KUALA LUMPUR (June 18): Priceworth International Bhd reported a 300% year-on-year jump in log production in May this year to a record high, thanks to contribution from its operations in the timber concession area FMU5, in Sabah.

Log production grew to 33,635.62 cubic metres from 8,375 cubic metres in the same month last year, Priceworth said in a statement. Month-on-month, it is a 2.5% improvement from April's 32,800.72 cubic metres.

In a related stock exchange filing, Priceworth said the stable production volume was mainly attributed to satisfactory weather conditions and improved efficiency in harvesting and expanding operations in FMU5.

FMU5 represents Forest Management Unit 5, and comprises a net concession area of 88,920ha of commercial class II forest in Sabah’s Trus Madi forest reserve, according to Priceworth. "We expect the production to further improve in the coming months, with increased productions from compartments 63 and 64 of FMU5," Priceworth added.

Priceworth posted a six times year-on-year jump in its net profit for the nine-month ended March 31, 2018 (9MFY18) to RM10.3 million from RM1.64 million, which it attributed to stable supply of timber from FMU5.

Meanwhile, Priceworth said it has extended its cash option to acquire timber concession area FMU5 in Sabah at a discounted RM235 million, until July 31, 2018.

"The cash options represents a discount of RM25 million on the original RM260 million purchase price for FMU5 to RM235 million, which has been valued at RM433.8 million," Priceworth said.

The forest management group inked an eight supplemental letter today to extend cash option with vendor Transkripsi Pintar Sdn Bhd. It originally inked the sale and purchase agreement to buy FMU5 in October 2016.

It is acquiring FMU5 via its Singapore unit GSR Pte Ltd, which is also acquiring sister company Sinor Sdn Bhd — Priceworth's plywood manufacturing arm. Priceworth plans to list GSR on the Singapore Exchange.