KUALA LUMPUR (Dec 21): TDM Bhd’s unit has entered into a 36-month agreement to supply crude palm oil (CPO) and/or RSPO certified CPO to Ikhasas CPO Sdn Bhd, with the latter providing an upfront payment of RM70 million.
Throughout the supply period, TDM’s wholly-owned subsidiary TDM Plantation Sdn Bhd is required to deliver 900 tonnes of CPO per month to Ikhasas, which is 75% owned by Liquid Palm Sdn Bhd and 25% by Y&L CPO Sdn Bhd.
Ikhasas’ directors are Tan Chee Kian, Tan Jyh Yaong, Wong Kiew, Ngabdul Malik Md Ngaridi and Kee Sock Kheng, according to TDM’s stock exchange filing on Thursday.
TDM, which is 60%-controlled by the Terengganu state government via its strategic investment arm Terengganu Inc Sdn Bhd, said it will spend RM30 million of the upfront payment for capital expenditure for its plantation business with the remaining RM40 million for working capital.
In the first nine months ended Sept 30, 2023 (9MFY2023), TDM incurred a bigger net loss of RM25.3 million, increasing more than six times from RM3.89 million a year earlier, while revenue contracted 7.1% to RM423.75 million from RM456.31 million in 9MFY2022.
Its performance in 9MFY2023 was mainly weighed by its plantation businesses, which were affected by lower palm oil prices.
Shares of TDM closed half sen or 2.9% higher at 18 sen on Thursday, giving it a market capitalisation of RM310.12 million.