Johor Corp (JCorp) has rubbished claims by opposition parties that it will go bankrupt in two years, saying it can afford to offset its liabilities with assets if required.
JCorp, which has 280 member com-panies with 65,000 employees, has an outstanding loan of RM3.8 billion due in 2012.
Its president and chief executive Tan Sri Muhammad Ali Hashim said the market capitalisation value of eight companies within JCorp was RM10.4 billion based on the market closure on December 31 last year.
"This figure includes Kulim (M) Bhd, which is listed on the Port Moresby Stock Exchange in Papua New Guinea and the Stock Exchange of London.
"In the financial year 2009, JCorp recorded group pre-tax profit of RM670 million compared with RM660 million the previous year, which is an increase of RM10 million, or 1.5 per cent," he told a press conference on JCorp's audited financial performance in Johor Baru yesterday.
Muhammad Ali said that JCorp itself made pre-tax profit of RM100 million last year compared with RM82 million the previous year.
He attributed JCorp's higher profit to the good performance of its subsidiaries, namely Kulim (RM522 million), KFC Holdings (M) Bhd (RM230 million) and KPJ Healthcare Bhd (RM114 million). Earnings contribution in total was more than RM1 billion.
In the event that JCorp has to sell its assets to meet the RM3.8 billion debt come 2012, it will still be a sustainable corporation, Muhammad Ali said.
"There will be no issue of JCorp not meeting its payments and the Johor state government becoming bankrupt as the corporation has enough value and assets against liabilities."
Come 2012, JCorp also has the option to restructure its existing loans, he added.
Muhammad Ali pointed out that JCorp still has time to unlock potential from its assets.
"Our focus now is to add value to our assets and, at the same, time create wealth for the company.
"That is our top priority and we are confident that it can be done," he said.
By Ben Tan
Business Times
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