2019 UEM Edgenta Annual Report

33 UEM Edgenta Berhad MESSAGE FROM OUR LEADERSHIP STRATEGIC FOCUS OPERATIONAL REVIEW SUSTAINABILITY EFFORTS CORPORATE GOVERNANCE INTRODUCTION FINANCIAL REVIEW ADDITIONAL INFORMATION UEM EDGENTA AT A GLANCE Chairman’s Statement Dear Shareholders, I am pleased to present my first Statement as Chairman since assuming this role on 24 May 2019. During the year in review, UEM Edgenta continued to demonstrate its value as a company with long-term growth prospects as well as a resilient financial position, and businesses that are defensive against short- term volatility. All these have and will continue to enable us to deliver returns to our shareholders, clients and other stakeholders. Tan Sri Dr. Azmil Khalid Independent Non-Executive Chairman RESILIENT AGAINST HEADWINDS Against a challenging operating environment weighed down by uncertainty and a soft economy, we recorded double- digit growth in both revenue and Profit After Tax (“PAT”), which rose 10.5% and 23.4% to RM2.4 billion and RM188.0 million, respectively. Revenue growth was recorded across all our divisions, driven by new contracts and overall stable margins, contributing to the improved profit. For further details on our financial performance, please refer to the CFO’s Review and Operational Review on pages 40 – 41 and 55 - 63 of this Report. The commendable results were achieved amidst volatility in the highway concession sector in Malaysia. Discussions on ownership of the PLUS North-South Expressway, which we maintain and accounts for an important portion of our work-in-hand, caused delays in some planned activities. The Government eventually announced a reduction in toll rates by 18% starting 1 February 2020 and this will remain fixed for the remaining of the concession which has been extended to 2058. In a wider context, we have seen the emergence of industry megatrends in healthcare and infrastructure sectors which will significantly impact the market landscape. Please refer to Our Market Landscape on page 49 of this Report. These developments pose both new challenges and opportunities for our service offerings and delivery. Towards the end of 2019, we also saw the emergence of the novel coronavirus (“COVID-19”) outbreak which has since gripped the world in a global pandemic. This situation remains fluid, but the consensus is that the already fragile global economy will take a turn for the worse. Notwithstanding, given our resilient financial position, we are well-positioned to weather short-term uncertainties and are geared towards our vision of building “Edgenta of the Future”, representing a technology company which focuses on healthcare and infrastructure. REDEFINING OUR FUTURE In establishing our Edgenta of the Future vision, we undertook a strategic review in FY2019, with a view to future-proof our business over the longer-term. This has led to us looking for new areas of growth in a world where traditional or incumbent business models are facing disruption. Given that we have built significant capabilities that have set us apart as an Asset Management and Infrastructure Solutions company, the clear pathway for our next phase of growth was to move beyond technology as an enabler of our own operations, to offering our clients value-added and innovative solutions to complement our existing service offerings to them. We are prepared to rise to the occasion and are geared towards our next phase of growth. Annual Report 2019