Latest news with #TaAnn
The Star
26-05-2025
- Business
- The Star
Ta Ann expects higher demand for plywood
KUCHING: Ta Ann Holdings Bhd is seeing a rebound in demand for its plywood products in the key Japanese market. The company reported a recovery in demand since late March amid the low plywood inventory levels in Japan. In the January to March quarter (1Q25), the group 's plywood exports plunged by 48% from a year ago. The recovery in plywood demand from Japan has resulted in greater operational efficiency and a leaner cost structure, enabling the group to maintain competitive pricing, said Ta Ann after releasing its 1Q25 financial results last week. Group managing director Datuk Wong Kuo Hea said in the company's annual report for last year that with Japan's infrastructure rebuilding efforts gaining momentum, the company anticipates a resurgence in plywood demand. He said the group's plywood business had experienced a significant setback since 2023, with demand from its primary export market, Japan, remaining sluggish due to ongoing economic headwinds. These include the lingering effects of the Covid-19 pandemic, negative population growth and an earthquake early last year. The weak market demand impacted Ta Ann group's Malaysian plywood production which shrank by 19% to 49,891 cubic metres (cu m) last year from 61,642cu m in 2023. Year-on-year, the group's plywood sales volume contracted by 24% to 52,138cu m from 68,784 cu m. In both 2023 and 2024, the group exported 99% of its plywood to Japan and the remaining 1% to Australia. In responding to the weak demand, Wong said the group had adjusted jits production to align with market demand and implemented various strategies to adapt to the evolving situation. These measures include enhancing productivity while ensuring product quality and maintaining regular communication with Japanese buyers to swiftly address market changes. 'Our dedication to sustainable forest management continues to provide a competitive edge for our key product – coated concrete plywood – which is fully Programme for Endorsement of Forest Certification-certified,' he said. Besides Malaysia, the group's Tasmanian operation in Australia also manufactures plywood products for the local market there. 'The availability of skilled workers remains the primary challenge for our Tasmanian operations. Despite this, management is focused on enhancing workforce productivity and adopting lean-manufacturing practices to ensure operational sustainability. 'Since consolidating our resources at the Smithton Mill in northern Tasmania in 2021, we have prioritised optimsing resources utilisation and implementing prudent cost management strategies to improve efficiency. 'By maintaining stringent cost control, we have successfully maintained our competitive position in the Australian market,' he added. Ta Ann manages three active forest management units in Sarawak's Rejang region covering 346.021ha.
Borneo Post
23-05-2025
- Business
- Borneo Post
Ta Ann's 1QFY25 hurt by timber losses
Ta Ann's 1QFY25 FFB production rose 7.6 per cent per cent y-o-y to 136,800MT. Overhead extraction rate (OER) fell from 19.67 per cent to 19.26 per cent. KUCHING (May 23): Excluding net realised forex gains and minority interests, Ta Ann Holdings Bhd (Ta Ann) kicked off its first quarter of financial year 2025 (1QFY25) with a core profit of RM40 million. The results, down by 4.3 per cent year on year (y-o-y), were slightly below Public Investment Bank Bhd's (PublicInvest Research) expectations, but were within the street's expectations, making up 19 and 22 per cent, respectively. The weaker earnings, down RM41.8 million to RM40 million, were mainly dragged by the timber losses, as it reported a fourth straight quarterly loss of RM5.2 million. 'Sales increased from RM352 million to RM407 million, attributed to higher plantation sales but partially offset by weaker timber sales,' it analysed in its notes. 'Timber revenue tumbled 52 per cent y-o-y to RM28.6 million as log sales sank 53 per cent y-o-y to RM7.5 million while plywood sales nearly halved to RM21.7 million, as bad weather had affected logging activities. Notably, 1QFY25 average log export price enhanced from US$223 per cubic metre (cu m) to US$225 per cu m while plywood price dropped from US$530 per cu m to US$471. Log and plywood export volume tumbled 50.4 and 49.1 per cent, respectively. On the other hand, palm oil sales increased by 29.2 per cent y-o-y to RM377.7 million. 1QFY25 average CPO price surged from RM3,884 per metric tonne (MT) to RM4,825. Meanwhile, Ta Ann's 1QFY25 FFB production rose 7.6 per cent per cent y-o-y to 136,800MT. Overhead extraction rate (OER) fell from 19.67 per cent to 19.26 per cent. Meanwhile, earnings contributions from its subsidiary, Sarawak Plantation Bhd, and joint venture-owned refinery rose 15.5 per cent y-o-y to RM7.6 million. The heavy rainfall in the first two months had affected logging and palm oil activities, PublicInvest Research said. as FFB production was 20 per cent below expectation. 'For FY25, management targets FFB production growth of 16 per cent y-o-y to 770,000MT based on FFB yield of 18MT per ha. 'This year, it plans to replant another 3,000ha. Fertiliser application has reached 25 per cent of the full-year target. Meanwhile, it also targets log production of 180,000 cu m, with 94 per cent coming from natural forest. 'Despite lower log supplies, plywood production is expected to increase from 51,000 cu m to 72,000 cu m, led by increased third-party purchases. The demand for logs remains steady in India, while there is an urgent demand for plywood due to Japan's current low inventory level. 'The company has no forward sales policy in place, hence, we expect the realised CPO prices for the coming quarters to reflect the prevailing level of less than RM4,000 per MT. 'Lastly, management plans to allocate capex of RM56 million for FY25, with RM45 million allocated for plantation and RM11 million for timber, respectively.' financial year first quarter ta ann
