Chairman’s Statement Email This Print This

Dear Valued Shareholders,
On behalf of the Board of Directors of Greenyield Berhad and its Subsidiaries (“Greenyield or the “Group”), it gives me pleasure to present to you the Annual Report and Audited Financial Statements for the financial year ended 31 July 2016.

Economic Review
The  commodity  market  remained  generally  weak  during  the  financial  year  ended 31 July 2016. This was reflected in the reduced demand for the Group's agriculture chemicals and fertilizers. The large amount of rubber withheld from the global rubber market further subdued the economic activity despite the slight increase in rubber price.  For  the  financial  year  ended  31  July  2016,  the  overall  revenue  was  lower than the previous financial year. Nevertheless the Group managed to remain fairly profitable due to innovative and dedicated staff putting in extra hours of diligent work to resolve and mitigate negative factors.
 

Financial Performance
For the financial year ended 31 July 2016, the Group recorded a lower revenue of RM37.30 million as  against RM 44.58 million for the previous financial year. The profit before tax was RM 3.63 million as compared to RM 6.31 million in the financial year 2015. The revenue obtained from the plantation segment showed a decrease from the previous year, while the non-plantation segment showed an increase from the previous financial year.

The revenue from the plantation business segment was RM 16.49 million as against RM 28.39 million in the financial year 2015. In the case of non-plantation segment, the revenue was RM 20.81 million as compared to RM 16.19 million achieved in the previous year.
 

Research And Development
The  Group  has  invested  an  expenditure  of  RM  0.46  million  in  Research  and Development activities, which is equivalent to 1.23% of the revenue recorded for the financial year ended 31 July 2016.

A major thrust of the R&D activities for year under review was the development and evaluation of Biofertilizers for plantation crops and horticultural plants. This is in keeping with the Group’s efforts to broaden the current product range while taking advantage of the growing demand for Biofertilizers. It is expected going forward that Biofertilizers will be a key product for the Plantation segment. Modified organic potting  mixture  which  can  compete  in  the  market  in  terms  of  pricing  has  been launched. R&D efforts have also resulted in the development of an improved Latex Coagulant which should find greater market acceptance. The R&D activities are ongoing to develop an enhanced Ethephon Plus formulation which will enable the group to retain its significant share of the latex stimulant market in Malaysia and overseas. To enable wider acceptance of two products by the agricultural sector, namely Green Plus, a foliar nutrient formulation, and Frumone a product to induce flowering & fruiting, R&D activities have been intensified to test these products on a wider range of crops namely coffee, cocoa, tea and pepper. In addition preliminary studies  have  been  initiated  to  develop  new  products  such  as  rat  baits  which indicatively have an appreciable market in Malaysia.

For  the  non-plantation  business  segment,  the  Group  focuses  on  improving  the formulation  of  existing  composite  material  as  well  as  formulating  new  composite material. The Artstone plant pots are now available in selected Aeon outlets.
 

Business Outlooks And Prospects
The Group has started to generate revenue from its plantation, derived from tapping of 200 hectares in Melati Aman. Currently, the Group has on its own and via a joint venture, 2,800 hectares of rubber in the state of Kelantan, and almost 2,400 hectares have been planted.

For  the  non-plantation  business  segment,  the  Group  has  seen  steady  growth  in revenue for plant pots since 2009. The Group will intensify its efforts to market its products in the local and international markets.

The  Board  anticipates  improvement  on  the  Group’s  performance  in  the forthcoming financial year, and foresees growth in revenue from both plantation and the non-plantation sectors.
 

Dividend
The Board of Directors aims to maintain the Company’s policy of stable dividend payout to shareholders. The Board has proposed to declare a single-tier final dividend of 0.60 sen per ordinary share for the financial year end 31 July 2016, subject  to  the  approval  of  the  shareholders  at  the  forthcoming  Fourteenth Annual General Meeting.
 

Corporate Development
The Company has not implemented any new corporate proposals during the financial year ended 31 July 2016. The Board will explore any related business operations and credible investment opportunities to improve the Group’s performance as well as enhance shareholder value.
 

Acknowledgement
I  wish  to  acknowledge  the  employees  whose  dedication  and  perseverance  have contributed to sustainable growth of the Group, and ensured its commitment to be a trusted and reliable partner to the Companies we served globally. On behalf of the Board, I would like to express our thanks and appreciation to our shareholders, customers, business associates, financiers, suppliers and regulatory authorities for their continued support and understanding extended to us during the year.

Dr Zainol Bin Md Eusof
Independent Chairman