MARKET DEVELOPMENT
FGV Eyes 20 Per Cent Profit Contribution From Pontian For FY14
FGV Eyes 20 Per Cent Profit Contribution From Pontian For FY14
03/04/2014 (Bernama) - Pontian United Plantations Bhd (PUP), the latest acquired subsidiary of Felda Global Ventures Holdings Bhd (FGV), is expected to contribute 20 per cent to the group's profit for the financial year ending Dec 31, 2014 (FY14).
Speaking to reporters at the PUP familiarisation trip here today, FGV Group President and Chief Executive Officer, Mohd Emir Mavani Abdullah, said PUP was FGV's first acquisition after its listing and was considered as a strategic move.
He said PUP had made a significant contribution to the group's performance in the last quarter of FY13 and was expected to make full contribution this year as it is now a fully counted asset of FGV.
"The acquisition of PUP is one of the best deals last year, the market price has gone up to RM55,000 per acre this year, and apart from that, it comes with facilities like mills, kernel crushing plant, a quarry which has more than 100 years of life and also good infrastructure," Mohd Emir said.
FGV is said to have paid about RM34,000 per acre for the plantation.
He said the quarry, which is located within the PUP estate, was capable of contributing about 90 per cent profit margin if commercialised, however, it is current mainly used in the estate and was able to lower the infrastructure cost tremendously.
Mohd Emir also said that the PUP acquisition also came with a cash balance of RM250 million and zero debt, in addition to a pool of talent and highly-skilled management.
PUP was fully acquired on Oct 30, 2013 and the exercise cost FGV RM1.2 billion, with the main assets being mature oil palm land spanning more than 16,000 hectares.
It also comes with mills, which has the capacity of 90 metric tonnes per hour and its estates in Sabah can produce about 80,000 metric tonnes of crude palm oil and 17,000 metric tonnes of palm kernel per annum.
"The acquisition has given synergy to the operations as one big family whereby Pontian can now facilitate on logistics and efficiency of operations as its land is close to Felda Sahabat estates and FGV's refinery in Lahad Datu.
"Pontian can also leverage FGV's world class research and development and business operating procedures to improve its production and operation," Mohd Emir added.
Speaking to reporters at the PUP familiarisation trip here today, FGV Group President and Chief Executive Officer, Mohd Emir Mavani Abdullah, said PUP was FGV's first acquisition after its listing and was considered as a strategic move.
He said PUP had made a significant contribution to the group's performance in the last quarter of FY13 and was expected to make full contribution this year as it is now a fully counted asset of FGV.
"The acquisition of PUP is one of the best deals last year, the market price has gone up to RM55,000 per acre this year, and apart from that, it comes with facilities like mills, kernel crushing plant, a quarry which has more than 100 years of life and also good infrastructure," Mohd Emir said.
FGV is said to have paid about RM34,000 per acre for the plantation.
He said the quarry, which is located within the PUP estate, was capable of contributing about 90 per cent profit margin if commercialised, however, it is current mainly used in the estate and was able to lower the infrastructure cost tremendously.
Mohd Emir also said that the PUP acquisition also came with a cash balance of RM250 million and zero debt, in addition to a pool of talent and highly-skilled management.
PUP was fully acquired on Oct 30, 2013 and the exercise cost FGV RM1.2 billion, with the main assets being mature oil palm land spanning more than 16,000 hectares.
It also comes with mills, which has the capacity of 90 metric tonnes per hour and its estates in Sabah can produce about 80,000 metric tonnes of crude palm oil and 17,000 metric tonnes of palm kernel per annum.
"The acquisition has given synergy to the operations as one big family whereby Pontian can now facilitate on logistics and efficiency of operations as its land is close to Felda Sahabat estates and FGV's refinery in Lahad Datu.
"Pontian can also leverage FGV's world class research and development and business operating procedures to improve its production and operation," Mohd Emir added.