FGV Annual Report 2018

22 ESTABLISHED INTEGRATED AND COMPREHENSIVE IMPLEMENTATION PLANS FGV HOLDINGS BERHAD OUR BUSINESS PLAN STOP THE DECLINE & DRIVE SUSTAINABLE GROWTH Since our listing in 2012, our operating environment has changed substantially, reflecting developments in the global economy and the matters of concern to our Stakeholders. Following this, in 2018, together with our renewed leadership aspiration, we recognised a need to review the assumptions and growth focus of the Group strategic objectives. As a result, we reviewed our (SP20 (V2)) and formulated Business Plan 2019-2021 (BP21) which will cover the years 2019 to 2021. Our BP21 was developed around the following key principles: 1 Better resource utilisation to generate higher return on assets 2 Portfolio enhancements to balance the structural inefficiencies 3 Value maximisation through integrated business value chain 4 Commercially driven and accountable business decision making 5 Optimising human capital potential in driving growth We take into account critical internal and external factors such as the strategic direction from the Board of Directors and the Management, operational challenges and the rapidly evolving industry, and market dynamics. In developing BP21, we conducted a comprehensive analysis of our existing business and asset portfolio and identified the key areas for improvement. Our strategy was then formulated to address those areas and deliver sustainable values to our Shareholders. BP21 revolves around our business activities with a primary focus on three Sectors, namely Plantation, Sugar and Logistics & Support Businesses. We have developed a set of strategies for our core businesses and support functions categorised into four Strategic Thrusts: 1 Operational Improvement Focuses on improvements across all our operations to maximise productivity, enhance quality and lower costs. In order to ensure BP21 presents a holistic view of our strategic objectives and initiatives, we incorporated the Economic, Environment and Social pillars into every aspect of our business operations. We are not only intending to grow in terms of size, but will also fully maximise our potential from being an integrated player and making sustainability our utmost priority. This helps to ensure that the drive to achieve our economic goals is balanced with efficient resource utilisation and strict adherence to corporate guardrails. We believe there are sizeable and unlimited opportunities ahead for us to explore and tap into, provided we are bold, disciplined and prepared to change our way of doing business. As we are already an integrated palm player, there are more opportunities to expand our supply chain where higher margins and higher value can be captured. However, we shall remain cautious on potential threats which could hinder our progress. 2 3 4 Products and Markets Penetration Emphasises on optimising value in our Plantation, Sugar and Logistics & Support Businesses Sectors by venturing into high-margin downstream products, specialised sugar and logistics diversification, as well as through overseas expansion. New Growth Area Identify new and synergistic areas of growth to drive our long-term performance. Financial and Capability Building Adopting initiatives to improve our financial position and human capital capabilities to drive future growth, including stricter management of our finances and right-sizing our workforce.