Kontena exploring JVs in logistics sector

KUALA LUMPUR (Dec 18, 2012): Kontena Nasional Bhd is in talks with companies both foreign and local for potential joint ventures (JVs), strategic alliances and partnerships in the logistics sector, said its CEO Hood Osman.

"We will not depend on organic growth alone. After a while, the cost and revenue stream will hit a saturation point. Once you hit a saturation point, there is no growth," he told reporters at a media luncheon here yesterday.

"We need to maintain the margin. So, we need to be imaginative on how to do things."

The third party logistics provider is currently in talks with several parties involved in the warehouse management and distribution, freight forwarding and container haulage for possible JVs, strategic alliances or partnerships.

"There are nearly 2,000 freight forwarders in the country. Most of them are not asset base. If you are able to support with the infrastructure that Kontena Nasional now has, it will be win-win situation for both," said Hood.

Kontena Nasional has set a revenue growth of RM334 million for the current financial year ending Dec 31, 2012, from RM234 million in FY11, driven by organic growth and new businesses.

For FY13, it is targeting a 25% growth in revenue.

"Over the last two years, (revenue) growth has been ranging between 20% and 25%," said Hood.

"We have made good grounds (in 2012). Our margins have improved.

"For FY13, focus will be on streamlining our internal operations and people. If you take a look at the industry at large, the driver (of growth) is from the manufacturing sector and we are moving towards the fast moving consumer goods segment," he said.

The company is expected to clinch two major aeronautical contracts next year, as part of its plan to expand into other sectors.

The contract will be for three years, said Hood but declined to elaborate.

Currently, Kontena Nasional has strong presence in the oil and gas sector as well as a "fair bit" of government work, he added.

 - THE SUNDAYDAILY