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Shopping mall suffered

totokreturn — Thu, 07 May 2020 08:51:38 +0800

KUALA LUMPUR, May 6 — Malls half-empty with long queues outside entrances manned by guards.

Most eateries shuttered.

Inside those that are open, patrons seated at tables set more than a metre apart, in a bid to reduce guest capacity, with only a handful of waiters to serve them.

For retailers, this imagined “new normal” entails painful ramifications.

With social distancing expected to remain in place for the rest of the year at least, businesses say lifting the movement control order (MCO) will do little to curb plummeting sales.

This makes tough decisions inevitable for micro and small businesses. With a tight cash flow and dwindling profit margins, only two options make survival possible — shops are either shut for good or workers get laid off.

“Many retailers are already implementing cost cuts, at least 80 per cent,” Datuk Gary Chua, president of the Malaysian Retailers Association told Malay Mail.

“30 per cent of them expect to lay workers off in the next six months.”

Culling jobs or closing shop branches will likely be the main focus for troubled retailers bogged down by piling costs, Chua said, a view underlining the weak sentiment among businesses regardless of size.

Up to 80 per cent of retailers said they have already laid out plans or are in the midst of trimming losses, the MRA president said, noting that some have carried out cost-cutting measures since last year.

Another 50 per cent said they may be forced to shutter if conditions fail to improve or state help is not extended for the next six months, according to Chua.

Consumer sentiment in the retail sector was already at low levels in the last two quarters of 2019, as inflation and stagnant wages dashed purchasing power.

Non-permanent staff were the first to go, followed by a second layer of permanent workers. For the latter, a large number have been told to go on unpaid leave or in worst cases, retrenched.

Those lucky enough to keep their jobs saw huge pay cuts of anywhere between 10 and 20 per cent. Most retail workers are low-wage earners — typically between RM1,500 to RM1,900 — which means the cuts biting into their already meagre disposable income.

For retailers, salaries account for over a third of operating costs followed by rental, according to Chua.

Retail Group Malaysia estimates RM6.18 billion is expected to be staff cost, comprising salaries and wages, allowances and contributions to the Employees Provident Fund and Social Security Organisation.

Monthly rental, even for small premises in non-premium malls, can go up to RM20,000 a month.

In premium malls located in the city centre like Suria KLCC or Pavilion Kuala Lumpur, rental for small units can be triple that, while bigger spaces can cost up to RM300,000 a month.

“Nobody is going to wait until the worst comes in the next six months,” Chua lamented.

“They’re doing what is necessary now. Even with the MCO lifted, businesses expect sales to be at best just 50 per cent of what they earned before the restrictions,” he added.

“So rather than continue making losses, they might as well close shop or cut jobs.”

Prihatin ineffective

Retailers were expected to bear RM20.48 billion in operational and staff costs during the first six weeks of the MCO alone, according to Retail Group Malaysia’s estimates.

RM14.31 billion alone was spent on operating costs that included rent, head office expenses, insurances, advertising and promotional expenses, and repair and maintenance, business paper The Edge reported mid-April.

The Perikatan Nasional (PN) government, in an effort to alleviate some of these costs, announced several measures under the RM260 billion Prihatin stimulus package.

These included wage subsidies targeted at small and medium enterprises, tax incentives for premise owners to cut rent and power bill rebates.

But for a large number of businesses, such assistance is mired in red tape. Chua claimed many have been turned away by the highly bureaucratic application process, citing the conditions set for wage subsidies as an example.

The government said it would only subsidise up to RM1,200 of a worker’s salary for enterprises that hire more than 200 people for six months, on the condition that the staff is retained.

But as businesses expect a rebound only starting next year, paying salaries even at a subsidised rate will still be costly. Chua said this makes retrenchment the more cost-effective option.

“You look at the number of claims from Perkeso... there aren’t that many because businesses feel it’s just too much hassle,” he said.

Only 6,000 unemployment insurance claims have been made to date, Perkeso revealed last week.

Meanwhile, only smaller malls are expected to benefit fully from the power bill discounts announced under the Prihatin package, the MRA president said.

Under the Prihatin package, hotels operators, travel agencies, local airlines offices, shopping malls, convention centres and theme parks are to receive a 15 per cent discount up until September.

“As for the power bill, only small malls will benefit when retailers in the bigger malls also need help. They’re the biggest employers, but they’re not getting much assistance.”

Malaysia went into its fifth phase of the MCO, also called conditional MCO, on Monday — allowing several sectors to operate fully under strict restrictions in a bid to kickstart the economy.

REDHA minta tongkat

totokreturn — Thu, 07 May 2020 08:42:11 +0800

KUALA LUMPUR: Persatuan Pemaju Hartanah dan Perumahan Malaysia (Rehda) dan Persatuan Kontraktor Binaan Malaysia (MBAM) merayu kerajaan untuk menanggung kos penuh ujian saringan Covid-19 bagi semua pekerja agar membolehkan lebih ramai pekerja dapat memulakan kerja di tapak pembinaan dan merancakkan semula aktiviti industri.

Presiden Rehda Malaysia Soam Heng Choon dan setiausaha agung MBAM Eric Yong Shang Ming dalam satu kenyataan bersama hari ini berkata, pada kadar pasaran semasa, kos bagi setiap ujian adalah sekitar RM350 hingga RM650 seorang (bergantung kepada kuantiti).
“Kos tinggi ujian bagi setiap orang diterjemahkan kepada jumlah besar yang perlu dibiayai kontraktor kerana tapak pembinaan biasanya mempunyai beratus-ratus pekerja.

“Oleh itu memberikan kos yang besar kepada syarikat pembinaan selain kos mobilasi lain serta kerugian yang ditanggung sejak perintah kawalan pergerakan (PKP) dimulakan pada 18 Mac, 2020.

“Penularan virus itu dan impak teruk daripadanya adalah sesuatu yang tidak dijangkakan, dan ia melangkaui daripada kapasiti kewangan kontraktor untuk menanggung kos itu, terutamanya apabila kewangan kontraktor telahpun terjejas akibat daripada pandemik itu.
“Satu lagi kebimbangan yang mereka berharap kerajaan boleh melihatnya dengan segera adalah kapasiti dan kepantasan pengujian Covid-19 bagi semua pekerja pembinaan,” kata kenyataan itu.

Mereka juga melahirkan harapan agar kerajaan boleh menimbang alternatif seperti Rapid Test Kit yang lebih pantas, murah dan tersedia bagi menampung sejumlah besar pekerja, dengan ujian swab PCR dilakukan hanya sekiranya berlaku penularan di tapak pembinaan atau menjalankannya secara berselang atau berpilih.

Selain itu, sekiranya didapati kontrak di tapak pembinaan gagal melaksanakan prosedur operasi tapak (SOP) seperti garis panduan yang dikeluarkan oleh Lembaga Pembangunan Industri Pembinaan (CIDB) dan menyebabkan penularan Covid-19 di tapak pembinaan, kontraktor terbabit perlu menanggung semua kos untuk membendung penularan.

Sementara itu, MBAM turut menyokong gesaan Rehda Malaysia yang dibuat pada 8 April, 2020, bagi Force Majeure Bill atau Intervensi Perundangan, sama seperti yang diperkenalkan di negara lain termasuk Australia, Ireland, Scotland, Hungary, United Kingdom (Akta Coronavirus UK 2020) dan (Akta COVID-19 (Langkah-Langkah Sementara) 2020) Singapura.

“Rang Undang-Undang ini akan melindungi semua pihak berkontrak mengikut undang-undang daripada ligitasi yang tidak perlu dan menyediakan kelegaan sementara bagi perniagaan dan individu yang tidak dapat memenuhi obligasi berkontrak mereka semasa tempoh ini yang di luar kawalan semua pihak.

“Kami meminta kerajaan untuk membentangkan rang undang-undang itu semasa persidangan Parlimen yang akan datang pada 18 Mac, 2020 dengan kadar segera kerana langkah-langkah sementara ini adalah paling penting semasa tempoh ini untuk melindungi semua pemegang kepentingan termasuk pemaju, pembina dan pembeli,” kata kenyataan itu.

Singapore oil largest trading going bankrupt

totokreturn — Tue, 21 Apr 2020 07:26:01 +0800

Lim Oon Kuin, founder of Hin Leong Trading. FORBES
Hin Leong Trading, one of Singapore’s largest independent oil traders, said that it failed to declare “about $800 million in futures losses over the years,” Reuters reported, citing a court filing dated April 17. The company is seeking a six-month moratorium on its roughly $3.85 billion debt load owed to 23 banks.

The company’s founder and director, Lim Oon Kuim, 77, was cited in the filing as taking responsibility for directing the finance department to conceal hundreds of millions of dollars in losses from appearing on the company’s financial statements.

Lim’s only son, Evan Lim Chee Meng, said in a separate filing that his father sold a chunk of the company’s oil inventories and used the proceeds as general funds, even though the barrels were pledged as collateral to secure loans from banks.

“As a result there is a large shortfall of inventory as compared to the quantum of inventory which has been secured in favor of the bank lenders who had provided inventory financing,” Evan wrote.

Evan is also a director of Hin Leong and its subsidiary Ocean Tankers, the group’s shipping arm which claims to own a fleet of more than a hundred oil tankers, but also filed for bankruptcy protection from creditors under Section 211B of Singapore’s Companies Act. Both companies are solely owned by the Lim family, according to company filings.

Hin Leong’s move to seek court protection from creditors comes as oil prices hit a two-decade low from the Saudi-Russia price war combined with weak global demand from the coronavirus pandemic. The company’s court filings indicate that its problems had started much earlier because it had been losing money for the last few years.

In a presentation to its creditors earlier this month, Hin Leong revealed it had total liabilities of $4.05 billion against assets valued at just $714 million, according to Reuters. The company did not respond to emailed requests for comment.

Founded in 1963 by Chinese immigrant Lim at age 20 with a single truck delivering diesel to fishermen and small rural power producers, the storied Singapore oil trader has grown to become one of Asia’s largest suppliers of ship fuel. Lin was ranked No. 18 on the most recent list of Singapore’s wealthiest people. He also co-owns oil storage unit Universal Terminal with PetroChina and Macquarie Asia Infrastructure Fund.