Section 6 UEM Edgenta Berhad ENHANCING VALUE THROUGH SUSTAINABILITY 122 OVERALL PERFORMANCE ADAPTATION TO ECONOMIC CHALLENGES UEM Edgenta navigates several overarching economic challenges affecting its global operations, with implications for its value creation and economic impact: • Elevated Costs: The group contends with rising costs across the board, from manpower expenses linked to wages and benefits to operational costs associated with materials, technology, and infrastructure. • Market Competition: The intensity of competition in the markets UEM Edgenta operates within exerts downward pressure on pricing, compelling the company to find innovative ways to deliver value without compromising on profitability. • Labour Market Dynamics: Issues such as workforce shortages, heightened turnover, and increased absenteeism place additional strain on the company’s ability to deliver services efficiently and cost-effectively. Responses: • Revenue Protection Measures: Actively defend our revenue streams against liquidated damages, clawbacks, and billing discrepancies to optimise earnings and mitigate financial pressures. • Cost Optimisation Initiatives: Adopted stringent cost reduction, control, and avoidance strategies, demonstrating a dedicated approach to curbing unnecessary expenditures. • Contractual Terms: Proactive engagement with clients to manage the effects of regulatory changes and macroeconomic shifts such as inflationary cost pressures to safeguard contract sums. • Sector-Specific Growth Focus: Amidst economic challenges, we capitalised on growth opportunities within the existing sectors, as well as adjacent sectors (example: hospitality and manufacturing sectors, aiming to expand its revenue base through new and existing contracts). SUSTAINABLE ECONOMIC GROWTH A. Direct Economic Value Generated Revenue and Other Income (RM million) 2022 : 2,528.7 2021 : 2,299.5 2020 : 2,035.9 2023 2,888.4 2020 2021 2022
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