5 days ago
2 
PETALING JAYA: Cymao Holdings Bhd has proposed to diversify its core business into construction, project management and related activities.
As a manufacturer and trader of veneer and plywood products, its performance has been on the declining trend with losses reported for the past three years.
The group told the local bourse that the losses were attributed to a decline in demand in the local and export market, stiffer price competition and a fluctuating cost of raw materials.
Simultaneously it has also implemented measures to improve its performance, by merging two facilities in Sabah, ceasing loss making plywood operations, as well as the disposal of underutilised land and loss making subsidiary.
Given its situation and a volatile demand and pricing for plywood products, Cymao has decided to explore new business opportunities to reduce its reliance on the plywood business.
Towards this end, it revealed that the group’s wholly-owned subsidiary Billion Apex Sdn Bhd has secured a construction contract from Special Pixel Sdn Bhd worth RM2.25 million.
It stated that the project entails the earthworks and site preparation works, demolition and removal of temporary structures, unwanted material and debris on a land in Hulu Kinta, Perak for an estimated period between Q1’21 to Q1’22.
The group stated that the project is expected to be funded mainly via progress claims and/or equity fund raising.
Moving forward, it intends to secure more construction-related contracts in the future and expects the business to contribute 25% or more to its profit.
Cymao will apply for the requisite licenses from the Construction Industry Development Board for construction-related activities in the first half of 2021.
With that the group proposes to seek for its shareholders approval at an EGM to be convened.
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