1. Investing in Malaysia Oleon Testimonial

2. Agenda Oleon NV Oleon’s activities in Malaysia Why Malaysia?
June 4th 2014

3. I. Oleon NV – Natural Chemicals
Fats and oils
Triglycerides
Base oleochemicals
Glycerine
Fatty acids
Esters Derivatives
Oleochemical derivatives
Vegetable Oils & Animal Fats
June 4th 2014

4. I. Oleon NV – Business segments
Beauty, Health & Home care
Oilfield Chemicals
Nutrition : Food & Feed Additives
Agrochemicals
Coatings, Inks, Solvents & Green plasticizers
Lubricants & specialty additives
June 4th 2014

5. I. Oleon NV – History 1835 2009 1958 2006 2012 2008 OLEON History 2007
Candle factory Oelegem
2009
Take-over by Sofiprotéol of 100 % of
the shares
1958
Start of oleochemical plants Ertvelde & Oelegem
2006
Closure of Sandefjord fatty acids
Acquisition of Akzo Nobel Oleochemicals plant
Construction of the first dedicated biodiesel plant in Belgium
2012
Start up of PG-plant in Ertvelde
Start up of new reactor line in Port Klang Start up of glycerine plant in Porto Corsini
2008
Ester plant in Malaysia
OLEON History
2007
Construction of new FA3
plant in Ertvelde after fire
2014
Start up of UniOleon new food emulsifier plant
2011
New distillation unit in Oelegem
New investments in Ertvelde & Oelegem towards surfactant oleochemicals under
Oleofina/PetroFina
Acquisition of Sandefjord
New glycerine refinery in Ertvelde
Dimer plant in Oelegem
2010
Doubled capacity in Port Klang
2013
New distillation unit in Oelegem
June 4th 2014

6. I. Oleon NV – Our Shareholder
Our shareholder SOFIPROTEOL was founded in 1983 with a unique mission to develop and promote oilseed crops in France.
June 4th 2014

7. I. Oleon NV – Our Shareholder
Oleon is integrated in the agro-alimentary chain of Sofiproteol :
June 4th 2014

8. 8 production 600.000 tons of Oleochemicals in 2013 849 employees
I. Oleon NV – Facts & figures
tons of Oleochemicals in 2013
54 R&D Scientists based
in 3 R&D centres
8 production
plants
Ertvelde (+ HQ) – Belgium
Oelegem – Belgium
Compiègne – France Sandefjord – Norway
Emmerich – Germany
2x Port Klang – Malaysia
Porto Corsini – Italy
No. 1 in Europe
with estimated market share 23%
849 employees
11 sales affiliatres in Europe, USA and Asia
725 mio €/y turnover in 2013
June 4th 2014

9. Agenda Oleon NV Oleon’s activities in Malaysia Why Malaysia?
June 4th 2014

10. II. Malaysia – Our history
Jul 2014
Plant in P. Indah – UniOleon
Jun 2012
Plant in P. Indah – Phase II
Jun 2009
Plant in P. Indah – Phase I
Jan 2008
Office in Klang
Jan 2001
Office in JB
Before 2000
Office in Fina
Singapore
June 4th 2014

11. II. Malaysia – Current Setup
Oleon Sdn Bhd
100% Owned
Manufacturing (Ester for Food, F&F, Lubricant, P. Care, Polymer)
50% Owned
50% UP
Unioleon Sdn Bhd (Joint Venture)
Manufacturing (Emulsifiers for Food, Personal Care, Polymer)
Oleon (Asia-Pacific) Sdn Bhd
100% Owned
Trading (marketing products from all plants globally to AP & ME)
Oleon NV
OHQ (rendering services to Oleon NV, Oleon China and Oleon Americas)
Purchasing
Marketing Services
SAP Support
Application Support
Advisory (Consulting)
Finance Services
Raw material sourcing
Marketing communication
and market research
Support Americas and Asia SAP projects and rollout
Application research
Oleon China
Provide Finance Services to affiliates
in AP & ME
June 4th 2014

12. II. Malaysia – Investment I : Oleon Sdn Bhd
The factory is located 50km west of Kuala-Lumpur on Pulau Indah or “Beautiful Island” of the coast near Port Klang.
Close to Westport (5km) and Northport (25km), which is the 13th busiest container port in the world (mainly GP box). As a comparison, Antwerp ranks 14th.
June 4th 2014

13. II. Malaysia – Investment I : Oleon Sdn Bhd
Goal : Support our growing presence in North America, and support our future growth in AP
Why Malaysia?
Asia-Pac vs USA : Produce where raw materials are & future growth market
In Asia : China vs Malaysia vs Singapore
Start up May 2009 (I) & Aug 2012 (II)
Total Investment Mio € (I) + 12 Mio € (II)
Annual turnover Mio €
NWC Requirement 27%
Employees
June 4th 2014

14. II. Malaysia – Investment II : OHQ
2011
2010
2009
2008
2007
2006
2005
2004
2003
2001
2002
Sales Turnover(MYR)
Profit After Tax (MYR)
2013
2012
All figures are shown in MYR (Millions)
Established 1sty of January 2013
Sales Turnover 2014 : 230 Million MYR
Trading : 95%
OHQ Services : %
Human assets :
Moved from 2 people to 24 people at the end of 2013.
 Growing to 35 people.
Oleon China :
Also overseeing and managing Oleon China which was established in Feb 2012
Trading ● OHQ Services
June 4th 2014

15. II. Malaysia – Investment II : OHQ
Central
Asia
East Asia
Southeast Asia
Oceania
South
Middle East
2013 Turnover:
MYR 230 Million
June 4th 2014

16. 1 2 3 4 II. Malaysia – Investment II : OHQ MARKETING SERVICES
SERVICES & SUPPORT
> SAP Competence center & Helpdesk
> PS&RA support
> Management & Finance Services
MARKETING SERVICES
> Promote all products from Oleon factories to Asia Pacific and Middle East Countries.
APPLICATION SERVICES & COMPETENCY DEVELOPMENT CENTRE
> Regional customer support center
> Training/Technical Knowledge center for both internal as external sales organization.
RAW MATERIALS SOURCING
> From Asia Pacific region for all Oleon plants & Trading. 1 4 2 3
June 4th 2014

17. U N I T E D P L A N T A T I O N S B H D
II. Malaysia – Investment III : UniOleon
50/50 Joint Venture between United Plantations Bhd and Oleon nv through the company UniOleon Sdn. Bhd.
UniOleon Sdn. Bhd.
MISSION :
United plantations & Oleon NV the perfect match to produce food emulsifiers with the highest possible technical performance, and this by using raw materials and production processes complying with the most severe quality & sustainability standards.
U N I T E D P L A N T A T I O N S B H D
June 4th 2014

18. II. Malaysia – Investment III : UniOleon
KEY Facts & figures :
Total investment : 16 Mio € (I) + 10 Mio € (II)
Capacity : MT
Employees : 50
Star up date : Q (I) + S (II)
June 4th 2014

19. II. Malaysia – Investment IV : Global Innovation Hub
Key Facts :
Total Investment : 4,5 – 5 Mio €
Scientists : 20
June 4th 2014

20. II. Malaysia – Investment IV : Global Innovation Hub
June 4th 2014

21. II. Malaysia – Investment IV : Global Innovation Hub
Business Model
June 4th 2014

22. Agenda Oleon NV Oleon’s activities in Malaysia Why Malaysia?
June 4th 2014

23. III. Why Malaysia? KEY Drivers to invest in Malaysia :
Access to raw materials
Lower investment costs (especially for land)
Centrally located in the region
Good export infrastructure
Good incentive package & support offered by MIDA which resulted in pioneer status (10 years) + R&D grant.
SSIC support when constructing plant to get permits/certificates & utilities  Fast track approvals
June 4th 2014

24. III. Why Malaysia? – Challenges
Slow-down in the China’s economy is putting pressure on inter-Asian trade which could impact Malaysia’s exports.
Loss of GST Status
Energy cost (natural gas and electricity) is increasing and moving towards the Asian level.
Energy cost in the US, due to larger availability of natural gas at low prices (around 4USD/mmBTU) is turning Asia uncompetitive for energy dependent activities.
Increments of salaries outpaces the rest of the world with a small base to find good talents and competition for talents can further erode bottom line (talent turn over & retention)
Congestion, typical to growing economy, actions are being undertaken.
The image of some of Malaysias largest natural resources is under pressure by the European public opinion (forestry and palm oil).
Economic
Energy
Employment
Infrastructure
Image
June 4th 2014

25. III. Some Tips
South-East Asian mentality is fairly close to the Flemish:
Pragmatic, a can-do mentality & a fair amount of business is done (after the working hours) through personal network
Do not rely on local consultants :
Opt for using your own Flemish/Belgian/European presence (that you can rely upon)
For export oriented activities, be aware of fast increasing CPI which could turn business uncompetitive.
Make your business plan realistic considering real prices and costs and not the ones consultants tend to provide.
Do not consider South-East Asia as a low-cost region (with the exception of some labor intensive activities where a few countries are still attractive e.g. Cambodia, Myanmar, Indonesia, …), but not Singapore, Malaysia or even Thailand.
For regional markets activities, consider your logistics and supply chain very well
The region is huge with sometimes fairly poor infrastructure.
June 4th 2014

26. Thank you
June 4th 2014

27. Back up
June 4th 2014

28. III. Energy prices
June 4th 2014

29. Oleon’s Employment in Malaysia
Currently Oleon Sdn. Bhd. employs approximately 70 people. Oleon (Asia-Pacific) Sdn. Bhd. Employs approximately 30 people in Sales & Marketing, Finance, SAP, application specialists and QA.
For phase III and IV, the total employment will further increase with 35 and 45 people respectively as a minimum.
Of all staff at Oleon Sdn. Bhd. nearly 50% is having a certificate or diploma (bachelor or master). All staff have completed secondary education levels.
Minimum wages are MYR32,700 gross per year (excluding bonuses potentially adding up to 4 months pay).
We are hiring in-house specialists to provide global services to Oleon Group (e.g. SAP consultancy, procurement,...)
June 4th 2014

30. Oleon’s Contribution to Malaysian Economy
Investment
Total investment of Phase I, II and UniOleon Phase I and II amounts to RM210 million
Total Working capital commitment (inventory, receivables,...) another RM160 million
This brings total investment in the Malaysian economy to RM370 million
Construction mainly carried out by Malaysian companies. Even core equipment such as reactor is designed and built in Malaysia
UniOleon phase I and II will provide work for temporary workers
80% of our Raw materials are sourced in Malaysia
Oleon produces high value added derivatives that provide a downstream valorization of palm oil
Construction
Added Value
June 4th 2014