Auditor-General says RM49.88m debt weighing down Felda-owned Grand Borneo in 2021, partly due to pandemic
PUTRAJAYA, Feb 16 — Grand Borneo Sdn Bhd, which was set up to run Felda’s hotels and resorts in the country, accumulated RM49.88 million in losses in 2021 — in part due to the Covid-19 pandemic.
This finding was disclosed in the 2021 Auditor-General’s Report Series 2 released today.
The national audit report found that the six hotels and resorts managed by Grand Borneo — Felda Residence Sahabat, Felda Residence Hot Springs, Felda Residence Kuala Terengganu, Felda Residence Team and Felda Residence Tanjung Leman as well as Grand Borneo Hotel Kota Kinabalu — recorded 42.9 and 67.5 per cent room occupancy rates in 2020 and 2021 respectively.
Its revenue for the two pandemic years fell short of the original targets, coming in at 32.4 per cent and 74.1 per cent respectively.
“Overall, the objective of establishing Grand Borneo to manage FR Group Resorts has not been fully achieved, corporate governance practices are less than satisfactory and the financial position is less stable.
“Grand Borneo has also not yet been able to generate profit for the period from 2019 to 2020. This is due to factors beyond Grand Borneo’s control following the effects of the Covid-19 pandemic and the Movement Control Order in 2020 which has affected the management of planned activities,” the A-G said in the report.
The A-G also noted that Grand Borneo had poor management.
The RM4.09 million meant for the upkeep of its hotels and resorts was not paid out until July 2021.
It did not service its RM670,000 in debts until after 120 days later, adding another RM225,626 to the amount.
The A-G recommended that Grand Borneo needs to aggressively promote and market its hotels and resorts and use the money it has been budgeted to do so.
“Efforts to attract more visitors need to be improved by taking into account the attractions or tourism products of local people around the resort,” the A-G said in the report.
It also recommended the company seek more funds from Felda for the upkeep of its facilities and equipment.
“The maintenance, replacement and repair of damaged assets must be carried out immediately so that accommodation rooms and facilities can be used optimally to increase the company’s income and provide comfort to visitors,” the A-G said.
