Chairman's Statement
Extracted from Annual Report 2025
To Our Esteemed Shareholders,
For nearly four decades, FM Global Logistics Holdings Berhad ("FM" or "the Group") has grown from a Malaysian-based freight forwarder into a global player with offices in the ASEAN Region, China, India, Australia and the United States of America ("the USA"). Our strategic expansion has undoubtedly been shaped by the complexities and realities of global trade, where cyclical geopolitical and economic disruptions continually test operational resilience and heighten the demand for efficiency in moving cargo across borders.
While the Group delivered a commendable topline growth in Financial Year 2025 ("FY2025"), we navigated a more complex cost environment. Our continued expansion into multiple markets introduced higher localised cost pressures, from labour and rental to regulatory and logistics expenses, reflecting the realities of operating across diverse geographies. In tandem, our strategic investments in fleet renewal and infrastructure modernisation, though essential for long-term competitiveness, contributed to increased capital and operational expenditure.
Despite these headwinds, FM's full-year results surpassed the previous year, underscoring our resilience and ability to absorb cost pressures through scale, pricing discipline and operational efficiency. Nonetheless, the disproportionate rise in cost of revenue relative to topline growth signals margin compression, reinforcing the importance of prudent cost management as we scale.
We continued to provide dependable freight forwarding services (sea, land and air), and 3PL, Warehousing & Distribution services while carefully managing overheads and safeguarding service quality. The unprecedented revenue surge during the pandemic has since normalised, leading to steadier yet more competitive conditions. This underscores the continued importance of scale, infrastructure and customer-focused service delivery.
Expanding our logistics network remains a central priority, with investments in new warehousing and transport facilities progressing across multiple sites. Initiation of these projects during FY2025 will carry through into the next reporting period, providing much-needed capacity relief and positioning us for sustainable growth.
Alongside infrastructure development, we embarked on a fleet modernisation programme, systematically replacing older vehicles with newer, more energyefficient models, including electric trucks. The upgrading to electrical material-handling equipment ("MHE") has enhanced operational reliability by reducing downtime and lowering long-term maintenance needs. More importantly, it reduces direct emissions previously generated by fuel-powered equipment within our warehouses, improving air quality and safety for our workforce.
Although electricity is now the primary energy source, a portion of this demand is supported by our solar panel installations, mitigating additional grid reliance. Over time, the transition to electrical MHE contributes to a gradual lowering of our carbon footprint while positioning our operations for greater energy efficiency and sustainability.
Collectively, these efforts will enhance efficiency today while laying the groundwork for longer-term sustainability. Concurrently, we remain committed to improving the profitability of existing operations through prudent cost management and disciplined execution.
Behind this progress is a dedicated team empowered to manage customer relationships and deliver solutions that meet the complexities of global supply chains. As FM continues to strengthen its operations and expand its strategic footprint, the focus remains on building capacity, strengthening governance and sustaining longer-term financial, operational and ESGrelated performance.
FM's resilient business model and sound financial footing provide the flexibility to navigate shifting market conditions. Beyond optimising routes and strengthening regional partnerships, we are mindful of climate-related risks that are redefining the logistics sector. By integrating these considerations into our operations and investment priorities, we are bracing ourselves for the long haul in a competitive environment, mitigating the challenges head-on while creating tangible value for our customers, employees, investors and partners.
ADAPTING TO SHIFTS IN TRADE
The global trade environment has shifted markedly from the highs of 2024 into a period of greater volatility. Rising protectionism, shifting tariff regimes and the weakening of multilateral trade frameworks such as the World Trade Organization ("WTO") agreements and regional trade pacts, are driving higher costs and unpredictability across supply chains.
For FM, this translates into greater complexity in route planning across both sea and air freight, where shifting tariffs, sanctions, airspace restrictions and port congestion require agile adjustments in carrier selection, transshipment hubs and documentation processes. Developing markets in particular are facing heightened challenges as policy instability disrupts trade flows and introduces additional operational uncertainty.
These challenges are not distant. They directly affect the cost of moving cargo, the efficiency of routes and the resilience of our customers' supply chains. We have responded by tightening route optimisation, strengthening regional partnerships and advancing our investment in warehousing and fleet renewal. In addition, we are actively exploring opportunities in new international markets, supported by targeted marketing initiatives and strategic engagement to expand our global footprint. While the external environment has become less predictable, we remain anchored by a durable and agile operating model and a clear strategy to support customers navigating these shifts.
MALAYSIA'S TRADE LANDSCAPE: IMPLICATIONS FOR LOGISTICS
Malaysia's trade performance in 2025 has remained steady despite mounting headwinds in the global economy. For the period January to August 2025, total trade reached RM1.98 trilion, up 3.8% year-on-year ("YoY"), reflecting increasing domestic demand and Malaysia's sustained integration with global supply chains.
China remains Malaysia's largest trading partner, anchoring a significant share of both exports and imports. At the same time, the USA, the ASEAN region and the European Union ("EU") continue to rank among Malaysia's top trade partners, reflecting the importance of diversified linkages across advanced and regional markets.
Yet, these gains are tempered by the volatility of global trade. Tariff measures have begun to alter shipment flows, extend lead times and raise compliance costs for exporters. For logistics providers such as FM, these developments are not abstract risks but practical realities.
MALAYSIA TOTAL TRADE
MALAYSIA'S TRADE PERFORMANCE JANUARY-AUGUST 2025
The logistics sector's response has been to accelerate diversification, with more emphasis on intra-ASEAN flows and other markets. At the same time, digitalisation, route optimisation and bilateral logistics partnerships are becoming central to ensuring efficiency and resilience.
These developments signal sustained demand drivers in international logistics, especially as Malaysia's trade flows expand in both scale and complexity. This environment highlights the importance of prudent investment, disciplined execution and strengthening customer relationships, while Malaysia's diversified export base and ongoing investment in trade infrastructure provide a measure of resilience. At the same time, the crux of how developed nations influence global markets and the resulting impact on Malaysia presents both challenges and opportunities to sharpen our competitiveness across the region.
FINANCIAL PERFORMANCE
POSITIVE RESULTS FOR ALL KEY FINANCIAL METRICS
During FY2025, steady growth was recorded across key financial metrics, anchored by a strong operational foundation. Revenue, profitability and shipments handled all improved, reflecting FM's adaptability in a challenging landscape.
Group revenue rose 16.6% YoY to RM952.8 million (FY2024: RM817.5 million), marking the strongest annual revenue since FY2022. Sustained demand across our logistics network supported the increase.
International Freight remained the key growth driver, with revenue rising by 22.8% to RM710.3 million (FY2024: RM578.2 million), supported by a 4.9% increase in throughput, primarily from Sea and Land Freight. Air Freight recorded an 8.4% growth in cargo handled, reflecting sustained demand across major trade lanes.
Domestic Logistics revenue remained largely stable, increasing slightly to RM242.5 million from RM239.3 million, a modest 1.3% increase YoY. Within this segment, 3PL, Warehousing & Distribution registered softer demand due to shifting storage trends, dipping 10.1%. Supporting Services posted strong growth, with revenue increasing 15.4% YoY to RM124.0 million from RM107.5 million, driven by higher demand for value-added solutions.
Profit Before Tax ("PBT") rose 2.4% to RM47.8 million (FY2024: RM46.7 million), with margins maintained despite cost pressures and stricter trade compliance. All segments stayed profitable except 3PL, Warehousing & Distribution, while Singapore operations were weighed down by lower transshipment activity. Profit After Tax and Minority Interests ("PATAMI") rose slightly to RM31.1 million from RM30.9 million in FY2024, translating into earnings per share of 5.57 sen.
For FY2025, I am pleased to state that the Group declared a total dividend of 4.5 sen per share or RM25.1 million, including a third interim single-tier dividend of 2.0 sen. At 80.8% of PATAMI, this represents the highest payout ratio in FM's history, reflecting a strong cash position and deliberate balance between rewarding shareholders and reinvesting for sustainable growth.
DIVIDEND PAYOUT
GOVERNANCE IN OPERATIONAL RESILIENCE
During FY2025, we took definitive steps to strengthen governance practices with a clear focus on reinforcing internal controls and mitigating supply chain risks inherent to crossborder logistics. Operating in multiple jurisdictions with differing regulatory regimes requires a governance framework that is both rigorous and adaptable.
FM maintained compliance with ISO 9001:2015, ISO 14001:2015, and ISO 45001:2018, upholding standards in quality management, environmental responsibility and workplace safety. Group-wide training on Anti-Bribery and Anti-Corruption ("ABAC") and Whistleblowing procedures was expanded to raise awareness, provide practical guidance and align behaviour with regulatory and ethical expectations. Embedding these protocols across our supply chain helps safeguard service reliability and mitigate exposure to unethical practices or operational disruptions.
By raising awareness and infusing compliance protocols into partner and supply chain engagements, FM is countering exposure to fraud, unethical practices and operational disruptions that can compromise service reliability.
Governance is an ongoing journey of continuous improvement. By incorporating strong controls and ethical practices across our operations and supply chains, FM enhances service reliability, mitigates operational risks and upholds the standards expected by customers, employees, investors, partners and regulators. This approach protects the integrity of our business while supporting sustainable, dependable growth across all stakeholder relationships.
MANAGING EMISSIONS THROUGH FLEET AND ENERGY TRANSITION
Reducing carbon emissions is a complex but necessary part of FM's sustainability journey. While the transition is not without challenges, we are taking measured steps that balance operational needs with long-term environmental goals.
In FY2025, progress was made on two fronts: fleet modernisation and renewable energy adoption. Through partnerships with Scania Malaysia, JAC Motors Malaysia and Solarvest Energy, FM procured 20 Euro 5-compliant prime movers, two electric trucks for urban logistics and expanded solar installations across our warehouses.
These initiatives are beginning to show results. The new vehicles reduce fuel consumption and maintenance downtime, while expanded solar capacity, now producing close to 2,000 megawatt-hours annually, lessens reliance on the national grid and curbs greenhouse gas emissions. Plans for the Lot 24 and Lot 16 warehouses to integrate solar power generation are also underway, adding renewable capacity that will further strengthen the resilience and efficiency of our logistics network.
Given its reliance on road transport and warehousing, the logistics sector plays a pivotal role in Malaysia's carbon reduction agenda. We are gearing up to shoulder greater responsibility in reducing transport-related emissions, extending to our facilities and the broader supply chain.
FM's efforts, though gradual, reflect this crucial direction. Our approach is to first strengthen emission-reduction measures within Malaysia and then progressively implement these practices to regional operations. In doing so, we not only support the country's climate goals but also build a more resilient platform to meet the evolving expectations of our diversified customer base, potential clients, regulators and stakeholders.
WHAT COMES NEXT
Over the past years, our decision to expand internationally has strengthened the Group's business and contributed positively to overall performance. Today, our Overseas Operations account for approximately 35% of Group revenue, complementing the steady foundation of our Malaysian operations. Overall, our international business except Singapore, remains profitable, validating our disciplined approach to entering new markets.
Our Singapore operations, acquired in 2023, are still in its early phase of integration. While near-term performance is moderated by external factors such as elevated costs and shifting regional trade flows, Singapore's strategic position as a regional logistics hub supports our longer-term growth agenda.
We remain selective in our expansion, evaluating risks and opportunities in mature markets, while focusing on geographies where we can build scale and cultivate long-term relationships.
Financially, the Group's revenue rose 16.6% in FY2025, with PBT up 2.4%, though higher operating costs moderated overall profitability. We remain prudent in our capital allocation and investment strategy, directing resources to strengthen the logistics ecosystem. Fleet renewal, warehousing expansion and upgrades, and route optimisation enable us to serve customers more efficiently, while positioning the Group for growth despite uncontrollable external pressures from shifting global trade and market conditions.
ACKNOWLEDGING THE PEOPLE AND PARTNERSHIPS BEHIND US
Because SERVICE MATTERS, I want to take this opportunity, on behalf of the Board of Directors, to express our heartfelt thanks to all who continue to mould FM's journey. The launch of our new identity, including our refreshed logo and branding, reflects a renewed sense of purpose and confidence as we embrace the opportunities ahead and reinforce our commitment to delivering reliable, high-quality service to our customers and stakeholders.
To our shareholders, customers, regulatory authorities, partners and stakeholders, your trust enables us to adapt and deliver consistent growth year after year. Your confidence allows us to stay focused, even amid uncertainty, and to remain forwardlooking as we take measured steps, balancing bold initiatives with calculated risks to expand and strengthen our business in a dynamic environment.
To our Management Team and employees, you are the embodiment of SERVICE MATTERS. Your discipline, professionalism and commitment to delivering value every single day are what sustain FM's reputation and performance. It is through your efforts that we have been able to sharpen our capabilities, expand our network and continue to serve customers by combining efficiency with a level of care and consistency that defines the FM standard.
In conclusion, I would like to commend my fellow Board Members for their guidance, insight and oversight. It is at this time, as FM grows in size and scale, that the Board's steadfast resolve has kept us on course, ensuring responsible, accountable decision-making and a focus on long-term value creation.
At every level, service is what connects us, and it is what will continue to propel FM forward.
Thank you.
TENGKU NURUL AZIAN BINTI TENGKU SHAHRIMAN
Chairperson