Tuesday, July 2, 2002 - KUMPULAN Guthrie Bhd has defended its decision tostake its future in Indonesia as the kind of forward thinking that couldwell double its earnings per share (EPS) in the near future.Its group chief executive officer Tan Sri Abdul Khalid Ibrahimacknowledged that there were investors and shareholders who still viewedthe company’s foray into Indonesia as a folly that had ramped up itsgearing to 1.19 as at March 31.He said it had taken a while for the group to get its 200,000ha Minamasplantations – for which it paid RM1.4bil – into order, but gave anassurance that things were now in order; and should crude palm oil (CPO)prices hold around the US$350 to US$400 level, “Guthrie is poised for avery successful time’’.Khalid said the best EPS the company achieved in the past five yearsamounted to 20.3 sen, in 1997.“With the acquisition (of Minamas), we can target to achieve a two-foldincrease in EPS,’’ he told a briefing for analysts at the group’s officein Bukit Jelutong yesterday,Khalid also pointed out that the contribution from the group’s Indonesianoperations had turned around from a loss of RM37mil in the nine months in2001, to a profit of RM10mil for the first quarter of the year.Guthrie, he said, was now working to accelerate its total crude palm oil(CPO) production to one million tonnes annually from about 500,000 tonnesat present, with the Minamas plantations to contribute about two thirds ofoutput.However, Guthrie, which already has 11 mills in Indonesia, would have toinvest quite considerably in an additional eight to 10 mills over the nextfour to five years to meet its refining needs.But prior to that, it is committed to addressing its total borrowings ofRM2.88bil as at end-March.Khalid said that Guthrie was taking the necessary steps to reduce itsloans to RM2.39bil by the end of 2004, through a programmed disposal ofhigh value properties, such as its recent sale of the Haron Estates toGolden Hope Plantations Bhd for RM565mil, and the proposed sale of a 10%equity in Minamas for US$45mil to US$50mil, plus the sale of Group Acompanies shares for around the same price.(The informations and opinions expressed in this article represent theviews of the author only. They should not be seen as necessarilyreflecting the views of Palm News)