See Hup sees GST impacting operating cost

by **Cals** Sun 21 Sep 2014, 19:06

Business & Markets 2014

Written by Sangeetha Amarthalingam of theedgemalaysia.com

Friday, 19 September 2014 16:28

GEORGE TOWN (Sept 19): Logistics old-timer See Hup Consolidated Bhd believed there would be an overall impact on its operating cost structure when the goods and services tax (GST) is implemented on April 1 next year.

“GST would definitely cause an overall impact on our business especially in the cost for items that we transport as well as our own purchase of trucks and spare parts,” said Group Managing Director Lee Chor Min after the firm’s annual general meeting.

The group recorded lower revenue at RM84.1 million for the financial year ended March 31, 2014 compared with RM94.1 million the previous year.

“Despite the drop in revenue, the group is able to report a pre-tax profit of RM333,000 against the previous year’s loss of RM2.8 million through higher operating profit, lower finance costs and a marked increase in profit contribution from an equity accounted associate,” he said.

Lee said the group which owns a fleet of more than 300 trucks was focusing more on providing trucking services for the construction and infrastructure industry in Kuala Lumpur and Johor.

See Hup anticipates a conservative growth rate of 5% next year as it delves into the provision of trucking services to cater for the growing construction, industrial and infrastructure projects in Iskandar Malaysia and the Klang Valley.

He said the group would spend RM3 million to purchase about 20 more trucks to expand its business.

Meanwhile, See Hup’s sea and air freight division, which began about four years ago continues to see growth. The divison’s revenue revenue grew 42% at RM3.7 million compared to RM2.6 million in the previous year.

On future expansion plans, See Hup hoped to build a new warehouse on a 19-acre industrial land in Penang, said Lee.