FGV Annual Report 2017

FELDA GLOBAL VENTURES HOLDINGS BERHAD UNDERSTANDING OUR BUSINESS CONTEXT 54 OUR PERFORMANCE BY SECTOR: LOGISTICS AND SUPPORT BUSINESSES Management Discussion & Analysis ABOUT THE SECTOR Who We Are and What We Do The Group’s Logistics & Support Businesses (LSB) Sector supports our core business by connecting and controlling the flow of assets to drive group-wide efficiencies via three main arms: International Business, Logistics and Support Businesses (Information & Communications Technology (ICT), engineering and hospitality services). Our Logistics arm possesses one of the world’s largest bulking and storage facilities for edible oil with a capacity of 954,900 MT. It also manages approximately 30% of Malaysia’s total palm oil exports. The business is instrumental to the Group’s aim to be a total logistics solutions provider in Malaysia through its 433 trucks carrying liquid and cargo products, whilst building its resources in total supply chain management covering warehouses and distribution. LSB will help to enhance FGV’s performance and drive improvements in our business activities, in line with our strategic goal to grow our business in adjacent fields. This Sector was known as Logistics and Others (LO) Sector in 2017, thus the information presented in the following sections is based on this classification before we switch to reporting on LSB in next year’s iteration of our AIR. Market Destinations Malaysia, Indonesia and Pakistan The Sector’s revenue rose to RM1,399.45 million from RM1,134.76 million due to improved Group’s logistics operations in tandem with the increase in Crude Palm Oil (CPO) production volumes and a higher average selling price for rubber segment. The Sector’s Profit Before Zakat and Tax (PBZT) rose to RM45.18 million from RM7.96 million in 2016 due to higher throughput handled of 7.56 million MT (2016: 6.53 million MT) and tonnage carried of 5.09 million MT (2016: 4.39 million MT) in 2017. KEY FINANCIAL REVIEW FOR 2017 Revenue PBZT RM1,399.45 million RM45.18 million AWARDS AND RECOGNITION IN 2017 • ISO 9001:2015 certification for Felda Johore Bulkers, Felda Transport Services and Felda Prodata Systems • ISO 22301:2012 certification on Business Continuity Management System (BCMS) • SAP Partners Management Cloud (PMC) Recognition as the First Company in Malaysia (Public Sector) implementing SAP S/4HANA - Hewlett Packard Enterprise