TH Plantations sees higher earnings after land deal

KUALA LUMPUR: Lembaga Tabung Haji's plantation arm, TH Plantations Bhd, is set for higher earnings in the future after completing the acquisition of two plantation companies in Sarawak.

TH Plantations chief executive officer Datuk Zainal Azwar Zainal Aminuddin said its plantation area has swelled to 97,692ha from 91,078ha, now that Bumi Suria Ventures Sdn Bhd and Maju Warisanmas Sdn Bhd are under its wings.

"Of the 97,692ha, 51,500ha are in Sarawak. This acquisition has also strengthened our presence as one of the major plantation players in Sarawak," Zainal said here yesterday after its annual shareholders meeting.

He said as an enlarged firm, it will produce 800,000 tonnes of fresh oil palm fruit bunches a year from 500,000 tonnes previously at an annual growth rate of 17 per cent a year for the next four years.

"The purchase is timely as it is in line with TH Plantations' expansion at a strategic location. It will also complement our exisiting growth."

He said TH Plantations is interested in boosting its landbank, especially brownfields, but for now, it wants to focus on its existing landbank.

"Our plantation land will also swell to 110,000ha by the end of the first quarter when we complete our acquisition of Indonesia's PT Persada Kencana Prima, which owns 14,000ha in Kalimantan."

TH Plantations is allocating RM75 million in the next four years to build an oil palm mill in Sarawak as well as nurture its young oil palm trees.

On crude palm oil (CPO) prices, TH Plantations chairman Tan Sri Dr Yusof Basiron said the prospects remain bright this year due to robust global demand.

"I believe CPO prices will climb to the RM3,000 level by the middle of the year due to strong demand. This oil is also cheaper compared with soyabean oil."