PETALING JAYA: Shipping company Hubline Bhd is cautiously optimistic of its performance for the financial year ending Sept 30,2020 (FY20), driven by its improving dry bulk business and new aviation business venture amid the Covid-19 pandemic.
Vice-chairman Datuk Richard Wee Liang Chiat told StarBiz the company has been profitable, especially after discounting the losses in its container business. The latter is also expected to come to an end as the company has completely shut down that segment in FY19. For FY20, the company expects a better set of results compared with FY19.
For FY19, the group registered a profit after tax (PAT) of RM1.26mil and revenue of RM124.46mil compared to a net loss of RM4.53mil and revenue of RM101.98mil in FY18. “Our container business was the main problem, dragging down the company’s performance. It took us a few years to get rid of this underperforming asset. With that done, we are finally able to begin a new and exciting chapter for Hubline, ” he said.
He added that the company will be focusing on expanding its fleet for the dry bulk business and aims to acquire one to two sets of barges and tugs on an annual basis.
Currently, Hubline is one of the largest tug-and-barge operators in South-East Asia with 24 sets of tugs and barges, having a capacity of 8,000 to 11,000 tonnes.
“Our ultimate plan is to make Hubline a total logistics player that offers across-the-board air and sea logistical services. We are working on this seriously and hopefully we will achieve our goals in the next few years. This is part of our effort to register better profits and create business sustainability for the company, ” he said.
He disclosed that the company will be able to recognise the full profit contribution from its aviation business segment in FY20 compared to only a quarter of its contribution in FY19. It had successfully acquired 51% in Layang Layang Aerospace on May 15 last year for RM14.198mil.
Layang Layang Aerospace is currently one of the largest general aviation companies in Malaysia, operating six units of helicopters and eight units of fixed wing aircraft covering Sabah and Sarawak.
“We are working on increasing our number of helicopters and are in the process of acquiring a Super King Air fixed wing, aiming to service regional areas such as Indonesia, Thailand and Singapore. The new aircraft will have equipments for medical emergencies, ” Wee noted. The Layang Layang Group also operates the subsidiary, Layang Layang Flying Academy in Ipoh and Kota Kinabalu.
The academy provides cadet pilot training courses for cadets from airlines as well as private students and currently has a three-year contract with MAB Academy Sdn Bhd, the education and training arm of Malaysia Airlines Bhd. Layang Layang Aerospace is a registered service provider for Petronas and intends to enter the oil and gas air transportation services with its bases in Miri and Kota Kinabalu.
“These new business ventures shall help to broaden the revenue base of Hubline into air logistics and other areas of aviation with the expectation of generating earnings for the company. The business venture is also in line with Hubline’s business expansion plan to increase its revenue base to complement our current businesses, ” he said
The Sarawak-based company announced in September that it was acquiring 75% stake in Absolute Privilege Sdn Bhd for RM16.37mil to secure tenancy for its dry bulk operations.
Absolute Privilege is a property investment company that owns land in Miri worth RM38mil. The proposed acquisition is expected to be completed by March 2020.