ULU TIRAM: Kulim (M) Bhd is allocating RM178mil for capital expenditure (capex) for its plantation operations in Malaysia, Papua New Guinea (PNG) and the Solomon Islands this year and RM3mil for its natural oleochemicals operations in Pasir Gudang.
Managing director Ahamad Mohamad said the allocation would be used for related activities such as planting and replanting programmes and operating expenditure.
He said the activities in Malaysia would mostly involve the replanting of old oil palm trees at Kulim’s plantations in Johor while in PNG and the Solomon Islands it would be planting.
“The prospects of the oil palm plantation business in PNG and the Solomon Islands are good as there are still large tracts of land available for new plantation areas,” Ahamad told StarBizWeek.
Ahamad, who is also president of the Johor Football Club (Johor FC), said this at the Johor FC AGM and the introduction of the team’s new players for the 2010 Super League season.
Kulim currently has some 84,000ha planted with oil palm in Malaysia, PNG and the Solomon Islands – 36,000ha in Malaysia, 42,000ha in PNG and 6,000ha in the Solomon Islands – and has six mills in PNG and one in the Solomon Islands.
The PNG and Solomon Islands operations provide some 8,500 and 3,200 employment opportunities respectively. In PNG, smallholders with 26,000ha of planted areas sell their fresh fruit bunches to Kulim subsidiary, New Britain Palm Oil Ltd (NBPOL).
Ahamad said the company still had some 30,000ha in PNG that were yet to be planted with oil palm and on average, it planned to plant 3,000ha annually.
He said that apart from the 42,000ha oil palm plantation in PNG, the company also had 11,000ha planted with sugarcane, producing sugar for domestic consumption.
“We have no immediate plan to replace the sugarcane with oil palm trees in view of the good price of sugar in the global market,” he said.
Ahamad said unlike in Malaysia, palm oil in PNG and the Solomon Islands received the Pacific Premium and PNG Premium, where the commodity fetched better prices in the European markets.
He said the company had targeted to obtain the Roundtable on Sustainable Palm Oil certification (RSOP) for its Solomon Islands operations this year after a similar certification was given to its Malaysian and NBPOL operations.
Ahamad said Kulim, which currently also manages some 24,000ha of Johor Corp’s oil palm plantations in Johor, was also in the midst of getting the RSOP certification for them.
He said the company would also allocate RM200mil in capex for KFC Holdings (M) Bhd (KFCH) and QSR Brands Bhd to open new KFC and Pizza Hut restaurants and RM90mil in capex for Sindora Bhd’s Intrapreneur Venture Business scheme this year.
KFCH plans to open 30 new outlets in Malaysia, 10 in India and five in Singapore while QSR is looking at 17 new restaurants in Malaysia.
Kulim has about 62% stake in QSR which in turn has a 50.2% equity in KFCH. Kulim owns 76% of Sindora.
KULIM : [Stock Watch] [News]
Did you find this article insightful?