Page 16 - MFBD 1920_02Mar2020
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Editorial
producing premium Milie Dilard (MD2) pineapples under the Tropicale brand for local distribution and export. Naza Agro’s long-term vision is to establish strong presence in the China market and continue to explore other export markets such as Japan, South Korea and the Middle East for its tropical fruits business. Plans are also in the pipeline to expand the company’s tropical fruits plantation land bank by another 809.3ha which includes planting of pineapple, melon and durian for export market within  ve years’ time.
Malaysian pineapples are also making inroads into the Middle East, where the Malaysian Pineapple Industrial Board (MPIB) targets to export up to 100 tonnes of Josapine pineapples to Dubai in the  rst half of 2019. MPIB Director-General Datuk Mohd Anim Hosnan said the projection was realistic as the Josapine variety of pineapples had attracted encouraging demand from the emirate and possessed high commercial value. The Josapine variety was selected for export after MD2 due to its durability, resistance to diseases and shorter harvesting period of only 12 months.
Moving on to poultry developments, Japanese food processing group NH Foods Ltd and poultry and eggs  rm Lay Hong Bhd, of cially opened their new food manufacturing plant in Pulau Indah November last year. The plant is operated by NHF Manufacturing (Malaysia) Sdn Bhd, owned 51% by NH Foods and 49% by Lay Hong. With a production capacity of 1,200 tonnes per month in Phase 1, this halal frozen food manufacturing facility was designed to cater not only to the local market, but to export markets such as Middle East countries, Singapore and Japan. The plan is to start exporting the products in the second half of 2019, with a ratio of 60% export and 40% domestic. The plant covers a total area of 4.58 acres, with expansion to 2,000 tonnes per month in Phase 2. Products under the Pulau Indah plant will be branded as Nippon Premium NutriPLus, which consist of Chicken Karaage (boneless diced thigh meat), Chiki-Chiki Bone (cut middle wing), Amakaraage (boneless whole thigh meat), Tebamoto Amakaraage (chicken drumette) and Chicken Menchi Katsu (boneless chicken meat and vegetables).
In terms of performance, Lay Hong slipped into the red in the second  nancial quarter ended September 30, 2018 (2QFY19), posting a net loss of RM10.96 million, its  rst loss-making quarter in two-and-a-half years, compared with a net pro t of RM12.17 million a year ago due to higher feed cost, resulting from the stronger US dollars. The group also attributed the loss to the one-time early retirement of the layer’s amortisation cost for a  ock of birds. Quarterly revenue was down 8.6% to RM187.03 million from RM204.56 million a year ago, weighed down by lower revenue from its integrated livestock business as a result of lower quantity of poultry products being sold and the booking in of goods returned of deteriorated processed chicken products.
For the cumulative six months ended September 30, 2018, Lay Hong posted a net loss of RM8.68 million compared with a net pro t of RM16.59 million a year ago, while revenue fell by a marginal 0.34% to RM386.28 million from RM387.59 million in the previous corresponding period.
On prospects, Lay Hong said the average egg price is expected to rise in the coming quarters after industry players have decided to reduce production in order to regularise the oversupply situation experienced in the recent quarter. For the liquid egg business, the commissioning of the equipment in the new plant in Johor is progressing as per schedule. With these in place, the  nancial performance of the group going forward would be given a boost. However, it also noted that the continuous strengthening of the US dollar against the ringgit have caused all imported raw and packing materials particularly the feed cost to rise, which will impact pro tability going forward.
Competitor CAB Cakaran Corp Bhd also saw its net pro t for the fourth quarter ended September 30, 2018 (4QFY18) plunged 98% to RM508,000 from RM27.18 million a year ago, on lower average selling price of broilers as well as an increase in feed and distribution costs. Its supermarket division also suffered a small loss compared to a pro t a year ago, mainly due to the lower margin achieved by certain
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