KTMB's RM1b cargo revenue target

by **hlk** Wed 27 Jul 2011, 08:07

Keretapi Tanah Melayu Bhd's cargo business, coupled with its multi-modal and distribution units, now makes about RM210 million revenue a year.

Kuala Lumpur: National railway company Keretapi Tanah Melayu Bhd (KTMB) aims to rake in revenues of more than RM1 billion from its cargo business in five years, its chief said.

Currently, the cargo business, coupled with KTMB's multi-modal and distribution units, makes about RM210 million revenue per annum.

Business Times reported on Monday that KTMB's cargo and multimodal units will be combined and parked under a new company called KTMB Logistics Sdn Bhd, headed by Datuk Alias Kadir.

KTMB president Dr Aminuddin Adnan said the RM1 billion target is achievable.

He is attributing growth to the new six-car Electric Multiple Unit (EMU) trains and strategic alliances that KTMB is forming with other train operators.

KTMB will get its first set of EMU trains on September 6 while five more will be shipped by year-end.

The rest of the 38 sets, which the government had ordered for RM1.9 billion, is expected to be delivered by June 2012.

"This is the kind of transfor-mation that we are working on. We are waiting for the Ministry of Finance Inc to approve the plan after which we will come up with a new business model to turn around KTMB," Aminuddin told Business Times at Balai Berita here yesterday.

KTMB is segregating its core businesses under a two-phase restructuring plan, with the aim of being more efficient and profi-table.

Under the Government Transformation Plan, 33 listed and unlisted government-linked companies will undergo restructuring in various stages, including KTMB, to operate more efficiently.

"KTMB has a lot of potential waiting to be unleashed. We hope it will start making operating profits in two years. The cargo business will be the first to help it turnaround," Aminuddin said.

KTMB has been making losses since it was corporatised in 1992 due to high operating costs. It did, however, make a net profit of RM9 million to RM15 million from 1993 to 1995, before falling into the red again in the following years