Outgoing group chief executive officer Haris Fadzilah Hassan said the group, however, expected the sugar business to continue improving its operating and financial performance.
“In 2021, our focus will be on new value creation for our downstream business. This is integral to our vision to reposition FGV as a leading agribusiness player.
“So far, we are on track with the implementation of our strategies and action plans to realise this aspiration,” he said in FGV’s 2020 annual integrated report released today.
On prospects, he said there was cause for optimism with the forecast of CPO prices hovering above RM3,000 per tonne next year.
He said equally encouraging was the weather conditions that had resulted in improved harvests after a 4% contraction of fresh fruit bunches in 2020.
“These gains, however, can be affected by reduced demand from the hospitality, restaurant and catering industry (HoReCa) should the Covid-19 pandemic continue,” he said.
He said HoReCa customers made up a significant market for FGV’s palm oil and consumer products.
Haris Fadzilah expressed confidence that post-pandemic, FGV would be well-positioned to benefit from the development of its consumer products, integrated farming and renewable energy businesses as these segments were market-driven and not subject to commodity price volatility.
On plantations, he said FGV would continue to address sustainability matters that were vital to meet its Certified Sustainable Palm Oil production targets.
“Based on our current momentum, we are committed to achieving 100% traceability to plantations by our mills in 2021.
“We also look forward to the renewal of our Roundtable on Sustainable Palm Oil certification schedule and the lifting of restrictions on our exports by the US Customs and Border Protection,” he added.
For the financial year ended Dec 31, 2020, FGV returned to the black after recording a net profit of RM146.16 million compared with a net loss of RM246.18 million in the preceding year.
Earlier this month, FGV announced that Haris Fadzilah would step down as group CEO effective May 15 and the board would look for a suitable candidate to replace him.