Techna-X Bhd is looking forward to completing the sale of its legacy industrial coke business, which has been a drag on its earnings, and sees “no issue” in completing the exercise.
It hopes to return to the black this year.
The company changed its name to Techna-X from Sino Hua-An International Bhd last December to reflect its new business as a provider of digital ecosystems and energy storage solutions.
“Divesting our industrial business will return our group to the black and we target to do it before the year-end,” executive director Datuk Jared Lim says.
Techna-X’s net losses came in at RM23.9mil for the first quarter ended March 31.
The company reported massive losses in the previous two financial years – RM192mil in financial year 2019 (FY19) and RM189mil in FY20. It is also carrying liabilities of RM132mil made up of other payables and accrued expenses.
It is understood that the bulk of this represents amounts owing to vendors.
Nevertheless, Lim is confident of Techna-X’ s prospects. He points out that the company is one of the few on Bursa Malaysia with “proprietary technology and products”.
Since changing its business direction, it has acquired six companies for about RM140mil, which was financed via internally-generated funds.
“We are excited about the projects the team is working on. The Covid-19 pandemic has caused delays on the operations front and this is something beyond our control but we like what we have and how we are positioned in the market,” he tells StarBizWeek.
Techna-X’s main business is in providing digital transformation solutions and energy storage.
Within the digital transformation space, Lim says the company, whose largest shareholder is Tunku Naquiyuddin Ibni Tuanku Ja’afar, has the technology and know-how in smart city solutions, platforms, Internet of Things or IOT, and data analytics.
“To enhance our platform business, we have acquired a food and beverage business called Craveat, which is in the process of using technology to drive the business.
“Within energy storage, we have our technologies and manufacturing capability for super-high-tech batteries and a joint venture to develop low-voltage electric mobility systems,” Lim says.
He says the company expects all of these businesses to be profitable this year.
“The main profits should be coming from the digital transformation segment as it is less affected by the restrictions as a result of the pandemic,” Lim adds.
He says that currently, Techna-X has a significant orderbook to deliver these high-tech batteries for elevators in high-rise buildings. However, these orders have been delayed as a result of the pandemic and the company expects to begin servicing its clients only by next year.
Late in the game?
Is Techna-X a little late in jumping onto the digital bandwagon since many not only here, but also globally, have already done so?
“There is ‘no late in the game’ when our technologies and solutions are cutting-edge and ever-evolving,” Lim opines.
According to him, the market potential is huge and the differentiating factor for Techna-X is that it owns the technologies and has “superior” know-how.
“Just (by) looking at our smart-city platform, we have a proven product and we are working with a few states and townships to connect the community, merchants, visitors and municipalities.
“Our IoT solutions for agriculture have already been deployed in over 250,000 acres of palm oil in Indonesia and South America and we are working with a number of Malaysian estates to bring our IoT solutions and platforms to them,” Lim adds.
He says the company owns 28 patents in Ruthenium-based ultra-capacitors and batteries and this gives it a “distinct advantage” in every project that requires energy storage.
“We have barely scratched the surface in relation to tapping the market for our products and this is why we are excited about the future.”
According to him, Techna-X is in some of the fastest-growing industries in the world.
“Energy storage alone will be a US$550bil (RM2.3 trillion) industry by 2035 and global research and consultancy firm Wood Mackenzie states that the market in China alone will grow 25 times in the next seven years,” he adds.
Some 95% of the company’s customers are from Malaysia, with the remaining from South Africa, Kenya and China.
Most of Techna-X’s subsidiaries and manufacturing facilities are also based in Malaysia, with the exception of a couple which are based in Hong Kong and Croatia.
At last look, the company’s shares were at 9.5 sen apiece, valuing the entire group at RM190mil. Over the past 52 weeks, the stock has traded between 8.5 sen and 23 sen per share.