KUALA LUMPUR, Dec 2 — A subsidiary company under the Plantation Industries and Commodities Ministry recorded losses for five consecutive years, has the highest increase in liabilities and the second highest negative returns on equity, out of 62 subsidiary companies, according to the third series of the 2012 Auditor-General’s (A-G) Report.
Forest Plantation Development Sdn Bhd is a special vehicle for the Malaysian Timber Industry Board, which falls under Datuk Seri Douglas Unggah Embas’ ministry.
According to its website, the company, which was set up in February 2006, was tasked to “promote, support and manage funding facilities from the government for the establishment of commercial forest plantation in Malaysia”.
According to the A-G’s Report, TH Bakti Sdn Bhd, UM Holdings Sdn Bhd, Malaysia Institute of Aviation Technology Sdn Bhd and Pembinaan Perwira Harta Sdn Bhd also recorded losses five years in a row.
Forest Plantation, however, recorded the highest losses before tax from 2008 to 2011, only to be taken over by TH Bakti at -RM4.03 million in 2012.
The company also has the highest increase in liability from RM260,000 in 2008, to RM209.46 million.
“The audit analysis found Forest Plantation Development Sdn Bhd has the highest balance in loans at RM209.20 million in 2012, followed by UMP Holdings Sdn Bhd with the amount RM180.98 million,” the report said.
The company also has negative earnings before interest, taxes, depreciation and amortization (Ebitda), from -RM1.22 million in 2008, gradually increasing to -RM6.92 million. Ebitda is a measurement of a company’s financial performance.
The company also has the second highest negative returns on equity (RoE) at -RM11.1 million after TH Bakti Sdn Bhd at -RM23.7 million.
Forest Plantation, however, has the highest increase in assets from RM7.97 million in 2008 to RM221.18 million last year.
The A-G’s report generally found a decline in subsidiary companies’ income with five companies experiencing losses, two companies seeing a reduction in assets, and 10 companies having increased liabilities.
Meanwhile, four companies showed a decrease in funds, four companies showed a shortage in funds, three companies showed a decline in Ebitda and four companies show the ratio of return on equity is negative.
The report also found that nine subsidiary companies and four sub-subsidiary companies have experienced profit five years in a row but did not pay dividends to the holding company.
