FARM FRESH BERHAD

Registration No. 201001010221 (894851-U)

(Incorporated in Malaysia)

MINUTES of the 12th Annual General Meeting of FARM FRESH BERHAD duly convened on a Fully
Virtual through Live Streaming via TIIH Online meeting platform and online voting using the Remote
Participation and Voting (“RPV”) facilities at https://tiih.online on Tuesday, 26 September 2023 at 3.00
p.m.

PRESENT : As per attendance sheet

Shareholders : Individuals - 250

Corporate Representative - 3
By proxy - 112
(of which Chairman acted for 70 shareholders)
Directors : 7
(of which 2 directors are not shareholders)

BY INVITATION : Mr Vengadesh Jogarajah and Mr Tan Beng Keat representatives of

Messrs KPMG PLT (“KPMG”), External Auditor

IN ATTENDANCE : Ms Wong Chee Yin, Company Secretary

CHAIRMAN : Due to health condition, Tan Sri Dato’ Seri Haji Megat Najmuddin Bin
Datuk Seri Dr Haji Megat Khas, the Independent Non-Executive
Chairman of the Company, was unable to attend the Meeting. As such,
the Board has elected Dato’ Dr Quaza Nizamuddin Bin A. Hassan
Nizam, the Independent Non-Executive Director (“Chairman of the
Meeting”), to chair the Meeting.

Chairman of the Meeting then took the Chair and called the Meeting to
order.

QUORUM : There being the present requisite quorum, the AGM was called to order
at 3:04 p.m.

NOTICE : The Notice convening the AGM, as stated in the Annual Report and
properly delivered to the shareholders, was taken as read.

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Minutes of 12th AGM held on 26 September 2023

CHAIRMAN’S ADDRESS

On behalf of the Board of Directors (“the Board”), Chairman of the Meeting welcomed all members
who logged in and participated in the 12th Annual General Meeting (“AGM”) online via the TIIH Online
meeting platform and online voting using the Remote Participation and Voting Facilities (“RPV”) which
is in compliance with Section 327 of the Companies Act 2016.

He then introduced the Board members, Management Team, Company Secretary and Auditors who
attended this AGM remotely through video conferencing.

As part of the good corporate governance, Chairman of the Meeting informed the meeting that there
was a total of 103 proxy forms for a total of 1,505,872,097 ordinary shares representing 80.45% of
the total number of issued shares of the Company being received. Out of those, 70 shareholders
have appointed the Chairman of the Meeting as proxy to vote on their behalf and the shares so
represented were 393,441,160 ordinary shares, representing 21.02% of the total number of issued
shares of the Company.

Chairman of the Meeting informed the members that, in accordance with paragraph 8.29A of Bursa
Malaysia Berhad's Main Market Listing Requirements, all resolutions listed in the notice of general
meeting must be voted on by poll. Therefore, pursuant to the Company’s Constitution, he declared all
resolutions set out in the Notice of the 12th AGM would be put to a vote by poll. The poll will be held
only after the Meeting has deliberated on all the items on the agenda.

He then went over all of the Ordinary Resolutions 1 through 6 as listed in the Notice of 12 th AGM.
The Board and Management Team would address the questions posed by the Shareholders at this
meeting via real time submission of typed texts in the query box. The Board and Management Team
would group the related and comparable questions and provide the answers instead of responding to
every question where the scope of the questions asked overlapped. Shareholders were advised to
limit their questions in relation to the Resolutions mentioned in the Notice of the 12 th AGM. Questions
made during the Q&A session would be attempted to be addressed by the Board and Management
Team. The responses to the remaining questions would be sent to the shareholders via email or
posted on the Company website after the meeting, if answers could not be given due to time
constraint.

After dealing with the questions, the Ordinary Resolutions 1 to 6 would be put to vote remotely using
the remote participation and voting or the RPV facilities.

Tricor Investor & Issuing House Services Sdn Bhd (“TIIH”) was appointed as the Poll Administrator to
conduct the electronic polling process, and Asia Securities Sdn Bhd (“ASSB”) as the Independent
Scrutineer to verify the poll results.

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Minutes of 12th AGM held on 26 September 2023

CHAIRMAN’S ADDRESS (cont’d)

Chairman of the Meeting also reminded everyone connected online that only shareholders of the
Company, their proxies, and authorized representatives of corporate shareholders who registered to
participate remotely were permitted to attend this AGM. Any visual or audio recording during this
AGM would be strictly prohibited unless prior written approval from the Company was obtained.
Discussions at this AGM may be considered confidential and solely for the knowledge of the relevant
parties. The broadcast's quality was heavily reliant on Internet bandwidth and connection stability.

PRELIMINARIES AND AGENDA ITEMS

All members were invited by Chairman of the Meeting to view a video on voting procedures and how
to ask questions during the meeting via the RPV application.

Following the presentation, the Group CFO, En Mohd Khairul Bin Mat Hassan (“Mr Khairul”), was
invited to present the performance overview of Farm Fresh Berhad.

In his opening remarks, Mr Khairul explained the flow of his presentation, which cover the business
overview of the Group, the financial overview, Farm Fresh Berhad’s strategies and growth prospects,
and the Company’s sustainability initiatives.

Mr Khairul highlighted the following :

Operational Highlights:
 The sale of finished goods increased from 78.6 million litres in FY2022 to 93.5 million litres in
FY2023;
 The total herd size has increased from 10,300 in FY2022 to 11,925 in FY2023 due to the herd
expansion and the ramping up of the Taiping farm operations during the financial year;
 The Farm Fresh Grow and Yarra by Farm Fresh are the key products among the 25 new
products launched in the last financial year and being commercialized in FY2023;

Financial Highlights:
 Revenue growth recorded as 25.5% from RM501.9 million in FY2022 to RM629.7 million in
FY2023, at a CAGR of 37% from 2019 to 2023. In tandem with the good revenue growth, the
gross profit for FY2023 climbed by around 10%;
 The growth in Malaysia was mainly driven by volume growth especially with the HORECA
segment which grew significantly from 18% in FY2022 to 26% in FY2023;
 The Australian growth was mainly driven by external sales from the Australian subsidiary,
Goulburn Valley Creamery (“GVC”);

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PRELIMINARIES AND AGENDA ITEMS (cont’d)

Financial Highlights: (cont’d)

 Despite a 4.1% growth in shareholders' equity fund, profit after tax fell to RM49.9 million,
principally as a result of lower gross profit margin during the financial year, higherlabour
expenses, fluctuating foreign exchange rates, increase in feed and fertilizer costs, and dairy
ingredient costs, etc;
 Even though gross profit margin has dropped from 27.2% in FY2022 to 23.8% in FY2023, but due
to the increase in revenue, the gross profit has increased from RM136 million to RM150 million.
 Higher distribution costs for the school milk programme, the ESOS expenses, fair value losses on
biological assets, as well as unrealized losses for forwarding contracts that had been entered,
contributed to the profit margin contracting;
 A significant reversal of tax of RM10.5 million was made in FY2022 for the Larkin facility that had
been recognized in the prior financial year upon the receipt of the tax exemption;
 Growth in UHT milk was primarily due to contributions by the school milk programme which was
one of the big contracts won during the financial year;
 The Group is in a good financial position, with a net gearing ratio of 0.51 times as of 31 March
2023 due to additional financing facilities during the year and increased use of trade and short-
term financial facilities; and
 Average trade payable days have decreased from 35 days to 21 days because of higher
repayment of trade payables during the financial year.

Strategies & Future Prospects

 Continue to develop and grow the product portfolio such as Growing Up milk (“GUM”) in powder
format, and the Cultured Butter line under the St David Dairy to be launched in first half of 2024;
 The Yarra by Farm Fresh and The Inside Scoop Ice Cream are the proven business expansion in
capacity and capabilities across the Malaysian value chain;
 Regional expansion outside Malaysia to The Philippines is currently in the final stages of
machinery installation, and target to begin operations by the end of 2023;
 Continued emphasis on planning and executing its strategies and sustainability with the key
deliverables/missions: better dairy, producing healthy products, proven animal husbandry
practices, and strongly supporting the local community as well as striving towards a healthier
planet through adoption of regenerative and cultured practices and environmentally friendly
initiatives; and
 The Company’s vision, mission and goals are to continue making nutrient-dense products free of
colouring and preservatives and using the purest dairy ingredients.

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PRELIMINARIES AND AGENDA ITEMS (cont’d)

Key Milestones:
 The acquisition of Farm 4 in Kyabram, Australia;
 The acquisition of 90% equity in St David Dairy Pty Ltd in Australia, which has a strong brand
recognition and won various awards. It is a vehicle for the Company to launch its plant-based
products to Cafés and customers in the greater Melbourne area;
 The launch of Farm Fresh Jomcha in October 2022, which has grown to about 40 outlets; and
 Completed acquisition of 65% equity in The Inside Scoop Sdn Bhd on 31 May 2023. This
acquisition will pave way to Farm Fresh’s entry into the consumer packaged goods (CPG) ice
cream market.

Awards & Recognitions

 In November 2022, the Company received the Brand of the Year award under the Dairy Products
category at the 2022-2023 World Branding Awards which was a prestigious award with the award
ceremony held in London;
 Also in November 2022, Farm Fresh Berhad was named in the SL25 list of Asia-Pacific
companies with inspiring sustainability initiatives. This was jointly created by Stewardship Asia
Centre (established by Temasek, Singapore), INSEAD Hoffmann Global Institute for Business
and Society, WTW and The Straits Times;
 In 2023, the Company won the Platinum Award for Beverage – Dairy category in Putra Brand
Awards 2022, and this was the second consecutive win;
 Named as Best IPO for Retail Investors in Southeast Asia and Best Deal of the Year for Minority
Shareholders in Southeast Asia in the Alpha Southeast Asia 16th Annual Best Deal and Solution
Awards 2022.

Empowering People and Communities and Sustainability Highlights

 The Company has assisted the home dealers and stockists to earn a gross income of RM45.4
million in FY2023 under its network;
 The Company supports gender diversity and about 80% of the local micro-entrepreneurs are
female;
 Numerous contributions to the local economy and local communities, such as the Farm Fresh
Scholarships benefiting Orang Asli and underprivileged students, the school milk programme, and
setting-up centres focusing in multi-dimensional programmes for underprivileged students in each
State;
 All the Company’s farms continue to use regenerative agriculture practices. The reduction of
carbon emissions, recycling and removal of farm dairy effluent from waste disposal, installation of
solar panels at the farm facilities, etc are all important steps in the direction of a healthier planet;
and

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PRELIMINARIES AND AGENDA ITEMS (cont’d)

Empowering People and Communities and Sustainability Highlights (cont’d)

 Responsible water management, combating climate change, and eco-friendly product packaging
are some of the Company’s core sustainability initiatives. One of the environmental initiatives was
the introduction of the “Milk on Tap” idea in Kuala Lumpur and Johor Bahru, which aims to reduce
the usage of plastic bottles.

After Mr Khairul’s presentation, Chairman of the Meeting then proceeded with the business of the
Meeting by reading out the agenda items.

1.0 AUDITED FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED 31 MARCH
2023

The Audited Financial Statements for the financial year ended 31 March 2023 (“AFS 2023”),
together with the Directors’ Report and Auditors’ Report thereon were tabled.

Chairman of the Meeting informed that the AFS 2023, together with the Directors’ and
Auditors’ Reports, was meant for discussion only as the Companies Act 2016 did not require a
formal approval of the members for the AFS 2023. Therefore, this item was not put forward for
voting.

Chairman of the Meeting declared that the AFS 2023 together with the Directors’ Report and
Auditors’ Report thereon were thus, taken as received.

2.0 PAYMENT OF A SINGLE TIER FINAL DIVIDEND

Chairman of the Meeting proposed the motion “THAT the payment of a single tier final
dividend of 1.00 sen per ordinary share in respect of the financial year ended 31 March 2023
be and hereby approved” to the meeting for consideration.

The poll on this resolution would be conducted later. Chairman of the Meeting then proceeded
to the next item on the Agenda.

3.0 RE-ELECTION OF DIRECTORS UNDER CLAUSE 76(3)

(i) The members were informed by Chairman of the Meeting that Mr Loi Tuan Ee had retired by
rotation in accordance with Clause 76(3) of the Company’s Constitution. Mr Loi had offered
himself for re-election.

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Minutes of 12th AGM held on 26 September 2023

3.0 RE-ELECTION OF DIRECTORS UNDER CLAUSE 76(3) (cont’d)

Chairman of the Meeting proposed the motion “THAT Mr Loi Tuan Ee be and is hereby re-
elected as Director of the Company to hold office until such time he is due to retire” to the
meeting for consideration.

Chairman of the Meeting proceeded to the next item on this Agenda.

(ii) The members were informed by Chairman of the Meeting that Tan Sri Dato’ Seri Haji Megat
Najmuddin Bin Datuk Seri Dr Haji Megat Khas had retired by rotation in accordance with
Clause 76(3) of the Company’s Constitution. Tan Sri Dato’ Seri Haji Megat Najmuddin had
offered himself for re-election.

Chairman of the Meeting proposed the motion “THAT Tan Sri Dato’ Seri Haji Megat
Najmuddin Bin Datuk Seri Dr Haji Megat Khas and is hereby re-elected as Director of the
Company to hold office until such time he is due to retire” to the meeting for consideration.

Chairman of the Meeting proceeded to the next item on this Agenda.

4.0 PAYMENT OF DIRECTORS’ FEES

The members were informed by Chairman of the Meeting that the proposed resolution was to
facilitate the payment of the Directors’ Fees up to RM550,000.00 per annum to the Directors
for the period from 1 April 2023 until the next AGM in 2024.

Chairman of the Meeting proposed the motion “THAT the payment of Directors’ Fees up to
RM550,000.00 per annum to the Directors for the period from 1 April 2023 to the next AGM of
the Company be hereby approved” to the meeting for consideration.

Chairman of the Meeting proceeded to the next item on the Agenda.

5.0 PAYMENT OF DIRECTORS’ BENEFITS

The members were informed by Chairman of the Meeting that the proposed resolution was to
facilitate the payment of the Directors’ benefits up to RM76,000.00 per annum to Non-
Executive Chairman and Non-Executive Directors for the period from 1 April 2023 until the
next AGM in 2024.

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Minutes of 12th AGM held on 26 September 2023

5.0 PAYMENT OF DIRECTORS’ BENEFITS (cont’d)

Chairman of the Meeting proposed the motion “THAT the payment of Directors’ Benefits up to
RM76,000.00 per annum to Non-Executive Chairman and Non-Executive Directors for the
period from 1 April 2023 to the next AGM of the Company in 2024 be hereby approved” to the
meeting for consideration.

Chairman of the Meeting proceeded to the next item on the Agenda.

6.0 RE-APPOINTMENT OF AUDITORS

Chairman of the Meeting proposed the motion “THAT Messrs KPMG PLT be and is hereby re-
appointed as Auditors of the Company for the financial year ending 31 March 2024 and to
authorize the Directors to fix their remuneration” to the meeting for consideration.

Chairman of the Meeting proceeded to the next item on the Agenda.

7.0 TO TRANSACT ANY OTHER ORDINARY BUSINESS

Chairman of the Meeting informed that the Company had not received any notices from the
shareholders to transact any other business in accordance with the Company’s Constitution
and the Companies Act 2016.

QUESTIONS AND ANSWERS SESSION

As there were no more matters to be discussed, the Meeting went on to the Q&A session, which was
divided into the pre-meeting questions and the live questions presented in the Query Box. The Board
and Management Team answered twelve questions raised by the Minority Shareholders Watch
Group (“MSWG”) and shareholder, and their responses are listed in Appendix “A” of the Minutes.

CONDUCT OF POLL

Having dealt with all the items on the agenda, the meeting proceeded to vote on Resolutions 1 to 6
by poll.

Chairman of the Meeting informed the members and proxy holders who had not voted to cast their
votes accordingly. The voting session was estimated to be closed in 5 minutes.

At 4.20 p.m., Chairman of the Meeting declared the voting session closed and adjourned the meeting
for 20 minutes for the counting of votes.

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Minutes of 12th AGM held on 26 September 2023

CONDUCT OF POLL (cont’d)

Upon completion of the counting of votes by the Poll Administrator and verification of the results by
the Scrutineer, Chairman of the Meeting resumed the meeting at 4.42 p.m. for the declaration of the
results of the poll.

RECEIVING THE POLL RESULTS FOR RESOLUTIONS 1 TO 6

The poll results verified by the Scrutineers, which were announced to Bursa Securities as follows:

Vote For Vote Against

Resolution(s) No. of Units % No. of Units %
Resolution 1 1,298,134,738 99.9993 9,516 0.0007
Resolution 2 1,298,122,815 99.9983 21,439 0.0017
Resolution 3 933,931,555 71.9450 364,187,599 28.0550
Resolution 4 1,294,303,700 99.9888 144,854 0.0112
Resolution 5 1,297,943,281 99.9882 152,873 0.0118
Resolution 6 1,297,949,268 99.9851 192,786 0.0149

Based on the poll results, Chairman of the Meeting declared Resolutions 1 to 6 carried.

CLOSE OF MEETING

There being no further business, the Meeting closed at 4.43 p.m. with a vote of thanks to the Chair.

CONFIRMED

-signed-

DATO’ DR QUAZA NIZAMUDDIN BIN A. HASSAN NIZAM

CHAIRMAN OF THE MEETING

Date: 8 November 2023

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Minutes of the 12th AGM held on 26 September 2023

Appendix A
(be formed part of the Minutes of Meeting)

FARM FRESH BERHAD 12TH AGM – 26/09/2023

QUESTIONS AND ANSWERS SESSION

Dato’ Chairman adjourned the meeting to enable the Board and Management to compile and
address the questions received during the meeting. During the course of deliberation of all the
questions received, Dato’ Chairman had responded to thirteen questions raised by the Minority
Shareholders Watch Group (“MSWG”) and shareholders, and the answers provided by the Board
and Management were as follow:

Minority Shareholders Watch Group MSWG:

1. MSWG Question: What are the products to be produced at the new central
manufacturing hub at Bandar Enstek, and what are the respective manufacturing
capacities? When is the plant expected to be completed and operational?

Company’s Response: The Company plans to produce dairy and plant-based products
in Enstek at which the manufacturing capacity is expected to be more than 30 million litres
per annum, depending on the final production lines being selected. The installation of the
production lines is targeted to be at the beginning of 2025. The Company will also produce
the consumer packaged good (“CPG”) ice cream with the final capacity to be determined
upon finalizing the continuous freezer and extrusion lines to be purchased.

The Enstek manufacturing hub is expected to be operational by first half 2025.

2. MSWG Question: Refer to slide No. 6 of Farm Fresh’s Q1FY2024 result briefing
slides. What are the reasons for the 32.5% drop in the sales volume of UHT School
Milk from 3.4m litres in 1QFY2023 to 2.3m litres in 1QFY24?

Company’s Response: The school milk sales drop is due to the fact that in the preceding
quarter, the delivery requirements by the Ministry of Education was for every month in the
Q1FY23, whereas in Q1FY24 the delivery requirements was only for one month post the
Ramadhan and mid-semester holidays.

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Minutes of the 12th AGM held on 26 September 2023

Appendix A
(be formed part of the Minutes of Meeting)

QUESTIONS AND ANSWERS SESSION (cont’d)

3. MSWG Question: It was reported by the media that a prominent listed food &
beverage player is investing at least RM1b to develop an integrated dairy farm in
Gemas, Negeri Sembilan.

(a) Is the entry of the new player in the production of fresh milk expected to affect the
long-term expansion plan of the Group’s daily herd capacity? Please explain the
answer.

Company’s Response: The entry by new players will not have any impact on our current
expansion plans for dairy herd capacity, as it will be years before the farm can be
operational, not to mention it will be some time before you can determine if the planned
investment becomes a long-term viable farming operation.

We believe that capital investment is just one side of the equation in tropical dairy farming.
The breed matters given the hot and humid temperature, and the animal husbandry skillset
requirement is immense and should not be taken for granted. On the breed side, we have
the advantage of having the Australian Friesian Sahiwal (AFS) breed, which is proven in
tropical climate. This, coupled with the animal husbandry team that we have built over
more than 12 years, places us well in order to attain viable farm operations with decent
yields and longevity of our dairy cows.

In terms of our herd capacity, we are currently adding more barns at our Taiping Farm and
to further increase its capacity to 3,000 dairy cows, and we are expanding our Muadzam
Shah farm with the additional 500-acres leased from the Pahang State Government, with
an aim to double out farm capacity to 6,000 dairy cows in another 2 years.

(b) With total landbank size of 5,367 acres, is the Group actively looking for opportunity
to expand its landbank for dairy farm?

Company’s Response: Given the growing demand for our products along with our
regional expansion, we are actively looking for more land which can be utilized for dairy
farming to achieve higher milk production in order to cater to all the future demand whilst
increasing Malaysia’s self-sufficiency level (SSL) of fresh milk.

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Minutes of the 12th AGM held on 26 September 2023

Appendix A
(be formed part of the Minutes of Meeting)

QUESTIONS AND ANSWERS SESSION (cont’d)

4. MSWG Question: While the Group’s revenue jumped 25.46% from a year to
RM629.691m FY2023, the selling and distribution expenses grew at a faster pace of
61.58% to RM51.71m. Please explain the significant increase in the Group’s selling
and distribution expenses.

Company’s Response: The significant increase is a result of higher overall sales and
specifically distribution costs incurred for the School Milk Programme which is performed
by the stockists and home dealers who distributed over 62 million packs of milk to about
3,400 schools, as well as the higher marketing spend incurred as brand-building
investment and advertisement and promotion on new product launched during the
financial year, which includes our growing up milk (GUM) and Yarra by Farm Fresh.

5. Shareholder’s Question: Farm Fresh should consider lowering the cost of the
yogurt packaging. Any thoughts to repackage it without the inclusions of a spoon
perhaps to lower cost and compete with other brands such as Fernleaf which is
selling at RM1.30 lower in pricing while Farm Fresh’s yogurt is currently selling at
RM2.90. Also, in terms of distribution of product, we can’t seem to find Farm Fresh
yogurt at 99 Speedmart.

Company’s Response: The selling price of Farm Fresh yogurt is high if compared to
other competitors because of the ingredients used. Most of the local yogurts are made
from skimmed milk powder. Our costs are high, due to the usage of premium ingredients
such as fresh milk instead of skimmed milk powder, with no preservatives and colourings
added. The Management is optimistic about the yogurt category’s future growth. Farm
Fresh increased its capacity for yogurt products last year, and given the positive response,
this product category will be vigorously pushed this year. We’ll probably stay in this
position so we may compete in the market with our high-quality ingredients and superior
tastes.

The 99 Speedmart generally has very limited chiller space, therefore, we were only able
to increase the shelf-spacing at those new outlets. We will continue to configurate a
planogram which hopefully will add more of our products at 99 Speedmart locations in the
coming months.

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Appendix A
(be formed part of the Minutes of Meeting)

QUESTIONS AND ANSWERS SESSION (cont’d)

6. Shareholder’s Question: Can we buy a dozen Farm Fresh Yarra UHT milk direct
from the Farm Fresh instead of going through 3rd party sellers and would there be
a difference in terms of price?

Company’s Response: In order to benefit from the rapidly expanding e-commerce sales,
we are now investing in Farm Fresh’s digital channel. Our official Farm Fresh Shopee
and Lazada stores are already set up. TikTok live streaming is being carried out frequently,
allowing our customers to take advantage of Farm Fresh’s promotions from time to time.

7. Shareholder’s Question: As compared to your competitors, Farm Fresh is selling

the 400g yogurt at RM6.30 which is priced relatively higher. Why is there such a
gap between the two and is there any difference in terms of this quality?

Company’s Response: Farm Fresh’s product has higher product costs because it uses
fresh milk ingredients. Farm Fresh yogurt offers superior creamy taste and texture that
set it apart from other products on the market.

8. Shareholder’s Question: Any strategy to overcome 2024 challenge?

Company’s Response: In term of the cost challenge we encountered in FY2023, we

have undertaken numerous cost control measures as a means of overcoming the difficult
cost environment. For instance, we have reduced our purchases of milk from third-party
farmers in Australia. The reduction is aimed to mitigate to the overall impact of Australian
farmgate prices to our financial results, which have remained high and is disconnected
from global milk prices, as well as to lessen our reliance on third-party milk by increasing
our own milk production in FY2024. In the current financial year, we are purchasing only
approximately 14% from the third-party farmers in Australia in contrast to the 30% from
the previous year. This shift significantly reduces our exposure to Australian milk prices.

Furthermore, a 5% increase in chilled milk prices has been implemented since middle of
July this year which has contributed to a boost of our profit margin in August and
September this year.

Regarding cost management, we are able now to purchase the whole milk powder at lower
costs than the prices we have the previous year. Whole milk powder prices had increased
greatly because of the conflict in Ukraine, reaching a record high of around USD4,700/MT,
but they have now sharply decreased to under USD3,000/MT.

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Appendix A
(be formed part of the Minutes of Meeting)

QUESTIONS AND ANSWERS SESSION (cont’d)

Additionally, we are looking into ways to enhance both our upstream and downstream
operations. For instance, hedging against corn purchases and locking in a large portion
of our USD exposure are both favourable to our business operations.

9. Shareholder’s Question: The quantity of dairy herds increased by 15.85% in FY2023

vs FY2022. However, the raw milk quantity produced from the dairy herds only
increased by 4.5% in FY2023 (Note 5 – Page 217 of AR). (i) Why is there such a big
difference from the increase in quantity of cows and milk produced? (ii) What is
Management’s target for the increase for raw milk production in FY2024?

Company’s Response: In general, the size of the herd is a good indicator of how much
milk will be produced. The more dairy cows we have, the more raw milk output is
anticipated to increase. However, some of our dairy cows are non-milking cows. For
instance, we import heifers from Australia, and the heifers take a few months to calve.
Besides, there is a certain percentage of cows are not milking depends on their lactation
cycle.

We are looking to increase our milk production in FY2024. We’ve installed a new rotary
milking station in Australia, and plan to add 500 additional dairy cows to raise this year’s
production of Australian milk from 18 to 20 million litres, whereas in Malaysia we target to
improve milk production from 17 to 18 million litres. Our raw milk production target in
FY2024 is about 35 to 38 million litres.

10. Shareholder’s Question: The Capital Expenditure commitment contracted but not
provided for PPE increased 6.5X to RM22,242,517 in FY2023 (Note 30 – Page 262 of
AR). (i) What are the major items for this Capex allocated? (ii) What is the total
Capex planned for FY2024?

Company’s Response: The following is the capital expenditures in FY2023:

 For Philippines – invested approx. RM8.0 million;

 Muadzam Shah – invested approx. RM9.0 million for the installation of an extra line;
and
 Taiping Plant – invested approx. RM2.5 million capital commitment.

For FY2024, Farm Fresh plans to spend around RM90 million CAPEX for Taiping,
Muadzam Shah, Philippines, and constructions works at Bandar Enstek.

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Appendix A
(be formed part of the Minutes of Meeting)

QUESTIONS AND ANSWERS SESSION (cont’d)

11. Shareholder’s Question: The Group’s tax expenses are lower than the statutory
rate due to tax incentive. (i) What are the difference for the tax incentives under
ECER and those granted by MOF (Note 9 & 22 of FS). (i) What is the effective tax
rate reported in FY2023? (iii) What is the tenure of the tax incentives granted under
ECER and by MOF?

Company’s Response: We negotiated the tax incentives with the Ministry of Finance
(“MOF”) and Ministry of Agriculture and Food Security Malaysia (“MAFS”) under a variety
of conditions. Different terms and conditions apply; for instance, the East Coast Economic
Region (“ECER”) tax incentive is provided under the MIDA-awarded Corridor. All of these
are statutory tax exempt for ten (10) years. Therefore, the Larkin plant will benefit from
the tax incentive from 2021 to 2030, while the ECER tax incentive will be in effect from
2020 to 2029. The effective tax rate for FY2023 is 4.3%.

12. Shareholder’s Question: The land area of farms in Australia as listed under Top 10
Properties of the Group (Page 280 of AR) are much larger than the total farm areas
in Malaysia together with substantial higher Net Book Value. However, Australia
only contributed 15% of the Group Revenue in FY2023 as presented to the CFO.
Please explain the reason(s) for the low contribution from Australia.

Company’s Response: The Australian farm contributes significantly to the supply of raw
milk used by the Malaysian operations. The Company made the investment in a dairy
farm in Australia that supplies milk to the Kyabram facility and serves as a breeding ground
for the AFS breed. The Holstein cows that will be delivered to Malaysia will be fertilized
with AFS semen. The farm produces a very high yield of milk because of the very high
performing Holstein breed that they have over there. The Kyabram facility will process the
milk and ship it to Malaysia along with the milk that we bought from the third-party
Australian farmers.

Australian operations in actual fact generates significantly more revenue before

elimination of inter-company transactions (i.e. supply of milk to Malaysia). However, after
elimination, as presented in the breakdown of our revenue, this amount is reduced
significantly by the inter-company elimination.

Another factor is that we have also streamlined and reorganized the IXL fruit jam and
sauces business in order to minimize the operation as we reduced the losses we suffered
from Australia.

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