MAIN PARAMETERS AFFECTING LLA PROFIT SHARING
(LLA APPLIES TO ESTATES UNDER FGVPM ONLY)

  2012 2013 2014 2015 2016 2017 2018
Profit sharing (RM mil) 140 77 88 30 48 63 55
CPO price (RM/MT) 2,843 2,333 2,410 2,210 2,560 2,792 2,282
FFB Production ('000 MT) 4,911 5,052 4,391 4,070 3,332 3,595 3,569
FFB Yield (MT/Ha) 19.12 19.59 18.79 17.79 14.36 15.12 15.19
Estate cost (RM/MT) 254.97 257.43 260.56 242.40 285.27 275.75 309.24
Average age profile (years) 16.25 15.99 16.31 15.22 15.00 14.79 14.34
Old tree (>21years) 49% 48% 50% 43% 40% 38% 34%

Key Milestones

2012
  • Highest CPO price over a period of 7 years, at RM 2,843 per mt during IPO.
  • Age profile with 54% of old trees, requiring replanting.
    		•
    2013
  • CPO price dropped to RM 2,333 per mt a year.
    		•
    2014
  • Yield levels were impacted by a long period of drought at the beginning of the year.
  • Heavy rainfall caused severe flooding in Johor, Kelantan and Pahang in Q4.
    		•
    2015
  • CPO price hit rock bottom, in 7 years.
  • Manuring activities were delayed to curb escalating estate cost.
  • Severe flooding in the early part of the year.
    		•
    2016
  • Yield levels were affected due to the El-Nino phenomenon.
  • Shortage of 10,000 workers.
  • Voluntary withdrawal of the RSPO certification.
  • Increase in minimum wage from RM900 to RM1,000.
    		•
    2017
  • Operations started to recover from the impact of the El-Nino phenomenon.
  • Impact of the increase in minimum wages.
  • Labour shortage continued
  • Received the RSPO certification for 8 mills at the end of 2017.
    		•
    2018
  • Labour shortage persisted in the early part of the year, but improved in Q3.
  • Transformation Plan implemented in Q3.
  • Increase in minimum wages, from RM 1,000 to RM1,100.
    		•

    LLA Payments

      Note:

    • * Decrease in LLA fixed payment starting 2016 was due to adjustment in hectarage leased
    • FGV has paid FELDA a total of RM2.22 billion from 2012 to 2018 for the leased land, including profit sharing.
    • The LLA profit sharing moved in tandem with the CPO prices.
    • However, despite higher CPO prices in 2016, the profit sharing was lowered compared to 2013 and 2014, as the production volume reduced significantly due to the El Nino phenomenon.