Thursday, June 10, 2010

Premium targets RM200m worth of contracts this year

KUALA LUMPUR: PREMIUM NUTRIENTS BHD [], which produces edible oils and fats, and animal feed, is targeting RM200 million worth of contracts over the next six months.

Its CEO and group managing director T T Rajah said the contracts would be procured from its existing customers as well as new ones from the Middle East and the Commonwealth of Independent States, comprising former Soviet republics.

Its existing clients include food manufacturers Cadbury plc, Nestle SA, Kraft Foods Inc and Kerry Ingredients (Malaysia) Sdn Bhd, and edible oil product manufacturer Bunge Ltd (Canada).

This is part of the group's new business strategy towards strengthening its position in its existing markets by venturing into more niche, higher profit-margin products such as healthier, trans-fat-free foods.

"We are gaining market share in the US (through the group's trans-fat-free products), and the future is good," Rajah told reporters after the group's AGM here on Wednesday, June 9.

The group currently exports more than 95% of its products to about 55 countries, according to its website.

Meanwhile, to expand its operations, Premium Nutrients will invest another RM10 million this year in its Malaysian plants to produce new products and boost sales, Rajah said.

Since the beginning of the year, the group had invested RM15 million in its Malaysian facilities, he said.

He said the group had been hitting the targets set for its Malaysian operations, including producing a total of up to 20,000 tonnes of food products a month.

On its Indian operations, Rajah said it had invested RM15 million this year in a factory under its unit Arani Agro Oil Industries Ltd (AAO), enabling it to transform into a producer of niche food products with higher margins and leverage on the trend towards consuming healthy, trans-fat-free edible oil and food products.

Post-upgrade, Rajah said the plant in India was able to produce up to 10,000 tonnes of edible oils and fats from 9,000 tonnes previously.

He said the group saw various opportunities in the constant growth of the food industry, including specific areas such as baked products, and specialty fats that address health concerns.

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