74 YINSON HOLDINGS BERHAD | INTEGRATED ANNUAL REPORT 2023 CORPORATE FUNDING RISK Definition and impact of the risk on Yinson Corporate funding risk refers to the risk that the Group may not be able to source sufficient funds (e.g. through equity, rights issues, debt funding) to cover working capital and capital expenditure. Availability of funding is important to ensure sustainable growth for Yinson whereby the funds received from internally generated or externally sourced financing are utilised to cover working capital costs, equity injection or on-lending as intercompany loans to subsidiaries and debt servicing, as well as refinancing of debt and quasi-equity facilities. Funding constraints, which might be caused by a liquidity squeeze, limited confidence by financing facilities in the outlook of the oil & gas industry and deterioration in Yinson’s credit rating may lead to defaults on debt obligations, failure to meet repayment schedules, suspended growth and disrupted operations. How we manage or mitigate the risk • Focused corporate finance teams led by the respective business unit CFOs tasked with the funding activities for their respective business units. • Raising loan financing or any other funding mechanisms to fund existing and future projects through engagement with various financial institutions. • Issuance of RM360 million in nominal value of Islamic notes under the Perpetual Sukuk Wakalah Programme. • Securing USD720 million syndicated loan facility for the FPSO Maria Quitéria project. Moving forward (opportunities) • Opportunity to source for funding through green loans and sustainability-linked funds. • Yinson’s non-FPSO business units, such as renewables, provide an attractive secondary market capital investment, supporting capital recycling and therefore helping to develop the potential for new sources of capital. CYBERSECURITY RISK Definition and impact of the risk on Yinson Cybersecurity risk is the probability of the Group’s internal system/applications being exposed to various cyber attacks, including hacking, ransomware and phishing. As organisations worldwide have shifted to embrace digital transformation and leverage on advanced technological solutions in optimising work efficiencies and driving business growth, the exposure to cybersecurity risk has increased, which could result in loss of confidentiality, integrity or availability of data and adversely impact Yinson. Any breach in internal IT system security may result in leakages and loss of confidential or critical data which will further lead to financial and reputational damage as well as potential legal consequences. How we manage or mitigate the risk • The cybersecurity team is in the process of executing the Group Cybersecurity Roadmap based on the feedback garnered from the Board and businesses. The roadmap consists of multiple initiatives which will strengthen the cybersecurity system within the Group. • Continue to enhance cybersecurity awareness training for the Group. • Strengthening policy governance, such as the Information Security Policy & Procedure. • Conducting annual strategic touchpoint discussions with internal stakeholders and business unit leaders. Moving forward (opportunities) • Strengthening data governance and architecture. • Continued investment in IT infrastructure and internal HR and equipping them with the latest IT know-how. • Aligning the Group Cybersecurity Roadmap to further improve our security posture to the desired maturity levels. RISKS AND OPPORTUNITIES
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