By SHAHEERA AZNAM SHAH
PPB Group Bhd plans to expand its milling operation in Vietnam, spurred by the rising flour demand in the Indochina country.
MD Lim Soon Huat said the company has set aside RM90 million capital expenditure (capex) to build a milling factory in Vietnam to match demand and increase its production capacity.
“We are investing in a new milling operation in Vietnam that would cost RM90 million to enhance our milling capacity, which at the moment stood at 7,270 metric tonnes per day.
“So far, we have capitalised RM1 million for the early stages of the development,” he said at the company’s AGM in Kuala Lumpur yesterday, He said the factory is expected to be completed in 2019.
The company posted a total revenue of RM4.3 billion for the financial year 2017, helped by the higher flour sales in Malaysia and Vietnam.
Moving forward, Lim said the RM90 million milling factory for flour is part of the company’s larger RM620 million capex allocated for the group’s grains and agribusiness, and films exhibition and distribution divisions.
“The RM620 million has been set aside for our expansion across two divisions for the next three to four years,” he said.
The group’s films exhibition and distribution unit, Golden Screen Cinema Sdn Bhd (GSC), is on a business expansion mode and it plans to open nine new cinemas by 2021.
“We are investing RM300 million to add nine more cinemas in Penang, the Klang Valley and Johor Baru,” said GSC CEO Koh Mei Lee.
On the proposed acquisition of Armed Forces Fund Board’s 16.8% stake in Hillcrest Gardens Sdn Bhd, Lim said the group is not in a rush to enter into other land acquisition deals due to the subdued property market.
“We will continue to identify possible landbank. However, we are not in a hurry. We see the market is quite depressed for us to enter into more deals,” he said.
PPB is controlled by tycoon Tan Sri Robert Kuok who has recently being named as one of the members of the country’s council of eminent individuals.
Meanwhile, PPB chairman Tan Sri Oh Siew Nam expects the abolishment of the Goods and Services Tax would improve household spending and benefit sectors such as entertainment, retail and consumer products.