Board, Directors to fill the seats on Board Committees;(c) Review annually the required mix of skills and experience and other

qualities including core competencies that the Non-Executive Directorsshould bring to the Board

Directors’ Training

All Directors have attended and completed the Mandatory AccreditationProgramme (MAP) conducted by the Research Institute of InvestmentAnalysts Malaysia (RIIAM), an affiliate company of the Kuala Lumpur StockExchange Berhad. The Directors will continue to undergo other relevanttraining programmes to further enhance their skills and knowledge on acontinuous basis in compliance with Practice Note No. 15/2003 of the MSEBListing Requirements on the Continuing Education Programme.

Re-election

Any Director appointed during the year is required, under the Company’sArticles of Association, to retire and seek election by shareholders at thefollowing annual general meeting. The Articles also require that one-third ofthe Directors retire by rotation each year and seek re-election at the annualgeneral meeting. The Board has also agreed that every Director will submithimself for re-election at least every three years.

Directors over seventy (70) years of age are required to submit themselvesfor re-appointment annually in accordance with Section 129(6) of theCompanies Act, 1965.


B. Directors’ Remuneration

Remuneration Committee

The Remuneration Committee currently comprises the following members:

Arve Johansen (Chairman) Non-Independent/Non-Executive Tan Sri Dato’ Seri Vincent Tan Chee Yioun Non-Independent/Non-ExecutiveOle Bjorn Sjulstad Non-Independent/Non-Executive

Arve Johansen was appointed as the Chairman of the RemunerationCommittee on 18.2.2004 to replace Sigve Brekke who has resigned on thesame date.

The primary functions of the Remuneration Committee is to set up the policyframework and to make recommendations to the Board on all elements of the remuneration package and other terms of employment of the executivedirectors. Non-Executive Directors’ remuneration will be a matter to bedecided by the Board as a whole with the Director concerned abstaining fromdeliberations and voting on decision in respect of his individual remuneration.

Details of the Directors’ Remuneration

The aggregate Directors’ remuneration paid to all Directors of the Companyby the Group and categorised into appropriate components for the financialyear ended 31 December 2003 are as follows:

Allowances Bonus TotalRM’000 RM’000 RM’000

Non-Executive 211 30 241

The number of Directors of the Company whose total remuneration fall withinthe respective band are as follows:

Number of

Non-Executive Directors

RM50,000 and below 2RM50,001 to RM100,000 -RM100,001 to RM150,000 -RM150,001 to RM200,000 1

3

C. Shareholders

Dialogue between Company and Investors

The Company recognises the importance of regular communication withinvestors in the Company, with the annual report and financial statements,regular interim statements being the key media used. Enquiries by shareholdersare dealt with as promptly as practicably possible. Shareholders, investorsand members of the public may also access the Company’s website to obtaininformation on the Company.

The AGM

The key element of the Company’s dialogue with its shareholders is theopportunity to gather views of and answer questions from, both private andinstitutional shareholders on all issues relevant to the Company at the AGM.At the AGM, the shareholders are encouraged to ask questions both aboutthe resolutions being proposed or about the Group’s operations in general.Where it is not possible to provide immediate answers, the Chairman willundertake to furnish the shareholder with a written answer after the AGM.The Chairman of the Board also addresses the shareholders on the review ofthe Group’s operations for the financial year and outlines the prospects of theGroup for the subsequent financial year. The CEO/COO and members ofmanagement are also present at the AGM to clarify and explain any issue.

D. Accountability and Audit

Financial Reporting

DiGi aims to provide a balanced and meaningful assessment of the Group’sfinancial performance and prospects primarily through the annual report,quarterly financial statements and analyst presentations. The Board isassisted by the Audit Committee in overseeing the Group’s financial reportingprocess and the quality of its financial reporting.

Statement on Corporate Governance22 DiGi.Com Berhad (425190-X)


Statement of Directors’ Responsibility in Respect of the Financial Statements

The Directors are required by the Companies Act, 1965 to prepare financialstatements for each financial year/period which have been made out inaccordance with the applicable approved accounting standards in Malaysiaand give a true and fair view of the state of affairs of the Group and of theCompany and of the results and cash flows of the Group and of the Companyfor that year/period. In preparing those financial statements, the Directorsare required to:

• select suitable accounting policies and then apply them consistently;

• state whether applicable accounting standards have been followed, subjectto any material departures disclosed and explained in the financialstatements;

• make judgements and estimates that are reasonable and prudent; and

• prepare the financial statements on the going concern basis unless it isinappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping proper accounting records whichdisclose with reasonable accuracy the financial position of the Group and ofthe Company and to enable them to ensure that the financial statementscomply with the Companies Act, 1965. The Directors are also responsible forsafeguarding the assets of the Group and hence for taking reasonable stepsfor the prevention and detection of fraud and other irregularities.

Internal Control

The Statement on Internal Control set out on pages 24 to 26 of the AnnualReport provides an overview on the state of internal controls within theGroup.

Relationship with the Auditors

Key features underlying the relationship of the Audit Committee with theexternal auditors are included in the Audit Committee’s terms of reference asdetailed on pages 27 to 30 of the Annual Report.

A summary of the activities of the Audit Committee during the year, includingthe evaluation of the independent audit process, are set out on page 27 ofthe Annual Report.

Introduction

The Board of Directors (“Board”) are committed to maintaining a sound systemof internal control in the Group and is pleased to provide the following statement,which outlines the nature and scope of internal control of the Group during thefinancial year.

Board Responsibility

The Board is ultimately responsible for the Group’s system of internal control whichincludes the establishment of an appropriate control environment and frameworkas well as reviewing its adequacy and integrity. The system of internal controlcovers, inter alia, risk management and financial, organizational, operational andcompliance controls. Because of the limitations that are inherent in any systemof internal control, this system is designed to manage, rather than eliminate, therisk of failure to achieve the Group’s objectives. Accordingly, it can only providereasonable but not absolute assurance against material misstatement or loss. Itis possible that internal controls can be circumvented or overridden. Furthermore,because of changing circumstances and conditions, the effectiveness of an internalcontrol system may vary over time.

Key Elements of the System of Internal Control

The following sets out the key elements of the system of internal control of theGroup, which have been in place throughout the financial year and up to thedate of the Directors’ Report.

There is in place a clearly defined organizational structure within the Group withformally defined lines of responsibility and delegation of authority. A process ofhierarchical reporting has been established which provides for a documented trailof accountability.

Significant changes in the business and the external environment are reported tothe Board during the Board meetings. Quarterly financial and other informationare also provided to the Audit Committee and the Board. This oversight reviewenables the Board to control and evaluate the business performance so as toensure that the Group is achieving its corporate objectives. The role of the AuditCommittee in respect of its review of the system of internal controls is describedin the Audit Committee Report included in this annual report.

There is also submission of monthly financial and operational information to theOperating Committee (the composition of which has been approved by the Board)that includes the monthly and year-to-date financial results and comparisons tothe pre-determined key performance indicators. Based on this monitoring ofresults against budget, significant variances are identified and managementaction taken, where necessary.

Statement on Internal Control24 DiGi.Com Berhad (425190-X)

There is an annual budgeting and business plan process where the operatingunits would prepare budgets for the forthcoming financial year and for whichthese are approved by the Operating Committee and the Board. The OperatingCommittee also review quarterly forecasts prepared and submitted by themanagement.

Other control procedures include the establishment of appropriate limits ofauthority for the Board, the Operating Committee and senior management forappropriate approval of transactions. There are established policies on health andsafety, employees training and development, staff performance and evaluation.These procedures are relevant across the Group’s operations and provide forcontinuous assurance to be given to management and, finally to the Board.

Enterprise Risk Management Framework

The Board with the assistance of the internal audit function reviewed the riskmanagement processes of the various operating businesses units with the aim of strengthening the risk management functions across the Group.

The consolidated risk profile of the Group was updated during the financial year.A summary of the key findings was subsequently submitted to the AuditCommittee for consideration.

For the purposes of further enhancing the Group’s risk management process, the following initiatives would be undertaken in 2004:

• A Risk Management Committee, to be headed by the Chief Executive Officer,shall be established with the responsibility of identifying and communicating to the Board via the Audit Committee, the critical risks (present and potential)the Group faces, their changes, and the management action plans to managethe risks.

• A full time dedicated Risk Officer shall coordinate the enterprise riskmanagement within the Group.

• A Risk Management Manual will be issued which outlines the risk managementframework for the Group and offers practical guidance to all employees on riskmanagement issues.

• There will be a requirement to submit quarterly risk management reports tothe Heads of functions for reporting to the Group Risk Management Committee.


Internal Audit Function

The Group has in place an internal audit function, which assists the Board inconducting appropriate reviews to ensure that key controls established by theBoard and management are operating effectively in order for the Board toachieve the objective of ensuring the adequacy and effectiveness of the systemof internal control.

Internal audit reviews the control processes implemented by the management,and reports to the Audit Committee on a quarterly basis. Internal audit adopts arisk-based approach in the review of the internal controls in the key activities ofthe Group’s businesses on the basis of an annual internal audit plan that hadbeen presented to and approved by the Audit Committee.

Weaknesses of Internal Controls that Result in Material Losses

There were no material losses incurred during the current financial year as aresult of weaknesses in internal control. Management continues to takemeasures to strengthen the control environment.

Non-Audit Fees

The amount of non-audit fees paid to external auditors for the financial yearended 31 December 2003 is RM88,600.

Material Contracts

There were no material contracts entered into by the Company and itssubsidiaries which involves directors’ and major shareholders’ interests either stillsubsisting at the end of the financial year ended 31 December 2003 or enteredinto since the end of the previous financial year.

Statement on Internal Control

Other Compliance Information



Audit Committee Report

Composition

Dato’ Ab. Halim Bin MohyiddinChairman/Independent Non-Executive Director

Tun Dato’ Seri Dr. Lim Chong EuMember/Independent Non-Executive Director

Ole Bjorn SjulstadMember/Non-Independent Non-Executive Director

Meetings

The Audit Committee held five meetings during the financial year ended31 December 2003 which were attended by all the members. Representatives ofthe external auditors and other officers of the Group were also invited to attendand brief the members on specific issues during deliberations by the AuditCommittee.

Summary of Activities

The activities undertaken by the Audit Committee during the financial year ended31 December 2003 included the following:

• Reviewed the quarterly unaudited financial results/reports and annual auditedfinancial statements before submission to the Board for consideration andapproval;

• Reviewed the external auditors’ scope of work and audit plans for the year;

• Reviewed and discussed the external auditors’ audit report and areas ofconcern in the management letter thereof, including management’s response;

• Assessed the adequacy and effectiveness of the system of internal control andaccounting control procedures and the weaknesses of the Group’s operatingunits by reviewing the various internal audit reports and managementresponses thereto and ensuring significant findings are adequately addressedby management;

• Reviewed the adequacy and relevance of the scope, functions and resources ofinternal audit and that it has the necessary authority to carry out its work; and

• Reported to the Board on its activities and significant findings and results.

Internal Audit Function

The Group has an established Internal Audit Division which assists the AuditCommittee in the discharge of its duties and responsibilities. The Group’s InternalAudit Division conducted programmed independent reviews and evaluated riskexposures relating to the Group’s governance, operations and informationsystems. The audit reviews also included assessing the means of safeguardingassets; and the economy and efficiency with which resources are employed.

Further details of the activities of the Internal Audit Division are set out in theStatement on Internal Control on pages 24 to 26.

Terms of Reference

1. Membership

The Committee shall be appointed by the Board from amongst the Directorsand shall consist of not less than three members, a majority of whom shall beIndependent Directors and at least one member of the Committee must be amember of the Malaysian Institute of Accountants or such other qualificationsand experience as approved by the Malaysia Securities Exchange Berhad.

A quorum shall consist of two members and a majority of the memberspresent must be Independent Directors.

If a member of the Audit Committee resigns, dies or for any other reasonceases to be a member with the result that the number of members isreduced to below three, the Board of Directors shall, within three months ofthat event, appoint such number of new members as may be required tomake up the minimum number of three members.

2. Chairman

The Chairman of the Committee shall be an Independent Director appointedby the Board. He shall report on each meeting of the Committee to the Board.

3. Secretary

The Company Secretary shall be the Secretary of the Committee and shall beresponsible, in conjunction with the Chairman, for drawing up the agenda andcirculating it, supported by explanatory documentation to the Committeemembers prior to each meeting.

The Secretary shall also be responsible for keeping the minutes of meetings ofthe Audit Committee and circulating them to the Committee members and tothe other members of the Board of Directors.

Audit Committee Report28 DiGi.Com Berhad (425190-X)


4. Frequency of Meetings

Meetings shall be held not less than four times a year and will normally beattended by the Officer charged with the responsibilities of the Group’sfinance and Head of Internal Audit. The presence of external auditors will berequested if required and the external auditors may also request a meeting ifthey consider it necessary.

The Committee may regulate its own procedure in lieu of convening a formalmeeting by means of video or teleconferencing or any other means of audioor audio-visual communications.

5. Authority

The Committee is authorised by the Board to investigate any activity within its terms of reference and shall have unrestricted access to both the internaland external auditors and to all employees of the Group. The Committee isalso authorised by the Board to obtain external legal or other independentprofessional advice as necessary.

The Committee is also authorised to convene meetings with the externalauditors excluding the attendance of the executive members of theCommittee, wherever deemed necessary.

6. Duties

The duties of the Committee shall be :

(a) To consider the appointment of external auditors, the audit fee and any questions of resignation or dismissal including recommending thenomination of person or persons as external auditors;

(b) To discuss with the external auditors where necessary, on the nature andscope of audit and to ensure coordination of audit where more than oneaudit firm is involved;

(c) To review the quarterly results and year-end financial statement prior tothe approval by the Board, focusing on:

• going concern assumption

• compliance with accounting standards and regulatory requirements

• any changes in accounting policies and practices

• significant issues arising from the audit

• major judgemental areas

(d) To prepare Audit Committee Report at the end of each financial year;

(e) To discuss problems and reservations arising from the interim and finalexternal audits, and any matters the external auditors may wish todiscuss (in the absence of management, where necessary);

(f) To review the external auditors’ management letter and management’sresponse;

(g) To review any related party transaction and conflict of interest situationthat may arise within the Company or Group including any transaction,procedure or course of conduct that raises question of managementintegrity;

(h) To do the following in respect of the internal audit function:

• review the adequacy of scope, functions and resources of the internalaudit function and that it has the necessary authority to carry out itswork;

• review internal audit programme;

• ensure coordination of external audit with internal audit;

• consider the major findings of internal audit investigations andmanagement’s response, and ensure that appropriate actions are taken on the recommendations of the internal audit function;

• review any appraisal or assessment of the performance of the staff ofthe internal audit function;

• approve any appointment or termination of senior staff member of theinternal audit function;

• inform itself of resignations of internal audit staff members and providethe resigning staff member an opportunity to submit his/her reason forresignation;

• to monitor related party transactions entered into by the Company andits subsidiaries, and to ensure that the Directors report such transactionsannually to shareholders via the annual report;

• to review and monitor the effectiveness of internal control systems andto evaluate the systems with the external auditors.

(i) To carry out such other responsibilities as may be defined jointly by theAudit Committee and the Board of Directors;

(j) In compliance with Paragraph 15.17 of the Malaysia Securities ExchangeBerhad (‘the Exchange’) Listing Requirements, where the Committee is of the view that a matter reported by it to the Board has not beensatisfactorily resolved resulting in a breach of the Listing Requirements,the Committee must promptly report such matter to the Exchange.


Audit Committee Report


Tore JohnsenChief Executive Officer

Profile of Chief Executive Officer

responsible for the cellular businessof NMT-450/900 and GSM 900networks. With his subsequentappointment as Project Director at Mobility, Telenor International, he was tasked with providing supportfor Telenor’s greenfield and mobileacquisition activities, as well as theirinternational mobile ventures. Justprior to joining DiGi as Head ofCorporate Strategy in January 2000,he was the Mobile Product Director at Telenor Asia in Singapore. Heassumed duties as DiGi’s ChiefOperating Officer on February 15,2001, before being appointed as Chief Executive Officer of DiGi.ComBerhad and DiGi TelecommunicationsSdn Bhd on January 1, 2004.

Tore Johnsen is the Chief ExecutiveOfficer of DiGi.Com Berhad and DiGiTelecommunications Sdn Bhd. Heobtained a Masters degree in ElectricalEngineering from the University ofTrondheim, Norway in 1972, beforeembarking on a long and distinguishedcareer at Telenor. He began as anengineer at Telenor Radio TransmissionOffice in 1974, and advancing through the ranks, soon increased his involvement in Telenor’s mobileactivities. He gained extensiveinternational experience in variouscellular business areas in hisappointment as Senior Advisor andDeputy CTO of Telenor Mobil AS. This naturally led to his next portfolioas Head of Product Management

Management Group32 DiGi.Com Berhad (425190-X)

Erik AasHead, Mobile

Khor Choo LinGM, Human Resource &Administation

Jon EddyChief Technical Officer

Tan Lay SweeGM, Internal Audit

Ho MengChief Financial Officer

Chua Seok ThengChief Information Officer

Tan Kim ShahSr GM, International

Chan Nam KiongGM, Sales & Distribution

Christina Ng Wai MengGM, Customer Services


Tore JohnsenChief Executive Officer

Roslan bin RosliDGM, Regulatory, Legal &Domestic Carrier Services

Jennifer NelsonSr Manager, CorporateCommunications

We aim to give our

customers more than

100 per cent in terms

of meeting and

exceeding their

expectations

....for a world-class network,top quality products and customercare they can count on

Year ended Year ended Eight months ended Year ended Year ended31 December 2003 31 December 2002 31 December 2001 30 April 2001 30 April 2000

(Restated) (Restated)RM’000 RM’000 RM’000 RM’000 RM’000

Revenue 1,713,529 1,289,564 747,042 887,004 634,380

Profit before taxation 201,536 145,770 121,921 152,145 57,658

Profit after taxation 142,223 100,870 158,921 152,145 57,658

Total assets 3,247,432 3,008,517 2,410,361 2,077,263 1,619,694

Shareholders’ fund 1,459,838 1,317,615 1,216,745 1,057,824 905,679

Long term liabilities 750,035 815,715 678,002 490,906 76,312

Profit after taxation as % of revenue 8.3% 7.8% 21.3% 17.2% 9.1%

Earnings per share (sen) 19.0 13.4 21.2 20.3 8.5

Net tangible assets per share (RM) 1.84 1.64 1.53 1.38 1.21

Note: The above group financial summary has been prepared to conform with the current year’s presentation of the financial statements.

Group Financial Summary36 DiGi.Com Berhad (425190-X)

Profit before taxationRM ’000

Note:* denotes eight months ended 31 December 2001

634,3

80

887,0

04

747,0

42

1,2

89,5

64

1,7

13,5

29

57,6

58

152,1

45

121,9

21

145,7

70

201,5

36

2000 2001 2001* 2002 2003 2000 2001 2001* 2002 2003

RevenueRM ’000

Long term liabilitiesRM ’000

Net tangible assetsper shareRM


Profit after taxationRM ’000

1,6

19,6

94

2,0

77,2

63

2,4

10,3

61

3,0

08,5

17

3,2

47,4

32

905,6

79

1,0

57,8

24

1,2

16,7

45

1,3

17,6

15

1,4

59,8

38

2000 2001 2001* 2002 2003 2000 2001 2001* 2002 2003

57,6

58

152,1

45

158,9

21

100,8

70

142,2

23

Shareholders’ fundRM ’000

Total assetsRM ’000

2000 2001 2001* 2002 2003

2000 2001 2001* 2002 2003 2000 2001 2001* 2002 2003

1.2

1

1.3

8

1.5

3

1.6

4

1.8

4

76,3

12

490,9

06

678,0

02

815,7

15

750,0

35

Tahun berakhir Tahun berakhir Lapan bulan berakhir Tahun berakhir Tahun berakhir31 Disember 2003 31 Disember 2002 31 Disember 2001 30 April 2001 30 April 2000

(Dinyata semula) (Dinyata semula)RM’000 RM’000 RM’000 RM’000 RM’000

Hasil 1,713,529 1,289,564 747,042 887,004 634,380

Keuntungan sebelum cukai 201,536 145,770 121,921 152,145 57,658

Keuntungan selepas cukai 142,223 100,870 158,921 152,145 57,658

Jumlah aset 3,247,432 3,008,517 2,410,361 2,077,263 1,619,694

Dana pemegang saham 1,459,838 1,317,615 1,216,745 1,057,824 905,679

Tanggungan jangka panjang 750,035 815,715 678,002 490,906 76,312

Keuntungan selepas cukai sebagai % hasil 8.3% 7.8% 21.3% 17.2% 9.1%

Pendapatan sesaham (sen) 19.0 13.4 21.2 20.3 8.5

Aset ketara bersih sesaham (RM) 1.84 1.64 1.53 1.38 1.21

Nota: Ringkasan kewangan kumpulan di atas telah disediakan mengikut pembentangan baru penyata kewangan bagi tahun semasa.

Ringkasan Kewangan Kumpulan38 DiGi.Com Berhad (425190-X)


Keuntungan sebelum cukaiRM ’000

Nota:* menandakan lapan bulan berakhir 31 Disember 2001

634,3

80

887,0

04

747,0

42

1,2

89,5

64

1,7

13,5

29

57,6

58

152,1

45

121,9

21

145,7

70

201,5

36

2000 2001 2001* 2002 2003 2000 2001 2001* 2002 2003

HasilRM ’000

1,6

19,6

94

2,0

77,2

63

2,4

10,3

61

3,0

08,5

17

3,2

47,4

32

905,6

79

1,0

57,8

24

1,2

16,7

45

1,3

17,6

15

1,4

59,8

38

2000 2001 2001* 2002 2003 2000 2001 2001* 2002 2003

57,6

58

152,1

45

158,9

21

100,8

70

142,2

23

2000 2001 2001* 2002 2003

2000 2001 2001* 2002 2003 2000 2001 2001* 2002 2003

1.2

1

1.3

8

1.5

3

1.6

4

1.8

4

76,3

12

490,9

06

678,0

02

815,7

15

750,0

35

Keuntungan selepas cukaiRM ’000

Jumlah asetRM ’000

Dana pemegangsahamRM ’000

Aset ketara bersih sesahamRM

Tanggungan jangka panjangRM ’000


82003 12 31 2002 12 31 2001 12 31 2001 4 30 2000 4 30

RM’000 RM’000 RM’000 RM’000 RM’000

1,713,529 1,289,564 747,042 887,004 634,380

201,536 145,770 121,921 152,145 57,658

142,223 100,870 158,921 152,145 57,658

3,247,432 3,008,517 2,410,361 2,077,263 1,619,694

1,459,838 1,317,615 1,216,745 1,057,824 905,679

750,035 815,715 678,002 490,906 76,312

8.3% 7.8% 21.3% 17.2% 9.1%

19.0 13.4 21.2 20.3 8.5

1.84 1.64 1.53 1.38 1.21


82003 12 31 2002 12 31 2001 12 31 2001 4 30 2000 4 30

RM’000 RM’000 RM’000 RM’000 RM’000

1,713,529 1,289,564 747,042 887,004 634,380

201,536 145,770 121,921 152,145 57,658

142,223 100,870 158,921 152,145 57,658

3,247,432 3,008,517 2,410,361 2,077,263 1,619,694

1,459,838 1,317,615 1,216,745 1,057,824 905,679

750,035 815,715 678,002 490,906 76,312

8.3% 7.8% 21.3% 17.2% 9.1%

19.0 13.4 21.2 20.3 8.5

1.84 1.64 1.53 1.38 1.21


634,3

80

887,0

04

747,0

42

1,2

89,5

64

1,7

13,5

29

57,6

58

152,1

45

121,9

21

145,7

70

201,5

36

2000 2001 2001* 2002 2003 2000 2001 2001* 2002 2003

1,6

19,6

94

2,0

77,2

63

2,4

10,3

61

3,0

08,5

17

3,2

47,4

32

905,6

79

1,0

57,8

24

1,2

16,7

45

1,3

17,6

15

1,4

59,8

38

2000 2001 2001* 2002 2003

57,6

58

152,1

45

158,9

21

100,8

70

142,2

23

RM ’000

2000 2001 2001* 2002 2003

2000 2001 2001* 2002 2003 2000 2001 2001* 2002 2003

1.2

1

1.3

8

1.5

3

1.6

4

1.8

4

76,3

12

490,9

06

678,0

02

815,7

15

750,0

35

2001 12 31

RM ’000 RM ’000

RM ’000RM ’000

RM ’000

2000 2001 2001* 2002 2003

RM

DiGi ageg

edert defr

ased der saw

gert asde

erasd ageg

edert defr

ased der saw

gert asde

erasd ageg

edert defr

ased der saw

gert asde

erasd ageg

edert defr

ased der saw

gert asde

erasd ageg

ede.

our aspirationTo be the mobile communicationsleader in creating experiences witha difference for our customers andbusiness partners through ourpassion for success

our aspirationTo be the mobile communicationsleader in creating experiences witha difference for our customers andbusiness partners through ourpassion for success

We have a passion for our customers

We value ideas and encourage initiative

We emphasise mutual trust and respect

We believe in the power of teamwork

We build partnerships for success

our key principles

Our mision is to

provide customers

with specific

solutions to meet

individual needs

for

communications,

connectivity,

access to

information and

security. Provide

an environment

where our

employees can

grow and be

fulfilled. Provide

superior returns to

shareholders.

Contribute to

We maintain our

leadership position as

industry innovator with

our continued ability

whether in delivery of

the latest services,

customer care,

competitive pricing, or

ways to secure and

keep our customers

delighted

to come up with the most innovative solutions,

Chairman’s Statement/Penyata Pengerusi44 DiGi.Com Berhad (425190-X)

Dear shareholders,

On behalf of the Board of Directors ofDiGi.Com Berhad, I am pleased topresent you with the Annual Reportand Financial Statements of the Groupand the Company for the financialyear ended 31 December 2003.

This year, the telecommunicationsindustry continued to evolve at anunprecedented pace. The formation of a leaner industry structure due to consolidation from five mainplayers down to three during the yearunder review, saw keener and moreintense competition in the mobilecommunications sector. In the face ofsuch challenges, DiGi has successfullyforged ahead as a leading playerbecause it has been able to adaptquickly, harness the power ofinnovation and maintain its positionas a high-performance business. Ithas stayed true to its commitment ofbringing the benefits of cutting-edgewireless mobile multimedia productsand services to as many Malaysiansas possible.

During the year, we focused ourattention on giving our customerssimple and easy-to-use products andservices that they really want andexpect from their mobile serviceprovider. We have made excellentprogress towards this objective by

Pemegang saham sekalian,

Bagi pihak Lembaga PengarahDiGi.Com Berhad, saya sukacita untukmembentangkan Laporan Tahunandan Penyata Kewangan Kumpulandan Syarikat bagi tahun kewanganberakhir 31 Disember 2003.

Tahun ini, industri telekomunikasiterus berkembang pesat pada kadaryang tidak pernah dicapai sebelumini. Pembentukan struktur industriyang lebih cekap, hasil penggabunganlima peserta utama untuk menjaditiga peserta pada tahun yangdilaporkan, mewujudkan persainganyang lebih hebat dan sengit dalamsektor komunikasi mudah alih.Walaupun menghadapi cabaran-cabaran tersebut, DiGi telah berjayamelangkah maju sebagai peserta utamakerana ia berupaya menyesuaikan diridengan pantas, memanfaatkan kuasainovasi dan mengekalkan kedudukannyasebagai perniagaan prestasi tinggi.DiGi tetap berpegang kepadakomitmennya untuk membawafaedah-faedah produk danperkhidmatan multimedia mudahalih terkini kepada seberapa ramairakyat Malaysia yang mungkin.

Pada tahun yang dilaporkan,perhatian kami tertumpu kepadausaha memberikan pelanggan kamiproduk dan perkhidmatan yang

...DiGi’s core strength is its ability for quick andcontinuous innovation with practical and

relevant applications...

launching a wide range of innovativeand value-for-money products andservices for both our prepaid andpostpaid customers. This was reflectedin DiGi being ranked second as a company that is innovative inresponding to customers’ needs in theFar Eastern Economic Review’s annualcompany survey, the Review 200:Asia’s Leading Companies.

I believe that DiGi’s core strength isits ability for quick and continuousinnovation with practical and relevantapplications that cater to changingcustomer needs and expectations.Coupled with this has been a concertedeffort to widen and enhance the DiGibrand for greater recognition of ourwarm, friendly and approachablepersonality. All these activities havecontributed to the Group’s steadyoverall operating performance amidstan increasingly competitive businessenvironment.

mudah digunakan yang dikehendakidan diharapkan oleh mereka daripadapembekal perkhidmatan mudah alih.Kami telah mencapai kemajuan besarke arah mencapai objektif tersebutdengan pelancaran pelbagai produkdan perkhidmatan inovatif yangmemberikan nilai untuk wang bagipelanggan prabayar dan pasca bayarkami. Kesungguhan kami dapatdilihat daripada kedudukan DiGi ditempat kedua sebagai syarikat yangmemenuhi keperluan pelanggandalam kaji selidik tahunan Review200: Asia’s Leading Companies olehmajalah Far Eastern Economic Review.

Saya percaya kekuatan teras DiGi ialahkemampuannya untuk menghasilkaninovasi dengan pantas dan secaraberterusan dengan aplikasi yangpraktikal dan relevan yang memenuhikeperluan dan jangkaan pelangganyang semakin berubah. Di sampingitu, langkah-langkah bersepadu telahdiambil untuk memperluas danmempertingkatkan jenama DiGi agarpersonaliti kami yang ramah, mesradan mudah didekati mendapatpengiktirafan yang lebih meluas. Hasildaripada semua kegiatan ini, Kumpulantelah mencatatkan prestasi operasikeseluruhan yang lebih mantapwalaupun dalam suasana perniagaanyang semakin kompetitif.


Financial Performance

For the financial year ended 31December 2003, the Group registeredstrong revenue growth of 33% toachieve a record RM1.71 billion fromthe previous financial year. Net profitssoared 41% to 142.2 million, andearnings per share rose significantlyto 19.0 sen from the previous year’s13.4 sen. The consistent revenuegrowth trend achieved throughout theyear under review has been attributedto higher mobile revenue, mainly fromour 37% mobile customer growth.Earnings before interest, taxation,depreciation and amortization(‘EBITDA’) were boosted by theincreased revenue growth to animpressive RM698.9 million with animproved margin of 41% from 38%achieved in the previous year.

Current Challenges

A milestone development for theentire industry during the year hasbeen the consolidation of the industrythat has invariably changed thecompetitive landscape. Also, as themobile penetration rate, currently at44%, moves towards maturity, weneed to work harder to entice andkeep customers and maintainprofitability by improving servicedelivery, price competitiveness andinnovative customized packaging.DiGi is poised to face this challengeby consistently responding quickly to the needs of our customers andintelligently to our competition. Wehave put our customers at the centerof everything we do and everyoperational unit is focused onproviding customers with productsand services that directly addresstheir needs and wants.

Prestasi Kewangan

Bagi tahun kewangan berakhir 31Disember 2003, Kumpulan telahmencatatkan pertumbuhan hasil yangkukuh sebanyak 33% berbandingtahun kewangan sebelumnya untukmencapai hasil rekod berjumlahRM1.71 bilion. Keuntungan bersihmeningkat 41% kepada 142.2 jutadan pendapatan sesaham meningkatsecara mendadak kepada 19.0 senberbanding 13.4 sen pada tahunsebelumnya. Trend pertumbuhanhasil yang konsisten yang dicapaisepanjang tahun yang dilaporkandiperolehi daripada hasil perkhidmatanmudah alih yang lebih tinggi,terutamanya kerana pertumbuhan37% dalam pelanggan mudah alih.Pendapatan sebelum faedah, cukai,susut nilai dan pelunasan (“EBITDA”)turut meningkat kepada RM698.9juta, sejajar dengan kenaikan hasil,dengan margin 41% yang lebih tinggiberbanding 38% yang dicapai padatahun sebelumnya.

Cabaran Semasa

Satu perkembangan penting bagiseluruh industri pada tahun yangdilaporkan ialah penggabunganindustri yang telah mengubahstruktur persaingan. Di samping itu,memandangkan kadar penembusanmudah alih yang kini mencapai tahap 44% sudah mula matang, kami perlu berusaha lebih gigih untuk memperolehi dan mengekalkanpelanggan serta mengekalkan tahapkeuntungan dengan memperbaikibekalan perkhidmatan, daya saingharga dan pakej inovatif terkhusus.DiGi bersedia untuk menghadapicabaran-cabaran ini dengan bertindakbalas pantas secara konsisten untukmemenuhi keperluan pelanggan kamidan mengambil langkah yang bijakuntuk menandingi pesaing kami. Kami memastikan pelanggan menjadi


keutamaan kami dan setiap unit operasimemberi tumpuan membekalkanproduk dan perkhidmatan yangmemenuhi keperluan dan kehendakpelanggan secara langsung.

Pada tahun yang dilaporkan, kami menekankan lagi keputusanstrategik untuk memainkan peranandalam rantaian nilai 3G. Denganmemperkenalkan produk danperkhidmatan multimedia mudah alih yang canggih dan berpatutanmenerusi rangkaian 2.5G kami yang sedia ada untuk memenuhipermintaan awal, serta langkahmenaik taraf rangkaian kami yangtelah selesai dijalankan untukmembolehkan teknologi tanpa wayargenerasi akan datang digunakanmenerusi Kadar Data Dipertingkatkanuntuk Evolusi GSM (EDGE), pelangganDiGi akan dapat menikmati panggilansuara lebih berkualiti dan perkhidmatanmultimedia lanjut pada kelajuan lebihpantas. Kami berada selangkah dihadapan mana-mana pembekalperkhidmatan komunikasi di Malaysia.

Pada masa yang sama, usahabersepadu sedang dilaksanakan untukmemantapkan kualiti dan kapasitirangkaian dan memperluas liputan

During the year, we underscored ourstrategic decision to play a role alongthe 3G value chain. Through creativelyintroducing a full range of advancedand affordable mobile multimediaproducts and services on our existing2.5G network to meet initial demand,alongside completed efforts inupgrading our network to facilitatenext-generation wireless technologyusing Enhanced Data Rates for GSMEvolution (EDGE), DiGi customers willbe able to enjoy higher quality voicecalls, advanced multimedia servicesat faster speeds, one step ahead ofany other mobile communicationsservice provider in Malaysia.

At the same time, concerted effortswere made to strengthen our networkquality and capacity and expand ourgeographical coverage. To this end, DiGihas worked on building partnershipsand strategic alliances at all levelswith network operators, handsetmanufacturers, middleware providersand applications developers toreinforce its leading-edge productsand services.


...next-generation wirelesstechnology using EDGE,our customers will be ableto enjoy higher qualityvoice calls, advancedmultimedia services atfaster speeds, one stepahead of any other mobilecommunications serviceprovider in Malaysia

One striking example is in mobiledata services, which now enables thesending of messages from handset to handset along with still-pictures,video clips and audio content. I ampleased to report that in August 2003,DiGi became the first service providerin the industry to launch MMS for bothits prepaid and postpaid segmentsand we continue to work towardsupgrading the technologies thatsupport this service.

Strategic Direction

The year under review saw theintroduction and implementation ofinitiatives like consolidation, newaccess pricing, infrastructure sharing,and mandatory standards governingaccess and quality of service. We areconfident that DiGi is ready andcapable of meeting these challenges.The drive for product innovationcontinues to be the key factor thatwill allow us to strengthen our marketshare and build a strong and sustainedcustomer base.

In response to the highly dynamicbusiness environment that we operatein, the company has sought to‘reinvent’ itself, allowing DiGi to leadthe market in rolling out services thatare timely, relevant and cost-effective.We have long-recognised the need for a clear growth strategy and alsothe need for that clarity to becommunicated to all our employees,partners and customers. Taking thisapproach, management and stafforchestrated a convincing change ofDiGi’s profile during the year underreview. We are now a much warmer,friendlier and more approachable DiGiat all points of contact. We saw theneed to build the DiGi brand into onethat provides quality products that

geografi kami. Untuk tujuan itu, DiGi telah berusaha membina pakatandan perkongsian strategik di setiapperingkat dengan pengendalirangkaian, pengeluar telefon mudahalih, pembekal perisian perantara danpencipta aplikasi untuk memperkukuhproduk dan perkhidmatan canggihnya.

Satu contoh yang baik ialahperkhidmatan data mudah alih, yang kini membolehkan penghantaranmesej yang mengandungi gambarpegun, klip video dan kandunganaudio dari satu telefon mudah alih ketelefon mudah alih lain. Saya sukacitauntuk melaporkan bahawa pada Ogos 2003, DiGi menjadi pembekalperkhidmatan pertama dalam industriuntuk melancarkan MMS untuksegmen prabayar dan pasca bayardan kami akan terus berusaha menaiktaraf teknologi yang menyokongperkhidmatan ini.

Hala Tuju Strategik

Pada tahun yang dilaporkan, inisiatifseperti penggabungan, harga capaianbaru, perkongsian infrastruktur danpiawaian mandatori untuk mengawalcapaian dan kualiti perkhidmatan,telah diperkenalkan dan dilaksanakan.Usaha untuk mencapai inovasi produkterus menjadi faktor utama yangmembolehkan kami meningkatkanbahagian pasaran dan membina asaspelanggan yang kukuh dan mampan.

Sebagai tindak balas kepada suasanaperniagaan yang sangat dinamik,syarikat telah berusaha ‘memperbaharui’operasinya, lantas membolehkan DiGi mendahului pasaran denganmelancarkan perkhidmatan yangrelevan, menjimatkan kos dan tepatpada masanya. Sejak dulu lagi, kami menyedari betapa perlu kami

To be the key factor that will allow us to strengthen our marketshare and build a strong and sustained customer base


are not only innovative but affordableand practical, coupled with a servicethat is reliable and of impeccablequality. DiGi products and servicesoffer a value proposition thatcustomers can use to enhance theirlifestyle and facilitate businessefficiency.

In tandem with these considerations,four key areas were identified asrequiring our undivided attention inorder to improve our performanceand maintain a competitive edge:

• We saw the need to expand ournetwork coverage and gain accessto new market centres as a key areaof emphasis in addressing customerdemands for uncompromised qualityto match their increasing mobilityneeds. In this, our market-centriccoverage expansion strategy hasresulted in significant growth in our net customer additions duringthe year under review, with widerrecognition of DiGi’s “best where we are” network quality throughoutthe nation.

• Undivided customer focus andattention was another key priorityarea. Our main message to bothour customers and our staff wasthat the customer is the focus of all that we do. We are putting allour efforts into learning more aboutour customers, understanding whatthey need and want, and then givingthem simple, user-friendly productsand services to meet these needs.During the year we introduced a series of innovative, intelligentand straightforward mobilecommunications services and productenhancements that allowed ourcustomers to stay connected andhave access to information andentertainment with greater mobility,speed, convenience and clarity.


merangka strategi pertumbuhan yang jelas. Strategi yang jelas itujuga perlu disampaikan kepadakakitangan, rakan perniagaan danpelanggan kami. Menerusi pendekatanini, pihak pengurusan dan kakitangantelah melaksanakan rombakan profilDiGi yang meyakinkan dalam tahunyang dilaporkan. DiGi kini lebih ramah,mesra dan mudah didekati di setiaptitik pertemuan. Kami menyedaribetapa perlunya membina jenamaDiGi yang membekalkan produkberkualiti yang bukan sahaja inovatiftetapi pada harga berpatutan danpraktikal, di samping menyediakanperkhidmatan yang boleh dipercayaidan bermutu paling tinggi. Produkdan perkhidmatan DiGi menawarkannilai yang boleh dimanfaatkan olehpelanggan untuk meningkatkan gayahidup mereka dan menambahkankecekapan perniagaan.

Sejajar dengan segala pertimbangandi atas, empat bidang penting yangmemerlukan perhatian penuh kamiuntuk meningkatkan prestasi danmengekalkan kelebihan daya saingtelah dikenal pasti:

• Kami menyedari keperluan untukmemperluas liputan rangkaian danmenembusi pusat pasaran barusebagai tumpuan utama dalamusaha kami memberikan kualititerbaik kepada pelanggan bagimemenuhi keperluan pergerakanmereka yang semakin meningkat.Dalam hal ini, strategi memperluasliputan yang tertumpu kepadapasaran telah menghasilkanpertumbuhan besar dari segi jumlahpertambahan pelanggan bersihpada tahun yang dilaporkan. Kualitirangkaian DiGi telah mendapatpengiktirafan meluas sebagai“terbaik di mana kami berada” di seluruh negara.

• In order to maintain our position asan industry leader, the companycontinues to place emphasis onstrengthening and upgrading ourmobile network. As mentionedearlier, to this end we madestrategic investments that enabledus to upgrade our mobile networkwith the introduction of EDGEtechnology. In fact, DiGi is the firstservice provider in Malaysia toannounce its commitment to EDGEtechnology, an evolutionaryimprovement in packet-based dataservices that provides users withfaster and more powerful mobiledata applications. With EDGE, DiGiwill be able to provide customerswith a seamless migration from ourcurrent 2.5G network to 3G-typeservices by tripling the rate of datatransfer. Our customers will be ableto use faster and more powerfulmobile data applications such asMMS over both our prepaid andpostpaid service.

• The introduction of new productsand services is, of course, crucial ifwe wish to make our mark in thefield of mobile content and dataservices. Sustained growth dependson our ability to deliver new andinnovative customized products and services that directly addresscustomer needs and wants.Throughout the year, we havelaunched new products and servicesin both the prepaid and postpaidsegments. We have also set out todissolve the boundaries betweenprepaid and postpaid to enable atruly seamless delivery of servicesto subscribers in both thesesegments. This is very much inkeeping with DiGi’s strategic focuson centering our products andservices around customer needs inorder to improve average revenueper user and build long-termprofitability into our operations.

• Tumpuan dan perhatian khususyang tidak berbelah bagi terhadappelanggan merupakan satu lagibidang keutamaan. Mesej utama kamikepada pelanggan dan kakitanganialah pelanggan menjadi tumpuandalam apa jua yang kami lakukan.Kami mencurahkan tenaga kamiuntuk mempelajari lebih lanjuttentang pelanggan, memahami apa yang mereka kehendaki danperlukan, dan menyediakan produkdan perkhidmatan yang mudah danmesra pengguna untuk memenuhikeperluan mereka. Pada tahun yang dilaporkan, kami telahmemperkenalkan beberapaperkhidmatan komunikasi mudahalih yang inovatif, pintar dan ringkas,dan melaksanakan peningkatanproduk yang membolehkanpelanggan terus berhubung danmendapatkan maklumat danhiburan dengan daya pergerakan,kepantasan, kemudahan dankejelasan yang lebih tinggi.

• Untuk mengekalkan kedudukankami sebagai pemimpin industri,syarikat terus memberi penekanankepada usaha untuk memantapkandan menaik taraf rangkaian mudahalih kami. Seperti yang disebutkansebelum ini, kami telah membuatpelaburan strategik untuk tujuan iniyang membolehkan kami menaiktaraf rangkaian mudah alih denganmemperkenalkan teknologi EDGE.Malah, DiGi adalah pembekalperkhidmatan pertama di Malaysiauntuk mengumumkan komitmennyakepada teknologi EDGE, satuperkembangan evolusi dalamperkhidmatan data berasaskanpaket yang menyediakan aplikasidata yang lebih pantas dan berkuasakepada pengguna. Menerusi EDGE,DiGi akan membolehkan pelangganberpindah dengan lancar daripadaperkhidmatan rangkaian 2.5G kamiyang sedia ada kepada 3G, dengan


memindahkan data tiga kali lebihpantas. Pelanggan kami akan dapatmenggunakan aplikasi data mudahalih yang lebih pantas dan berkuasaseperti MMS menerusi perkhidmatanprabayar dan pasca bayar kami.

• Langkah memperkenalkan produkdan perkhidmatan baru ternyatasangat penting sekiranya kami ingin mencapai kejayaan dalambidang kandungan mudah alih danperkhidmatan data. Pertumbuhanmampan bergantung kepadakeupayaan kami untuk membekalkanproduk dan perkhidmatan yangbaru dan inovatif dalam segmenprabayar dan pasca bayar. Kamijuga telah berusaha menghapuskansempadan antara khidmat prabayardan pasca bayar untuk menyediakanperkhidmatan yang benar-benarlancar kepada pelanggan di kedua-dua segmen ini. Ini adalah selarasdengan tumpuan strategik DiGiuntuk menyesuaikan produk danperkhidmatan kami mengikutkeperluan pelanggan bagimeningkatkan purata hasil daripadasetiap pengguna dan membinakeuntungan jangka panjang bagioperasi kami.

Prospek

Tahun 2003 merupakan tahunperubahan bagi pasaran komunikasimudah alih Malaysia. Walaupuncabaran-cabaran besar dihadapi olehindustri dalam penggabungannya, ia telah muncul sebagai entiti yanglebih dikawal selia dan canggih. Hasilpenggabungan ini, kami percayapasaran bagi penyelesaian gaya hidupkomunikasi mudah alih akan terus

The market of the future will be driven byconvenience, ease of use and reliability


Prospects

The year 2003 was a transitional year for the Malaysian mobilecommunications market and althoughthere were great challenges faced bythe industry in its consolidation, ithas re-emerged as a more regulatedand sophisticated entity. From this,we believe that the market for mobilecommunications lifestyle solutions willcontinue to grow steadily. The growthprospects for Malaysia look equallyexciting and we believe that DiGi cancontinue to achieve a sustained,profitable market position.

Indeed, the future looks promising. Themobile communications market is stillgrowing; mobile users are becomingmore educated, sophisticated anddiscerning. As a company, DiGi isintensifying its efforts in innovationand customer service in order to stay ahead of the competition. Themarket of the future will be driven by convenience, ease of use andreliability. People want to be connectedfrom wherever they are, be it athome or from their office, car orvacation site. They want wireless dataservices which allow them to performeveryday functions like reading an e-mail or obtaining importantinformation, without being tied to adesktop at home or at the office.They will want to use this data notjust for business, but to keep in touchwith their friends and family, whilecompleting personal chores likebanking or shopping. And we must beready to provide these services in themost simple-to-use, affordable andinnovative way.

With the new wave of mobilemultimedia services, DiGi has theclear advantage in remaining anindustry leader and innovator. Wehave made significant investments in technology and people which will enable us to stay ahead of thecompetition through product innovation,excellent customer care and prudentmanagement. We believe DiGi canachieve significant growth inshareholder value over both the shortand longer term. Although we expectmore intense competition in thefuture, we are committed to achievingreturns across every aspect of ourbusiness.

Social Responsibility

At DiGi, we also firmly believe that asa caring and responsible corporatecitizen, we need to be able to contributeeffectively towards the well-being andcare of people in the communitieswhere we operate our business. Weare committed to finding avenueswhere we can interact and touch thelives of local communities in a realand meaningful way. We want to beknown as an industry leader in themobile communications industry butalso as a friend who is there to helpenrich the lives of a sector of thecommunity that is often neglectedand forgotten.

berkembang secara beransur-ansur.Malaysia mempunyai prospekpertumbuhan yang menarik dan kamipercaya DiGi akan terus mencapaikedudukan pasaran yang mampandan menguntungkan.

Ternyata bahawa masa depan kaminampak cerah. Pasaran komunikasimudah alih masih berkembang; danpengguna mudah alih kini semakinbijak, canggih dan bersifat pemilih.Sebagai sebuah syarikat, DiGi sedangmenggiatkan usaha dalam inovasidan perkhidmatan pelanggan untukmengatasi para pesaing. Pasaranmasa depan dipacu oleh kemudahan,kesenangan penggunaan dankebolehpercayaan. Orang ramai ingindihubungkan dari mana-mana sahajamereka berada, sama ada di rumahatau di pejabat, di dalam kereta atau di pusat peranginan. Merekamahukan perkhidmatan data tanpawayar yang membolehkan merekamelakukan fungsi harian sepertimembaca e-mel atau mendapatkanmaklumat penting, tanpa terikatkepada komputer meja di rumah atau di pejabat. Mereka mahumenggunakan data ini bukan sahajauntuk perniagaan, tetapi untukberhubung dengan rakan-rakan dankeluarga, sambil melakukan tugasanperibadi seperti urusan bank danmembeli-belah. Kami perlu bersediamembekalkan perkhidmatan-perkhidmatan tersebut dengan carayang inovatif dan mudah digunakanpada harga paling berpatutan.

Dengan ketibaan arus perkhidmatanmultimedia mudah alih yang baru,DiGi mempunyai kelebihan yang jelas sebagai pemimpin dan peloporindustri. Kami telah membuatpelaburan besar dalam teknologi daninsan yang akan membolehkan kamiberada di hadapan pesaing menerusiinovasi produk, perkhidmatanpelanggan yang cemerlang danpengurusan yang teliti. Kami percayaDiGi boleh mencapai pertumbuhan

We want to be known as an industrywho is there to help enrich


The DiGi Yellow Mobile communityprogramme, launched in 2002, has effectively communicated thiscommitment, gathering momentumduring the year under review andattracting widespread media coverage.At the same time, this arts-and-culture-based interactive programmehas given DiGi employees a uniqueopportunity to be directly involved inthe workshops, through volunteeringtheir time and energy at each stop-over. This, and DiGi’s other corporatesocial responsibility efforts, have not only enriched the lives of ouremployees, but also left behind alasting impression of the heart-warming role of DiGi’s communityoutreach.

More details on these communityefforts are highlighted in theCorporate Social Responsibilitysection of this annual report.

Acknowledgements

On behalf of the Board of Directors, I would like to acknowledge the hardwork and dedication of our DiGi staffat all levels. It is through their driveand commitment that the companyhas been able to maintain its role asa significant player in this highlycompetitive industry. I acknowledgethe inspiration and effort behind theinnovative and creative products andservices that have helped differentiateDiGi from its competitors andspearheaded us into the forefront of this industry.

I would also like to record my deepgratitude to and appreciation of mycolleagues on the Board, and theOperating Committee. Their expertise,experience and professionalism havebeen crucial in helping us formulate aclear growth strategy that has helpedus face the challenges in the yearunder review.

leader in the mobile communications industry but also as a friend the lives of a sector of the community that is often neglected and forgotten


besar dari segi nilai pemegang saham pada masa depan, dan kamiberkomitmen untuk mencapaipulangan positif daripada segenapaspek perniagaan kami.

Tanggungjawab Sosial

Di DiGi, kami juga benar-benarpercaya bahawa sebagai wargakorporat yang prihatin danbertanggungjawab, kami perlumemberi sumbangan bermakna untuk menjaga kesejahteraanmasyarakat di tempat kamimengendalikan perniagaan. Kamiberkomitmen untuk mencari jalanuntuk berhubung dan menyentuhkehidupan masyarakat tempatandengan cara yang bermakna danbermanfaat. Kami juga ingin dikenalibukan sahaja sebagai pemimpindalam industri komunikasi mudah alihtetapi juga sebagai sahabat yangsanggup membawa manfaat kepadakehidupan golongan masyarakat yangsering diabaikan dan terpinggir.

Program kemasyarakatan DiGi YellowMobile, yang dilancarkan pada 2002,telah memperlihatkan komitmen inidengan berkesan, dan program inisemakin giat dijalankan dalam tahunyang dilaporkan. Ia telah mendapatliputan media yang meluas. Padamasa yang sama, program interaktifberdasarkan keseniaan dan kebudayaanini telah memberi peluang unikkepada kakitangan DiGi untukmelibatkan diri dalam bengkel-bengkelyang dianjurkan, dan meluangkanmasa dan tenaga mereka di setiappersinggahan. Program tersebut, serta program tanggungjawabkorporat sosial lain DiGi bukan sahajameluaskan pengalaman kakitangan,tetapi turut meninggalkan tanggapanpositif yang berkekalan tentangkeprihatinan DiGi menghulur tangankepada masyarakat.

We are grateful for the efforts of theMinistry of Energy, Communicationsand Multimedia (MECM) and theMalaysian Communications andMultimedia Commission (MCMC) tocreate and stimulate a conducive andregulated environment for growth inthis fast-evolving industry. We willcontinue to work together with thegovernment to move the industry togreater heights, with the key priorityfocused on the development of Malaysiaas a global hub for communicationsand multimedia services.

Finally, the strong performance of theGroup in 2003 would not have beenpossible without the support of ourshareholders, financial and industrypartners, the media and especiallyour customers. I take this opportunityto express our profound gratitude andthe Board’s sincere appreciation toeach of these. With your continuedfaith in DiGi, I am confident that theGroup is well-positioned to takeadvantage of the many challengesand opportunities ahead and we lookforward to another successful year in 2004.

Tan Sri Dato’ Seri Vincent TanChee YiounChairman19 March 2004

Butir-butir lanjut mengenai usaha-usaha kebajikan masyarakat initertera dalam seksyen TanggungjawabSosial Koporat laporan tahunan ini.

Penghargaan

Bagi pihak Lembaga Pengarah, sayamerakamkan penghargaan sayakepada kakitangan DiGi di semuaperingkat kerana usaha gigih dandedikasi mereka. Melalui usaha dankomitmen mereka, syarikat telahberjaya mengekalkan peranannyasebagai peserta penting dalam industriyang sangat kompetitif ini. Sayamenyanjung tinggi inspirasi danusaha di sebalik penciptaan produkdan perkhidmatan inovatif dan kreatifyang telah membantu membezakanDiGi daripada para pesaingnya danmemacu kami ke hadapan dalamindustri ini.

Saya juga mengucapkan ribuan terimakasih kepada rakan-rakan sejawatsaya dalam Lembaga Pengarah danJawatankuasa Operasi. Kepakaran,pengalaman dan profesionalismemereka amat penting untuk membantukami merangka strategi pertumbuhanyang jelas, yang membolehkan kamimenghadapi segala cabaran padatahun yang dilaporkan.

Kami juga menghargai usahaKementerian Tenaga, Komunikasi danMultimedia (KTKM) dan SuruhanjayaKomunikasi dan Multimedia Malaysia(SKMM) merangka dan mewujudkanpersekitaran yang sesuai dan dikawal


The strong performanceof the Group in 2003would not have beenpossible without thesupport of ourshareholders, financialand industry partners,the media andespecially ourcustomers

selia bagi menggalakkan pertumbuhandalam industri yang pantas berkembangini. Kami akan terus berganding bahudengan kerajaan untuk membawaindustri telekomunikasi ke puncak yanglebih tinggi. Keutamaan akan diberikankepada usaha membangunkanMalaysia sebagai pusat global bagiperkhidmatan komunikasi danmultimedia.

Akhir sekali, prestasi kukuh Kumpulanpada 2003 pasti tidak tercapai tanpasokongan pemegang saham kami,rakan-rakan kewangan dan industri,pihak media dan khususnya pelanggankami. Bagi pihak Lembaga Pengarah,saya mengambil kesempatan iniuntuk merakamkan setinggi-tinggipenghargaan kepada semua pihak diatas. Dengan kepercayaan berterusananda terhadap DiGi, saya yakinbahawa Kumpulan akan berada pada kedudukan yang baik untukmengambil kesempatan daripadasegala peluang dan cabaran yangdihadapi dan semoga tahun 2004membawa kejayaan yang lebih besarkepada kami.

Tan Sri Dato’ Seri Vincent TanChee YiounPengerusi19 Mac 2004


We inspire confidencein our customers by givingthem a positive experiencewith world-class productsand services

Operations Review/Tinjauan Operasi

Overview

The consolidation of two majorindustry players in the last financialyear led DiGi to take a fresh look atits business strategies to ensure ithas a good chance of carving out ahealthy slice of the market. At thesame time, regulatory changes,coupled with new national policyobjectives, clearly kept DiGi on itstoes. The industry merger exercisesmeant that each resulting entity hada competitive advantage broughtabout by the combined spectrum ofthe merging companies. We neededto level the playing field, and this was effected when the MalaysianCommunications and MultimediaCommission allocated DiGi the use of EGSM band to obtain a 900 MHzfrequency capability. This has helpedus to extend our coverage, fill the gapsbetween the 1800 MHz sites andmaximize coverage in isolatedtownships. In addition, efforts areongoing to obtain a primary GSM band.

Gambaran Keseluruhan

Penggabungan dua peserta utamaindustri pada tahun kewangan yanglalu mendorong DiGi untuk mengkajisemula strategi-strategi perniagaannyabagi memastikan ia mempunyaipeluang saksama untuk menguasaibahagian pasaran yang cukup besar.Pada masa yang sama, pindaan yangdibuat kepada peraturan sertaobjektif-objektif dasar baru negaramemastikan DiGi sentiasa peka dan bersedia untuk menghadapiperkembangan terbaru. Prosespenggabungan industri bermaknasetiap entiti tergabung mempunyaikelebihan daya saing yang diperolehidaripada spektrum bersepadusyarikat-syarikat yang bergabung.Kami perlu memastikan bahawa kamidapat bersaing dengan cara yang adildan saksama. Matlamat ini tercapaiapabila Suruhanjaya Komunikasi dan Multimedia membenarkan DiGimenggunakan jalur EGSM untukmendapatkan keupayaan frekuensi


Our emphasis is on rolling out innovative,easy-to-use services that simplify and enrich

the lives of our customers

We also took a good hard look at our operations in the context of thechallenges of our rapidly changingbusiness environment, and emergedfrom this exercise with a clear focuson building the DiGi brand based onour unique understanding of ourcustomers. This, very simply, underliesour strategy for growth. Our emphasisis on rolling out innovative, easy-to-use services that simplify and enrichthe lives of our costumers. Thiscontributed to the growth of DiGi’scustomer base, alongside the variousprogrammes and promotions.

In addition, a “Voice of Customer”initiative was launched to acquirecustomer feedback, as well as tomeasure our customer experience atthe different touch points. To ensurethat customers receive relevant,timely and customized information on DiGi products and services, alifestyle-based customer newsletter,morethanwords, was launched in theyear under review, communicatingDiGi’s fresh new face, in addition tointroducing subscribers to the fullrange of DiGi products and services.

We also put more muscle intomarketing in the review period, whichhas resulted in a warmer, friendlier,more approachable personality asreflected in the DiGi logo and in allour advertising and promotionscampaigns and collaterals.

900 MHz. Ini telah membantu kamimemperluaskan rangkaian, mengisijurang antara 1800 MHz tapak danmemaksimumkan liputan di pekan-pekan terpencil. Di samping itu, kamisedang berusaha untuk mendapatkansatu jalur GSM utama.

Kami juga telah meneliti operasi kamidalam konteks cabaran yang dihadapidalam suasana perniagaan yangsentiasa berubah dengan pantas, dantelah menetapkan tumpuan yangjelas untuk membina jenama DiGiberdasarkan kefahaman unik tentangpara pelanggan kami. Ini menekankanstrategi pertumbuhan kami. Kamimemberi penekanan kepada usahauntuk melancarkan perkhidmatanyang inovatif dan mudah digunakan,serta memperbaiki dan menyenangkankehidupan pelanggan kami. Penekananini, serta pelbagai promosi danprogram yang diadakan, telahmembantu meningkatkan bilanganpelanggan DiGi.

Di samping itu, inisiatif yang dinamakan“Suara Pelanggan” telah dilancarkanuntuk mendapatkan maklum balasdaripada pelanggan, dan jugamengukur pengalaman pelanggankami di titik-titik hubungan yangberbeza. Bagi memastikan pelangganmenerima maklumat mengenaiproduk dan perkhidmatan DiGi yangrelevan, khusus dan tepat padamasanya, satu risalah beritaberasaskan gaya hidup bertajukmorethanwords telah dilancarkanpada tahun yang dilaporkan, untukmemperlihatkan wajah baru DiGi, disamping memperkenalkan rangkaianlengkap produk dan perkhidmatanDiGi kepada pelanggan.


These strategic investments haveclearly sharpened our competitiveedge, and boosted growth in ourcustomer numbers and usage, asreflected in the impressive financialgrowth trend registered in thefinancial year under review. Revenuesrose 33% to a record RM1.71 billion,mainly contributed by the mobile andinternational segments, with mobilerevenue increases spurred by the37% growth in DiGi’s mobile customerbase to 2.21 million. Earnings beforeinterest, taxation, depreciation andamortization (“EBITDA”) wereboosted by the increased revenuegrowth to an impressive RM698.9million with an improved margin of41% from 38% achieved in theprevious year. The Group saw a 41%surge in its net profits to RM142.2million, from the RM100.9 millionrecorded in the previous year, whileearnings per share improved to 19.0 sen from 13.4 sen previouslyrecorded. In this, our performance in the year under review has beenbeyond market expectations amidstthe challenge of a consolidatedindustry.

Pada masa yang sama, kami jugatelah menggiatkan usaha pemasaranuntuk menampilkan personaliti yanglebih ramah, mesra, dan mudahdidekati. Ini dipaparkan dalam logoDiGi dan dalam semua kempen,bahan iklan dan promosi kami.

Pelaburan-pelaburan strategik initelah meningkatkan daya saing kami,bilangan pelanggan dan kadarpenggunaan, seperti yang dapatdilihat daripada pertumbuhankewangan memberangsangkan yang dicapai pada tahun kewangandilaporkan. Hasil telah meningkat 33%untuk mencapai jumlah paling tinggiRM1.71 bilion, dengan sumbanganbesar diperolehi daripada segmenmudah alih dan antarabangsa.Peningkatan hasil daripada segmenmudah alih ini dipacu oleh pertumbuhan37% bilangan pelanggan mudah alihDiGi yang kini mencecah 2.21 juta.Keuntungan sebelum ditolak faedah,cukai, susut nilai dan pelunasan(“EBITDA”) juga meningkat kepadaRM698.9 juta. Ini dicapai keranapertumbuhan hasil yang lebih besar,serta margin 41% yang lebih tinggidaripada margin 38% yang dicatatpada tahun sebelumnya. Kumpulanjuga mencatatkan keuntungan bersihRM142.2 juta, satu peningkatan 41%berbanding RM100.9 juta yangdicatatkan pada tahun sebelumnya,manakala pendapatan sesahammeningkat kepada 19.0 sen berbanding13.4 sen pada tahun lepas. Perangkaantersebut menunjukkan bahawapencapaian kami bagi tahun yang

In this, our performance in theyear under review has beenbeyond market expectationsamidst the challenge of aconsolidated industry


Sales and Distribution

In 2003 there was greater focus onstrengthening DiGi’s distributionnetwork, adding to the efficiency ofindividual dealers to enable them toconcentrate on what they do best:selling. To date, DiGi has 4000 dealershelping to develop new marketsnationwide. With the launch of theDealer Loyalty Programme in thereview period, we have been betterequipped to monitor the overallprogress of its distribution networkand respond to the needs of channelpartners more effectively.

As part of efforts to support dealers,road shows and promotional eventswere held nationwide. Major coverageimprovements in any area werefollowed up by activities with therespective dealers to help rejuvenatelocal markets. DiGi’s new materials,outdoor signages and live promotionsat the dealers’ outlets all contributedtowards maximizing sales.

dilaporkan mengatasi jangkaanpasaran, walaupun kami menghadapipelbagai cabaran yang timbul akibatpenggabungan industri.

Jualan dan Pengedaran

Pada tahun 2003, tumpuan lebihkhusus diberikan terhadap usahamemperkukuhkan rangkaianpengedaran DiGi, dengan meningkatkankecekapan wakil-wakil penjual individuuntuk membolehkan mereka memberitumpuan kepada bidang jualan yangmenjadi pengkhususan mereka.Setakat ini, DiGi mempunyai 4,000wakil penjual untuk membantumembangunkan pasaran baru diseluruh negara. Dengan pelancaranProgram Kesetiaan Wakil Penjualpada tahun yang dilaporkan, kamikini lebih bersedia untuk memantaukemajuan keseluruhan rangkaianpengedaran dan bertindak balasterhadap keperluan rakan-rakansaluran dengan lebih berkesan.


We expanded the DiGi SpecialisedStores (DSS) to 20 in total, in additionto establishing more alternative reloadchannels. Looking ahead, plans are inthe pipeline to continue expandingand grooming more dealers to bringadded convenience and professionalservice to DiGi’s customers.

Network

Network availability and performanceis central to DiGi’s business. In theyear 2002, DiGi enhanced networkavailability to above 99 per cent andimproved its overall quality andreliability. In this review period, DiGi concentrated on bringing itscustomers an expanded and excitingnew range of services while itcontinued to improve networkperformance.

In the initial stages of the year underreview, DiGi installed the latestgeneration Global System for MobileCommunication (GSM) equipment inthe Klang Valley. This deploymentresulted in increased reliability,enhanced coverage and improvedvoice quality.

Sebagai sebahagian daripada usahauntuk menyokong wakil-wakil penjual,pameran bergerak dan kegiatanpromosi telah diadakan di seluruhnegara. Peningkatan besar liputanrangkaian di sesuatu kawasan telahdisusuli dengan kegiatan yangdianjurkan bersama wakil-wakilpenjual setempat untuk menggiatkansemula pasaran tempatan. Bahan-bahan baru untuk promosi, papan tandaluar dan kegiatan secara langsungDiGi di kedai-kedai wakil penjualtelah membantu memaksimumkanjualan.

Kami telah menambah bilangan KedaiKhusus DiGi (DSS) kepada 20 kedai,di samping mewujudkan lebih banyaksaluran isian semula alternatif.Rancangan sedang dirangka untukmenambah dan melatih lebih ramaiwakil penjual bagi menyediakankemudahan dan perkhidmatanprofesional tambahan kepada parapelanggan DiGi.

Rangkaian

Penyediaan dan prestasi rangkaianamat penting bagi perniagaan DiGi.Pada tahun 2002, DiGi telahmeningkatkan penyediaan rangkaiankepada lebih 99 peratus danmemperbaiki kualiti keseluruhan dan kebolehpercayaannya. Dalamtempoh yang dilaporkan, DiGimemberi tumpuan kepada usahauntuk membawa rangkaianperkhidmatan yang lebih luas danmenarik kepada pelanggan, sambilterus meningkatkan prestasirangkaian.

Pada awal tahun yang dilaporkan,DiGi telah memasang kelengkapanSistem Global bagi Komunikasi MudahAlih (GSM) generasi terbaru di Lembah

Looking ahead, plans are inthe pipeline to continueexpanding and groomingmore dealers to bring addedconvenience and professionalservice to DiGi’s customers


Klang. Penggunaan kelengkapanterbaru ini telah membolehkan dirimempertingkatkan kebolehpercayaan,memperluaskan liputan danmemperbaiki kualiti suara.

Seterusnya, DiGi telah menjadisyarikat pertama di Malaysia yangmemberikan komitmen kepadateknologi EDGE (Kadar DataDipertingkatkan Bagi Evolusi GSM),iaitu evolusi daripada PerkhidmatanPaket Radio Am (GPRS). EDGE ialahteknologi yang membolehkanmaklumat dihantar dan diterima padakelajuan optimum menggunakanrangkaian telefon mudah alih. Darisegi teknikal, EDGE ialah skimmodulasi baru yang membolehkanpenghantaran bit pada kadar yangjauh lebih tinggi merentasi antaramuka di udara. Dengan teknologi ini,DiGi akan dapat menawarkan kadardata yang lebih tinggi dan pantas,dan akhirnya akan mempermudahkanperalihan ke dalam perkhidmatangenerasi akan datang.

Pasaran-pasaran baru telah ditembusiapabila DiGi menambah bilanganStesen Transmisi Tapak kepada 450.Sejajar dengan itu, DiGi juga telahmempelopori konsep perkongsianinfrastruktur antara syarikat pembekalperkhidmatan mudah alih. Tindakanini diambil sebagai menyahut seruankerajaan agar industri telekomunikasimemanfaatkan sumber-sumberbersama. Untuk meningkatkan lagiliputan dalam bangunan, DiGi telahmengambil bahagian secara proaktifdalam projek-projek Sistem AntenaAm (CAS), yang dilaksanakanbersama Celcom dan Maxis.

Di samping perkhidmatan-perkhidmatanlebih bernilai yang telah digabungkanke dalam produk prabayar DiGi untukmemberikan kemudahan yang lebihfleksibel kepada pelanggan, sistem ini juga telah dinaik taraf untukmenyokong Perkhidmatan Pesanan

Following this, DiGi became the firstin Malaysia to commit to EnhancedData rates for GSM Evolution (EDGE)technology, which is an evolution ofGeneral Packet Radio Service (GPRS),a technology that allows informationto be sent and received at optimalspeeds across a mobile telephonenetwork. In technical terms, EDGE isa new modulation scheme that allowsa much higher bit rate across the airinterface. With it, DiGi will be able tooffer higher and faster data rates andultimately, to bridge the transitioninto next-generation services.

New markets were opened when DiGi expanded its number of BaseTransmission Stations (BTS) by 450.In tandem with this, DiGi also initiatedthe concept of infrastructure sharingbetween mobile service providers,supporting the government’s call forthe industry to efficiently utilize itscommon resources. To further increasecoverage in buildings, DiGi proactivelytook part in the Common AntennaeSystem (CAS) projects, jointlyundertaken with Celcom and Maxis.

As value-added services wereincorporated into DiGi’s prepaidproduct to offer customers greaterflexibility, the system was alsoenhanced to support MultimediaMessaging Services (MMS) to enable


DiGi customers to send and receivepictures with their mobile phones viaDiGi’s existing GPRS network.

With the allocation of an additional 2 X 2 MHz in the EGSM frequencyband, courtesy of the MalaysianCommunications and MultimediaCommission (MCMC), DiGi hasalready begun using the additionalfrequency in the introduction of adual band 900 MHz and 1800 MHzGSM system, in line with its ongoingnetwork planning activities.

Through all these enhancements andadded services, DiGi’s network hasmaintained stability, thanks to the newnetwork management system referredto as DiNAMICS (or DiGi NetworkAutomated Management InformationControl System). Essentially aperformance management system thatenables the entire network to bemonitored from a single screen,DiNAMICS allows network outages tobe referenced directly to the impacton specific customers and the relevantservice, thus enabling targeted andreal-time maintenance of network

Multimedia (MMS) bagi membolehkanpelanggan DiGi menghantar danmenerima gambar dengan telefonmudah alih mereka menerusirangkaian GPRS DiGi yang sedia ada.

Selepas menerima peruntukan 2 X 2MHz tambahan dalam jalur frekuensiEGSM daripada SuruhanjayaKomunikasi dan Multimedia Malaysia(SKMM), DiGi mula menggunakanfrekuensi tambahan tersebut untukmemperkenalkan sistem dwijalur900MHz dan 1800MHz, sejajardengan kegiatan perancanganrangkaian yang sedang dijalankan.

Dengan segala usaha menaik tarafdan memberikan perkhidmatantambahan ini, rangkaian DiGiberupaya mengekalkan kestabilanmenerusi pelaksanaan sistempengurusan rangkaian baru yangdirujuk sebagai DiNAMICS (atauSistem Kawalan Maklumat PengurusanBerutomasi Rangkaian DiGi). Padaasasnya, DiNAMICS merupakansistem pengurusan prestasi yangmembolehkan seluruh rangkaiandipantau daripada skrin tunggal.


performance. All in all, DiGi managedto increase its network elements by 25% while maintaining its KeyPerformance Indicators, and with nochanges to its workforce.

Mobile CommunicationsServices

Over the year under review, DiGicontinued to offer an exciting, newrange of products and services, settinga number of industry benchmarks forcreativity and innovation. Through aholistic company-wide new brandingexercise, DiGi not only launched anumber of new products and services,but also put significant efforts intoimproving and simplifying all existingproduct and service features, as wellas enhancing our customer servicetouchpoints to ensure efficient andconsistent service to our diversifiedcustomer base.

As in the previous year, DiGimaintained its focus on a seamlessdelivery of mobile communicationsservices, independent of customers’preferred payment mode. This wasreflected in August when DiGi becamethe first mobile operator in Malaysiato launch its Multimedia MessagingServices (MMS) for both prepaid andpostpaid customers. IncorporatingJava-enhanced games, polyphonicring tones, as well as coloured picturesand animations, the service hasalready become very popular, and isbeing used not only for entertainment,but also for professional purposes bybusiness customers.

DiGi has always taken pride inlistening to its customers, andaddressing their expressed needs.There has clearly been a demand forsimplified call price plans in Malaysia,and as consumers vary in their usagepatterns, DiGi was quick to respond

DiNAMICS membolehkan kegagalanrangkaian dirujuk secara langsungkepada kesannya ke atas pelanggan-pelanggan tertentu dan perkhidmatanyang terbabit, lantas membolehkanprestasi rangkaian disenggarakansecara khusus, pada masa sebenar.Secara keseluruhannya, DiGi berjayameningkatkan unsur rangkaiannyasebanyak 25% sambil mengekalkanPetunjuk Prestasi Penting, tanpasebarang perubahan kepada tenagakerjanya.

Perkhidmatan KomunikasiMudah Alih

Sepanjang tahun kewangan yangdilaporkan, DiGi terus menawarkanpilihan produk dan perkhidmatan baruyang menarik dan telah menetapkanbeberapa tanda aras industri dari segikreativiti dan inovasi. Menerusi usahapenjenamaan baru dalam seluruhsyarikat, DiGi bukan sahajamelancarkan beberapa produk danperkhidmatan baru, tetapi jugaberusaha untuk mempermudah danmemperbaiki ciri-ciri semua produkdan perkhidmatan yang sedia ada, disamping memperbaiki perkhidmatanpelanggan di titik-titik perhubunganuntuk menjamin perkhidmatan yangcekap dan konsisten kepada pelbagaipelanggan.

Seperti tahun kewangan lepas, DiGi meneruskan tumpuan untukmenyediakan perkhidmatankomunikasi mudah alih yang lancar,tanpa mengira kaedah pembayaranyang dipilih oleh pelanggan. Ini jelasdilihat pada bulan Ogos, apabila DiGimenjadi pengendali perkhidmatanmudah alih pertama di Malaysia yangmelancarkan Perkhidmatan PesananMultimedia (MMS) bagi pelangganprabayar dan juga pasca bayar.Perkhidmatan tersebut, yang turutmerangkumi permainan yang

...DiGi continued to offer an exciting, new range of productsand services, setting a number of industry benchmarks forcreativity and innovation


dipertingkatkan dengan Java, nadadering polifonik, dan juga gambar dananimasi warna, ternyata sangatpopular dan kini digunakan bukansahaja untuk hiburan, tetapi jugauntuk tujuan profesional olehpelanggan perniagaan.

DiGi sentiasa bersedia mendengarmaklum balas daripada pelanggannya,dan memenuhi segala keperluanmereka. Jelas bahawa terdapatpermintaan bagi pelan hargapanggilan yang lebih ringkas diMalaysia. Memandangkan penggunamempunyai corak penggunaan yangberbeza, DiGi bertindak balas pantasdengan membangunkan teknologipelarasan kadar auto. Ciri pintar inimembolehkan pelanggan menikmatifaedah penjimatan kos apabilapenggunaan mereka meningkat, danDiGi menawarkan kemudahan inikepada semua pelanggan mudahalihnya.

Untuk mempertingkatkan lagikemudahan, DiGi juga meringkaskanzon bayaran di Semenanjung Malaysiatahun ini, dengan mengurangkannyakepada dua zon sahaja, iaitu tempatandan luar negara. Untuk mengukuhkankedudukan kami di Malaysia Timur,kami menjadi pembekal perkhidmatankomunikasi mudah alih pertama yangmenggabungkan sistem bayaran tarifempat zon di Sabah dan Sarawak, dan

Strengthening our presence in East Malaysia, we werealso the first mobile communications service providerto consolidate the four zone tariff charging system inSabah and Sarawak, simplifying the process for ourprepaid customers there and enabling them to enjoygreater cost savings


by developing its innovative autoadjusting rates technology. Thisintelligent feature will enablecustomers to automatically enjoy cost reduction benefits as their usageincreases, and DiGi is now offeringthis to all mobile customers.

Taking convenience a step further,DiGi also simplified the charging zonesin Peninsular Malaysia this year, byreducing them into two zones only,local and outstation. Strengthening ourpresence in East Malaysia, we werealso the first mobile communicationsservice provider to consolidate the fourzone tariff charging system in Sabahand Sarawak, simplifying the processfor our prepaid customers there andenabling them to enjoy greater costsavings.

The practical friends and family™feature was introduced in August toattract new customers and strengthenloyalty. This attractive feature offerslow, flat rates, valid nationwide all daylong to any six DiGi numbers thatcustomers frequently call. For addeduser-friendliness, customers are able toeasily change their registered frequentlycalled numbers by themselves.

With the launch of Beyond™ Prepaidin September, mobile prepaid inMalaysia was taken to newer heights.Incorporating the pioneer autoadjusting rates and the simplifiedcharging zones, together with value-added features like internationalroaming, internet connection viaGPRS, MMS, voice mail, call waiting,call divert and multiparty conferencing,DiGi’s Beyond™ Prepaid has beendelighting both new and existingprepaid customers, meeting theirneeds for convenience, ease of useand affordability.

Reload convenience is very importantto prepaid customers, and DiGi hasconstantly been working on creative

memudahkan proses bagi pelangganprabayar kami di sana. Inimembolehkan mereka menikmaipenjimatan kos yang lebih besar.

Ciri friends and family™ yang praktikaltelah diperkenalkan pada bulan Ogosuntuk menarik pelanggan baru danmeningkatkan kesetiaan pelanggan.Ciri menarik ini menawarkan kadarsekata yang rendah, dan sama diseluruh negara kepada mana-manaenam nombor DiGi yang paling kerapdihubungi. Untuk memudahkan lagipenggunaan, pelanggan bolehmengubah sendiri nombor yang kerapdipanggil dengan mudah.

Dengan pelancaran Beyond™ Prepaidpada bulan September, perkhidmatanprabayar mudah alih di Malaysia kinimencapai tahap baru. Dengan kadarpenyelarasan auto dan zon bayaranlebih ringkas, di samping ciri-ciri nilai tambahan seperti perantauanantarabangsa, sambungan internetmenerusi GPRS, MMS, mel suara,panggilan menunggu, panggilandialihkan dan persidangan berbilangpihak, Beyond™ Prepaid daripada DiGitelah menggembirakan pelangganprabayar yang baru dan sedia ada,dengan menyediakan perkhidmatanyang mudah, senang digunakan dan termampu untuk memenuhikeperluan mereka.

Kesenangan mendapatkan isiansemula amat penting bagi pelangganprabayar, dan DiGi sentiasa mencaricara-cara kreatif untuk menyediakankemudahan yang menyenangkanpelanggan. Kami telah memastikanbahawa kad gores tradisional yangpopular bukan sahaja boleh didapatidi semua gedung wakil penjual, tetapijuga di lokasi yang sering dikunjungipelanggan seperti kedai serbaneka 7-Eleven, stesen minyak, kafe internetdan farmasi utama. DiGi juga telahmembentuk pakatan unik dengansyarikat-syarikat kad kredit seperti


ways to deliver this to our customers.We have ensured that the populartraditional scratch cards are not onlyavailable at all dealer outlets, but alsoat high customer traffic locations suchas 7-Eleven convenience stores, petrolstations, internet cafes and leadingpharmacies. DiGi has also formedunique partnerships with credit cardcompanies like Visa and MasterCardto offer customers auto and ad-hocreload systems, in addition to itsestablished ATM reload network.

Enhancements to DiGi’s postpaidservice helped to further strengthen itsposition in the mobile communicationsmarket. Considerable efforts wereinvested in designing its new Horizon™Postpaid service, which not onlyoffers consumers choice, flexibilityand value for money, but also furtherdiminished the fine lines betweenpre- and post-paid services throughits full set of value-added features.Consequently, Horizon™ Postpaid,which offers a set of two price plans,was well received following its launchin November, as a straightforwardand simple solution for a postpaidservice. The two postpaid plans,Horizon Optimum™ and HorizonPremier™, are tailored to addressdifferent customer needs, easilymaking them the preferred choice ina cluttered and complicated postpaidmarketplace. Both dynamic tariffplans, also utilizing DiGi’s innovativeauto adjusting rates feature, havecaused quite a stir in the mobilearena, as reflected in the increasedmobile customer additions in thissegment since Horizon™ Postpaid’smarket debut.

As a classic example of practicalservice developments provided byDiGi, our customers were the first toenjoy the new PDA Mobile StockTrading solution, popularly known asSJENIE Mobile, an intelligent, mobile

Visa dan MasterCard untuk menawarkansistem isian semula automatik danad-hoc kepada pelanggan, selaindaripada rangkaian isian semulamenerusi ATM yang sedia ada.

Langkah menaik taraf perkhidmatanpasca bayar DiGi juga membantumenguatkan lagi kedudukan kamidalam pasaran komunikasi mudahalih. DiGi telah berusaha denganbersungguh-sungguh untuk merekabentuk perkhidmatan Horizon™Postpaid, yang bukan sahajamenawarkan pilihan, fleksibiliti dannilai untuk wang kepada pengguna,tetapi juga melenyapkan sempadanantara perkhidmatan prabayar danpasca bayar menerusi ciri-ciri lebihnilai yang lengkap. Hasilnya, Horizon™Postpaid yang menawarkan dua pelanharga telah mendapat sambutan baiksebagai penyelesaian yang mudahdan ringkas bagi perkhidmatan pascabayar selepas dilancarkan pada bulanNovember. Dua pelan pasca bayartersebut, iaitu Horizon Optimum™dan Horizon Premier™, disesuaikanuntuk memenuhi keperluan pelangganyang berbeza, menjadikannya pilihanutama dalam pasaran pasca bayaryang rumit dan berpecah. Kedua-duapelan tarif yang dinamik ini dan turutmenggunakan ciri penyelerasan kadarauto DiGi, telah merangsangkan arenaperkhidmatan mudah alih. Ini dapatdilihat daripada pertambahanbilangan pelanggan mudah alih dalamsegmen ini sejak Horizon™ Postpaiddiperkenalkan di pasaran.

Sebagai satu contoh unggulperkhidmatan praktikal yangdisediakan oleh DiGi, para pelanggankami merupakan yang pertamamenikmati Penyelesaian DaganganStok Mudah Alih menerusi PDA, yanglebih dikenali sebagai SJENIE Mobile.Ia merupakan satu sistem daganganstok mudah alih menerusi sambunganWiFi/GPRS. Perkhidmatan inovatif ini


disediakan melalui pakatan kamidengan SJ Securities Sdn Bhd danpembekal IT global utama, Hewlett-Packard Sales (M) Sdn Bhd (HP).SJENIE Mobile dianggap sebagaiperkhidmatan praktikal lebih bernilaiyang cekap dan menjimatkan kos,kerana ia membolehkan pengguna-pengguna dalam industri kewanganmenjalankan urus niaga sambilbergerak.

DiGi sangat gembira dengan sambutanmenggalakkan yang diberikan olehpelanggan terhadap produk danperkhidmatan baru kami pada tahunyang dilaporkan. Khidmat komunikasimudah alih yang ditawarkan danpendekatan perkhidmatan pelangganyang diperbaharui telah mendapatsambutan baik, lantas membolehkanDiGi mendapat ramai pelanggan barudi seluruh negara.

Perkhidmatan Pelanggan

Pada tahun kewangan lepas, DiGitelah melancarkan Pusat InteraksiPelanggan Bersepadu. Pembukaanpusat ini telah membolehkan syarikatmemberi tumpuan kepada perkarayang paling diutamakannya, iaitumenyediakan perkhidmatan pelangganyang bermutu tinggi secara konsisten.Dengan memantapkan pasukanPerkhidmatan Pelanggan menerusipengambilan pekerja baru padaseparuh kedua tahun yang dilaporkan,kami berjaya memenuhi sasaran kamiyang telah ditentukan lebih awal, dan menjelang September, semuaperunding perkhidmatan pelanggantelah menggunakan sistem denganberkesan dan mencapai tahapperkhidmatan pelanggan yangditetapkan.

...DiGi is very pleased withthe encouraging customerresponse to our newproducts and services inthe year under review


stock trading system using WiFi/GPRSconnectivity. This innovative servicewas made possible through ourpartnership with SJ Securities SdnBhd, together with the leading globalIT provider, Hewlett-Packard Sales(M) Sdn Bhd (HP). The service hasbeen hailed as a practical, value-added service which is efficient andcost-effective as it enhances themobile lifestyles of its targetedfinancial community users.

In this respect, DiGi is very pleasedwith the encouraging customerresponse to our new products andservices in the year under review.These mobile communicationsofferings and our revitalized customerservice approach have been very wellreceived, resulting in significantcustomer additions nationwide.

Program Insentif yang diperbaharuidan Program Pembangunan Insanjuga telah membantu meningkatkanprestasi Perkhidmatan Pelanggansecara keseluruhan. Program-program tersebut telah dirangkauntuk meningkatkan kewibawaanpara perunding.

Prestasi lebih baik daripada kakitangan,serta langkah menaik taraf sistemPABX, ACD, CCM, CTI dan POINTyang sedia ada, telah membolehkanDiGi memberikan perkhidmatan yanglebih baik kepada pelanggan.Contohnya, Sistem Pengurusan PusatPanggilan baru (CCMS) membolehkanpanggilan dihalakan berdasarkankepakaran perunding, iaitu panggilandisalurkan kepada perunding yangpaling sesuai. Sistem ini bolehmengendalikan volum panggilan lebihtinggi, dengan fungsi panggilanberlebihan yang fleksibel tetapi tetapmenyediakan perkhidmatan yangbersifat peribadi dan dibezakan.

Teknologi Maklumat

Dalam industri komunikasi mudah alih hari ini yang sangat kompetitif,pembekal perkhidmatan turutmenghadapi cabaran daripada sikappelanggan yang lebih pemilih,peraturan yang berubah dan modelperniagaan yang berkembang. Untukmenangani isu-isu ini, TeknologiMaklumat perlu menyediakan alat danpenyelesaian yang diperlukan olehpembekal perkhidmatan untukmemenuhi keperluan pelanggan,bertindak balas dengan segera dalamsebarang keadaan yang timbul, sambilmengekalkan daya saing dalamindustri.

An improvement in our overallCustomer Service performancecan also be credited to the revisedIncentive Programme, and thePeople Development Programmewhich was embarked upon tostrengthen the competency of theconsultants’ performance


Customer Service

In the last financial year, DiGi sawthe launch of the integrated CustomerInteraction Centre, and with this,successfully focused on the company’smain priority: to provide quality,consistent, customer service.Strengthening the Customer Serviceteam with new recruits in the secondhalf of the year under review, wewere able to effectively meet our pre-determined goals, and by September,all customer service consultants wereutilising the system effectively andmeeting customers’ required servicelevels.

An improvement in our overallCustomer Service performance canalso be credited to the revisedIncentive Programme, and the PeopleDevelopment Programme which wasembarked upon to strengthen thecompetency of the consultants’performance.

This improved staff performance,together with the enhancements madeto the existing PABX, ACD, CCM, CTIand POINT systems, collectivelyenabled DiGi to serve its customersbetter. For instance, the new CallCentre Management System (CCMS)allows skills-based routing - whichidentifies the right consultant to whoma call should be channeled. The system

Justeru itu, DiGi memberi tumpuankepada bidang-bidang IT berikut padatahun kewangan yang dilaporkan:

• Perancangan strategik bagi inisiatif-inisiatif penting, dengan tumpuankepada usaha memaksimumkanjualan

• Memastikan jaminan perkhidmatandan komitmen sokongan dipenuhiapabila membangunkan danmengedarkan produk danperkhidmatan

• Menjamin pengalaman perkhidmatanpelanggan yang positif denganinfrastruktur dan sistem IT yangboleh dipercayai

• Membuat pilihan IT yang strategik,dan memanfaatkan kepakarandalaman untuk menjamin fungsipengeluaran bil dan penarafan yangcekap

• Memperkembangkan infrastrukturpengeluaran bil dan penimbangtaraanuntuk menyokong model-modelperniagaan yang sedang berkembangdan prinsip bayaran baru bagistrategi pengeluaran bil DiGi

• Menyokong Pengurusan HubunganPelanggan (CRM) dengan menganalisistabiat pengguna, dan melaksanakanprogram kesetiaan pelanggan yangberkesan

DiGi memberi tumpuan kepada bidangIT untuk memberikan pengalamanpositif kepada pelanggan. Justeru itu,kami berbangga mengumumkanbahawa sasaran Petunjuk PrestasiPenting (KPI) kami telah dicapai darisegi pengeluaran bil, isian semula danpembatalan sekatan perkhidmatan.

Di samping itu, DiGi memainkanperanan penting untukmempertingkatkan landasan AksesPembekal Kandungan (CPA) denganmeningkatkan keteguhan sistem danmenyokong tahap ketersediaan tinggidan penyepaduan MMS/Protokol


can manage a high surge call volumewith flexible overflow functions whilestill offering personalized anddifferentiated services.

Information Technology

In today’s competitive mobilecommunications industry, serviceproviders are faced with the addedchallenge of more discerningcustomers, a changing regulatorylandscape and evolving businessmodels. To grapple with these,Information Technology (IT) mustprovide the necessary tools andsolutions required by a serviceprovider to meet customer needs,respond in a timely, appropriatefashion to situations, while remainingcompetitive in the industry.

Thus, DiGi focused on the following IT areas for the financial year underreview:

• Strategic planning for key initiatives,giving priority to maximizing sales

• Ensuring service guarantees andsupport commitments are met inproduct and service developmentand distribution

• Ensuring a positive customerservice experience with optimumand reliable IT infrastructure andsystems in place

• Making strategic IT choices, andleveraging on core in-houseexpertise to ensure efficient billingand rating functions

• Evolving the billing and mediationinfrastructure to support evolvingbusiness models and new chargingprinciples of DiGi’s billing strategy

• Supporting Customer RelationshipManagement (CRM) with customerbehavioural analysis, andimplementing effective customerloyalty programmes


Ensuring a positive customerexperience is pivotal to DiGi’s ITfocus, and in this, we are proud toannounce that our Key PerformanceIndicators (KPIs) were met in terms ofbill production, reloads and unbarring.

In addition, DiGi played an importantrole in enhancing the Content ProviderAccess (CPA) platform throughimproving system robustness, and to support high availability andMMS/Wireless Application Protocol(WAP) integration. It also successfullymigrated all prepaid customers to theIntelligent Network (IN) platform.

On the operations front, we havemoved all IT servers and equipmentto the new data centre for improvedinfrastructure support, tighter securitycontrol and to cater for future growth.In supporting its sales and distributionnetwork, the launching of the SalesTracking System has helped to bettermanage DiGi’s distribution channels.

In the year ahead, DiGi will continueto meet the needs of our customerswith the best possible solutionsthrough some of our key ongoing ITinitiatives such as the PrepaidCustomer Loyalty Programme

Aplikasi Tanpa Wayar. DiGi jugaberjaya memindahkan semuapelanggan prabayar kepada landasanRangkaian Pintar (IN).

Di peringkat operasi, kami telahmemindahkan semua pelayan dankelengkapan IT ke pusat data baruuntuk mempertingkatkan sokonganinfrastruktur, menyediakan kawalankeselamatan yang lebih ketat dan memenuhi keperluan untukpertumbuhan masa depan. Dalamusaha menyokong rangkaian jualandan pengedarannya, pelancaranSistem Penjejakan Jualan telahmembantu menguruskan saluranpengedaran DiGi dengan lebih baik.

Pada tahun ini, DiGi akan terusmemenuhi keperluan pelanggan kamidengan menyediakan penyelesaianterbaik melalui beberapa inisiatif ITberterusan kami yang penting, sepertilangkah menaik taraf ProgramKesetiaan Pelanggan Prabayar, MMSInterconnect, CPA-2 dan GerbangPengetahuan Perkhidmatan Pelanggan.Kami berhasrat untuk meningkatkanjualan menerusi kehadiran kami di laman web Internet sebagaisebahagian daripada StrategiSokongan Pengedaran.

Our international business activities have focused mainlyon innovating existing products and services, improvingefficiency by shortening response times and improvingservice quality through network expansion, value-addedand enhancement activities


enhancement, MMS Interconnect,CPA-2 and the Customer ServiceKnowledge Portal. We also hope tofurther increase sales through our webpresence as part of our DistributionSupport Strategy.

International Services

DiGi continued to record growth duringthe year under review, recordingRM235.9 million in total revenue, up 22% from the previous reportingyear. Our international businessactivities have focused mainly oninnovating existing products andservices, improving efficiency byshortening response times andimproving service quality throughnetwork expansion, value-added andenhancement activities. The increaseduse of Voice over Internet Protocol(VoIP) and other IP-based technologieshave also contributed to traffic andrevenue growth.

During the year under review, DiGiforged new partnerships with foreigncorrespondents, to expand connectivityto Bangladesh, Myanmar, Sri Lankaand India. In order to support DiGi’sgrowing global network, the ISC-3underwent an expansion exercise inJune, providing additional capacity,superior network quality anddependability to our customers. Our Malaysian customers were notneglected and DiGi demonstrated itscommitment by working closely withlicensed Application Service Providers(ASPs) to provide them the necessaryinternational connectivity. DiGi’ssuccess in servicing the ASP marketwas proven when it recorded a RM50

Perkhidmatan Antarabangsa

DiGi meneruskan rekodpertumbuhannya pada tahun yangdilaporkan, dengan mencatatkan hasil berjumlah RM235.9 juta, iaitupeningkatan 22% daripada tahunsebelumnya. Kegiatan perniagaanantarabangsa kami tertumputerutamanya kepada usahamempertingkatkan produk danperkhidmatan yang sedia ada,meningkatkan kecekapan denganmemendekkan masa tindak balas,menyediakan kualiti perkhidmatanyang lebih baik menerusiperkembangan rangkaian, danmelaksanakan kegiatan untukmenaikkan taraf dan memberikannilai tambahan. Penggunaan ProtokolSuara Menerusi Internet (VoIP) danteknologi berasaskan IP lain telahmembantu meningkatkanpenggunaan dan hasil.

Pada tahun yang dilaporkan, DiGi telahmembentuk pakatan baru dengansyarikat asing untuk memperluaskanrangkaian ke Bangladesh, Myanmar,Sri Lanka dan India. Untuk menyokongrangkaian global DiGi yang semakinluas, ISC-3 telah dipertingkatkan padabulan Jun untuk memberikan kapasititambahan, kualiti rangkaian lebihunggul dan tahap kebolehpercayaanlebih tinggi kepada pelanggan kami.Para pelanggan kami di Malaysia tidakdiabaikan dan DiGi membuktikankomitmennya apabila kami bergandingbahu dengan Pembekal PerkhidmatanAplikasi (ASP) untuk menyediakansambungan antarabangsa yangmereka perlukan. Kejayaan DiGimenawarkan perkhidmatan kepadapasaran ASP jelas terbukti apabila

kami mencatatkan pertumbuhan hasilRM50 juta bagi tahun yang dilaporkan,lantas membekalkan DiGi sumber lalu lintas IDD keluar alternatif yangberdaya maju.

Sementara itu, melalui kadar panggilanyang berpatutan dan perkhidmatansuara yang bermutu tinggi, produkchatz™ terus mengekalkan bahagianpasaran dalam pasaran kad panggilanIDD yang kompetitif. Pada tahun yang dilaporkan, perkhidmatan chatz™ telah dipertingkatkan denganmemperkenalkan kemudahan‘Articulate”, yang membolehkanpelanggan membeli dan mengisi semulachatz™ dengan hanya membuat satupanggilan. Sementara itu, menerusiperkhidmatan nilai tambahan daripada‘Planetunes’, chatz™ menjadi kadpanggilan IDD prabayar pertamayang menawarkan kemudahan muatturun nada dering dan ciri dedikasikepada pengguna.

Kakitangan

DiGi telah memperbaharui wajahnyapada tahun kewangan yang dilaporkan,dalam langkah penjenamaan strategikyang baru. Proses ini bukan setakatperubahan wajah semata-mata tetapijuga merangkumi usaha yang khususdan tertumpu, membabitkan setiapjabatan, setiap individu dan segalayang menggunakan nama DiGi, baiklaman web mahupun iklan, untukmewujudkan sentuhan dan suarabersepadu, bagi menyediakanpengalaman pelanggan yang seiringdengan janji jenama DiGi.

Semua kakitangan DiGi telah diterapkandengan nilai-nilai teras yang menjadiasas janji jenama baru DiGi. Syarikattelah berusaha dan meluangkanbanyak masa untuk menanamkan


million growth in revenue from thelast reporting year, providing DiGiwith a viable alternative source ofoutbound IDD traffic.

Meanwhile, through attractive callrates and premium voice qualityservices, the chatz™ product continuedto maintain its market share in theincreasingly competitive IDD callingcard market. In the year underreview, the chatz™ service was given a boost with the introduction of the“Articulate” feature, which allowscustomers the convenience ofpurchasing and reloading chatz™through a simple phone call. With the addition of value-added serviceprovider ‘Planetunes’, DiGi’s chatz™became the first IDD prepaid callingcard service to offer users ringtonedownloads and dedication services.

Employees

DiGi took on a brand new look andfeel over the span of the financialyear under review, in a strategic newbranding exercise. This was not merelya superficial makeover, but a concertedand targeted effort involving everydepartment, every individual, andeverything with DiGi’s name on it, fromits website to its advertisements, tohave a united feel or voice, towardscreating a customer experience insync with DiGi’s brand promise.

All DiGi’s employees were realignedto strongly identify and internalise thecore values which form the basis ofDiGi’s new brand promise. Much timeand effort was invested in instillingthese values internally to communicatethe key message that in order forDiGi’s employees to serve theircustomers effectively, they must firstequip themselves as the best in thebusiness. In tandem with this, DiGialso embarked on a comprehensivejourney to forge a strong DiGiemployee culture, built around acommon aspiration towards takingthe company to new levels ofexcellence. Complementing theseefforts, the professional developmentof staff remained an area of priority,with systematic training programmesintroduced to address the trainingneeds of employees across all ranks.

Future Plans

DiGi is well-positioned to further growand maintain its core businesses,through the strategic direction andplans that have been put in placeover the year under review. In thecontext of practical innovation, itsenhanced brand positioning, consistentmarket-leading product and serviceinnovations are clearly the keystonesthat will enable it to boldly leap forwardinto the challenging year ahead.

nilai-nilai ini di kalangan kakitanganuntuk menyampaikan pesanan pentingbahawa kakitangan DiGi mestimelengkapkan diri mereka untukmenjadi yang terbaik dalam bidangini bagi menyediakan perkhidmatanyang berkesan kepada pelanggan.Untuk mencapai matlamat ini, DiGijuga melaksanakan usaha menyeluruhuntuk mewujudkan budaya yangkukuh di kalangan kakitangan DiGi,yang diilhamkan berdasarkan cita-citabersama untuk membawa syarikat ke puncak kecemerlangan. Untukmenyokong inisiatif ini, pembangunanprofesional kakitangan tetap diberikeutamaan, menerusi program-program latihan sistematik untukmemenuhi keperluan latihankakitangan dari pelbagai peringkat.

Rancangan Masa Depan

DiGi mempunyai kedudukan yangbaik untuk memperkembang danmengekalkan perniagaan terasnya,menerusi rancangan dan hala tujustrategik yang telah dirangkasepanjang tahun yang dilaporkan.Dalam konteks inovasi praktikal,kedudukan jenamanya yang lebihbaik, produk konsisten yangmenerajui pasaran dan inovasiperkhidmatan yang jelas menjadifaktor-faktor penting yangmembolehkannya mengorak langkahdengan berani untuk menghadapitahun yang mencabar.

...a concerted and targeted effort involving everydepartment, every individual, and everything with DiGi’sname on it, from its website to its advertisements, to havea united feel or voice, towards creating a customerexperience in sync with DiGi’s brand promise


We will continue to look at growingour customer base through deliveringmore voice- and data-driven mobilecommunications products and servicesthat are of clear relevance to oursubscribers. DiGi’s cost-effectivesolutions, aimed at simplifying andenriching the lives of the mobileconsumer, have an unmistakeablemarket appeal amidst a multitude of market offerings because of theirsimple, straightforward and user-friendly focus. This clear point ofdifferentiation will also be reinforcedthrough DiGi’s commitment to giveour customers advanced yet practicaland affordable mobile multimediaservices.

Alongside this, we recognise thatenhanced network functionality iscentral to providing an enhancedcustomer experience. As such, we will continue to invest in deliveringconsistent network quality andaggressively expanding DiGi’scoverage to new market centres inPeninsular and East Malaysia. DiGiwill also continue to optimize itsnetwork capabilities throughcapitalizing on its available andenhanced bandwidth to delivergreater mobility, speed and clarity to its mobile communicationscustomers. Beginning with its KlangValley network, DiGi has successfullydelivered on its commitment to

Kami akan terus berusahameningkatkan bilangan pelanggandengan menyediakan produk danperkhidmatan komunikasi suara dan data mudah alih yang bermaknabagi pelanggan kami. PenyelesaianDiGi untuk menjimatkan kos yangbertujuan memperbaiki danmenyenangkan kehidupan penggunaperkhidmatan mudah alih ternyatamempunyai daya tarikan tersendiri ditengah-tengah pelbagai perkhidmatanyang ditawarkan di pasaran kerana iamudah, ringkas dan mesra pengguna.Faktor pembeza yang jelas ini jugadiperkukuhkan lagi menerusikomitmen DiGi untuk menyediakanperkhidmatan multimedia mudah alih yang praktikal dan termampukepada pelanggan.

Sementara itu, kami juga sedarbahawa fungsi rangkaian yang lebihbaik penting untuk memberikanpengalaman lebih baik kepadapelanggan. Justeru itu kami akanterus membekalkan kualiti rangkaianyang konsisten dan memperluaskanliputan DiGi secara agresif ke pusat-pusat pasaran baru di Semenanjungdan Malaysia Timur. DiGi juga akanterus mengoptimumkan kemampuanrangkaian dengan menggunakanlebar jalurnya yang sedia ada dandipertingkatkan untuk menyediakandaya pergerakan, kepantasan dantahap kejelasan yang lebih tinggikepada pelanggan perkhidmatankomunikasi mudah alih. Bermuladengan rangkaiannya di Lembah Klang,DiGi telah berjaya melaksanakankomitmen untuk menyempurnakanproses menaik taraf kepada teknologiEDGE. Memandangkan teknologi ini

...we recognise that enhanced network functionality iscentral to providing an enhanced customer experience


boleh digunakan secara komersil buatpertama kali di Malaysia dan rantauAsia Pasifik, Kumpulan yakin bahawaia sekali lagi menjadi pendahuludengan mempelopori perpindahankepada perkhidmatan generasi akandatang di negara ini. Di sampingmelaksanakan segala yang telahdirancang, DiGi akan terus memberitumpuan kepada usaha menjimatkankos dengan membuat pelaburan bijakdan meningkatkan kecekapan operasiserta daya saing bagi menjaminkeuntungan berterusan.

complete its EDGE technologyupgrade, and with the technologycommercially available for the firsttime in Malaysia and the Asia-Pacificregion, the Group is confident that itwill once again have the first-moverlead in the nation’s migration to next-generation services. In all ofthis, DiGi will remain focused onimproving its cost-effectivenessthrough prudent investment andimproving operational efficiency tosignificantly sharpen our competitiveedge and ensure continued profitability.



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Corporate Social Responsibility

DiGi Yellow Mobile communityprogramme, which reaches out tounderprivileged and disadvantagedchildren in Malaysia, has a strongaccent on art and culture


Creating value for the communitywe operate in is a key part ofDiGi’s mission and values. Weinspire, challenge and empowerour people to make a positivecontribution to the communitythrough a variety of creative ofCorporate Social Responsibilityprogrammes implementedthroughout the year.

Our DiGi Yellow Mobilecommunity programme, whichreaches out to underprivileged and disadvantaged children inMalaysia, has a strong accent on art and culture. It celebratesMalaysia’s rich cultural heritage in a unique learning experiencewhich allows the children fromdifferent ethnic backgrounds tointeract with each other throughworkshops and performancesincorporating art, dance, music,literature, craft, and festivetraditions.

So far, more than 1,000 orphansacross the nation have participated inthe programme, which has gained akeen media following since its launchin Kuala Lumpur in mid-June 2002,with Art Attack. During the reviewyear, the DiGi Yellow Mobile journeycontinued with Craft Crazy, CultureCaravan, Festive Fiesta, Sing Swing,touching the lives of special childrenin vulnerable communities inSarawak, Sabah, Penang and Malaccarespectively, and delighting them in the beauty and richness of theircultural heritage and identity. Thiscommunity project reflects DiGi’svision for unity in a diverse cultureand aims to give special children achance for individual expression, aswell as to participate and learn in aharmonious environment with otherchildren and adults.

This communityproject reflects DiGi’svision for unity in adiverse culture andaims to give specialchildren a chance forindividual expression,as well as to participateand learn in a harmoniousenvironment with otherchildren and adults


In the year under review, DiGi’s Customer Service Divisiontook service ethics and corporatesocial responsibility many notcheshigher when they responded to the needs of some 120 orphans byfulfilling their Christmas wishes. In a unique community outreachproject, DiGi’s 12 Trees of Christmas,DiGi Customer Service volunteersworked with 12 orphanages in theKlang Valley, to create Christmas joy at the Berjaya Times Square inKuala Lumpur. The special childrenwere thrilled to be an integral partof the Customer Service teams whohelped to decorate the Christmastrees in a variety of colourful themes.Each decorated tree was thenauctioned off to raise funds for thevarious homes.

Following through on itseducational stance with the youthsegment, DiGi also organised itssecond D-Mobile Youth Workshop in August, providing 200 youth witha highly creative and interactiveenvironment to enable them to understand the full potential of upcoming mobile multimediaapplications and services. Thecreative workshop sessions alsoopened up discussions for youth to explore ways in which they can use these new applications toimprove the way they communicate,work and play.


In the year under review,DiGi’s customer servicedivis ion took serviceethics and corporatesocial responsibility manynotches higher when theyresponded to the needsof some 120 orphans byfulfilling their christmaswishes

we save costs, we minimise wastage, we protect our relationships

We believe in injecting

professionalism and

integrity into everything we

do. By being focused and

getting it right each time,

with one another

and best of all, we give our customers

just what they ask for!

Directors’ Report for the year ended 31 December 2003

The Directors have pleasure in submitting their report and the audited financial statements ofthe Group and of the Company for the year ended 31 December 2003.

Principal activities

The Company is principally engaged in investment holding, whilst the principal activities of thesubsidiaries are as stated in Note 5 to the financial statements. There has been no significantchange in the nature of these activities during the financial year.

Results

Group Company

RM’000 RM’000

Net profit/(loss) for the year 142,223 (390)

Reserves and provisions

There were no material transfers to or from reserves and provisions during the year.

Dividends

No dividend was paid during the year and the Directors do not recommend any dividend to bepaid for the year under review.

Directors of the Company

Directors who served since the date of the last report are:

Tan Sri Dato’ Seri Vincent Tan Chee YiounArve Johansen Tun Dato’ Seri Dr. Lim Chong Eu Ole Bjorn SjulstadDato’ Ab. Halim Bin Mohyiddin Per Olav Fosse Gunnar Johan Bertelsen (appointed on 18.2.2004)Chan Kien Sing (Alternate Director to Tan Sri Dato’ Seri Vincent Tan Chee Yioun)Thor Asbjorn Halvorsen (Alternate Director to Arve Johansen and Per Olav Fosse)Sigve Brekke (resigned on 18.2.2004)Gunnar Johan Bertelsen (ceased as Alternate Director to Sigve Brekke and Ole Bjorn Sjulstad on 18.2.2004)



Directors’ interests

According to the Register of Directors’ Shareholdings, the interests of Directors in office at the endof the financial year in the shares of the Company and its related corporations are as follows:

Number of Ordinary Shares of RM1.00 eachAt At

1.1.2003 Acquired Disposed 31.12.2003

The CompanyDirect interests

Tan Sri Dato’ Seri Vincent Tan Chee Yioun 70,116,237 3,688,000 (20,000,000) 53,804,237Indirect interests

Tan Sri Dato’ Seri Vincent Tan Chee Yioun 84,937,387 1,361,700 (2,500,000) 83,799,087

Number of Ordinary Shares of NOK6 eachAt 1.1.2003/

*Date ofappointment At

on 20.2.2003 Acquired Disposed 31.12.2003

Ultimate holding companyTelenor ASADirect interests

Arve Johansen 24,556 235 - 24,791Ole Bjorn Sjulstad 825 176 - 1,001Sigve Brekke - 1,870 (1,800) 70Per Olav Fosse 3,536* 235 - 3,771Thor Asbjorn Halvorsen 1,651* 235 - 1,886

Number of Options over Ordinary Shares of NOK6 eachAt 1.1.2003/

*Date ofappointment At

on 20.2.2003 Granted Exercised 31.12.2003

Ultimate holding companyTelenor ASA

Arve Johansen 100,000 100,000 - 200,000Ole Bjorn Sjulstad - 10,000 - 10,000Per Olav Fosse 10,000* - - 10,000Thor Asbjorn Halvorsen 85,000* - - 85,000

By virtue of his interests in the shares of the Company shown above, Tan Sri Dato’ Seri VincentTan Chee Yioun is deemed to be interested in the shares of the subsidiaries (as set out in Note 5 tothe financial statements) to the extent the Company has an interest.

None of the other Directors holding office at 31 December 2003 had any interest in the shares ofthe Company and its related corporations during the year.


Directors’ benefits

Since the end of the previous financial year, no Director of the Company has received norbecome entitled to receive any benefit (other than a benefit included in the aggregate amountof emoluments received or due and receivable by Directors as shown in the financial statementsor the fixed salary of a full time employee of related corporations) by reason of a contract madeby the Company or a related corporation with the Director or with a firm of which the Director isa member, or with a company in which the Director has a substantial financial interest, otherthan those in the normal course of business as disclosed in Note 24 to the financial statements.

There were no arrangements during and at the end of the financial year which had the object ofenabling Directors of the Company to acquire benefits by means of the acquisition of shares inor debentures of the Company or any other body corporate.

Issue of shares and debentures

There were no changes in the issued and paid-up capital of the Company during the financial year.

Options granted over unissued shares

No options were granted to any person to take up unissued shares of the Company during theyear.

Other statutory information

Before the financial statements of the Group and of the Company were made out, the Directorstook reasonable steps to ascertain that:

i) all known bad debts have been written off and adequate provision made for doubtful debts,and

ii) all current assets have been stated at the lower of cost and net realisable value.

At the date of this report, the Directors are not aware of any circumstances:

i) that would render the amount written off for bad debts, or the amount of the provision fordoubtful debts, in the financial statements of the Group and of the Company inadequate toany substantial extent, or

ii) that would render the value attributed to the current assets in the financial statements of theGroup and of the Company misleading, or

iii) which have arisen which render adherence to the existing method of valuation of assets orliabilities of the Group and of the Company misleading or inappropriate, or

iv) not otherwise dealt with in this report or the financial statements, that would render anyamount stated in the financial statements of the Group and of the Company misleading.



At the date of this report, there does not exist:

i) any charge on the assets of the Group or of the Company that has arisen since the end ofthe financial year and which secures the liabilities of any other person, or

ii) any contingent liability in respect of the Group or of the Company that has arisen since theend of the financial year.

No contingent liability or other liability of any company in the Group has become enforceable, oris likely to become enforceable within the period of twelve months after the end of the financialyear which, in the opinion of the Directors, will or may substantially affect the ability of theGroup and of the Company to meet their obligations as and when they fall due.

In the opinion of the Directors, the results of the operations of the Group and of the Companyfor the financial year ended 31 December 2003 have not been substantially affected by anyitem, transaction or event of a material and unusual nature nor has any such item, transactionor event occurred in the interval between the end of that financial year and the date of thisreport.

Auditors

The auditors, Messrs KPMG, have indicated their willingness to accept re-appointment.

Signed in accordance with a resolution of the Directors:

Tan Sri Dato’ Seri Vincent Tan Chee YiounDirector

Ole Bjorn SjulstadDirector

Date: 18 March 2004



In the opinion of the Directors, the financial statements set out on pages 112 to 145 are drawnup in accordance with the provisions of the Companies Act, 1965 and applicable approvedaccounting standards in Malaysia so as to give a true and fair view of the state of affairs of theGroup and of the Company at 31 December 2003 and of the results of their operations and cashflows for the year ended on that date.

Signed in accordance with a resolution of the Directors:

Tan Sri Dato’ Seri Vincent Tan Chee YiounDirector

Ole Bjorn SjulstadDirector

Date: 18 March 2004

Statutory Declaration pursuant toSection 169(16) of the Companies Act, 1965

I, Ho Meng, the officer primarily responsible for the financial management of DiGi.Com Berhad,do solemnly and sincerely declare that the financial statements set out on pages 112 to 145are, to the best of my knowledge and belief, correct and I make this solemn declarationconscientiously believing the same to be true, and by virtue of the provisions of the StatutoryDeclarations Act, 1960.

Subscribed and solemnly declared by the abovenamed in Kuala Lumpur on 18 March 2004.

Ho Meng

Before me:

Commissioner for OathsSoh Ah KauLicence No. W315Kuala Lumpur

Statement by Directors pursuant to Section 169 (15) of the Companies Act, 1965


We have audited the financial statements set out on pages 112 to 145. The preparation of thefinancial statements is the responsibility of the Company’s Directors. Our responsibility is toexpress an opinion on the financial statements based on our audit.

We conducted our audit in accordance with approved Standards on Auditing in Malaysia. Thesestandards require that we plan and perform the audit to obtain all the information and explanationswhich we consider necessary to provide us with evidence to give reasonable assurance that thefinancial statements are free of material misstatement. An audit includes examining, on a testbasis, evidence relevant to the amounts and disclosures in the financial statements. An auditalso includes an assessment of the accounting principles used and significant estimates made bythe Directors as well as evaluating the overall adequacy of the presentation of information in thefinancial statements. We believe our audit provides a reasonable basis for our opinion.

In our opinion:

(a) the financial statements are properly drawn up in accordance with the provisions of theCompanies Act, 1965 and applicable approved accounting standards in Malaysia so as togive a true and fair view of:

i) the state of affairs of the Group and of the Company at 31 December 2003 and theresults of their operations and cash flows for the year ended on that date; and

ii) the matters required by Section 169 of the Companies Act, 1965 to be dealt with in thefinancial statements of the Group and of the Company; and

(b) the accounting and other records and the registers required by the Companies Act, 1965 tobe kept by the Company and its subsidiaries have been properly kept in accordance with theprovisions of the said Act.

We are satisfied that the financial statements of the subsidiaries that have been consolidatedwith the Company’s financial statements are in form and content appropriate and proper for thepurposes of the preparation of the consolidated financial statements and we have receivedsatisfactory information and explanations required by us for those purposes.

The audit reports on the financial statements of the subsidiaries were not subject to any qualificationand did not include any comment made under subsection (3) of Section 174 of the Act.

KPMGFirm Number: AF 0758Chartered Accountants

Khaw Hock HoePartnerApproval Number: 2229/04/04(J)

Kuala Lumpur,Date: 18 March 2004

Report of the auditors to the members of DiGi.Com Berhad


Balance Sheets at 31 December 2003

Group CompanyNote 2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

Property, plant and equipment 2 2,629,501 2,494,506 - - Intangible asset 3 43,022 46,963 - - Deferred expenditure 4 35,674 43,265 - - Investments in subsidiaries 5 - - 526,501 526,501Amount due from a subsidiary 6 - - 574,091 574,495

2,708,197 2,584,734 1,100,592 1,100,996

Current assetsInventories 7 14,066 11,101 - -Trade and other receivables 8 186,653 167,010 5 5 Cash and cash equivalents 9 338,516 245,672 - -

539,235 423,783 5 5

Current liabilitiesTrade and other payables 10 712,015 664,606 186 200Deferred revenue 123,611 104,443 - -Borrowings 11 201,933 106,138 - -

1,037,559 875,187 186 200

Net current liabilities (498,324) (451,404) (181) (195)

2,209,873 2,133,330 1,100,411 1,100,801

Financed by:Capital and reserves

Share capital 12 750,000 750,000 750,000 750,000Reserves 709,838 567,615 350,411 350,801

Shareholders’ funds 1,459,838 1,317,615 1,100,411 1,100,801Long term liabilities

Borrowings 11 679,853 805,441 - - Deferred tax liabilities 13 67,196 7,900 - - Employee benefits 14 2,986 2,374 - -

2,209,873 2,133,330 1,100,411 1,100,801

The financial statements were approved and authorised for issue by the Board of Directors on 18March 2004.

The notes set out on pages 117 to 145 form an integral part of, and should be read in conjunctionwith, these financial statements.


Income Statements for the year ended 31 December 2003

Group CompanyNote 2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

Revenue 1,713,529 1,289,564 - -Other operating income 1,919 4,428 - -Staff costs (96,452) (85,004) - -Depreciation expense and impairment

losses 2 (426,490) (276,992) - -Amortisation expense (4,016) (4,016) - -Operating expenses (920,093) (723,524) (390) (369)

Operating profit/(loss) 15 268,397 204,456 (390) (369)Financing costs 16 (74,507) (62,937) - -Interest income 7,646 4,251 - -

Profit/(loss) before taxation 201,536 145,770 (390) (369)Tax expense 17 (59,313) (44,900) - -

Net profit/(loss) for the year 142,223 100,870 (390) (369)

Earnings per ordinary share (sen) 18 19.0 13.4

Dividend per ordinary share (sen) - -



Statements of Changes in Equity for the year ended 31 December 2003

Non-Distributable Distributable

RetainedProfits/

Share Share (Accumulatedcapital premium losses) Total

Group RM’000 RM’000 RM’000 RM’000

At 1 January 2002 750,000 352,651 114,094 1,216,745Net profit for the year - - 100,870 100,870

At 31 December 2002 750,000 352,651 214,964 1,317,615Net profit for the year - - 142,223 142,223

At 31 December 2003 750,000 352,651 357,187 1,459,838

Note 12

Company

At 1 January 2002 750,000 352,651 (1,481) 1,101,170Net loss for the year - - (369) (369)

At 31 December 2002 750,000 352,651 (1,850) 1,100,801Net loss for the year - - (390) (390)

At 31 December 2003 750,000 352,651 (2,240) 1,100,411

Note 12



Cash Flow Statements for the year ended 31 December 2003

Group Company2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

Cash flows from operating activitiesProfit/(Loss) before taxation 201,536 145,770 (390) (369)Adjustments for:

Depreciation expense 416,990 276,992 - -Impairment losses on property, plant

and equipment 9,500 - - -Amortisation of intangible asset 3,941 3,941 - -Amortisation of deferred expenditure 14,015 6,708 - -Interest expense 54,695 54,731 - -Interest income (7,646) (4,251) - -(Gain)/Loss on disposal of property,

plant and equipment (21) 271 - -Unrealised foreign exchange loss 1,639 304 - -Property, plant and equipment

written off - 45 - -Employee benefits expense 640 2,412 - -

Operating profit/(loss) before workingcapital changes 695,289 486,923 (390) (369)

Changes in working capital:Inventories (2,965) 2,936 - -Trade and other receivables (21,323) (12,050) - (5)Trade and other payables 64,242 296,464 (14) (56)Deferred revenue 19,168 39,424 - -

Cash generated from/(used in)operations 754,411 813,697 (404) (430)

Interest paid (71,528) (46,830) - -Increase in deferred expenditure (6,424) (32,467) - -Employee benefits paid (28) (38) - -Taxation paid (17) - - -

Net cash generated from/(used in) operating activities 676,414 734,362 (404) (430)


Cash Flow Statements for the year ended 31 December 2003

(continued)

Group Company2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

Cash flows from investing activitiesPurchase of property, plant and

equipment (562,814) (794,506) - -Amount due from a subsidiary - - 404 430Interest income received 7,687 4,189 - -Proceeds from disposal of property,

plant and equipment 1,350 741 - -

Net cash (used in)/generated from investing activities (553,777) (789,576) 404 430

Cash flows from financing activitiesProceeds from bank borrowings 90,231 192,623 - -Repayment of bank borrowings (120,024) (49,400) - -

Net cash (used in)/generated from financing activities (29,793) 143,223 - -

Net increase in cash and cash equivalents 92,844 88,009 - -

Cash and cash equivalents at beginning of year 245,672 157,663 - -

Cash and cash equivalents at end of year (Note 9) 338,516 245,672 - -



1. Summary of significant accounting policies

The following accounting policies are adopted by the Group and the Company and areconsistent with those adopted in previous financial years except for the retrospectiveadoption of the following:

i) MASB 25, Income Taxes;

ii) MASB 27, Borrowing Costs; and

iii) MASB 29, Employee Benefits.

Apart from the new policies and extended disclosures where required by these new standards,there is no material impact on the financial statements.

(a) Basis of accounting

The financial statements of the Group and of the Company are prepared on the historicalcost basis except as disclosed in the notes to the financial statements and in compliancewith the provisions of the Companies Act, 1965 and applicable approved accountingstandards in Malaysia.

(b) Basis of consolidation

Subsidiaries are those enterprises controlled by the Company. Control exists when theCompany has the power, directly or indirectly, to govern the financial and operatingpolicies of an enterprise so as to obtain benefits from its activities. The financialstatements of subsidiaries are included in the consolidated financial statements from thedate that control effectively commences until the date that control effectively ceases.Subsidiaries are consolidated using the acquisition method of accounting.

Under the acquisition method of accounting, the results of subsidiaries acquired ordisposed are included from the date of acquisition or up to the date of disposal. At thedate of acquisition, the fair values of the subsidiaries’ net assets are determined andthese values are reflected in the Group financial statements. The difference between theacquisition cost and the fair values of the subsidiaries’ net assets is reflected as goodwillor reserve on consolidation as appropriate.

Intragroup transactions and balances and the resulting unrealised profits are eliminatedon consolidation. Unrealised losses resulting from intragroup transactions are alsoeliminated unless cost cannot be recovered.

Notes to the Financial Statements 31 December 2003



1. Summary of significant accounting policies (continued)

(c) Property, plant and equipment

Property, plant and equipment, except for freehold land and capital work-in-progress, arestated at cost less accumulated depreciation and impairment losses. Freehold land andcapital work-in-progress are stated at cost.

Depreciation

Freehold land and capital work-in-progress are not depreciated. All other assets aredepreciated on a straight-line basis over their estimated useful lives except for leaseholdland and buildings which are amortised over their remaining leasehold period.

The principal annual rates used are as follows:

Leasehold land and buildings 30 to 99 yearsFreehold buildings 2.0%Motor vehicles 20.0%Computer systems 20.0%Furniture and fittings 10.0%Telecommunications network 10.0%

(d) Investments in subsidiaries

Investments in subsidiaries are held for long term and are stated at cost. Such investmentsare only written down when the Directors are of the opinion that there is a diminution intheir values which is other than temporary.

(e) Capitalisation of borrowing costs

Interest incurred in connection with financing the construction and installation of property,plant and equipment, if any, is capitalised until the assets are ready for their intended use.



(f) Impairment

The carrying amount of assets, other than inventories and financial assets (other thaninvestment in subsidiaries), are reviewed at each balance sheet date to determinewhether there is any indication of impairment. If any such indication exists, the asset’srecoverable amount is estimated. An impairment loss is recognised whenever thecarrying amount of an asset or the cash-generating unit to which it belongs exceeds itsrecoverable amount. Impairment losses are recognised in the income statement.

The recoverable amount is the greater of the asset’s net selling price and its value inuse. In assessing value in use, estimated future cash flows are discounted to theirpresent value using a pre-tax discount rate that reflects current market assessments ofthe time value of money and the risks specific to the asset. For an asset that does notgenerate largely independent cash inflows, the recoverable amount is determined forthe cash-generating unit to which the asset belongs.

An impairment loss is reversed if there has been a change in the estimates used todetermine the recoverable amount.

An impairment loss is reversed only to the extent that the asset’s carrying amount doesnot exceed the carrying amount that would have determined, net of depreciation oramortisation, if no impairment loss has been recognised. The reversal is recognised inthe income statement.

(g) Inventories

Inventories are stated at the lower of cost and net realisable value and are determinedon a weighted average basis. The costs of trading merchandise comprises purchasecosts and other incidental costs incurred in bringing these merchandise to their presentcondition and location.

(h) Cash and cash equivalents

Cash and cash equivalents consists of cash in hand, balances and deposits with licensedbanks and financial institutions. For the purpose of the cash flow statements, cash andcash equivalents are presented net of bank overdrafts, if any.





(i) Income tax

Tax on the profit or loss for the year comprises current and deferred tax. Income tax isrecognised in the income statement except to the extent that it relates to itemsrecognised directly in equity, in which case it is recognised in equity.

Current tax expense is the expected tax payable on the taxable income for the year,using tax rates enacted or substantially enacted at the balance sheet date, and anyadjustment to tax payable in respect of previous years.

Deferred tax is provided, using the liability method, on temporary differences arisingbetween the tax bases of assets and liabilities and their carrying amounts in the financialstatements. Temporary differences are not recognised for goodwill not deductible for taxpurposes and the initial recognition of assets or liabilities that at the time of the transactionaffects neither accounting nor taxable profit. The amount of deferred tax provided is basedon the expected manner of realisation or settlement of the carrying amount of assets andliabilities, using tax rates enacted or substantially enacted at the balance sheet date.

A deferred tax asset is recognised only to the extent that it is probable that futuretaxable profits will be available against which the asset can be utilised.

(j) Foreign currency

Transactions in foreign currencies are translated into Ringgit Malaysia at ratesapproximating those ruling at the date of the transactions. Monetary assets and liabilitiesdenominated in foreign currencies at balance sheet date are translated into RinggitMalaysia at the foreign exchange rates ruling at that date. Foreign exchange differencesarising from translation are recognised in the income statement.

The closing rates used in the translation of foreign currency monetary assets andliabilities are as follows:

2003 2002

1 US Dollar RM3.80 RM3.801 Swiss Franc RM3.06 RM2.741 Special Drawing Rights RM5.65 RM5.151 Euro Dollar RM4.78 RM3.981 Norwegian Kroner RM0.54 RM0.55



(k) Revenue

i) Goods sold and services rendered

Net revenue include all sales of goods and services, net of rebates and discounts.Revenue are recognised when goods are delivered or services are rendered. Revenuefrom the prepaid cards that have been sold to customers but where services have notbeen rendered at the balance sheet date is deferred.

ii) Interest income

Interest income is recognised in the income statement as it accrues taking intoaccount the effective yield on the asset.

(l) Expenses

i) Operating leases

Leases of assets where a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made underoperating leases (net of any incentives received from the lessor) are charged to theincome statement on the straight line basis over the lease period.

When an operating lease is terminated before the lease period has expired, anypayment required to be made to the lessor by way of penalty is recognised as anexpense in the period in which termination takes place.

ii) Financing costs

All interest and other ancillary costs incurred in connection with borrowings areexpensed as incurred except for those as mentioned in Notes 1(e) and 1(n)(ii).




(m)Intangible asset

Intangible asset comprises a fee paid during the financial period ended 31 December 2001for the provision of technology and transfer of technical know-how pursuant to a technicalservices agreement signed between the Company and Telenor Mobile Communications AS,a wholly owned subsidiary of Telenor ASA, its ultimate holding company.

The fee paid is amortised on a straight line basis over the remaining period of thetelecommunications license of fifteen years.

(n) Deferred expenditure

i) License fees

License fees are capitalised and amortised over the period of the licenses.

ii) Ancillary costs of borrowings

Costs specifically incurred to obtain new funding for the purpose of retiring existingloans and finance further network expansion are deferred to the extent that these arerecoverable out of future revenue.

The costs incurred are amortised over the tenor of the new loans and any unamortisedportion will be written off proportionately as and when there is a prepayment of theoutstanding loans.

(o) Trade and other receivables

Trade and other receivables are stated at cost less allowance for doubtful debts.

Bad debts are written off in the year in which these are identified. Allowances are madefor doubtful debts based on a review of all outstanding balances at the year end.




(p) Employee benefits

i) Defined contribution plans

Obligations for contributions to defined contribution plans are recognised as anexpense in the income statement as incurred.

ii) Defined benefits plans

The Group operates an unfunded defined benefit plan for its eligible employees. Thebenefits are calculated based on the length of service and the agreed percentages ofeligible employees’ salaries over the period of their employment and are payable uponresignation after completion of minimum employment period of 10 years service orupon retirement age of 55 years. The obligations under the retirement benefit schemeare determined based on actuarial valuation by a qualified independent actuary on abi-annual basis. That benefit is calculated using the Projected Unit Credit Method inorder to determine its present value. Actuarial gains and losses are recognised asincome or expense over the expected average remaining working lives of theparticipating employees when cumulative unrecognised actuarial gains or lossesexceed 10% of the higher of the present value of the defined benefit obligation andthe fair value of plan assets. Where there are any improvements in benefits for theplan, past service cost is recognised immediately to the extent that the benefits arealready vested, and otherwise is amortised on a straight-line basis over the averageperiod until the amended benefits become vested.

The amount recognised in the balance sheet represents the present value of thedefined benefit obligations adjusted for unrecognised actuarial gains and losses, ifany, and unrecognised past service cost. Any asset resulting from this calculation islimited to the net total of any unrecognised actuarial losses and past service cost,and the present value of any economic benefits in the form of refunds or reductionsin future contributions to the plan.

(q) Liabilities

Borrowings and trade and other payables are stated at cost.




2. Property, plant and equipment

Long term Short term Freehold leasehold leasehold

Group land and land and land andbuildings buildings buildings

Cost RM’000 RM’000 RM’000

At 1 January 2003 18,858 9,605 14,312Additions - 190 -Written off/Disposals - - -Transfers 515 - 93

At 31 December 2003 19,373 9,795 14,405

Depreciation and impairment losses

Accumulated depreciation 288 539 2,139Accumulated impairment losses - - -At 1 January 2003 288 539 2,139

Depreciation charge for the year 62 100 290Written off/Disposals - - -Impairment losses for the year - - -

Accumulated depreciation 350 639 2,429Accumulated impairment losses - - -At 31 December 2003 350 639 2,429

Net book value

At 31 December 2003 19,023 9,156 11,976

At 31 December 2002 18,570 9,066 12,173

For the year ended31 December 2002Depreciation charge 47 104 297


Motor Computer Furniture Telecommunications Capitalvehicles systems and fittings network work-in-progress TotalRM’000 RM’000 RM’000 RM’000 RM’000 RM’000

14,898 183,492 27,289 2,739,232 231,271 3,238,957827 4,762 295 46,011 510,729 562,814

(1,509) (2,464) (60) (12,699) (262) (16,994)2,494 55,851 1,027 528,804 (588,784) -

16,710 241,641 28,551 3,301,348 152,954 3,784,777

8,590 75,194 13,210 644,491 - 744,451- - - - - -

8,590 75,194 13,210 644,491 - 744,451

1,994 43,044 2,791 368,709 - 416,990(1,394) (2,429) (42) (11,800) - (15,665)

- - - 9,500 - 9,500

9,190 115,809 15,959 1,001,400 - 1,145,776- - - 9,500 - 9,500

9,190 115,809 15,959 1,010,900 - 1,155,276

7,520 125,832 12,592 2,290,448 152,954 2,629,501

6,308 108,298 14,079 2,094,741 231,271 2,494,506

1,624 35,804 2,638 236,478 - 276,992


2. Property, plant and equipment (continued)

Long term leasehold land and buildings comprise leasehold interests with an unexpired term inexcess of 50 years.

No interest was capitalised during the current and previous financial year in respect of theproperty, plant and equipment of the Group.

Property, plant and equipment amounting to RM2.627 billion (2002 - RM2.492 billion) belongingto a subsidiary have been charged to financial and other institutions for credit facilities.

The current year impairment losses represents the subsidiary company Directors’ best estimate of theadjustments required to state certain telecommunication equipment at their net realisable values.

3. Intangible asset

Group2003 2002

RM’000 RM’000

Balance as at 1 January 46,963 50,904Less: Amount amortised during the year (3,941) (3,941)

Balance as at 31 December 43,022 46,963

4. Deferred expenditure

Group2003 2002

RM’000 RM’000

License fees

Balance as at 1 January 743 818 Less: Amount amortised during the year (75) (75)

Balance as at 31 December 668 743

Ancillary costs of borrowings

Balance as at 1 January 42,522 16,688 Add: Amount capitalised during the year 6,424 32,467Less: Amount amortised during the year (Note 16) (13,940) (6,633)

Balance as at 31 December 35,006 42,522

Total deferred expenditure 35,674 43,265



5. Investments in subsidiaries

Company2003 2002

RM’000 RM’000

Unquoted shares, at cost 526,501 526,501

Details of the subsidiary companies, which are incorporated in Malaysia, are as follows:

EffectiveName of Company Principal activity ownership interest

2003 2002% %

DiGi Telecommunications Sdn. Bhd. Establishment, maintenance and 100 100provision of telecommunicationsand related services

Subsidiaries of DiGi Telecommunications Sdn. Bhd.

DiGi Services Sdn. Bhd. Property holding and other 100 100related services

Djuice.Com Sdn. Bhd. Dormant 100 100

6. Amount due from a subsidiary company

Company2003 2002

RM’000 RM’000

Amount due from a subsidiary company 574,091 574,495

The amount due is non-trade, unsecured, interest free and not repayable within the nexttwelve months. In addition, the amount due has been subordinated to the secured lenders ofthe subsidiary company.

7. Inventories

Group2003 2002

RM’000 RM’000

Trading merchandise 14,066 11,101

Included in the trading merchandise balance are those stated at net realisable values ofRM174,000 (2002 - RM176,000).




8. Trade and other receivables

Group Company2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

Trade receivables 145,928 123,734 - -Other receivables,

deposits and prepayments 40,725 43,276 5 5

186,653 167,010 5 5

Trade receivables are stated net of allowance for doubtful debts of RM15.821 million (2002 - RM21.495 million).

During the financial year, the Group had written off approximately RM15.242 million (2002 - RM20.716 million) of trade receivables balance against the allowance for doubtfuldebts balance brought forward.

At 31 December 2003, the Group’s trade receivables balance includes exposure to foreigncurrency denominated in US Dollars amounting to USD12.3 million (2002 - USD7.9 million).

9. Cash and cash equivalents

Group2003 2002

RM’000 RM’000

Deposits placed with:Licensed banks 127,956 -Other licensed financial institutions 201,813 241,568

329,769 241,568Cash and bank balances 8,747 4,104

338,516 245,672



10. Trade and other payables

Group Company2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

Trade payables 50,977 72,527 - -Other payables 131,546 224,793 - -Accruals 526,685 364,244 186 200Customer deposits 2,807 3,042 - -

712,015 664,606 186 200

Included in other payables in the previous financial year is an amount of RM103.0 millionrelating to a creditor for telecommunication equipment purchases which bears interest of8.5% per annum. The balance due to this creditor at 31 December 2003 is RM20.4 million.No interest was charged by this creditor during the current financial year.

At 31 December 2003, the Group’s trade and other payables balances include exposure to foreigncurrency denominated in US Dollars amounting to USD9.4 million (2002 - USD17.5 million).

11. Borrowings

Group2003 2002

RM’000 RM’000

Current:Syndicated term loan 122,863 40,954Term loan (USD65 million) 49,400 49,400Senior secured credit facilities 29,670 15,784

201,933 106,138

Non-current:Syndicated term loan 382,239 505,102 Term loan (USD65 million) 74,100 123,500Senior secured credit facilities 223,514 176,839

679,853 805,441

The syndicated term loan outstanding was part of a syndicated term loan facility of up toRM551.21 million secured by a subsidiary company during the financial year ended 30 April2001 to refinance outstanding borrowings and to finance capital expenditure. This is repayablein eight half yearly unequal instalments over a period of four years which commenced on 31October 2003 and bears interest of between 7.5% to 7.9% (2002 - 7.9% to 8.4%) per annum.



11. Borrowings (continued)

A term loan facility of USD65 million (approximately RM247 million) was obtained during thefinancial period ended 31 December 2001 by the said subsidiary to finance capitalexpenditure. The loan is subject to interest of between 2.4% to 3.1% (2002 - 3.1% to5.0%) per annum and repayable in 10 half yearly instalments of USD6.5 million(approximately RM24.7 million) which commenced on 31 July 2001.

During the previous financial year ended 31 December 2002, the said subsidiary companyhad secured additional syndicated term loan facilities (“senior secured credit facilities”)amounting to approximately RM1.0 billion to finance capital expenditure. Of this, totalamount of approximately RM253.2 million has been drawn down (net of repayments made)as at the end of the current financial year. These loans are subject to interest of between4.0% to 7.9% (2002 - 4.0% to 7.9%) per annum and are repayable in ten to thirteen halfyearly instalments, some of which require unequal instalment payments, and with theirrepayment dates commencing between March 2003 to April 2005.

All the above loans are secured by:

i) A fixed and floating charge over all the assets of a subsidiary company;ii) Corporate guarantee issued by the Company;iii) Pledgement of all the shares of a subsidiary company; andiv) Negative pledge over all the assets of a subsidiary company.

The borrowings of the Group are repayable as follows:

1 to 2 3 to 5Total Current years years

RM’000 RM’000 RM’000 RM’000

Syndicated term loan 505,102 122,863 300,330 81,909Term loan (USD65 million) 123,500 49,400 74,100 -Senior secured credit facilities 253,184 29,670 90,840 132,674

881,786 201,933 465,270 214,583

12. Share capital

Group and Company2003 2002

RM’000 RM’000

Ordinary shares of RM1 each Authorised 1,000,000 1,000,000

Issued and fully paid 750,000 750,000



13. Deferred tax liabilities

The amounts, determined after appropriate offsetting, are as follows:

Group2003 2002

RM’000 RM’000

Deferred tax liabilities 312,105 276,402Deferred tax assets (244,909) (268,502)

67,196 7,900

Deferred tax liabilities and assets above are offset as there is a legally enforceable right toset off current tax assets against current tax liabilities and that the deferred taxes relate tothe same taxation authority.

The components of recognised deferred tax assets and liabilities (before offsetting) are asfollows:

Group 2003 2002

RM’000 RM’000

Property, plant and equipment- capital allowances 309,609 273,650

Unabsorbed capital allowances (177,791) (188,182)Unutilised tax losses (67,118) (80,320)Others 2,496 2,752

67,196 7,900

14. Employee benefits

The defined benefit obligations recognised in the balance sheet are as follow:

Group 2003 2002

RM’000 RM’000

Present value of unfunded obligations 2,986 2,374



14. Employee benefits (continued)

Liability for defined benefit obligations

The Group operates an unfunded defined benefit plan for its eligible employees. Theobligations under the retirement benefit scheme are determined based on actuarial valuationby a qualified independent actuary on a bi-annual basis.

The principal assumptions used in the actuarial valuation are:

a) discount rate of 7% per annum; andb) salary increases of 6% per annum for year ended 31 December 2003 and 8% per annum

thereafter.

Movements in the net liability recognised in the balance sheets

Group2003 2002

RM’000 RM’000

Net liability at 1 January 2,374 -Benefits paid (28) (38)Expense recognised in the income statements 640 2,412

Net liability at 31 December 2,986 2,374

Expense recognised in the income statements

Group2003 2002

RM’000 RM’000

Current service cost 477 446Interest on obligations 163 127Transition amount expensed off - 1,839

Amount included under “staff costs” 640 2,412



15. Operating profit/(loss)

Group Company2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

Operating profit/(loss) is arrived at after charging:

Allowance for doubtful debts 9,568 21,284 - -Amortisation expense of

- intangible asset 3,941 3,941 - -- license fees 75 75 - -

Auditors’ remuneration 79 79 11 11Directors’ emoluments 308 334 72 76Employee benefits

- defined contribution plans 8,389 7,210 - -- defined benefit plans 640 2,412 - -

Impairment losses on property, plant and equipment 9,500 - - -

Lease of transmission facilities 52,969 51,034 - -Loss on disposal of property, plant

and equipment - 271 - -Property, plant and equipment

written off - 45 - -Realised loss on foreign exchange 469 309 - -Rental of equipment 1,235 1,052 - -Rental of land and buildings 48,225 35,209 - -Unrealised loss on foreign exchange 1,639 304 - -

and crediting:Bad debts recovered 1,618 1,701 - - Gain on disposal of property, plant

and equipment 21 - - -

The number of employees of the Group and of the Company at the end of the year was1,450 (2002 - 1,443) and Nil (2002 - Nil), respectively.

16. Financing costsGroup

2003 2002RM’000 RM’000

Interest expense 54,695 54,731 Ancillary costs of borrowings (Note 4) 13,940 6,633Others 5,872 1,573

74,507 62,937



17. Tax expense

Group2003 2002

RM’000 RM’000

Current tax expense- prior year underprovision 17 -

Deferred tax expense- current 62,796 44,900- prior year overprovision (3,500) -

59,313 44,900

Reconciliation of effective tax rate/tax expense

2003 2002Group % RM’000 % RM’000

Profit before taxation 201,536 145,770

Income tax using Malaysian tax rates 28.0 56,430 28.0 40,816Non-deductible expenses 3.3 6,743 2.8 4,150Other items (0.2) (377) - (66)

31.1 62,796 30.8 44,900Underprovision of tax expense in prior year - 17 - -Over provision of deferred tax expense in

prior year (1.7) (3,500) - -

Effective tax rate/Tax expense 29.4 59,313 30.8 44,900

There is no income tax charge for the Group in the current and previous financial year due totax savings of approximately RM185 million (2002 - RM130 million) arising from the utilisationof unabsorbed capital allowances and utilisation of business tax loss by its subsidiary.

2003 2002Company % RM’000 % RM’000

Loss before taxation (390) (369)

Income tax using Malaysian tax rates (28.0) (109) (28.0) (103)Non-deductible expenses 28.0 109 28.0 103

Effective tax rate/Tax expense - - - -



18. Earnings per ordinary share - Group

The calculation of earnings per share is based on the Group’s net profit attributable toordinary shareholders of RM142.2 million (2002 - RM100.8 million) and the weighted averagenumber of ordinary shares outstanding during the year of 750.0 million (2002 -750.0 million).

19. Holding company

The ultimate holding company is Telenor ASA, a company incorporated in Norway andlisted on the Oslo Stock Exchange, Norway and NASDAQ, United States of America.

20. Segmental information

Segment information is presented in respect of the Group’s business and geographicalsegments. The primary reporting format by business segments, is based on the Group’smanagement and internal reporting structure. Inter-segment pricing is determined on anarms’ length basis.

Segment results, assets and liabilities include items directly attributable to a segment aswell as those that can be allocated on a reasonable basis. Unallocated items mainlycomprise interest-earning and corporate assets, interest-bearing loans and generalenterprise expenses.

Segment capital expenditure is the total cost incurred during the year to acquire segmentassets that are expected to be used for more than one year.

Business segments

The Group comprises the following main business segments:

Mobile Provision of mobile communication services to businesses, individuals andother operators through its operating unit, DiGi Telecommunications Sdn Bhd.

International Provision of international gateway network which offers cross borderinterconnection and related services, through its operating unit, DiGiTelecommunications Sdn Bhd.

Geographical segments

The Group’s business segments operate mainly in Malaysia, the home country of theCompany and its operating subsidiary companies. No other individual country contributedmore than 10% of the consolidated revenue and assets.

In presenting information on the basis of geographical segments, segment revenue isbased on the geographical location of customers. Segment assets are also based on thegeographical location of assets.



20. Segmental information (continued)

Mobile InternationalGroup 2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

Business segmentsRevenue from external

customers 1,464,953 1,081,853 235,942 193,464Inter-segment revenue - - - -

Total revenue 1,464,953 1,081,853 235,942 193,464

Segment results 283,254 222,932 25,895 13,931Unallocated expenses

Operating profit Financing costsInterest income

Profit before taxationTax expense

Net profit for the year


Others Eliminations Consolidated2003 2002 2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

12,634 14,247 - - 1,713,529 1,289,5645,784 6,100 (5,784) (6,100) - -

18,418 20,347 (5,784) (6,100) 1,713,529 1,289,564

(8,732) (4,321) - - 300,417 232,542(32,020) (28,086)

268,397 204,456(74,507) (62,937)

7,646 4,251

201,536 145,770 (59,313) (44,900)

142,223 100,870



20. Segmental information (continued)

Mobile InternationalGroup 2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

Segment assets 2,701,532 2,543,215 148,863 146,430Unallocated assets

Total assets

Segment liabilities 752,152 666,746 59,119 72,216Unallocated liabilities

Total liabilities

Capital expenditure 553,283 779,812 8,228 10,268Depreciation, amortisation

and impairment losses 397,231 261,077 19,753 15,817Non-cash expenses other

than depreciation, amortisation and impairment losses 2,142 2,810 111 196

Geographical segments

Revenue from external customersby location of customers

Segment assets by location of assets

Capital expenditure bylocation of assets

+Others comprise customers which are mostly located in Asia region



Others Eliminations Consolidated2003 2002 2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

21,112 28,749 - - 2,871,507 2,718,394375,925 290,123

3,247,432 3,008,517

3,627 4,458 - - 814,898 743,420972,696 947,482

1,787,594 1,690,902

1,303 4,426 - - 562,814 794,506

13,522 4,114 - - 430,506 281,008

5 26 - - 2,258 3,032

Malaysia Others+ Consolidated2003 2002 2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000 RM’000 RM’000

1,557,894 1,131,695 155,635 157,869 1,713,529 1,289,564

3,225,502 2,985,798 21,930 22,719 3,247,432 3,008,517

562,779 793,994 35 512 562,814 794,506


21. Contingent liabilities - secured

Company2003 2002

RM’000 RM’000

Guarantees given by the Company to financial institutionsfor credit facilities granted to its subsidiary 1,411,786 1,738,956

22. Operating leases

Total future minimum lease payments under non-cancellable operating leases are as follows:

Group2003 2002

RM’000 RM’000

Less than one year 19,325 21,056Between one and five years 1,161 10,514

20,486 31,570

Significant operating lease arrangements of the Group include leases for transmission facilitiesand land and buildings to support its telecommunications operations. The tenure of theseleases range between one to nine years, with options to renew. None of the leases includecontingent rentals.

23. Commitments

Group2003 2002

RM’000 RM’000

Capital expenditure commitments:Property, plant and equipment

Authorised and contracted for 109,000 139,000

Authorised but not contracted for 183,000 302,000



24. Related parties

Controlling related party relationships are as follows:

i) The ultimate holding company as disclosed in note 19.

ii) Its subsidiaries as disclosed in note 5.

Significant transactions and balances with related parties of the Group during the year are asfollows:

Transactions Balance duefrom/(to) at

2003 2002 2003 2002RM’000 RM’000 RM’000 RM’000

With the intermediate holding company

- Telenor Mobile Communications ASProfessional and personnel

services rendered 4,534 19,798 (324) (5,712)

With fellow subsidiary companies

- Telenor Global Services ASSales of interconnection services

on international traffic 2,620 5,715 249 1,197Purchase of interconnection services

on international traffic 1,172 1,089 - -

- Telenor Consult ASPersonnel services rendered 3,601 - (666) -

With companies in which a Director of the Company, Tan Sri Dato’ Seri Vincent Tan Chee Yioun has an interest

- Cosway (M) Sdn. Bhd.Sales of reload coupons 6,492 5,869 1,068 1,068

- Convenience Shopping Sdn. Bhd.Sales of reload coupons 16,668 6,438 2,837 813


24. Related parties (continued)

Transactions Balance duefrom/(to) at

2003 2002 2003 2002

RM’000 RM’000 RM’000 RM’000

With companies in which a Director of the Company, Tan Sri Dato’ Seri Vincent Tan Chee Yioun has an interest

- Berjaya General Insurance Bhd.Insurance premiums 6,160 1,725 (52) -

- Berjaya Registration Services Sdn. Bhd.Printing and mailing services 3,494 2,788 (583) (848)

- Pentagon Engineering Sdn. Bhd.Construction of transmission

towers and sites 5,639 - (2,914) -

- MOL AccessPortal Bhd.Sales of reload soft pins 3,260 - 201 -

- Roda Indah Motors Sdn. Bhd.Purchase of motor vehicles 1,648 - (639) -

The transactions above have been entered into in the normal course of business and havebeen established under the terms that are no less favourable than those arranged withindependent third parties.



25. Financial instruments

Financial Risk Management Objectives and Policies

In the normal course of conducting its business activities, the Group is exposed to a varietyof financial risks, which include credit, currency, liquidity and interest rate risk. The Group’soverall risk management programme seeks to minimise potential adverse effects of theserisks on the financial performance of the Group.

Credit risk

The Group’s credit risk arises in the normal course of business primarily with respect totrade and other receivables and cash and cash equivalents. Credit risk is managed throughformalised policies on credit assessment and approvals, credit limits and monitoringprocedures. Deposits are placed only with licensed banks and financial institutions.

The maximum credit risk exposure in respect of trade receivables is limited to the carryingvalue of the receivables less allowance for doubtful debts as stated in the financialstatements, whereas, the maximum exposure for other receivables, cash and cashequivalents are the reported carrying value in the financial statements.

At balance sheet date, there were no significant concentrations of credit risk.

Foreign currency risk

The Group is exposed to foreign currency risk as a result of transactions denominated inforeign currency arising from the normal business activities and borrowings. The currencygiving rise to this risk is primarily US dollars. Exposure to foreign currency risk ismonitored on an ongoing basis and when considered necessary, the Group will considerusing effective financial instruments to hedge its foreign currency risk.

Liquidity risk

The Group monitors and maintains a level of cash and cash equivalents deemed adequateby management to finance the Group’s operations and to mitigate the effects offluctuations in cash flows.

Interest rate risk

The Group is exposed to interest rates risk primarily from the deposit placements andinterest-bearing financial liabilities. The Group manages its interest rate risk for theinterest-earning deposit placements by placing such balances on varying maturities andinterest rate terms.

The Group’s policy in dealing with interest-bearing financial liabilities is to minimise theinterest expense by obtaining the most favourable interest rates available and by using amix of fixed and floating rate debts.



25. Financial instruments (continued)

The effective interest rates and maturity terms of the financial assets and liabilities are as follows:

EffectiveGroup interest Within 1 - 5 After

rate Total 1 year years 5 years2003 % RM’000 RM’000 RM’000 RM’000

Financial assetsDeposits placed with licensed

banks and financial institutions 2.8 329,769 329,769 - -

Financial liabilitiesSyndicated term loan 7.5 505,102 122,863 382,239 -Term loan (USD65 million) 2.4 123,500 49,400 74,100 -Senior secured credit facilities 5.8 253,184 29,670 223,514 -

2002

Financial assetsDeposits placed with licensed

banks and financialinstitutions 2.8 241,568 241,568 - -

Financial liabilitiesOther payables 8.5 103,034 103,034 - -Syndicated term loan 7.9 564,056 40,954 505,102 -Term loan (USD65 million) 3.1 172,900 49,400 123,500 -Senior secured credit facilities 6.1 192,623 15,784 119,386 57,453

Fair value

The following methods and assumptions are used to determine the fair value of each of thefinancial assets or liabilities for which it is practicable to estimate their values:

i) Cash and cash equivalents, other receivables and payables

The carrying values of these amounts approximate their fair values due to their short termnature.

ii) Trade receivables and payables

The carrying values of these amounts approximate their fair values because these aresubject to normal trade credit terms and their short term nature.



25. Financial instruments (continued)

iii) Amount due from a subsidiary

No disclosure of fair value is made for amount due from a subsidiary as it is not practicableto determine its fair value with sufficient reliability given this balance have no fixed termsof repayment.

iv) Borrowings

The fair values of the borrowings carried at the balance sheet date are as below:

Group2003 2003 2002 2002

Carrying Fair Carrying Fairamount value amount valueRM’000 RM’000 RM’000 RM’000

Syndicated term loan 505,102 505,102 546,056 546,056Term loan (USD65 million) 123,500 123,500 172,900 172,900Senior secured credit facilities

- fixed rates 40,000 39,625 40,000 38,800- floating rates 213,184 213,184 152,623 152,623

881,786 881,411 911,579 910,379

The fair value of the senior secured credit facilities, a portion of which was obtained on afixed rate has been determined by discounting the relevant cash flows using current interestrates for similar instruments at the balance sheet date. Apart from this fixed rate loan,the fair values of all the other loans are their carrying amounts as their interest rates areon floating rate basis.



List of Properties as at 31 December 2003

No. Location Tenure

1 H.S. (D) No 92086 & 92087, P.T. No 9 & No.10, FreeholdPekan Seremban Jaya, Daerah Seremban, Negeri Sembilan

2 Unit No 202-4-11, Sri Bandar Besi, FreeholdJalan Sungai Besi, Sungai Besi, Kuala Lumpur

3 Unit No C16-2, Indera Subang UEP, Jalan UEP 6/2L, FreeholdUEP Subang Jaya, Petaling Jaya, Selangor

4 No 1-16.2, 16th Floor, Union Height, Taman Yan, FreeholdJalan Klang Lama , Kuala Lumpur

5 3rd Floor, Unit Pt 4888/4786 C, Block TC-14, FreeholdTaman Sri Gombak, Jalan Batu Caves, Selangor

6 4572, 7th Floor, Sri Jelatek Condominiums, FreeholdSection 10, Wangsa Maju, Kuala Lumpur

7 32 , PLO 151 Jln Angkasa Mas Utama, 30 years leaseKawasan Perindustrian Tebrau II, 81100 Johor Bahru (expiring in 2023)

8 HS (D) 77, No. P.T. PTBM/A/081, Mukim 1, Leasehold 60 yearsKawasan Perusahaan Perai, District Seberang Perai Tengah, Pulau Pinang (expiring in 2033)

9 Lot 36, Sedco Light Industrial Leasehold 60 yearsEstate, Jalan Kelombong, Kota Kinabalu , Sabah (expiring in 2034)

10 Lot 1220, Section 66, Kuching Town Leasehold 60 yearsLand District, Sarawak (expiring in 2036)

11 No 112, Semambu Industrial Estate, Leasehold 66 yearsKuantan, Pahang (expiring in 2041)

12 Unit 16-12-1, 12th Floor, Cloud View Tower, Leasehold 99 yearsTaman Supreme, Cheras, Kuala Lumpur (expiring in 2076)

13 Unit No M803, 8th Floor, Sunrise Park, Leasehold 99 yearsAmpang, Kuala Lumpur (expiring in 2088)

14 Part of Lot PT 11702, HS(D) 10654, Leasehold 99 yearsMukim 1, District Of Bentong, Pahang (expiring in 2091)

15 Plot D-38, Taman Industri Prima Kota Fasa 1 Leasehold 99 yearsSector 3, Bandar Indera Mahkota, Kuantan, Pahang (expiring in 2097)

16 Ptd 1490, Mukim Of Jemaluang Leasehold 99 yearsDistrict Of Mersing, Johor Darul Takzim (expiring in 2098)

17 PN 89926, Lot 191363 Leasehold 90 yearsMukim Hulu Kinta, Daerah Kinta, Negeri Perak (expiring in 2081)

18 Lot No 54, Jalan 6/2, Kawasan Perindustrian Seri Kembangan, Leasehold 99 years 43000 Seri Kembangan, Selangor (expiring in 2091)

19 Lot 2728, Miri Concession Land District Leasehold 60 yearsLopeng, Miri, Sarawak (expiring in 2027)

20 H.S.(D) 54842, P.T. No. 152, Mukim of Damansara, FreeholdDistrict of Petaling Jaya, Selangor

21 No. 24, Jalan KIP 7, Taman Perindustrian KIP, Freehold52200 Kuala Lumpur

Notes: The Group does not adapt a revaluation policy on landed properties.N/A denotes “Not Applicable”


Description/ Date of AREA Age Of Building Net Book ValueExisting Use Acquisition (Years) As At 31.12.2003

RM’000

Land with a building / 29.12.1997 22,529 sq ft 6 810 Telecommunications Centre

Apartment/ 26.01.1995 802 sq ft 8 112 Housing base transceiver equipment

Apartment/ 04.02.1995 2,429 sq ft 10 595Housing base transceiver equipment

Apartment/ 25.01.1995 1,249 sq ft 9 223 Housing base transceiver equipment



Land with a building/ 12.05.1995 1.58 acres 9 1,300 Telecommunications Centre

Land with a building / 23.03.1995 1 acre 29 2,123 Telecommunications Centre

Land with a building/ 12.06.1995 0.938 acre 23 2,353 Telecommunications Centre

Land with a building / 15.08.1995 4,124 sq ft 8 1,993 Telecommunications Centre

Land with a building / 07.07.1995 4 acres 21 2,296 Telecommunications Centre



Land with a building / 07.08.1996 7.5 acres 9 6,218 Earth Station Complex

Land with Fixed Line 14.11.1997 25,521 sq ft 6 406 switch and base transceiver station

Land with trunk station 17.08.1999 40,000 sq ft 4 118

Land with a building / 15.07.1999 5,942 sq ft 4 218 Telecommunications Centre


Land with a building / 29.09.2000 4,937 sq ft N/A 1,138 Telecommunications Centre

Land 19.07.2001 284,485 sq ft N/A 14,244



Statistics on Shareholdings as at 2 March 2004

Analysis of shareholdings

Size of shareholdings No. of shareholders % No. of shares %

less than 100 181 4.88 2,567 0.00100 - 1,000 1,594 42.96 1,420,497 0.191,001 - 10,000 1,571 42.35 5,455,131 0.7310,001 - 100,000 243 6.55 7,992,996 1.06100,001 - 37,499,999 118 3.18 277,629,179 37.0237,500,000 * and above 3 0.08 457,499,630 61.00

Total 3,710 100.00 750,000,000 100.00

notes: 1. There is only one class of shares in the paid-up capital of the Company. Each share entitles the holder to one vote.

2. * Denotes 5% of the issued and paid-up capital of the Company.

Statement of Directors’ Shareholdings as at 2 March 2004


No. of Ordinary Shares of RM1.00 each The Company Direct Interest % Deemed Interest %

Tan Sri Dato’ Seri Vincent Tan Chee Yioun 53,804,237 7.17 82,582,587 11.01

Ultimate Holding Company No. of Ordinary Shares of NOK6 each TELENOR ASA Direct Interest % Deemed Interest %

Arve Johansen 24,791 0.0014 - -Ole Bjorn Sjulstad 1,001 0.0000 - -Per Olav Fosse 3,771 0.0002 - -Gunnar Johan Bertelsen 170 0.0000 - -Thor Absjorn Halvorsen 1,886 0.0001 - -

No. of Options over Ordinary Shares of NOK6 each Direct Interest % Deemed Interest %

Arve Johansen 200,000 0.0110 - -Ole Bjorn Sjulstad 10,000 0.0005 - -Per Olav Fosse 10,000 0.0005 - -Thor Absjorn Halvorsen 85,000 0.0047 - -

By virtue of his interests in the shares of the Company shown above, Tan Sri Dato’ Seri Vincent TanChee Yioun is deemed to be interested in the shares of the subsidiaries (as set out in Note 5 to thefinancial statements) to the extent the Company has an interest.

Save as disclosed, none of the other Directors in office have any interest in the shares of theCompany and its related corporations as at 2 March 2004.

List of Thirty (30) Largest Shareholders as at 2 March 2004

Name of shareholders No. of shares %

1 Citicorp Nominees (Asing) Sdn Bhd 247,000,000 32.93Telenor Asia Pte Lte

2 Citicorp Nominees (Asing) Sdn Bhd 105,499,630 14.07Telenor Asia Pte Lte (Digi)

3 Citicorp Nominees (Asing) Sdn Bhd 105,000,000 14.00Telenor Asia Pte Lte (Digi / Moratorium)

4 Employees Provident Fund Board 36,521,720 4.87

5 AMMB Nominees (Tempatan) Sdn Bhd 24,609,274 3.28Pledged Securities Account For Berjaya VTCY Sdn Bhd (Bk 6/166-0)

6 CIMB Nominees (Tempatan) Sdn Bhd 21,046,570 2.81Pledged Securities Account For Berjaya VTCY Sdn Bhd

7 Cimsec Nominees (Tempatan) Sdn Bhd 20,411,014 2.72Danaharta Urus Sdn Bhd For Tan Sri Dato’ Seri Vincent Tan Chee Yioun

8 Amsec Nominees (Tempatan) Sdn Bhd 19,811,043 2.64Amfinance Berhad For Tan Seri Dato’ Seri Vincent Tan Chee Yioun

9 Inter-Pacific Equity Nominees (Tempatan) Sdn Bhd 14,551,523 1.94Prime Credit Leasing Sdn Bhd For Alam Nusantara Sdn Bhd

10 Cimsec Nominees (Tempatan) Sdn Bhd 11,288,811 1.51Danaharta Urus Sdn Bhd For Berjaya VTCY Sdn Bhd (Vtcy)

11 Scotia Nominees (Tempatan) Sdn Bhd 10,079,966 1.34Pledged Securities Account For Tan Sri Dato’ Seri Vincent Tan Chee Yioun

12 Scotia Nominees (Tempatan) Sdn Bhd 7,132,271 0.95Pledged Securities Account For Berjaya VTCY Sdn Bhd

13 AM Nominees (Tempatan) Sdn Bhd 6,866,200 0.92Employees Provident Fund Board (A/C 1)

14 Dato Ahmad Sebi Bin Bakar 6,580,196 0.88

15 Malaysia Nominees (Tempatan) Sendirian Berhad 5,900,594 0.79Great Eastern Life Assurance (Malaysia) Berhad (Par 1)

16 Bumiputra-Commerce Nominees (Tempatan) Sdn Bhd 5,380,481 0.72Pledged Securities Account For Malpac Securities Sdn Bhd (3349 Sban)

17 Southern Finance Berhad 4,591,889 0.61Pledged Securities Account For Tan Sri Dato’ Seri Vincent Tan Chee Yioun

18 Amsec Nominees (Tempatan) Sdn Bhd 3,569,820 0.48Pledged Securities Account For Berjaya VTCY Sdn Bhd

19 PM Nominees (Tempatan) Sdn Bhd 3,091,371 0.41Malpac Management Sdn Bhd For Ahmad Sebi Bin Bakar


Substantial shareholders as at 17 March 2004

No. Of Shares Direct Interest % Deemed Interest %

1. Berjaya VTCY Sdn Bhd 71,827,825 9.58 - -2. Tan Sri Dato’ Seri Vincent Tan Chee Yioun 53,804,237 7.17 82,582,587 (a) 11.013. Telenor Asia Pte Ltd 457,499,630 61.00 - -4. Telenor Mobile Communications AS - - 457,499,630 (b) 61.005. Telenor Mobile Holding AS - - 457,499,630 (c) 61.006. Telenor ASA - - 457,499,630 (d) 61.007. Employees Provident Fund Board 45,336,009 6.04 - -

Notes: (a) Deemed interested by virtue of his interest in Berjaya VTCY Sdn Bhd and deemed interest in Inter-Pacific Securities SdnBhd, Eng Securities Sdn Bhd, Inter-Pacific Capital Sdn Bhd, Berjaya General Insurance Berhad, Prime Credit Leasing SdnBhd, Indah Corporation Berhad and Immediate Capital Sdn Bhd.

(b) Deemed interested by virtue of its 100% interest in Telenor Asia Pte Ltd.(c) Deemed interested by virtue of its 100% interest in Telenor Mobile Communications AS.(d) Deemed interested by virtue of its 100% interest in Telenor Mobile Holding AS.

Name of shareholders No. of shares %

20 AM Nominees (Tempatan) Sdn Bhd 2,911,900 0.39Pertubuhan Keselamatan Sosial

21 Tan Sri Dato’ Tan Chee Sing 2,705,000 0.36

22 Berjaya General Insurance Berhad 2,398,522 0.32

23 Tengku Adnan Bin Tengku Mansor 2,257,763 0.30

24 Eng Securities Sdn Bhd 2,108,423 0.28Ivt A01

25 Universal Trustee (Malaysia) Berhad 2,071,000 0.28SBB Premium Capital Fund

26 Kamarudin Bin Jaffar 2,000,000 0.27

27 Bumiputra-Commerce Trustee Berhad 1,970,000 0.26RHB Mudharabah Fund

28 HDM Nominees (Asing) Sdn Bhd 1,941,800 0.26DBS Vickers Securities (Singapore) Pte Ltd For Capital Intelligence Limited

29 Inter-Pacific Equity Nominees (Tempatan) Sdn Bhd 1,924,229 0.25Prime Credit Leasing Sdn Bhd For Ahmad Fizal Bin Othman

30 HSBC Nominees (Asing) Sdn Bhd 1,922,000 0.25HPBS SG For Kingswood Overseas Investments Limited

683,143,010 91.09

List of Thirty (30) Largest Shareholders as at 2 March 2004

(continued)


NOTICE IS HEREBY GIVEN THAT the Seventh Annual General Meeting of DiGi.Com Berhadwill be held at Bronx V West Tower, Level 13A Berjaya Times Square Hotel & ConventionCenter, 1 Jalan Imbi, 55100 Kuala Lumpur on Wednesday, 28 April 2004 at 9.30 a.m. for thefollowing purposes:-

Agenda

1. To receive and adopt the audited financial statements of the Company for the year ended 31 December 2003 and the Directors’ and Auditors’ Reports thereon. Resolution 1

2. To re-elect the following Directors retiring pursuant to the Company’s Articles of Association:

a) Ole Bjorn Sjulstad Resolution 2

b) Dato’ Ab. Halim Bin Mohyiddin Resolution 3

c) Gunnar Johan Bertelsen Resolution 4

3. To re-appoint Tun Dato’ Seri Dr Lim Chong Eu as a Director of the Company and to hold office until the conclusion of the next Annual General Meeting of the Company pursuant to Section 129(6) of the Companies Act, 1965. Resolution 5

4. To re-appoint Messrs KPMG as Auditors and to authorise the Directors to fix their remuneration. Resolution 6

5. As special business:-

(a) To consider and, if thought fit, pass the following ordinary resolutions:-

i) Authority to Allot and Issue Shares Pursuant to Section 132D of the Companies Act, 1965

“That, subject always to the Companies Act, 1965, the Articles of Association of the Company and the approvals of the relevant governmental/regulatory authorities, the Directors be and are hereby empowered, pursuant to Section 132D of the Companies Act, 1965, to issue shares in the Company from time to time and upon such terms and conditions and for such purposes as the Directors may deem fit provided that the aggregate number of shares issued pursuant to this resolution does not exceed 10% of the issued share capital of the Company for the time being and that such authority shall continue in force until the conclusion of the next Annual General Meeting of the Company.” Resolution 7

Notice of Annual General MeetingDiGi.Com Berhad (425190-X) 151

ii) Proposed Shareholders’ Mandate For Recurrent Related Party Transactions of a Revenue or Trading Nature

“That, subject to the provisions of the Listing Requirements of Malaysia Securities Exchange Berhad, approval be and is hereby given for the Company and its subsidiaries, to enter into recurrent related party transactions of a revenue or trading nature with the related parties as specified in Section 2.3 of the Circular to Shareholders dated 6 April 2004 which are necessary for the day to day operations and/or in the ordinary course of business of the Company and its subsidiaries on terms not more favourable to the related parties than those generally available to the public and are not detrimental to the minority shareholders of the Company and that such approval shall continue to be in force until:-

(a) the conclusion of the next annual general meeting of the Company following the general meeting at which this Ordinary Resolution shall be passed, at which time it will lapse, unless by a resolution passed at a general meeting, the authority conferred by this resolution is renewed;

(b) the expiration of the period within which the next annual general meeting after the date it is required to be held pursuant to Section 143(1) of the Companies Act, 1965 (but shall not extend to such extension as may be allowed pursuant to Section 143(2) of the Companies Act, 1965); or

(c) revoked or varied by resolution passed by the shareholders at a general meeting;

whichever is earlier;

and that in making the disclosure of the aggregate value of the recurrent related party transactions conducted pursuant to the proposed shareholders’ approval in the Company’s annual reports, the Company shall provide a breakdown of the aggregate value of recurrent related party transactions made during the financial year, amongst others, based on:

i) the type of the recurrent related party transactions made; and

ii) the name of the related parties involved in each type of the recurrent related party transactions made and their relationship with the Company

and further that authority be and is hereby given to the Directors of the Company and its subsidiaries to complete and do all such acts and things (including executing such documents as may be required) to give effect to the transactions as authorised by this Ordinary Resolution.” Resolution 8


(b) To consider and, if thought fit, pass the following special resolution:-

Proposed Amendment to the Company’s Articles of Association

“That Article 89 of the Company’s Articles of Association be amended by deleting in its entirety and substituting with the following new Article 89:

89 (A) The Directors may meet together for the despatch of business, adjourn and otherwise regulate their meetings as they think fit, and determine the quorum necessary for the transaction of the business. Unless otherwise determined, two shall be a quorum. Questions arising at any meeting shall be decided by a majority of votes. In case of an equality of votes the Chairman, Deputy Chairman or any other director so appointed pursuant to Article 91 shall not have a second or casting vote.

(B) The conduct of a meeting of Directors or a committeeof the Directors may include a participation thereat by any Director via telephone conferencing and/or video conferencing or any other interactive means of audio or audio-visual communications whereby all participating persons are able to hear each other or be heard during the meeting. A Director’s participation in the manner as aforesaid shall be deemed to be present at the meeting and be counted for the purpose of a quorum. He shall also be entitled to vote thereat. Any meeting held in such manner shall be deemed to be or have been held at such time and place as set out in the notice of meeting.” Resolution 9

By Order of the BoardSU SWEE HONG Kuala LumpurSecretary 6 April 2004

NOTES:-

(A) APPOINTMENT OF PROXY

i) A member entitled to attend and vote at a meeting of the Company is entitled toappoint one (1) proxy only to attend and vote in his stead. A proxy may but need not bea member of the Company.

ii)A member of the Company who is an authorised nominee as defined under theSecurities Industry (Central Depositories) Act 1991 may appoint one (1) proxy in respectof each securities account.



iii) The instrument appointing a proxy, shall be in writing under the hand of the appointeror his attorney duly authorised in writing, and in the case of a corporation, either underseal or under hand of an officer or attorney duly authorised.

iv) The instrument appointing a proxy must be deposited at the Company’s RegisteredOffice, 11th Floor Menara Berjaya, KL Plaza, 179 Jalan Bukit Bintang, 55100 KualaLumpur not less than 48 hours before the time appointed for holding the meeting orany adjournment thereof.

(B) RESOLUTIONS 2, 3, 4 AND 5:-

The particulars of Directors who stand for re-election/re-appointment are set out in therelevant pages of the Annual Report as follows:-

Name of Director Directors’ Profile Directors’ Shareholdings

1 Ole Bjorn Sjulstad Page 12 Page 148

2 Dato’ Ab. Halim Bin Mohyiddin Page 14 Page 148

3 Gunnar Johan Bertelsen Page 13 Page 148

4 Tun Dato’ Seri Dr Lim Chong Eu Page 12 Page 148

The details of Directors’ attendance at Board Meetings are set out on Page 18 of the AnnualReport.

(C) SPECIAL BUSINESS

1.Resolution 7 is proposed pursuant to Section 132D of the Companies Act, 1965 and ifpassed, will give the Directors of the Company, from the date of the above annualgeneral meeting, authority to issue and allot shares from the unissued share capital ofthe Company for such purposes as the Directors may deem fit and in the interest of theCompany. This authority, unless revoked or varied by the Company in general meeting,will expire at the conclusion of the next Annual General Meeting of the Company.

2.Resolution 8 if passed will approve the Shareholders’ Mandates on Recurrent RelatedParty Transactions and to allow the Company and its subsidiaries to enter into RecurrentRelated Party Transactions in accordance with paragraph 10.09 of the Listing Requirementsof the Malaysia Securities Exchange Berhad. The explanatory notes on Resolution 8 isset out in the Circular to Shareholders dated 6 April 2004 attached to the Annual Report.

3.Resolution 9 for the proposed amendment of the Articles of Association of the Companywill be passed as a Special Resolution and if approved, will allow not only the Board ofDirectors but also the various committees of the Board, if any, to conduct their respectivemeetings via telephone conferencing and/or video conferencing or any other interactivemeans of audio or audio-visual communications.

DiGi.COM BERHAD(Company No: 425190-X)(Incorporated in Malaysia)

I/We(Name in full)

I.C. or Company No. CDS Account No.

of (Address)

being a member of DiGi.COM BERHAD hereby appoint:

I.C. No. (Name in full) (New and Old I.C. Nos.)

of

or failing him/her, the Chairman of the meeting as my/our proxy to vote for me/us on my/ourbehalf, at the Seventh Annual General Meeting of the Company to be held at Bronx V WestTower, Level 13A Berjaya Times Square Hotel & Convention Center, 1 Jalan Imbi, 55100 KualaLumpur on Wednesday, 28 April 2004 at 9.30 a.m. or any adjournment thereof.

This proxy is to vote on the resolutions set out in the Notice of the Meeting as indicated with an“X” in the appropriate spaces. If no specific direction as to voting is given, the proxy will voteor abstain from voting at his/her discretion.

FOR AGAINST

RESOLUTION 1 - To receive and adopt the Audited Financial Statements

RESOLUTION 2 - To re-elect Ole Bjorn Sjulstad as Director

RESOLUTION 3 - To re-elect Dato’ Ab. Halim Bin Mohyiddin as Director

RESOLUTION 4 - To re-elect Gunnar Johan Bertelsen as Director

RESOLUTION 5 - To re-appoint Tun Dato’ Seri Dr Lim Chong Eu as Director

RESOLUTION 6 - To re-appoint Auditors

RESOLUTION 7 - To approve authority to allot and issue shares

RESOLUTION 8 - To approve Shareholders’ Mandate for Recurrent Related Party Transactions

RESOLUTION 9 - To amend the Company’s Articles of Association

No. of Shares

Signature of Shareholder(s)

Signed this day of , 2004.

NOTES: 1. A member entitled to attend and vote at a meeting of the Company is entitled to appoint one (1) proxy only to attend and vote

in his stead. A proxy may but need not be a member of the Company.2. A member of the Company who is an authorised nominee as defined under the Securities Industry (Central Depositories) Act

1991 may appoint one (1) proxy in respect of each securities account.3. The instrument appointing a proxy, shall be in writing under the hand of the appointer or his attorney duly authorised in

writing, and in the case of a corporation, either under seal or under hand of an officer or attorney duly authorised.4. The instrument appointing a proxy must be deposited at the Company’s Registered Office, 11th Floor Menara Berjaya, KL Plaza,

179 Jalan Bukit Bintang, 55100 Kuala Lumpur not less than 48 hours before the time appointed for holding the meeting or anyadjournment thereof.

Form of ProxyDiGi.Com Berhad (425190-X) 155

Aff ix stamp

The Secretary

DiGi.Com Berhad11th Floor, Menara Berjaya KL Plaza179, Jalan Bukit Bintang55100 Kuala Lumpur

2nd fold here

Fold this flap for sealing

1st fold here

Perak

Ipoh40, Medan IstanaBandar Ipoh Raya30000 Ipoh, Perak

Negeri Sembilan

Seremban301, Taman AST70200 SerembanNegeri Sembilan

Sabah

Kota KinabaluLot 5/G3, Ground & 1st FloorsApi-Api Centre88000 Kota Kinabalu, Sabah

Sarawak

KuchingLot 2087, Block 10Bangunan Kueh Boon TeckJalan Tun Ahmad Zaidi Adruce93150 Kuching, Sarawak

MiriLot 938, Ground & 1st FloorsJalan Asmara, 98000 MiriSarawak

Sibu13, Ground & 1st FloorsLorong Kampung Datu 396000 Sibu, Sarawak

24-hour DiGi customer service line: 016-221 1800

DiGi.Com Berhad (425190-X)Lot 30, Jalan Delima 1/3Subang Hi-Tech Industrial Park40000 Shah Alam, Selangor

Mailing Address:P. O. Box 755140718 Shah Alam, SelangorTel: 03-5721 1800Fax: 03-5721 1857www.digi.com.my

Penang

Pulau Tikus368-1-02, Jalan Burmah10350 Pulau TikusPulau Pinang

Seberang Jaya8, Ground FloorJalan Todak DuaPusat BandarBandar Seberang Jaya13700 Prai, Pulau Pinang

Bukit Jambul6B-C-D, Jalan Tun Dr.AwangBukit Jambul Shop House11900 Pulau Pinang

Melaka

Melaka523, Taman Melaka Raya75000 Melaka

Johor

Johor Bahru8, Jalan Molek 1/12Taman Molek81100 Johor Bahru, Johor

Jalan Tun Abdul Razak64, Ground FloorJalan Tun Abdul Razak Susur 180000 Johor Bahru, Johor

Batu Pahat18, Jalan KundangTaman Bukit Pasir83100 Batu Pahat, Johor

Corporate Directory

List of Operating Offices

Principal Place ofBusiness/Head Office


Central OperatingOffices

Lot 5, Jalan U1/15Hicom Glenmarie Industrial Park40150 Shah Alam, SelangorTel: 03-5721 1800Fax: 03-5721 1857

Lots 7 & 8, Jalan Delima 1/1Subang Hi-Tech Industrial Park40000 Shah Alam, SelangorTel: 03-5721 1800Fax: 03-5721 1857


Regional OperatingOffices

Northern Region

62, 1st Floor, Jalan MayangPasir 1Off Jalan Mahsuri11950 Bayan Baru Pulau PinangTel: 04-641 2800Fax: 04-641 3800

Southern Region

8, Jalan Molek 1/12Taman Molek81100 Johor Bahru, JohorTel: 07-351 1800Fax: 07-352 8016

Eastern Region

3, Jalan Tun Ismail25000 Kuantan, PahangTel: 09-508 0071Fax: 09-508 0070

Sabah Region

Lot 36, SEDCO Light Industrial EstateJalan Kolombong88450 InanamKota Kinabalu, SabahTel: 088-431 800Fax: 088-430 016

Sarawak Region

Lot 2087, Block 10, Bangunan Kueh Boon TeckJalan Tun Ahmad Zaidi Adruce93150 Kuching, SarawakTel: 082-421 800Fax: 082-427 597

DiGi Centres

Selangor

USJSubang Taipan, 19 & 21Jalan USJ 10/1A, Subang Jaya47610 Petaling Jaya, Selangor

SS224, Jalan SS2/6647300 Petaling Jaya, Selangor

Selayang Baru57, Jalan 2/3A, Pasar Borong SelayangOff Jalan Ipoh68100 Batu Caves, Selangor

Klang90, Batu 1-1/2, Jalan Meru41050 Klang, Selangor

Kuala Lumpur

Pandan IndahM5A/13, Jalan Pandan Indah 4/1Taman Pandan Indah55100 Kuala Lumpur

KL PlazaLot G33-8, Ground Floor,179, KL PlazaJalan Bukit Bintang55100 Kuala Lumpur

Berjaya Times Square01-36, Berjaya Times Square, 1, Jalan Imbi ,55100 Kuala Lumpur

Pahang

Kuantan3, Jalan Tun Ismail25000 Kuantan, Pahang

DiGi Telecommunications Sdn Bhd 201283-M T (603) 5721 1800Lot 30 Jalan Delima 1/3 F (603) 5721 1857Subang Hi-Tech Industrial Park E [email protected] Shah AlamSelangor Darul Ehsan, Malaysia

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ANNUAL REPORT 2003 LAPORAN TAHUNAN

Documents

DiGi.Com Berhad