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Fima CORPORATION Berhad
(197401004110) (21185-P) •
Annual Report 2020
25
for us to continue to support our fellow
colleagues and local communities during
this unprecedented time of need.
Further information on our corporate
responsibility and sustainability initiatives
together with a review of their progress
can be found in the sustainability section
of this Annual Report.
Prospects
Against the backdrop of growing
uncertainty over the duration and overall
impact of the Covid-19 outbreak, the
World Bank’s GDP growth forecast for
Malaysia in 2020 has been significantly
lowered from 4.5% to -0.1% while Bank
Negara Malaysia has revised Malaysia’s
GDP projection to be between –2.0%
to 0.5% in 2020*. Premised on these
forecasts, we can expect trading
conditions will remain difficult for some
time.
(*Source: Economic and Monetary Review
2019 – April 2020, BNM, IMF and World Bank)
The Malaysian Government has
announced several relief measures
including a moratorium on repayment of
loans and wage subsidy programmes for
eligible industries. Where relevant, our
Group companies have applied for such
relief measures which will help ease the
financial position further. We are hopeful
that with the stimulus package that the
Government has put in place, businesses
will be able to tide through and provide
a boost to the recovery process after the
peak of the outbreak.
In the face of these challenges, resilience
is a vital necessity. And, if there ever was a
time to emphasise on this point, it is that
balance sheet matters. As noted earlier,
our balance sheet and cash generation
are strong while gearing remains low.
This gives us the capacity to not only
pursue our growth aspirations, but also
to withstand adverse business conditions
and hedge any potential downside risks.
Our primary focus for this current
financial year will be, firstly, to adapt
to the ongoing secular challenges and
manage the economic fallout of Covid-19
in our manufacturing division. We are
anticipating some decline in demand
for our security products with orders
for certain products being deferred or
cancelled.
Secondly, with regard to plantation,
the immediate focus will be on realising
improved returns on our greenfield assets
which we had acquired in recent years.
We expect our FFB volumes to improve
due to the young age profile of the palms
at our Malaysian estates, although
ongoing development expenditure and
volatile commodity prices may impact the
division’s overall earnings.
Be that as it may, we will continue to
future-proof and review the Group’s
structure to ensure we have the right
platform from which to pursue continued
growth and meet the challenges of an
ever-evolving, uncertain world. Agility
remains important across our businesses
and we will therefore continually strive
to refine and develop a model that can
preserve and create value, generate
sustainable returns as well as position us
for ongoing organic and acquisitive growth
opportunities. Our business fundamentals
remain strong despite the macroeconomic
challenges and uncertainties associated
with the pandemic. We will continue to
make decisions and manage the business
for the long-term. And having the financial
strength, flexibility and access to adequate
capital to support our long-term growth
plans are all key to our long-term success.
Appreciation & Acknowledgement
I would like to conclude by thanking the
Board for their guidance and high level of
commitment during the year. I would also
like to thank the Group’s management
team and employees for their dedication
and resilience in what has been another
challenging year. Finally, my gratitude to
all our shareholders, suppliers, business
partners and other stakeholders for their
continued support to the Group.
Thank you.
Dato’ Adnan bin Shamsuddin
Chairman