FGV expects better results this year by being more efficient

Dato Zakaria Arshad during the media briefing on FGV's 1st Quarter Results.. . -- M. Azhar Arif/The Star 24 May 2016

KUALA LUMPUR: Felda Global Ventures Holdings Bhd (FGV) sank into a loss in the first quarter (Q1) of this year, but group president and CEO Datuk Zakaria Arshad expressed confidence that the group’s full-year 2016 financial results will be an improvement over last year’s.

This is given FGV’s current focus on improving the efficiency of its core assets and putting on hold merger and acquisition (M&A) activities.

“I’m looking at improving FGV’s bottom line. We can have cost savings of up to RM100mil via our immediate initiative plans.

“Without the M&As, we can even save about RM60mil to RM70mil and other austerity drives about RM20mil or so,” he told a media briefing on Tuesday to announce FGV’s results for the quarter ended March 31. (For the story on FGV’s results, click here.)

Zakaria said FGV would also be looking at “sweating” the assets of its new plantations, Asian Plantation Ltd, Pontian United Plantations Bhd and Golden Land Bhd together with its other existing plantations.

“We want to improve the yields in our estates,” he said, adding that the group’s palm tree age profile was “getting better and younger” via active replanting of 15,000ha per year.

Previously, about 70% of FGV total estates have aging palm trees of 25 years and above.

Now, the group’s average palm tree age profile is 15.8 years (excluding Golden Land estates).

By 2020, the group’s palm tree age profile is expected to be 12.7 years and can generate better fresh fruit bunches yields, he said.