Anwar Sierad to invest Rp 77b in new projects

JAKARTA (JP): PT Anwar Sierad, an integrated poultry producer and an animal feed manufacturer, will spend around Rp 77 billion (US$36.6 million) in the next three years for expansion.

Budiarjo Tek, the company's president, said yesterday that the company will install a new production unit at its feed mill in East Java this year.

The installation of new production facilities, which will cost the company around Rp 30 billion, will double the production capacity of the feed mill to around 80 tons per hour, he said.

Budiarjo said the company is also preparing the construction of a new feed mill and a corn drying plant in Lampung. The two factories will cost the firm, listed on the Jakarta and Surabaya exchanges, Rp 20 billion.

The new projects are part of the investment program promised to investors during the company's public offering late last year, he said, adding that the other projects include the construction of three breeding farms, a fishmeal plant and an animal pharmaceutical factory. Those projects would cost the company around Rp 27 billion.

He said that most of the funds to be used for the expansion projects were raised from the company's public offering last year.

Anwar Sierad, which produces around 60 tons of animal feed per hour from its feed mills in West and East Java, recorded an increase in its sales last year to Rp 139 billion from Rp 127 billion in the previous year. The company's net profits also increased by over 50 percent to Rp 14.16 billion from Rp 9.15 billion. The net earnings per share rose to Rp 518 from Rp 458.

Budiarjo said the company's sales are projected to increase by over 50 percent this year due to greater efficiency at the existing feed mills.

He refused to disclose the company's profit projections but said that earnings are expected to continue growing in the next three years as the result of the company's massive expansion.

Budiarjo also explained the appointment of Fadel Muhammad as chief commissioner of Sierad Feedmill, the company's subsidiary.

He said that Fadel, the chairman of the Bukaka business group, will buy a portion of the subsidiary's shares but he refused to elaborate.

"The deal is still under negotiations," he said, adding that the entry of Fadel to the company's supervisory board is important not only because of his equity participation but more on his good relationship to the government. (hen)