Business & Markets 2013
Written by Charlotte Chong of theedgemalaysia.com
Tuesday, 16 July 2013 10:04
KUALA LUMPUR: TDM BHD  is keen to reduce its dependency on its PLANTATION  division and enhance its other core division, healthcare.
Its chairman Datuk Roslan Awang Chik said it is planning to cut down the plantation sector revenue contribution to 70% from the existing 85% to 90%.
TDM chief financial officer Amir Mohd Hafiz Mohd Khalid, meanwhile, said the group will continue to drive its brand for both sectors in the face of increasing competition.
For the plantation division, the company will continue to be operationally effective via its efficiency and productivity programmes which aim to reduce cost and improve yield.
TDM aims to grow its oil extraction rate (OER) by 1% in 2013 and upgrade its mill front-end system and oil recovery system.
TDM operates two palm oil mills, which are located in Sungai Tong and Kemaman in Terengganu, with an aggregate annual milling capacity of 600,000 tonnes of fresh fruit bunch (FFB).
The average age of the company's oil palm trees is 17 years, with more than 50% of the trees aged between 11 and 20. Younger trees (four to 10 years) comprise about 9%, while about 24% of the trees are three years old or less. The remaining 16% are 21 years and above.
"The significant percentage of immature trees (24%) translates into good growth in FFB production going forward," Amir told The Edge Financial Daily in an interview.
Consultancy firm iCapital said in a report recently that TDM's first bio-composting plant in Sungai Tong commenced operations last year, converting mill waste into bio-organic fertiliser.
TDM is able to produce 12,000 tonnes of fertiliser at this plant annually to fulfil 40% of its organic fertiliser requirement. TDM will start operating its second bio-composting plant in Kemamam in December 2013, which will add another 24,000 tonnes of fertiliser.
This may lead to the group saving up to RM6 million in fertiliser cost, said iCapital.
Amir said the organic fertiliser produced at the two plants is for the company's internal consumption.
"We do not expect to sell the organic fertiliser externally. Thus, there will not be any direct profit from this exercise."
Meanwhile, the company is positioning itself as “no frills secondary care community hospital" provider, where the emphasis is on patient care and medical procedures, minus the luxuries.
"You pay for good care, not for the luxury and this is without compromising the quality of care," Amir said.
"It also means that the locality of the hospital must be convenient to the community that it is trying to serve."
The group's premier hospital, Kuantan Medical Centre, is expected to open its doors to the public in early 2014. Its Kuala Terengganu Specialist Hospital is expected to be completed in 2016.
These two hospitals will each have five operating theatres and an intensive care unit (ICU) with 12 beds. The group currently owns four community specialist hospitals, including Kelana Jaya Medical Centre and Taman Desa Medical Centre. These medical centres, with 80 to 150 beds each, provide affordable secondary healthcare services.
This article first appeared in The Edge Financial Daily, on July 16, 2013.
Publish date: 16/07/13