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Corporate Overview

Since inception, logistics has been the Group’s forte and the Group had grown to become a leader in total logistics solutions, expanding its reach to China and Dubai in the Middle East. However, with the disposal of its main China operations in 2010, the Group has a diminished presence in the logistics industry and with shareholders’ approval, has started to diversify its operations into the solar energy sector.

Analysis of Financial Results

The Group recorded a lower revenue of RM16.3 million in the financial year 2017 as compared with RM21.6 million in the previous year mainly due to the disposal of subsidiary companies in the Republic of China during that year.

The Group recorded other income of RM8.5 million during the year, comprising mainly forex gains and interest income. Reflecting the difficult business environment, the Group reported loss after tax for the year amounting to RM2.6 million as compared with a profit after tax of RM3.77 million recorded in the previous financial year.

Review of Operations
  1. Warehousing in Wujiang, PRC
    All the 9 warehouses comprising 76,000 sq. meters of warehouse space at Jiangsu Wujiang Fenhu Economic Development Zone in the district of Suzhou, Jiangsu province, are fully tenanted on long term leases with built-in rental increase clauses. The Group’s management ensures proper maintenance of the facilities and the revenue stream generated provides healthy cash flow to the Group. The Group is keeping its options open on making further investments to expand the warehouse facilities in the Wujiang area.

  2. Warehousing in Dubai, UAE
    The warehouse operations undertaken in a joint venture with a local partner, National Trading and Developing Establishment (NTDE) faced another difficult year. The operations have been facing difficulties ever since global oil prices slumped in 2015. Some recovery was forecast in the year under review but due to circumstances beyond our control, the forecast recovery did not materialise. The management continues to aggressively market the Dubai facilities while at the same time undertaking further cost cutting measures. In view of the continuing difficult economic outlook, the Board is exploring all possible options to overcome the losses being incurred and is hopeful of a solution in the not too distant future.

  3. Solar Energy Projects
    The Group’s efforts to expand its solar energy operations are beginning to show results. Wholly owned subsidiary EVN Vision Sdn Bhd’s 1 MW a.c solar plant commenced operations during the year and now has a regular income stream. The new 10 MW a.c solar plant project by subsidiary company IL Solar Sdn Bhd was successfully completed in December 2017 and commercial operations commenced on 22 December 2017. The Group engages competent technical personnel to ensure both the solar plants operate at an optimum level and produce the energy forecasted. The Board is happy to note that both of these plants are now making a positive contribution to Group revenue and profitability and the Board is stepping up its efforts to undertake mor e ventures in this sector.
Moving Forward

The Group is gradually increasing its revenue stream from non-logistics businesses so as to be less dependent on the traditional logistics business. Nevertheless, logistics remains a major activity and there are continuous efforts to enhance the revenue from this activity.