FGV Annual Report 2014

and zakat of RM538.65 million was also encouraging. This was contributed at least in part by a higher Group CPO price of RM2,410 per tonne compared to RM2,333 per tonne from the previous year and a higher oil extraction rate (OER) of 21.01 percent compared to 20.44 percent from the previous year. Our financial results are a direct consequence of a transformation journey that we embarked on in 2012, guided by our Global Strategic Blueprint (GSB). This journey, which envisages FGV becoming a top 10 agri-business powerhouse by 2020, seeks to address our competitiveness at different levels. At the corporate level, we are streamlining our more than 100 subsidiaries operating in over 10 countries. During the year under review, we divested non-core and non-profitable assets and businesses such as Malaysia Cocoa Manufacturing. We are creating a more balanced portfolio of Clusters by growing our rubber and sugar businesses to decrease an over-dependence on palm. At the same time, we seek to grow a stronger presence along the entire value chain of all three of palm, rubber and sugar – from the upstream through the midstream and into the downstream. Applying the Blue Ocean strategy, our overall objective is to explore and create new, untapped market space through high quality products and service offerings, driven by innovation and best practices. The year 2014 has seen us continue with our series of mergers and acquisitions. In the upstream, we acquired Asian Plantations Ltd (APL), an oil palm plantation group. APL presents an attractive proposition as it owns 24,622 ha of relatively young oil palm plantations through five wholly-owned estates in Miri and Bintulu in Sarawak, which are serviced by a 60 tonne per hour palm oil mill. Strengthening our Rubber Cluster, we entered into two joint ventures: • We formed FGV Pho La Min Company Ltd in Myanmar together with Pho La Min Trading Company Ltd to apply for Myanmar’s foreign investment license in order to invest in rubber related business activities in the country. • We also set up FGV-CVC Cambodia Ltd together with Co-Op Village Co Ltd, which exports Cambodian Standard Rubber (CSR) grade processed rubber. At the same time, we are in talks with a few potential parties to expand both upstream and midstream rubber related business activities in Cambodia. In the Downstream Cluster, our aim is to enhance our current businesses and further diversify our portfolio of quality food and innovative non-food products supported by our own R&D facility as well as strategic joint ventures. Two successes in the year were: • Entering into a joint venture with M2 Capital Sdn Bhd and Benefuel International Holdings S.A.R.L. to acquire a biodiesel plant in Kuantan Port. Through the joint venture, our biodiesel production capacity has increased more than threefold, making FGV one of the largest exporters of biodiesel in Southeast Asia; and Our financial results are a direct consequence of a transformation journey that we embarked on in 2012 guided by our Global Strategic Blueprint (GSB). This journey, which envisages FGV becoming a top 10 agri-business powerhouse by 2020, seeks to address our competitiveness at different levels. Felda Global Ventures Holdings Berhad pg 18 CEO’S STATEMENT