KUCHING: Swee Joo Berhad expects its four chemical tankers to be fully operational this year to sustain its earnings from its foray into liquid bulk shipping especially the transportation of Crude Palm Oil.

SJB chairman Alexander Nanta Linggi in a press release said: “Barring any unforeseen circumstances, we are optimistic about the group’s ability in sustaining the current turbulent market environment.

“We are continually looking at ways to diversify our earnings so as not to be too dependent on one particular industry.

“Our foray into liquid bulk shipping especially transportation of CPO with a fleet of four chemical tankers will provide Swee Joo with stable income in the future as palm oil is still very much in demand.”

On the financial aspect, SJB recorded a jump of 5.9 per cent on a turnover of RM86.4 million in first quarter of 2008 to RM91.5 million in the first quarter this year.

However, the result for the current quarter is a loss before taxation of RM3.55 million as compared to a profit before taxation of RM9.45 million in the same corresponding quarter last year.

The decline in profit before taxation during the current quarter under review reflects the impact of various factors on the shipping industry worldwide such as the substantial drop in load factor as a result of the global financial crisis.

The situation also impacts the demand for goods and thus reduces the cargo available for shipment.

According to SJB, the group’s losses before taxation increased from RM1.49 million to RM3.55 million in the current quarter as compared to the preceding quarter due to the decrease in activity level after the festive season and the worldwide economic slowdown, which reduce the demand for goods

The largest contribution of the group’s financial performance is still dependent on the demand for shipping services, which are cyclical in nature.

As a strategy to move forward to meet the current challenges of the slower economic growth arising from the global financial crisis, the group has focused it efforts to restudy some of the routes, lowering the operational cost and improving the load factor through the disposal of older vessels to reduce the excess capacity.

SJB has no other corporate proposals for the current quarter under review besides the proposed Employees’ Share Option Scheme (ESOS) of up to 15 per cent of the issued and paid up capital of SJB, which are given to eligible employees.