2021 – A CHALLENGING AND POSITIVE TRANSITION YEAR Considering that private hospitals are generally not built to handle infectious diseases like COVID-19 cases, therefore KPJ Group’s focused mainly on the public-private partnership arrangement and treating non-COVID-19 patients. KPJ group has recorded a higher revenue in 2021 as there was a greater relaxation of containment measures by the Government during the second half of the year with a gradual pick-up of demand and better economic activities. However, higher fixed costs and the incremental cost for Standard Operating Procedure compliance has resulted to a lower performance in KPJ’s EBITDA financial performance. As a long-term business partner, Al-`Aqar has granted the rental support initiative to KPJ Group. For the business segment in Australia, the establishment of the Royal Commission into Aged Care Quality and Safety and ongoing COVID-19 pandemic have continued created an uncertainty within the aged care industry. Both events have contributed to the decline in demand for senior living facilities and indirectly affected the property value of such facilities in Australia. There is no exception to our property in Australia, Jeta Gardens (“JG”), as the occupancy rate of JG has fallen from 95% in 2018 to 79% in 2020 and subsequently contributed to the negative financial performance of JG. In October 2021, with the advice from the appointed valuer, CBRE Australia, Al-`Aqar has entered into rental revision with JG, to reflect current market rate and property value. DATO’ HAJI MOHD REDZA SHAH BIN ABDUL WAHID Chairman CORPORATE OVERVIEW STRATEGIC PERFORMANCE GOVERNANCE STRUCTURE THE DRIVING FORCES SUSTAINABILITY STATEMENT FINANCIAL REPORTS 009
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