EMBRACING

NEW RETAIL

MyAEON App

ANNUAL REPORT

2020
AEON Taman Maluri Shopping Centre, Kuala Lumpur

COVER RATIONALE

EMBRACING NEW RETAIL

FY2020 has been a catalytic year of transformation and progress,
spearheaded through AEON’s many digitalisation initiatives. The Company’s
transformation journey has opened many exciting retail opportunities
including enabling AEON to effectively deliver its New Retail Model and to
offer seamless offline to online customer shopping experiences. Driven by
new strategies for a new normal, AEON shall continue to move forward with
speed and agility while continuing to address the pulse of the customers.
WHAT’s
INSIDE
06 - 47 108 - 179
CORPoRATE AND Financial
BUSINESS OVERVIEW Statements

06 About AEON 108 Directors’ Report

08 Corporate Information and 112 Statement of Financial Position
Directory 113 Statement of Profit or Loss and
09 Five-Year Financial Highlights Other Comprehensive Income
10 Share Price and Financial 114 Statement of Changes In Equity
Charts 115 Statement of Cash Flows
11 Chairman’s Statement 118 Notes to the Financial
15 Board of Directors’ Profiles Statements
23 Senior Management 174 Statement by Directors and
27 Management Discussion and Statutory Declaration
Analysis 175 Independent Auditors’ Report
40 Event Highlights

50 - 81
Sustainability 182 - 204
Statement others

50 Sustainability Statement 182 Analysis of Shareholdings

182 Substantial Shareholders
182 Directors’ Interest

84 - 105 183 List of Thirty (30) Largest

Shareholders
Corporate Governance 185 Particulars of Properties
187 Aeon Stores, Aeon Malls
84 Corporate Governance and MaxValu
Overview Statement 191 Our Milestones
96 Audit and Risk Management 195 Notice of Annual General
Committee Report Meeting
100 Statement on Risk Management 197 Notice of Dividend Payment
and Internal Control
200 Administrative Details
104 Additional Compliance
Information Proxy Form Scan the QR code to
105 Statement of Directors’ get AEON Malaysia’s
Responsibility Annual Report 2020
online in PDF format.

ANNUAL REPORT 2020 01

KICKSTART
ITS NEW RETAIL
ECOSYSTEM
Seamless OFFLINE AND ONLINE shopping in
one integrated platform

COVID-19 has been the game changer for many industries in accelerating
the digital platform for businesses globally. Customers are more tech savvy
and in this digital age, AEON has kickstarted its new retail experience by
launching its own Offline to Online (“O2O”) ecosystem platform to offer
customers the choice of shopping at an AEON store or from the comfort of
their homes.

Shop online now at

fresh.myaeon.com.my
myaeon.com.my
myaeon-sg.com

02 AEON CO. (M) BHD.

5
key
01
To prepare AEON employees,
customers, and stakeholders
02
To create inclusivity of AEON
stakeholders in a new living
for new business, driven by zone.
objectives digital disruption.

03 04 05
To build AEON digital To promote local community To promote transparency
infrastructure in order to growth by providing more and openness by leveraging
be agile to weather future opportunities for participation on technology.
business disruptions. in the digital economy.

ANNUAL REPORT 2020 03

corporate and Business oveRview

04 AEON CO. (M) BHD.

 06 - 47
CORPORATE
AND BUSINESS
OVERVIEW

06 About AEON

08 Corporate Information
and Directory

09 Five-Year Financial
Highlights

10 Share Price and

Financial Charts

11 Chairman’s Statement

15 Board of Directors’
Profiles

23 Senior Management

27 Management
Discussion and Analysis

40 Event Highlights

ANNUAL REPORT 2020 05

corporate and Business oveRview

ABOUT
WE ENRICH PEOPLE’S LIVES BY PROVIDING Quality PRODUCTS AND
SERVICES THAT OUR CUSTOMERS APPRECIATE AND DEPEND ON.

our Philosophy

Customer First
The AEON Group of Companies is an integrated Japanese retailer in Japan, ASEAN
and China. At all times, in every market, AEON’s activities are guided by its unchanging
‘Customer First’ philosophy. Its aim is to surpass expectations by combining excellent
products with unique personal services that enhance the shopping experience
to make customers smile every time they shop.

The Business Purpose which make up the essence of our operations are encapsulated
into three key pillars namely; PEOPLE, PLANET and PEACE.

people planet peace

AEON respects human AEON is committed to AEON’s business
dignity and values personal protecting the environment, operations are focused on
relationships, caring for the biodiversity and achieving peace through
wellbeing of its employees, ecosystems. prosperity and the beauty of
customers, business partners sharing.
and communities.

OUR STRATEGY

Underlying SDGs
The six United Nations Sustainable Development Goals (SDGs) with three Business Philosophies and
three Business Approaches are the guides to our five Key Strategic Pillars.

06 AEON CO. (M) BHD.

 3 business philosophies

1 2 3
demand chain business snipering & Transparency
Understanding the needs of PERSONALISATION Communications between
customers and making these Targeted and segmented employees, customers and all
our first priority customer segment stakeholders

3 business approaches

Agile Genba Entrepreneurial

5 Key Strategic Pillars

present: value capture future: digital transformation

enhance our ENERGISE PEOPLE enable entrepreneurial EMPOWERED

engine 1.0 & ORGANISATION engine 2.0 data driven ecosystem
technology

A LEADING CHAIN OF Departmental Store, SUPERMARKETS AND MALLS

AEON CO. (M) BHD. (“AEON” or “the Company”) was incorporated on 15 September 1984 in Malaysia. AEON was
set up in response to the Malaysian Government’s invitation to help modernise the country’s retailing industry.
AEON’s chain of stores strives to satisfy the ever-changing needs and desires of consumers and the brand
AEON today is well established among Malaysians.

Guided by its “Customer First” philosophy, the company’s acute understanding of the target market needs,
aided by optimal product-mix, AEON surpasses consumer expectations and enhances their experience every
time they shop.

In the spirit of the name AEON, which means eternity in Latin, AEON’s goal is to work together endlessly with
its customers, suppliers, business partners, shareholders and the community to create a future of limitless
possibilities.

OUR STRENGTH
As at 16 April 2021

AEON AEON AEON MAXVALU/

MALL store MAXVALU PRIME AEON EMPLOYEES AEON TENANTS

28 34 9 10,300+ 2,890
AEON Total outlets SUPPLIERS AND FY2020 GROSS SALES
WELLNESS DAISO in malAysia BUSINESS PARTNERS
RM4.253
66 44 181 2,766 BILLION
ANNUAL REPORT 2020 07
corporate and Business oveRview

Corporate Information
and Directory

BOARD OF DIRECTORS AUDITORS PRINCIPAL BANKERS

Datuk Iskandar bin Sarudin KPMG PLT MUFG Bank (Malaysia) Berhad
(Chairman) (LLP0010081-LCA & AF 0758) [Registration No. 199401016638(302316-U)]
Chartered Accountants
Malayan Banking Berhad
Shafie bin Shamsuddin Level 10, KPMG Tower
[Registration No. 196001000142(3813-K)]
8, First Avenue, Bandar Utama
47800 Petaling Jaya CIMB Bank Berhad
Tsutomu Motomura
[Registration No. 197201001799(13491-P)]
(appointed on 21 January 2021)
Tel: 03-7721 3388
Mizuho Bank (Malaysia) Berhad
Fax: 03-7721 3399
Datuk Syed Ahmad Helmy bin [Registration No. 201001039768(923693-H)]
Syed Ahmad RHB Bank Berhad
SHARE REGISTRAR [Registration No. 201001039768(923693-H)]
Dato’ Tunku Putra Badlishah Ibni
Tunku Annuar Sumitomo Mitsui Banking Corporation
Tricor Investor & Issuing House Malaysia Berhad
Services Sdn Bhd [Registration No. 201001042446(926374-U)]
Abdul Rahim bin Abdul Hamid [Registration No. 197101000970(11324-H)]
Unit 32-01, Level 32, Tower A
Chong Swee Ying Vertical Business Suite
Avenue 3, Bangsar South
Soichi Okazaki No. 8, Jalan Kerinchi Corporate
(appointed on 25 June 2020) 59200 Kuala Lumpur
Calendar
Hiroyuki Kotera Tel: 03-2783 9299
(resigned on 21 January 2021) Fax: 03-2783 9222 NOTICE OF ANNUAL
GENERAL MEETING
• 22 May 2020
SECRETARIES DATE OF INCORPORATION
ANNUAL GENERAL
Tai Yit Chan 15 September 1984
MEETING
(SSM PC NO. 202008001023)
• 24 June 2020
(MAICSA 7009143)
STOCK EXCHANGE LISTING
Tan Ai Ning PAYMENT OF DIVIDEND
(SSM PC NO. 202008000067) The Company is a public listed • Book Closure 16 July 2020
(MAICSA 7015852) company, incorporated and domiciled • Payment 30 July 2020
in Malaysia and listed on the Main
Market of the Bursa Malaysia QUARTERLY RESULTS
REGISTERED OFFICE AND Securities Berhad. ANNOUNCEMENTS
HEAD OFFICE • 1st Quarter 20 May 2020
Stock Name: AEON
• 2nd Quarter 27 August 2020
3rd Floor, AEON Taman Maluri Stock Code: 6599
Shopping Centre • 3rd Quarter 25 November 2020
Jalan Jejaka, Taman Maluri • 4th Quarter 24 February 2021
Cheras, 55100 Kuala Lumpur HOMEPAGE

Tel: 03-9207 2005 www.aeonretail.com.my

Fax: 03-9207 2006/2007

08 AEON CO. (M) BHD.

 Five-Year
Financial Highlights

2020 2019* 2018 2017** 2016***

Year Ended 31 December RM'000 RM'000 RM'000 RM'000 RM'000
Financial Results
Revenue 4,051,302 4,538,884 4,353,640 4,123,351 4,018,688
Retailing 3,444,661 3,832,247 3,666,306 3,458,981 3,417,676
Property management services 606,641 706,637 687,334 664,370 601,012
EBITDA 746,127 843,402 532,568 524,587 462,304
Profit before tax 101,756 196,887 187,038 193,806 163,029
Profit after tax 41,423 109,292 105,123 105,007 90,892
Profit attributable to owners of the Company 41,423 109,292 105,123 105,007 90,892
Net dividend 21,060 56,160 56,160 56,160 42,120
Financial Positions
Assets
Property, plant and equipment and Intangible
assets 3,376,593 3,659,183 3,713,634 3,521,273 3,455,704
Right of use assets 1,689,636 1,772,427 – – –
Investments 57,848 76,600 82,106 92,690 101,427
Deferred tax assets 147,071 120,059 2,242 – –
Other non-current assets 18,424 19,024 17,954 17,427 16,771
Current assets 803,819 890,481 830,770 778,174 839,814
Total Assets 6,093,391 6,537,774 4,646,706 4,409,564 4,413,716
Equity
Share capital 702,000 702,000 702,000 702,000 702,000
Non-distributable reserves 54,698 64,636 70,023 61,478 43,429
Retained earnings 914,297 929,034 1,248,352 1,199,389 1,136,502
Total equity attributable to owners of the
Company 1,670,995 1,695,670 2,020,375 1,962,867 1,881,931
Liabilities
Borrowings 933,580 928,660 995,423 937,670 965,392
Lease liabilities 2,230,339 2,293,098 – – –
Deferred tax liabilities – – – 11,316 27,990
Other liabilities 1,258,477 1,620,346 1,630,908 1,497,711 1,538,403
Total Equity and Liabilities 6,093,391 6,537,774 4,646,706 4,409,564 4,413,716
Financial Indicators
Earnings per share (sen) 2.95 7.78 7.49 7.48 6.47
Net dividend per share (sen) 1.50 4.00 4.00 4.00 3.00
Net assets per share (RM) 1.19 1.21 1.44 1.40 1.34
Net debt to equity (%) **** 51.60 50.82 45.20 43.77 46.97
Return on equity (%) 2.48 6.45 5.20 5.35 4.83
Price earnings ratio 36.27 18.25 19.63 23.53 39.72
Share price as at December (RM) 1.07 1.42 1.47 1.76 2.57

Notes:
* The Company adopted MFRS 16, Leases replacing MFRS 117, Leases from 1 January 2019.
** The amounts presented for 2017 have been adjusted upon adoption of MFRS 15, Revenue from Contracts with Customers on 1 January 2018.
*** The amounts presented from 2016 are for company level as the Company pared down its shareholdings in its subsidiary during year 2017.
The amounts presented for 2016 have been restated upon adoption of Amendments to MFRS 127, Equity Method in Separate Financial
Statements.
**** Net debt to equity with lease liabilities included within is recorded at 185.07% as at 31 December 2020 (186.05% as at 31 December 2019).

ANNUAL REPORT 2020 09

corporate and Business oveRview

Share Price and

Financial Charts

SHARE PRICE
2020 STOCK CODE: 6599 STOCK NAME: AEON
Jan FEB MAR APR MAY JUN JUL AUG SEPT OCT NOV DEC
High (RM) 1.450 1.400 1.350 1.160 1.200 1.080 1.030 0.895 0.870 0.795 0.910 1.150
Low (RM) 1.330 1.280 0.910 1.000 1.000 0.990 0.830 0.785 0.760 0.685 0.670 0.865
Volume 30,217 18,776 34,519 29,828 21,980 54,650 55,913 44,481 46,468 41,833 103,130 225,724
(‘000)

revenue RM million
5,000
4,539
4,354
4,051 4,123
4,019
4,000

3,000

2,000

1,000

0
2020 2019 2018 2017 2016

PROFIT ATTRIBUTABLE TO OWNERS OF THE COMPANY RM million

120
109
105 105
100
91

80

60

41
40

20

0
2020 2019 2018 2017 2016

10 AEON CO. (M) BHD.

 Chairman’s
Statement

Dear Shareholders,
Datuk Iskandar
bin Sarudin On behalf of the Board of Directors of AEON CO. (M)
Chairman BHD. (“AEON” or “the Company”), I hereby present
the annual report and audited financial statements
for the financial year ended 31 December 2020
(“FY2020”).

The various challenges YEAR IN REVIEW As most of us are well aware, FY2020
was impacted by the COVID-19
faced during the FY2020 was by far, the most pandemic, an unprecedented black
swan event. The retail sector in
financial year served challenging year for our business.
particular was affected by the onset
However, the various challenges
as catalysts for faced during the financial year served of a new normal as consumers’

AEON to quantum as catalysts for AEON to quantum consumption patterns and behaviours
leap our digital journey, while further shifted rapidly during the pandemic
leap our digital journey. establishing our brand as a leading period.
household name in Malaysia.
Even industries deemed essential
Embracing and adapting to the services faced various operational
prevailing scenario in FY2020, AEON and logistical issues, amidst reduced
has continued to achieve steady consumer spending and consumption.
progress in the realisation of its
transformation journey. FY2020 has AEON rose to meet the
made AEON more customer driven, aforementioned challenges in a
market focused and technologically proactive and strategic manner. By
driven towards further developing its drawing on our organisational culture
living zone ecosystem. and our people, our inherent business
strengths and from our business
approaches of Agile, Genba and

ANNUAL REPORT 2020 11

corporate and Business oveRview

Chairman’s
Statement

Entrepreneurial, we have weathered

the storm to emerge more resilient,
flexible and ready for the future.

For FY2020, AEON recorded another

year of profitability and has continued
to reward shareholders with dividends.
We have continued to operate as
usual, albeit with compliance to
COVID-19 SOPs, ensuring reliability
and providing trust and confidence
to consumers; that AEON is there for
them to meet their basic needs during
this most crucial time. AEON Malaysia Chairman Datuk Iskandar bin Sarudin (right) receiving Best Taxpayer
Award 2020 on behalf of AEON from Finance Minister Yang Berhormat Tengku Datuk Seri
Equally noteworthy, beyond business Utama Zafrul Tengku Abdul Aziz (middle).
and operational achievements, the
Board draws a measure of satisfaction Our efforts have been fruitful as revenues, profit from operations was
that AEON has continued to care AEON in FY2020 achieved a tenancy lower at RM259.3 million, 27.7% lower,
for the people in its ecosystem. This occupancy rate of 83.8%. year-on-year.
includes employees, tenants, vendors,
suppliers and customers. These and other highlights and The Company has undertaken
achievements are captured in the various strategic measures to yield
One key highlight is our support in Management Discussion and Analysis cost and operational efficiencies and
assisting our tenant community to (“MD & A”) section of this annual also to increase brand visibility as
transition into the digital marketspace report. I invite you to review the MD well as presence within the digital
and also to improve their brand visibility. & A towards gaining a more informed marketspace. Efforts have also
Beyond providing rebates, discounts perspective of how AEON has created been placed in ensuring healthy
and incentives, we have also provided value in FY2020 for itself and others, and sustainable profit margins for
tangible support in expanding their and essentially how we have come our products amidst mismatch and
market reach, improving operational out from FY2020 better, stronger and disruption of supply chains in FY2020.
efficiency via back-office support, more prepared for the future.
providing avenues online to reach With this, AEON has achieved reduced
customers and more. FINANCIAL PERFORMANCE Operating Expenses (“OPEX”), while
growing its market presence. Online
In FY2020, AEON posted revenue of sales have seen notable improvements
RM4.051 billion, 10.8% lower compared in FY2020, year-on-year.
revenue to the previous financial year’s

10.8% RM4.539 billion. Company topline

performance was lower, attributed
to reduced revenue contribution
The Company’s balance sheet remains
fundamentally robust with healthy
cashflows and a robust cash position
RM4.051 billion particularly from the retail business
segment. On the back of reduced
to meet working capital requirements.

2019: RM4.539 billion

OPERATING PROFIT

27.7%
RM259.3 million
2019: RM358.7 million

12 AEON CO. (M) BHD.

 Chairman’s
Statement

Specific details on the Company’s

financial performance is given in the
MD & A section of this annual report.

On the back of hard-won efficiencies,

improved productivity and new
offerings based on our innovative
digitalisation strategies, the Board
and Management are optimistic of
an improved business and financial
performance in FY2021.

SAFEGUARDING OUR PEOPLE

Beyond business and operational

performance, we have been fully AEON continued to pursue its CSR efforts notwithstanding the disruptive effects of the
committed to keeping our workforce pandemic.
healthy and safe, not forgetting our
valued customers, tenants and other SUSTAINABILITY AND Other activities held in FY2020 were
stakeholders. CORPORATE SOCIAL the Kotak Merdeka programme, Piece
RESPONSIBILITIES of Love campaign, AEON Berkat
In FY2020, all required measures as Ramadan and AEON Berkat Korban
per the Government’s SOPs for retail AEON champions six United Nations initiatives, flood relief and homecare
sector operations were implemented Sustainable Development Goals assistance and also Tabung AEON di
to keep the AEON community within (“SDGs”). These are SDG 3: Good Hatiku – A Mask Story.
our ecosystem as safe as possible from Health and Well-being, SDG 4: Quality
COVID-19. We complied with all SOPs Education, SDG 8: Decent Work & Specific details of these CSR
and most importantly, our employees Economic Growth, SDG 12: Responsible programmes and initiatives are
were excellent for their discipline Consumption & Production, SDG provided in the Sustainability
and strict adherence to SOPs. Their 15: Life On Land and SDG 16: Peace, Statement section of this report.
contributions in particular, have Justice and Strong Institutions.
enabled a safer shopping environment OUTLOOK AND PROSPECTS
across all AEON properties. The adopted United Nations SDGs
are further linked to AEON’s key While a return to pre-COVID normalcy
Beyond SOPs compliance, the Board is pillars of business purposes namely can only be expected at the start
pleased to say that AEON has looked People, Planet and Peace (3Ps). of FY2022, the various strategic
after the wellbeing of its employees. I Consistent with these SDGs, AEON efforts undertaken in FY2020 are
wish to highlight that despite reduced has continued to pursue its Corporate beginning to show positive results for
consumer spending and retail appetite, Social Responsibilities (“CSR”) efforts the Company going into the second
Management has not resorted to laying notwithstanding the disruptive effects quarter of FY2021.
off employees. We have remained true of COVID-19.
to our ethos; that AEON is a “family” Despite the continued lingering
that takes care of its own, even during In FY2020, from frontliners to effects of COVID-19, AEON is seeing
the most difficult of times. displaced members of society; to those stronger growth and customer
who have lost their livelihoods, AEON traction, amidst a highly competitive
We will continue to focus on further has stepped forward to lend a wide retail landscape with many
developing AEON. The Board and range of financial and non-financial established and new players.
Management will continue to drive assistance. Programmes and events
the democratisation of resources to held included (but were not limited We draw confidence that the
develop a retail ecosystem driven to) assistance provided to the police government’s ongoing vaccine
by technology and integrated with force and army personnel, distribution dissemination campaign will help to
the human elements of retail. This of home care boxes, chairs and other restore consumer confidence and
approach will be key to driving our amenities to healthcare frontliners in progressively, a stronger appetite
growth and progress going forward. hospitals and more. to spend on the back of pent-up

ANNUAL REPORT 2020 13

corporate and Business oveRview

Chairman’s
Statement

AEON thanks them for their tenure of

service and for having played a pivotal
part in the Company’s journey of
growth. Notably, for their stewardship
and contributions during the first half
of FY2020 and at the height of the
virus pandemic period.

In the same vein, I also wish to

acknowledge Mr Hiroyuki Kotera, who
retired from the Board on 21 January
2021. The Board extends it sincere
appreciation to Mr Kotera for the
significant role he has played since his
ascendance to the Board in FY2016.
demand and improving incomes, AEON is poised to develop a New We give all retired directors our wishes
going forward. Retail Model that focuses on providing for their future endeavours.
seamless offline to online customer
Our focus in FY2021 is to drive our New experiences. At the same time, on behalf of the
Retail ecosystem, while continuing to Board, Management and staff, I am
exercise vigilance against external ACKNOWLEDGEMENTS pleased to welcome two new board
challenges. This includes ensuring members, Mr Soichi Okazaki who
continued compliance to all SOPs In an unprecedented year of change came on board on 25 June 2020 and
during the transitionary, recovery and challenge, the Board wishes to Mr Tsutomu Motomura who joined us
period of FY2021. firstly thank the AEON workforce, on 21 January 2021. I am confident
whose stellar contributions during with Mr Okazaki’s illustrious 40 years
We have drawn up strategies that will the pandemic year have been so of experience within AEON Group
enable a more customer oriented stance instrumental in our FY2020 narrative ranging from executive to chairmanship
as the pandemic scenario dissipates of continued resilience and progress. serving in over three countries, and Mr
over time and a pre-COVID-19 scenario Motomura’s extensive experience in
emerges. Their willingness to adapt to the marketing, sales numerical and retail
new normal; to make personal and management will add further strength
In the longer term, the adopted six professional sacrifices and to uphold a and wisdom to the Board.
United Nations SDGs that have been high level of professionalism is greatly
encapsulated into three key pillars of appreciated by the Board. We count On a related note, the Board wishes
business purpose, People, Planet and on their continued commitment to to thank our many valued customers,
Peace (3Ps) make up the essence of delivering another year of growth and shareholders, business partners,
our business. progress in FY2021. financiers, government authorities and
statutory bodies for their continuous
We will continue to be led by our 3Ps The Board also wishes to thank support and confidence in the
in delivering both financial and non- the Management of AEON for their Company.
financial value for true, long-term business acumen and strategic
business and operational sustainability. response in ensuring that the Let us all continue to stand united as
Company remained robust during #OneAEON in facing the challenging
In essence, AEON is well positioned FY2021. I also take this opportunity times ahead and remain fully
to remain competitive and to grow to thank my fellow Board members committed for the Company to be
towards being an employer of choice, for their wise counsel and exemplary future ready and continue to grow
a preferred retail and consumer service to the Company; especially from strength to strength.
experience partner store, and a for their contributions on the various
continued leader for exemplary Board Committees.
corporate sustainability and good Thank you.
governance. In particular, I wish to acknowledge Mr
Poh Ying Loo, Mr Charles Tseng and Mr Datuk Iskandar bin Sarudin
By putting people and customers first Yasuo Nishitohge, all of whom retired Chairman
and continuing to embrace technology, from the Board on 24 June 2020.

14 AEON CO. (M) BHD.

 Board of
Directors’ Profiles

Datuk Iskandar
bin Sarudin

Independent
Non-Executive Chairman

Malaysian Aged 66 Male

Date of Appointment to the Board:

27 February 2017

Number of Board Meeting attended:

4/4
Board Committee(s):
• Chairman of Remuneration
Committee
• Chairman of Nomination Committee

Academic/Professional Qualification:
• B.A. (Hons) of Malay Studies in
University of Malaya Datuk Iskandar bin Sarudin was appointed to the Administrative and
• Diploma of Public Administration Diplomatic Service of Malaysia as Assistant Secretary (ASEAN) at the Ministry of
(INTAN) Foreign Affairs in 1979. In 1983, he was appointed as Second Secretary, Embassy
of Malaysia in Jakarta, Indonesia. In 1985, he was appointed as First Secretary,
Directorship(s) in other Public High Commission of Malaysia in Lagos, Nigeria. In 1988, he was appointed as
Companies/Listed Companies: Principal Assistant Secretary (East Asia), Ministry of Foreign Affairs and then as
• Complete Logistic Services Berhad Principal Assistant Secretary (CHOGM), Ministry of Foreign Affairs. In 1991, he
• Eversendai Corporation Berhad was tasked by the Ministry to establish the Embassy of Malaysia in Republic of
Chile and was appointed as Counsellor, Embassy of Malaysia, Santiago, Chile.

In 1995, he was tasked by the Ministry to establish the Embassy of Malaysia in

Sarajevo, Bosnia and Herzegovina and was appointed as Counsellor, Embassy
of Malaysia, Sarajevo, Bosnia and Herzegovina. He was the Deputy Director
General (ASEAN), Ministry of Foreign Affairs in 1998. From 2000 to 2004, he was
appointed as High Commissioner of Malaysia to Sri Lanka and High Commissioner
of Malaysia to Republic of Maldives. From 2003 to 2004, he was President of
Colombo Plan Organization, Colombo. From 2004 to 2006, he was Ambassador
of Malaysia to the Republic of Philippines.

In 2006, he was the Deputy Secretary General (Management Affairs) Ministry

of Foreign Affairs responsible for service, finance, administration, security, ICT
and consular development. In 2010, he was Ambassador of Malaysia to People’s
Republic of China. He is also President of Persatuan Muafakat One Belt One Road
Malaysia since 2016.

ANNUAL REPORT 2020 15

corporate and Business oveRview

Board of
Directors’ Profiles

Shafie bin
Shamsuddin

Managing Director

Singaporean Aged 50 Male

Date of Appointment to the Board:

1 January 2020

Number of Board Meeting attended:

4/4
Board Committee(s):
• Nil

Academic/Professional Qualification:
• Bachelor of Business
Administration, Nanyang
Technological University, Singapore

Directorship(s) in other Public

Encik Shafie bin Shamsuddin started his career as a Management Trainee in
Companies/Listed Companies:
Carrefour Singapore in 1996. He became the first Asian CEO of Carrefour in the
• Petronas Dagangan Berhad
company’s history at the age of 35 years old. He has led Carrefour in Singapore,
Malaysia and Indonesia for 16 years and held the position of Managing Director
and Chief Executive Officer from 2005 to 2011. Encik Shafie has extensive
experience in human capital development and the consumer goods industry. He
held various operational and commercial executive positions over his 20 years of
immersion in the ASEAN region.

From year 2011 to 2012, he was appointed as the Executive Director of Global
Talent Management and Organisational Development of Carrefour Group based
in Paris. In 2013 to 2019, he was the President Director and Chief Executive Officer
of PT Trans Retail Group, based in Jakarta. Since February 2018, he sits on the
Board of Petronas Dagangan Berhad as the Independent Non-Executive Director.
Encik Shafie is also a Managing Director of AEON BiG (M) Sdn Bhd since January
2020. He started his career in AEON, as the Chief Strategy Officer of AEON Asia
Sdn. Bhd. which spanned from July 2019 until December 2019.

16 AEON CO. (M) BHD.

 Board of
Directors’ Profiles

Tsutomu
Motomura

Deputy Managing Director

Japanese Aged 52 Male

Date of Appointment to the Board:

21 January 2021

Number of Board Meeting attended:

N/A
Board Committee(s):
• Nil

Academic/Professional Qualification:
• Bachelor Degree in Business
Administration, Dominican
University, USA

Directorship(s) in other Public Mr Tsutomu Motomura joined AEON Co., Ltd. in June 1993 as Manager of
Companies/Listed Companies: Dining/Department at AEON Kansai Store, Tokyo, Japan. His responsibilities in
• Nil sales floor planning, staff control, education and sourcing earned him the position
as Hardline Manager in April 2000, where he was transferred to AEON Futtsu
Store, in Chiba. With further exposure into marketing, sales numerical and retail
management, he was tasked with his first overseas post in AEON CO. (M) BHD.,
Malaysia as Project Manager in 2002. In his second year in the country, he was
promoted to Senior Manager where he oversaw expansion of AEON stores
nationwide and diversified merchandise.

In March 2008, he returned to Japan to manage AEON Murakami Higashi Store

until March 2010. He served as Store Manager for AEON Noa Store for a year
prior to his promotion as Deputy Managing Director for Beijing AEON, China until
March 2019. Prior to his return to Malaysia, Mr Motomura was a General Manager
for AEON Co., Ltd., Japan, where he helped to develop new specialty business
formats, supporting exports and store openings in China and Asean countries.
Since January 2021, he sits as Deputy Managing Director and an Executive
Director of AEON CO. (M) BHD. He is also a Director of AEON BiG (M) Sdn. Bhd.
since January 2021.

ANNUAL REPORT 2020 17

corporate and Business oveRview

Board of
Directors’ Profiles

Datuk Syed
Ahmad Helmy bin
Syed Ahmad

Independent
Non-Executive Director

Malaysian Aged 74 Male

Date of Appointment to the Board:

16 April 2013

Number of Board Meeting attended:

4/4
Board Committee(s):
• Member of Audit & Risk
Management Committee
• Member of Remuneration
Committee
• Member of Nomination Committee
Datuk Syed Ahmad Helmy bin Syed Ahmad has forty (40) years of
Academic/Professional Qualification: experience as a legal practitioner and judicial officer in Malaysia and Singapore.
• Bachelor of Laws (LL.B) Honours, Datuk Syed started his legal career in 1972 before starting his own partnership
University of Singapore under the name of Yahya Helmy & Co in 1985 and subsequently renamed the law
firm to S.A. Helmy & Partners. He was then appointed as High Court Judge for
Directorship(s) in other Public High Court of Malaya – Johor Bahru, High Court Judge for High Court of Malaya
Companies/Listed Companies: – Shah Alam and Court of Appeal Judge for Court of Appeal, Putrajaya in year
• Nil 2000, 2007 and 2009 respectively. He retired as a Judge in December 2012 and
was appointed as the Chairman of Advocates & Solicitors Disciplinary Board.

18 AEON CO. (M) BHD.

 Board of
Directors’ Profiles

Dato’ Tunku
Putra Badlishah
Ibni Tunku
Annuar

Independent
Non-Executive Director

Malaysian Aged 56 Male

Date of Appointment to the Board:

16 April 2013

Number of Board Meeting attended:

4/4
Board Committee(s):
• Member of Audit & Risk
Management Committee
• Member of Nomination Committee
Dato’ Tunku Putra Badlishah started his career as Account Manager in J.Walter
Academic/Professional Qualification: Thompson Advertising in 1987 and subsequently joined DMIB Berhad as Senior
• BSc (Hons) in Business Executive - Communications in 1989 and thereafter was promoted as Marketing
Administration Manager. From January 1992 to December 1995, he worked in Sandestin Resort,
Florida, United States of America as Manager of Marketing and Development.
Directorship(s) in other Public He joined the Sime Darby Group in January 1996 and had held various senior
Companies/Listed Companies: positions within the Group, amongst them act as Senior Manager in Sales &
• Nil Marketing of Sime Darby Land Sdn. Bhd. (January 1996 to July 2000), General
Manager – Sales & Marketing of Auto Bavaria (August 2000 to March 2004),
Managing Director of Auto Bavaria (February 2004 to March 2005), Director of
Operations of Sime UEP Properties Berhad (April 2005 to December 2005) and
Director - Group Property of Sime Darby Berhad (January 2006 to October 2007).

Dato’ Tunku was appointed as the Executive Vice President - Property Development
& Strategic Investments, Sime Darby Property Berhad from November 2007 to
July 2008 and as Managing Director and Member of the Board of Sime Darby
Healthcare Sdn Bhd and Sime Darby Property Berhad from August 2008 to July
2011, prior to founding the Putra Group of Companies. He is currently the Executive
Chairman of Putra Ventures Sdn Bhd and Putra Land Sdn Bhd.

ANNUAL REPORT 2020 19

corporate and Business oveRview

Board of
Directors’ Profiles

Abdul Rahim bin

Abdul Hamid

Independent
Non-Executive Director

Malaysian Aged 70 Male

Date of Appointment to the Board:

16 August 2013

Number of Board Meeting attended:

4/4
Board Committee(s):
• Chairman of Audit & Risk
Management Committee
• Member of Remuneration
Committee

Academic/Professional Qualification:
• Fellow of the Association of Encik Abdul Rahim bin Abdul Hamid started his career in Coopers &
Chartered Certified Accountants Lybrand (previously known as Cooper Brothers & Co.) in 1971. He rose in the
• Member of the Malaysian Institute firm to eventually become its Chief Executive in 1993. When the firm merged
of Certified Public Accountants with Price Waterhouse in 1998 to form PricewaterhouseCoopers, he served as
• Member of the Malaysian Institute its Deputy Executive Chairman until he retired in June 2004. During the span
of Accountants of more than three decades in the firm, he was involved in audit, management
consultancy and insolvency practice covering multiple industries including retail
Directorship(s) in other Public and manufacturing, construction, plantation, entertainment and banking in both
Companies/Listed Companies: public and private sectors. He was also appointed to the Council of the Malaysian
• Petra Energy Berhad Institute of Accountants (“MIA”) and was elected by the Council to hold office as
• Encorp Berhad President.
• GFM Services Berhad
In the education sector, he is an Adjunct Professor of Accountancy at Universiti
Malaysia Terengganu; a member of the Senate at Open University Malaysia; a
member of the Advisory Panel at Universiti Kebangsaan Malaysia and Universiti
Putra Malaysia and Industry Adviser at Universiti Tunku Abdul Rahman. He served
as President of the MIA (2005 to 2007 and 2009 to 2011) and as President of the
ASEAN Federation of Accountants from 2010 to 2011.

20 AEON CO. (M) BHD.

 Board of
Directors’ Profiles

Soichi
Okazaki

Non-Independent
Non-Executive Director

Japanese Aged 62 Male

Date of Appointment to the Board:

25 June 2020

Number of Board Meeting attended:

2/2
Board Committee(s):
• Nil

Academic/Professional Qualification:
• Faculty of Business Administration,
Toyo University

Directorship(s) in other Public Mr Soichi Okazaki has an illustrious 40-year career within the AEON group,
Companies/Listed Companies: ranging from executive to chairmanship serving in over three countries. He first
• Nil joined AEON Japan in March 1981 and 14 years later, he was Director at AEON
Guangdong Store, China for six years. In June 2001, he first stepped in Malaysia
to assume the posts of Director and President of AEON CO. (M) BHD. With
stellar leadership and dedication, he returned to his native country to become
Vice President of AEON Co., Ltd., and helmed AEON Supercenter Co. Ltd. as its
General Manager and President, successively in 2005. In 2009, he was Director
and General Manager of AEON Co., Ltd.’s Marketing and Planning Division.

In 2011 Mr Okazaki was promoted as Chief Executive Officer and President of

AEON Mall Co. Ltd., and concurrently served as Vice President and CEO, Shopping
Centre Development Business of AEON Co., Ltd. In 2015, he became CEO and
President of AEON Retail Co. Ltd while holding his directorship at AEON Mall. The
next five years saw further development within AEON ranks, where he presided
over Departmental Store business and International business. He was appointed
as the Chairman of AEON Retail Co. Ltd in March 2019 and currently also serves
as Executive Officer for AEON Co., Ltd.’s ASEAN Business.

ANNUAL REPORT 2020 21

corporate and Business oveRview

Board of
Directors’ Profiles

Chong
Swee Ying

Non-Independent
Non-Executive Director

Malaysian Aged 57 Female

Date of Appointment to the Board:

23 August 2018

Number of Board Meeting attended:

4/4
Board Committee(s):
• Nil

Academic/Professional Qualification:
• Tunku Abdul Rahman College, Kuala
Lumpur

Directorship(s) in other Public Ms Chong Swee Ying joined AEON CO. (M) BHD. as Administration staff in 1985.
Companies/Listed Companies: From 1985 to 2002 she was in-charge of various departments including Hardline
• Nil Merchandiser, Softline Group Leader, Leasing Manager and Senior Manager of
Shopping Centre Management. In 2003, she was appointed as General Manager
of Shopping Centre and New Business Development. She was appointed as
General Manager of Store Operations and Marketing in 2006.

In 2011, she was transferred and appointed as the Executive Director of AEON
Fantasy (Malaysia) Sdn Bhd. In 2012, she was promoted as the Managing Director
of AEON Fantasy (Malaysia) Sdn Bhd and retired from the same position on
1 June 2018. She was then appointed as Advisor to AEON Fantasy (Malaysia) Sdn
Bhd since July 2018.

Note: Save as disclosed in this annual report, all the Directors mentioned in pages 15 to 22 have no conflict of interest with AEON CO.
(M) BHD. or any family relationship with any Director and/or major shareholder or any convictions for offences within the past 5 years
and any public sanction or penalty imposed by the relevant regulatory bodies during the financial year, except for traffic summons,
if any.

22 AEON CO. (M) BHD.

 Senior
Management

1 2 3

4 5 6

7 8 9

ANNUAL REPORT 2020 23

corporate and Business oveRview

Senior
Management

AEON 3 SUNNY SETIAWAN

Chief Operating Officer
4 NOBUTADA HANAOKA
Chief Governance Officer

Leadership Indonesian Aged 56 Female Japanese Aged 48 Male

Council Date of Appointment: Date of Appointment:

12 March 2020 1 April 2020

Directorship(s) in other public Directorship(s) in other public

companies/listed companies: companies/listed companies:
• Nil • Nil

1 SHAFIE BIN SHAMSUDDIN Responsibilities: Responsibilities:

Managing Director/ • Managing AEON Retail Business • Overall management and operations
Chief Executive Officer Units (Departmental Store, Maxvalu, of Strategy, Legal, Non-Trade
Wellness and Daiso). Procurement, Quality Management,
• Managing AEON Mall Leasing, Risk Prevention and Mall Credit
Singaporean Aged 50 Male
Operations and Marketing. Control.
• Developing the operational • Responsible for regulatory and
Date of Appointment:
capability and strategy across the compliance across AEON.
1 January 2020
Retail and Mall.
Academic/Professional Qualification:
Academic/Professional Qualification: • International Study, Mt. Hood
His profile appears on page 16.
• Master Degree of Retailing, Community College, USA.
University of Stirling, Scotland, UK.
• Management Degree, University of Past Experience:
Tarumanegara, Indonesia. • Senior General Manager, AEON BiG
(M) Sdn Bhd.
2 TSUTOMU MOTOMURA Past Experience: • Leader, Accounting, AEON Ibis Co.,
Deputy Managing Director/ • Managing Director, CENTRAL Retail Ltd, Japan.
Executive Director Indonesia. • Accounting Executive, AEON Retail
• Chief Operating Officer, CENTRAL Co., Ltd, Japan.
Japanese Aged 52 Male Retail Vietnam.
• Director of Store Operations,
Date of Appointment: PT. Matahari Department store,
21 January 2021 Indonesia.
• National Retail Operations Manager,
Mitra Adi Perkasa, Indonesia.
His profile appears on page 17.

24 AEON CO. (M) BHD.

 Senior
Management

5 DR KASUMA SATRIA 6 Amanda Ho MIN CHIH 7 DJONI HERLAMBANG

Chief Human Resources Officer Chief Financial Officer Chief Technology Officer

Malaysian Aged 48 Male Malaysian Aged 48 Female Indonesian Aged 54 Male

Date of Appointment: Date of Appointment: Date of Appointment:

1 April 2020 1 April 2020 15 April 2020

Directorship(s) in other public Directorship(s) in other public Directorship(s) in other public

companies/listed companies: companies/listed companies: companies/listed companies:
• Nil • Nil • Nil

Responsibilities: Responsibilities: Responsibilities:

• Overall management and • To optimise the financial • Leading digital transformation.
operations of Human Resources, performance of the Company • Setting up AEON Kaizen Mobile-
Corporate Services and Corporate including its reporting, liquidity and Intelligence as a profit centric
Communications divisions. return on investment. business unit.
• Responsible for setting, executing • Overall management and operations • Approve purchases of technological
and operationalising AEON’s people, of Corporate Finance, Accounting, equipment and software.
business and branding strategies. Treasury and Finance Planning and • Designing and customising
Analysis (FP&A). technological systems and platforms
Academic/Professional Qualification: • Responsible for setting financial to improve customer experience.
• Doctorate, Multimedia University, strategy. • Analyse the costs, value and risks of
Malaysia. technology to advise management
• MBA, University of Huddersfield, UK. Academic/Professional Qualification: and suggest actions.
• Degree in Business Administration • Bachelor Degree in Accounting,
(Hons.), International Trade, University Kebangsaan Malaysia. Academic/Professional Qualification:
University Utara Malaysia. • Chartered Accountant, Malaysian • Master’s Degree in Information
Institute of Accounts (MIA). System, Indonesia.
Past Experience:
• General Manager, Education Past Experience: Past Experience:
Operations, LeapED Services • Chief Financial Officer, Chanel • More than 30 years’ experience in
(Khazanah Nasional wholly-owned Malaysia. retail industry specialising in digital
company). • Chief Financial Officer, Esthetics transformation.
• Director and Vice President, Sales International Group Berhad. • Held various senior management
& Business Development, Onshore • Variety of senior management positions leading the IT Divisions
& Offshore, Malaysia & Brunei, positions in other retail companies in several retail organisations
TechnipFMC. covering finance & accounting; IT, throughout Asia.
• Vice President, East Malaysia & inventory & logistics management,
Brunei, Technip. taxation & customer relationship
• Regional Vice President, management.
Human Resources & Corporate
Development, Asia Pacific, Technip.
• Group Vice President, Global
Sourcing & Recruitment, France,
Technip.

ANNUAL REPORT 2020 25

corporate and Business oveRview

Senior
Management

8 LEE BENG BENG 9 Azli Bin Mohamed

Note: Save as disclosed in this annual
Chief Property Officer Chief Entrepreneurial Commerce Officer
report, all the Senior Management
mentioned in pages 23 to 26 have no
conflict of interest with AEON CO. (M)
Malaysian Aged 51 Male Malaysian Aged 45 Male
BHD. or any family relationship with
any Director and/or major shareholder
Date of Appointment: Date of Appointment: or any convictions for offences within
12 March 2020 19 April 2021 the past 5 years and any public
sanction or penalty imposed by the
Directorship(s) in other public Directorship(s) in other public
companies/listed companies: companies/listed companies: relevant regulatory bodies during
• Nil • Malaysian Global Innovation & the financial year, except for traffic
Creativity Centre (MaGIC) Berhad summons, if any.

Responsibilities: Responsibilities:
• Overall strategy, planning and • Overall management and operations
management of the Property of E-Commerce ecosystem, platform
division. strategy and value chain from first-
• Responsible for developing the mile, mid-mile, and last-mile.
strategy, planning and setting • Responsible for the design and
directions for property and execution of Engine 2.0 P&L,
related scopes including business powering the Company towards the
development, retail planning, next level of growth.
concept & design and project
management.
Academic/Professional Qualification:
• Responsible for property
• Degree in Business Administration,
management, maintenance and
University Utara Malaysia.
operations of facilities of the
properties.
Past Experience:
Academic/Professional Qualification: • Chief Strategy & Growth Officer, Air
• Diploma in Business & Management, Asia Group, Malaysia.
Institute of Commercial • Chief Strategy Officer, Malaysia
Management, UK. Airports Holdings Berhad.
• Registered Property Manager • Variety of senior management
(PM0352) with Malaysian Board of positions in GE Malaysia & ASEAN.
Valuers, Appraisers, Estate Agents
and Property Managers (BOVAEA/
LPPEH).
• Certified Centre Manager (CCM) with
Persatuan Pengurusan Kompleks
Malaysia (PPKM).

Past Experience:
• Director of Retail at Malaysia Land
Properties Group, Malaysia.
• Director, Retail at OSK Property,
Malaysia.
• Head of Retail & Commercial at
Belleview Group, Malaysia.
• Various senior management
positions at shopping centres in
Belleview Group and Penas Group,
Malaysia.

26 AEON CO. (M) BHD.

 Management Discussion
and Analysis

Segmental revenue Dear Shareholders,

85% 15% OVERVIEW OF BUSINESS AND OPERATIONS

Introduction

Retailing Incorporated on 15 September 1984, AEON CO. (M) BHD. (“AEON” or the
“Company”) is a leading retailer in Malaysia and is regarded as one of the country’s
RM3.445 billion top Departmental Store for ease of Malaysian contextualisation, supermarkets
FY2019: RM3.832 billion and mall retail brands.

AEON is one of Malaysia’s largest mall operators with a total net lettable area
Property (“NLA”) of 1.6 million square metres.
Management
Services Since its inception, AEON has progressively grown to become a household retail
name with affordably priced, quality retail products and services as well as food
RM606.6 million and beverage.
FY2019: RM706.6 million
AEON is part of AEON Group of Companies and it is 51.68% owned by Japan
incorporated holding company, AEON Co., Ltd. The AEON Group of Companies
is an integrated Japanese retailer with over 300 consolidated subsidiaries and
affiliated companies. It has an active and growing presence across Japan, South
East Asia and China.

AEON
Group of
Malaysia

Retail & Property Financial Service Other Services Foundation

• AEON CO. (M) Bhd. • AEON Credit Service Berhad • AEON TopValu (M) Sdn Bhd • Malaysian AEON Foundation
• AEON BiG (M) Sdn Bhd • AEON Global Supply Chain Sdn Bhd
• AEON Fantasy (M) Sdn Bhd • AEON Delight (M) Sdn Bhd

ANNUAL REPORT 2020 27

corporate and Business oveRview

MANAGEMENT DISCUSSION
AND ANALYSIS

Business Model And Operations Following is AEON’s store composition as at 31 December 2020:

The Company’s principal business AEON’s 5 years mall trend as at 31 December

operations comprise the following:
Year 2016 2017 2018 2019 2020
Operation of a retail chain of Existing malls (beginning of the year) 24 26 26 27 28
departmental stores, supermarkets and Opened during the year 2 1 1 1 -
pharmacies, which sell a broad range Closed during the year - (1) - - -
of merchandise from clothing, food,
Number of malls as at year end 26 26 27 28 28
household products, pharmaceutical
products and other merchandise. - Number of malls fully owned
(including land) 14 14 14 14 14
In addition to these, AEON also operates - Number of malls fully leased
MaxValu standalone supermarkets (including land) 9 9 10 10 10
and health and beauty stores. AEON
- Number of malls only land is leased
is also the franchisee for Daiso flat
(but building is owned) 3 3 3 4 4
price shops. The MaxValu Prime or
AEON neighbourhood supermarkets,
Location of Operations
on an average scale range of 1,500 to
3,100 square metres each, provides
convenient shopping for residents
in the vicinity of where the outlet is
located.

The business model involves operations

of an anchor departmental store cum
supermarket that is complemented
by shopping mall operations and the
aforementioned specialty businesses
i.e. pharmacies, flat price shops and
others. In some instances, the Company
operates standalone neighbourhood
supermarkets and also departmental
stores cum supermarkets as an anchor
tenant in third party malls. In essence, AEON serves as a one-stop retail destination for urban and suburban
households to meet their daily living needs. Beyond AEON’s own merchandise,
its stores and malls also provide retail space for other retail brands to provide
a wide range of goods, services and entertainment, thus delivering a complete
lifestyle value proposition for shoppers.

AEON aims to provide an overall engaging shopping experience amidst a

convenient and conducive shopping environment, supported by a variety of
tenants, good facilities and services.

The Company also provides property management services for its malls. Under its
Property Management Services business model, AEON leases its mall space to
other retail brands and generates monthly rentals. It also undertakes facility
management and related services. The Company’s Property Management
Services segment also derives revenues from temporary rental of space for
events, seasonal promotions, revenues from car parks within its property
assets and more.

28 AEON CO. (M) BHD.

 MANAGEMENT DISCUSSION
AND ANALYSIS

PURPOSE AND PHILOSOPHIES cumulative effects of the MCO, loss of jobs and incomes and the heightened
fear among consumers to patronise public places, especially shopping malls and
AEON’s principles for its business supermarkets, had impacted retail sales.
operations and organisational culture
is centred on delivering sustainability However, FY2020, despite its many adversities also provided various catalytic
to its stakeholders by focusing on effects that accelerated the development of many positive industry trends.
three business purpose of 3Ps - This included a significant shift in retail consumption patterns as consumers
People, Planet and Peace. increasingly adopted digital mediums for their retail needs.

In realising this aspiration, AEON Retailers, in keeping up with consumers, have also moved into the digital
is further guided by six SDGs that marketspace. This includes small and medium sized retail businesses, looking to
empower AEON to create both establish an online brand presence and to remain relevant amidst a dynamic and
financial and non-financial values, fast-changing landscape.
which are realised through three
business philosophies of demand The rapidly evolving scenario presented AEON with new and exciting opportunities
chain business, snipering and for business growth. Tapping on technology, AEON has responded with speed
personalisation, and transparency in and agility to launch its New Retail Model, which comprises a complete end-to-
stakeholder communications. end customer journey that includes both offline and online shopping.

In the spirit of the name AEON, In addition, AEON has capitalised on the operating scenario in FY2020 to
which means eternity in Latin, the seek opportunities to rationalise its organisational structure and yield cost and
goal is to work together endlessly operational efficiencies. The new normal of FY2020 presented an impetus
with customers, suppliers, business for the Company to better understand customer demand, to target the right
partners, shareholders and the customer segments and develop more incisive customer insights towards better
community to create a future of limitless understanding consumption patterns and consumer behaviour.
promises. All this is encapsulated in
our business approaches of “Agile, Beyond commercial motivation, our strategic response was also driven by an
Genba and Entrepreneurial”. innate desire to help consumers during a most difficult period for many, and to
close the gaps within the present retail model.
For further information, please refer to
the Sustainability Statement section of In essence, the pandemic period has accelerated AEON’s various strategic
this annual report. initiatives to improve cost efficiencies, optimise operational productivity and to
grow its consumer reach via digitalisation and technology.
OPERATIONAL REVIEW
The various efforts taken have enabled the emergence of a more competitive,
FY2020 had begun on a positive note agile, robust and more consumer attuned AEON. The improvements made in
for Malaysia with the first two months FY2020 will place the Group on a stronger stead, which will ultimately translate
of the year recording positive gross into sustainable business and operational performance going forward.
domestic product (“GDP”) growth.
However, the unprecedented, global
Segmental Revenue And Earnings Analysis
COVID-19 pandemic begun to effect
the country, culminating with the Property Management
implementation of the Movement Retailing Services Total
Control Order (“MCO”) on 18 March
FY2020 FY2019 FY2020 FY2019 FY2020 FY2019
2020.
(RM’000) (RM’000) (RM’000) (RM’000) (RM’000) (RM’000)

The country’s GDP growth contracted Revenue 3,444,661 3,832,247 606,641 706,637 4,051,302 4,538,884
by 5.6%. The retail sector contracted
Segmental
by a significant 15.8%, much higher
Profit 77,863 114,616 229,620 268,799 307,483 383,415
than the initially anticipated 9.3%. The

ANNUAL REPORT 2020 29

corporate and Business oveRview

MANAGEMENT DISCUSSION
AND ANALYSIS

festivities that also tie in with year-end

sales promotions.

Revenue – Property Management

Services

AEON’s Property Management

Services segment registered revenue
of RM606.6 million, 14.2% lower year-
on-year (FY2019: RM706.6 million).
The revenue decrease was attributed
to lower occupancy rates as tenants
sought for non-renewal or early
termination of tenancy agreements
due the aforementioned COVID-19
pandemic.
Revenue Many consumers chose to defer large-
ticket purchases given the economic With less shoppers frequenting malls
For financial year ended 31 December scenario in FY2020. In particular, sales and supermarkets, rental commission
2020 (“FY2020”), AEON posted of household and furnishing items receivable and car park income
revenue of RM4.051 billion, 10.8% were deferred or cancelled. was lower in FY2020. Income from
lower compared to the previous temporary space rental was also lower
financial year’s RM4.539 billion. The above mentioned as well as other due to the lack of retail events and
Company topline performance was factors cumulatively led to decreased activities held during the financial year.
lower, attributed to reduced income retail spending across the entire
particularly from the retail business industry, with almost all retail players This was largely due to the
segment, which saw turnover decline experiencing a decline in topline implementation of MCO, which
by 10.1% year-on-year to stand at performance. prohibited such activities. Though
RM3.445 billion for FY2020 (FY2019: restrictions were eased with the
RM3.832 billion). Revenues and earnings were also transition to CMCO and consequently
impacted by the restrictions on RMCO, the lack of consumers
The drop in retail revenues were departmental store and specialty patronising malls served to
attributed to the COVID-19 pandemic, stores, which were not allowed to deincentivise retail brands and events
which its disruptive effects on the operate for almost two months during companies from holding experiential
global and local economy had the MCO period beginning from mid- events and promotions.
ultimately trickled down to impact March to early May.
consumer spending power. Profitability
Though the MCO was replaced
In FY2020, sales for hardline and with the less stringent Conditional On the back of lower revenues, AEON
softline products were lower by 20.8% Movement Control Order (“CMCO”) posted operating profit of RM259.3
and 37.4% respectively. Declining and subsequently Recovery Movement million, 27.7% lower than the preceding
revenues for the retail business Control Order (“RMCO”) in June 2020, financial year’s RM358.7 million.
segment were partially offset by a retail expenditure remained dampened
slight increase of 4.1% in revenues for the rest of the financial year. Profit before tax stood at RM101.8
generated from AEON’s foodline. million, 48.3% lower year-on-year
Retail sales improved in the third (FY2019: RM196.9 million), while profit
As mentioned earlier, consumers’ quarter of the year, only to come after tax for FY2020 stood at RM41.4
ability and appetite for goods and again under downward pressure with million (FY2019: 109.3 million).
services were inhibited by decreasing the reimplementation of CMCO and
incomes and a general fear or concern thereafter, MCO 2.0 in January 2021. Impacts to the profitability were
of patronising shopping malls and This was contrary to the usual strong partially offset by continued efforts to
retail centres, as well as a general retail sales performance customarily rebase operating, financial and other
apprehension of future prospects. seen every year due to year-end costs. These included migration to a

30 AEON CO. (M) BHD.

 MANAGEMENT DISCUSSION
AND ANALYSIS

shared service platform to consolidate retains a robust financial position to do Within the conventional retail space,
back-office operations across all so going forward. AEON looked to capture changing
AEON Malaysia retail as well as consumer demand as more consumers
consolidation of trade and non-trade The increase in receivables from chose to stay at home rather than to
procurement. debtors is due to accrual of debts patronise retail malls. With this, demand
arising from rentals owed by tenants patterns changed and opportunities in
In total, operating expenses (“OPEX”) to the Group. In FY2020, among the new categories emerged.
decreased in FY2020. The decrease assistance granted to tenants included
was attributed to AEON’s cost agile deferment of rental payments, AEON’s Personal Shopper Service was
structure, restructuring of its marketing which contributed to an increase in introduced to address the need of our
activities and a decline in business receivables. customers for grocery shopping during
development and operational activities the MCO. It provided customers with
undertaken in FY2020. Where possible, Capital Expenditure fast, efficient, safe and low-contact
(“CAPEX”) has been deferred or shopping. Starting with the elderlies
Retail Business earnings declined cancelled and with that, CAPEX for and physically-challenged customers in
by 32.1% to reach RM77.9 million FY2020 decreased by 83.1% to RM46.4 mind, it was very well received and soon
(before taxation and interest and other million (FY2019: RM274.2 million). This
expanded to all categories of shoppers.
expenses). On the back of reduced included deferred investments on new
rental collection, rental commission physical stores. Such investments will
In FY2020 demand for frozen and
receivable and car park income, profits be reviewed going into FY2021.
dairy products grew significantly.
for AEON’s Property Management
AEON was agile in adjusting to the
Services segment was lower by 14.6%, CAPEX has been redirected towards
changes to tap new opportunities.
year-on-year at RM229.6 million. refining and enhancing AEON’s New
For example, stores that were largely
Retail Model, into the Company’s
patronised by Malays were also
The Company’s past five years digitalisation journey and in developing
strong. Management made swift
performance, financial position and MaxValu stores.
financial indicators are shown on page changes to the product assortment
09 of this annual report. across all retail malls and outlets to
RETAIL SEGMENT cater to these changes in consumption
pattern and behaviour.
BALANCE SHEET Personalisation And Demand Chain
Delivering New Retail Experiences
Due to COVID-19, the Company has Management has been at the forefront
adopted a wide range of measures to of driving improvements across AEON. In FY2020, AEON has embarked on
mitigate the effects of the pandemic on These comprise of both incremental Kaizen Mobile Intelligence (“Ka-MI”),
business and financial performance. and transformation changes to the which is the Company’s strategic
business model, value chain and other approach to delivering an integrated,
AEON’s balance sheet remains healthy notable aspects of AEON’s operations. end-to-end retail value chain within a
with assets continuing to surpass single revolutionary ecosystem.
liabilities. Despite a decrease in
liquidity, AEON’s cash position remains
at sufficient levels, at RM71.4 million to
meet working capital requirements.
Borrowings continue to be addressed
and the Company has no new gearing
or debt other than those required to
meet working capital requirements.

The aforementioned decrease in

liquidity is due to the cumulative effect
of an increase in receivables coupled
with continued payouts to suppliers
and financiers. AEON has continued
to meet its financial obligations and

ANNUAL REPORT 2020 31

corporate and Business oveRview

MANAGEMENT DISCUSSION
AND ANALYSIS

Ka-MI serves as the enabler towards relationships with tenants as part of a safer shopping experience, greater
realising AEON’s aforementioned the business ecosystem and ultimately, brand outreach, increased market
aspirations of connecting the physical strengthen AEON’s digital retail reach, expansion and facilitates job creation.
retail business (offline assets) with the capabilities and offerings to entice
fast growing marketplace of digital customers. In essence, the aforementioned digital
retail (online solutions) as well as initiatives as well as others were rolled-
connecting back-end supply chains AEON’s ultimate goal is to create a one- out in tandem with the increased trend
and systems. stop, seamless customer experience among consumers to transition from
by tapping on our inherent strengths offline to online shopping platforms.
Leveraging on artificial intelligence and infrastructure, and leveraging on These online platforms were created to
(“AI”), machine learning and other the digital capabilities of Boxed and tap the growing number of tech-savvy
innovative technologies, one of Ka-MI’s Ka-Mi. consumers, as well consumers who
key objectives is the re-engineering of prefer digital, contactless shopping
the existing backend systems within In the future, all AEON services and over physical shopping.
AEON to ensure these are geared offerings will be integrated with
towards supporting AEON’s new machine learning capabilities to All digital platforms, while serving
business models. predict consumer buying behaviour, specific strategic purposes, are
recommend product selections, feed ultimately designed with the following
Through Ka-MI, AEON will bridge specific promotions and campaigns end goal in mind: to offer customers
the human elements of retail such and customise the retail experience seamless convenience and assurance
as consumer behaviour, spending based on personal preferences and of safety when purchasing from the
patterns and other intangible factors patterns. comfort of their homes.
with the technological aspects of
the business such as systems and This strengthens AEON’s value The use of these platforms also
processes to ensure the Company can proposition as it can offer a complete supports an enhanced shopping
effectively target the right consumers offline to online retail ecosystem convenience as when combined with
with the right the products and at the comprising products, sales channels, AEON’s delivery services, enables
most opportune moment. supply chain and logistics, as well as consumers to meet their consumption
payment gateway options and finance needs for a wide range of products
The Company has introduced multiple and communication. from the convenience of their homes
business models via Ka-MI such as or any other location, anytime. They
AEON to Customer (“A2C”), AEON Digital Highlights And Initiatives need not be hassled with travelling,
to Business (“A2B”), AEON to Partner parking and other concerns as goods
(“A2P”), AEON to Employee (“A2E”) In FY2020, AEON launched AEON are ordered online and delivered to
and AEON Care. Marketplace, AEON Virtual Mall, AEON their doorstep.
Fresh and AEON SG Cross Border and
In tandem with Ka-MI, AEON initiated the MyAEON super app to cater to All the online shopping channels are
various other digital initiatives in evolving consumer habits and to also supported by enhanced services such
FY2020. The strategic tie-up with provide enhanced customer service. as AEON Rider and AEON Personal
US-based Boxed to drive AEON’s The digital platforms effectively enable Shopper. The apps also allow for
expansion into New Retail Model
offerings is the first step of many more
planned strategic initiatives towards
realising this objective.

The Boxed technology and platform

will serve our customers and provide
technological solutions for AEON’s
New Retail Model. Among the many
capabilities of the platform, we will
be able to host AEON’s virtual mall
to enable closer business partnering

32 AEON CO. (M) BHD.

 MANAGEMENT DISCUSSION
AND ANALYSIS

products to be selected from the

nearest AEON outlet to the customers’
premises to ensure faster delivery. In
encouraging the use of these apps,
various, exclusive in-app promotions
were developed. These offers were
not applicable for in-store purchases.

One of the highlights in FY2020

was the soft launch of the MyAEON
super app. The super app acts as the
centralised platform that interconnects
several different platforms together
such as MyAEON Employees, MyAEON
Tenant Portal, MyAEON Suppliers and
others.

Beyond facilitating online purchases, tenants. The Mall provides consumers opportunities for suppliers and tenants
the super app comes replete with with a wide range of choices in retail to convert their inventory into cash and
an e-shopping list, parking locator, products and services, which are all support sales and cashflow.
e-recipe book, an online marketplace, just a click away and easily available
mall locations and a tenant directory. via the MyAEON super app. The Company also launched the AEON
626 Campaign at myaeon.com.my.
Under the MyAEON super app, The super app connects AEON to Through this campaign, consumers
tenants were provided complimentary customers and vice versa, and also have access to a large range of
marketing and promotional space to enables a wide range of retailers essential products, beauty, fashion,
showcase their products and services. including local small medium home decor, healthcare, footwear,
In essence, in supporting tenants, enterprises (“SMEs”) to gain access to electrical and digital items. The 626
AEON provided ample access to consumers. platform houses all AEON retail
various brands to reach consumers via brands, including Departmental Store,
the super app. As such, the Virtual Mall supports MaxValu Prime, Daiso, Wellness, and
suppliers, tenants and other business AEON BiG. The platform also houses
Going further, in FY2020, AEON partners who typically may not have AEON partners comprising AEON’s
launched its virtual mall platform the digital infrastructure or capabilities ecosystem of tenants and suppliers.
accessible via https://myaeon.com.my/. to reach prospective consumers.
The Virtual Mall is anchored by the Importantly, the mall helped to drive AEON is looking into the foodcourt
AEON brand and is complemented by sales for AEON and its ecosystem business model and with that, they
various local and international brands/ or tenants and retailers. It provided have launched a pilot digital foodcourt
at AEON BiG Wangsa Maju. The
foodcourt revolves around a novelty
concept where orders and payment
transactions are fully digital enabled.
This shortens queueing time and
minimises physical contact towards
ensuring improved social distancing.
The concept has been a success and
will be rolled out subsequently to more
AEON stores going forward.

With the imposition of border closures,

especially between Malaysia and
Singapore, a new approach was

ANNUAL REPORT 2020 33

corporate and Business oveRview

MANAGEMENT DISCUSSION
AND ANALYSIS

necessary to bring our brand and products to consumers across the Causeway.
Hence, the launch of AEON Cross Border Online.

Singapore customers accustomed to shopping at AEON malls and outlets in

Johor only need to log on to https://myaeon-sg.com/application to browse and
shop for items they desire. The platform is supported with a complete logistics
and fulfilment process, which ensures purchases are shipped and delivered on
time and in optimum condition to consumers.

Essentially, the virtual mall enables

suppliers, tenants and other business
partners who are not equipped with
the right digital capacity and capability
to be part of the AEON Ecosystem.

Additional support was provided

in the form of assisting tenants
to improve operational efficiency
via back-office support to expand
their marketing reach and brand
PROPERTY MANAGEMENT SERVICES visibility and essentially to improve
tenants’ business models to be more
Tenants/Businesses within AEON’s ecosystem experienced difficulties with most sustainable.
experiencing a minimum 20% drop in revenues and some as high as 50%. Tenants
were also facing a cash flow crunch which further exacerbated the situation. In adopting these measures, AEON
was able to retain many long-term
In response, AEON implemented various measures to ensure the majority of its tenants. In FY2020, the Company
affected tenants could continue to operate. This enabled AEON to arrest declining achieved an average occupancy rate
occupancy rates across all AEON properties. of 83.8% (FY2019: 85.7%)*.

Among these measures included rental waivers and discounts, flexible payment Other Highlights And Initiatives
schemes and other forms of financial and non-financial assistance. Assistance
was provided on a case-by-case basis in accordance to criteria as determined by Our adopted SDGs align financial
Management. and business performance to a triple
bottom-line line approach to enhance
The Company has chosen to adopt a longer-term perspective – to adopt a more value creation. It strengthens linkages
sustainable and strategic approach based on the proven track record of its many between financial aspects of our
tenants who have been excellent paymasters and attractive customer brands that operations with the aspirations of
have been effective in driving footfall at AEON’s malls. our stakeholders. It closes the gaps
between business perspectives with
However, beyond just providing financial assistance, AEON has extended its the dynamics of our target market and
online platforms to tenants; enabling them to participate in AEON’s virtual mall. the external operating environment.

* Annual Report FY2019 reported the occupancy rate of 90.7% based on the number of lots. In 2020, the Company changed the indicator
to be based on occupied Nett Lettable Area (NLA).

34 AEON CO. (M) BHD.

 MANAGEMENT DISCUSSION
AND ANALYSIS

The SDGs coupled with our collaboration in local movie production, Mak Cun. The telemovie was aired on
business philosophies guide our key local, terrestrial TV channel, TV3. The programme was developed to showcase
strategic pillars towards enabling a Malaysian made brands and products.
more integrated approach where
environmental, social and governance “Kempen Beli Barangan Malaysia” in collaboration with Ministry of Domestic
(“ESG”) matters are given due Trade and Consumer Affairs with the objective to penetrate local products into
recognition and oversight as with time, the mainstream retail sector was introduced in July 2020 and it is still ongoing at
ESG matters continue to increase in all AEON outlets nationwide.
terms of potential and actual impact to
business and financial performance. AWARDS AND ACCOLADES

Driven by this philosophy, AEON in In FY2020, AEON was awarded the Global Halal Excellence Awards 2020 for
collaboration with several government its continued efforts in providing Halal ready-to-eat food for customers and for
agencies embarked on AEON complying with MS1500:2009.
Prihatin, a programme which provided
opportunities to approximately 200
SMEs to operate at AEON malls to
generate income.

AEON Prihatin is in line with the with the

Government’s PENJANA (Pelan Jana
Semula Ekonomi Negara) initiative.
Seven AEON malls participated during
the campaign period which ran from
27 June to 30 September 2020. These
malls were AEON Mall Shah Alam,
AEON Mall Nilai, AEON Mall Seremban
2, AEON Alpha Angle Shopping Minister in the Prime Minister’s Department AEON Managing Director/Chief Executive
Centre, AEON Mall Rawang, AEON Datuk Seri Redzuan Yusof presenting the Officer, Encik Shafie Shamsuddin with the
Mall Kota Bharu and AEON Taman Global Halal Award to AEON Managing World Branding Awards trophy.
Director/Chief Executive Officer, Encik Shafie
Maluri Shopping Centre.
Shamsuddin.

The campaign saw AEON

providing floor space at the seven Being the recipient of this prestigious award further attests to AEON’s reputation
aforementioned malls for SMEs to as a credible company, who continues to provide consumers with the highest
open booths or stalls. The campaign quality products.
garnered RM2.4 million in sales,
despite its limited period. Despite the many challenges faced in FY2020, AEON has continued to uphold
its commitment to maintain benchmark standards as per regulatory requirements,
Similarly, AEON collaborated especially for food quality and safety.
with MARA to launch the MARA
Entrepreneur Kiosk (Warisan Hadirah). The Company is also honoured to have been acknowledged by the Inland
This was a single store initiative Revenue Board (“IRB”) as one of best taxpayers in FY2020. This is the second
undertaken at the AEON Bandaraya consecutive year that AEON has been selected. AEON is proud to be playing our
Melaka Store. The initiative provided role in contributing to the development of the nation through its tax contributions.
local SMEs with opportunities to
explore new business opportunities. Recently, AEON was selected to receive the World Branding Award in the Retailer-
Departmental Stores category. The World Branding Awards are organised by the
AEON’s highlight in supporting World Branding Forum, a global non-profit organisation dedicated to advancing
local brands and SME would be its branding standards.

ANNUAL REPORT 2020 35

corporate and Business oveRview

MANAGEMENT DISCUSSION
AND ANALYSIS

AEON was chosen from among 400 retail brands from 45 countries worldwide, a clear recognition of the Company’s
strong credibility as a trusted customer brand of choice. AEON was the only Malaysian brand to be selected in the Retailer-
Departmental Stores category.

AEON being honoured as one of the country’s Top Taxpayers in 2020 by the IRB.

COVID-19 PREVENTION MEASURES

The Management has been steadfast in developing and implementing government mandated SOPs to ensure a safe
operating environment, across all AEON assets. The Company recognises its employees notably for having played a pivotal
part through their strict discipline and adherence to SOP, which have enabled a high level of compliance.

Among measures implemented included physical distancing, employees rotation on a Team A and Team B basis, work-from-
home arrangements for all employees with the exception of retail frontliners, frequent screening and testing of employees
and regular disinfection and sanitisation exercises.

Face masks were provided to all employees as well as consumers across our malls, stores and outlets. Sanitisers were also
made readily available.

While COVID-19 related costs did contribute to OPEX, Management remains steadfast in ensuring a safe retail and work
environment for consumers and employees as well as other stakeholders. AEON will continue to adopt a safety-first approach
well into FY2021 to provide employees and patrons with the required assurance so they may feel comfortable and confident
in shopping with AEON.

Company’s Business Continuity Plan (“BCP”) and the Risk Register has been updated with the possibility of pandemics as a
risk factor going forward.

36 AEON CO. (M) BHD.

 MANAGEMENT DISCUSSION
AND ANALYSIS

Strategic Priorities And Future

Orientation

In essence, AEON will continue to

grow its New Retail ecosystem and
navigate the various challenges faced
by focussing on its five Key Strategic
Pillars.

The Pillars enable AEON to transition

successfully from its present business
model towards a new Retail Model
that is demand based and more
attuned to present market dynamics
and customer consumption patterns
and behaviours.

In enhancing Engine 1.0, the focus

OUTLOOK AND PROSPECTS
would be on improving experiential
offerings in malls and to expand our
Despite the continued effects of the COVID-19 pandemic on the global and
assortment. While the Company is
domestic economy, AEON maintains a positive outlook on growth prospects for
indeed developing its digital presence
the nation’s economy, the domestic retail sector and AEON.
and capabilities, it will continue
to focus on its brick and mortar
The introduction of vaccines, the various government stimulus measures and
operations. Capital expenditure in
other facilitating factors have restored a measure of confidence to both consumer
FY2021 will be centred on building
and investor sentiments.
the Company’s digital infrastructure
as well as improving its malls and in-
Economic growth in FY2021 is expected to revert to a positive trajectory, with
mall experiences for customers.
early estimates indicating gross domestic product (“GDP”) growth of 5.6% being a
possibility. Consistent with a pick-up in economic performance, the retail sector is
One of the key changes would be for
also expected to see improvement with conservative estimations of 4.1% growth
AEON’s mall operations to be more
for the full year.
demand driven in meeting customers’
changing preferences. In particular,
Retail sector growth will be driven by expansion in consumption demand,
the Company will look to increase its
underpinned by increased consumer confidence to consume a wide range
assortment and inventory of frozen,
of products and services. FY2021, notably in the second half of the year may
snacking and local products.
see a strong momentum as consumers transform pent-up demand into actual
propensity to transact.
People remains a pivotal factor
in AEON’s future growth plans.
Online shopping has seen increased consumer adoption in FY2020 across all
Empowering the workforce to be
consumer demographic groups. This trend is expected to gain further momentum
digitally savvy and financially astute
in FY2021. This will necessitate that retailers also dovetail with consumers’
is essential in enabling employees
changing consumption patterns.
to thrive amidst an evolving era
where technology is becoming more
The Government’s various initiatives to stimulate the economy should deliver
ingrained within work processes
a strong multiplier effect. In addition, further efforts to revive retail expenditure
and daily operations. Training will be
is required. This includes supporting job creation, which will restore disposable
supported by other aspects such as
incomes that will ultimately translate into higher consumer consumption.
variable incentive pay to reward and

ANNUAL REPORT 2020 37

corporate and Business oveRview

MANAGEMENT DISCUSSION
AND ANALYSIS

motivate employees to deliver high- driven, where strategic decisions are made based on real-time information
performance and to achieve Objective enabled through Big Data Analytics (“BDA”). BDA enables cost efficiencies and
Key Results (“OKRs”). a more strategic approach in driving decision making. It will also support faster
and more effective changes in product categories and assortment towards better
The Board and Management remain meeting customer demand.
passionate about continuing to
cultivate a conducive organisational The advantages that digitalisation of the business model provides is not limited
culture and work environment, to customers, but will also include AEON’s supply chain, thus ensuring vendors,
especially for the younger generation suppliers and tenants are included within the ecosystem. AEON shall adopt an
of today, who shall be AEON’s leaders inclusive approach as this is essential in ensuring that all stakeholders within
of tomorrow. AEON ecosystem are able to grow and progress together with the Company. The
goal is for our ecosystem of partners to also derive the benefits of technology and
Technology, digitalisation and to modernise their operations to remain relevant and competitive, which in turn
innovation will be gamechangers yields greater value to AEON.
for AEON going forward. Engine 2.0
entails greater expansion into the high- The impact of COVID-19, though severe, is with all likelihood to be a temporary blip
potential e-commerce industry, and the to the global and domestic economy as well as consumer consumption patterns.
further development of AEON’s digital With an effective vaccination programme at the fore of the government’s efforts to
marketplace. In addition, through its permanently resolve the pandemic issue, it is likely that going forward, consumer
digitalisation journey, the Company confidence will be significantly restored and with that, a dual consumption pattern
will further explore how to create more comprising both conventional and online spending will emerge.
opportunities for the gig economy,
which is a fast-growing segment in AEON continues to ready itself for this scenario, while implementing its strategies
today’s economic landscape. to remain relevant and robust during the pandemic period. On the back of hard-
won efficiencies, improved productivity and new offerings based on digitalisation
In supporting our technological and innovation, the Board and Management are optimistic of an improved
ambitions, AEON will be more data business and financial performance in FY2021.

38 AEON CO. (M) BHD.

 MANAGEMENT DISCUSSION
AND ANALYSIS

PRODUCTS & DIVIDEND

SERVICES
On 24 June 2020, an ordinary dividend
of 4.00 sen per share amounting to
RM56.2 million was approved by the
Company’s shareholders at the 35th
Annual General Meeting and was duly
paid out to shareholders on 30 July
2020.

Having taken into consideration the

Company’s financial performance,
PEOPLE expected operating conditions for
FY2021 and the Company’s capital
requirements going forward, the
planet Board has recommended an ordinary
COMMUNICATIONS SALES
CHANNELS dividend of 1.50 sen per share in
peace respect of FY2020, subject to
shareholders’ approval at the
forthcoming AGM to be held on
23 June 2021.

Total net dividend payable amounts to

RM21.1 million.

AEON remains committed to its

PAYMENTS LOGISTICS & objective of creating value for all
SUPPLY CHAIN stakeholders as per its business
purpose of People, Planet and Peace.
We will continue to drive forward with
the goal of creating shared prosperity
and to reward our loyal shareholders,
Dividend table 2016 2017 2018 2019 2020
over the short, medium and long-term
Net dividend (RM’000) 42,120 56,160 56,160 56,160 21,060 horizons. In doing so, Management
Net dividend per share strives to deliver both financial and
(sen) 3.00 4.00 4.00 4.00 1.50 non-financial value creation that will
sustain AEON well into the future.
Payout ratio (%) *46.3% 53.5% 53.4% 51.4% 50.8%

Note:
Thank you.
* 2016 has been restated upon adoption of Amendments to MFRS 127, Equity Method in
Separate Financial Statement.
Shafie bin Shamsuddin
Managing Director/Chief Executive
Officer

ANNUAL REPORT 2020 39

corporate and Business oveRview

EVENT
HIGHLIGHTS

january

An Evening of Appreciation
with Mr Shinobu Washizawa
16 January 2020 – A high-tea event was organised at
AEON Taman Maluri’s Shinobu Garden to bid a fond farewell
to Mr Shinobu Washizawa and to convey the Company’s
appreciation for his 40 years of service with the AEON
Group of Companies.

AEON Mesra
Chinese New Year 2020
17 January 2020 – AEON through the Malaysian AEON
Foundation hosted underprivileged children in conjunction
with Chinese New Year celebration. RM93,149 was donated
during this event with each child given the opportunity to
shop for clothes and gifts at AEON and AEON BiG stores.

40 AEON CO. (M) BHD.

 EVENT
HIGHLIGHTS

february

AEON Clean and Green

19 February 2020 – Under ‘Clean and Green Campaign’,

volunteers from AEON Bandar Utama led 105 students
Pelajar Pendidikan Khas Integrasi from Sekolah Kebangsaan
Taman Tun Dr Ismail 2 to plant 500 herbal plants. AEON’s
volunteers also repaired several facilities in the school.

april

COVID-19 Ops Relief

7 April 2020 – The “We Care, We Share” initiative was organised in appreciation of healthcare frontliners for their tireless
efforts in combatting COVID-19. The total donation sum came to RM167,708, comprising 2,000 homecare boxes of dry food
and essential items (i.e. sanitisers, toothpastes and shower creams), 300 foldable chairs and 7,800 dinner packs, which were
provided to Hospital Kuala Lumpur.

ANNUAL REPORT 2020 41

corporate and Business oveRview

EVENT
HIGHLIGHTS

may

AEON Mesra Ramadan 2020

23 May 2020 – In conjunction with the holy month of

Ramadan and Hari Raya Aidilfitri, AEON Group employees
(AEON Co., AEON BiG and AEON Credit Service)
collaborated with various NGOs to donate RM300 each to
728 single parents and deserving families nationwide.

june

AEON 626 Introduction

18 June 2020 – AEON’s first digital Offline to Online

shopping platform (‘O2O’) was launched by Minister of
Domestic Trade and Consumer Affairs, YB Datuk Alexander
Nanta Linggi.

O2O, as a virtual mall, houses all brands across AEON Retail

as well as brands from the AEON’s tenants and suppliers.

AEON 35th Annual General

Meeting
24 June 2020 – The 35th Annual General Meeting was
conducted virtually via Zoom application for the first time. The
Board of Directors maintained an effective communication
with the shareholders despite the pandemic.

ProgramME PRIHATIN AEON Bersama PKS

June to September 2020 – In line with Government’s PENJANA (Pelan Jana Semula Ekonomi Negara), AEON provided
physical, in-store space and supporting structures to enable Small Medium Enterprises (“SMEs”) to sell their products at
seven participating AEON Malls.

42 AEON CO. (M) BHD.

 EVENT
HIGHLIGHTS

august

Berkat Ramadan - AEON Bersamamu

6 August 2020 – “Berkat Ramadan - AEON Bersamamu” campaign saw RM1.4 million collected which was used to
purchase 300 motorcycles. Through this programme, some of those who lost their jobs due to COVID-19 were recruited as
AEON Delivery Riders.

Sambutan Hari Konservasi Harimau DAN Gajah Peringkat

Kebangsaan 2020

8 August 2020 – In conjunction with Global Tiger Day and World Elephant Day, AEON handed over RM97,285.50 in
proceeds from the sale of 24,945 “Love our Forests, Save our Malaysian Tigers” reusable bags to the Ministry of Energy and
Natural Resources.

AEON Berkat Korban 2020

10 August 2020 – In conjunction with Hari Raya Aidiladha,

in compliance to strict COVID-19 SOPs, AEON donated seven
cows for meat, which was distributed to fifteen children
charity homes in the Klang Valley. The process was done by
enabling orders through the web and in collaboration with
NGOs.

ANNUAL REPORT 2020 43

corporate and Business oveRview

EVENT
HIGHLIGHTS

august

Kita Merdeka Telemovie

10 August to 16 September 2020 – In conjunction with Malaysia’s 63rd

National Day celebration, AEON collaborated with creative partners to produce a
telemovie titled “Kita Merdeka”. It was done in appreciation and recognition of the
frontliners (employees and suppliers) who have greatly sacrificed their time and
efforts, and remained resilient in dealing with the challenges amidst the COVID-19
outbreak. “Kita Merdeka’ telemovie was aired via TV3, RTM and Astro RIA, and
garnered viewership of more than RM1.6 million nationwide.

september

AEON Home ground

Mak Cun Anjung Orang Kita
Re-opening
1 September to 31 December 2020 – The 3 September 2020 – The newly-renovated AEON
collaboration saw Mak Cun Jutawan Sdn Bhd act as an Home Ground located on the third floor of AEON
anchor supplier which gathered other SMEs to market STYLE in Taman Maluri, Kuala Lumpur was officially
their products at AEON and AEON BiG stores. A telemovie opened and was well received by the employees. The
of this initiative titled Mak Cun Anjung Orang Kita was also refreshing ambience of the Home Ground is dedicated to
produced and was aired via TV3 on 25 October 2020 collaboration, creativity and agility.
reaching 1.6 million viewership.

44 AEON CO. (M) BHD.

 EVENT
HIGHLIGHTS

september

Opening of Shop Lot by Muda AgriculturAL Development Authority

(MADA)

11 September 2020 to 31 January 2021 – As part of our collaboration with Government Agencies to help SMEs generate
income during the MCO and CMCO period, AEON offered a tenant lot at the Ground Floor of AEON Mall Shah Alam to Muda
Agricultural Development Authority (MADA) to sell and create awareness of SME products from Kedah and Perlis.

Karnival Bumi Kenyalang DAN

Kempen Beli Barangan Buatan
Malaysia
14 to 30 September 2020 – In collaboration with the
Ministry of Domestic Trade and Consumer Affairs (MDTCA)
and Ministry of Industry, Industry Terminal and Entrepreneur
Development Sarawak (MINTRED). AEON held a two-week
sales campaign at AEON Mall Nilai to highlight products and
services from Sarawak entrepreneurs.

AEON
36th Anniversary Celebration
24 September to 15 November 2020 – In conjunction
with AEON’s 36th anniversary in Malaysia, “AEON Di Hatiku”
campaign was organised to express our gratitude to all
employees and other stakeholders who have worked
tirelessly in serving the community amidst the pandemic.

ANNUAL REPORT 2020 45

corporate and Business oveRview

EVENT
HIGHLIGHTS

october

LAUNCHING of AEON’s FIRST DIGITAL FOOD HALL

12 October 2020 – In advancing its digitalisation aspiration, AEON launched its first digital food hall at the re-opening
of the MidTown Food Hall at AEON BiG Wangsa Maju. The digitalised method of ordering and purchasing using QR code
reduces queueing time and minimises physical interaction. The event also highlighted that more local products are being
served at the new food hall and will also be rolled out to other AEON outlets.

november

Flood Relief
Operations 2020
(Seremban and
Hulu Langat)
8 and 15 November 2020 – AEON
distributed goods and essential daily
items worth RM16,813 to 265 families
affected by the floods at Kampung
Batu 3 (Seremban, Negeri Sembilan)
and Kampung Sungai Serai (Hulu
Langat, Selangor).

AEON Mesra Deepavali 2020

18 November 2020 – AEON donated over RM128,700 to 429 single parents

and deserving families nationwide, with each family receiving RM300 in their
AEON Member Plus Card to help ease their burdens in celebrating the Festival
of Lights.

46 AEON CO. (M) BHD.

 EVENT
HIGHLIGHTS

december

Opening MARA Entrepreneur

Kiosk (Warisan Hadirah)
Ongoing since 15 December 2020 – AEON collaborated
with Majlis Amanah Rakyat (MARA) to expose and familiarise
Warisan Hadirah, SME entrepreneurs under MARA, to new
business opportunities and orientations by offering a kiosk
located in front of AEON Supermarket in AEON Bandaraya
Melaka Store to help them expand their business.

AEON Mesra
Christmas 2020
17 December 2020 – the AEON Mesra Christmas event
saw 523 underprivileged children from various charity
homes having their wish list granted by AEON. A total of
RM92,149 worth of gifts from AEON and AEON BiG stores
were distributed to the children.

AEON
Youth Leaders 2020
17 to 19 December 2020 – Organised by AEON 1% Club
Foundation, the AEON Youth Leaders 2020’s forum was held
online via Zoom. The event saw 72 youth leaders from over
nine countries participating, including two from Malaysia
with the goal of developing the world’s future generation
of leaders.

ANNUAL REPORT 2020 47