business

Central Global keep a tight grip on cash flow during EMCO, continue to tap regional markets

KUALA LUMPUR: Central Global Bhd (CGB) will keep a tight grip on cash flow to ensure business sustainability following the government's decision to extend the extended movement control order (EMCO) in certain areas Kuala Muda, Kedah, where the company's factory is located.

CGB's factory, which produces masking tapes and label stocks, has been closed since 5 July 2021, given its location in Kuala Muda, currently under the EMCO.

The factory employs almost entirely locals, with several among the 170 employees who have been with the company for more than four decades.

Executive chairman Datuk Faisal Zelman said the company have always been cautious about the outlook for this year given the uncertainties of further Covid-19 outbreaks.

"While we will continue to tap into opportunities arising from a more fragmented regional competition landscape and the sporadic local supply-chain disruption, we are also mindful of the risks," he said in a statement today.

CGB has backlog orders to fulfil, keeping the factory busy until year-end, but operations have been affected due to the EMCO, Faisal said.

"We are consistently in discussion with the authorities despite the lock down measures which have been imposed in the EMCO zones.

"We managed to obtain permission to operate on a partial basis being categorised as an essential industry during the period of the MCO 1.0, and we hope that the government will consider applying the similar regulations for the current EMCO as well," he said.

At the same time, CGB also wants to reassure all stakeholders that the management will do all it can to ensure that the business sustains and maintain operational efficiency and quality.

CGB has two scheduled meetings annually to review the manufacturing operations' internal controls to mitigate business and operational risks.

The company's lean manufacturing process ensures that costs are kept under scrutiny while driving productivity and quality through employee suggestion programmes and reward schemes.

"We will monitor the situation and continue to adhere to all standard operating procedures as laid out by the National Security Council and Ministry of Health guidelines to ensure the safety and health of employees and vendors.

"In the meantime, we have to manage our customers' expectations in fulfilling their orders," Faisal said.

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