KUALA LUMPUR (Sept 22): Fima Corp Bhd plans to increase plantation profit contribution to 50% from 40% as the group eyes oil palm tracts in Sabah and Sarawak.

Fima group managing director Roslan Hamir said the company hoped to achieve the 50% plantation profit contribution within five years. The move will equalise the company’s security printing and plantation bottom line, according to him.

“Eventually, our target is to reach 50:50 within five years, 50% for printing and 50% for plantation in terms of bottom line,” Roslan told reporters after Fima’s annual general meeting here today.

Fima posted a higher net profit of RM15.15 million in the first quarter ended June 30, 2015 from RM14.33 million a year earlier.

Roslan said the group was always looking for oil palm land acquisition opportunities in Peninsular Malaysia, besides Sabah and Sarawak.

Fima, which already owns tracts in Peninsular Malaysia and Indonesia, does not have any oil palm sites across Sabah and Sarawak.

In Peninsular Malaysia, he said the group had 2,800ha; and in Indonesia, the company owns 6,500ha.

Fima’s plan to grow its plantation unit comes at a time when the company, which is also Malaysia’s only banknote printer, is contending with limited growth prospects in its security printing division.

Roslan said security printing growth was limited due to stiff competition. He said that 5% of Fima’s security printing revenue was derived from abroad, where expansion was not easy.

“It’s more difficult as there are a lot of big players out there. They have been in the market for a long time and some other countries have their own state printers. Their preference will be their own state printers.

“The margin is very small and the cost of marketing is too high,” Roslan said.

At 3:51pm, shares in Fima traded unchanged in RM2.32 for a market capitalisation of RM555.41 million. The stock saw 23,700 shares done.

(Note: The Edge Research’s fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)