The inside view: Mainland’s recovery


Bob Hansen, appointed Mainland’s Chief Executive Officer in May 2012, provides an insight into the challenges the company is facing, and outlines a strategy to place it on a sustainable and profitable footing.

Mainland Holdings' Bob Hansen

Mainland Holdings’ Bob Hansen

Mainland has between 2000 and 2500 employees, plus we have four hundred smallholder growers on our books, and we’ve got a turnover of nearly 300 million kina (US$141 million). It’s been operating really only on a break-even basis and I’ve been asked to come and help them recover the profitability.

My previous job was with a company called Sunny Brand Chicken in Byron Bay, Australia. Westpac asked me to go there and do a recovery for them. It was a poultry company with a turnover of AUD$110 million. I returned the company to profitability, and sold it to major producer, Ingham.

I was here at Mainland between 1976 and 1986, and I actually designed and built a lot of the facilities during that time. Coming back was quite pleasing. Most of the facilities that are still there are in good condition.

What we’ve done is tried to focus on what we consider to be our core business: intensive livestock, feed milling, and agricultural type food products.

There are, however, some facilities that need a lot of work because they’ve had tough times here for four or five years and have spent little money on some really key facilities. Those facilities do need re-work or upgrading. That’s going to be a big challenge—finding the capital to do that. We haven’t had that discussion at Board level yet, but it will have to be a combination of equity and funding. There’s certainly a feeling among current shareholders that they want to keep Mainland a Papua New Guinean company, so that’s going to narrow some of our options going forward.

We’ve pulled the business back to really just agricultural products: chickens, eggs, flour, stock feed and crocodiles. Our Mainland Coffee division was sold, the Huon Electrical wholesale and contracting service has closed, and we’ve pulled back the ABCO Transport trucking business to service just our own businesses. I don’t think there’ll be more trimming of the company.

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What we’ve done is tried to focus on what we consider to be our core business: intensive livestock, feed milling, and agricultural type food products. What we’re trying to do is reinvest in those businesses and use them as a base to grow.

We have a huge land portfolio and we use a lot of that portfolio for live poultry. We are also looking at some alternative uses for the land as well. I think there are opportunities to grow the business with product development and with exports, and we’ll be restructuring our management team around that basis. For us, there is a lot of opportunity. We just have to get our own house in order, which I’m hoping we’ll have done by the end of 2012, and then we’ll be ready to go.

Editor’s note: After years of under-investment and poor performance, major diversified PNG agribusiness, Mainland Holdings, received a stabilising investment from local superannuation fund NASFUND at the end of 2010.

First published in Made in PNG 2012