ATS eyes returning to the black
Company says it is reaping benefits of investment made last year
GEORGE TOWN: After three consecutive years of losses, AT Systematization Bhd (ATS) looks to return to the black in 2021.
The company’s group managing director Choong Lee Aun told Starbiz that ATS invested Rm 16.6mil in late 2018 as part of its business strategy to make the group profitable again.
“Our investment paid off as it helped us to secure a long-term contract with Rieter, the world-renowned manufacturer of systems for short staple fibre spinning.
“We are looking to generate a yearly sales of Us $2.6mil annually by the 2021 financial year.
“By next March, the contract in hand from Rieter should be around Rm2mil.
“Rieter’s willingness to purchase from us high precision machining components show that our products comply with their stringent quality and standards,” Choong said.
In late 2018, the group’s investment went into renovating and equipping its second plant in Bayan Lepas with the machinery and equipment to produce high precision machining parts for Rieter.
“This plant will also be used to produce electronic gaming equipment in early 2020 for the local gaming market.
“This is another new business that will help us to be profitable in 2021.
“The gaming equipment will be marketed under our own brandname, which we expect to generate about 10% of our revenue in 2021,” Choong said.
According to Choong, the group has started to use the renovated facility to make sheet metal for US multinational corporations involved in providing electronic manufacturing services (EMS).
“Since December 2018, the group has commenced its operation to provide machining solutions including metal cutting using fibre laser technology, punching, bending, forming and deburring.
“Under the EMS business segment, we are producing 500 different types of machining components that are used in EMS equipment.
“The expected sales of the EMS segment for the 2020 financial year ending March 31 is about Rm8mil,” he said.
Choong added that a year ago, the group obtained the ISO 13485 certification, enabling the group to be a certified contract manufacturer of endoscope and endoscopy accessories metal parts.
“The group has started producing fabrication orders for two additional new medical customers in the financial year 2019,” he said.
As of March 31, 2019, the group’s cash and cash equivalents stood at Rm0.83mil, decreased by Rm8.77mil from Rm9.6mil a year ago mainly due to investing Rm9.04mil for the expansion of the group’s manufacturing facility to accommodate a sheet metal fabrication production line.