MSM Malaysia Holdings Berhad Annual Report 2019

This year’s cover depicts MSM Malaysia Holdings Berhad’s diverse product offerings within a balanced layout to reflect the Group’s commitment to seek new market opportunities to optimise on its current expanded production capabilities. Challenged by increased competition due to the liberalisation of the country’s sugar industry and increased market supply conditions, MSM is steadfastly realising its global and domestic expansion plans and activating key strategies towards achieving a fortified and more balanced value chain. These include diversifying into newproduct lines and emerging a more strategic downstream presence through merger and acquisition explorations. MSM’s Board of Directors and Senior Management, has approved the contents of this Annual Report, guided by the requirements of the MCCG 2017, Companies Act 2016, the Main Market Listing Requirements of Bursa Malaysia and Sustainability Guidelines. The financial report and statements have been audited by PricewaterhouseCoopers PLT and is approved free of qualifications. The Board acknowledges responsibility for ensuring the integrity recommendations of the annual report, following recommendation by the Audit Committee, responsible for oversight of the integrated annual report. MSM’s integrated reporting process is intended to move beyond compliance to generate meaningful and inclusive discourse with our stakeholders with the aim of informing our strategy and building trust. We value feedback and welcome questions or comments on our reports. To share feedback, please contact our Investor Relations unit at +603 2181 5018 or e-mail us at Certain statements in this report regarding MSM’s operations may constitute forward-looking statements. These statements can be identified by key words such as “believes”, “estimates”, “anticipates”, “expects”, “intends”, “may”, “will”, “plans”, “outlook” and other words of similar meaning in connection with a discussion of future operating or financial performance.These statements relate to the plans, objectives, goals, strategies, future operations and performance of MSM. Actual results and outcomes may differ materially from those projected in any forward looking statements due to various events, risks, uncertainties and other factors. We neither intend to nor assume any obligation to update or revise any forward looking statements, whether as a result of new information, future events or otherwise. The aim of MSM’s Annual Report is to provide a transparent, balanced and accessible narrative and analysis of our strategy, performance and prospects in relation to material, financial, economic, social, environmental and governance matters. Our reporting encompasses all material developments concerning MSM up until the approval of the annual financial statements. It focuses on MSM as a Group and encompasses our operating subsidiaries, i.e. MSM Prai Berhad, MSM Perlis Sdn Bhd, MSM Logistics Sdn Bhd and MSM Sugar Refinery (Johor) Sdn Bhd. Financial and non-financial data from our subsidiaries are consolidated for ease of reference. We have also included pertinent information that should assist stakeholders in making an informed assessment of MSM and how we are able to strategically create and sustain long-term stakeholder value. The material matters and developments which are covered in the report were determined by taking into account the following considerations: • Quantitative and qualitative criteria and factors in relation to MSM’s business and operations • Matters critical to achieving our strategic objectives and creating long- term value for our stakeholders • Matters covered in reports submitted to the Board of Directors for discussion or approval • Material risks identified by our risk management process • Key stakeholders’ interests All material matters and developments thereof for the reporting year under review can be found within Shaping Material Matters on page 10 and Management Discussion & Analysis (MD&A) from page 21 onwards. ABOUT THIS REPORT This report has been compiled in accordance with the concepts, guiding principles and content elements contained in the IIRC framework. This framework employs a reporting approach to create short, medium and long-term value as well as the connectivity and interdependencies of the six capitals, namely human, natural, manufactured, financial, intellectual, and social & relationship capital. The report provides a complete and balanced review of MSM and its subsidiaries on the Economic, Environmental and Social (EES) performance within the context of its strategy, risks and opportunities for the period of 1 January 2019 to 31 December 2019. This report adheres to the guidelines laid down within Bursa Malaysia Securities Berhad’s (Bursa Malaysia) Main Market Listing Requirements and Sustainability Guidelines. It also complies with requirements for EES reporting as outlined under the Global Reporting Initiative (GRI). Compliance with Malaysian legal requirements under the Companies Act 2016 and Malaysian Code on Corporate Governance 2017 (MCCG 2017) has also been adhered to. SCOPE AND BOUNDARIES ASSURANCE AND APPROVAL FEEDBACK FORWARD LOOKING STATEMENTS DETERMINING MATERIALITY