KUALA LUMPUR: The Federal Land Development Authority (Felda) has today addressed its higher net loss of over RM1.0 billion in 2022, stressing that it does not result from misuse, corrupt practices or weaknesses in management governance.
According to Felda, the main factors contributing to the loss include the impact of derecognition and remeasurement of settlers' loans, amounting to RM339.01 million, aimed at alleviating the burden on the settlers.
Furthermore, the authority attributed the higher loss to corporate guarantees for loans used to acquire PT Eagle High Plantations through FIC Properties Sdn Bhd, totalling RM379.85 million.
It also highlighted the write-offs of loans to subsidiaries such as FIC Group and Dataran Aras Sdn Bhd, amounting to RM192.66 million, as contributing to the increased net loss.
"Felda recorded an operating profit of RM19.560 million in 2022. The Felda Group (consolidated account) recorded a profit before tax of RM449 million in 2022.
"This loss does not refer to misuse, corrupt practices, and weaknesses in management governance.
"Felda will continue to enhance operational efficiency and transparent governance, and optimize productivity efficiency to ensure Felda remains relevant in the future," Felda told the New Straitis Times.
The 2022 Auditor General's Report revealed that Felda had incurred a higher net loss of RM1.005 billion in 2022 from RM545 million in 2021.
The report also said the outstanding loans from external institutions for Felda amounted to RM8.66 billion, a drop from RM8.81 billion in 2021.
It said Felda.in 2022 received a reduced grant of RM214 million compared to RM342 million in 2021.
The reduction in grants received by Felda affects its operational sustainability as Felda is highly dependent on financial assistance from the federal government," the report stated.
The Auditor General's report recommends that Felda chart a course to operate independently, ensuring strong financial performance without continual reliance on external assistance.