May 17, 2013

MFM eyes Myanmar for flour milling business

Malayan Flour Mills Bhd (MFM) is looking at Myanmar as a potential market for its flour milling business as there are currently very few flour milling companies there, said its chairman Tan Sri Arshad Ayub.

"We are eyeing an increase of up to 5% in our milling business this year. After our successful joint venture in Indonesia, we are looking at Myanmar as another potential destination," he told reporters after the group's AGM today.

Milling business currently contributes about 50% to 70% of the group's profit.

MFM started its flour milling business in Indonesia via its 30%-owned joint venture with PT FKS Capital, Toyota Tsusho Corp, Toyota Tsusho (S) Pte Ltd and PT Toyota Tsusho Indonesia called PT Bungasari Flour Mills Indonesia.

The group also owns two milling plants in Vietnam.

Arshad said the plant in Indonesia produces about 1,500 tonnes of wheat flour a day.

He said the expansion of the group's manufacturing, packaging and warehousing facilities in Lumut has been completed and commercial production commenced in the last quarter of 2012.

"Similar expansion in the Pasir Gudang plant is to be completed in August or September.

"The increased capacity in both our flour milling facilities will enhance our position in supporting our customers' needs and in meeting market demand," he said.

MFM has also interests in poultry and raw materials trading.

Arshad said the fluctuating commodity prices and volatility of foreign exchange rate are the biggest challenge for the group.

"We will continue to grow our economies of scale and leverage on our competitive advantages and improve efficiency," he added.

The group's pre-tax profit for the financial year ended Dec 31, 2012 fell to RM51.18 million from RM103.61 million in the same period last year. However, revenue rose to RM2.03 billion from RM1.92 billion last year.

Source: The Sun Daily