The National Feedlot Corp (NFC) has denied that the project is in disarray, instead it has met the target set by the government.
Its chairman Mohamad Salleh Ismail said as the 30-year contract was only in the third year, teething problems during initial stage were to be expected.
"In fact, NFC has raised 8,016 head of cattle in 2010, surpassing its target of 8,000 head of cattle.
"We are importing cattle from Australia and we have to feed them for between four and six months. We do not slaughter them soon after arrival.
"We will not slaughter the cattle if there is no market. And when they are not slaughtered, cattle feed costs will also increase," he said when commenting on the Auditor-General's Report at the NSC office in Gemas today.
The AG's Report said that NFC was in a mess and its production last year were only 3,289 head of cattle or 41 per cent of the target set.
Mohamad Salleh said at the outset of its operation in 2009, NFC had yet to find the market while the abattoir was only approved in April that year, halal certification two months later and the Veterinary Health Mark, which was compulsory before meat could be sold, in 2010.
He said NFC also needed to send its employees for training to acquire specific skills to run the operation.
On the poor condition of the road leading to the farm, he said it was a public road and the maintenance was not included in NFC's budget.
NFC is holding a discussion with relevant ministries to plant grass on the road shoulder while the damaged pond will be repaired in stages, he added.
Mohamad Salleh said the farm had just been affected by floods when it was visited by officers from the Auditor-General's Department.
The news conference was also attended by NFC lawyer Mohamed Shafee Abdullah, corporate and finance consultant Zakaria Mohammad and director Wan Shahinur Izmir Mohamad Salleh.
RM250 million not a grant
NFC obtained a loan of RM250 million from the government and it is not a grant, said Mohamad Salleh.
He said the loan must be repaid as any commercial loan, albeit certain concessions given.
The RM250 million, at an interest rate of two per cent, was repayable commencing on the third year of full disbursement of the said loan and upon completion of the construction of an export quality abattoir, he said.
"Currently the loan has not been fully disbursed to the NFC. There is RM69 million of the remaining loan to be utilised," he told the press conference to address allegations by PKR on the NFC's performance.
Mohammad Salleh said the loan was placed in Special Loans Account but a drawdown process was required before funds could be utilised by the NFC.
On the allegation that the Meatworks chain of restaurants received special discount amounting to RM2.9 million in 2009, Mohammad Salleh said the same discount was received by all 70 customers it had during that time.
Creating Meatworks as a brand name in selling quality meat had enabled NFC to penetrate into an already tightly managed and controlled market, Mohammad Salleh said.
"People cannot believe that Malaysia can produce good quality premium meat," he added.
On the higher price of NFC cattle compared to cows purchased in Malaysia, Mohammad Salleh said the NFC cows usually weighed 70-100 per cent more than local cows.
Mohammad Salleh said NFC now had 150 client companies and a few of its biggest clients were Jusco, Giant and Cold Storage.
NFC supplied 46 per cent of its meat to wet markets, 20 per cent to hypermarkets, 22 per cent went to processing meat for burgers and patties and only 11 per cent to hotels, restaurants and catering companies, he said.
He said in the three years since its inception, NFC had managed to develop infrastructure such as feedlot, abattoir, feedstore and cold rooms.
Next year, he said NFC would embark on contract farming.
"We have already broken-even and expect to register a profit," he added.
A place to park the money
Answering allegations by PKR which questioned the company's acquisition of condominium units in Bangsar, Mohamad Salleh in asaid the purchase of two units at the One Menerung condominium amounting RM6.9 million each was a commercial decision to hedge unutilised funds for an abbatoir project, which was delayed but not at the fault of the NFC.
"We can put it in fixed deposit but face loss of value because our inflation is higher.
"While waiting for the project to start, we needed to find a place where we could park the money short for term, avoid depreciation and make profits almost yearly," he said.
Mohammad Salleh said ideally, leaving the funds in fixed deposits would be less controversial but would not give the company the necessary yield from funds of this size.
NFC corporate and financial consultant Zakaria Mohammad said the group received about RM700,000 rebate per unit for two years from the developers and they also made arrangement for NFC for the rental of the units with a guaranteed yield at about RM200,000 per year.
NFC would make about RM3.6 million from both units for the first two years which are 2010 and 2011, all of which would be credited to the NFC group, he said.
Mohammad Salleh said the purpose of the loan given to NFC was undoubtly for cattle farming and infrastructure.
Therefore, although buying condos was a departure from the purpose of the loan, the properties were still kept in the name and books of the company.
It was a matter of converting the property back into cash at the desired profit and there was neither unjust enrichment nor dishonesty of any private individuals, he added.
- Bernama
Its chairman Mohamad Salleh Ismail said as the 30-year contract was only in the third year, teething problems during initial stage were to be expected.
"In fact, NFC has raised 8,016 head of cattle in 2010, surpassing its target of 8,000 head of cattle.
"We are importing cattle from Australia and we have to feed them for between four and six months. We do not slaughter them soon after arrival."We will not slaughter the cattle if there is no market. And when they are not slaughtered, cattle feed costs will also increase," he said when commenting on the Auditor-General's Report at the NSC office in Gemas today.
The AG's Report said that NFC was in a mess and its production last year were only 3,289 head of cattle or 41 per cent of the target set.
Mohamad Salleh said at the outset of its operation in 2009, NFC had yet to find the market while the abattoir was only approved in April that year, halal certification two months later and the Veterinary Health Mark, which was compulsory before meat could be sold, in 2010.
He said NFC also needed to send its employees for training to acquire specific skills to run the operation.
On the poor condition of the road leading to the farm, he said it was a public road and the maintenance was not included in NFC's budget.NFC is holding a discussion with relevant ministries to plant grass on the road shoulder while the damaged pond will be repaired in stages, he added.
Mohamad Salleh said the farm had just been affected by floods when it was visited by officers from the Auditor-General's Department.
The news conference was also attended by NFC lawyer Mohamed Shafee Abdullah, corporate and finance consultant Zakaria Mohammad and director Wan Shahinur Izmir Mohamad Salleh.
RM250 million not a grant
NFC obtained a loan of RM250 million from the government and it is not a grant, said Mohamad Salleh.
He said the loan must be repaid as any commercial loan, albeit certain concessions given.
The RM250 million, at an interest rate of two per cent, was repayable commencing on the third year of full disbursement of the said loan and upon completion of the construction of an export quality abattoir, he said.
"Currently the loan has not been fully disbursed to the NFC. There is RM69 million of the remaining loan to be utilised," he told the press conference to address allegations by PKR on the NFC's performance.
Mohammad Salleh said the loan was placed in Special Loans Account but a drawdown process was required before funds could be utilised by the NFC.On the allegation that the Meatworks chain of restaurants received special discount amounting to RM2.9 million in 2009, Mohammad Salleh said the same discount was received by all 70 customers it had during that time.
Creating Meatworks as a brand name in selling quality meat had enabled NFC to penetrate into an already tightly managed and controlled market, Mohammad Salleh said.
"People cannot believe that Malaysia can produce good quality premium meat," he added.
On the higher price of NFC cattle compared to cows purchased in Malaysia, Mohammad Salleh said the NFC cows usually weighed 70-100 per cent more than local cows.
Mohammad Salleh said NFC now had 150 client companies and a few of its biggest clients were Jusco, Giant and Cold Storage.
NFC supplied 46 per cent of its meat to wet markets, 20 per cent to hypermarkets, 22 per cent went to processing meat for burgers and patties and only 11 per cent to hotels, restaurants and catering companies, he said.
He said in the three years since its inception, NFC had managed to develop infrastructure such as feedlot, abattoir, feedstore and cold rooms.
Next year, he said NFC would embark on contract farming.
"We have already broken-even and expect to register a profit," he added.
A place to park the money
Answering allegations by PKR which questioned the company's acquisition of condominium units in Bangsar, Mohamad Salleh in asaid the purchase of two units at the One Menerung condominium amounting RM6.9 million each was a commercial decision to hedge unutilised funds for an abbatoir project, which was delayed but not at the fault of the NFC.
"We can put it in fixed deposit but face loss of value because our inflation is higher.
"While waiting for the project to start, we needed to find a place where we could park the money short for term, avoid depreciation and make profits almost yearly," he said.
Mohammad Salleh said ideally, leaving the funds in fixed deposits would be less controversial but would not give the company the necessary yield from funds of this size.NFC corporate and financial consultant Zakaria Mohammad said the group received about RM700,000 rebate per unit for two years from the developers and they also made arrangement for NFC for the rental of the units with a guaranteed yield at about RM200,000 per year.
NFC would make about RM3.6 million from both units for the first two years which are 2010 and 2011, all of which would be credited to the NFC group, he said.
Mohammad Salleh said the purpose of the loan given to NFC was undoubtly for cattle farming and infrastructure.
Therefore, although buying condos was a departure from the purpose of the loan, the properties were still kept in the name and books of the company.
It was a matter of converting the property back into cash at the desired profit and there was neither unjust enrichment nor dishonesty of any private individuals, he added.
- Bernama
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