“Our dedication to sustainability and innovation has been a driving force behind our strategic efforts over the past few years, which have yielded significant results.”
This year’s theme “Building on Strategic Achievements” reflects the commendable culmination of our strategic five-year plan, which has driven significant growth and transformation across the organisation.
Over the past five years, our focused initiatives have strengthened our market position, enhanced operational efficiencies, and fostered sustainable development. These strategic achievements not only underscore our resilience and adaptability but also set a robust foundation for our future endeavours.
With the conclusion of this successful chapter, we are excited to embark on our next strategic plan with renewed vigour and confidence. The insights and lessons gained from our past experiences will guide us in navigating the evolving business landscape, ensuring sustained value creation for
our stakeholders. Our commitment to sustainability and innovation remains unwavering as we continue to build on our successes and strive for even greater performance in the years ahead.
Together with our dedicated employees, valued partners, and loyal shareholders, we look forward to achieving new milestones and driving IOI towards a more vibrant and enriching future.
Progressing on Strategy. | Embedding Sustainability. |
By leveraging sustainable agriculture as | a solution to global environmental challenges, |
W E | A R E : |
Revitalising | Meeting Rising | Reducing Greenhouse | Countering |
Local Economies | Demand | Gas Emissions | Climate Change |
Improving | Achieving | Creating | Nurturing |
Nutrition | Better Yields | Healthy Soil | Biodiversity |
Building on Strategic
Achievements
This year’s Annual Report is a testament to IOI Corporation Berhad’s (“IOI” or the “Group”) strategic vision, our commitment to sustainability, and our readiness to embrace new opportunities and challenges.
The theme “Building on Strategic Achievements” encapsulates the essence of IOI’s five-year strategic plan. Our transformation into a high value-added, diversified palm-based products producer has significantly enhanced our resilience and competitiveness. This transformation has been driven by the three enablers: Human Capital Development & Culture, Sustainability and Technology & Digitalisation.
The vivid and vibrant painting of the report symbolises completion and fulfilment as well as represents the culmination of the Group’s strategic efforts and the vibrant future we envision. The inclusion of five gold laurels serves as a tribute to the strategic priorities that have guided us to this point, highlighting the successful conclusion of our five-year plan.
55th
Annual General
Meeting
Millennium Ballroom 1 (Level 1), | Tuesday | ||||||||||||||||||||||||||||||||||||||
Le Méridien Putrajaya, | 5 November 2024 | ||||||||||||||||||||||||||||||||||||||
Lebuh IRC, IOI Resort City, | |||||||||||||||||||||||||||||||||||||||
62502 Putrajaya, Malaysia. | 10:00 am (Malaysia time) | ||||||||||||||||||||||||||||||||||||||
For a bite-sized version of our report, please scan the QR code or log on to:
https://www.ioigroup.com/investor-relations/reports
Inside
This
REPORT
01
GROUP OVERVIEW
Who We Are & What We Do | 8 |
Global Presence | 10 |
Local Presence | 12 |
Awards | 14 |
Highlights of the Year | 16 |
Why Invest in IOI | 17 |
05
PERFORMANCE REVIEW
Key Indicators | 62 |
Five-Year Financial Highlights | 63 |
Group Financial Overview | 64 |
Group Performance Highlights | 66 |
Group Quarterly Results/ | 67 |
Financial Calendar | |
Group Financial Review | 68 |
Group Business Review: | |
- Plantation | 72 |
- Resource-Based Manufacturing | 78 |
02
KEY MESSAGES
Chairman’s Statement | 20 |
Group Managing Director and | 24 |
Chief Executive’s Statement |
06
GOVERNANCE
Corporate Information | 85 |
Profile of Directors | 86 |
Senior Management Team | 90 |
Corporate Governance Overview | 96 |
Statement | |
Audit and Risk Management | 112 |
Committee Report | |
Statement on Risk Management | 122 |
and Internal Control | |
Statement of Directors’ Interests | 127 |
Shareholdings of Senior | 128 |
Management Team | |
Other Information | 129 |
03
STRATEGIC VALUE CREATION
Value Creation Model | 32 |
IOI’s Case for a Greener | 34 |
Future through Innovation and | |
Partnership | |
Material Matters | 36 |
External Environment | 40 |
Risk Management | 44 |
Stakeholders’ Engagement | 46 |
07
FINANCIAL REPORT
Directors’ Report | 134 |
Financial Statements | 141 |
04
STRATEGIC PROGRESS
Strategic Framework | 50 |
Strategic Enablers | 51 |
Strategic Priorities | 54 |
08
ADDITIONAL INFORMATION
Group Properties | 254 |
Shareholders’ Information | 260 |
Glossary | 263 |
Notice of AGM | 267 |
Proxy Form |
About
THIS REPORT
IOI Corporation Berhad (“IOI” or the “Group”) has embarked on an integrated reporting journey since 2019. This is our sixth Integrated Report (“Report”) representing a clear and comprehensive corporate reporting to better meet the needs of various stakeholders and achieve greater business benefits.
We aim to enhance reporting connectivity and provide stakeholders a more holistic view of how we create and sustain value, as well as our strategic direction going forward.
Our Report consists of an Integrated Report and Sustainability Report to provide further details and clarity on our performance on these fronts.
FORWARD-LOOKING STATEMENTS | ASSURANCE |
This Report contains certain forward-looking | The Board has applied its collective mind to present |
statements with respect to IOI’s future | IOI’s Report and acknowledge its responsibility |
performance and prospects. While these | to ensure the integrity of this Report, through |
statements represent our judgements and | good governance practices and internal reporting |
future expectations at the time of preparing | procedures. This Report was approved by the Board |
this Report, a number of emerging risks, | on 11 September 2024. |
uncertainties and other important factors | |
could cause actual results to differ materially | Tan Sri Peter Chin Fah Kui |
from our expectations. These include factors | Non-IndependentNon-Executive Chairman |
that could adversely affect our business and | |
Dato’ Lee Yeow Chor | |
financial performance. We would like to | |
clarify that the Group makes no express or | Group Managing Director and Chief Executive |
implied representation or warranty that the | |
results targeted by these forward-looking | |
statements will be achieved. |
REPORTING SUITE
Integrated Report 2024 (“IR”)
This report provides an integrated review of the Group’s holistic performance,
REPORTING PERIOD, SCOPE AND BOUNDARY
This Report covers our financial and non-financial performance during the period of 1 July 2023 to 30 June 2024.
The scope of this Report covers all of IOI’s businesses in Malaysia and other countries we operate in. This includes operations for which we have full control, subsidiaries, associate companies and joint ventures. It excludes detailed information on investments in which the Group holds a minority stake.
The boundary of the Report is beyond financial reporting and includes non- financial performance, risks, opportunities and outcomes attributable to or associated with our key stakeholders who have a significant influence on our ability to create value.
For a holistic view of our business, this Report should be read in conjunction with the information available on our website at www.ioigroup.com.
REPORTING FRAMEWORK
This Report has been prepared in accordance with the International Framework set by the International Integrated Reporting Council (“IIRC”) and the Main Market Listing Requirements of Bursa Malaysia. This Report has also been prepared in accordance with the Global Reporting Initiative (“GRI”) Standards 2021 and with reference to the International Sustainability Standards Board (“ISSB”) standards while the climate-related disclosures are aligned with the recommendations of the Task Force on Climate-Related Financial Disclosures (“TCFD”).The financial report is aligned with the Malaysian Financial Reporting Standards (“MFRS”), IFRS Accounting Standards, Malaysian Code on Corporate Governance 2021 and the requirements of the Companies Act 2016 in Malaysia.
KEY FRAMEWORKS APPLIED | IR | SR |
Main Market Listing Requirements | x | x |
Malaysian Code on Corporate Governance | x | x |
| International Integrated Reporting Framework | x | x |
Companies Act 2016 | x | |
Malaysian Financial Reporting Standards | x | |
IFRS Accounting Standards | x | |
Sustainability-related indices criteria such as | x | x |
FTSE4Good Bursa Malaysia Index | ||
GRI Universal Standards 2021 | x | x |
GRI Sector Standards 2021: GRI 13 | x | x |
International Sustainability Standard Board | x | x |
Recommendations of the Task Force on | x | x |
Climate-Related Financial Disclosures | ||
NAVIGATION ICONS | |||
Strategic Priorities | Our Six Capitals | Our Risks | |
Increase Yield | Human | R1 | Business Resilience |
Optimise Workforce | Natural | R2 | Global Economic Downturn |
Diversify Crops | Financial | R3 | New Trade Regulations |
Increase the Non-CPO Segment | Manufactured | R4 | Supply Chain Compliance |
Grow the Oleochemical Segment | Social and Relationship | R5 | Reliance on Manual Workers |
Intellectual | R6 | Environmental Sustainability |
Our Material Matters | Our Key Stakeholder Groups | ||||
M1 | Health and Safety | M6 | Fire Management | S1 | Employees |
M2 | Climate Change and Greenhouse | M7 | Circular Economy and Waste | S2 | Customers |
Gas Emissions Management | Management | S3 | Communities | ||
M3 | Human Rights and Good | M8 | Energy Management and | S4 | Suppliers |
Labour Practices | Operational Eco-efficiency | ||||
M4 | Grievance Mechanism and | M9 | Regulatory and Third-Party | S5 | Regulators |
Transparent Communication | Compliance | S6 | Shareholders and Investors | ||
M5 | Traceability and Responsible | M10 | Biodiversity and | S7 | |
Sourcing | Conservation | Industry Associations/ | |||
Civil Societies |
governance and risk framework, business strategy, future direction and detailed accounting of the year’s financial performance.
Sustainability Report 2024 (“SR”)
This report details our efforts and commitment towards ensuring holistic and sustainable growth through the long term.
8 | IOI Corporation Berhad | Annual Report 2024 |
Who We Are
& WHAT WE DO
IOI Corporation Berhad (“IOI” or the “Group”), listed on the Main Market of Bursa Malaysia Securities Berhad, is a leading global integrated and sustainable palm oil player.
Employing around 28,000* people in several countries, we are a fully integrated corporation that undertakes the plantation and resource-based manufacturing businesses.
Our plantation business covers Malaysia and Indonesia while our downstream resource-based manufacturing business includes refining of palm oil, manufacturing of oleochemical and specialty oils and fats products as well as converting oil palm trunks into sustainable palm wood panels with strong presence in Asia, Europe and USA.
* Refer to Corporate Governance Overview Statement on page 100 for more information.
OUR PURPOSE
Committed to sustainable agriculture and innovative products.
Group Overview | Key Messages | Strategic Value Creation | Strategic Progress | Performance Review | Governance | Financial Report | Additional Information | 9 |
Plantation | crop and development (“R&D”) centres and one biotechnology centre across |
Plantation is a core business of IOI. We are engaged in the cultivation of oil palm | |
and processing of palm oil with operations in seed breeding, cultivation and | |
oil extraction. Today, we have 98 estates, 14 palm oil mills, four research | |
Malaysia and Indonesia. |
Contribution to | FFB Yield | Total Planted Area | Total FFB Production | |
Segment Results | (Per Hectare) | OER | (Hectares)# | (Million MT) |
79% | 19.34 MT | 21.77% | 176,202 | 2.80 |
Our Mission is to achieve responsible and
FFB: Fresh Fruit Bunches | OER: Oil Extraction Rate | # Excludes area owned by |
associate companies |
VISION
CORE
VALUES
Our Vision is to be a leading and sustainable
Malaysian business corporation with global presence.
Integrity
Commitment
Team Spirit
sustainable commercial success by addressing the interests of all our
MISSION stakeholders, caring for the community and the environment, and adopting best practices to be globally competitive.
Cost
Efficiency
Innovation
Excellence in
Execution
The Group’s global resource-based manufacturing business, comprising our refining, oleochemical, specialty oils and fats, and palm wood sub-segments, plays an important role in fortifying our integrated palm value chain.
It consists of downstream activities such as refining of crude palm oil (“CPO”) and palm kernel oil, and processing of refined palm oil and palm kernel oil into oleochemical and specialty oils and fats products as well as converting oil palm trunks into sustainable palm wood panels.
Resource-Based Manufacturing
Contribution to | Manufacturing | Combined Annual | Combined Annual Refining | Export to over |
Segment Results | Facilities* | Oleochemical Capacity (MT) | Capacity (Million MT) | |
21% | 6 | 890,000 | 1.8 | 80 |
* Excludes associate companies | Countries Worldwide |
10 IOI Corporation BerhadAnnual Report 2024
Global
PRESENCE
EXPORTS BY REGIONS
Group Overview | Key Messages | Strategic Value Creation | Strategic Progress | Performance Review | Governance | Financial Report | Additional Information | 11 |
Plantation: Estate & Mill | Resource-Based Manufacturing | Sales/Procurement/Regional Office | |
~ Associate (Bunge Loders Croklaan Group BV) | ^ Includes plasma estates | # Includes associate companies | + Excludes sales of palm kernel expellers |
Oleochemical | Commodity + | |
Asia | 79.9% | 45.3% |
Africa | 1.5% | 3.2% |
Europe | 11.0% | 43.7% |
North America | 4.1% | 7.1% |
South America | 3.3% | - |
ROW | 0.2% | 0.7% |
(Rest of the World)
18 | 21 | 19 |
20 |
NORTH AMERICA
- Channahon, USA ~
- New Jersey, USA
- New Orleans, USA ~
- Toronto, Canada ~
SOUTH AMERICA
22. Sao Paulo, BraziI | ~ | 22 |
OPERATING HIGHLIGHTS
Plantation Total FFB Production
2.80
8
7 | 10 | ||||
14 | |||||
11 13 | |||||
9 12 | |||||
17
6
15 16
AFRICA
- Bobo Dioulasso, Burkina Faso ~
- Tema, Ghana ~
- Cairo, Egypt ~
ASIA
1. | Malaysia # | ||||
2. | Xiamen, The People’s | ||||
Republic of China ~ | |||||
3 | 3. | Shanghai, The People’s | |||
Republic of China ~ | |||||
2 | 4. | Kalimantan, Indonesia | |||
Plantation: Estate & Mill - | |||||
PT Berkat Nabati Sejahtera 1-4 Estates ^ | |||||
5 | PT Bumi Sawit Sejahtera 1-4 Estates ^ | ||||
PT Kalimantan Prima Agro Mandiri 1-4 | |||||
1 | Estates ^ | ||||
4 | PT Sukses Karya Sawit 1-3 Estates ^ | ||||
& Palm Oil Mill | |||||
EUROPE | 5. | Manila, The Philippines ~ | |||
7. | Rotterdam, The | Netherlands | 6. | Dubai, United Arab Emirates | |
8. | Wormerveer, The | Netherlands ~ |
- Witten, Germany
- Hamburg, Germany
- Wittenberge, Germany
- Varese, Italy ~
- Warsaw, Poland ~
- Moscow, Russia ~
Combined Annual | Combined Annual | Resource-Based |
Manufacturing | ||
Refining Capacity | Oleochemical Capacity | |
1.8 | 890,000 |
Million MT | Million MT | MT |
12 | IOI Corporation Berhad | Annual Report 2024 |
Local
PRESENCE
Group Overview | Key Messages | Strategic Value Creation | Strategic Progress | Performance Review | Governance | Financial Report | Additional Information | 13 |
Penang Port | 37 | ||||||||||||||
PENANG | |||||||||||||||
Penang | |||||||||||||||
International | |||||||||||||||
Airport | |||||||||||||||
Sultan Azlan | |||||||||||||||
Shah Airport | |||||||||||||||
Kuantan Port | |||||||||||||||
PAHANG | Sultan Ahmad | ||||||||||||||
Shah Airport | |||||||||||||||
SELANGOR | 3 | 4 | |||||||||||||
2 | 5 | 6 | |||||||||||||
Port Klang | IOI | 1 | 9 | ||||||||||||
8 | |||||||||||||||
West Port | HQ | ||||||||||||||
NEGERI | |||||||||||||||
7 | |||||||||||||||
Plantation (Peninsular Malaysia) | SEMBILAN | 11 | |||||||||||||
KLIA | |||||||||||||||
10 | |||||||||||||||
1. | IOI Palm Biotech | ||||||||||||||
13 | 42 | 14 | |||||||||||||
2. | Bukit Dinding Estate | 12 | |||||||||||||
MALACCA | JOHOR | ||||||||||||||
3. | Detas Estate | 15 | |||||||||||||
Senai | Kuching | ||||||||||||||
4. | Bukit Leelau Estate | ||||||||||||||
International | International | ||||||||||||||
5. | Leepang A Estate & Laukin A Estate | Airport | Airport | ||||||||||||
39 | |||||||||||||||
6. Mekassar Estate & Merchong Estate | |||||||||||||||
38 40 | |||||||||||||||
7. | Pukin Estate | Tanjung | |||||||||||||
8. Shahzan IOI 1 Estate & | Pasir | ||||||||||||||
Pelepas Port | |||||||||||||||
Shahzan IOI 2 Estate | Gudang | ||||||||||||||
Port |
- Bahau Estate & Kuala Jelei Estate
- IOI Research Centre & Regent Estate
- Gomali Estate, Paya Lang Estate & Tambang Estate
- Bukit Serampang Estate & Sagil Estate
- Segamat Estate
- Kahang Estate
- Pamol Barat Estate, Pamol Timur Estate,
Organic Barat Estate, Organic Timur Estate, | Main Port | North-South Expressway |
Mamor Estate, Unijaya Estate & Pamol | Main Airport | East Coast Expressway |
Research Centre (Kluang) | ||
~ | Associate (Bunge Loders | |
Palm Oil Mill | Croklaan Group BV) | |
Kota Kinabalu
International
Airport
34
SARAWAK
Plantation (East Malaysia)
- Baturong 1-3 Estates
- Cantawan Estate
- Unico 6 Estate
- Halusah Estate
- Tas Estate
- Unico 1-5 Estates
- Morisem 1-5 Estates
- Leepang 1-5 Estates
- Permodalan 1-4 Estates
- Syarimo 1-9 Estates
26. Bimbingan 1-2 Estates
33
32 | Sandakan Airport | ||||||
28 | 31 41 36 Sandakan Port | ||||||
27 | 26 | 29 | 22 23 | ||||
30 | 24 21 | ||||||
25 | 19 | ||||||
SABAH | 20 | 18 | 35 17 | ||||
Lahad Datu Port | |||||||
Lahad Datu | |||||||
16 | Airport | ||||||
Tawau Port | Tawau Airport |
Resource-Based
Manufacturing
- IOI Oleochemical Operations
- IOI Pan-Century Oleochemical & Refinery Operations
- Lipid Enzymtec Plant ~
- Palm Oil Refinery & Specialty Fats Operations ~
- IOI Palm Oil Refinery & Kernel Crushing Plant
- IOI Palm Wood
- Mayvin 1-2 & 5-6 Estates & Tangkulap Estate
- Laukin Estate
- Ladang Sabah Estates, IOI Research Centre & Sandakan Regional Office
- Linbar 1-2 Estates
- Sakilan Estate
- Pamol Sabah Estates & Pamol Sabah Research Centre
- Sugut Estate
- Sejap Estate & Tegai Estate
- Lahad Datu Regional Office
- Sandakan Regional Town Office
14 | IOI Corporation Berhad | Annual Report 2024 |
Awards
Highest Growth in Profit After Tax Over Three Years
(Big Cap Companies)
IOI Corporation Berhad
(The Edge Billion Ringgit Club & Corporate Awards 2023)
Highest Growth in Profit After Tax Over Three Years (Plantation)
IOI Corporation Berhad
(The Edge Billion Ringgit Club & Corporate Awards 2023)
Best Corporate Responsibility Initiatives
IOI Corporation Berhad
(The Edge Billion Ringgit Club & Corporate Awards 2023)
Gold Award for Plantation Sector (Equities Category)
IOI Corporation Berhad
(The Edge Malaysia ESG Awards 2023)
Silver Award for Innovation Zone Best Active
Ingredient
IOI Oleo GmbH
(2023 in-cosmetics Asia Awards)
Company of the Year (Best in Green, Education and
Social Initiatives) under the Conglomerate –
Plantation Category
IOI Corporation Berhad
(Sustainability and CSR Malaysia Awards 2023)
ASEAN Enterprise Innovation Award (Malaysia)
IOI Corporation Berhad
(ASEAN Innovation Business Platform (AIBP) Awards 2023)
Gold in Community Awareness & Emergency
Response Code
IOI Pan-Century Oleochemicals Sdn Bhd
(Chemical Industries Council of Malaysia (CICM)
Responsible Care Awards 2021/2022)
Gold in Employee Health & Safety Code
IOI Pan-Century Oleochemicals Sdn Bhd
(Chemical Industries Council of Malaysia (CICM)
Responsible Care Awards 2021/2022)
Group Overview | Key Messages | Strategic Value Creation | Strategic Progress | Performance Review | Governance | Financial Report | Additional Information | 15 |
Gold Award for Best Executive Coaching Programme
IOI Corporation Berhad
(Employee Experience Awards (EXA) 2023)
Silver Award for Best Succession Planning Strategy
IOI Corporation Berhad
(Employee Experience Awards (EXA) 2023)
Silver Award for Best Soft Skills Training Programme
IOI Corporation Berhad
(Employee Experience Awards (EXA) 2023)
Gold Sustainability Rating
IOI Pan-Century Oleochemicals Sdn Bhd
(EcoVadis Sustainability Rating)
Gold Sustainability Rating
IOI Oleo GmbH
(EcoVadis Sustainability Rating)
Silver Sustainability Rating
IOI Esterchem (M) Sdn Bhd
(EcoVadis Sustainability Rating)
National Occupational Safety and Health Award
(Agriculture Industry)
IOI Plantation Services Sdn Bhd (Morisem 3 Estate)
(National Council of Occupational Safety and Health
National OSH Awards 2022)
Best Employer Award
IOI Pan-Century Oleochemicals Sdn Bhd
(Employees Provident Fund, Johor)
Ingredient Maverick Award
IOI Oleo GmbH
(New York Society of Cosmetic Chemists)
16 | IOI Corporation Berhad | Annual Report 2024 |
Group Overview | Key Messages | Strategic Value Creation | Strategic Progress | Performance Review | Governance | Financial Report | Additional Information | 17 |
Highlights
OF THE YEAR
Financial | Revenue | Profit before |
Highlights | ||
Interest and Tax | ||
RM9.60billion | RM1.54billion | |
Why
INVEST IN IOI
Leading Integrated
Palm Oil Group with
Global Presence
- A fully integrated business model with upstream and downstream operations to mitigate impact of commodity price fluctuations
- Global presence in 8 countries across 4 continents
- Sales are diversified to more than 80 countries to mitigate our exposure to localised risks in any particular market
- Proven track record as one of the most efficient major palm oil producers
• IOI Palm Biotech is a leading tissue culture facility producing superior high-yieldingoil palm clonal planting materials
Efficient Palm Oil
Producer
Market
Capitalisation
RM22.95billion
Business
Highlights Implemented
Mechanised Mainline
FFB Evacuation
System at 99%
Share Price
RM3.70
Launched the first
Polyglycerol Esters (“PGE”)
in cosmetic emollient applications
Net Profit Attributable to Owners of the Parent
RM1.11billion
Developed
15 New Personal Care
applied formulations
Our strengths differentiate us from others and enable us to create and sustain long-term shareholders’ value
Well-established
and Innovative
Oleochemical
Segment
- Earliest and largest fatty acids producer in Malaysia
- Owner of 25 patents for pharmaceutical applications via IOI Oleo GmbH, Germany
- CARE Studio in Germany developed 77 formulations for personal care and cosmetic applications
of suitable estates across Malaysia
Responsible
and Sustainable
Practices
• 100% of Malaysian plantations are Malaysian Sustainable Palm Oil |
(“MSPO”) certified |
• 100% of Malaysian and Indonesian mills are Roundtable on |
Sustainable Palm Oil (“RSPO”) certified |
• A constituent of the FTSE4Good Index, 85th percentile in the FOA |
Food Products industry in the S&P Global Corporate Sustainability |
Assessment, BBB rating by Morgan Stanley Capital International |
(“MSCI”) and achieved Gold EcoVadis Sustainability Ratings |
(IOI Pan-Century Oleochemicals Sdn Bhd, IOI Oleo GmbH, IOI |
Spearheaded | Achieved |
First Organic | 40% GHG reduction in Scope 1 & 2 |
Oil Palm Estates and Palm Oil | – Ahead of our 2025 target |
Production in Malaysia & Indonesia |
Good Dividend
Acidchem Sdn Bhd) |
• Committed to No Deforestation, No New Planting on Peat and No |
Social Exploitation (“NDPE”) since 2016 and to protection of High |
Conservation Value (“HCV”) and High Carbon Stock (“HCS”) areas |
Track Record
- Policy of declaring at least 50% of normalised profit after tax and minority interest
(“PATAMI”) as dividend