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Kumpulan Fima Berhad (11817-V) •
Annual Report 2018
Letter from the Group Managing Director
Key Focus Areas
Our strategic plan remains the same,
which is to create meaningful growth in
each of our business segments and to
deliver sustainable returns by organic
and expansionary growth, solid return
on capital employed and strong cash
generation; to be supported by cost
control and efficient practices across the
Group. Looking to the immediate future
our priorities will therefore be on growing
the bottom line through improving
operational efficiencies and ensuring
timely completion of projects under
development. We are also investing in
technology and systems to provide the
platform that will allow the Group to grow
through better management information.
Over the mid to long term, we remain
acquisitive in nature and will continue to
seek and pursue opportunities to fulfil our
growth ambitions, but as always, such
acquisitions will be considered provided
they meet the Group’s investment returns
criteria and the Board has comfort in the
Group’s gearing and funding capacity.
As you know, PTNJL was served with
an order from the Menteri Agraria dan
Tata Ruang/Kepala Badan Pertanahan
Nasional revoking PTNJL’s land title
(“HGU”) (“Ministerial Order”) on the
basis that the HGU was improperly
issued due to administrative irregularities
performed by certain officers of the
Badan Pertanahan Nasional Provinsi
Kalimatan Timur at the time of the
issuance of the HGU in 2003; resulting
in parts of the area within the HGU to
overlap with forestry areas. I am sure
shareholders are also well aware that
PTNJL is challenging the Ministerial
Order and vigorously defending the HGU
in the Indonesian courts. The ultimate
outcome of the suit cannot presently
be determined as it is currently pending
before the Mahkamah Agung. Should
developments result in a final adverse
judgment, the Board does not anticipate
that it will have further material impact
on the Group’s balance sheet moving
forward as we have recognised a gross
impairment loss of RM44.74 million
in last year’s results. However, future
earnings may be affected.
Board and Senior
Management Succession
On behalf of the Board and all Group
employees, I would like to express my
appreciation to Mohd Yusof bin Pandak
Yatim, who retired from his position
as Chief Financial Officer/Company
Secretary in end‑October 2017 after
21 years of dedicated and outstanding
service. He will be succeeded by Fadzil
bin Azaha who has been with KFIMA
since January 2016 and, coming to us
from a Big Four accounting firm, brings
with him extensive financial knowledge,
built up over 19 years of working
experience.
This coming year will also see the
retirement from the Group of two long-
serving executives: S. Kamalanathan,
Chief Executive Officer of Bulking
Division and Ahmad Zakri bin Abu Bakar,
Director of Food Division. We thank them
for their leadership and loyal service
which have made a lasting contribution
to the strength of the Group.