19 November 2019

KONTAN.CO.ID - JAKARTA. Crude palm oil (CPO) producer PT Mahkota Group Tbk (MGRO), through its subsidiary, PT Berlian Inti Mekar officially acquired a palm oil mill (PKS) owned by PT Mahkota Andalan Sawit as of November 8, 2019. The purchase value of factory assets located on Jl. Lintas Palembang-Muara Enim Km. 54, South Sumatra, reached IDR 120 billion.

The assets purchased also include all facilities and infrastructure supporting the factory. Starting from machinery, factory inventory, offices, vehicles, to heavy equipment. This acquisition fund comes from bank loans by MGRO subsidiaries.

MGRO Corporate Secretary Elvi said, this acquisition had a positive impact on MGRO both in terms of operations and finance because it was purchased by a subsidiary that was consolidated with MGRO.

“With the processing capacity of FFB (fresh fruit bunches) per hour and CPO / PK production which is relatively the same as our other factories, of course the amount of revenue and profit consolidated in MGRO will also increase,” he said when contacted by Kontan.co.id, Friday (11/15).
 
Please note, the acquisition of this plant is part of MGRO's business plan to increase product downstreaming. The reason is, this palm oil mill which has a production capacity of up to 45 tons of FFB per hour can increase the supply of CPO to support the refinery plant that MGRO is developing in Dumai, Riau.

This refinery plant will produce CPO derivative products such as Olein or cooking oil, strearin, margarine raw materials or oleochemicals with a cooking oil production capacity of 1,500 tons per day.

Taking into account the contribution of this newly acquired plant, until the end of 2019, MGRO targets revenue to increase 183% on an annual basis to IDR 5.66 trillion. In 2018, MGRO recorded revenue of IDR 2 trillion, up 13.6% year on year (yoy).

MGRO's aggressive target this year is supported by contributions from refinery sales which are estimated to reach 40% of revenue. Even so, as of September 2019, MGRO's revenue had only reached IDR 1.37 trillion, down 6.8% compared to the same period in 2018.

In 2019, MGRO will also boost its CPO production target to 203,308 tons. This figure is up 4.95% from the 2018 target of 193,715 tons. Even so, the realization of 2018 was higher than the target, which was 219,149 tons. 

For next year, MGRO projects that full-year revenue and net profit growth will continue. “From the projection calculation, the company expects an additional approximately 12.5% for consolidation to MGRO's revenue and profit in 2020,” said Elvi.

Source : https://investasi.kontan.co.id/news/mahkota-group-mgro-resmi-akuisisi-pks-begini-dampaknya-ke-bisnis-perseroan