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This article first appeared in The Edge Financial Daily on September 14, 2018

KUALA LUMPUR: Dataprep Holdings Bhd, which has been in the red since 2008, expects to return to profitability soon following its decision to venture into e-wallet services, mobile apps and system integration.

“With these new areas of business that we will venture [into], we are confident that the company can be turned around, the soonest by this current financial year ending March 31, 2019 (FY19) or the latest by FY20,” said group managing director Mohamad Sabir Mohamad Sabri.

“There are a lot of opportunities in this [Industrial Revolution 4.0] segment which Dataprep has not gone into previously, so now we also want to join the bandwagon,” he told reporters after the group’s annual general meeting yesterday.

Dataprep’s net loss doubled to RM5.05 million in FY18 from RM2.54 million in FY17, despite revenue rising 4.73% to RM47.16 million from RM45.03 million.

For the first quarter ended June 30, 2018 (1QFY19), the information technology solutions provider’s net loss widened to RM2.68 million, from RM65,000 in 1QFY18, while revenue fell 52.5% to RM6.27 million from RM13.21 million.

“The huge loss in 1QFY19 is due to insufficient revenue contribution from our existing businesses and some contracts expiring as well,” Mohamad Sabir said, adding that Dataprep is now creating new revenue streams with recurring income to support the group.

Mohamad Sabir, who was appointed on Nov 15, 2017, said the group is looking for recurring and sustainable income.

“What we are building up now is to sustain the company; that’s why we have new products and services. We target the mass market because that will provide us with a recurring and more sustainable income.

“When we took over the company as the new management, our target was to make sure the company turns around within two financial years. We are putting things in places like infrastructure and new products and services,” he added.

Next January, the group will enter the mobile wallet space with the launch of its e-wallet services after starting a pilot run in November.

“We want to introduce these e-wallet services among our own university students under Widad University College, for the students to use it at the cafeteria and in paying their fees,” he said.

Subsequently, the group will introduce the services to primary and secondary school children to enable canteen operators to reduce their transaction time after receiving approval from the related authorities.

“We will implement this cashless payment at school canteens so that the payment process can be fast and the students will have more time to spend during recess to do other things,” said Mohamad Sabir.

On the system integration segment, Mohamad Sabir said the group will provide one particular system within the whole ecosystem to integrate the existing system. “This allows them (the clients) to serve many users at one time,” he said.

Dataprep shares closed unchanged at 22 sen yesterday, with a market capitalisation of RM92.7 million.

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