Yinson Annual Report 2020

8 Yinson Holdings Berhad SECTION 1 OVERVIEW Chairman’s Statement Yinson is always mindful of the need to balance between rewarding shareholders while ensuring sufficient funding in line with the Group’s business expansion plans. Share price performance Yinson’s share price grew exponentially during the year, from RM4.08 on the first day of the financial year under review to RM7.17 in early July 2019. Our strong fundamentals and contract wins, along with the positive outlook of global oil price, ensured that the share price was sustained at that level into the second half of the year. As at the date of this report, as a result of the global economy slowdown due to the Covid-19 pandemic and weaker oil price since March 2020, the share price has been hovering around RM5.00. We believe that Yinson’s strong fundamentals will ensure that the share price remains resilient and in a good position to regain its ground when the global economy recovers. Market outlook As we pen down our plans for the year ahead, we are anticipating the possibility of a global recession in the form of a double whammy caused by the collapse of oil price and the effects of a prolonged Covid-19 outbreak. It has been a bleak start to 2020 for most oil and gas companies across the supply chain, with oil prices falling below USD30 per barrel. As gloomy as it may be, our Management has steered Yinson through downcycles of the oil and gas market in 2014 before, and we are confident that we will weather the storm once again. Moving forward, against global economic headwinds, it is expected to be more challenging. By adjusting to the uncertain oil price environment, high cost producers are cutting development plans. However, some low-cost producers are still pushing forward on the development of their more prolific fields. The next market which Yinson will venture into is Brazil. Brazil’s Petróleo Brasileiro S.A. (“Petrobras”) is still issuing tenders, with one of them being a tender for the Mero-4 floater, despite the current economic situation. With that said, we opine that there will still be contracts to be awarded depending on the economic viability of the oil field. We will continue to tread cautiously during this period and will only take on contracts that significantly add to shareholders’ value. Sustainability ‘Building trust’ has been a strong focus for Yinson which we have been progressively and intentionally investing in over the years. We believe that a foundation of trust will