GROUP FINANCIAL REVIEW Key Financial Performance Indicators MSM uses several key financial indicators to measure its financial performance. These key financial indicators are: Revenue, Profit Before Tax (PBT), Return on Capital Employed (ROCE), Net Debt and Financing to EBITDA, and Cash Balance Position. The Board and Management regularly review these financial indicators to measure the Group’s performance against set targets. Revenue The Group’s revenue increased by 3.4% to RM2.26 billion in FY2021 on the back of improved selling prices across all customer segments. The Wholesale Segment posted a 14% increase in revenue to RM842 million in FY2021 (RM738 million in FY2020) despite recording lower volume from the previous year. Meanwhile, the Industries Segment’s revenue decreased by 7% at RM894 million in FY2021 (RM963 million in FY2020). Around 20% of the revenue is generated outside Malaysia. In FY2021, Export Segment’s revenue increased by 8% at RM506 million (RM467 million in FY2020) as a result of increased Premiums. Profit Before Interest, Zakat andTax (PBIZT) and ROCE PBIZT increased 83% from RM68.80 million to RM125.56 million. Due to this increase, the Group’s ROCE increased from 2.5% to 4.4%. Subject to unforeseen market conditions, we are working towards achieving a better performance in the future. Profit Before Zakat andTax (PBZT) The Group’s PBZT from Continuing operations increased 126% to RM81.10 million in FY2021 due to better raw sugar management. Discontinued operations contributed RM88.74 million in PBZT, mainly from gain from disposal of subsidiary, as mentioned above. The Group’s consolidated PBZT of RM169.84 million is a marked improvement from a loss position of RM39.24 million in FY2020. Finance Costs Finance costs increase from RM36.78 million in FY2020 to RM47.05 million in FY2021 is mainly due to a loan modification cost of RM9.75 million recorded in September 2021 from additional repayments made to the Group’s term loans of RM114.26 million. These advanced repayments represented a change in the present value of the term loan which resulted in a loan modification cost to be recorded in FY2021. In contrast, in FY2020, the Group made an additional repayment of RM40 million in December 2020 and recorded a loan modification credit of RM11.70 million. Industries Segment Export Segment Wholesale Segment Revenue Contribution (RM million) 842 894 506 WHO WE ARE STATEMENT & DISCUSSION BY OUR LEADERS HOWWE OPERATE MSM Malaysia Holdings Berhad ANNUAL INTEGRATED REPORT 2021 68
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