Spritzer soaks in the success

SPRITZER Bhd continues to chart its future both locally and abroad as the next generation takes over the reins of the company.

The company hopes for stronger product penetration abroad eventually as it continues to benefit from a strong brand presence at home, from its 36 years of operations.

Spritzer is led by executive director and group chief executive officer Kenny Lim, the son of its founder Datuk Lim Kok Boon, its managing director.

Its main production base for mineral water is in Taiping, Perak. The company has a second mineral water plant in Yong Peng, Johor, with a drinking water plant in Shah Alam, Selangor.

It is Malaysia’s largest and most integrated bottled water producer with a market share of more than 40%, according to its annual report.

It produces 1.25 billion litres of bottled water a year.

The bottled water industry is highly fragmented with many players with many companies having come and gone over the years.

The listing of Sabah-based drinking water company Life Water Bhd on the Main Market of Bursa Malaysia last November also drew attention to this industry.

As top and bottomline growth continues, profit margins have also grown in recent years.

This is likely due to its new packaging which saw slightly decreased volumes per bottle which in turn also requires less handling or transportation costs per unit.

Following the launch of its redesigned bottles in mid-July 2022, net profit margins have climbed to double digits.

The company appears to now be capitalising on the years of investments into building up its capacity and brand name locally.

Net profit margins was at 12.3% in its financial year 2024 ended Dec 31 (FY24) which was a rise from 10.1% in FY23.

This metric was at 8.5% in FY22, 7.3% in FY21, 8.3% in FY19 and 6.9% in FY18.

“I believe we will be okay. We have confidence that this strong growth will be maintained in spite of the recent increase in minimum wages.

“Educating the masses on the benefits of silica through marketing programmes and the resurgence of inbound tourism is also sustaining this growth,” Kenny tells StarBiz 7.

“On top of this, we have also opened up a lot of channels. Previously we weren’t that aggressive in this regard. We are aggressively growing the hotels, restaurants and cafes segment or Horeca,” he adds.

Kenny also notes of the new bottle designs have helped it grow sales as well.

Spritzer’s revenues saw a strong year-on-year jump of 30.9% in FY22 while it grew 18% in FY24.

“We will keep launching new products this and the next year in order to sustain our growth.

“This year, we are still expecting double digits growth in both revenues and net profits. We hope to achieve this on organic growth,” Kenny says.

Apart from growth locally, the company would like to grow its export markets as well.

“Our exports are still very small at 3% to 5% of revenue.

“We want to grow this to at least 10% in the next three years or so.

“We are developing our markets in Singapore and Brunei now. Singapore will be key as we want the brand to go there first to be known as a natural mineral water brand there.

“There is a good opportunity here for us,” he says.

The company sometimes acquire lands to ensure the environment around its mineral water catchment areas is sustained.

Last year, it acquired seven parcels of land totalling some RM9.3mil in Taiping and Yong Peng. As at the end of FY24, it had 433 acres in Taiping and 54 acres in Yong Peng.

“We will always acquire parcels of land as finding mineral water is not an easy task. We buy this land to also protect the environment,” Kenny says.

In January, the company announced that its unit Angenet Sdn Bhd had acquired 27 acres of agricultural land in Batu Pahat, Johor for RM5.7mil.

Kenny says the company is allocating slightly less than RM100mil this year for the expansion of production lines for its 9.5-litre bottles and its factory in Yong Peng, Johor.