Fraser & Neave Holdings Bhd Annual Report 2021

OUTLOOK & GOING FORWARD As we enter FY2022, the number of daily COVID-19 cases has been declining at an encouraging pace in both Malaysia and Thailand. Movement restrictions are gradually easing, and there are positive signs that the economies in both countries will pick up. Nevertheless, the Group remains cautious given ongoing market challenges and global uncertainties. We do not expect the market to return to pre-pandemic conditions anytime soon and foresee that commodity prices will remain inflated moving forward. At the same time, we are prepared to ride on the encouraging return of economic activities in Malaysia and Thailand to drive sales, particularly for our beverages, ready-to-drink dairy business, and out- of-home channels. We will continue to offer products that meet consumers’ evolving needs and refine our pricing to cushion our businesses against cost pressures. These actions, coupled with the restructuring exercise just completed in the last financial year, will put us in good stead against imminent risks while keeping us on track to drive future growth. Exports will continue to be a key focus for both Malaysia and Thailand. Having achieved strong growth in a full year of pandemic, we look forward to even better performance in FY2022 when the global landscape stabilises. We will not shy away from investing in capability to tap into new opportunities, be it for our own branded exports or those of key OEM customers. With Sri Nona in our portfolio, we have good leverage to further grow our Halal Packaged Food pillar and will be exploring various options – organic or otherwise – towards this end. We have a RM3 billion sukuk programme at our disposal that we can draw down when the right opportunity presents itself. We are also investing to become a halal thought leader, and the HDC Halal Excellence Award that we won in FY2021 indicates that we are already making a mark in this direction. In 2022, the Group targets to achieve further operational and cost e!ciencies, and carbon footprint reduction with the completion of several capex investment projects, such as the integrated warehouse in Shah Alam, drinking water line in Kota Kinabalu, Regional Distribution Center in Rojana, and the installation of 10MWp Solar PV systems in Malaysia. Our new sustainability framework towards Better Business, Better Society and Better Planet, and commitments for 2025, will accelerate our Economic, Social and Environmental progress to build a stronger future for the Group, and create long-term value for our stakeholders. As Malaysia enters the recovery phase of the pandemic, a key priority is to assist our trade partners to recover as quickly as possible to benefit from the easing of economic activities. At the same time, we continue to keep our people safe with proactive preventive measures and support vulnerable groups within our community as they gradually regain their livelihoods. While gearing up for economic recovery, we will remain focused on implementing our mid to longer-term strategic initiatives that will enable us to respond to challenges and opportunities with confidence and conviction. We especially look forward to rolling out Reimagine 2.0 initiatives, which build on our PASSION 2025 roadmap, focusing on three domains: • Building new capabilities to enhance our business through better products and route-to-market, as well as by partnering with stakeholders to grow sustainably; • Strengthening our leadership in core markets via increased focus on our supply chain, process innovation and digitalisation, as well as portfolio management; • Unlocking our potential to enhance shareholder value through strategic partnerships, improving the value of our assets, and developing a world-class workforce. While gearing up for economic recovery, we will remain focused on implementing our mid to longer-term strategic initiatives that will enable us to respond to challenges and opportunities with confidence and conviction 038 CHI EF EXECUT IVE OFF ICER’S STATEMENT