CEPCO to take advantage of GST

Concrete Engineering Products Bhd (CEPCO) will take advantage of the coming Goods and Services Tax (GST) and incorporate more exports in its business strategy.

Its managing director, Nelson Leong Kway Wah, said this strategy could potentially improve the company's sales as its exports were denominated in US dollar.

For 2014 financial year 2014, the pre-stressed spun concrete piles and poles producer registered a revenue of RM153.79 million with 24 per cent from the export segment.

"All goods exported from Malaysia would be zero-rated which means that no GST would be collected but exporters would be able to claim GST incurred in their acquisitions of supplies.

"We want to increase our presence in non-oil producing countries like Indonesia, Myanmar and Thailand," Leong told reporters after CEPCO's annual general meeting here today.

He said in June 2012, the company partnered with Sunway Bhd's indirect subsidiary, Sunway Spun Pile (Zhuhai) Co Ltd (SSPZ), to provide customers with a wider and improved range of products.

"The agreement was that if CEPCO was not able to manufacture a certain size and length of the pile, SSPZ would pick up the slack.

"When you are bidding for overseas contract and the minute you are unable to deliver according to the client's needs, you are out. This collaboration would provide us with a competitive advantage," he said.

CEPCO registered a pre-tax loss of RM400,000 for 2014 financial year compared to a pre-tax profit of RM27.49 million in the previous financial year due to lower deliveries.

"We aim to tackle this problem by importing raw materials which is cheaper to reduce production cost," Leong said.