DBE sees tastier prospects with HARUMi expansion
DBE Gurney diversifying downstream, plans to open more outlets in Klang Valley
DBE Gurney Resources Bhd sees brighter prospects in the Year of the Rooster as it opens more HARUMi fastfood outlets in Klang Valley, following a solid presence in Perak.
“DBE Gurney is diversifying downstream. We want to transform ourselves into a food and beverage group to reap better valuation,” said group managing director Datuk Alex Ding Seng Huat.
“We are aiming for higher profit margins from the business of just farming and processing live poultry. We’re moving up the value chain from just being a farmer to become a more service-oriented business entity,” he told NST Business in an interview, here.
In April last year, DBE Gurney signed a partnership agreement with a group of Taiwanese investors. HARUMi, Malaysia’s halal-certified local fried chicken brand, is born out of the collaboration to offer licensing opportunities for young entrepreneurs in the food and beverage industry.
So far, this downstream venture has helped DBE Gurney get back into the black after reporting losses for 12 years. Last year, DBE Gurney posted a RM250,000 net profit compared with a RM10.75 million loss in 2015. This was on the back of a 5.5 per cent drop in revenue to RM112.98 million, from RM119.55 million in 2015.
Ding said the Taiwanese investors in HARUMi planned to buy a key stake in DBE Gurney within two years.
Asked if HARUMi was in direct competition with Kentucky Fried Chicken (KFC), Ding said its business relationship with the giant continued to be cordial.
Kentucky Fried Chicken (M) Sdn Bhd (KFCM), KFC (Peninsular Malaysia) Sdn Bhd and QSR Stores Sdn Bhd renewed a fresh cut poultry supply contract recently with DBE Gurney for its outlets in Perak and Selangor estimated at RM50 million.
KFCM and KFC (Peninsular Malaysia) are subsidiaries of KFC Holdings (M) Bhd, which in turn is owned by QSR Brands (M) Holdings Sdn Bhd.
“HARUMi’s business model is quite different from KFC. We have a variety of point of sales from restaurants, express outlets, food trucks to kiosks,” said Ding.
“Also, HARUMi restaurants are not in shopping malls. They are located at more affordable sites where college and university students tend to cluster,” he said.
Asked if the Year of the Rooster would give impetus for HARUMi’s expansion plans, Ding said: “Malaysia is one of the world’s highest poultry consumers at 42kg per capita per year. Malaysians love poultry. We can eat chicken for breakfast, lunch and dinner.”
DBE Gurney’s processing centre in Perak is able to pack 1.5 million chicken cuts per month.
“In the longer term, we hope to replicate HARUMi in Indonesia, Brunei, Thailand, Myanmar, China and in Taiwan, too,” said Ding.
DBE Gurney operates a 114,000-tonne-per-year feedmill and a 60,000-bird-per-day slaughter house in Sitiawan.
The group has six breeder farms with a capacity of 100,000 birds per year, 11 broiler farms that can supply 10 million birds per year, and a hatchery with six sets of incubators that can produce 12 million eggs a year.
DBE Gurney Resources Bhd
group managing director Datuk Alex Ding Seng Huat
DBE Gurney group managing director Datuk Alex Ding Seng Huat