UEM EDGENTA BERHAD Integrated Annual Report 2025 346 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 December 2025 33. DEFINED BENEFIT PENSION PLANS (CONTD.) (b) Unfunded defined benefit plans MEEM operates unfunded retirement plans covering all their regular employees to comply with the requirement of the Saudi Arabian Labour Law. Benefits under the plan are based on the length of service and estimated base pay at the time of resignation, retirement, death and termination of the employees’ service for reasons other than misconduct, negligence or incompetence. The pension assets and liabilities are valued on annual basis by independent actuary, taking into account gains and losses. Group 2025 RM’000 2024 RM’000 At 1 January 2,080 2,491 Charge for the year 677 764 Payments for the year (276) (583) Actuarial gain (108) (399) Exchange differences (191) (193) At 31 December 2,182 2,080 The details of net employee benefits expense recognised in income statement are as follows: Group 2025 RM’000 2024 RM’000 Current service costs 677 764 The principal assumptions used in determining defined benefit obligation of the Group are shown below: Group 2025 % 2024 % Discount rate 4.85 - 5.40 5.40 Salary increment rate 2.50 - 3.35 4.05 A quantitative sensitivity analysis for significant assumptions as at 31 December 2025 and 2024 are as shown below: Sensitivity level Increase in one percentage Decrease in one percentage 2025 RM’000 2024 RM’000 2025 RM’000 2024 RM’000 Assumptions Discount rate (311) (111) 67 124 Salary adjustment 323 135 (54) (123) The average duration of the defined benefit obligation at the end of the reporting period is 5.58 years (2024: 5.66 years).
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