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Chairman's Message

 

Dear Shareholders

On behalf of the Board of Directors, I am pleased to present the Annual Report and the Audited Financial Statements of Tasek Corporation Berhad for the financial year ended 31 December 2017. 

This financial year 2017 ended with the Group recording a profit after tax of 1.01 million on revenue of RM549.11 million. 2017 was a difficult year for the Group compared with the previous year which saw profit after tax of RM50.33 million with revenue of RM654.79 million. The low profit after tax for the year was the result of sluggish demand for cement arising from the weaker than expected absence of job-flows from the private sector property market and overcapacity in the cement industry. The existing large-scale property and public sector infrastructure projects were insufficient to drive demand for cement during the year. The lull in the demand for cement was further exacerbated by lack of new infrastructure roll-outs during the year and the prolonged intense price competition among the manufacturers which had affected the Company’s margins resulting in an operating loss of RM16.9 million in the cement segment for the year. However, its ready-mixed concrete segment achieved higher operating profit of RM7.0 million for the year compared with RM6.2 million previously. The Company’s share of profit of RM2.67 million from its associated companies was better than the previous year’s share of loss of RM1.59 million. 

The Board expects the prospect for the coming year to remain challenging and has expressed cautious optimism as the Group moves forward under the present scenario of market conditions and continued price competition. We anticipate construction works on the government’s public infrastructural projects of MRT2 (SSP Line) and the LRT3 (Bandar Utama-Klang Line) slated for this year to alleviate the weak demand for cement. Against this backdrop of market conditions and price competition, the Group remains steadfast in maintaining its commitment to improving operational efficiency and performance accountability, and to drive business growth in a sustainable manner. The Board took steps during the year to reorganise its manpower structure for organisation agility and will continue to keep the Group lean with continuing cost optimisation. 

The 15th Collective Agreement was signed towards the end of the year with the Cement Industry Employees Union for another three years to expire on 30 June, 2019. We thank the unionised employees for their engagement and commitment to maintain harmony and to the Company’s culture of performance accountability.

This year the Company will be holding its 57th Annual General Meeting on 24 April, 2018 and the Board has the pleasure of inviting shareholders to attend the meeting which will be held at Millennium I, Lobby Level, Grand Millennium Kuala Lumpur, 160 Jalan Bukit Bintang, 55100 Kuala Lumpur, Malaysia. Please refer to the Notice of the 57th Annual General Meeting and its accompanying notes in this Annual Report for further information.

On behalf of the Board, I thank the shareholders, our management team and our employees, Union members, distributors, customers, suppliers, transporters, business partners and other stakeholders for their continuing support to the Group.

 

KWEK LENG PECK

Chairman

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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