TSH ... May 09

TSH Resources Bhd, which bought two Indonesian plantation companies last year, is on the lookout for additional oil palm land in the republic. The move is part of its long-term plans to grow gradually from being a small plantation-based company to a mid-sized player.

They are currently exploring opportunities (in Indonesia and Malaysia) and are in talks with a few companies. They are not expanding 100,000ha right away, but slowly and gradually around 5,000ha to 6,000ha in Malaysia and 15,000ha to 20,000ha per year in Indonesia.

TSH has a landbank of almost 80,000ha, of which less than 10 per cent is in Malaysia, mainly in Sabah.

In June 2008, TSH bought the entire paid-up capital of the Singapore-based Martinique Cove Pte Ltd, which owns 90 per cent of Indonesian plantation company PT Mitra Jaya Cemerlang. The acquisition added 15,000ha to TSH's landbank.

In December 2008, the group bought the entire stake of another Singapore company, Elaeis Pte Ltd, which owns 90 per cent of the Indonesia-based PT Farinda Bersaudara. This added 13,000ha to its landbank.

On its lower net profit last year, he attributed it to unrealised foreign currency losses of RM31.7 million.

Over the next few years, some of our oil palm trees will start to mature, bringing in more cash flow and revenue for them to repay loans as well as (gaining from the) strengthening crude palm oil prices of up to RM2,700 from RM1,800 a tonne before.

On its cocoa plantations, it had no plans to expand the business, which contributes some 10 per cent of revenue.

TSH Resources Bhd, which owns 65 per cent of Ekowood, had no plans to divest its stake as the latter was still a good company. It had registered profits for the past five years.

Ekowood reported RM2.3 million net loss in the first quarter ended March 31 2009 against RM3.4 million net profit in the same quarter last year, hurt by lower sales volume. Ekowood derives four-fifths of its revenue from overseas markets spanning Europe, the US and Asia.