the Bulking division operates five liquid bulk terminals of which three are located in north port in port klang and two in Butterworth.
Presently, these terminals have 275 tanks with a combined storage tank capacity of 278,790 MT and can handle a wide range of liquid cargoes ranging from palm oil products to latex concentrates, oleochemicals to specialty oils, as well as petroleum products, industrial chemicals and technical fats.
These terminals also provide storage facilities for import and export, transhipment, containerization, local dispatch, heating, nitrogen blanketing and drumming of liquid products. Other services provided by the Bulking Division include customs declaration, freight forwarding, break-bulking, trucking and related logistics businesses.
Pow e r in g on
Rm106.67 Million
31.4% Increase Y-o-Y (FYE2019: RM81.15 Million) ReVeNue
Rm35.29 Million
18.2% Decrease Y-o-Y (FYE2019: RM43.13 Million) PROFIT BeFORe TAX
BulKING
Revenue increased to an all-time high of RM82.09 million while profit before tax (“PBT”) decreased slightly to RM41.76 million. For FYE2020, the division is the leading
contributor of the Group’s PBT at 80.6%.
Throughput grew 3.2%
year-on-year (“y-o-y”) led by strong growth particularly in the edible oils, industrial chemicals and used cooking oil (“UCO”) product segments. The increase in edible oils throughput particularly at our Butterworth terminals was
supported by the high levels of CPO inventories while the increasing volumes for UCO, which was driven by strong customer growth, had more than offset the decline in base oil and technical
FYe2020 keY FocuS AReAS
capacity expansion
customer Growth
handling of new products
Accreditations and Value chain transparency
fats at our Port Klang terminals.
Further, performance of our freight- forwarding and haulage subsidiaries continue to remain healthy, with volume and revenue contributions from this segment increasing 13.1% and 36.0%
respectively, y-o-y.
Average tank utilisation rate was 95% led by higher volumes achieved in the edible oils, industrial chemicals and UCO segments.
This increase was also underpinned by the higher proportion of long-term contracts secured by our terminals in North Port, Port Klang, compared to spot contracts. Moreover, the negative impact of Covid-19 on our operations has been relatively modest in FYE2020 as our industry is considered as an essential service
5-Year Revenue &
PBT Performance (RM Million)
20’ 35.29
106.67 19’
43.13 81.15 24.91 18’
53.54 17’
20.00 47.46 16’
38.88 67.45
Revenue PBT
+31.4%
-18.2%
Revenue Contribution by Product (%)
Edible 40.7% Oil
Oleochemicals 9.4%
Industrial Chemicals 20.9%
Base Oil 18.5%
Others 3.3%
Used Cooking Oil 7.2%
Product Throughput (MT) 1,120,820
FYE2019 FYE2020 1,086,347
bulking Division : Powering on
FYE
kumpulan Fima Berhad(197201000167)(11817-V)AnnuAl RepoRt 2020
45
Year
Throughput Breakdown (MT)
Edible Oil 498,597
Oleochemicals 66,938
Technical Fats 9,658
Industrial Chemicals 239,385
Base Oil 150,880
Latex 8,508
Used Cooking Oil 77,821
Transportation 69,033
Total 1,120,820
and was thus permitted to operate during the Movement Control Order period subject to our compliance with certain strict conditions imposed by the government.
During the year under review, we completed the construction of 4 new storage tanks with a combined capacity of 2,800 MT (or 3,340 cbm) at our terminal in North Port, Port Klang and all have been brought into service during the year. We are now proceeding with plans to expand the capacity of our Port Klang terminals by a further 17,783 MT (or 20,440 cbm). Site establishment works will commence once relevant approvals have been obtained. We expect that the project will be completed by the end of this current financial year. Increasing our capacity not only improves land utilization of our terminal but enables us to add more new products to our portfolio and handle significantly more volume over the long term and this bodes well for longer-term stability.
Bulking Group Business Model ACCReDITATIONS
CAPABIlITIeS
FACIlITIeS
INWARD OuTWARD
Discharge Shipment
Bulking Collection
Transfer Transfer
Fima Bulking Service Bhd ISO 9001:2008
Handle Wide Range of liquids
275 Tanks 275,390 MT
Fimachem Sdn Bhd ISO 9001:2008 OHSAS18001:2007
Containerization
Nitrogen Blanketing and Drumming Fima Palmbulk
Services Sdn Bhd ISO 9001:2015 ISCC-EU (Warehouse)
Fima Butterworth Installation Sdn Bhd ISCC-EU (Warehouse)
Fima Biodiesel Sdn Bhd MSPO Supply Chain Certification Standards &
ISCC-EU
Freight Forwarding/
Warehousing
Tank Gauging
& Heating 60,000 MT Per Annum Biodiesal Plant
Fima Freight Forwarders Sdn Bhd
ISO 9001:2008
Transhipment
Direct Export Pipelines
& Berthing 3 Terminals in North Port 2 Terminals in Butterworth
bulking Division : Powering on
AnnuAl RepoRt 2020kumpulan Fima Berhad(197201000167)(11817-V)
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Our capital expenditure for FYE2020 totalled RM4.08 million, with the majority allocated to the construction of the 4 new tanks referred to earlier while the remainder was spent towards maintenance and replacement of existing handling equipment, plant and machinery.
Rollout of the new tank farm inventory management system across our terminals, which commenced last year is expected to be completed in this current financial year. The solution will replace the existing software and will provide a common platform for all our terminals thereby enhancing internal controls, improving our global reporting and analysis capabilities leading to improved productivity and cross-functional efficiencies. In addition, our customers would be able to access real-time information on the movement and volumes of their stocks.
BIODIeSel
In its first full year of operations, Fima Biodiesel Sdn Bhd (“FBiodiesel”) recorded revenue of RM24.58 million and a loss before tax of RM6.47 million. As is
common with any revival of idled facilities, the plant had been operating below its optimal utilisation rate due to some restarting issues. So for this current financial year, we are stepping up efforts to improve the plant’s operational efficiencies and production capacity. Once this is achieved, we would be in a position to progressively scale up production and lock in more offtake contracts. At the moment, production is adequately backed by supply contracts and toll processing arrangements with
third parties. There is also a ready market for the glycerin generated from biodiesel production. On a separate note, we are happy to report that the plant had obtained the MSPO Supply Chain Certification Standard. This validates FBiodiesel’s position as a producer of sustainable biodiesel and reinforces our commitment to maximise economic and environmental benefits by adopting sustainable practices into our operations while simultaneously providing transparency to our customers.
FBiodiesel’s capital expenditure for FYE2020 totaled RM3.57 million, which are largely expended on repair and maintenance of the plant and machinery as well as upgrading of the water treatment plant.
We expect the biodiesel market to remain stable in this current financial year as the government’s biodiesel regulations and mandates are expected to continue supporting demand. On the other hand, and as the impact of Covid-19 comes into view, we are seeing some customers deferring delivery of the contracted volumes as many are adjusting their strategies on the back of the
supply-demand shock in the oil markets caused by the sudden massive decline in consumption.
For the longer term, our underlying view on biodiesel remains positive as we foresee that demand for sustainable energy will increase. Although currently only 4% of energy for transport, for example, comes from renewables, the International Energy Agency has projected that renewables are expected to grow significantly over the next five years1.
OuTlOOK
As noted earlier, the negative impact of Covid-19 on the division has been modest in FYE2020 and our operations have held up well in the face of the slowdown in economic activities. We are cautiously optimistic on market
improvements in this current financial year, though we note the potential risk posed by the pandemic outbreak on both operations and demand for our services. A lot will depend
on the pace, timing and geographical distribution of the market recoveries.
We are seeing continued strong demand for storage of UCO and believe that we will be able to retain some of those volumes in this current financial year. Based on current market trends, we also expect transshipment activities to remain robust. In contrast, demand for storage of edible oils is anticipated to slow down on the back of the forecasted decline in palm oil stock levels2. For this current financial year, our emphasis will be to drive organic growth through further improvements in customer offerings and by unlocking synergies within our existing asset portfolio.
1 Source: International Energy Agency – Renewables 2019 (Market analysis and forecasts to 2024).
2 Stock levels of oil palm expected to be lower in the range of 1.94 million to 2.19 million. Source : Dr Sathia Varga, Palm Oil Analytics
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MANuFACTuRe & DISTRIBuTION OF CANNeD FISH
The Group’s involvement is via its subsidiary in Papua New Guinea (“PNG”), International Food Corporation Limited (“IFC”) which manufactures and distributes canned mackerel, canned tuna and frozen tuna loins for both export and domestic markets.
Canned mackerel and tuna under IFC’s own “Besta”, “Besta McFlakes”,“BestaChoice” and
“BestaWhite” brands are produced primarily for the PNG and Solomon Island market while frozen tuna loins and private label canned tuna are exported to the European Union.
The Group’s associated company, Marushin Canneries (M) Sdn. Bhd.
manufactures and markets canned sardine, tuna and mackerel in Malaysia under the brand name “KING CUP”.
FOOD PACKAGING
KFima Group’s 100% owned subsidiary, Fima Instanco Sdn. Bhd. (“FISB”) whose principal activities are trading of products under its own “Instanco” and “Farmtree”
brands. FISB also provides contract packing services of powdered beverages and condiments for third parties.