Felda needs clear new direction to maintain strong financial performance — AG’s Report

KUALA LUMPUR: Felda must establish a clear new direction to ensure it can continue to operate with strong financial performance without relying heavily on financial assistance and support from the Federal Government.

This was recommended by the Auditor-General’s Report on the financial statements of federal agencies in Parliament today to ensure Felda’s sustainability and viability.

The agency was also advised to improve its monitoring of subsidiary companies’ operations and financial performance, which would enable Felda to provide favourable returns.

According to the report, the financial statements for 2022 indicate that Felda incurred a net loss of RM1.005 billion, and its cash and cash equivalents amounted to RM0.808 billion.

“Felda has significant commitments amounting to RM1.561 billion, including RM0.753 billion for replanting liabilities and RM0.808 billion for unspent Federal Government grants,” according to the report.

Based on the same financial statements, Felda’s outstanding loans from external institutions amounted to RM8.659 billion, aimed at restructuring its loans from 2018 to 2022, while at the Felda Group level, total loans from the government and financial institutions reached RM15.117 billion.

In its feedback, Felda highlighted the establishment of a special task force, working in collaboration with the Prime Minister’s Department, to develop a recovery plan aimed at ensuring its continued presence in the industry.

Felda added that the government has agreed to inject RM1 billion over seven years to settle the sukuk debts and government guarantee revolving credit (GGRC) loans.