BUILDING VALUE AT OUR CORE SEC 5 50 GROUP BUSINESS REVIEW From left • Abu Samah Sulaiman - Head, Renewable Energy Department • Shahril Ibrahim - Group Accountant, Plantation Division • Abdul Malik Sekak - CEO, FGV Palm Industries Sdn Bhd • Rahimi Hissan Wahid - Regional CEO (Peninsular 2) • Borhan Bachi - Group Director, Plantation Division • Hamdan Ismail - CEO, FGV Plantations (Malaysia) Sdn Bhd and Regional CEO (Peninsular 1), and Officer-In-Charge of CEO FGV Fertiliser Sdn Bhd • Zul Hasymi Saadul Kurzi - CEO, FGV Agri Services Sdn Bhd and Officer-In-Charge Regional CEO (Sabah & Sarawak) • Anuar Abdul Talib - CEO, FGV Rubber Industries Sdn Bhd • Romzi Ishak - Head, Research & Development Division • Noor Hisham Hamid - CEO, FGV R&D Sdn Bhd FINANCIAL PERFORMANCE REVENUE RM15,747 million 2022: RM22,573 million PBT RM292 million 2022: RM2,118 million In the Upstream segment, Profit Before Taxation decreased significantly by 88% to RM200 million in 2023 compared to RM1,602 million in 2022. This decline was primarily due to squeezed margins in palm products, driven by a 19% reduction in average CPO price realised, as well as a 34% decrease in average Palm Kernel (PK) price. Moreover, lower CPO production by 10%, in tandem with lower FFB processed and a 29% increase in CPO cost ex-mill due to higher expenses in upkeep and maintenance, manuring, and labour, further impacted profitability. Within the division, the Downstream segment’s profit margins contracted due to lower product margins across all downstream products. This was a result of higher refining and processing costs, coupled with reduced sales volume during the period. Meanwhile, the Research & Development (R&D) segment experienced a lower profit due to higher FFB estate costs and a reduced margin on fertiliser products. REVENUE RM4,350 million 2022: RM6,214 million RM49 million 2022: RM350 million RM568 million 2022: RM1,049 million RM43 million 2022: RM166 million PBT DOWNSTREAM R&D UPSTREAM RM10,829 million 2022: RM15,310 million RM200 million 2022: RM1,602 million
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