• Phase II of GLC Transformation Programme Successfully Completed.
• YAB Prime Minister Reviews Progress of GLC Transformation Programme and Launches Remaining Initiatives

YAB Dato’ Seri Abdullah Haji Ahmad Badawi was today given a progress report on the Government-Linked-Companies (“GLC”) Transformation Programme by the Putrajaya Committee on GLC High Performance (“PCG”) and launched the final initiatives under Phase II of the GLC Transformation Programme.

The event marks the successful completion of Phase II of the GLC Transformation Programme – “Generating Momentum” – which saw all ten Initiatives as promised under this phase being delivered on track and as scheduled.

As an update on the progress of the program, the PCG also published the inaugural Progress Review report which highlighted the progress made under the GLC Transformation program to date. Since the launch of the GLC Transformation Programme in May 2004, the 20 major listed GLCs (G-20) have seen an increase in their market capitalisation by approximately RM59 billion (or equivalent to one third of their value) to RM203 billion. In addition, Total Shareholder Returns (TSR) of the G-20 has been performing in line with the broader market since inception of the programme with a Compounded Annual Growth Rate (CAGR) of 16.9% against the KLCI CAGR of 17% in the same period.

Underscoring the importance of GLCs in the economy, it is estimated that listed GLCs collectively have multiplier effect of 1.4x, i.e. a RM1.00 investment by all listed GLCs would yield RM1.40 of incremental output. Under Phase II of the program significant progress has been made by GLCs which have already resulted in some tangible benefits to key stakeholders of the program, not only through improved financial performance, but also, by design, provided benefits to a range of stakeholders, such as customers, employees, suppliers, the Government and the Bumiputera community, among others.

Reflecting an underlying principle of the GLC Transformation Program on national development, the GLCs have also taken leading roles in promoting and investing in key regional economic developments as announced under the Ninth Malaysia Plan (“9MP”) such as Iskandar Development Region, the Northern Corridor and the Eastern Corridor.

This is in tandem with strong GLC participation in other areas of the 9MP including contributing to key infrastructure projects as well as being good corporate citizens through their focussed Corporate Responsibility programs.

The Progress Review highlighted the achievements of the various GLCs in key areas such as restructuring and turnaround (Malaysia Airline,Tenaga, UEM World); significant increase in profitability or growth (Maybank, POS, Sime Darby); transformational growth/consolidation (BCHB/CIMB, Boustead, BIMB); regionalisation (TM, BCHB/CIMB, MAHB) and expansion through new businesses/9MP activities (Golden Hope, Guthrie, Sime Darby, UEM World, MRCB)

The Progress Review also saw recommendations for Phase III of the program (2007-2010) going forward for key agents of the programme including GLC CEO/Top Management, GLC Boards, GLICs, Government and PCG/TMO where all will have to continue to play a pivotal role to ensure that the Programme shifts focus and delivers results.

In his speech the Prime Minister expressed his pleasure with the progress made by the GLCs in their transformation journey. He highlighted that the GLC Transformation Programme is one of the key policies of his administration and is an integral part of the National Mission outlined in the Ninth Malaysia Plan (RMK9) and reaffirmed the Government’s strong support to this program.