PPB allocates RM440 mln capex to strengthen core businesses

by **Cals** Thu 06 Mar 2014, 17:29

Business & Markets 2014

Written by Bernama

Thursday, 06 March 2014 16:30

KUALA LUMPUR (Mar 6): PPB Group Bhd is allocating RM440 million for capital expenditure in the next two to three years to strengthen its core businesses, said Managing Director Lim Soon Huat today.

"The amount will increase depending on the requirements of the new projects," he told a media briefing on the group's full-year financial
performance ended Dec 31, 2013.

The group's major operations include flour and feed milling, grains trading, marketing, distribution and manufacture of consumer products, film exhibition and distribution as well as property investment and development.

The group will see an expansion of its film exhibition and distribution segment, with the addition of 11 new cinemas in the next three years.

PPB Group owns 100 per cent equity interest in Golden Screen Cinemas Sdn Bhd (GSC) via its leisure and entertainment arm, PPB Leisure Holdings Sdn Bhd.

To date, GSC operates a total of 233 screens.

The group will invest RM179 million for the expansion of the cinemas and the upgrading of existing cinema equipment, and this year will open six new cinemas in Seremban, Ipoh and the Klang Valley.

Lim said the property segment would start contributing to the group's bottomline from financial years 2015 to 2017, with new development plans coming in.

"This year, our focus will be on the development of high-end bungalows in Seberang Prai, which we launched in February. We are encouraged by the response from buyers, it is up to 50 per cent sold," he said.

The group also expects its mixed-development project at Puteri Harbour in Iskandar Malaysia to contribute to its revenue from 2015 to 2017.

PPB Group also sees opportunities in the water/sewerage business from the consolidation of Selangor's water assets.

"We will restrict to Selangor only. Once it consolidates (its water assets), the state will have plans to expand, and then we would have an opportunity in that area and the demand for water will have definitely increased," said ChemQuest Sdn Bhd Group Managing Director Leong Yew Weng.

ChemQuest is a subsidiary of PPB Group.

The group's pre-tax profit grew 18 per cent to RM1.079 billion for the financial year ended Dec 31, 2013 against the previous financial year.

Its revenue rose 10 per cent to RM3.313 billion on-year due to higher revenue from the flour and feed milling as well as grains trading segments.