Weaker ringgit a windfall for VS Industry

Gan:'The company gains on export activities'

Company MD says 90% of its products are exported

SENAI: For VS Industry Bhd, one of the top 50 electronics manufacturing service providers in the world, the weakening of the ringgit against the greenback is a windfall as it gains on export activities.

Managing director Datuk Gan Sem Yam said that 90% of the company products were exported to the United States, Australia, Japan and European countries with business transactions done in US dollars.

“Our economic fundamentals are strong and Malaysia is fully prepared, so are our local exporters,” Gan told reporters after the company’s EGM.

At the EGM, shareholders approved the one-to-five share split that will increase the number of shares from 229.86 million shares of RM1 each to 1,148.30 million shares of RM0.20 each.

Shareholders will hold five common shares for each existing share held.

He said the weakening ringgit since the last-quarter of 2014, had made the country’s manufacturing sector more competitive, especially for the export-oriented companies.

“Export-oriented manufacturers like us are allowed by Bank Negara to buy our raw materials in the US dollar and we source half of our raw materials from overseas with the rest from domestic suppliers,” said Gan.

Meanwhile, executive director Ng Yong Kang said although the weakening ringgit was a blessing for companies like VS Industry, the feel good factor would not last too long.

He said if ringgit took a long time to rebound against major currencies, it would send the wrong signal to foreign investors and fund managers that the country’s economy was in a bad shape.

Separately, Ng said the company was currently negotiating with three US-based multinationals (MNCs) to produce niche electrical products for export.

He said the company would focus on niche products in view of the competitive business environment.

“Our proven track record and good delivery system in undertaking jobs with existing local and foreign MNCs will help us to secure more new clients,” he said.

He pointed out that it had built a reputation with MNCs from Japan, Europe, the United Kingdom and the United States over the last four decades.