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SOPB expects bigger harvest

KUALA LUMPUR: Sarawak Oil Palms Bhd (SOPB) expects to harvest one million tonnes of fresh fruit bunches by year-end, 15 per cent more than last year’s 883,000 tonnes, as more young trees mature and bear more fruits.

Headquartered in Miri, the group has planted close to 63,000 hectares with oil palms in Sarawak.

In an interview, SOPB group financial controller Eric Kiu Kwong Seng spoke of the company’s favourable tree profile. “As of December 2012, about 24 per cent of our planted area is of prime fruit bearing ages. As more young trees mature, we expect very good harvest prospects,” he told Business Times in an interview.

“By the end of this year, about 30 per cent of our total planted area will be of matured ages and bearing more fruit bunches,” he said when met at the sidelines of Palm and Lauric Oils Conference and Exhibition (POC2013) here yesterday.

SOPB’s aggressive plantings in 2007 have resulted in 80 per cent of its planted area consisting of young oil palms and primed to bear more fruit bunches. This means big earning’s growth potential in the next five years. To date, SOPB has planted more than 80 per cent of its 75,155ha landbank.

On the group’s refinery in Bintulu, Kiu said: “We started operations at the refinery in mid-2012. Following the government’s crude palm oil tax restructure early this year, the trading environment has become more conducive. We’re now running at full capacity”.

SOPB was set up in 1968 via a joint venture between Commonwealth Development Corp (CDC) and the Sarawak state government. In 1995, conglomerate Shin Yang Group bought CDC’s entire stake and is now the largest shareholder with 36.5 per cent while state-owned Pelita Holdings Sdn Bhd holds 28.9 per cent.

In its filing to the stock exchange, SOPB said its profits for 2012 fell 34 per cent to RM159.13 million on the back of RM1.31 billion revenue. Kiu attributed it to unencouraging performance to falling palm oil prices, lower cropping cycle after the bumper crop in 2011 and dilution effect from the young mature estate.

He said the group had in 2011, declared a payout 5 sen a share. Asked if the group is still able to match the same payout, he replied, “we’ll strike a balance of rewarding shareholders and retaining profits for business expansion”.

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