PPB Group Bhd is confident its 2003 group pre-tax profit will match the RM508.9mil achieved last year, executive chairman Ong Ie Cheong said yesterday.
With the measures taken to capitalise on our profitable core businesses and enhance profit margins, the group is well positioned to sustain its profit growth, he told reporters after the group AGM.
He said the 2002 showing was 58.2% increase over the 2001 profit of RM321.6mil, attributing the substantial improvement to higher profit contributions from plantations, commodity trading, flour and animal feed activities and property development.
Year-on-year, revenue for 2002 was up 39.6% to RM7.858bil from RM5.629bil, due mostly to higher palm products production and prices.
Ong said oil palm plantation operations, one of the group's core businesses, was undertaken by 55.8% subsidiary PPB Oil Palms Bhd (PPBOP), which performed well in 2002 with a 3.6-fold increase in pre-tax profit to RM168.6mil.
Ong said sugar refining operations continued to be an important contributor to group profits, although its contribution in 2002 was lower compared with the previous year's due to reduced refining margins and intense competition.
Nevertheless, the group managed to maintain domestic sales at 60% of the market and increase export sales by almost 50%, which helped improve performance.
The cinema operations, Ong said, had returned to profitability and recorded an operating profit of RM3.6mil.
He said Golden Screen Cinemas was expanding its cinema operations to Penang, investing RM15mil to set up a 12-screen cineplex with 1,856 seats at Gurney Plaza, scheduled for completion by end 2003.
As for property development, Ong said PBB's wholly-owned subsidiary, PPB Binaharta Sdn Bhd, planned to develop its remaining land bank of eight hectare in Bukit Segar in Cheras, Kuala Lumpur, into exclusive bungalow units, scheduled for launch next year.
PPB Binaharta is also looking at developing some of the group's commercial land bank, like New World Park and Tanah Aman in Penang.
Ong disclosed that the group had aimed to build and manage a sewerage plant in Beijing, but the almost concluded negotiations had to be postponed due to the outbreak of Severe Acute Respiratory Syndrome (SARS).
He said that the group would resume negotiations once the outbreak was contained. Bernama