Timber sales brought down by yen


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  • Tuesday, 19 Feb 2013

KUCHING: The weakened Japanese yen has been blamed for the poor demand for Malaysian timber products from Japanese importers.

According to timber firm Lingui Developments Bhd, demand for plywood and veneer from Japan in the fourth quarter last year remained generally lacklustre partly due to the weakened Yen.

During the six-month period to Dec 31 last year, Lingui sold 134,997 cu m of plywood and 70,047 cu m of veneer at an average price of RM1,615 per cu m and RM1,054 per cu m respectively.

Sales of the two timber products contributed 36% to the group’s total revenue of RM451.4mil for the second quarter ended Dec 31 last year, and 35% to the group’s turnover for financial year-to-date, Lingui said in a review of its latest financial results.

For the quarter under review, Lingui group recorded a pre-tax loss of RM13.32mil from a pre-tax profit of RM50.9mil a year ago.

Group revenue fell from RM496.9mil. Loss per share was 1.53 sen against earning per share of 6.82 sen during the same period.

The company attributed the losses to changes in fair value of biological assets of an associate involved in oil palm plantation of RM13.2mil.

Lingui said the logs segments contributed 32% to the group’s revenue during the latest quarter.

“Despite the continued slower growth in the emerging markets, namely China and India, the logs segment contributed an operating profit (before changes in fair value of biological assets less estimated point-of-sale costs) of RM11.6mil and RM19.6mil during the financial quarter under review and financial year-to-date respectively.

“For the financial year-to-date, the group sold 317,215 cu m of hardwood logs and 385,596 cu m of softwood logs and average prices achieved were RM461 per cu m and RM320 per cu m respectively,” it added.

Lingui group is involved in logging operations in Sarawak and it owns forest plantations in New Zealand, which produces softwood logs for export.

Lingui said despite higher revenue recorded by upstream support from external sales during the quarter under review, the rising diesel prices and spare part costs had impacted its operating costs.

Going forward, Lingui said Japan’s economy was expected to slow down, giving the phasing out of private consumption incentives combined with a new measure of increasing taxes on consumption, anticipated reductions in pension benefits and government spending cuts.

It said the economies in developing countries had weakened considerably last year as the region’s growth engines — China and India — both shifted to lower gear.

The sovereign debt crisis and economic recession in the Eurozone remain a serious threat to the world economy, it said, adding that the outlook for US economy remained fragile as its government continued to address its rising debt ceiling issue.

Meanwhile, Lingui shares would be suspended from trading today to facilitate the implementation of a privatisation scheme by Hong Kong-listed Samling Global Ltd.

Samling Global will pay RM1.63 cash for each of the 216.16 million Lingui scheme shares or 32.77 million held by the shareholders. This would amount to RM352.34mil. The shareholders are expected to be paid on March 6.

Samling Global, which is owned by Miri-based tycoon Tan Sri Yaw Teck Seng and son Datuk Seri Yaw Chee Ming, had recently taken private plantation firm Glenealy Plantations (Malaya) Bhd, Lingui’s associate, for RM396.3mil.


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