FGV Annual Report 2015

171 WHO WE ARE & WHAT WE DO OUR STRATEGIC INTENT & PERFORMANCE HOWWE ARE GOVERNED CREATING SUSTAINABLE VALUE OUR NUMBERS ADDITIONAL INFORMATION DETAILS OF THE ANNUAL GENERAL MEETING ADDRESSING OUR RISKS & OPPORTUNITIES Felda Global Ventures Holdings Berhad Annual Integrated Report 2015 Chief Financial Officer’s Statement Cost Optimisation Turnaround of Palm Downstream Cluster performance from loss of RM14 million to profit of RM9 million YoY. PBT 2014 vs 2015 RM9 mil -RM14 mil +>100% In our efforts for continual rationalisation to improve efficiency and save future associated costs in maintaining entities, the Group has, during the year under review appointed liquidators and placed seven (7) dormant subsidiaries under a Member’s Voluntary Winding-Up petition. CPO PRODUCTION COST (RM/MT CPO) 3% 1,397 1,353 2015 2014 FFB COST (RM/MT FFB) 2% 2015 2014 245 239 MILL PROCESSING COST (RM/MT CPO) 10% 2015 2014 230 207 Optimum age in the next coming 4 years through aggressive replanting. Average Age profile for palm plantation is expected to improve by almost 20% by 2020 as a result of the aggressive replanting programs 18.0 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 Average age profile Year 2015 2016 2017 2018 2019 2020 12.7 13.4 14.0 14.8 15.2 15.8 +19.6% OPTIMISING OUR BUSINESS During the year under review, our cost optimisation initiatives returned positive results with recorded reductions in administrative expenses at Group level, savings achieved through procurement optimisation efforts and revenue enhancements in our Palm Downstream Cluster. Our ambition to aggressively replant on average of 15,000 ha per annum, in view of improving our crop age from its average of 15.8 years to 12.7 years by 2020 further ensure better revenue streams.