GOLDEN AGRI CORPORATION: HISTORY AND SWOT ANALYSIS

Golden Agri Corporation: History and SWOT Analysis



Golden Agri Corporation: History and SWOT Analysis

Introduction

Golden Agri Corporation (GAC) is a diversified group which through its subsidiaries is engaged in the cultivation of oil palm and rubber, property development and investment, landscaping services, and general contracting. The group primarily operates in Europe, Malaysia, Asia and North America. It is headquartered in Putrajaya, Malaysia and employed about 30,000 people as of June 30, 2008. The group recorded revenues of MYR14,665.4 million (approximately $4,438.2 million) during the financial year (FY) ended June 2008, an increase of 63.8% over FY2007. The operating profit of the group was MYR3,172 million (approximately $959.9 million) during FY2008, an increase of 54.1% over FY2007. The net profit was MYR2,231.6 million (approximately $675.4 million) in FY2008, an increase of 50.6% over FY2007.

Kowalski & Kryder (2002) mentions GAC a palm oil plantation group engaged in a range of activities and services, including the cultivation and processing of oil palm and rubber, property development and investment, landscaping services, general contracting and others.The group operates through a network of more than 100 companies, which are either part-owned or fully-owned by GAC (Kowalski & Kryder, D., 2002). Its core businesses are located in Malaysia. The group also has manufacturing facilities in the Netherlands, the US, Malaysia, Egypt and Canada, and sales offices in eight other countries with sales to more than 85 countries worldwide. The group operates through five business segments: resource-based manufacturing, plantation, property development, property investment and other operations.

The resource based manufacturing segment comprises mainly manufacturing and related activities ranging from basic processing such as refining, to downstream processing of palm oil into oleo-chemicals and specialty oils and fats. Crude palm and palm kernel oils from the group's upstream mills are channeled to its refineries located at origin and at destination. The refined oils are then sold externally or channeled internally for further value-add processing in its oleo-chemicals and specialty fats manufacturing facilities (Kowalski & Kryder, D., 2002). The segment serves customers in more than 65 countries globally. Crude palm oil and palm kernel oil are used in various industries including food, personal care, households, pharmaceutical, cosmetics and chemical industries. The group's oleo-chemicals business is undertaken through 100% owned subsidiary, GAC Oleo-chemical Industries (GAC Oleo) as well as newly acquired wholly owned Pan-Century group of companies.

1- Financial Ratios

Financial ratios are calculated from one or more pieces of information from a company's financial statements. For example, the "gross margin" is the gross profit from operations divided by the total sales or revenues of a company, expressed in percentage terms. In isolation, a financial ratio is a useless piece of information. In context, however, a financial ratio can give a financial analyst an excellent picture of a company's situation and the trends that are developing.

A ratio gains utility by comparison to other data and standards. Taking our example, a gross profit margin for a company of 25% is meaningless by ...