Settlers lost RM177 million from Felda Global, says Pua

Felda Global Ventures Holdings Bhd, the world’s third largest oil palm plantation operator, performed badly on the share market yesterday. DAP MP Tony Pua says settlers who still have shares with the state-controlled planter will lose an estimated RM177 million. – The Malaysian Insider pic, April 8, 2015.

The 94,125 settlers who still have shares in Felda Global Ventures Holdings (FGVH) have lost a total estimated RM177 million, DAP MP Tony Pua said today, citing the market closing price of RM2.09 per share yesterday.

He said the government revealed yesterday that 99.9% of the 94,219 settlers who bought their allocated 800 shares in FGVH at RM4.45 in 2012 still held on to their shares.

“Unfortunately, these settlers who held on to their shares would have lost an estimated total of RM177 million based on yesterday’s market closing price of only RM2.09 per share.

“This is the result of a 53% drop in the share price over the past two years,” Pua told a press conference at the Parliament lobby.

“The shares have performed disastrously despite a strong performance by the Kuala Lumpur Composite Index (KLCI) which appreciated from 1,599 to 1,855 points (16%) over the same period.”

The Petaling Jaya Utara MP said FGVH performed embarrassingly despite support from the Employees Provident Fund (EPF), Pensions Fund (KWAP), Lembaga Tabung Haji as well as state funds.

In a parliamentary written response yesterday, the Prime Minister’s Department said the “FGVH performance is still on the right track to achieve the targets which have been set”, and that operational profits increased by 10% for 2014 to RM1.03 billion.

It also said the group’s revenue increased by 30.8% to RM16.4 billion while gross profits leaped to RM2.14 billion.

But Pua said today the response was a “clear case of denial syndrome”, as the 30.8% increase in revenue was achieved due to higher average crude palm oil (CPO) prices and consolidation of revenue from newly acquired plantations.

He said despite the revenue, FGVH’s net profit of the year plunged by 52.7% from RM1.16 billion in 2013 to RM0.55 billion in 2014.

According to “profit attributable to owners of the company”, FGVH’s basic earnings per share was lower by 68.8% from 26.9 sen to 8.4 sen over the period.

“There is not a single investment bank in Malaysia which rated FGVH as a ‘buy’ stock, despite its current lowly prices,” said Pua.

“The balance sheet of FGVH does not look any healthier. The cash holdings in the company have reduced significantly from RM5.03 billion to RM3.67 billion, while the company remains heavily indebted with its borrowings having increased from RM4.35 billion to RM4.63 billion.”

He said Prime Minister Datuk Seri Najib Razak should act to reverse the company’s fortunes, while FGVH’s top management and chairman, Tan Sri Isa Samad, should be held accountable.

- TMI