It is looking to cash in the growing demand for industrial gases, setting up a new hydrogen generating system at its plant and expanding aggressively in East Malaysia to leverage on projects under the SCORE.
It will be targeting new and existing customers across all industries, focusing mainly on the palm oil and biodiesel industries for a start.
The expansion plan is in line with the expected increase in demand for industrial gases in 2011. It will also benefit from the roll out of infra projects by the government as argon and oxygen are needed in construction. SIGGAS will only see the bulk of the contribution from these projects in FY2012 as the rollout is only expected in mid 2011.
Construction on the Kemena plant is expected to start mid 2011 and begin commissioning in 2QFY2012. Kemena is a strategic location for SIGGAS to set up a based in Sarawak in light of the implementation of the SCORE.
While SIGGAS’s main focus is the local market, the Sarawak plant puts it in a position to explore markets in Brunei and Indonesia.
As at Sept 30, 2010 SIGGAS had borrowings amounting to rm13.69 million while cash and bank balances stood at rm19.50 million. In a net cash position SIGGAS can gear up to fund its expansion plans.
For nine months ended Sept 30, 2010, it posted a net profit of rm4.52 million on the back of rm5=41.5 million in revenue.
For FY2009, the group posted a net profit of rm7.11 million on the back of rm54 million in revenue.
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