Page 30 - MSM_AR2020

CHAIRMAN’S DELIVERING MSM MANAGEMENT DISCUSSION GROUP FINANCIAL
STATEMENT VALUE OVERVIEW & ANALYSIS REPORT

MSM

STRATEGy

PROGRESS & ACHIEVEMENT 2020

Key Strategies Priorities Progress & Achievement 2020

Cash Flow 1. Reduce stock holding Reduced raw sugar stock holding via “Just-In-Time” mechanism
Driven 2. Monetise non-core assets • Reducing raw sugar balance, optimising warehouse rental cost
and improving cash balance.
Monetise non-core assets
• Efforts to monetise non-productive and unutilised assets will be
ongoing in 2021.
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Restructure 1. Balancing production Consolidation of production in MSM Johor
MSM MALAYSIA HOLDINGS BERHAD Annual Report 2020
Business capacity within MSM • MSM Perlis refinery operations has been successfully
Group’s operation – discontinued on 30 June 2020.
th
MSM Prai and MSM
Johor • The production volume from MSM Perlis was successfully
consolidated to MSM Johor and MSM Prai whilst improving
2. Focus on product refining cost.
diversification Launch of Premium Prai’s products (Sugar Stevia Mix and Sugar
3. R&D on food and Sucralose Mix)
non-food sugar related
products • Premium Prai is an alternative sweetener brand with lower
caloric value mixtures of different types of sweeteners.
• The products are mostly sold in convenient stores with easy to
use sachets for on-the-go lifestyles.
• The small sachet size is suitable for take away use with drinks,
travel and flights.
Further exploration downstream into sugar related business
• A detailed study on the condensed milk business model was
achieved. Further R&D will be required to obtain the right recipe
and target market.
Stabilise & 1. Increase efficiency Improving production efficiency and yield
Turnaround 2. Lower refining cost • MSM Johor’s yield has improved to 90% in 2020 compared to
– energy cost saving 88% in 2019.
strategies Energy cost saving projects are being explored
3. Increase export of value • Biomass Boiler project and Solar photovoltaic system were
added sugar products identified to reduce energy cost and carbon footprint.
(new SKU)
• Rationalising CAPEX and prioritising the ramp up plan for MSM
Johor refinery.
• Achieved a higher production volume from higher exports helping
the plant to achieve a lower refining cost.
Export value-added sugar products (new SKU)
• In 2020, MSM has continued exporting premix, liquid sugar and
fine syrup to China.
• Capacity expansion for fine syrup was completed in 2020.
• The capacity expansion of the liquid sugar and premix facilities
in MSM Johor will be fully completed in 2021 to cater for the
increasing demand from China and other Asian markets.