KUALA LUMPUR: Timber-cum-plantation group Jaya Tiasa Holdings Bhd, controlled by the family of Tan Sri Tiong Hew King, has proposed a new placement of 42.04 million shares or 15% of its issued and paid-up share capital to raise some RM300 million.
In a separate statement yesterday, the company also announced the distribution of 13.35 million treasury shares as share dividends on the basis of one treasury share for every 20 existing shares, and a proposed 2-for-1 bonus issue of new Jaya Tiasa shares.
The proposed placement exercise is expected to raise some RM299.8 million, assuming full subscription at an issue price of RM7.13 per share based on a five-day volume-weighted average market price. Jaya Tiasa closed 19 sen higher to RM7.69 yesterday.
“The proposed placement will enable the Jaya Tiasa group to further strengthen its financial position statement. As at Jan 31, 2012, the group had total borrowings amounting to about RM895.14 million, the majority of which was incurred for capital expenditure and working capital.
“The proposed placement will reduce the gearing of the group thereby providing flexibility for fund raising as and when the opportunity arises. In addition, the repayment of some of the group’s existing borrowings will give rise to interest cost savings,” it said.
Yesterday, Jaya Tiasa also reported a 14.11% rise in its net profit to RM45.52 million or 17.05 sen for 3Q ended Jan 31, compared with RM39.89 million a year ago, as the fall in average selling prices of logs, fresh fruit bunch (FFB) and crude palm oil (CPO) partially mitigated the increase in production.
For 3Q, the group recorded a flat revenue of RM237.56 million against RM237.65 million previously.
For the first nine months of its financial year, the group’s revenue was up by 19.77% to RM737.08 million from RM615.39 million a year ago. Meanwhile, net profit jumped 54.3% to RM142.59 million from RM92.42 million on the back of improved FFB, CPO and plywood sales as well as average selling prices during the longer period.
In a separate note, Jaya Tiasa said its wholly-owned subsidiary, JT Oil Palm Development Sdn Bhd (JTOP) signed an agreement with GenPower Carbon Solutions LP (GPCS), for a biogas clean development mechanism (CDM) project yesterday.
Under the agreement, JTOP will provide a site at the JTOP CPO mill at Pulau Bruit, Sarawak, while GPCS will develop a concrete tank bio-digester system.
GPCS will invest in the equipment to trap and monitor greenhouse gas emissions generated from anaerobic digestion of the effluent. The trapped gas will then be supplied to the mill as clean and renewable fuel for energy generation.
GPCS will undertake the responsibility to qualify the project under CDM requirements and to verify and market the carbon credits.
This article appeared in The Edge Financial Daily, March 23, 2012.
