QL Resources Berhad (428915-X)
22
GROUP MANAGING DIRECTOR’S REPORT
GROUP STRATEGY AND OBJECTIVE
For the financial year under review, QL Resources Berhad contended
with market conditions that tested our strategy and resilience. From the
full impact of Goods and Services Tax, weak Ringgit, low crude palm
oil (CPO) prices to labour shortage and the El-Nino weather effect, the
situations were at times both a boon and a bane simultaneously.
Notwithstanding these factors, cash flow was again strong this year.
Net debt ratio at financial year-end improved from 37.1% to 31.3%. With
the group’s cash generating ability, the lower net debt and the
committed borrowing facilities available, we have the capacity to meet
our growth objective.
For FY2016, we continue to focus on our three-pronged strategy
embarked on five years ago with the objective to produce double digit
earnings CAGR (compounded annual growth rate) up to year 2020.
The essence of QL’s three-pronged strategy are:
•
Regional replication
Replicate core activities and value chain in major Southeast Asian
markets such as Indonesia and Vietnam.
•
Strengthening value chain
Continue to grow through adjacency in core value chains via
upward and downward integration to strengthen competitive
position; areas identified include aquaculture, commercial feed
milling and broiler integration activities.
•
Downstream integration in consumer food
Focus on consumer food business expansion, to become a
consumer food company and increase consumer brand position
and channel access. The move to expand downstream into
FamilyMart convenience store chain is a strategic step into
another long-term, scalable business supported by growing
consumer and social trends. This is an extension of QL’s food
business.
