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Fima CORPORATION Berhad
(197401004110) (21185-P) •
Annual Report 2020
40
in this current financial year. The rollout
of the upgraded IT system across all our
Malaysian estates which commenced in 2018
has been completed during the year. The
new IT systemwould provide the Group’s
head office more visibility and control of the
estates’ operations.
Sustainability Standards Certification
All of our developed Malaysian estates have
successfully attained MSPO certification.
Selected employees have been sent
for training to ensure that we have the
necessary competencies to maintain and
support our MSPO certification. However,
the Indonesian Sustainable PalmOil
(“ISPO”) audit on PTNJL remains status
quo from last year as authorities await a
definitive outcome of the ongoing legal suit
pertaining to PTNJL’s HGU before the ISPO
certification process can be resumed.
Outlook
The palm oil industry continues to
be challenging in light of geopolitical
uncertainties, protectionist policies namely
and in particular, the EU resolution to ban
palm-related biodiesel by January 2021,
as well as the impact of the prolonged
Covid-19 pandemic on the demand for palm
oil products and overall global economic
growth. The division could also potentially
be faced with labour supply uncertainties if
the country’s borders continue to be closed
due to the pandemic for extended periods.
On this note, we are aware that we have to
step up our already on-going mechanisation
and automation initiatives to further reduce
our dependency on manual/foreign labour,
drive productivity and cost-efficiency.
The rollout of the
upgraded IT system
across all our
Malaysian estates
which commenced
in 2018 has been
completed during
the year.
While more areas are expected to attain
maturity in this current financial year, we
expect the division’s earnings to continue
experiencing pressures in the near term
as a result of the required expenditure
in developing our Malaysian estates.
Nevertheless, we believe that on balance,
this sector will continue to benefit from
the growing demand given that palm oil is
a significant and versatile rawmaterial for
both food and non-food (i.e. oleochemicals
and biofuel) industries and is confident of
its sustainable growth over the long-term.
Further, expanding the Group’s plantation
landbank has been and remains the long-
standing objective of the Group. As such,
we continue to see significant opportunities
to grow the division through acquisitions
as the Group’s strong capital structure
continues to provide us with the flexibility to
invest for future growth.
plantation Division : taking root