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Malindo to increase poultry feed output capacity by 50%
Not chicken feed: PT Malindo Feedmill independent commissioner Koh Bock Swi looks on as (from left to right) independent director Dato Seri Abdul Azim bin Moh
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Not chicken feed: PT Malindo Feedmill independent commissioner Koh Bock Swi looks on as (from left to right) independent director Dato Seri Abdul Azim bin Moh. Zabidi, independent commissioner Yongkie Handaya, director Tan Sri Lau Tuang Hguang, president director Lau Chia Nguang and commissioner Tan Lai Kai discuss matters following the companyâs shareholders meeting in Jakarta on Tuesday. (JP/Jerry Adiguna) (from left to right) independent director Dato Seri Abdul Azim bin Moh. Zabidi, independent commissioner Yongkie Handaya, director Tan Sri Lau Tuang Hguang, president director Lau Chia Nguang and commissioner Tan Lai Kai discuss matters following the companyâs shareholders meeting in Jakarta on Tuesday. (JP/Jerry Adiguna)
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span class="inline inline-none">Not chicken feed: PT Malindo Feedmill independent commissioner Koh Bock Swi looks on as (from left to right) independent director Dato Seri Abdul Azim bin Moh. Zabidi, independent commissioner Yongkie Handaya, director Tan Sri Lau Tuang Hguang, president director Lau Chia Nguang and commissioner Tan Lai Kai discuss matters following the company's shareholders meeting in Jakarta on Tuesday. (JP/Jerry Adiguna)
Publicly listed poultry company PT Malindo Feedmill Tbk (MAIN) will strengthen its poultry feed business by increasing its production capacity more than 50 percent from its current output of 900,000 tons per year.
The target will be supported by the company's new feed mill in Semarang, Central Java, which is now near completion. The company plans to build another feed mill in Makassar, South Sulawesi as well.
Malindo corporate secretary Rudy Hartono Husin said on Tuesday the company would also develop several day-old chicken breeding farms in Kalimantan, Java and Sumatra.
'[The company] is targeting to start the development of the Makassar feed mill in the fourth quarter of this year. The project may be finished in around one year,' he told reporters Tuesday in Jakarta.
Meanwhile, the Semarang feed mill is expected to start operating within the next few weeks. 'The Semarang feed mill is currently in the completion phase. I hope the mill can start operation next month at the latest,' he said.
Once the Semarang feed mill is up and running, the company's output capacity will increase by 50 percent. Another 20 percent increase will come from the Makassar feed mill.
According to Rudy, each mill required investment of around Rp 200 billion (US$16.9 million).
Meanwhile, with the company's planned day-old chicken breeding farms in Kalimantan, Java and Sumatra, it aims to increase day-old chicken production capacity by 15 percent.
He refused to mention the specific value of the investments. 'The developments are ongoing,' he added.
Malindo director Rewin Hanrahan added that the Semarang feed mill would have a production capacity of 360,000 tons per year, while the company was also targeting the same production capacity for the Makassar feed mill.
'However, the company probably will build the Makassar feed mill with a capacity of 240,000 tons per year at first,' he said.
Meanwhile, Rudy said that the company allocated capital expenditure of around Rp 500 billion this year, 20 percent more than last year's capital expenditure of around Rp 400 billion.
'The company has absorbed around 40 percent of it, mainly for the development of the two new mills,' he said.
The capital expenditure, he said, was from a rights issue in April and bank loans. 'The company managed to secure around Rp 336 billion [from the rights issue]. A part of that is used for capital expenditure,' he said, adding that the company was currently seeking the right banks for the loan.
Rudy added that Malindo had also conducted research to market its subsidiary PT Malindo Food Delight's processed-food products, such as chicken nuggets and sausages, to Japan. 'We are targeting Japan because Japan has the highest consumption rate of chicken nuggets,' he said.
In late 2013, the company began investing in the downstream via a food processing business under its subsidiary PT Malindo Food Delight, which produces fast food.
According to a statement, the company recorded a 25 percent increase in its net sales last year to Rp 4 trillion from Rp 3.3 trillion in 2012. It was mainly driven by the sales increase in poultry feed and day-old chicken. However, its net profit decreased by 20 percent to Rp 242 billion from Rp 302 billion last year.
