‘PUA’S CLAIMS

Review of Malaysia’s biggest sugar company shows it did not make super profits

ARFA YUNUS KUALA LUMPUR news@nst.com.my

DAP national publicity secretary Tony Pua is wrong to accuse the government of making “super profits” and taking advantage of the public by increasing the sugar price by 11 sen earlier this month.

The Barisan Nasional (BN) strategic communications team said the Petaling Jaya Utara member of parliament misled the public in saying that sugar prices were lower in the years prior to 2013 without stating that the commodity prices were heavily subsidised by the government.

It adds that in 2013, the government had removed sugar subsidies partly due to health concerns and to heed calls for consumer associations.

Pua on Thursday alleged that the BN government had allowed Malaysia’s sugar duopoly to make super profits over the past two years.

“However, an examination of Malaysia’s largest sugar company, the Felda-controlled MSM Malaysia Holdings Bhd’s accounts shows that it made a net profit of RM275 million on revenues of RM2.3 billion in 2015 and a net profit of RM118 million on revenue of RM2.65 billion last year — or net margins of just 12 per cent and 4.4 per cent respectively — hardly super profits.

“As a comparison, the Penang state monopoly water company PBA Holdings Bhd (PBAHB), which is owned by the DAP Penang state government with its chief minister (Lim Guan Eng) as the chairman, had reported that it earned RM62 million in net profit out of revenues of RM327 million, which is a net profit margin of 19 per cent.

“In fact, both the gross and net profit margins of PBAHB far outpaces MSM,” said a statement from the communications team.

It added that PBAHB was able to announce a big 63 per cent jump in net profits after the Penang government raised water rates by 16.7 per cent in 2015, on top of two other water rates increases in 2010 and 2013, with the rationale given that it would help consumers use less water.

It also stated that last year, the