LHIB ... July 09

Furniture manufacturer is going upstream this year with its own rubber tree plantation to ensure a constant supply of rubber wood.

The Johor government had approved some 3237.48ha in the Endau-Rompin area for the company to plant rubber trees. They are still finalising the cost of planting rubber trees on the land and initially will start with 121.40ha.

It would probably take a few years before the company could harvest the rubber wood from the estate as the raw material for its furniture.

By having its own rubber tree plantation, the company could lessen its dependency on getting rubber wood from other suppliers. The plantation would be undertaken by the company’s subsidiary Lii Hen Plantation Sdn Bhd, which was involved in planting, cultivating, milling and dealing in agriculture products particularly rubber trees and other kinds of wood.
The company would focus on the mid-range furniture as the demand was better compared with the high-end segment for the US market.

Apart from the United States, the company’s exports were also to countries in the Middle East. While most of the American consumers went for bedroom sets, Middle Eastern consumers preferred audio visual cabinet sets and computer tables.

For the financial year ended Dec 31, 2008, the company recorded RM5.32mil net profit on RM173.18mil revenue against RM1.18mil and RM150.28mil respectively for FY2007.