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 MYEG 0138 MY E.G. SERVICES BERHAD 1Q net profit grows 11% on higher collection from quarantine services

KUALA LUMPUR (May 30): My EG Services Bhd (MyEG) posted an 11% rise in its net profit to RM84.63 million for the first quarter ended March 31, 2022 (1QFY22), from RM76.29 million a year earlier, on higher contribution from what the group termed "Covid-19 quarantine collection services" under MySafeTravel and MySafe Quarantine, as the government closed down its quarantine centres and allowed private quarantine arrangements to be made.

The quarterly earnings improvement also came from higher transaction volumes for its existing concession services, which resulted in higher contribution from ancillary services such as fulfillment of security documents and online renewal of insurance, its bourse filing showed.

The stronger net profit came despite a 6% dip in revenue to RM161.77 million from RM171.46 million, mainly because the group previously purchased rooms upfront from quarantine hotels for the private quarantine arrangement — which resulted in higher revenue  and cost of sales in 1QFY21. From 1QFY22, the group changed to a reservation arrangement and recognised a referral fee for every private quarantine arrangement instead, which also resulted in a decrease in operating expenses.

The group declared no dividends with its latest results announcement, which saw earnings per share rising to 1.1 sen from 1 sen previously.

Looking ahead, MyEG expects to continue introducing innovative services by leveraging on new technologies in Malaysia and other markets it is operating in.

“With the government lifting restrictions put in place during the pandemic, MyEG has now embarked on bringing blockchain to the forefront by introducing a Layer 1 blockchain platform named Zetrix.

“At the same time, MyEG is collaborating with its partners to integrate Zetrix with China’s national blockchain platform, namely “Xing Huo”. With such collaboration, the group will be able to start introducing commercial services, which can be used globally,” it said.

The group said its long-term outlook remains positive, barring unforeseen circumstances.

MyEG shares rose three sen or 3.5% to close at 90 sen on Monday (May 30), giving the group a market capitalisation of RM6.67 billion.

http://www.theedgemarkets.com/article/myeg-1q-net-profit-grows-11-higher-collection-quarantine-services

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