Tuesday, Apr 12, 2005
The rating of Kwantas Corporation Berhad (KCB) has been reaffirmed at A+ID, underpinned by the integrated nature of the KCB Group’s palm oil operations; its expanding activities namely, the establishment of operations in China (Guangzhou and Zhangjiagang), the commercialization of renewable bio-mass energy and the Group’s strengthening financial profile.
KCB Group’s credit strength is drawn from the integrated nature of its operations ranging from oil palm plantation, milling, kernel crushing, refinery, bulking installation, bio-mass energy and wholesaling of diesel and lubricants to trading of refined soya bean and rapeseed oil. Sales of refinery products together with milling accounted for more than 90% of the Group’s total revenue. The increasing trend of revenue over the past four fiscal years, reaching RM1.3 billion in FY2003 and RM1.2 billion in FY2004 was a result of high palm oil product prices supported by an increase in demand for edible oils vis-à-vis lower production of competing soya bean oil.
In addition to the main palm oil-based activities, the Group has its own bulking installation facility for storage, handling and transportation/exporting refined products to overseas destinations. Electricity produced by its 9.8 mega watt bio-mass plant is utilized internally with a view to sell part of the surplus bio-mass energy to external parties at an appropriate time in the future. For its overseas operations, the ongoing expansion in China would be independently funded by the respective operating subsidiaries. This would eventually witness substantial contribution to the Group’s bottomline, moving forward. KCB’s shortening plant and refinery soap noodle plant in China have commenced operations and will see contributions to the Group’s earnings in fiscal year 2005.
KCB Group’s credit strength is drawn from the integrated nature of its operations ranging from oil palm plantation, milling, kernel crushing, refinery, bulking installation, bio-mass energy and wholesaling of diesel and lubricants to trading of refined soya bean and rapeseed oil. Sales of refinery products together with milling accounted for more than 90% of the Group’s total revenue. The increasing trend of revenue over the past four fiscal years, reaching RM1.3 billion in FY2003 and RM1.2 billion in FY2004 was a result of high palm oil product prices supported by an increase in demand for edible oils vis-à-vis lower production of competing soya bean oil.
In addition to the main palm oil-based activities, the Group has its own bulking installation facility for storage, handling and transportation/exporting refined products to overseas destinations. Electricity produced by its 9.8 mega watt bio-mass plant is utilized internally with a view to sell part of the surplus bio-mass energy to external parties at an appropriate time in the future. For its overseas operations, the ongoing expansion in China would be independently funded by the respective operating subsidiaries. This would eventually witness substantial contribution to the Group’s bottomline, moving forward. KCB’s shortening plant and refinery soap noodle plant in China have commenced operations and will see contributions to the Group’s earnings in fiscal year 2005.