KUCHING: Strong export prices for Malaysian hardwood plywood has given a major lift to the earnings of Ta Ann Holdings Bhd
’s timber business.
In the 12 months to December 2022,Ta Ann recorded a 35% jump in the average selling price of its plywood products, with the bulk of the exports going to Japan.
This surge in export price boosted Ta Ann’s timber products’ segment pre-tax profit by several folds to RM77.5mil on a revenue of RM371.2mil in financial year 2022 (FY22) from RM17.5mil on a revenue of RM316.1mil in FY21, according to the company’s yearly financial results released recently.
With the full certification of its forest management units covering about 345,000ha in 2020, Ta Ann has been producing 100% Programme for the Endorsement of Forest Certification (PEFC)-certified plywood products.
According to Ta Ann group managing director Datuk Wong Kuo Hea, the PEFC-products command a strong selling point in the Japanese market, especially after the Tokyo metropolitian government and some Japanese developers formally decided to use only certified materials for their projects in 2020.
In 2021, Ta Ann sold 86,529 cu m of plywood, of which 90% was to the Japanese market.
Ta Ann group has plywood manufacturing operations in Sarawak and Tasmania, Australia, the latter’s production of which is for sales in the domestic market.
Due to the inability to secure suitable skilled workers and to maintain a stable labour force as well as the reduction of contractual logs supply volume which resulted in lower productivity of the Tasmanian Smithton mill, Ta Ann had recognised an asset impairment of RM16.23mil and derecognition of deferred tax asset of RM7.94mil (total: RM24.17mil) for FY22.
The firmer plywood export price had enabled Sarawak to earn about RM2.12bil (free on board value) in foreign exchange from this top timber product in 2022 (2021: RM2.15bil) despite a sharp decline in the volume exported to 726,247 cu m from 987,694 cu m or a reduction of 261,447 cu m or by more than 26%, according to yearly export figures from Sarawak Timber Industry Development Corp.
