Yinson Annual Report 2021

89 ANNUAL REPORT 2021 Project Lease classification EPCIC recognition* Timing of EPCIC recognition* Owned by the Group FPSO Adoon Operating lease No FPSO JAK Operating lease No FPSO Helang Finance lease Yes Point in time (Q4 FYE 2020) FPSO Abigail-Joseph Finance lease Yes Point in time (Q3 FYE 2021) FPSO Anna Nery Finance lease Yes Over time Owned through joint venture arrangements FPSO PTSC Lam Son Operating lease No FSO PTSC Bien Dong 01 Operating lease No * Refer to the Group’s accounting policy for EPCIC revenue recognition in Note 2.7(i) to the Financial Statements. To enhance understanding of the Group’s financial performance, we disclose the contribution of EPCIC activities to the Group. Since the prior financial year, the Group’s awarded lease contracts were systematically classified under International Financial Reporting Standards (“IFRS”) as finance leases for accounting purposes. EPCIC recognition applies to projects which are of finance lease in nature, where revenue is recognised either over time based on the progress of construction or at a point in time when the asset’s rights of use are handed over to a lease client. This accounting treatment accelerates recognition of lease revenues and profits into the construction phase of the asset, whereas the asset generates the cash only after construction and commissioning activities have been completed, as that is the point in time the Group is entitled to start receiving the lease payments. In the case of an operating lease, lease revenues and profits are recognised during the lease period, effectively more closely tracking cash receipts. The lease classification and timing of EPCIC revenue recognition (where relevant) for the Group’s FPSOs and FSOs are set out below. FINANCIAL CAPITAL In FYE 2021, the Group experienced significant revenue growth with FPSO Helang completing its first full year of lease charter (“Non-EPCIC operation activities”), FPSO Abigail-Joseph giving rise to the recognition of a one-off outright sales upon achieving first oil in October 2020 and FPSO Anna Nery progressively completing its engineering and construction works (“EPCIC operation activities”). Collectively, these contributed to a reported revenue of RM4,849 million in FYE 2021 – 92% higher than in FYE 2020. The revenue contributions from the Group’s joint venture arrangements in Vietnam and Ghana are presented separately as adjusted revenue, and accounted for in accordance with the Group’s equity ownership. REVENUE (EPCIC) FPSO Abigail-Joseph and FPSO Anna Nery are the two EPCIC projects undertaken by the Group in FYE 2021. FPSO Abigail-Joseph was successfully completed and commenced its lease charter on 28 October 2020 with a one-off non-recurring revenue contribution of RM1,095 million upon handover of the rights of use to the charterer. Meanwhile, the ongoing FPSO Anna Nery project contains an EPCIC component where such revenue is recognised over time, based on the progress of construction until Q1 2023. REVENUE (NON-EPCIC) The Non-EPCIC component represents the Group’s FPSO/ FSO operating activities. The Group has five operating FPSOs and one operating FSO on charter lease as at FYE 2021. FYE 2021 witnessed fresh revenue contribution from FPSO Abigail-Joseph since 28 October 2020 and full year’s revenue contribution from FPSO Helang, propelling non-EPCIC revenue beyond the RM1 billion mark to RM1,408 million.