2019 UEM Edgenta Annual Report

38 39 UEM Edgenta Berhad MESSAGE FROM OUR LEADERSHIP STRATEGIC FOCUS OPERATIONAL REVIEW SUSTAINABILITY EFFORTS CORPORATE GOVERNANCE INTRODUCTION FINANCIAL REVIEW ADDITIONAL INFORMATION UEM EDGENTA AT A GLANCE MD/CEO’s Statement MD/CEO’s Statement linen, to infrastructure-based solutions such as RAMS and drone inspections. For our PFS business, we have productised our solutions into three different service levels such as Smart Connect, Smart Connect Plus and Smart Connect Advance. Being a service provider to essential and core industries, it is imperative that our Company is in pursuit of ‘Best- In-Class Operations’. Under this banner, we will uphold our focus in Operational Excellence where the Innovation Garage is to tackle high-impact problem statements, while Continuous Improvement / LEAN principles are built into process improvement programmes. Supporting this, our Company will embark on a new contracting strategy moving from a conventional, input-based model towards an outcome-driven one, with efficiency- based elements. To standardise and institutionalise knowledge and improve service delivery, we have launched the Edgenta Academy which will focus not only on training our own employees but that of our service partners too. Under a new initiative to elevate the capabilities of our service partners and contractors, the Edgenta Academy will evaluate and rate these companies according to predetermined technical and commercial criteria and based on the assigned rating, develop a programme to train and upgrade their knowledge. This serves not only to ensure our partners have the necessary capabilities but also the opportunity to upskill and modernise themselves. We hope to develop competent and capable service partners who can take on more complex work as well as invest in mechanisation and technology. This is part of our programme to develop the industry and the players within the value chain. We strive to achieve top line growth by defending our existing stable revenue base. Annual Report 2019 DEVELOPMENT OF THE EDGENTA WAY The Edgenta Way was developed to show how we work in the organisation. The four key differentiators of the Edgenta Way are being Technology-Enabled, HSSE Focused, Quality Assured and having Certified Standards, which will be our promise to our clients on how we approach our work and deliver our services. We have endeavoured to inculcate the Edgenta Way throughout all facets of our business. OUR COMMITMENT TO HSSE Health, Safety, Security and Environment (“HSSE”) is a critical and priority area within the organisation and with our partners. In FY2019, we continued this improvement journey in driving safety culture into every aspect of our business and operations, reviewing systems and processes, supported by a team of dedicated HSSE personnel. We further enhanced our approach by collaborating with key stakeholders such as the Malaysian Institute of Road Safety (MIROS) and innovation-focused teams, implementing several safety-driven automation and mechanisation initiatives this year. My management team and I continue to learn from our safety incidents which will only serve to strengthen our resolve and make our work zones safer for our frontline workers. OUR COMMITMENT TO TECHNOLOGY AND INNOVATION Technology and Innovation is part of the Edgenta Way and is being embedded as part of our culture and thinking. We have led the adoption and use of technology across all our businesses to enhance our product offerings, applied mechanisation, automation and digitalisation widely within our services while embracing data analytics, cloud computing, machine learning and artificial intelligence, as well as the use of mobile devices and tablets to deliver on our services. Building on this, we have partnered with technology providers and startups to produce commercially viable solutions, with digital healthcare and online e-commerce platforms. Innovation has become fundamental for us with disruptions rife around us. Thus, in order to promote innovation within the organisation, a permanent ‘garage’ has been set-up as an agile decision-making space, which enables ideas to be tested, solutions to be prototyped, and pushed out for scale-up. The garage functions as a funnel and repository for ideas and eventually becomes an enabler by employing a dare-to-fail approach, spurring our employees to take risks and encouraging innovative ideas to flourish towards the modernisation of our services. Therein lies, our approach towards embedding innovation as a culture within our organisation. DELIVERING ON OUR STRATEGIC OBJECTIVES In FY2019, we reviewed and refined our strategies into four which are Disrupting Our Delivery Model, Deepening Our Competencies, Broadening Income Streams and Developing Total Solutions Capabilities. The Company will continue to remain guided by these growth strategies, supported by our six strategic focus areas of Operational Excellence; Organisational Excellence; HSSE; Client Solutions; Technology and Innovation; and Stakeholder Management and Communications that has carried us through the years. Via these strategic initiatives to guide our efforts, we strive to achieve top-line growth by defending our existing stable revenue base from our long-term contracts and track record of high renewal rates, pursue organic growth by building a healthy pipeline of projects, exploring opportunities for expansion regionally and promoting cross-selling internally between business divisions. I invite you to read further details on our performance against our strategic objectives in the Group Strategy, Operational Review and Sustainability Statement on pages 47 - 48, 55 - 63 and 64 - 83 of this Report. LEADERSHIP BENCH During the course of the year, we strengthened our leadership bench with the appointments of En. Razman Ismail as Chief People Officer, who has joined us in October 2019, and Dr. Nik Fawaz Nik Abdul Aziz as Head of Healthcare Support (Concession) and Managing Director of Edgenta Mediserve Sdn Bhd (“EMSB”) to succeed En. Ahmad Zamri Said. We also welcomed Mr. Kenny Lim as the Head of PFS division, as well as the recent appointment of En. Shariman Yusuf Mohamed Zain as Head of Infrastructure Services and Managing Director of Edgenta PROPEL Berhad. MOVING FORWARD 2020 AND BEYOND We are bracing for a difficult period in 2020 which reached unprecedented proportions. The start of 2020 has been tumultuous, whereby tough macroeconomic conditions, as well as the swift spread of the COVID-19 virus and its unfolding ramifications across the globe, may yet bring the world to its knees during the year. In the face of this unprecedented event and the yet to be ascertained impact on the global economy, financial markets and people across the globe in general, it is inevitable to foresee tough economic conditions with the main challenge of how to kick-start the economy going forward and to restore industries and workforce productivity. UEM Edgenta takes its position as a responsible corporate citizen seriously and will work with our clients, regulators, policymakers, service partners and contractors to contribute our resources and ideas to support the industry and its players. In April 2020, given our focus on our expertise in biomedical equipment and healthcare technology, UEM Edgenta donated 30 units of mobile ventilators, 30 units of patient monitoring systems, as well as enabled a cloud-based healthcare information system to the MoH Malaysia for pandemic management, in support of the Malaysian Government’s effort in combating the growing COVID-19 pandemic. Over the years our businesses have proven to be resilient and agile to adjust to changes in the market. As a company in stable and defensive markets with attractive yield, I am confident we will weather this storm and come out strong. Given our healthy balance sheet and sound financial position, the timing will be right to look at possible opportunities to build up on new areas especially technology-related fields. Our continued efforts in technology and innovation, which have already proven worthy of commercialisation, place us in good stead to preserve our sustainability over the long-term. Please refer to Our Technology Solutions on pages 26 - 27 of this Report for further details. ACKNOWLEDGEMENTS It was with great sorrow we saw the passing of Dr. Saman @ Saimy Ismail, an Independent Non- Executive Director of the Company. Dr Saimy was also the Chairman of EMSB, in which he served the Company from 9 May 2013. We are grateful for his contribution and time with us and extend our condolences to his wife Pn. Rosnah Mohd Yusof, children and family. I would also like to thank key members of the management team who have moved on or retired, namely En. Shahazwan Harris, Chief Strategy & Transformation Officer; En. Ahmad Zamri Said, Head of Healthcare Support (Concession) whose career spanned 22 years with our Company; Mr. Chin Chi Haw, who spent his career serving Opus in various capacities and later led Edgenta PROPEL Berhad as its Executive Director and Mr. Alastair McCracken, our previous Head of Property & Facility Solutions who resigned in June 2019. I would like to take this opportunity to thank Datuk Seri Amir Hamzah Azizan, for his invaluable contribution and guidance as our Chairman from 29 August 2016 until his retirement on 15 May 2019 and wish him the very best in his role as President/Chief Executive Officer of Tenaga Nasional Berhad. We welcomed Tan Sri Dr. Azmil Khalid as our new Chairman on 24 May 2019, who brings with him a wealth of experience in this industry as an accomplished entrepreneur. We also welcomed Dato’ Mohd Izani Ghani as a new Board member effective 22 October 2019 and am sure he will bring much value to the Company. It has been my privilege and honour to have served as the first Managing Director/Chief Executive Officer of UEM Edgenta, after the merger of the legacy companies of Faber Group Berhad, Projek Penyelenggaraan Lebuhraya Berhad or PROPEL, and Opus Group Berhad. While many mergers and acquisitions do not reach its intended objectives, I feel that UEM Edgenta’s success was built around a good post-acquisition programme which aligned the entire workforce, from the Board of Directors, to senior management and all employees. In short, we were determined to create a successful organisation in this process and shaped the DNA of UEM Edgenta. My sincere gratitude and appreciation to the entire Board of Directors who have guided me through the years and allowed me to carry out my duties with support and encouragement. I would like to thank our major shareholders, UEM Group Berhad and Khazanah Nasional Berhad, for their stewardship. I would also like to express my appreciation to all our other shareholders for their continued trust in us. Additionally, I would like to extend my gratitude to our local and regional clients, our many supply chain partners, shareholders and the Government for their support and contributions to our ecosystem. My final word of thanks is reserved for each and every employee of UEM Edgenta, management and staff who have made this Company special, as without their belief, support and dedication, we would not have scaled the heights which we have reached today. Throughout my tenure, I have met many talented and extraordinary colleagues, I am humbled by your continuous dedication to our vision and the important service we deliver. I am certain you will rise above any challenge and make use of the opportunities in realising the Edgenta of the Future, as well as ensure the Company’s continued leadership in Asset Management and Infrastructure Solutions. DATO’ AZMIR MERICAN Managing Director/Chief Executive Officer