PT Graha Layar Prima Tbk (the “Company”) or also knows as CGV Cinemas was established in year 2004 by a group of local investor which has vast experience in developing property, entertainment and entrepreneur. Year 2006 is a significant milestone for the Company which marked by the opening of the Company’s first cinema located in Paris Van Java Bandung. Then in 2014, the Company became the first and only one listed Company in cinema industry, and also has collaboration with a well-known Global Cinema Operator from South Korea namely CJ CGV.
Through its vision namely Evolving Beyond Movies, No. 1 Cultureplex in Indonesia, CGV Cinemas come with a unique concept namely Cultureplex where customers can enjoy variety of excitement to create a lasting and memorable experience At the First, the Only and the Best Cinema. Our unwavering commitment to deliver the Cultureplex as the new cinema concept has been the driving force behind CGV Cinemas constant evolution. Graha Layar Prima BLTZ
Company core values:
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INTEGRITY
Adherence to rules and standards and intolerance to inefficiency and corruption. By Integrity means:- Intolerance to inefficiency
- Transparent reporting and no concealing
- Acting honesty by: no illegal actions, fraud, embezzlement or corruption
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PASSION
Striving for No. 1 through challenges with tenacity. By Passion means:- Set your aspirations to be No. 1 with absolute determination
- Pursue the highest achievement and perfection by seeing everything through the end
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CREATIVITY
Creative ideas that lead to change and innovation. By Creativity means:- Work with a “Change Everything” attitude
- Reduced 30% of your work and continuously search for new ways of doing things
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RESPECT
Mutual understanding and respect. By Respect means:- Respecting perspectives and opinion arising on the decision making process
- Respecting diversity and considering to prioritize insight of the interlocutors
- Mutual respect and understanding to establish conducive working circumstances Graha Layar Prima BLTZ
Based on the Law of the Republic of Indonesia No. 40 Year 2007 regarding Limited Company (“Law of Limited Company”), the corporate structure consists of the General Meeting of Shareholders (“GMS”), the Board of Commissioners, and Board of Directors.
GMS conducts important decision-making based on the interests of the company, in accordance with the statements in the Articles of Association and prevailing regulations.
Company management is carried out by Board of Directors, whereas the Board of Commissioners conducts adequate control of the performance of company management. However, both have responsibilities to maintain the sustainability of Company business over the long term. Therefore, Board of Commissioners and Board of Directors have a similar perception concerning the Vision, Mission, and Company Values.
In supporting their duties, currently Board of Commissioners is assisted by Audit Committee and for Board of Directors’ duties, effective and efficient organizational structure has been formed.
In accordance with the Regulation of the Financial Services Authority No.35/POJK.04/2014 concerning Corporate Secretary of Issuers or Public Companies and Indonesia Stock Exchange Regulation No. I-A concerning Listing of Shares (Stock) and Equity-Type Securities Other Than Stock Issued by the Listed Company, the Corporate Secretary is appointed by the Company and has role to bridge the communication between the Company and the public as well as maintain the information disclosure.
Corporate Secretary also has vital role in ensuring the implementation of Good Corporate Governance has been complied by Board of Directors and Board of Commissioners or other stakeholders.
The elements of Good Corporate Governance in the Company’s organization structure are:
- General Meeting of Shareholders
- Board of Commissioners
- Board of Directors
- Committees under the Board of Commissioners and Board of Directors
- Corporate Secretary Graha Layar Prima
General Meeting of Shareholders (GMS) is an organ of the company which has authority not given to the Board of Directors or the Board of Commissioners as referred to Company Law No. 40 Year 2007 concerning Limited Liability Companies and/or the Articles of Association of the company.
GMS as an organ of the company is the place for shareholders to make important decisions related to capital invested in the company, in accordance with the provisions in Articles of Association and prevailing regulations. The decisions made by GMS must be based on the interests of long-term Company businesses.
GMS consists of Annual GMS and other GMS(s) or is called Extraordinary GMS as stipulated on Financial Services Authority Regulation (“POJK”) No. 32/POJK.04/2014 concerning Planning and Conducting of General Meeting of Shareholders of Public Companies, as amended by POJK No. 10/POJK.04/2017 concerning Amendment of POJK No. 32/POJK.04/2014 concerning Planning and Conducting of General Meeting of Shareholders of Public Companies.
Authority held by GMS includes appointing and dismissing members of the Board of Commissioners and the Board of Directors, evaluating the performance of the Board of Commissioners and the Board of Directors, approving amendments to the Articles of Association, approving the Annual Report and determining the form and amount of remuneration for members of the Board of Commissioners and the Board of Directors as well as making decisions related to corporate actions or other strategic matters proposed by the Board of Directors. Resolutions made by the GMS are based on the interests of the Company. Without diluting either the power and authority of the GMS, the GMS or shareholders may not intervene against the duties, functions and authority of the Board of Commissioners and the Board of Directors in carrying out obligations and rights in accordance with the Articles of Association and prevailing regulations.
The decision making of GMS is made fairly and transparently. Graha Layar Prima BLTZ
Board of Commissioners (“BOC”) is the organ which has the duty and collective responsibility to supervise and advise the Board of Directors and to ensure that the Company has implemented GCG at all organizational levels or hierarchy.
In carrying out its duties, BOC is responsible to the GMS. BOC accountability to the GMS is a manifestation of supervisory accountability for corporate management in the implementation of the principles of Good Corporate Governance. BOC performance is evaluated based on performance assessments elements, arranged independently by the BOC. Assessment is carried out at each end of the closing. All of BOC report and performance evaluation results should be stipulated in the Company’s Annual Report and are presented in the GMS.
- President Commissioner : Bratanata Perdana
- Independent Commissioner : Gatot Subroto
This composition according to Company’s Articles of Association and Regulation of the Financial Services Authority No. 33/POJK.04/2014 concerning the Board of Directors and BOC of Issuer or Public Company (“POJK No. 33”), which outlines that every public company should have an Independent Commissioner at least 30% of the total number of members of the BOC.
The Responsibilities of Board of Commissioners
- Conducting supervision over the management of the company as executed by the BOD, and providing approval of the annual work plan of the Company for the coming year.
- Ensuring the GCG implementation.
- Supervising the strategic and operational decisions of the BOD as well as the effectiveness of the Company’s management.
- Performing the duties that are specifically given according to the Articles of Association and prevailing laws, regulations, and/or based on the GMS resolutions.
- Performing duties, authorities and responsibilities in accordance with the provisions of the Company’s Articles of Association and GMS resolutions.
- Observing and reviewing the Annual Report prepared by the Board of Directors, as well as signing the report.
- Complying with the Articles of Association and regulations, and implementing the principles of professionalism, efficiency, transparency, independency, accountability, responsibility, and fairness.
Independency of the Board of Commissioners
In performing their duties and responsibilities, the BOC is committed to issue any decision by preserving the independency level. One way to actualize it is by assuring that none of the member of the BOC has family relationship due to marriage or second descendant either vertically or horizontally with any other member of the BOC.
Competency Improvement
In increasing their competencies in order to perform the duties
and responsibilities which entrusted, the BOC has participated in
several programs related to training, benchmarking or even important
seminars, independently. Graha Layar Prima BLTZ
Duties and Responsibilities of the Board of Directors
The BOD is responsible for the overall management of the Company as well as establishing strategy for the Company.
Duties and responsibilities of the BOD in accordance with the Company’s Articles of Association including:
- To manage the Company with responsibilities and authorities as stated in the Articles of Association, prevailing laws and regulons as well as Good Corporate Governance principles in order to increase the welfare of its stakeholders.
- To direct the Company’s operations strategy in conducting the business.
- To determine the Company’s vision, mission, values and strategic plan that is incorporated in the Corporate Plan and Business Plan.
- To establish the organization structure supported by detailed job description for each division.
- To manage human capital of the Company in an effective and efficient manner.
- To develop internal control and risk management systems, to ensure that the Company’s Internal Audit is effectively functioning at every management level and that audit findings are properly followed up based on directions from the Board of Commissioners.
In addition, the BOD also has the right to represent the Company, inside and outside the Court, about everything and in all the events that bind the Company with other parties or vice versa.
Competency Development
Pursuant to increasing and developing their competencies in
order to support the Company’s management tasks, each member of the BOD
has independently participated in several programs that closely related
to workshop, conference, and talk show in accordance with each
respective roles and duties relate to Company business. Graha Layar Prima BLTZ
Audit Committee is a committee who assists the Board of Commissioners in carrying out the oversight responsibilities for the financial reporting process, the implementation of the business and financial risk management, the effectiveness of internal control systems, audit activities, and the implementation of Good Corporate Governance in the management of the Company.
In performing its duties, the Audit Committee is associated with the Board of Commissioners, Board of Directors, Managers, Internal Auditors and External Auditors. Audit Committee carries out its functions in accordance with the regulations of Financial Services Authority known as Otoritas Jasa Keuangan (OJK) and Indonesia Stock Exchange (IDX), and in accordance with instructions received from the Board of Commissioners.
The term of office of member of Audit Committee which not part of the Board of Commissioners is the same with the term of office of the Board of Commissioners as stipulated in the Articles of Association and can be reappointed only for one period of the next term of office.
The composition of Audit Committee consists of an Independent Commissioner who act as a Chairman of the Committee and supported with independent parties, which in accordance with prevailing provisions, have expertise in financial and accounting.
Based on POJK No. 55 concerning Establishment and Working
Guidance of Audit Committee, therefore the Company has established an
Audit Committee in accordance with the applicable rules and regulations
as contained in the Circular Resolution of the Board of Commissioners
dated July 2, 2020. Graha Layar Prima BLTZ
In compliance to Financial Services Authority Regulation No. 56/POJK.04/2015 concerning Establishment and Guidelines for Preparing the Internal Audit Unit Charter and based on the Decree of the President Director of the Company and approval from Board of Commissioners dated October 24, 2019 the Company has appointed Mr. Arindya Pratama Lubis, SH as the Chairman of the Company’s Internal Audit Unit.
The Company has established an Internal Audit Unit Charter by the Board of Directors based on the Circular Resolution of the Company's Board of Directors dated July 26, 2013 and has approved by the Board of Commissioners based on Circular Resolution of the Company’s Board of Commissioners dated July 26, 2013 and amended on September 27, 2019. This charter as for the working guidelines of the Internal Audit Unit.
BLTZ – Internal Audit Unit Charter
- Formulate and implement annual Internal Audit plan;
- Testing and evaluating the implementation of internal control and risk management system in accordance with the Company policy;
- Conduct examination and assessment of the efficiency and effectiveness in the fields of finance, accounting, operational, human resource, marketing, information technology and other activities;
- Providing recommendations and objective information concerning the activities examined at all management levels;
- Create report of audit result and submit the report to President Director and Board of Commissioners;
- Monitor, analyze, and report on the implementation of corrective measures that have been suggested;
- Cooperating with Audit Committee;
- Establish a program to evaluate the quality of Internal Audit activities that have been conducted; and
- Conduct special audit(s) when required. Graha Layar Prima BLTZ
The Corporate Secretary is the liaison who bridges interests between
the Company and external parties, principally in an effort to maintain a
positive public perception of the Company’s image and as the Company’s
fulfillment of its responsibilities. The Corporate Secretary reports to
the Board of Directors.
Functions of the Company's Corporate Secretary include secretarial duties, public relations with investors, legalities and compliance with capital market industry authorities, as well as in accordance with provisions of Good Corporate Governance. Through various activities associated with the public, the Corporate Secretary helps maintain the image of the Company and represents the Board of Directors in any external communications, especially with regulators, investors, the capital market community and other stakeholders.
The functional duties of the Company’s Corporate Secretary include secretarial duties, public and investor relations, legalities and compliance toward industrial authorities and capital markets, as well as provisions of Good Corporate Governance (GCG):
- Acting as a representative of the Company in conjunction with all stakeholders in communicating Company activities, primarily those related to information disclosure.
- Controlling the management of external and internal communications strategy with all stakeholders to openly and accountably deliver news from the Company, while maintaining its positive image.
- Being responsible for fulfilling compliance with existing regulations on the stock exchanges and the capital markets, including the Law on Limited Liability Companies.
- Monitoring developments and regulatory changes occurring in capital markets, as well as providing recommendations and advice to the Board of Directors related to the developmental impact of these changes on the Company and the implementation of these changes within the Company.
- Responsible for fulfilling compliance with the current laws of the stock exchange and the capital markets related to the disclosure of information.
- Responsible for organizing Board of Directors' meetings and Board of Directors' meetings with Commissioners and with the General Meeting of Shareholders.
- Secretarial or administrative control of Board of Directors' correspondence with concerned parties, including Financial Services Authority (“OJK”) and the Indonesian Stock Exchange (“IDX”).
- Handling of Investor Relations in order to maintain and improve communications between the Company and investors, both locally and internationally.
- Correspondence with OJK and IDX as the capital market regulator.
- Providing updates on the investment community to the Board of Directors.
- Conducting meetings, visits, conferences and roadshows in order to maintain good relations with investor and analyst communities.
- Presenting the Company’s development to the public through an open information report by way of press release, websites, and other information channels available to the Company.
- Presenting regular financial reports, along with annual report to OJK and IDX, as well as providing reports on the Company's website and announcements of full year financial statements and half year financial statements in newspapers with national distribution.
- Conducting Annual and Extraordinary General Meeting of Shareholders.
- Holding press conference meetings and dealing with media coverage.
- Conducting Public Expose.
- Participating in capital market activities conducted by the IDX.
Investor Relations
The Corporate Secretary also handles Investor Relations, in order to maintain and improve communication between the Company and investors, both locally and internationally. The Investor Relations function, including provision of the latest information related to the Company's business performance and future outlook, helps investors in making investments in shares of the Company.
Dissemination of information is conducted directly to the investor and to stock market analysts in the form of press releases, presentations and organizing meetings with analysts and investors on a regular basis. Investor Relations periodically met with analysts, investors and fund managers in meetings as well as participation of the Company in Investor Forum.
Information Disclosure
In accordance with the principles of transparency and the fulfillment of the responsibility for compliance with the laws and regulations on the stock exchanges and capital markets related to the disclosure of information, the Company always delivers the latest information related to any developments in the Company submitted to the shareholders and capital market authorities through various communication channels, to ensure effective communication. In addition to reporting directly to capital market and stock exchange authorities, information is submitted to the shareholders in general through IDX announcements and the media.
Access to Information and Company Data
Dissemination of information to all stakeholders is an important part of the increase of transparency of information internally and externally, which is expected to assist, maintain and enhance the knowledge, understanding and positive perception of stakeholders about the Company’s policies and activities. The Company’s information portal is the Company's website: www.cgv.id. in both languages, namely Indonesian and English.
As a form of compliance with disclosure of information, the Company always reports information and material facts through electronic reporting system to OJK and IDX. The Company's disclosure of information conveyed through electronic reporting is available on the IDX website (www.idx.co.id).
Press Release Availability on Website
The Company is actively publicizing every corporate action
through press releases in both the Indonesian and English languages.
Press releases are available on the Company's website. Graha Layar Prima BLTZ
Risk management is part of Company’s management responsibility which
also an integral part in decision making process, in addition, risk
management also part of important pillar in implementing Good Corporate
Governance.
The Company’s and Subsidiary’s activities expose them to a variety of business and financial risks, including the effects of foreign currency exchange rates.
The Company continuously implement the principle of prudence while also maintaining its high awareness level in conducting business activity due to the support from Risk Management Division in minimalizing risk potency that might happened.
With the identification of several key risks, it is expected that the risk balance is achieved along with net income of operating activity for the year, current development plan and future prospects. The risk management system is part of the main responsibilities of BOD with supervision activity performed by BOC and Audit Committee in which the implementation is done through active participation from Internal Audit along with main concern on specific risks issues in other departments.
The Company’s business activities are influenced by various risks.
Risks Related To The Company’s Business Activities Include:
- Risks related to production and the quality of the movie that aired.
Our ability to execute its business activities properly is very dependent on the number of films produced by major studio and independent films producers for showing in the cinemas of the Company, and how attractive these films for audience targeted segmentation, this is the factors that are beyond control of the Company. The financial performance of the Company will vary from time to time based on the number and popularity of the movie that aired. Disruption in the production of the movie, or the decrease in the marketing activities by major and independent movie studios, and insufficient number of movie and poor performance could have a material adverse effect on the Company’s business which led to a decline in income. - Risks related to movie release schedule by distributors.
The Company’s business activities in general is seasonal, where higher income earned on an extended vacation in the middle and end of the school year. Although the movie distributors have started to release major movies more evenly throughout the year, most movies with high demand are usually release during the long school holidays in mid and end of year, and the Company typically earn a higher income in that period than other period throughout the year. Moreover, the movies that have good performance can appear unexpectedly in the period beyond the holiday season and vice versa movies with high production costs could results in unexpectedly poor performance. As a result, movie release schedule can affect the Company’s operating results, which may vary significantly from quarter to quarter and year to year. Pullback the movie release schedule by distributors may impact on the Company’s revenues. - Risks related to the relationship with movie distributors.
The company is highly dependent on good relationships with major and independent movie distributors that provides licenses for the Company to deliver the movies. Worsening relations with the movie distributor could have a bad impact on the availability of the movie that are sold commercially, and thus also have an impact on the Company’s business and operational activities. If the Company does not maintain good relationship with movie distributors which may resulted the Company to not obtain a screening license from the distributors it will impact on the Company’s revenues. - Risks related to the Company’s business development plan cost.
The Company plans to expand its network through the development of new theaters under the brand CGV Cinemas and Blitztheater and also the development of the cinemas/theaters that already exist. The development of new theaters have multiple risks; the cost of building a new movie theater may increase exceeded the initial budget, delays in development or occurrence of unanticipated costs related taxation including inter-regional differences in the cost of cinema locations. The cost of a rental property can continue to increase as it has been for the last few years, the locations of the Company’s plan to build a movie theater may be unavailable or require high costs and decrease the potential target market/audience. The Company realizes that the new cinema market potential cannot be determined precisely and accurately and a new movie theater may face competition from competitors that are not expected. By doing so, the performance of the new cinema cannot meet the initial estimates of the Company. If costs continue to rise then development plan will have an impact on the high cost of capital expenditures that increase the cash outflow for investing activities and depreciation expense. - Risks related to new cinema technology.
If a new cinema technology is rapidly evolving, the Company may not have sufficient resources to finance the transfer of technology to follow the progression. Many advances technology in the film industry is currently in an experimental stage. Many companies are currently competing to be the first company to introduce technology and a 4D cinema also other technologies. Nevertheless, there are some significant obstacles in the application of these technologies, including the quality of the resulting image, audience interest and costs. The new film technologies will require substantial investment costs to complete the facilities at the cinema. If the cost of implementing the new technology significantly increased, the Company may need to raise additional capital to finance it. The additional capital may not be available at a cost that fits the needs of the Company. If the Company faces obstacles in the implementation of new cinema technology will decrease the competitiveness of the Company, which in turn may reduce the Company’s revenues. - Risks related to substitute product.
The Company faces the risk of the shift of audience interest from cinema products to alternative movie products distribution such as DVD movies, pay television and online media through streaming. Rampant piracy activities in the media, which is common in Indonesia, increasing the risk of the shift of audience interest to that media. In addition, technology enhancement which increase significantly such as technology development in home theater with latest screen and technology also enhancement in mobile phone which now offers Virtual Reality technology is also predicted to be the new challenges in the future. If more and more viewers are switching to a substitute product will have an impact on the decline in the Company’s revenues. - Risks related to macroeconomic conditions.
The Company business is highly dependent on the pattern of consumption on entertainment industry. The level visit of audience can be affected by prolonged negative economic trends that affect negatively and significantly to the level of public consumption. The decline in consumer confidence and income to spend (disposable income) in general will affect the level of demand for movie or a negative and significant impact on movie production industry, which in turn will affect the Company’s business activities. Worsening macroeconomic conditions in Indonesia could have an impact on declining interest in watching thus lowering the Company’s revenues. - Risks related Indonesian legislation.
The Company’s business activities are affected by laws and regulations in Indonesia, which regulate the development, renovation/repair and operation of cinemas industry and also salary, work environment, citizenship and health and sanitation provisions and licensing. Although the Company believes that the Company’s theaters have met these provisions, the Company cannot determine the impact of new laws and regulations that may be issued in the future against the Company’s business activities. Changes in laws and regulations will affect the costs of the Company so that it can have an impact on the Company’s revenues. - Risks related to political instability, unrest and other developments related to the Indonesian market.
All the Company’s business activities are located in Indonesia, and the Company believes that the potential for the development of Indonesia in the future will be a significant growth opportunity for the Company. Even so, there is no guarantee of continued subdued economic conditions, political or stable society. Worsening political stability and society in Indonesia, which are beyond the Company’s control, could have a negative and significant impact on our business and financial performance of the Company. These factors can reduce the purchasing power that could ultimately discourage the movies that impact on the Company’s revenues. Graha Layar Prima BLTZ
