INTRODUCTION

Sime Darby is a worldwide business with a substantial presence in Malaysia's plantation, energy,
automotive and infrastructure, real estate and hospitality sectors. Sime Darby is a company that is
traded on the main board of Bursa Malaysia Securities Berhad. Sime Darby Plantation headquarters
located at Petaling Jaya and was founded in 2004. Sime Darby Plantation provides a diverse portfolio
of high-quality vegetable oil-based ingredients for use in food, non-food, and consumer products.
Investigate the limitless applications of our goods in your daily life. Their upstream activities include
241 farms and 70 palm oil mills in Malaysia, Indonesia, Papua New Guinea, and the Solomon Islands,
where their estates deliver fresh fruit bunches (FFB) to be processed into crude palm oil (CPO). The
RSPO Principles & Criteria ensure that Sime Darby Plantation follow environmental best practises,
biodiversity conservation, and social protection in all aspects of their business. Sime Darby
Plantation R&D capabilities as a fully integrated palm oil company cover all research areas across the
value chain. They are committed to creating, implementing, and sharing relevant information,
research findings, and technologies to increase our plantation yields, milling processes, and
customise our downstream goods through strategic and operational R&D. Sime Darby Plantation is
dedicated to creating and supporting sustainable goods and practises in the palm oil sector as the
world's largest producer of certified sustainable palm oil.

Sime Darby Plantation logo

Financial Highlight

Sime Darby Plantation Berhad (SD Plantation) reported a net profit of RM1.2 billion for the Financial
Year Ended 31 December 2020 (FY2020), compared to a net loss of RM200 million in FY2019. The
Upstream and Downstream segments of the Group both had stronger year-over-year (YoY) results.
The Group's Upstream sector benefited from higher crude palm oil (CPO) and palm kernel (PK)
prices, while the Group's Downstream unit, Sime Darby Oils (SDO), saw increased profits and lower
production costs as a result of its ongoing business transformation initiative. The Group has
announced a final dividend of 5.42 sen per share, which, when combined with the interim dividend
of 2.57 sen per share, yields a single tier dividend of 7.99 sen per share for FY2020. A special interim
dividend of 1.45 sen per share was also announced by the Group, which was paid on November 22,
2020. In 2020, total dividends issued were 9.44 sen per share, down from 1.00 sen in 2019.

EMPLOYEES BENEFITS

Employees are granted "benefits" because they boost job satisfaction and organisational
commitment. Employee benefits are more than just a useful tool for businesses all around the
world; they also play a vital part in social and economic infrastructure. Employee benefits
programmes are not only a significant investment for most businesses, but also a significant
opportunity to gain a competitive advantage.

Short-term employee benefits, post-employment benefits, other long-term benefits, benefits for the
employment termination contract, and compensation in the form of equity participations are all
identified and classified by International Accounting Standard IAS 19.

i. The following are short-term employee benefits by Sime Darby Plantation:

 Wages
 Salaries
 paid annual leave and sick leave
 bonuses and
 non-monetary benefits are accrued in the financial period in which the services are rendered
by employees.

ii. Defined contribution pension plans

 A defined contribution pension plan is one in which the Group contributes a certain amount
to a distinct organisation. If the fund does not have sufficient assets to pay all workers the
benefits pertaining to employee service in the current and past periods, the Group has no
legal or constructive responsibilities to pay further contributions. In compliance with local
conditions and norms in the countries where it operates, the Group offers a variety of
defined contribution pension plans. Contributions to defined contribution pension plans
made by the Group are charged to profit or loss in the financial period to which they pertain.

iii. Defined benefit pension plans

 A pension plan that is not a defined contribution pension plan is known as a defined benefit
pension plan. In most defined benefit pension plans, the amount of pension benefit an
employee would get upon retirement is determined by one or more criteria, such as age,
years of service, and salary. The Group has a number of defined benefit pension schemes,
some of which are partially financed by payments from the applicable group of firms in
different countries. The amount of benefits that qualified workers have earned in exchange
for their services in the current and past financial periods is estimated in the Group's defined
benefit pension plans, which are decided based on a periodic actuarial valuation by external
experts.
 The defined benefit pension plan liabilities are equal to the current value of the defined
benefit obligations at the end of the reporting period, adjusted for actuarial gains and losses
and past service expenses, and less the fair value of the plan assets. Independent actuaries
compute the defined benefit obligations using the Projected Unit Credit Method, taking into
account projected future cash withdrawals. The current defined benefit plan service cost
shows the growth in the defined benefit obligation due to employee service in the current
year. Except when it is included in the cost of an asset, it is recognised in profit or loss as
employee benefit expenditure.
 Market adjustments and changes in actuarial assumptions result in actuarial profits or
losses, which are included in other comprehensive income. The discount rate is applied to
the net balance of the defined benefit obligation and the fair value of plan assets to
compute the net interest expense. This item is accounted for in the statement of
comprehensive income as employee benefit expense. Changes in the current value of the
defined benefit obligation as a consequence of plan changes or curtailments are
immediately recognised as past service expenses in profit or loss.

iv. Termination benefit

 When an employee's employment is terminated in return for these perks, termination
benefits are paid. When the Group is manifestly committed to either terminating the
employment of present workers pursuant to a comprehensive formal plan with no chance of
withdrawal or providing termination benefits as a consequence of a proposal to encourage
voluntary redundancy, termination benefits are recognised.

v. Other long-term benefit

  Other long-term employee benefits, such as deferred compensation due 12 months or
longer after the service period, are computed using the same approach as other post-
employment benefits, depending on the Group's and Company's policies.

Other advantages provided by Sime Darby Plantation include free housing, rice, and cooking oil,
as well as subsidised utilities. Sime Darby Plantation's Malaysian estate and mill operations will
benefit from the enhanced compensation and other incentives announced, which will benefit
about 37,000 employees and personnel. General labourers, estate and mill office staff, and
auxiliary police personnel are among them. The tables below provide an example disclosure
format for Sime Darby Plantation.

The Extract of Financial Statements

Group company
Note 2020 2019 2020 2019
RM’000 RM’000 RM’000 RM’000
(d) Employee cost include:
Salaries, wages and bonus 2,021,410 1,899,838 549,837 490,720
Defined contribution plans 100,920 104,630 82,975 80,624
Retirement benefits 38 35,401 41,805 6,620 7,622
Termination benefits 202,295 251,788 118,482 133,122
Other employee benefits 202,295 2,301,133 769,860 715,160

CORPORATE SOCIAL RESPONSIBILITY

Community Rights

Sime Darby Plantation have been educating their employees on how to best protect their health in
these situations since the epidemic began in 2020. To restrict the spread of the virus, they
implemented preventive methods in their facilities, such as personal protective equipment (PPE) for
employees, temperature checks, and ensuring social distance is observed within Sime Darby’s
operations. Sime Darby built up separate health centres for workers on their estates and kept on-site
food stores stocked with necessary goods like rice. Wherever they operate, Sime Darby will continue
to adjust their activities in compliance with national legislation and give health advice.
Sime Darby also took strides ahead in 2020 to protect their employees' rights by improving their
grievance reporting systems and launching a third-party reporting hotline for all of Malaysian
employees, which is available in the languages they speak. Sime Darby noticed an improvement in
confidence in the service's usage, and they are doing outreach programmes to raise knowledge and
comprehension of how to utilise it. Migrant employees make up a significant portion of their
workforce, and Sime Darby recognise that they have the right to unfettered access to their papers,
including passports. Sime Darby have provided each worker with their own safe locker on the estate
where they work in order to enable free and fast access to their papers.

Besides, Sime Darby Plantation continue to advocate for gender equality as part of their
commitment to Human Rights. The Female Manager Development Program is in in its second year,
with the goal of increasing possibilities for women to lead and manage estates and mills within the
firm. Children's rights must be protected as part of the obligations. They want to make sure that
children are secure and protected in their facilities, and they are trying to eliminate child labour
across the value chain. Sime Darby have built up crèches and schools for estate workers' children so
that they may be certain that their children are being cared for and receiving an education
throughout the working day.

Sime Darby continues to help their communities improve their access to education by offering
scholarships through the Foundation and funding different educational programmes in the
communities where they operate. Sime Darby's activities include financial support for building
learning centres as well as the organisation of short-term educational CSR programmes.

In collaboration with the Ministry of Finance (MOF), Ministry of Education (MOE), and Yayasan
Hasanah, Sime Darby Plantation Berhad, Sime Darby Property Berhad, and Sime Darby Berhad
launched CERDIK, a Corporate Social Responsibility pilot initiative aimed at providing digital learning
access to students from low-income families. Yayasan Sime Darby (YSD) has set aside RM16 million
for the programme, which will benefit 7,500 B40 children from 59 primary and secondary schools in
24 districts across Malaysia, and will be supported by YSD Huluran Kasih volunteers from Sime Darby
businesses. During the financial year, the following transactions were made:
 The Extract of Financial Statements

Group company
2020 2019 2020 2019
RM’000 RM’000 RM’000 RM’000
Transaction with associate
(i) Corporate social 26,000 20,000 8,134 2,800
responsibility
donation paid
- Yayasan Sime Darby

Sime Darby completely respect the communities' traditional rights in the regions where they work.
In their planting methods, Sime Darby also take into account the United Nations Declaration on the
Rights of Indigenous Peoples.

Prior to development, Sime Darby’s teams must engage with community leaders and the
communities affected by their initiatives. In a forum session, Sime Darby present their plan of action
for the specific area and invite the community to share their thoughts with them. Without the
express permission of the community or its elected officials, Sime Darby shall not proceed with
development in that area.

They assist and occasionally take on the responsibility of developing or repairing infrastructure and
facilities such as roads, community halls, and health centres for the majority of their activities in
distant and rural places. Sime Darby Plantation also establishes facilities that assist in the
improvement or provision of fundamental requirements like as clean water, sanitation, and
education. They also hope to improve the livelihoods of local populations by providing job
opportunities, economic growth, and alternative livelihood training through their activities.
Children’s Right

Sime Darby are dedicated to upholding children's rights in our operations, taking steps to eradicate
child labour, guaranteeing the care and safety of children in our facilities, developing child-friendly
goods and services, and supporting advocacy activities.

Sime Darby took part in a UNICEF research in 2016 to better understand the impact of palm oil on
children in order to achieve our goal of eliminating the worst kinds of child labour by 2025. The
research looked at how palm oil plantations affect children and how they can be better respected.
One of the study's main findings was that palm oil has the potential to offer the infrastructure and
services needed for children's development, such as childcare and schools. In fact, there are still

gaps in knowledge about proper nutrition, breastfeeding alternatives, and the value of education.
Some of the primary underlying factors contributing to these effect areas were also found in this
qualitative study.

Sime Darby Plantation don't hire anyone under the age of 18 for any job, let alone one that is
dangerous. Everyone in their supply chain, including smallholders and contractors, is reminded of
the significance of keeping minors out of their fields. Rec They recognise that the factors that
motivate children to work on farms with their families are frequently socioeconomic in nature, such
as household income and a lack of education.
Common Size Analysis for Income Statement of Sime Darby Plantation Berhad

Sime Darby Plantation Berhad

Statement of Profit/(Loss) and Other Comprehensive
For the Financial Year Ended 31 December 2020
2020 2019
RM '000 RM '000
Revenue 13,081,128 100.00% 12,062,266 100.00%
Operating expenses -11,573,157 -88.47% -11,651,019 -96.59%
Gross profit 1,507,971 11.53% 411,247 3.41%

Other operating income 591,585 4.52% 202,361 1.68%

Other gains and losses -14,175 -0.11% -209,376 -1.74%
Operating profit/(loss) 2,085,381 15.94% 404,232 3.35%

Share of results of joint ventures -908 -0.01% 3,911 0.03%

Share of results of associates 4,901 0.04% -2,257 -0.02%
Profit/(loss) beforre interest and tax 2,089,374 15.97% 405,886 3.36%

Finance income 17,294 0.13% 12,975 0.11%

Finance costs -116,418 -0.89% -167,545 -1.39%
profit/(loss) before tax 1,990,250 15.21% 251,316 2.08%
Tax (expense)/credit -465,526 -3.56% 23,569 0.20%

Profit/(loss) for the financial year 1,524,724 11.66% 274,885 2.28%

Common Size Analysis for Statement of Financial Position of Sime Darby Plantation
Sime Darby Plantation Berhad
Statement of Financial Position
For the Financial Year as at 31 December 2020
2020 2019
RM '000 RM '000
NON-CURRENT ASSETS
Property, plant and equiptment 17,283,404 61.03% 17,314,025 88.37%
Investment properties 7,467 0.03% 7,609 0.04%
Right-of-use assets 2,063,441 7.29% 2,145,540 10.95%
Joint venture 34,647 0.12% 34,152 0.17%
Associates 42,635 0.15% 39,755 0.20%
Intangible assets 2,788,792 9.85% 2,840,508 14.50%
Investment at fair value through other comprehensive income 27,068 0.10% 30,469 0.16%
Deffered tax assets 620,867 2.19% 640,094 3.27%
Tax recoverable 264,643 0.93% 333,674 1.70%
Trade ond other receivables 185,985 0.66% 155,741 0.79%

CURRENT ASSETS
Inventories 1,569,398 5.54% 1,498,398 7.65%
Biological assets 224,408 0.79% 188,764 0.96%
Trade and other receivables 2,246,482 7.93% 1,933,597 9.87%
Tax recoverable 214,513 0.76% 312,616 1.60%
Amount due from related parties 3,246 0.01% 2,158 0.01%
Planned Assets 43,886 0.15%
Derivatives 67,590 0.24% 76,737 0.39%
Bank balances, deposits and cash 309,029 1.09% 431,347 2.20%
4,678,552 16.52% 4,443,617 22.68%
Non-current assets held for sale 323,150 1.14% 522,538 2.67%
TOTAL ASSETS 28,320,651 100.00% 19,592,512 100.00%

EQUITY
Share capital 1,506,119 5.32% 1,506,119 5.28%
Reserves 12,147,381 42.89% 11,754,854 41.23%
Attribute to equity holders of theh company 13,653,500 48.21% 13,260,973 46.52%
Perpetual Sukuk 2,231,398 7.88% 2,231,398 7.83%
Non-controlling interests 384,850 1.36% 368,351 1.29%
TOTAL EQUITY 16,269,748 57.45% 15,860,722 55.64%

NON-CURRENT LIABILITIES
Retirement benefits 277,380 0.98% 259,736 0.91%
Deffered income 67 0.00% 207 0.00%
Deffered tax liabilities 2,622,961 9.26% 2,598,247 9.11%
Borrowings 4,396,917 15.53% 5,255,384 18.43%
Lease liabilities 163,801 0.58% 162,112 0.57%
Trade and other payables 80,734 0.29% 77,401 0.27%
7,541,860 26.63% 8,353,087 29.30%

CURRENT LIABILITIES
Trade and other payables 1,555,025 5.49% 1,360,612 4.77%
Contract liabilities 28,087 0.10% 13,071 0.05%
Amount due to related parties 17,835 0.06% 6,989 0.02%
Retirement benefits 17,871 0.06% 15,189 0.05%
Lease liabilities 25,951 0.71% 25,163 0.09%
Tax payable 201,537 0.71% 104,698 0.37%
Derivatives 359,751 1.27% 242,913 0.85%
Borrowings 2,285,286 8.07% 2,489,543 8.73%
4,491,344 15.86% 4,258,178 14.94%
Liabilities directly associated with non-current assets held for sale 17,699 0.06% 35,735 0.13%
TOTAL LIABILITIES 12,050,903 42.55% 12,647,000 44.36%
TOTAL EQUITY AND LIABILITIES 28,320,651 100.00% 28,507,722 100.00%
Vertical Analysis Income Statement

TH SIME DARBY PLANTATION

BERHAD

Year 2019 2020 2019 2020

Revenue 100% 100%

Other income 1.68% 4.52%

Pretax income 2.08% 15.21%

Net profit 2.28% 11.66%

Vertical Analysis Balance Sheet

TH SIME DARBY PLANTATION

BERHAD

Year 2019 2020 2019 2020

Current assets 22.68% 16.52

PPE 88.37% 61.03%

Non-current liabilities 29.30%% 26.63%

Current liabilities 14.94% 15.86

Total equity 55.64% 57.45%

Comparison of Disclosure
TH Plantation Berhad
 The company's management
is required to pay employees'
wages, yearly bonuses,
compensated annual and sick
leave on an undiscounted
basis. TH Plantations Berhad
additionally offers up to 60
days of parental or maternity
leave to its workers.
 Additionally, TH Plantations
Berhad contributes to legal
pension plans. One of the
Group's subsidiaries has
chosen to contribute to the
Staff Retirement Benefits
Scheme.
Not disclose in Annual Report
Not disclose in Annual Report
 The amount of benefit-in-
kind (BIK) expected to be
available for the Directors for
the year is Nil, compared to
RM36,000 the previous year.
 TH Plantations Berhad
developed the Caring
Assistance Programme (CAP)
in an effort to mitigate the
devastating effects of Covid-
19 on the Group's employees,
local residents, vendors, and
businesses in the vicinity of
Sime Darby Plantation Berhad
Short-term benefits  Wages, salaries, paid annual
and sick leave, bonuses were
provided for the employees of
Sime Darby Plantations
Berhad.
Pension plans  The Group also offers a
defined contribution pension
plan. One or more criteria,
such as age, years of service,
and pay, determine the
amount of pension benefits an
employee will get upon
retirement.
Termination benefits  Termination benefits are
made available to the Group's
workers. This means that
termination benefits are
provided when an employee's
job is ended in exchange for
these advantages.
Long-term benefits  Other long-term employee
benefits, such as deferred pay
due 12 months or more after
the service period, are
calculated in the same way as
other post-employment
benefits, based on the rules of
the Group and Company.
Benefit-in-kind  Sime Darby Plantation also
include free housing, rice, and
cooking oil, as well as
subsidised utilities
CSR to employees  Sime Darby Plantation Berhad
implemented preventive
methods in their facilities,
such as personal protective
equipment (PPE) for
employees, temperature
checks, and conducting the
supervision of social
 the Group's plantations and
industrial grounds.
 Sarawak's Native Customary
Rights (NCR) Land
Development, often known
as a land management
programme, was launched by
TH Plantation. This
programme is seen as the
Group's approach to valuing
the rights of indigenous
peoples and working together
to manage the land.
 TH Plantations Berhad has
participated in the Promoting
Intelligence, Nurturing Talent,
and Advocating
Responsibilities programme
in carrying out its charitable
responsibility since 2009.
 Another instance of the
Group's Corporate Social
Responsibility may be
identified when the
organisation launches the
Vendor Development
Initiative (VDI).
 friendly goods and services,
 In its Group Sustainability
Policy, the company
emphasises No Deforestation,
No Peat, and No Exploitation
(NDPE).
 the Group tries not to cause
damage towards riparian
reserves which is stated in its
Sustainability Statement
 preventing the rivers from
being polluted by the
drainage and the release of
water as the aftermath of the
operations conducted
distancing within Sime Darby’s
operations
 Improving their grievance
reporting systems and
launching a third-party
reporting hotline for all of
Malaysian employees, which
is available in the languages
they speak.
CSR to community  Sime Darby Plantation
continue to advocate for
gender equality as part of
their commitment to Human
Rights
 Sime Darby continues to help
their communities improve
their access to education by
offering scholarships through
the Foundation and funding
different educational
programmes in the
communities where they
operate.
 Sime Darby also take into
account the United Nations
Declaration on the Rights of
Indigenous People.
 Sime Darby is dedicated to
upholding children's rights in
its operations, taking steps to
eradicate child labour,
guaranteeing the care and
safety of children in its
facilities, developing child-
and supporting advocacy
activities.
CSR to economic & Not disclosed in Annual Report
environment
 TH Plantations Berhad
practices the policy of zero
burning during its operations