MyEG 1Q net profit up 30% on higher volume of foreign worker permit renewals

-A +A

KUALA LUMPUR (Nov 29): MyEG Services Bhd reported a 30% rise in net profit for its first financial quarter ended Sept 30, 2017 (1QFY18) to RM52.78 million from RM40.51 million a year ago, thanks to higher online foreign worker permit (FWP) renewals.

The rise in profitability was also boosted by foreign workers rehiring programme services (FWR) and foreign workers’ insurance from both the FWP and FWR, as well as stronger revenue contribution from its motor vehicle trading-related services.

Earnings per share grew to 1.5 sen in 1QFY18 from 1.1 sen in 1QFY17. Revenue for 1QFY18 grew 25% to RM98.04 million from RM78.6 million in 1QFY17, its Bursa Malaysia filing showed.

However the group said the revenue rise was offset by higher personnel related expenses and operating expenses to support the growth in FWP and FWR Services, as well as higher interest costs from the term loan to finance MYEG’s newly acquired offices, and higher depreciation expenses.

On prospects, MyEG said continued growth in volume of its existing concession-related services, primarily FWP and FWR, and the online renewal of foreign workers’ insurance, are expected to contribute positively to group revenue and net profit.

“In our financial year ending June 30, 2018 (FY18), under our non-concession related services, we have embarked on a job matching and placement programme where we will match foreign workers registered under FWR with employers who require foreign workers.

“This is a new business division under our non-concession related services which will also complement our hostel accommodation division,” the group said.

Its directors are cautiously optimistic that results for FY18 will continue to be satisfactory as more Malaysians adopt online government services as a convenient and cheaper alternative to transact with the government,” it said.

MyEG shares ended the day up 1 sen or 0.5% to RM2.02, for a market capitalisation of RM7.4 billion.