The hard work it has put into plantingan average 3600ha a year since 2006 has paid off. Over the next two to three years from Aug 2013, TSH anticipates sustaining its high double digit growth even if the group were to stop new planting today (Aug 2013). The primarily growth drive is its weighted average age profile of about seven years with 76% of trees in the planted area below seven years old.
It is committed to sustaining its organic growth with targeted new planting of 3000ha to 4000ha each year supported by its 68520ha of unplanted land bank in Indonesia.
The main concern is its high net gearing of one time (March 2013). While manageable, it may impede its aggressive expansion plan amidst a protracted weak year to date CPO average selling price.
To address its gearing, it had raised about rm48 million in cash via a 2.5% share placement. The successful disposal of its 16.2% stake in Pontian United Plantations Bhd to FGV for rm195 million cash will help lower its net gearing to about 0.7 times.
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