44 LAND LEASE AGREEMENT (“LLA”) LIABILITY (CONTINUED) Movement in LLA liability is as follows: Group 2024 2023 RM’000 RM’000 At 1 January 3,513,813 3,680,354 Fair value changes charged to profit or loss (Note 10) 423,935 133,706 Repayment during the financial year (274,261) (300,247) At 31 December 3,663,487 3,513,813 The fair value of the LLA liability is measured using a discounted cash flow calculation using cash flow projections covering a 86 year period (2023: 87 year period). The cash flow projection is approved by the LLA Steering Committee based on the 2025 approved financial budgets by the Directors plus the projection for the remaining period reflective of the forecasted operational results. The key assumptions used to compute the fair value of the LLA liability are as follows: 2024 2023 Key assumptions Short Term Mid Term Long Term Short Term Mid Term Long Term CPO Price (per MT) 4,000 3,800 3,345 3,600 3,000 – 3,340 2,900 PK Price (per MT) 2,200 2,090 1,970 1,800 1,500 – 1,670 1,800 Average FFB yield (MT/ha) 17.1 18.2 18.4 – 21.0 15.9 16.8 – 17.7 18.1 – 21.1 Mature estate cost (per hectare) 7,612 7,758 7,869 – 14,878 6,906 6,742 – 6,807 6,428 Immature estate cost (per hectare) 7,411 7,735 6,890 – 14,830 5,985 5,817 – 5,951 5,469 Discount rate 9.5% 9.5% Projection period 86 years 87 years Notes to the Financial Statements For the financial year ended 31 December 2024 163
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