Author: Koon Yew Yin | Publish date: Fri, 31 Jan 08:23
Koon Yew Yin
My main objective to reproduce this article is to teach you how to become a super investor. My intention is noble but it would seem that I am boasting again.
As I said many a time before, there are many share selection criteria such as P/E , dividend yield, price to book value, NTA etc, but I consider the most important criterion is profit growth prospect.
Before you buy any share you must make sure that the company can make more money this year than last year and it can make more money next year than this year and continue to make increasing money in the foreseeable next few years.
Jaya Tiasa has this ability of producing more and more profit in the next 10 years. Now you, especially kk123 & wt222 who has ridiculed me before must go back to study my article “Why I sold R Sawit and SOP to buy Jaya Tiasa”. It is important for those who have not been successful in stock picking must change their old style or mind-set. Kk123 & wt222 must examine your track record to realise how well you have performed before you dare to ridicule me.
I published the following article on Tradewinds Plantation on
Koon Yew Yin- 22nd Feb 2013
There are many famous cash rich plantation companies but they are usually fully valued. Of course, it is very safe to buy them but I prefer to buy undervalued shares and take some calculated risk to earn exceptional profit.
On 19th March 2012, UOB Kay Hian published a report on Tradewinds Plantation (TWSP). The salient points are:
a) TWSP is the sixth-largest plantation company in Malaysia by planted area. Only six listed plantation companies in Malaysia have a planted area of over 90,000ha each.
b) Its FFB production to grow at 3-year CAGR of 13.4%. Fresh fruit bunch (FFB) production is expected to grow 12-15% in 2012-14, higher than industry growth of 5-8%. The strong production growth will be supported by: a) 11% pa increase in mature area for the next four years, b) 20% of young areas to provide strong double-digit growth, and c) yield improvement in its prime areas (49% of planted areas).
c) It is a hidden gem. All TWSP’s land is within Malaysia. Given the scarcity of land in Malaysia, its land would be more valuable than similar land in Indonesia. At the current plantation land market price, Tradewinds’ RNAV would be RM19.58, significantly higher than its current share price.
With its FFB production increases by 13% (compound annual growth rate) and its recent acquisition, TWSP has more planted land and FFB production than Genting Plantation.
FFB production (Tons): Dec 2012 - Nov - Oct - Sept total
TWSP 149,000 - 167,000 -178,000 – 154,000 = 648,000
Genting Plant 155,000 – 156,000 – 149,000 -147,000 = 607,000
Basing on the closing share price on 21th Feb 2013 the market capitalisation of TWSP is Rm 4.42 X 529 million issued shares = Rm 2,338 million and Genting Plant is Rm 8.42X 759 million issued shares = Rm 6,390 million.
That is why the controlling shareholders want to buy up all TWSP shares that they do not own. Under the takeover code, they cannot do it because I have accumulated sufficient shares to block them.
If you decide to buy TWSP, I am not responsible for your profit or loss.
======================================================================
MY REASONS FOR BUYING JAYA TIASA
Fight the Smear Campaign against the Oil Palm Industry
Koon Yew Yin
I refer to the Business Times 17th Jan 2014: Head Line 'Wilmar hurting palm oil exports'
MALAYSIA will lose billions of ringgit in palm oil exports should Wilmar International Ltd be allowed to discriminate against Sarawak's palm oil supply.
Sarawak Oil Palm Plantation Owners Association (Soppoa) said it strongly rejected attempts by Wilmar, Unilever Plc and World Wide Fund for Nature (WWF) to discriminate against the state's palm oil supply and, in the same process, jeopardise Malaysia's palm oil exports.
"We are very disappointed with Wilmar's unilateral action to discriminate against palm oil harvested from oil palm trees grown on peat soil," said Soppoa manager Melvin Goh.
Read more: 'Wilmar hurting palm oil exports' http://www.btimes.com.my/Current_News/BTIMES/articles/20140117014922/Article/index_html#ixzz2qcXEvjUr
My article:
Some observers in the west used it as an occasion to bad-mouth the oil palm oil further. In this article, I will try to share some facts of life in the oil palm industry so that Malaysians will not join the western world in their smear campaign.
Firstly, we must remember that the west had cut down their forests and trees centuries ago to develop their countries. Malaysia and Indonesia are both new comers in the development scene and have been felling our forests for only a few decades now. Of our tropical agricultural crops, oil palm is the most recent cash crop commodity.
Although there has been a rapid rate of exploitation, it still occupies a small proportion of our total land area. The oil palm industry in Malaysia accounts for 15.5 per cent of total land area and only 4.5 per cent of total land area of Indonesia. A large proportion of the oil palm plantations are also not newly felled forest but are old rubber plantations that have been converted to this more lucrative crop.
Many in the public know of my views which are critical of many developments in the country. However, praise needs to be given when it is deserved; and our home grown oil palm industry is one which deserves all our support. This support is important in view of the sustained criticism made against the oil palm industry by lobby groups that have their origin in the west.
Why We Should Support Our Oil Palm Industry
There are many good reasons to support our oil palm industry in Malaysia and Indonesia. These are some of the most important.
1. Firstly it is not only Felda settlers that are dependent on the crop for a livelihood. Malaysia’s annual US$25 billion (RM79.75 billion) palm oil exports support some two million jobs and livelihoods along the sprawling value chain. This means that one in every five working Malaysian is dependent for his or her livelihood on the crop.
2. Plantations have borne the brunt of the bad publicity. However, the small farmers are also affected. More than 40 per cent of oil palm planters in Indonesia are smallholders whilst in Malaysia they contribute to 38 per cent of the country’s palm oil output.
3. Environmental activist groups such as World Wildlife Fund, Friends of the Earth and Greenpeace have launched many campaigns alleging that the expansion of oil palm plantations have destroyed forests, threatened endangered wildlife and robbed indigenous peoples of their land. Many of their arguments are not based on fact but are sensationalized from a small and atypical number of cases.
4. The anti-oil palm lobby in the west includes pro-soya bean and rape-seed groups who see oil palm as a major competitor and have recruited food lobbyists to play on fears of the health hazards of palm oil consumption. . Together with environmental activists, these well-funded groups have created trade barriers to the global oil palm trade under the pretext of environmental activism.
5. In a fair contest amongst competing vegetable oils, palm oil will win hands down. The oil palm tree is the world’s most efficient oil crop because one can harvest five tonnes of oil per hectare. This is 10 times more productive than soya bean planted in the West, including United States and five times more productive than rapeseed, Europe’s main oil crop.
6. It is an undeniable fact that palm oil is the cheapest and most popular form of cooking oil for consumers, including many poor families in the west. Should trade barriers to benefit rapeseed farmers who are already heavily subsidised by the European Union (EU) government be successfully implemented, this will hurt consumers all over the world.
7. Also should alternatives to oil palm be grown, more land would be needed to produce an equivalent volume of oil to replace palm oil, resulting in more deforestation and problems for Mother Earth.
8. Oil palm smallholdings and plantations meet the United Nation’s Framework Convention on Climate Change which defines a forest as an area of 0.5 to one hectare having more than 30 per cent canopy cover and having a potential height of two to five metres. To accuse the industry in Malaysia and Indonesia of contributing to global warming is sheer nonsense. In fact oil palm trees just as with other forest species, produce oxygen for us to breathe and act to counter coal and oil emissions which are the major cause of global warming.
9. Finally, the western environmental activists’ campaign against oil palm plantation expansion, in the name of “saving rainforests”, is a violation of international norms and Malaysia’s and Indonesia’s sovereignty.
Conclusion: I trust all Malaysians will circulate this article to all their contacts to fight against the smear campaign against our palm oil industry and eventually I hope consumers, all over the world, will not buy soyabean or rapeseed oil which is more expensive and not really superior to palm oil.
Koon Yew Yin - 30th Jan 2014
What kind of men would cut down these ancient irreplaceable giants trees? Each of them was over one thousand years old. Over a period of a few decades around 1850, 95% of the two million acres of Redwood forest in California were cut and destroyed.
Now they say we are wrong to cut our trees to plant oil palms. What do they say when Brazil cut down their rain forest to plant soya beans? Let us examine the true situation.
Oil palm smallholdings and plantations meet the United Nation’s Framework Convention on Climate Change which defines a forest as an area of 0.5 to one hectare having more than 30 per cent canopy cover and having a potential height of two to five metres. To accuse the industry in Malaysia and Indonesia of contributing to global warming is sheer nonsense. In fact oil palm trees just as with other forest species, produce oxygen for us to breathe and act to counter coal and oil emissions which are the major cause of global warming.
Environmental activist groups such as World Wildlife Fund, Friends of the Earth and Greenpeace have launched many campaigns alleging that the expansion of oil palm plantations have destroyed forests, threatened endangered wildlife and robbed indigenous peoples of their land. Many of their arguments are not based on fact but are sensationalized from a small number of cases.
The anti-oil palm lobby in the west includes pro-soya bean and rape-seed groups who see oil palm as a major competitor and have recruited food lobbyists to play on fears of the health hazards of palm oil consumption. . Together with environmental activists, these well-funded groups have created trade barriers to the global oil palm trade under the pretext of environmental activism.
In a fair contest amongst competing vegetable oils, palm oil will win hands down. The oil palm tree is the world’s most efficient oil crop because one can harvest five tons of oil per hectare. This is 10 times more productive than soya bean planted in the West, including United States and five times more productive than rapeseed, Europe’s main oil crop.
It is an undeniable fact that palm oil is the cheapest and most popular form of cooking oil for consumers, including many poor families in the west. Should trade barriers to benefit rapeseed farmers who are already heavily subsidised by the European Union (EU) government be successfully implemented, this will hurt consumers all over the world.
Also should alternatives to oil palm be grown, more land would be needed to produce an equivalent volume of oil to replace palm oil, resulting in more deforestation and problems for Mother Earth.
Finally, the western environmental activists’ campaign against oil palm plantation expansion, in the name of “saving rainforests”, is a violation of international norms and Malaysia’s and Indonesia’s sovereignty.
Now I like to see those senseless critiques of my article "Why I sold R Sawit & SOP to buy Jaya Tiasa?" to make some intelligent comments. While I try to teach them to be super investors, they hide themselves behind pseudonym names like kk123 or wt222 to ridicule me. They are cowards.
Conclusion: I believe our palm oil industry will remain competitive and profitable for a long time. "Must Buy Jaya Tiasa" Don’t take it seriously. It’s a joke. I wish all the readers a happy and prosperous for the CNY, cheers!
My main objective to reproduce this article is to teach you how to become a super investor. My intention is noble but it would seem that I am boasting again.
As I said many a time before, there are many share selection criteria such as P/E , dividend yield, price to book value, NTA etc, but I consider the most important criterion is profit growth prospect.
Before you buy any share you must make sure that the company can make more money this year than last year and it can make more money next year than this year and continue to make increasing money in the foreseeable next few years.
Jaya Tiasa has this ability of producing more and more profit in the next 10 years. Now you, especially kk123 & wt222 who has ridiculed me before must go back to study my article “Why I sold R Sawit and SOP to buy Jaya Tiasa”. It is important for those who have not been successful in stock picking must change their old style or mind-set. Kk123 & wt222 must examine your track record to realise how well you have performed before you dare to ridicule me.
I published the following article on Tradewinds Plantation on
Koon Yew Yin- 22nd Feb 2013
There are many famous cash rich plantation companies but they are usually fully valued. Of course, it is very safe to buy them but I prefer to buy undervalued shares and take some calculated risk to earn exceptional profit.
On 19th March 2012, UOB Kay Hian published a report on Tradewinds Plantation (TWSP). The salient points are:
a) TWSP is the sixth-largest plantation company in Malaysia by planted area. Only six listed plantation companies in Malaysia have a planted area of over 90,000ha each.
b) Its FFB production to grow at 3-year CAGR of 13.4%. Fresh fruit bunch (FFB) production is expected to grow 12-15% in 2012-14, higher than industry growth of 5-8%. The strong production growth will be supported by: a) 11% pa increase in mature area for the next four years, b) 20% of young areas to provide strong double-digit growth, and c) yield improvement in its prime areas (49% of planted areas).
c) It is a hidden gem. All TWSP’s land is within Malaysia. Given the scarcity of land in Malaysia, its land would be more valuable than similar land in Indonesia. At the current plantation land market price, Tradewinds’ RNAV would be RM19.58, significantly higher than its current share price.
With its FFB production increases by 13% (compound annual growth rate) and its recent acquisition, TWSP has more planted land and FFB production than Genting Plantation.
FFB production (Tons): Dec 2012 - Nov - Oct - Sept total
TWSP 149,000 - 167,000 -178,000 – 154,000 = 648,000
Genting Plant 155,000 – 156,000 – 149,000 -147,000 = 607,000
Basing on the closing share price on 21th Feb 2013 the market capitalisation of TWSP is Rm 4.42 X 529 million issued shares = Rm 2,338 million and Genting Plant is Rm 8.42X 759 million issued shares = Rm 6,390 million.
That is why the controlling shareholders want to buy up all TWSP shares that they do not own. Under the takeover code, they cannot do it because I have accumulated sufficient shares to block them.
If you decide to buy TWSP, I am not responsible for your profit or loss.
======================================================================
MY REASONS FOR BUYING JAYA TIASA - Koon Yew Yin
Author: Koon Yew Yin | Publish date: Mon, 20 Jan 13:40MY REASONS FOR BUYING JAYA TIASA
As a business man when I started buying Jaya tiasa basing on my gut
feeling and simple business logic. I believe JT is undervalued basing on
its total planted area of 62,800 ha which has an open market value of
more than twice of its market Cap. Moreover its plywood and timber
business have the competitive advantage over other manufacturers in
India, China and others because they have to buy logs from JT. JT has a
lage forrest reserve.
Why its share price is so depressed for so long? The reason is that it
is currently not showing much profit and Funds are not buying. Again as
a business man, I must consider this as a buying opportunity if the
funds buy I cannot buy so cheaply.
Many so called expert investors recommend me to buy TSH, KLK, UP, IOI
and SOP because they are showing much better earning and why should I be
so foolish to buy JT when its earning is so poor?
Again as a business man, I naturally think that if every body want
them, their prices must have been reflected and it will be very
dangerous to buy when at such high prices. How can I make money?
In fact, if you look at SOP's 2011 annual report you will see that my
wife Tan kit Pheng, my nominees Tan Kit Yew, Yap Sung Pang and I owned
about 20 million shares which we bought about 3 years ago at below Rm
3.00. We have been selling them at above RM 6 to buy JT. I am still
selling today at Rm 6.80.
After having accumulated so much, I begin to be worried in case I am
wrong and all my friends could not reassure me. Even Alvin Tai told me
not to buy about 6 months ago when I started to buy because of its poor
earnings.
Wah ! What a relief? At yesterday Seminar Alvin gave a complete
analysis of the future of the palm oil industry and he considers
SouthernAcid and JT are the best buys. He said that palm oil price will
continue to go up for many more years because most of the palms in
Indonesia are older and as a result their production cannot continue to
increase. Moreover their economy is fast improving and people want to
consume more petroleum fuel and eating oil.
To reduce their import of fossil fuel and save their foreign exchange,
the Government has a mandate to replace fossil diesel with 10
biodiesel. That is why tenders are being called for 3 million tons of
biodiesel.
For the same reason, Malaysian Government is also mandating the use of biodiesel to 10% of all diesel use.
Now I can say that I have never been surer to double my money in 3 years before with my JT.
I am obliged to tell you that JT is my major investment and I do not
need you to buy JT to support the price. You buy at your own risk.
The reasons for writing and posting this piece are: 1. To satisfy my
ego as humility is not one of my strong points, 2. Like doing charity, I
want to teach you how to fish instead for giving out fish and 3. I
seriously believe I have something really good to share with you.
Koon Yew Yin
Fight the Smear Campaign against the Oil Palm Industry - Koon Yew Yin
Author: Koon Yew Yin | Publish date: Fri, 17 Jan 11:15Fight the Smear Campaign against the Oil Palm Industry
Koon Yew Yin
I refer to the Business Times 17th Jan 2014: Head Line 'Wilmar hurting palm oil exports'
MALAYSIA will lose billions of ringgit in palm oil exports should Wilmar International Ltd be allowed to discriminate against Sarawak's palm oil supply.
Sarawak Oil Palm Plantation Owners Association (Soppoa) said it strongly rejected attempts by Wilmar, Unilever Plc and World Wide Fund for Nature (WWF) to discriminate against the state's palm oil supply and, in the same process, jeopardise Malaysia's palm oil exports.
"We are very disappointed with Wilmar's unilateral action to discriminate against palm oil harvested from oil palm trees grown on peat soil," said Soppoa manager Melvin Goh.
Read more: 'Wilmar hurting palm oil exports' http://www.btimes.com.my/Current_News/BTIMES/articles/20140117014922/Article/index_html#ixzz2qcXEvjUr
My article:
Some observers in the west used it as an occasion to bad-mouth the oil palm oil further. In this article, I will try to share some facts of life in the oil palm industry so that Malaysians will not join the western world in their smear campaign.
Firstly, we must remember that the west had cut down their forests and trees centuries ago to develop their countries. Malaysia and Indonesia are both new comers in the development scene and have been felling our forests for only a few decades now. Of our tropical agricultural crops, oil palm is the most recent cash crop commodity.
Although there has been a rapid rate of exploitation, it still occupies a small proportion of our total land area. The oil palm industry in Malaysia accounts for 15.5 per cent of total land area and only 4.5 per cent of total land area of Indonesia. A large proportion of the oil palm plantations are also not newly felled forest but are old rubber plantations that have been converted to this more lucrative crop.
Many in the public know of my views which are critical of many developments in the country. However, praise needs to be given when it is deserved; and our home grown oil palm industry is one which deserves all our support. This support is important in view of the sustained criticism made against the oil palm industry by lobby groups that have their origin in the west.
Why We Should Support Our Oil Palm Industry
There are many good reasons to support our oil palm industry in Malaysia and Indonesia. These are some of the most important.
1. Firstly it is not only Felda settlers that are dependent on the crop for a livelihood. Malaysia’s annual US$25 billion (RM79.75 billion) palm oil exports support some two million jobs and livelihoods along the sprawling value chain. This means that one in every five working Malaysian is dependent for his or her livelihood on the crop.
2. Plantations have borne the brunt of the bad publicity. However, the small farmers are also affected. More than 40 per cent of oil palm planters in Indonesia are smallholders whilst in Malaysia they contribute to 38 per cent of the country’s palm oil output.
3. Environmental activist groups such as World Wildlife Fund, Friends of the Earth and Greenpeace have launched many campaigns alleging that the expansion of oil palm plantations have destroyed forests, threatened endangered wildlife and robbed indigenous peoples of their land. Many of their arguments are not based on fact but are sensationalized from a small and atypical number of cases.
4. The anti-oil palm lobby in the west includes pro-soya bean and rape-seed groups who see oil palm as a major competitor and have recruited food lobbyists to play on fears of the health hazards of palm oil consumption. . Together with environmental activists, these well-funded groups have created trade barriers to the global oil palm trade under the pretext of environmental activism.
5. In a fair contest amongst competing vegetable oils, palm oil will win hands down. The oil palm tree is the world’s most efficient oil crop because one can harvest five tonnes of oil per hectare. This is 10 times more productive than soya bean planted in the West, including United States and five times more productive than rapeseed, Europe’s main oil crop.
6. It is an undeniable fact that palm oil is the cheapest and most popular form of cooking oil for consumers, including many poor families in the west. Should trade barriers to benefit rapeseed farmers who are already heavily subsidised by the European Union (EU) government be successfully implemented, this will hurt consumers all over the world.
7. Also should alternatives to oil palm be grown, more land would be needed to produce an equivalent volume of oil to replace palm oil, resulting in more deforestation and problems for Mother Earth.
8. Oil palm smallholdings and plantations meet the United Nation’s Framework Convention on Climate Change which defines a forest as an area of 0.5 to one hectare having more than 30 per cent canopy cover and having a potential height of two to five metres. To accuse the industry in Malaysia and Indonesia of contributing to global warming is sheer nonsense. In fact oil palm trees just as with other forest species, produce oxygen for us to breathe and act to counter coal and oil emissions which are the major cause of global warming.
9. Finally, the western environmental activists’ campaign against oil palm plantation expansion, in the name of “saving rainforests”, is a violation of international norms and Malaysia’s and Indonesia’s sovereignty.
Conclusion: I trust all Malaysians will circulate this article to all their contacts to fight against the smear campaign against our palm oil industry and eventually I hope consumers, all over the world, will not buy soyabean or rapeseed oil which is more expensive and not really superior to palm oil.
Up_down Summary
of comparison between Jtiasa and TAAN. We can guess which company would
offer lower risks and faster rate of growth in future.
Jaya Tiasa
Weight average number of shares: 967,997,000
Palm oil segment:
Plantable area: 70,900 hectares
Planted area : 63,574 hectares
Mature area: 55,438 hectares
Immature area: 8,136 hectares ( 13% of Planted area )
Borrowing interest capitalized as Biological Assets: 22,567,000 (2013) 22,820,000 (2012)
Timber concessions with a total area of 713,211 hectares
Reforestation:
Total Land Area: 235,859 hectares
Estimated Plantable Area: 141,308 hectares
Planted Area: 30,978 hectares
PER: 79.7
Gearing ratio: 36.7%
Dividend Yield: 0.43%
Dividend declared in past 12 months : 1%
Average costs / hectare of biological assets : RM 21,000
Non amortization of Biological assets of 1.335 billion
TAAN
Weight average number of shares: 370,537,000 ( 38.3% of Jaya Tiasa )
Palm oil segment:
Land bank: 97,855 hectares
Planted area : 35,345 hectares
Mature area: 26,161 hectares
Immature area: 9,184 hectares ( 26% of Planted area )
Timber concessions with a total area of 362,439 hectares
Reforestation:
Total Land Area: 313,078 hectares
Planted Area : 33,000 hectares
PER: 23.7
Gearing ratio: 27.7%
Dividend Yield: 2.42%
Dividend declared in past 12 months : 10%
Average costs / hectare : RM 9,020
Amortization of Biological assets of 319 million over 25 years
Jaya Tiasa
Weight average number of shares: 967,997,000
Palm oil segment:
Plantable area: 70,900 hectares
Planted area : 63,574 hectares
Mature area: 55,438 hectares
Immature area: 8,136 hectares ( 13% of Planted area )
Borrowing interest capitalized as Biological Assets: 22,567,000 (2013) 22,820,000 (2012)
Timber concessions with a total area of 713,211 hectares
Reforestation:
Total Land Area: 235,859 hectares
Estimated Plantable Area: 141,308 hectares
Planted Area: 30,978 hectares
PER: 79.7
Gearing ratio: 36.7%
Dividend Yield: 0.43%
Dividend declared in past 12 months : 1%
Average costs / hectare of biological assets : RM 21,000
Non amortization of Biological assets of 1.335 billion
TAAN
Weight average number of shares: 370,537,000 ( 38.3% of Jaya Tiasa )
Palm oil segment:
Land bank: 97,855 hectares
Planted area : 35,345 hectares
Mature area: 26,161 hectares
Immature area: 9,184 hectares ( 26% of Planted area )
Timber concessions with a total area of 362,439 hectares
Reforestation:
Total Land Area: 313,078 hectares
Planted Area : 33,000 hectares
PER: 23.7
Gearing ratio: 27.7%
Dividend Yield: 2.42%
Dividend declared in past 12 months : 10%
Average costs / hectare : RM 9,020
Amortization of Biological assets of 319 million over 25 years
Up_down Jtiasa changed its accounting policies for Biological Assets since FY 2009.
Here is the explanation as stated in the annual report:
"With effect from 1 May 2008, planting expenditure incurred on newly developed land capitalised under plantation development expenditure is not amortised. Replanting expenditure of similar crops on former developed areas is chargeable to the income statement in the financial year it is incurred. In the opinion of the directors, the change in accounting policy provides reliable and more relevant information. This change in accounting policy has been accounted for retrospectively.
Upon maturity, all subsequent maintenance expenditure is charged to revenue and the capitalised pre-cropping cost is amortised on a straight line basis over 25 years, the expected useful life of oil palms. "
How the new policies affect (manipulate) financial performance ? Jtiasa makes profit 2.88 cents/ share in the rolling past 4 quarters. The amortization Biological Assets of Jtiasa is estimated base on the matured area amortized on a straight line basis over 25 years. The amount should have been amortized is RM 46,650,000. This will translate into 3.6 cents/share which is higher than the total profits in the past 4 quarters.
The companies would have shown higher profits not amortizing its Biological Assets:
Rsawit - RM 25,940,650 ( 0.95 cents/share )
SOP - RM 20,368,000 ( 3.4 cents/share )
TAAN - RM 10,975,000 ( 2.2 cents/share )
Here is the explanation as stated in the annual report:
"With effect from 1 May 2008, planting expenditure incurred on newly developed land capitalised under plantation development expenditure is not amortised. Replanting expenditure of similar crops on former developed areas is chargeable to the income statement in the financial year it is incurred. In the opinion of the directors, the change in accounting policy provides reliable and more relevant information. This change in accounting policy has been accounted for retrospectively.
Upon maturity, all subsequent maintenance expenditure is charged to revenue and the capitalised pre-cropping cost is amortised on a straight line basis over 25 years, the expected useful life of oil palms. "
How the new policies affect (manipulate) financial performance ? Jtiasa makes profit 2.88 cents/ share in the rolling past 4 quarters. The amortization Biological Assets of Jtiasa is estimated base on the matured area amortized on a straight line basis over 25 years. The amount should have been amortized is RM 46,650,000. This will translate into 3.6 cents/share which is higher than the total profits in the past 4 quarters.
The companies would have shown higher profits not amortizing its Biological Assets:
Rsawit - RM 25,940,650 ( 0.95 cents/share )
SOP - RM 20,368,000 ( 3.4 cents/share )
TAAN - RM 10,975,000 ( 2.2 cents/share )
03/02/2014 16:24
Does the Palm Oil Industry meet United Nation's Convention on Climate Change? Koon Yew Yin
Author: Koon Yew Yin | Publish date: Thu, 30 Jan 11:17Koon Yew Yin - 30th Jan 2014
What kind of men would cut down these ancient irreplaceable giants trees? Each of them was over one thousand years old. Over a period of a few decades around 1850, 95% of the two million acres of Redwood forest in California were cut and destroyed.
Now they say we are wrong to cut our trees to plant oil palms. What do they say when Brazil cut down their rain forest to plant soya beans? Let us examine the true situation.
Oil palm smallholdings and plantations meet the United Nation’s Framework Convention on Climate Change which defines a forest as an area of 0.5 to one hectare having more than 30 per cent canopy cover and having a potential height of two to five metres. To accuse the industry in Malaysia and Indonesia of contributing to global warming is sheer nonsense. In fact oil palm trees just as with other forest species, produce oxygen for us to breathe and act to counter coal and oil emissions which are the major cause of global warming.
Environmental activist groups such as World Wildlife Fund, Friends of the Earth and Greenpeace have launched many campaigns alleging that the expansion of oil palm plantations have destroyed forests, threatened endangered wildlife and robbed indigenous peoples of their land. Many of their arguments are not based on fact but are sensationalized from a small number of cases.
The anti-oil palm lobby in the west includes pro-soya bean and rape-seed groups who see oil palm as a major competitor and have recruited food lobbyists to play on fears of the health hazards of palm oil consumption. . Together with environmental activists, these well-funded groups have created trade barriers to the global oil palm trade under the pretext of environmental activism.
In a fair contest amongst competing vegetable oils, palm oil will win hands down. The oil palm tree is the world’s most efficient oil crop because one can harvest five tons of oil per hectare. This is 10 times more productive than soya bean planted in the West, including United States and five times more productive than rapeseed, Europe’s main oil crop.
It is an undeniable fact that palm oil is the cheapest and most popular form of cooking oil for consumers, including many poor families in the west. Should trade barriers to benefit rapeseed farmers who are already heavily subsidised by the European Union (EU) government be successfully implemented, this will hurt consumers all over the world.
Also should alternatives to oil palm be grown, more land would be needed to produce an equivalent volume of oil to replace palm oil, resulting in more deforestation and problems for Mother Earth.
Finally, the western environmental activists’ campaign against oil palm plantation expansion, in the name of “saving rainforests”, is a violation of international norms and Malaysia’s and Indonesia’s sovereignty.
Now I like to see those senseless critiques of my article "Why I sold R Sawit & SOP to buy Jaya Tiasa?" to make some intelligent comments. While I try to teach them to be super investors, they hide themselves behind pseudonym names like kk123 or wt222 to ridicule me. They are cowards.
Conclusion: I believe our palm oil industry will remain competitive and profitable for a long time. "Must Buy Jaya Tiasa" Don’t take it seriously. It’s a joke. I wish all the readers a happy and prosperous for the CNY, cheers!
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