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164 TRANS FORMATION
NOTES TO THE FINANCIAL STATEMENTS
For the Financial Year Ended 31 December 2011
43 EVENTS AFTER THE BALANCE SHEET DATE (cont’d)
(c) On 26 March 2012, MSC announced that in line with the prevailing provisions of the State’s Minerals Enactment
(Perak) 2003 {Enakmen Mineral, (Perak) 2003}, (referred to as 2003 Enactment) its wholly-owned subsidiary,
Rahman Hydraulic Tin Sdn. Bhd. (“RHT”) has agreed to pay royalty to the State Government of Perak (“State
Government”) at a higher rate of 5% on sales of tin-in-concentrates from the current rate of 2.5% payable
under the exisiting terms of the current mining leases over Lot No.6173 (ML004), Lot No.7430 (ML005), Lot
No.6175 (ML006), Lot No.6147 (ML007) and Lot No.2206 (ML008) for a total area of approximately 600.996
hectares (collectively referred to as Current Mining Leases) in Wilayah Klian Intan, Mukim Pengkalan Hulu,
Daerah Hulu Perak, State of Perak Darul Ridzuan which were originally issued under the old Enactment which
has subsequently been replaced by the 2003 Enactment. With this agreement to pay a higher royalty effective
from March 2012, the MSC Board is pleased that the State Government of Perak has approved the renewal
of the Current Mining Leases for a longer period up to 28 September 2030 pursuant to the 2003 Enactment.
The extension of the Current Mining Leases to 2030 will enable RHT to undertake the necessary additional
investments to optimise its long term production level. This is expected to result in an increase in future
earnings and thus, the overall valuation of RHT. Apart from contributing an additional revenue to the State
Government from higher royalty, the longer mine life is also expected to benefit the community and all other
stakeholders under the principles and objectives of sustainable development.
44 SEGMENT INFORMATION
For management purposes, the Group is organised into business units based on their products and services, and has
four reportable operating segments as follows:
(a) The Resources’ principal activities are in the smelting of tin concentrates and tin bearing materials, the production
of various grades of refined tin metal under the MSC brand name and the sale and delivery of refined tin metal
and by-products, as well as investments in other metals and mineral resources.
(b) The Hospitality business includes hotel ownership and hotel management under the “Rendezvous” brand,
with strong regional hotel presence in strategic cities. The Group officially launched its hospitality rebranding
in October 2011 with 3 tiers, the Rendezvous Grand Hotels for premier accommodation, Rendezvous Hotels
targeting upper-midscale travelers and Rendezvous Studios for the value-conscious travelers.
(c) The Property segment comprises property investment, sales and leasing, property development as well as
media advertising. The Group will continue to divest non-core property assets.
(d) The segment for Others comprises strategic financial investments and Group-level corporate services and
treasury functions.
Management monitors the operating results of each business unit separately for the purpose of making decisions
about resource allocation and performance assessment. Segment performance is evaluated based on net profit, as
explained in the table below.
Transactions between operating segments are based on terms agreed between the parties.