GEORGE TOWN: Spritzer Bhd plans to set up two high speed fully automated bottling lines at its facilities in Shah Alam and Yong Peng this year as part of a RM40mil investment plan.
The new lines are expected to boost the group’s production capacity from 750 million bottles now to 900 million bottles in 2021.
“The two lines will be installed by the end of 2020, ” group managing director Datuk Lim Kok Boon told StarBiz.
"The bulk of the capital expenditure budget was allocated for the new lines.
“The group now has a total of 16 production lines. The remainder of the investment would go for the upgrading of our existing manufacturing facilities in Selangor, Johor, and Taiping, so that they are compatible with Industry 4.0 standards and practices, ” Lim said.
According to Lim, the group will continue to pursue sustainable growth by driving sales growth.
In the short term, Spritzer expects a spike in sale arising from demand from consumers stocking up due to the restricted movement order.
“We certainly want to have a bigger market share in the bottled water industry. The group aims to grow its capacity and capability with more high-speed automated bottling lines, ” he said.
Spritzer spent RM60mil in 2019 to build the recently completed automated warehouse in Taiping.
“This automated warehouse, which will be operational in the second quarter, will be able to support a much larger business volume.
“Our warehouse operations will be more cost-effective over the longer term. “We foresee a significant improvement in loading time and delivery efficiency, ” Lim said.
Lim said that Spritzer Group had the most comprehensive range of bottled water products in Malaysia.
“After Chinese New Year, we added two variety of ‘BonRica HydrateDay’ drinks to our BonRica range of products. “BonRica HydrateDay” replenishes water, electrolytes, and energy lost during our daily activities and exercises.
“In 2019, we have also added some smaller pack size bottled water products to cater to the different needs of our consumers. We will continue to monitor and respond appropriately to the market demand and the needs of our customers and consumers, ” he added.
According to Lim, with consumer sentiment trending lower since 2019 and the disruptions caused by the recent outbreak of the coronavirus Covid-19, the group is cautious of its sales performance in the short term.
“However, we are confident that the demand for our bottled water will remain firm over the long term due to our strong brand equity and the consumers’ general preference for healthier beverages.
“The outbreak of coronavirus has caused a lot of uncertainties and disruptions in the marketplace. The consumption of bottled water could be affected in the near term.
“The contribution from our trading operations in Guangzhou, which generates less than 5% of the group’s revenue, will be negatively impacted during this period, ” he said.
Spritzer currently exports to the United Kingdom, Holland, Singapore, Brunei, Hong Kong, and China.
“The export sales contribute less than 10% contribution to our revenue. We aim to grow the contribution from export sales to more than 10% in three years, ” he added.