SYF STEPS UP DOWNSIZING EFFORTS
Company plans another round of labour cuts and asset sales worth RM48 million
SYF Resources Bhd is intensifying its downsizing efforts as the company braces for another lossmaking year. It is set for another round of foreign labour cut, land and factory sales worth RM48 million and continuous streamlining of manufacturing facilities in its furniture segment.
Executive director Keith Ng Wei Ping said the company would focus solely on property development as early as 2021.
He said its furniture business had suffered from weak demand, mainly due to the lacklustre economic environment.
“The local demand for solid rubberwood and components has been weak. Consumers now look for cheaper substitutes.
“We also face a challenging environment in the export market due to strong competition from local suppliers with a competitive advantage in overhead costs such as labour and transportation,” he said after the company’s annual general meeting here yesterday.
“We will be aggressive in our rationalisation move to break even sooner,” he added.
Ng said the company was in talks with prospective buyers to dispose of its remaining land and factories in Semenyih.
“The proceeds would be utilised to pare down our borrowings. We are building up for liquidity to take advantage of any future opportunities that may arise,” he said.
SYF Resources had previously set aside RM15 million that it obtained from the disposal of Great Platform Sdn Bhd to Mieco Chipboard Bhd, earlier earmarked for land bank acquisition, for its debt rationalisation move.
The company fell into the red in the financial year 2018, with a net loss of RM14.12 million compared with a net profit of RM34.9 million in the preceding financial year, mainly due to its furniture business.