APFT ventures into O&G industry to boost earnings

by **Cals** Mon 30 Dec 2013, 14:51

Business & Markets 2013

Written by Ahmad Naqib Idris Adzman Shah of theedgemalaysia.com

Monday, 30 December 2013 12:57

KUALA LUMPUR (Dec 30): APFT Bhd, a flight training academy, announced its diversification into the oil & gas (O&G) sector today through the acquisition of a 51% equity interest in PT Technic (M) Sdn Bhd (PTTSB).

The acquisition of PTTSB comes with a profit guarantee of RM5.998 million, of which a 51% share or RM3.05 million is entitled to APFT Bhd for the financial year ended March 2014 (FY2014).

Dato’ Faruk bin Othman, executive chairman of APFT Bhd said at a press briefing after an extraordinary general meeting (EGM) today that the acquisition is necessary to mitigate losses from the aviation segment of the group.

“For the last three quarters, we were still having losses in our flight schools, on our aviation side.

“But, with the acquisition and the profit guarantee, we will definitely lessen the losses that the company will have,” said Dato’ Faruk.

The group had attributed the losses in the aviation segment to negative publicity on the sector as word went round two to three years ago that there was an excess of cadet pilots in the market.

“I think that things are different now. As I mentioned earlier, there are a lot of requests now by airlines looking for cadet pilots and we are now also in talks with airlines that plan to increase training with us,” said Dato’ Faruk.

When asked regarding the competition in the O&G industry, Dato’ Faruk said he is not too worried as the group will be involved in the downstream aspects of O&G, and said that PTTSB has a good track record.

Looking forward, Dato’ Faruk said that the group can expect to see a turnaround in the next financial year, as sentiments regarding the aviation industry is expected to improve, coupled with contributions from its new O&G segment.

“With a number of contracts in the market, I think if we get about 10% to 20%, it should be sufficient to improve our bottomline,” said Dato’ Faruk, adding that there are about RM20 billion worth of O&G contracts in the market currently.