QL ... Aug12

Its integrated livestock farming business is suffering from the high prices of raw materials such as maize and soybean which are the ingredients for the feed meal for chickens and chicks.

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

It is now growing from a high base after couple of years prior to FY2012.

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

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

By 2015, the contribution from oil palm plantation will stand at around 20% of QL’s top line provided QL’s integrated livestock and marine product manufacturing businesses continue to expand at their current pace in the next two to three years.

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