, Singapore

Here are Olam's top 4 priorities for Fy14

And their 6 ways to achieve them.

According to UOB Kay Hian, Olam's key target is to become free cashflow positive by FY14 (previously FY15). This is targeted through a reduction in planned capital expenditure by S$1.0b and the release of S$1.5b through balance sheet optimisation and unlocking intrinsic value of assets. 

These could include securitising assets, working capital rationalisation and sales & leaseback of upstream assets. Sub-scale profit centres and countries with returns below the group’s benchmark will also be rationalised.

Here's more from UOB Kay Hian:

In line with its plan to cut gearing, management will also reduce its gearing cap, from less than 2.5x net gearing to less than 2.0x net gearing by the end of the strategic review period. 

The group highlighted four new priorities including: a) accelerating free cash flow generation, b) reduce gearing, c) reduce complexity, and d) promote better understanding of its businesses. 

Management announced six ways to achieve its new priorities including: a) recalibrating pace of investments, b) optimise balance sheet, c) unlocking intrinsic value, d) re-shaping its portfolio and reducing complexity, e) improving operating efficiencies, and f) enhance stakeholder communication. 

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