KUALA LUMPUR (Jan 21): SCGM Bhd, the country's largest manufacturer of thermo-vacuum form plastic packaging, has appointed Sabah-based Kim Teck Cheong Consolidated Bhd (KTC) as sole distributor of its Benxon-brand food packaging and plastic cups to food and beverage retailers and manufacturers in Sabah, Sarawak and Brunei.

SCGM's managing director Datuk Seri Lee Hock Chai expects the collaboration to boost its presence in the three markets "significantly", in the coming years.

"We target to increase revenue contribution from Sabah, Sarawak and Brunei, from 3% recorded in the financial year just-ended on Dec 31, 2015 (FY15) to 15% in three years," Lee told reporters, after the signing of a memorandum of understanding (MoU) between SCGM and KTC here today.

For FY15, SCGM recorded a revenue of RM106.63 million, of which the three markets accounted for 3%.

Under the MoU, KTC will distribute SCGM's Benxon-brand products, through its 6,419 distribution points, across 18 distribution centres.

SCGM corporate affairs manager David Cheng said the three markets are relatively untapped and the collaboration would enable the group to make inroads into these markets.

KTC group executive director Dexter Lau said the partnership is expected to increase the ACE Market-listed company's sales by another 4% within one year.

"This shall be the benchmark and platform for KTC's recognition, in which we shall not be confined to consumer products, but also venturing into packaging, leveraging on SCGM's unparalleled expertises in its field," he added.

Lau noted the products of SCGM are of the biodegradable type and still not widely recognised in Sabah and Sarawak, but there are signs of consumers beginning to use such products, as their concern for health and environment grows.

SCGM shares closed at the morning session today, up one sen or 0.32% at RM3.14, with 34,800 shares exchanging hands; while KTC shares were traded two sen or 4.82% higher at 43.5 sen, with 9.62 million shares done.

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