Thursday 9 August 2012

QL Resources - Suffering from the high prices of raw materials suchas maize and soybean


Its integratedlivestock farming business is suffering from the high prices of raw materials suchas maize and soybean which are the ingredients for the feed meal for chickensand chicks.

On top of that, the age profile of the group’s oil palmplantation in East Kalimantan Indonesiais still relatively young. It will take several more years for the age profileto mature to give QL good yield.

It is now growing from a high base after couple of years prior toFY2012.

QL has been very cautious in growing its businesses. It has set up asolid foundation for the businesses to grow. However most of the growth factorswill only be recognized from FY2014 onwards.

Among the growth factors that will contribute to QL’s higher netprofit growth in FY2014 is the maturing oil palm. QL has 15000ha of oil palmplantation in East Kalimantan but only 4000haare considered mature at the moment.

By 2015, the contribution from oil palm plantation will stand at around20% of QL’s top line provided QL’s integrated livestock and marineproduct manufacturing businesses continue to expand at their current pace inthe next two to three years.

The group has invested some more than rm300 million in its farms andfacilities in Vietnam and Indonesia .

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