Source document: https://docs-lawep.s3.us-east-2.amazonaws.com/1697730714286.pdf (Fiji)
Corporate Profile Corporate Highlights Financial Summary Corporate Governance Board of Directors 7 8 9 17 Executive Management Team Chairman’s Report Chief Executive Officer’s Report Financial Statements 69 10 Year Statistical Review TABLE OF CONTENTS CORPORATE PROFILE Our Organisation Our Business The Fiji Sugar Corporation Limited was incorporated in Fiji by an Act of Parliament in 1972 to take over the milling activities with effect from 1st April 1973.
It is successor to SPSM Limited and CSR Limited.

In 2006, the Fiji Sugar Corporation Act was repealed allowing to be governed solely under the Companies Act.

Our Shareholders The Government of Fiji is a major shareholder which owns 68% of shares while statutory bodies, local companies and individuals own the rest of the shares.

The Corporation owns and operates three sugar mills located at Lautoka, Ba and Labasa.
The mills are strategically located on the drier side of the two main islands where conditions are more suited to growing cane.

The Corporation is responsible for the manufacture and sale of raw sugar together with molasses as a by- product.

The Corporation owns and maintains a railway network which transports sugar to the mills.

The Corporation is one of the largest sector employers with a workforce of around 1,700 individuals during the peak crushing season.
The Sugar Industry is important to Fiji’s economy as it contributes about 1.1% of GDP, generates about 4.5% of total exports in 2019 based on the provisional data from the Reserve Bank of Fiji.

Unlike many other export-oriented businesses, most production inputs are domestic and have a high regional impact and cross-sectoral linkages.

CORPORATE HIGHLIGHTS Financial Results Operations • Corporation’s share of proceeds was $41.9 million compared to $38.8 million in the previous year.
• Consolidated trading loss was $19.8 million, compared to a loss of $23.1 million in the previous year.

• A total of 1.81 million tonnes of sugarcane was crushed from an area of 37,643 hectares compared to 1.70 million tonnes from 37,105 hectares in the previous year.

• Profit from operations was $40.1 million, compared to • Sugar production was 168,703 tonnes compared to a loss of $62.7 million in the previous year.

160,204 tonnes in the previous year.


• Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) was positive $60.7 million compared to negative $49.1 million in the previous year.

• Operating profit for the year was $21.9 million, compared to a loss of $80.1 million in the previous year.

• A total of $31.1 million was invested in Property Plant and Equipment, compared to $26.7 million in the previous year.
• Tonnes Cane to Tonnes Sugar (TCTS) ratio was 10.7 compared to 10.6 in the previous year.

• Cane Quality (POCS) was 10.3 compared to 10.6 in the previous season.

• The total sugar exported was 154,411 tonnes compared to 111,844 tonnes in the previous year.
FINANCIAL SUMMARY Sales and Profit ($’000) Total sales Trading profit/(loss) Unrealised exchange gain/(loss) Loss due to flooding Operating Profit/(loss) for the year Cash Flow ($’000) Operating activities Investing activities Financing activities Net increase/(decrease) in cash Financial Position ($’000) Working capital Current assets Total assets Non-current liabilities Current liabilities Shareholders’ equity 2020 2019 144,896 (19,824) (1,581) - 21,879 3,332 (20,642) 16,137 (1,173) (144,418) 51,690 223,906 327,762 196,108 (299,964) 132,776 (23,116) (3,492) (1,031) (80,070) (56,215) 4,707 49,534 (1,974) (165,426) 44,361 203,943 315,999 209,787 (321,843) Additional Information Ratio of current assets to current liabilities Ratio of debt to shareholders’ equity 0.26 (1.75) 0.21 (1.63 CORPORATE GOVERNANCE FSC views corporate governance in widest sense, almost like a trusteeship; it is a philosophy to be professed, a value to be imbibed and an ideology to be ingrained in our corporate culture.
Corporate governance goes much beyond mere compliance; it is not a simple matter of creating checks and balances.

It is in fact a continuous process of realizing the Corporation’s objectives with a view to make of every opportunity.

It involves leveraging its resources and aligning its activities to consumer need, shareholder benefit and employee growth.

Thereby the Corporation succeeds in delighting its stakeholders whilst minimizing risks.
The primary objective is to create and adhere to a corporate culture of conscientiousness and consciousness, transparency and openness.

The Corporation aims to develop capabilities and identify opportunities that serve goals of value creation, thereby creating an outstanding organization.

BOARD RESPONSIBILITIES supports a strong disclosure The Board regime acknowledging transparency as a key element of an effective corporate governance system.
This includes timely and accurate information to be disclosed on matters such as the Corporation’s financial and operating results, its objectives, major share ownership and voting rights, remuneration for directors and material foreseeable risk factors.

In addition to disclosure on commercial objectives, the Board encourages disclosure of policies relating to the environment and the communities in which the Corporation operates.
The Board meets regularly and receives full information in advance to help it discharge its duties.

A Director’s Package comprising pertinent background information and critical information on major risks, global industry trends and future direction of the Corporation is made available to all new directors.

The Board also supports the policies, principles and standards set out in the Companies Act, the accountancy profession and relevant statutory reporting requirements.
While these do not determine the detailed course of conduct by directors, they support the need for the highest standards of behavior and accountability.

The Board remains committed to upholding the highest standards of integrity and transparency in its governance of the Corporation.

The importance and the value of a balanced interplay between management, board and shareholders within the company remain a major principle governing the conduct of the Corporation.
The Corporation aims to be at the forefront of internationally recognized best governance practice.

The Corporation complies in all material respects with the generally accepted governance principles.

Corporate governance, as a dynamic interplay of forces, has its own sets of challenges and continues to evolve, especially in a small country like Fiji.

Central to the Corporation’s sound governance practices is the management of relationships and interest of its stakeholders.
The Corporation embraces these challenges through leadership, experience and skills, relationships and proper identification and control of business risk.

In doing so, the Board is required to determine sound management information and reporting system to the shareholders.
its strategy, people, teamwork COMPOSITION OF THE BOARD The Board aims to bring people of the right caliber with a wide and diverse range of business experience and expertise.

There are eight directors on the Board, appointed by the shareholders.

Board representation also includes key stakeholders.
ROLE OF SHAREHOLDERS The Board ensures that shareholders are fully informed of all major developments affecting the Corporation’s business.

Information is communicated to shareholders in the Annual Report, special reports and forum.

The Board encourages full participation of shareholders to ensure a high level of accountability in determination of the Corporation’s direction, strategies and goals.
MANAGEMENT RESPONSIBILITY The information presented in this report is prepared by the Corporation’s Management which maintains systems of internal accounting controls, policies and procedures to provide reasonable assurance as to the reliability of the financial records and the safeguarding of its assets.

Management regularly seeks independent assessment and reviews of its internal accounting controls, policies and procedures.
BOARD COMMITTEES The Board appoints board subcommittees to undertake specific functions as required under internationally accepted governance practices and on the needs of the Corporation.

Each Board Committee operates under a Charter.


The Finance & Audit Committee, which is a significant committee of the Board reviews the financial reporting process, the system of internal control and management of financial risks, the audit process and the company’s process for monitoring compliance with the laws and regulations.

The members of the Finance & Audit Committee are Mr. Pradeep Lal (Chairman), Mr. Savendra P Dayal and Mr. Tevita Kuruvakadua.
The Remuneration & Nomination Committee is tasked with assisting the Board discharge its responsibilities by providing an oversight of the Human Resource strategy of the Company including organization structure, remuneration policies, performance management, succession planning and development and monitoring all matters relating to terms and conditions of employment of staff and staff remuneration.

Its members are Mr. Savendra P Dayal (Chairman), Mr. Vishnu Mohan and Mr. Athil Narayan.
The Governance & Risk Committee has been set up to assist the Board discharge its responsibilities through oversight of the enterprise risk management, control and compliance framework established by the Board and management, formulation and review of the company’s policies and insurance, formulation and review of the governance policies, framework and compliance of the Company, development and monitoring of codes of conduct and any reported breaches of the code of conduct.
Its members are Mr. Athil Narayan (Chairman), Mr. Vishnu Mohan and Mr. Arvind Singh BOARD OF DIRECTORS Vishnu Mohan | Chairman Appointed as Chairman of the Board in July 2016.

Mr Mohan is a career Banker and the former Australia and New Zealand (ANZ) Banking Group Chief Executive Officer (CEO) for the Pacific and Fiji.

He is also the Chairman of Fiji’s Public Service Commission.

Pradeep Lal Appointed to the Board in November 2016.
Mr Lal is th Regional Chief Executive Officer for Vodafone and a Chartered Accountant by profession.

Tevita Kuruvakadua Appointed to the Board on 27 May 2015.

A career Accountant, Mr Kuruvakadua is the Chief Executive Officer for the iTaukei Land Trust Board.

Ratu Wiliame Katonivere Appointed to the Board on 27 May 2015.

Ratu Wiliame is a former Civil Servant.

He is now a businessman and a Chairman of Fiji Pine Limited and Director of Airports Fiji Limited.
Athil Narayan Appointed to the Board in December 2019.

Mr Narayan is the Executive GM Airports & Cargo Operations, Fiji Airways.

Savendra Dayal Appointed to the Board in December 2019.

Mr Dayal is the Managing Director of Healthcare Products International.

Arvind Singh Appointed to the Board on 27 May 2015.

Mr Singh is a businessman and sugar cane farmer.
EXECUTIVE MANAGEMENT TEAM Graham Clark Chief Executive Officer Manoj Ram Chief Financial Officer/Company Secretary Ashwin Gounder Human Capital Manager Sachin Deo Chief Information & Commercial Officer Mikaele Biukoto General Manager Sugar Operations CHAIRMAN’S REPORT There is no doubt that we are working through some of the most difficult times in the history of our sugarcane industry.
The impact of the COVID-19 pandemic and global economic slowdown are real issues, requiring extraordinary responses.

In difficult the need times, for is strong corporate governance vitally important and the Fiji Sugar Corporation is responding to these challenges.

In tough times, the need for the Corporation to maintain cohesion and stand together with our sugar cane growers cannot be understated.

That is why we at FSC place such a strong focus on teamwork and collaboration with our industry partners.
The world sugar market has been adversely impacted by COVID-19 and the global lockdown.

Due to a shortage of sugar in the world market, in early March 2020, the world sugar price experienced an increase to 15.2 c/lb.

However, the impact of COVID-19 on global commodity markets reversed this trend from the middle of March 2020 and the world sugar market retreated accordingly.

However, for FSC, sugar sales to the domestic market and Pacific Island Countries saw a positive growth in the year under review.
Environmental issues again negatively impacted us in the past year.

FSC was affected by the damage caused by Tropical Cyclone Sarai which led to a decline in the crop harvest to 1,806,572 tonnes, against a pre- crush estimate of 1,850,650 tonnes.

Furthermore, due to unfavourable changes to the weather patterns, sugar cane quality dropped critically, impacting the sugar make for the year.

As a consequence, there was a negative impact on the tonnes cane to tonnes sugar ratio for the year.
The Board approved targeted capital investments for major equipment upgrades and refurbishment at all three mills, which included works on juice stabilization systems, acquisition of new centrifugals, 1.6MW diesel generators, rotary vacuum filters, and the reinstallation of the 12MW TG set at Lautoka and 10MW TG set at Labasa respectively.

These upgrades assisted in improving and stabilizing operations at the mills in 2019.
Mechanization of harvesting efforts still remains a priority for our industry and it was pleasing to note that 28 new mechanical harvesters were introduced by cooperatives during the year.

Due to COVID-19 and travel restrictions, FSC and the cooperatives faced an unprecedented challenge as predominantly, harvester operators were hired from India.
Yet, through structured training initiatives, FSC managed to train Fijian nationals on and basic maintenance and as a result harvesting was generally unaffected.

Mechanization has brought a new dimension pertaining to the amount of extraneous matter being delivered to the mills for processing.

This now poses a processing challenge and the mill teams are working on solutions with the Sugar Research Institute of Fiji.
operations harvester impact, With the COVID-19 pandemic still the world, Fiji couldn’t ravaging escape although the containment measures effectively limited the spread of the virus within the nation.

FSC was directly impacted by this situation, being exposed to both the global and local effects of the pandemic.

In April 2020, FSC took steps to ensure business continuity and amid COVID-19.
Through the COVID Response Plan, the Corporation instituted a cut back in procurement to essential items only, tighter control on maintenance spending and a reduction in head count and wage costs together with benefits.

Services and contracted activities were scaled back as well.

survival To further reform FSC’s balance sheet, improve liquidity and ensure FSC’s ongoing viability, the Corporation resorted to disposing of unproductive land and properties through an open tender process.
This initiative has been positive with proceeds from sales totalling $25.93 million in the year under review.

At the last AGM, we spoke of our engagement with the Government of Fiji being the majority shareholder of FSC, to consider and implement the conversion of Government loans totalling $173.8 million to shares in FSC, and to propose the acquisition of minority shares.

Pleasingly, the conversion of Government debt to equity has been approved and the acquisition process is underway.
Our retail product line has been rebranded to “Sugars of Fiji” with an objective of finding new markets and business opportunities.

The launch of the new Sugars of Fiji retail packs was held on 21 October 2019, funded by the Market Development Facility (MDF).

The launch was officiated by the Hon.

Prime Minister and Minister for Sugar, Josaia Voreqe Bainimarama.
rebranding, Since Sugars of Fiji has been very well received in New Zealand in particular, and FSC has engaged an exclusive distributor in this important market.

the Board Sub- The work of Committees has progressed.

The Board Sub-Committees comprise, Audit, Nomination Finance & & Remuneration and Risk & Compliance.
I am pleased to report through collaboration with that the the Board Sub-Committees, Corporation substantially has strengthened governance and Board efficiency reflected in all facets of the business.

A clear example is the financial performance of the Corporation, with two key highlights being a positive EBITDA of $60.73 million and a net profit of $21.88 million for the year, compared to a net loss of $80.0 million last year.
the On behalf of the Board, I take this opportunity to thank our stakeholders for their patience and support while also appreciating immense dedication and commitment of our employees.

It is no secret that the challenges at FSC are multi-fold, but the Board and Management are increasingly determined to steer FSC onto a viable footing for the future, noting the importance of the Sugar Industry for Fiji’s continuing economic wellbeing.

In concluding, I want to thank the Hon.


Prime Minister and the Government of Fiji for their confidence in the Board of FSC and their ongoing financial and moral support to the sugar industry.

Vishnu Mohan Chairman CHIEF EXECUTIVE OFFICER’S REPORT Cane Production In the year ended May 31, 2020, FSC was affected negatively by the damage caused by Tropical Cyclone Sarai.
This led to consequences for our cane development resulting in a crop harvest of 1,806,572 tonnes against a pre-crush estimate of 1,850,650 tonnes.

However, this was an increase from 2018 harvest by 109,192 tonnes.

There was also an increase of 538 ha of area under cane from last season.

An area of 3055 ha was planted during the season, which ended in October. )
a h ( n o i t c u d o r P 2,000,000 1,800,000 1,600,000 1,400,000 1,200,000 1,000,000 800,000 600,000 400,000 200,000 0 ) a h ( g n i t n a P l 7000 6000 5000 4000 3000 2000 1000 0 2015 2016 2017 2018 2019 Production 1,844,559 1,387,248 1,631,392 1,697,369 1,806,572 Planting 2,379 4,180 5,802 5,078 3,055 Figure 1: 5 year actual planting against annual production There was a 6% improvement in crop in 2019, which amounted to 109,192 tonnes.
A total of 21,218 tonnes of Blended Fertilizer was delivered by South Pacific Fertilizers.

An improvement in the weedicide application was evident for the three major types, being Diuron, Glyphosate and Amine.

Growers are taking advantage of the Government subsidy on fertilizers and weedicides.

Through consolidated efforts to enhance crop yield in Plant and Ratoon cane, the government funded Cane Planting Grant was deployed in all areas to assist cane farmers replant fields and improve cane yields.
New cane farmers were also assisted through this cane planting grant.

Harvesting and Transportation to sugar solutions industry has many Fiji’s challenges in harvesting operations, and promote mechanisation are progressing to reduce cost and maximise sugar production.

Through a collaborative approach, daily mill cane supply has improved reducing cane stops due to low cane supply.

The introduction of harvesters has been the result of innovations in technology in the industry.
MECHANICAL HARVESTING Harvesting Progress by Mechanical Harvesters The growing interest in the procurement of harvesters by grower’s co-operatives has contributed positively to the mill throughputs.

This has cushioned the negative impact of reduction in manual cane cutters, and it is projected that the volume of billet cane will increase in the future.
Mechanical Harvesters greatly aided the growers and the Corporation by improving harvesting efficiencies, through the introduction of 28 new Mechanical Harvesters during the year.
Table 1: Summary of the Mechanically Harvested Cane for 2019 Season Mill Region Harvesters Available Green Tonnes Harvested Burnt Cane Harvested (t) Total Cane Harvested (t) Average Harvest/ Harvester % Burnt Cane Harvested Lautoka Rarawai Labasa Penang All Mill Area There was an increase in the number of 28 harvesters in operation from 2018 to 2019, which saw a significant increase in the volume of cane mechanically harvested.
Mechanical harvesting contributed 34.9% of total cane harvested during the season.

Labasa Mill recorded the highest at 39% with 242,786 mechanically harvested followed by Lautoka Mill at 32% with 202,871 tonnes.

Table 2: Mechanical Harvester Trend (2016-2019) Year No.

of Harvesters Tonnes Harvested % of Total Cane Harvested 2016 2017 2018 2019 20 44 59 87 123,519 307,013 496,202 629,762 8.9 18.9 29.2 34.9 There was an increase of 6% in mechanically harvested cane from 2018 to 2019.
At the current number of 87 harvesters, it is forecasted that mechanical harvesters have the potential to harvest 45% of the crop.

Table 3: Harvesting Summary Mill Region Total Cane Crushed Total Rail Tonnes Crushed Total Lorry Tonnes Crushed Cane Crushed Tonnes Tonnes % Av.
Trx Weight Tonnes % Lautoka Rarawai Labasa All Mill 657,161 65,766 10.0 487,483 54,615 11.2 661,928 92,768 14.0 1,806,572 213,149 11.8 2.8 2.4 2.4 2.5 591,395 90.0 432,868 88.7 569,160 85.9 1,593,423 88.2 Green Cane Burnt Cane Tonnes % Tonnes % 357,924 79,729 438,540 876,193 54.4 16.3 66.2 48.5 299,237 407,754 223,388 930,379 45.5 83.6 33.7 51.5 Av.
Lorry Weight 10.6 10.7 9.9 10.4 2 0 2 0 A n n u a l R e p o r t 10 F i j i S u g a r C o p o r a t i o n FACTORY OPERATIONS All the mills started off the season on schedule, as per the 2019 crushing season program.

It was fortunate that TC Harold which hit the country on April 8 and 9 did not cause major issues at the factories, except for some in maintenance days.
Labasa started on 12 June and Lautoka Mill commenced crush on the 13 June while Rarawai Mill commenced crushing on 9th July 2019. time lost Though Labasa officially began the 2019 crushing season on the 12 June a protest by the local Sugar Cane Lorry Association against the new weight limits for 6-wheeler trucks set by Land Transport Authority did not allow the mill to begin crushing normally and it was another week before cane supply normalised.
This problem also spilled over to Viti Levu and affected cane supply at Lautoka for the first two weeks.

The situation normalised after positive intervention by Land Transport Authority.

The Rarawai Mill startup was rescheduled to 9 July to ensure that all boiler related capital works were completed and commissioned by the contractors, before it was handed over to the factory.

three The factories performed reasonably well within the different operating perimeters.
Burnt cane and lower sugar content of raw material (POCS and Cane Purity) brought in for processing was a major issue.

With the influx of mechanical harvesters, it has brought a new dimension in terms of the amount of extraneous matter that is delivered with the sugar cane to be processed.

This now poses a processing challenge.

Solutions are being developed by a task team headed by Sugar Research Institute of Fiji.
Rarawai in the first six weeks of the 2019 season had issues with boiler ash withdrawal and its boiler feedwater pumps which was related to the major upgrade.

In view of the harvesting strength for the Rarawai a total of 160,000 tonnes of sugar cane was transferred to Lautoka Mill to be processed.
Major capital investments at the factories included, juice stabilisation three new centrifugals, systems, three 1.6MW diesel generators, three new rotary vacuum filters and the reinstallation of the 12MW TG set at Lautoka and the 10MW TG set at Labasa.

These all assisted in achieving stable operations at the mills in 2019. relating Benefits to processing efficiencies and cogeneration will be realised going forward as the plants are run to full potential in the 2020 crushing season.
The 2019 crushing season ended at Labasa on 17 November, Rarawai on 3 December and Lautoka on 15 December.
Table 4: 2019 Key Operating Data for the Mills r Parameters Tonnes Cane Crushed Tonnes Sugar Made Tonnes Molasses Molasses% Cane TCTS Inside Stops(hrs/wk) Outside Stops(hrs/wk) Cleaning & Maintenance(hrs/wk) Actual Crushing Time (hrs per wk) Crushing Rate(tcph) Season Length (calendar weeks) Lautoka 657,161 58,439 33,508 5.1 11.1 26.2 25.6 11.0 105.2 237 26.3 Rarawai 487,483 44,831 22,673 4.7 10.9 41.6 10.3 10.8 105.3 214 21.7 Labasa 661,928 65,433 27,553 4.2 10.1 10.9 41.1 2.9 113.1 232 25.2 Total/Av 1,806,572 168,703 83,734 4.6 10.7 26.2 25.7 8.2 107.9 683 2 0 2 0 A n n u a l R e p o r t 11 F i j i S u g a r C o p o r a t i o n CA N E PU R I TY CA N E PU R I TY CA N E PU R I TY Lautoka Rarawai Labasa Lautoka Lautoka Rarawai Rarawai Labasa Labasa 6 .
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Figure 2: 4 year POCS trend Figure 3: 4 year Cane purity trend 2 0 1 6 2 0 1 6 2 0 1 6 2 0 1 7 2 0 1 8 2 0 1 7 2 0 1 7 Yea r 2 0 1 8 2 0 1 8 2 0 1 9 2 0 1 9 2 0 1 9 Yea r Yea r Figure 4: 4 year sugar production and TCTS trend Labasa Rarawai Labasa Labasa 10.4 10.7 10.7 81.2 10.7 81.2 12.4 81.2 12.4 33.5 12.4 33.5 33.5 80.0 12.0 65.3 Labasa 10.7 81.2 12.4 33.5 2019 Season Cane Quality Table 5: 2019 Key Operating Data for the Mills 2019 Season Cane Quality 2019 Season Cane Quality Parameters Parameters Parameters POCS Parameters POCS POCS Cane Purity POCS Cane Purity Cane Purity Fibre in Cane Cane Purity Fibre in Cane Burnt Cane Received (%) Fibre in Cane Burnt Cane Received (%) Burnt Cane Received (%) Burnt Cane Received (%) Lautoka 9.9 9.9 9.9 79.4 9.9 79.4 79.4 11.4 79.4 11.4 11.4 57.2 11.4 57.2 57.2 57.2 Lautoka Lautoka Lautoka Fibre in Cane Rarawai Rarawai Rarawai 10.4 10.4 80.0 10.4 80.0 12.0 80.0 12.0 65.3 12.0 65.3 65.3 14 |2020 Annual Report 14 |2020 Annual Report 14 |2020 Annual Report 2 0 2 0 A n n u a l R e p o r t 12 F i j i S u g a r C o p o r a t i o n HUMAN CAPITAL MANAGEMENT Succession Management Training & Development – Grants Scoring Succession Planning & Management is being progressed within the Corporation to continually develop qualified pools of candidates for critical positions so that they are ready to step in when there are unplanned losses of key leaders.
During the year, the Corporation recruited five Sector Assistants in the Agriculture Division and promoted three Tradespeople to the role of Trainee Mechanical Engineer.

These individuals will undergo a structured training program managed by the Extension Services Manager & Chief Engineer respectively.
The Human Resources Team in collaboration with the Executive Management Team are working towards developing a program to enable the Corporation to produce future leaders who can demonstrate level of readiness in 1-2 years.

Online Recruitment Portal An online recruitment portal was successfully introduced during the year.

This system has reduced time-to-hire, improved database build up for future recruitment and became a branding opportunity for FSC.
Allowance Authorization Portal The approval process for overtime was also automated.

Due to the robust new process, overtime can only be performed after approvals from the Chief Financial Officer.

The alerts appear on emails to those who are part of the overtime workflow.

Restructure of the Field Division The Corporation is heavily reliant on cane development, and consequently, proper extension and advisory services.
Taking this into account, a restructure of the Field Division was undertaken which led to job roles being reviewed to enhance better service outreach to farmers.

Moreover, job titles now accurately reflect the scope of responsibilities of our employees.

The changes included: • • Field Officer – Head of Sector Operations.

Job title reviewed to better reflect current scope of work (previously Team Leader Sector).
Farm Advisor – to boost our extension services, Farm Advisors (previously Field Coordinators) will be focusing on pure extension services with no overlapping responsibilities to other field personnel.

All their daily activities will be aligned to the achievement of the sector’s crop target for the next season.

New Shift System A new shift system was designed and implemented to meet legislative requirements and improve productivity.
The operating rotation is a three-shift system, 48-hour week for six days a week with Sunday designated as a scheduled closure for the mills.

There were no job losses due to the reduction in the shift.

The Grant Scores provided by Fiji National University indicates the effectiveness of an organization’s Learning & Development Strategies.

FSC had been achieving scores in the region of 53-58% over the years.
However, with the introduction of new Training Processes, the percentage score increased to 72% in 2018, and a milestone score of 86% achieved in 2019.
Response to COVID-19 A policy on COVID-19 was designed by the Health & Safety Department in collaboration with Government Health Services and Human Resources which included: • Group sessions on COVID-19, its symptoms, how it spreads, precautionary measures that need to be taken; Ramped up security and surveillance at mills to ensure all employees complied with the Government directives; • • Census of the mill compounds to establish the individuals living in FSC Quarters and all visits to our property was restricted during the lockdown period; and • Changes to the mill resourcing to ensure all employees affected by the lockdown could still work effectively close to home.
The Corporation also worked closely with the Ministry of Health and Ministry of Labour to ensure all relevant protection equipment was made available and that quarantine measures were followed.

Human Resource Monitoring & Control Monthly monitoring of human resourcing levels was instituted in this financial year.

Discussions with mill management are held monthly to avert unnecessary overtime.

Similarly, a rationalization exercise was conducted to reduce the intake of casual/temporary workers.
Annual Leave & Long Service Utilization A leave utilization program was introduced towards the end of 2019, and employees were required to start using their annual leave timeously.

Almost 90% of annual leave was utilized by 31 May 2020.

Employment Relations A more effective employee disciplinary process has been instituted by the Corporation to ensure efficiency in the process and most importantly, allow for fairness and natural justice.
Furthermore, the Corporation recognizes the Union as an integral part of our business and through a consultative approach, the Human Resources Team has been able to implement significant improvement in this area during the year.

2 0 2 0 A n n u a l R e p o r t 13 F i j i S u g a r C o p o r a t i o n HEALTH & SAFETY Safety Culture Health & Wellbeing The Corporation’s safety culture was expanded in the year to understand and tolerate risk, control hazards and deal with accidents and near misses.
In its quest to achieve an improved safety culture, the Corporation implemented the following: • Reporting of risk, hazards, accidents, near misses and injuries; Restricting access to employees and contractors entering the mills without proper Personal Protective Equipment.
Lorry driver’s safety equipment to comply with safety standards during entry to site; Fit for purpose safety equipment is now bought in consultation with employees, supervisors and safety representatives so that user friendly and comfortable equipment is procured; and Permit protocol being followed for work at heights, hot works and confined space entries.

• • • • The COVID-19 period was well managed without any major incidents.
The Corporation focused primarily on mitigating the spread of COVID-19 with help from medical professionals and safety reps who worked closely with all teams to ensure that employee records and movements were tracked to limit any risk of infection.

Wellbeing awareness continued throughout the period as an established Health & Wellbeing calendar.

Posters and awareness materials were shared on emails and notice boards to all employees.
New uniforms were distributed to the employees at all the mills, including field teams, featuring improved light weight 100% cotton with good quality reflectors.

Injury Management The Corporation has established an improved safety culture in the past 24 months with the introduction of hazard risk identification and injury management programs.

There has been a 23% reduction in lost time injuries compared to the same period in 2019 and a 64% reduction compared to the last financial year.
This has demonstrated improving safety culture, presenting improvement in behavioral safety and safe decision making.
Table 6: Details of safety parameters for full year 2018/2019, full year 2019/2020 and YTD 2020 H&S KPI’s LTI’S (Employee) Medical Treatment Injuries First Aid Injuries Fatalities Contractor Injuries Hazards & Unsafe moves Reported Near Misses Reported w FY 2018/ 2019 FY 2019/ 2020 Jan-May 2020 Comments 65 0 14 0 2 247 13 23 0 11 0 0 150 4 8 0 2 0 0 65 1 1-Labasa,1-Rarawai and 6-Lautoka 2-Lautoka 26-Labasa 19-Rarawai & 20 Lautoka 1-Labasa 2 0 2 0 A n n u a l R e p o r t 14 F i j i S u g a r C o p o r a t i o n ENVIRONMENT MANAGEMENT Environment Management Quality and Food Safety Compliance Building sustainable environmental conditions is an ongoing task of the Corporation that requires the participation of management, employees and regulatory stakeholders, in a tripartite partnership to effectively eliminate hazards and/ or reduce risks impacting the environment.
The following projects were completed to mitigate environmental risks: • Flying soot emission reduction: A boiler upgrade has been completed with the installation of a Dust Collector System to control emissions at acceptable levels at the Lautoka Mill.

Elimination of wastage through spillage and handling: the maintenance team has rectified all major areas identified which resulted in spillage of sugar and molasses as part of their maintenance program and new processes.
• Risk Management forms the cornerstone of Risk Management the Corporation, incorporated in all areas of the business which includes Operations, Business Strategy, Finance, HR, IT, OHS/Safety, Quality and Environment.

The Corporation is committed to achieve its respective strategic business objectives by safeguarding its processes and operations with risk management systems.

requirements of Food Safety and Quality is recognized as one of the fundamental the Corporation.
The Corporation is committed to producing safe, high quality products that conform to all regulatory requirements and meet food safety standards and best practices.

• Customer complaints have significantly reduced over the past three years, particularly relating to the quality of sugar supplied to customers locally and in Pacific Island Countries.
With improved quality control mechanisms such as replacement of process screens and installation of additional magnets and implementation of good manufacturing practices, customer complaints were reduced by 80% in local and regional markets.

The “Sugars of Fiji” brand is well received by the New Zealand and regional markets and the Corporation is undertaking improvement programs including food standard certification to further improve the quality of sugar supplied.
• magnets and implementation of good manufacturing practices, customer complaints were reduced by 80% in local and regional markets.

 The “Sugars of Fiji” brand is well received by the New Zealand and regional markets and the Corporation is undertaking improvement programs including food standard certification to further improve the quality of sugar supplied.
MARKETING World Market Price Trend MARKETING World Market Price Trend The world sugar market has been significantly impacted by the negative effects of COVID-19 and the global lockdown.

Due to a shortage of sugar in the world market, in early March 2020, the world sugar price experienced an increase to 15.2 c/lb.

Thereafter, the impact of COVID-19 on global commodity markets reversed this trend and the world sugar market retreated accordingly.
The No.11 sugar pricing trend for the 2019/20 Financial Year has been as follows: The world sugar market has been significantly impacted by the negative effects of COVID-19 and the global lockdown.

Due to a shortage of sugar in the world market, in early March 2020, the world sugar price experienced an increase to 15.2 c/lb.

Thereafter, the impact of COVID-19 on global commodity markets reversed this trend and the world sugar market retreated accordingly.
The No.11 sugar pricing trend for the 2019/20 Financial Year has been as follows: 2 0 2 0 A n n u a l R e p o r t 15 F i j i S u g a r C o p o r a t i o n A total of 154,411 tonnes of bulk raw sugar was exported during the year.
The following table summarizes Figure 5: World market price trend Bulk Raw Sugar Export these exports: Destination United Kingdom Spain Netherlands USA Total Tonnage (MT) 80,500 34,000 31,500 8,411 154,411 Direct Consumption Raw Sugar Sales to the Domestic Market and Pacific Island Countries Sugar sales to the domestic market totaled 25,307 tonnes of which 9,906 tonnes was sold in 25kg bags while 15,401 tonnes was sold as retail packs.
A total of 6,696 tonnes was sold to the Pacific Island Countries and New Zealand markets which demonstrated a positive trend compared to the previous year, from which 6,302 tonnes was sold in 25kg while 394 tonnes into retail packs.

The major markets for Fiji sugar in the Pacific Island Countries are Samoa, Tonga and Kiribati.

The sale of Fiji sugar commenced last year in the New Zealand market after a successful re-branding of the ‘Sugar of Fiji’ product line.
18 |2020 Annual Report Bulk Raw Sugar Export A total of 154,411 tonnes of bulk raw sugar was exported during the year.

The following table summarizes these exports:Food Safety and Quality is recognized as one of the fundamental requirements of the Corporation.

The Corporation is committed to producing safe, high quality products that conform to all regulatory requirements and meet food safety standards and best practices.
Destination United Kingdom Spain Netherlands USA Total Tonnage (MT) 80,500 34,000 31,500 8,411 154,411 Direct Consumption Raw Sugar Sales to the Domestic Market and Pacific Island Countries Sugar sales to the domestic market totaled 25,307 tonnes of which 9,906 tonnes was sold in 25kg bags while 15,401 tonnes was sold as retail packs.
A total of 6,696 tonnes was sold to the Pacific Island Countries and New Zealand markets which demonstrated a positive trend compared to the previous year, from which 6,302 tonnes was sold in 25kg while 394 tonnes into retail packs.

The major markets for Fiji sugar in the Pacific Island Countries are Samoa, Tonga and Kiribati.

The sale of Fiji sugar commenced last year in the New Zealand market after a successful re-branding of the ‘Sugar of Fiji’ product line.
Molasses Exports Domestic Molasses Sales Domestic sales of molasses for the financial year totaled 3,381 MT.

The major buyers were Paradise Beverages and Rewa Dairy.

Sugar Packaging Plant The FSC Packaging Plant was able to pack 15,794 MT of sugar into retail packs of 1kg, 2kg & 4kg last financial year, with the majority of the retail packs sold in the domestic market.

Other markets for retail packed sugar are Samoa, Vanuatu and New Zealand.
The demand for 1kg and 2kg retail packs is high in the Pacific Island Countries while the demand for 4kg is high in the New Zealand market.

A Continuous Improvement Program is currently being implemented at the Packaging Plant to deliver high quality product to customers.
Re-Branding of Sugars of Fiji We are grateful to the Market Development Facility (MDF), an Australian Aid Program, for funding the rebranding of the “Sugars of Fiji” product line, with the objective of finding new markets and increasing revenue for FSC.

The launch of the new Sugars of Fiji retail packs was successfully held on 21 October 2019 at the Packaging Plant, officiated by the Hon.

Prime Minister and Minister for Sugar, Josaia Voreqe Bainimarama.
The new-look Sugars of Fiji brand has been very well accepted in the New Zealand target market, and we continue to explore further opportunities to drive our brand across global markets.
Graham Clark Chief Executive Officer 2 0 2 0 A n n u a l R e p o r t 16 F i j i S u g a r C o p o r a t i o n THE FIJI SUGAR CORPORATION LIMITED FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MAY 2020 TABLE OF CONTENT Directors’ report Directors’ declaration Auditor’s independence declaration to the Directors of The Fiji Sugar Corporation Limited Independent auditor’s report Statement of profit or loss and other comprehensive income Statement of financial position Statement of changes in equity Statement of cash flows Notes to the financial statements 18 22 23 24 27 28 29 30 31 2 0 2 0 A n n u a l R e p o r t 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 F i j i S u g a r C o p o r a t i o n 2 0 2 0
36 37 38 39 40 41 42 43 44 45 46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61 62 63 64
o r a t i o n 2 0 2 0 A n n u a l R e p o r t 64 65 66 67 68 F i j i S u g a r C o p o r a t i o n 10-YEAR STATISTICAL REVIEW Financial Statistics for year ended 31 May Turnover 2020 144.9 2019 132.8 2018 2017 2016 2015 2014 2013 2012 2011 182.1 144.9 199.8 197.3 224.0 199.0 203.6 141.5 Profit/(Loss) before taxation 21.9 (80.1) (24.6) (45.0) (53.4) (31.7) - - - - - - 6.9 - 6.3 - 1.8 (36.6) - - Income Tax (expense)/ benefit Profit/Loss after taxation & Extra-ordinary items Total Assets Net Assets Proceeds of Sugar & Molasses 21.9 (80.1) (24.6) (45.0) (53.4) (31.7) 6.9 6.3 1.8 (36.6) 223.9 203.9 204.1 199.6 254.2 266.2 279.3 254.6 196.1 148.7 (300.0) (321.8) (241.8) (217.1) (172.1) (117.4) (85.7) (92.6) (98.9) (100.7) 139.82 129.8 180.7 143.4 195.8 191.7 214.6 185.7 200.8 121.6 FSC's share of proceeds 41.9 38.8 54.2 43.0 58.7 56.0 62.5 55.7 60.2 36.5 Price per tonne cane 85.00 85.00 85.00 82.00 76.66 81.01 88.49 81.83 65.67 49.16 Production statistics Season 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 Cane Crushed 1,806 1,696 1,631 1,387 1,845 1,832 1,610 1,547 2,095 1,780 Sugar Produced Molasses Produced Tonnes Cane/Tonnes Sugar Molasses % Cane POCS % Cane Purity % Fibre in Cane % Average Crushing Rate for all mills (tcph) Actual Crushing Time as % of Available Time Field statistics Season Number of Growers 16,754 16,666 16,605 16,526 16,387 16,348 15,528 15,948 16,259 16,609 Number of Active
 Growers 11,638 11,412 11,871 11,676 12,405 12,681 12,633 12,848 12,791 13,251 Tonnes Cane per Hectare Average Tonnes Cane per Grower 48 143 46 142 43 137 38 119 47 148 48 144 42 127 37 120 49 164 40 134 Number of Cane Cutters 7,650 7,700 7,771 9,173 9,582 10,341 8,973 8,109 10,285 9,650 Output per Cutter (tonnes) Burnt Cane % 154 49 110 51 117 34 142 57 182 39 173 41 179 29 191 36 203 25 184 23 Sugar exports - destinations and quantities (metric tonnes) Season UK/EU USA KOREA GERMANY CHINA TOTAL 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 146,000 68,600 129,828 104,736 165,260 184,414 165,557 146,656 138,222 110,731 8,411 9,034 14,570 8,329 21,163 16,254 - - - - 480 33,730 - - - 200 220 766 - - - - - - - - - - - - - - - - - - - - - - 154,411 111,844 144,398 113,265 186,643 201,434 165,557 146,656 135,462 110,731 2 0 2 0 A n n u a l R e p o r t 69 F i j i S u g a r C o p o r a t i o n Notes 2 0 2 0 A n n u a l R e p o r t 70 71 72 F i j i S u g a r C o p o r a t i o n