ITEM Industrial Engineering Sdn Bhd, a manufacturer of electrical switchgear, expects to achieve turnover of RM60mil this year, compared with RM20mil last year, said executive chairman Datuk Wira Ayob Aziz.
Speaking to reporters after the presentation of ISO9001:2000 certification to Item in Batu Caves, Selangor, yesterday, Ayob said the low turnover last year was due to fewer contracts from Tenaga Nasional Bhd (TNB), which accounts for about 90% of its business.
He attributed the contraction in business to the economic slowdown. TNB installs Item's switchgears in industrial and property development areas.
This year we are targeting a turnover of RM60mil, of which about RM57mil will come from a TNB contract to supply 900 switchgearswhich we are still negotiating for.
The remaining RM3mil will come from the private market, which include small property development companies and contractors, Ayob said.
Item manufactures medium voltage switchgears for secondary electrical power distribution under a licensing agreement with Siemens of Germany. Its clients include Petroliam Nasional Bhd, Sabah Electricity Sdn Bhd, Sarawak Shell Bhd and Siemens Malaysia Sdn Bhd. The company is also a Class 1 electrical contractor providing engineering design, equipment supply, and the installation and maintenance of substations.
Ayob said Item, which has a paid-up capital of RM1.85mil, produces about 70 switchgears a month. It could make a maximum 120 units a month.
He said due to the economic uncertainty the company had to put on hold its plan to develop an RM11mil plant on a 3.5-acre site Sungai Buloh, which was to house all its manufacturing operations currently spread over three different places in Batu Caves.
For the time being, we plan to consolidate our operations by moving all our manufacturing operations to a 100,000-sq-ft factory which we plan to rent in Batu Caves soon, Ayob said.
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