MISC BERHAD 44 INTEGRATED ANNUAL REPORT 2023 45 www.miscgroup.com VALUE WE CREATE SECTION 5 Value Creation Business Model INPUTS • 104 LNGCs and petroleum & product tankers • 13 Floating assets • Marine and heavy engineering facilities • Maritime training facility Physical Capital P Financial Capital F • Total Assets of RM65.1 billion • Shareholders’ equity of RM39.3 billion • Cash and cash equivalents of RM7.7 billion • Debt of RM17.5 billion • 55 years of experience in the maritime industry • Explored collaborations on clean energy solutions and decarbonisation initiatives Intellectual Capital I • Diverse and inclusive workforce of 10,435 employees from 46 nationalities • RM54.9 million invested in capacity building for employees Human Capital H • RM29.6 million invested in ALAM cadet sponsorships • Maritime education scholarships to promote youth development • 247 employees volunteered in the Heart of The Ocean (HOTO) programme since 2021 Social & Relationship Capital SR • 16,634,887 megawatt-hours of energy consumption • Reliance on natural resources such as fuel, water and land Natural Capital N OUR KEY CAPITALS... ...ENABLE VALUE-ADDING... Value Creation Business Model STAKEHOLDERS SDGs OUTPUTS/OUTCOMES ...BUSINESS ACTIVITIES THAT CREATE... ...VALUE FOR OUR STAKEHOLDERS • Revenue of RM14.3 billion • Profit after tax of RM2.0 billion • CFO** of RM6.5 billion • Dividend payout of 36 sen per share • Credit rating of S&P Global Ratings at BBB+, Moody’s Ratings at Baa2 F Shareholders/Investors/ Financial Services Providers • Transported 6% of global LNG • Transported approximately 134 million tonnes of crude and petroleum products globally • Above 99% for vessel availability • Above 99% for vessel utilisation • Above 90% for offshore floaters’ uptime P Customers • 26.5 total average training hours per shore employee • LTIF at 0.09 • TRCF at 0.31 H Employees • 2 AiPs secured • 13 accolades received • 8 owned dual-fuel vessels • 1 FSU award I Customers Employees • Sponsored 829 ALAM cadets • 13 sponsored students under the maritime education scholarships • Engaged 13 families within the community in the HOTO programme SR Customers Communities Government/Regulators • Recorded 4.15 million tCO2e of Scope 1 & 2 GHG emissions • 24% reduction in our fleet average CO2e intensity compared to 2008 • Recycled, reused or recovered 99.9% of hazardous waste • Zero major oil spill N Communities Government/Regulators BUSINESS OPERATIONS MARITIME EDUCATION & TRAINING Rebuild and rejuvenate the academy to achieve University College status by 2025. OFFSHORE BUSINESS Focus on project delivery and execution for MERO 3 Project while continuing to pursue opportunities in targeted markets. GAS ASSETS & SOLUTIONS Focus on selective projects, expand new gas asset classes and enhance the fleet with modern energy-efficient LNGCs. MARINE & HEAVY ENGINEERING Focus on project delivery improvement, high value marine projects, diversified business portfolio and establish footprint internationally. MARINE SERVICES Focus on operational and service excellence, expand market share and diversification of revenue profile. PETROLEUM PRODUCT & SHIPPING Focus on strengthening the secured income stream while pursuing low-carbon business solutions through collaboration and/or partnership. We continued to generate value-driven outcomes by focusing on project delivery and execution, while strengthening our ESG commitments. We continued to build our capabilities and strengthen our core operations while focusing on purposeful entry into clean energy business and decarbonising our operations. Selective Investments and Project Delivery Excellence Strategic Business Review Pacing Growth to Ensure Sustainability MISC 2023 Strategy Business Model Transformation Organisational Culture & Behaviour Strategic Client Positioning MISC 2030 Aspiration Please refer to page 70 Renewable Energy Value Chain The building block to manage climate change challenges with the maritime sector playing a key role Waste-To-Value Chain Critical in tackling resource scarcity and emissions as well as repurposing maritime assets MISC 2050 VISION 50% GHG Emissions Reduction in Shipping Operations 25% CFO* from Clean Energy Solutions 50% CFO* Improvements RISKS AND MITIGATION STRATEGIES Please refer to page 66 MATERIAL MATTERS Please refer to page 62 Please refer to page 54 OPERATING ENVIRONMENT Vision To consistently provide better energy-related maritime solutions and services Mission To be consistently better, we strive to: • Exceed the expectations of our customers • Promote individual and team excellence of our employees • Create a positive difference to the lives of communities • Care for the environment and operate responsibly • Drive sustainable value for our shareholders * Cash flows from operating activities ** This refers to the adjusted CFO which excludes the payment for costs relating to turnkey activities for MERO 3 Project and the one-off FSU prepayments in 2023. Short-Term Short to Medium-Term Medium to Long-Term to be delivered through
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