SUGAR Business Review: Sugar Division KEY FOCUS AREAS Export Optimisation Expanding market share in the Asia-Pacific region through strategic partnerships to drive sales and better pricing. Strategic Capital Management Enhancing cost efficiency, optimising capital expenditure, and strengthening financial planning to support profitability. Sustainable Operations Ensuring stable operations at MSM Prai while improving yield and UF at MSM Johor. Domestic Market Growth Strengthening market outreach to drive revenue and sales by optimising supply chains, forming strategic wholesaler partnerships, and segmenting production based on refinery locations. BUSINESS ENVIRONMENT In 2024, the Sugar Division navigated economic and industry challenges while maintaining profitability through a strategic turnaround. Global inflationary pressures and geopolitical tensions continued to impact the cost of key inputs, including energy and logistics. The global sugar supply faced disruptions due to climate-related production declines in key regions like Thailand and Brazil, along with India’s extended export ban. These factors tightened supply and drove up global raw sugar prices, impacting the Sugar Division’s performance. Currency volatility further influenced procurement costs, requiring strategic hedging measures. The Malaysian government continued its RM1.00 per kilogram (kg) incentive to the local joint sugar industry to stabilise production costs and control retail prices for select packed sugar. However, the incentive was limited to controlled sugar products, requiring manufacturers to absorb higher costs for other segments. Despite these challenges, we reinforced our leadership in the domestic market while expanding into Asia-Pacific region and other emerging markets. Operational stability remained a priority, with both refineries ensuring a steady supply to meet local and export demand. Strategic efficiency improvements and cost optimisation initiatives further enhanced production performance, resulting in better yields. WHO ARE WE AND WHAT WE DO MSM Malaysia Holdings Berhad (MSM), the 51%-owned subsidiary of FGV’s Sugar Division, is Malaysia’s leading refined sugar producer, commanding approximately 60% of the domestic market. With an annual refining capacity of 2.05 million MT across its two refineries, MSM Prai Berhad (MSM Prai) and MSM Sugar Refinery (Johor) Sdn Bhd (MSM Johor), the group ensures a stable and reliable sugar supply for both local international markets. As a key player in the national sugar supply chain, MSM plays a vital role in maintaining a stable and competitive supply while expanding its presence in regional and global markets. Its flagship brand, Gula Prai, remains a household name, recognised for its consistency and excellence. Through operational efficiency, financial resilience, and sustainable growth, MSM continues to adapt to evolving market demands and strengthen its market leadership. MSM, a subsidiary of FGV, is Malaysia’s leading sugar producer, supplying refined sugar to households and industries nationwide. 100 FGV Holdings Berhad | Annual Integrated Report 2024
RkJQdWJsaXNoZXIy NDgzMzc=