Should this be your first encounter with ANJ Agri, I would like to personally extend a warm welcome to you.
With the persistently high oil prices and possible global threats such as terrorism, riots, epidemic diseases and drastic weather patterns affecting agriculture production, we can expect the global economy to remain challenging in 2011.
PT ANJ Agri has constantly faced numerous challenges in our pursuit of business excellence and we see this as an opportunity to leverage on our strong track record of business acumen and experiences to remain competitive and innovative.
I am proud to see that we continue to grow our Company with excellent fundamentals, while further developing and expanding our technology into the Sago and Renewable Energy Sectors. We aim to become a world class Sustainable Food & Energy Company in keeping up the global challenges of providing sufficient food & energy for the ever-expanding world.
For the Financial Year 2010, ANJ Agri has achieved yet another encouraging record and has realized an EBITDA Margin of 55%.
We are very pleased by the consistently High Oil Extraction Rates that we have achieved at our plantations, which is above the rates that most Malaysian and Indonesian companies have achieved.
In spite of the constant increase in Production Cost, we have ended up with a CPO Cash Costs of $277/ton for Financial Year 2010. Prudent spending and higher productivity across the board has certainly produced the excellent results above. For that we are grateful. Our goal has never been to be the largest plantation company but only to be one of the most profitable players in the Industry.
The Industry Dynamics remain promising with the ever increasing World’s demand for Palm Oil spurred even further by Bio-diesel requirements.
ANJ Agri is well placed to take advantage of this scenario with 32,500 ha of Planted Area, of which 89% of those areas are matured. By the end of 2011, we are hoping to have have planted a further 4,500 ha within our plant-able land bank, thus enlarging our Planted Area to 36,500 ha.
We fully acknowledge that today’s businesses operate in an era dominated by new technologies. Our success in perpetuating the continued well-being of an old-aged industry like ours hinges very much on our capability to embrace new technologies to our advantage and to successfully apply methodical and scientific approaches to all aspects of our operations in order to optimize the returns for all stakeholders.
We have embarked on a large scale Commercial Sago Production through our ANJ Agri Papua, with a land bank of 40,000ha under the IUPHHBK License. Currently, we have already reached the stage of planning for our first 3,000 tons/month Sago Starch Factory in the Mentamani District of Sorong Selatan Regency, West Papua. Our factory is expected to start commercial production in 1st Quarter 2013.
In ANJ Agri Belitung [PT Sahabat Mewah dan Makmur], we have already introduced mechanized collection and evacuation of the Fresh Fruit Bunches (FFB). The proven system is very cost effective as it delivers FFB from the Estate Fields to the Mill and then returning the Empty Fruit Bunches (EFB) back to the fields. This in turn reduces handling, turn-around time and above all, reduces transport costs.
We have also recently introduced Mechanized Harvesting using the Motorized Cutter, whereby each harvester is capable of increasing their daily productivity from 200 to 500 bunches.
We are very proud of being the 14th Company in Indonesia to be awarded the RSPO Certificate to produce approximately 65,000 tons CPO in 2011.
Another great achievement is the commissioning of our first small scale BioMass Pilot Plant at the ANJ Agri Belitung site which has proven to generate 60kw Electricity Power Supply for our Staff & Workers’ Quarters.
We have also successfully registered our BioGas Product Design Document (PDD) with UNFCCC for our first Methane Capture Project in Belitung. The construction is in progress and we expect the plant to be commissioned in 4 th Quarter 2011 with Gas Flaring. Thereafter, we shall follow through the next steps of getting the Certified Emission Reduction (CER) certificates.
ANJ Agri Siais [formerly PT. Ondop Perkasa Makmur] is very special to us, being the first green field project of 8,000 ha for the Group. We have successfully completed planting up to 7,927 ha, completely in full compliance of Environmental Conservations. with the best quality planting materials & good soil.
We are very proud to have successfully commissioned the 1st Fully Automated 60 Tons FFB per Hour Palm Oil Mill in the Indonesian Palm Oil Industry. With all these achievements, Siais will become the ‘jewel in the crown’ for our group, when the whole estate fully matures.
We have recently opened up PT. Kayung Agro Lestari (KAL) in 2010 and have planted 744 ha of palm trees. This will be our 2nd green-field project of 17,855 ha of forest release decree located in Ketapang, West Kalimantan. We expect to plant up another 4,500 ha in 2011 and also participate actively in the REDD Scheme [Reducing Emission from Deforestation and forest Degradation].
As part of the Austindo Nusantara Jaya Group, we have adopted the ANJ Values as our Corporate Culture. We have been practicing ‘Leadership by Example’, with greater transparency and accountability at all levels of management, strictly in line with the three ANJ Core Values, namely; Integrity, Respect for People and Environment and Continuous Improvement. All our operating units have implemented the Environmental Health and Safety Procedures very successfully over 5 years now as one of our ongoing commitments.
Last but not least, we would like to ensure sustainable growth for ANJ Agri while maintaining an EBITDA Margin of 50%+, inspite of the anticipated fuel and wage increases coupled with the tough challenges ahead in 2011.
I am confident that in the long term we can operate profitably and maintain our present business fundamentals.
In this opportunity, I would like to acknowledge and thank our shareholders, buyers, suppliers and employees who have supported and continue to support our Company.
Koh Beng Hock
Chief Executive Officer