FGV Annual Report 2018

45 REMAINED FOCUSED ON VALUE CREATION 01 02 05 03 07 06 04 08 09 ANNUAL INTEGRATED REPORT 2018 OVERVIEW We create value from our Intellectual Capital by capitalising on our R&D capabilities to move our products and services higher up the value chain. This includes producing more innovative products throughout the oil palm lifecycle to contribute to industry development as well as achieve returns on investment. This comes hand in hand with SDG 9: Industry, Innovation and Infrastructure. MANAGING OUR INTELLECTUAL CAPITAL AND ITS OUTCOMES The development of our Intellectual Capital is spearheaded by our R&D Cluster, comprised of four main companies: FGV Agri Services Sdn. Bhd. (FGVAS, formerly known as Felda Agricultural Services Sdn. Bhd.), FGV Fertiliser Sdn. Bhd. (FGV Fertiliser, formerly known as FPM Sdn. Bhd.), FGV R&D Sdn. Bhd. (formerly known as Felda Global Ventures Research & Development Sdn. Bhd.) and FGV Applied Technologies Sdn. Bhd. (FGVAT). FGVAS is responsible for the production of seeds, seedlings, ramets and rat bait. The company produces Yangambi, the award-winning planting material that commands a 39% market share of Malaysia’s seed market. FGV Fertiliser manufactures fertiliser while FGV R&D and FGVAT serve as the research arm for the Cluster, contributing to product development for the whole plantation supply chain. This covers the upstream and downstream segments including food and non-food products and technical services. Through the R&D Cluster, we produced 19.70 million units of Yangambi seeds for the domestic and international markets in 2018, a slight decrease from 20.60 million units produced in 2017. The lower volume is attributed to a low seed germination rate, for which we have taken mitigation actions through stringent Standard Operating Procedures (SOP) and manpower adjustments. We align our Intellectual Capital with Sustainable Development Goals (SDGs): MANAGEMENT DISCUSSION & ANALYSIS SEEDLINGS SALES VOLUME (MILLION UNITS) 2.5 2.0 1.5 1.0 1.5 3.0 2016 2017 2018 2.89 2.45 1.96 SEEDS SALES VOLUME (MILLION UNITS) 20 15 10 5 25 2016 2017 2018 21.26 20.60 19.70 FERTILISER SALES VOLUME (MILLION MT) 0.1 0.7 0.6 0.5 0.4 0.3 0.2 0.8 2016 2017 2018 0.64 0.72 0.60 INTELLECTUAL CAPITAL