Boustead a legacy with 179-year track record

Boustead a legacy with 179-year track record
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By LEONG HUNG YEE

BOUSTEAD Holdings Bhd, a conglomerate with investments in nearly every sector of the Malaysian economy, can trace its roots way back to 1828 when Boustead & Co was founded by British trader Edward Boustead in Singapore.

Since its inception 179 years ago as a modest trading entity, the Boustead group has grown by leaps and bounds. Today, it is one of the fastest growing corporations in Malaysia.

A filepic of an Affin Bank branch. Boustead has about 21% stake in Affins holdings Bhd, which owns Affin Bank Bhd.
Boustead, which is 64%-owned by Lembaga Tabung Angkatan Tentera (LTAT), has interests in various sectors, including plantation, trading, manufacturing, transportation, banking, insurance, shipping, construction, car rental, travel services, education and advertising.

The group has more than 80 listed and non-listed subsidiaries and associate companies. As at Dec 31, 2006 (FY06), the group had a paid-up capital of RM299mil while its shareholders’ fund stood at RM1.9bil.

Group managing director Tan Sri Lodin Wok Kamaruddin said Boustead is one of Malaysia’s oldest diversified conglomerates that can proudly trace its roots back to the 1800s.

“The entity was then a mere trading and shipping agency owned by shareholders who were mostly from Britain.

“Today, we are one of the country’s leading government-linked companies with LTAT as our major shareholder,” he told StarBiz.

For FY06, Boustead recorded a 52% jump in net profit to RM351mil from RM230mil in FY05.

Turnover stood at RM4.1bil against RM1.9bil in FY05. The group said its results were bolstered by performance in the fourth quarter, during which it recorded after-tax profit of RM270mil on turnover of RM959mil.

Lodin said the group currently has six core divisions – plantation, property, finance and investment, trading, manufacturing and services, and heavy industries – to drive its growth.

“The Boustead group boasts total assets in excess of RM4bil and more than 11,000 employees,” he added.

The plantation division has been, and is expected to continue to be, a major source of income for the group. Its main activities include planting and processing oil palm, rubber and cocoa, and operating oil-bulking installations.

Last year, the group bought two new mills, bringing a total of 11 mills in operation.

Boustead owns and operates The Royale Bintang Kuala Lumpur
Another significant driving force of the group’s growth is its property division, which oversees its large property holdings, real estate, resort development and construction activities.

Boustead owns a number of residential and commercial properties in major cities nationwide. Its property developments in Johor (Mutiara Rini) and Petaling Jaya (Mutiara Damansara) have been very successful.

Apart from its office towers, Wisma Boustead and Menara Boustead, the group also owns and operates two hotels – The Royale Bintang Kuala Lumpur on Jalan Bukit Bintang and The Royale Bintang Damansara in Mutiara Damansara.

The group’s comprehensive range of financial services has transformed Boustead into one of the major players in the fast-growing financial services sector and an active partner in the nation’s development.

This division adds an exciting new dimension to Boustead’s operations and is expected be a catalyst for stronger earnings growth.

Last month, the group announced plans to increase its stake in Royal & Sun Alliance from 35% to 80%. Boustead owns about 21% of Affin Holdings Bhd, which owns Affin Bank Bhd. It also has interests in Axa Affin General Insurance through Affin Holdings.

Boustead also has substantial interests in various manufacturing concerns, the most notable of which are UAC Bhd, Cadbury Confectionery Malaysia Sdn Bhd, Boustead Sissons Paints Sdn Bhd and Idaman Pharma Manufacturing Sdn Bhd.

The completion of the acquisition of a 70% stake in BP Malaysia Sdn Bhd signalled Boustead’s entry as a significant player in the downstream petroleum retail sector.

Boustead aims to grow this business further by tapping synergies within the group, expanding its network of petrol stations and stepping up its loyalty programme to secure more recurring customers.

Boustead’s shipping operation, which started in 1933, has emerged as one of the largest networks of branches in Malaysia.

Its shipping business encompasses shipping agencies for liner services, both containers and conventional, cruise ships and trampers; warehousing and forwarding; flexitank operations; ship management; brokerage and chartering; and marine cargo surveying.

Despite having been in the business for almost two centuries, the Boustead group would continue to strengthen its name and keep abreast of the latest developments, Lodin said.

“We will continue to seize opportunities and build on our existing track record. We recently undertook a series of strategic corporate initiatives across our core divisions to sustain positive long-term growth and enhance shareholders' value.

“With our low gearing and strong shareholders’ funds, we are confident the group will remain stronger many decades down the road,” Lodin said, adding that Boustead was always on the lookout for synergistic business opportunities to complement its existing portfolio of businesses.

Its financial stability, sound management practices and broad technical expertise give the group an edge in today’s increasingly competitive corporate environment.

Boustead offers existing and potential partners the strength of its corporate name, backed by more than 170 years of excellent track record and solid business expansion.