BStead ... Apr10

It is targeting to sell off its 17,000ha of plantation land in south-west Sumatra before year-end to raise about US$50mil from the sale. Over 50% of the land was currently planted with oil palm.

Boustead would continue to hive off its non-core and non-performing assets to improve efficiency and also reduce bank borrowings. Boustead had managed to dispose of its non-profitable businesses and non-core assets over the years which had helped to reduce its gearing. Its gearing is currently 0.8 times, compared with 1.2 times in 2009.

On dividends, Boustead would continue with its quarterly dividend payout although it was not a written company policy. The payout was on condition it remained profitable.

For the financial year ended Dec 31, 2009 (FY09), Boustead paid out dividends net-of-tax amounting to 22.1 sen per share. The total dividend payout of RM184mil represents 54% of its attributable profit and a 27% increase from the payout from FY08.

The company would gain RM363 million from its disposal of the 80% stake in BH Insurance (M) Bhd to AXA Affin General Insurance Bhd. In addition, Boustead would also rake in RM75mil profit from BH Insurance’s business prior to the stake sale. After the disposal of BH Insurance, it still maintained a 20% stake in Affin Bank.

Boustead would continue to focus on its six core business divisions - heavy industry,
plantation, property, trading, finance and investment as well as manufacturing and services.

The heavy industry division, especially shipbuilding, would continue to be the key driver of growth for the company. The division now contributed about 30% to revenue, adding that the finance and investment division contributed about 20%, property 20%, plantation 15%, trading 10% and manufacturing 5%.