Tiong Nam’s warehouses have long been rumoured to be spun off into a real estate investment trust (REIT) for their real value to be unlocked.
KUALA LUMPUR: Logistics and warehousing provider, Tiong Nam Logistics Holdings Bhd
, has invested RM96.8mil in capital expenditure (capex) in the nine months ended Dec 31, 2016, as part of its ongoing expansion programme.
The capex is mainly to increase the storage space at its existing warehouses in Malacca and Johor, and to enhance its Automated Storage Retrieval System (ASRS) in Shah Alam.
Its warehouses are almost fully-utilised at present and are unable to capture higher demand from existing and potential customers, said managing director Ong Yoong Nyock in a statement on Monday.
“We increased our warehousing capacity to 4.9 million sq ft from 4.7 million sq ft previously.
“We are in the midst of further expansion to reach 5.1 million sq ft in capacity in the near term, which would render us ready to fulfil constant enquiries from domestic and regional customers,” Ong said.
At the same time, Ong said the increased utilisation of ASRS would accord Tiong Nam greater operation efficiency by increasing accuracy while maximising storage space and reducing labour costs.
Ong said that the group intended to continue strengthening its logistics business to retain its position as a leading logistics and warehousing services provider in Malaysia.
“We are mindful of the demand uptrend in logistics services in line with the rapid adoption of e-commerce in Malaysia and the region.
“We are eager to focus our efforts on increasing our market share.
“We believe that our growth would be back on track once the additional capacity comes onstream in the near-term,” said Ong.
Meanwhile, in its filing with Bursa Malaysia, Tiong Nam announced its revenue for third quarter ended Dec 31, 2016, declined to RM139mil from RM173mil recorded in the corresponding quarter in 2015.
Profit before tax was also lower at RM22mil from RM33mil previously. - Bernama
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