KUALA LUMPUR (July 17): BIG Industries Bhd (KL:BIG) has announced the cessation of its concrete business division, in a bid to mitigate losses.

In filing with Bursa Malaysia, BIG Industries said that its loss-making concrete division has operated in a "very competitive price sensitive business environment" served by operators like the company and contractors who have their own on-site batching plants and casting yards. 

The division was managed by three of its wholly-owned subsidiaries, namely Uni-Mix Sdn Bhd (UMIX), Uni-Mix Concrete Products Sdn Bhd and Kinalaju Supply Sdn Bhd. UMIX’s property development business will continue as usual.

Over the past two financial years, the concrete division has incurred losses before tax of RM660,658 for the financial year ended June 30, 2022 (FY2022), and RM157,619 for FY2023. For the nine months ended March 31, 2024 (9MFY2024), the division’s losses before tax amounted to RM446,599.

BIG attributed these losses to low demand, falling below the breakeven point, and a lack of construction-related activities in the areas where it operated. With the cessation of the concrete business, operational losses are expected to cease.

"As part of the cessation of business, the assets will be available for sale to the highest offeror. All proceeds (less any associated expenses) arising from the sale of the assets will be utilised for working capital purposes," it said.

BIG sees the cessation of business as having no material financial impact on FY2024 and envisages the asset disposal being completed by Dec 31, 2024.

Shares in BIG gained one sen to 71.5 sen on Wednesday, valuing the company at RM46.02 million.