FGV Annual Report 2014

The Investor Relations function is central in providing an effective two- way communication between FGV and the finance and investment community Since its listing in 2012, the Group has strived hard to realise the aspirations of becoming a truly global agriculture powerhouse by the year 2020. In 2014, the commodities market witnessed a downturn on a global scale. The high exposure faced by the Group’s share price to commodity price movements generated a lot of interest among analysts and investors alike. Despite the odds, the Investor Relations team worked hard to expand the current shareholder base, maintaining their confidence and coping with swift market development. Moving forward, the Investor Relations team aims to be more proactive in managing the Group’s value among the finance and investment community. The Year Under Review During the year under review, the Group underwent a major restructuring exercise to streamline the business further. This was made possible with the 100 percent ownership of Felda Holdings Bhd, which was our associate company before the acquisition of 51 percent equity from Koperasi Permodalan Felda in December 2013. A new business model focussing on cost excellence, asset- backed trading and improved capital efficiency was also put in place as part of this initiative. Apart from that, we pursued an aggressive replanting exercise to achieve an optimal palm trees age profile by the year 2020. This is on top of other initiatives taken to improve yield and reduce CPO production costs. As a result, we achieved the targets set out in 2014 and we are now on track to meet 2020 targets. Building on this, we also actively pursued mergers and acquisitions as well as other major investment activities to accelerate growth and improve our corporate portfolio. Among some of the major investments executed include the acquisitions of M2 Biodiesel plant in Kuantan; FGV Cambridge Nanosystems Ltd in Cambridge, United Kingdom; and Asian Plantations Ltd, which owns 24,622 hectares of oil palm plantations in Sarawak. However, the second half of 2014 proved to be more challenging with some factors beyond our control. The downward trend experienced by our share price was attributed to bad weather conditions and the unfavourable global commodities market performance. The bad weather conditions resulted in floods that covered about 6.34 percent of FGV’s total planted areas, thus affecting our performance in the second half of the year. In terms of the global commodities market, CPO prices dropped from RM2,649 in January 2014 to RM2,226 in December 2014. Faced with this challenging yet interesting market development, the Investor Relations team actively engaged with the investment community, both local and foreign, to provide clarity and consistently update them on FGV’s performance. Institutional investors and analysts were presented with various platforms to continuously interface with senior management. These events were led by the Group President/Chief Executive Officer and Chief Financial Officer, supported by the Investor Relations team and selected members of the Palm and Sugar Upstream and Downstream, Rubber, Research and Development as well as the Transport, Logistics, Marketing and Others (TLMO) Clusters. Summary of Investor Relations Activities Year 2013 2014 Number of briefings to analysts and fund managers 6 4 Site visits to Group's facilities 5 5 Number of conferences organised by financial institutions 9 5 Number of meetings (1-to-1 meetings at conference and in-house meetings) 83 133 Number of analysts/fund managers met during in-house meeting and conferences 334 340 Felda Global Ventures Holdings Berhad pg 62 INVESTOR RELATIONS