Chemical Company of Malaysia Berhad Sustainability Report 2019

| OUR COMMITMENT TO SUSTAINABLE | ECONOMIC PRACTICES To contribute economy stability by providing opportunities for regional and global development. CCM is currently one of the largest manufacturers of chemicals and polymers in Malaysia. The Group is the market leader for industrial and specialty chemicals as well as serves as a one-stop centre for the provision of a wide range of polymer- coating solutions. Our continuous commitment to sustainability transcends corporate responsibility as we also enhance stakeholder value through making solid contributions to the local economy. ANNUAL ECONOMIC PERFORMANCE [201-1] We believe in adopting a long-term approach to economic sustainability and this is evident in our resilient performance. For the financial year ended 31 December 2019 or FY 2019, CCM recorded revenue of RM385.2 million, a marginal decline of 2.7% from revenue of RM395.9 million in FY 2018. As a sustainable and circular business, we capitalise and expand our annual income through our company performance. After deducting all of the economic value distributed for our operational costs, employee wages and benefits, payments to investors and government and investments to the community, we registered a profit after tax (PAT) of RM16.1 million for FY 2019, a 48% decline against PAT of RM30.7 million in FY 2018. We acknowledge the importance of creating and distributing economic value and wealth to our stakeholders. In FY 2018, as part of its efforts to meet growing market demand for chlor-alkali products, our Chemicals Division embarked on a capacity expansion exercise that involved the reactivation of its Pasir Gudang Works 1 (PGW1) chlor-alkali manufacturing facility; the relocation and expansion of a new Calcium Nitrate (CN) plant in Shah Alam; and the expansion of the production capacity at its Coagulant plant by adding a new polyaluminium chloride production line. All these plants that underwent capacity expansion have already begun generating revenue which bodes well for the Group’s performance over the short to mid-term. Following a debottlenecking exercise conducted by our Polymers Division at its Bangi manufacturing plant, the plant’s workflow has improved and its capacity has increased by an additional 10% from 18,000 MT/pa to 19,800 MT/pa. A new production capacity is currently being added at the Bangi site which will double the Kleeners capacity from 9,000 MT/pa to 18,000 MT/pa. The production process will also leverage on automation to enhance cost efficiencies and product quality. This will add value to the Polymers business and give it a more competitive edge. The advanced new ultra-modern laboratory for polymers R&D will enable the Polymers Division to intensify new product development as well as testing and developmental activities for industries beyond the gloves sector. The investment in cutting edge lab equipment too will help CCM fast-track R&D efforts. All these developments augur well for the Polymers business even as demand growth for polymers is on the rise. (Note: For further details of our financial and operational performance, please refer to CCM’s Annual Report 2019) 33 SUSTAINABILITY REPORT 2019