Friday 29 Mar 2024
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KUALA LUMPUR: Malaysian Genomics Resource Centre Bhd (MGRC) expects to return to the black in its financial year ending Dec 31, 2015 (FY15), driven by a wider earnings base, after posting net losses for the past three financial years.

Chief operating officer Sasha Nordin said the ACE Market-listed company has recently diversified its earnings base to include two new business segments, namely pathology and screening services.

MGRC had invested heavily in research and development from 2012 to 2013 for the two new segments, and has begun to see the fruits of its labour as the company reported a net profit of RM497,000 in its first financial quarter ended Sept 30, 2014 (1QFY15), compared to a net loss of RM1.74 million a year earlier.

Meanwhile, its revenue had more than quadrupled to RM2.56 million for the quarter from RM605,000 in the year before.

“What we have done is we had added two new consumer segments; one is screening services, where we developed our own genetic screening products in-house and put these on the market,” he told reporters after the company’s annual general meeting yesterday.

MGRC now offers six different screening tests and sales of these tests saw an average growth of 40% in the past year.

“The next was that we actually got into the pathology business,” said Sasha, adding that its pathology segment is operated by its unit, Clinipath (Malaysia) Sdn Bhd. Clinipath is 95% owned by MPath Sdn Bhd, which is 50% owned by MGRC.

As at FY14, the pathology business accounted for about 15% of its revenue, while the screening services accounted for 5%. The analytical services made up the balance 80%.

The company also sees more potential for its analytical services segment, due to the limited supply of these services, amid an expected rise in demand for genetic sequencing and analysis in the future.

The order book for its analytical segment now stands at RM19 million, with agriculture-related analytics accounting for the majority of it.

Citing recent research reports, Sasha said the global market for genomics data analysis is estimated to reach US$8 billion (RM27.78 billion) by 2018, at a compound annual growth rate of 21%.

On that note, MGRC aims to further expand its market to other countries in Southeast Asia.

“We have been getting a lot of interest from neighbouring countries like Thailand and Indonesia, so we are working hard to capitalise on that. I believe the market in the Philippines is also quite positive, so we will be exploring that as well,” he said.

Additionally, the company will continue to expand its pathology segment by opening three more medical centres over the next three years — from its current seven — and by offering higher-margin molecular tests.

 

This article first appeared in The Edge Financial Daily, on December 11, 2014.

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