Will OWG 5260 ONLY WORLD GROUP HOLDINGS BERHAD stage higher growth after a strong turnaround?

 Will  OWG 5260 ONLY WORLD GROUP HOLDINGS BERHAD stage higher growth after a strong turnaround?



Only World Group Holdings Bhd (OWG) was one of the actively traded counters on Bursa Malaysia on May 2.


It gained some 5% to close at 62 sen on that day.


Although it is still below its 52-week high of 70 sen, it has surged from its low of 39 sen.


Investors’ confidence has turned positive mainly due to the company’s improved financials.


For the 2nd quarter ended Dec 31, 2022, it returned to the black with a net profit of RM1.7 million from a loss of RM418,000 a year ago.


The better results were on the back of doubling of revenue to RM36.7 million to RM17 million.


OWG is a strong beneficiary of the recovery play after being a victim of the Covid-19 pandemic.


OWG, which is listed in 2014, manages and operates F&B and leisure-related brands found in popular resorts and shopping malls.


Chances are many of us have visited OWG’s water pak in Shah Alam, its entertainment/leisure parks in Genting Highlands such as Ripley’s Believe It or Not! Odditorium in Ripley’s Adventureland and Jurassic Research Center.


Another of its attraction is the TOP komtar, Penang with panoramic view of the island.


But since it is involved in the tourism industry, the onset of Covid-19 has heavily affected the group's operation.


Its revenue from food service segment as well as the amusement and recreation operations were down 79% yoy to RM25 mil in FY21.


The company went into the red in FY20 (the first loss-making FY since it was listed), and the loss widened to RM42 mil in FY22.


Luckily, things are looking rosier for OWG as the economy picks up.


Already there is a steady recovery of the customers' confidence level and consumer behaviour which lead to a higher footfalls to the Group's food service outlets, amusement and recreation parks.


For OWG, its higher revenue surged due to an increase in business volume as a result of more mid-term school holidays and public holidays.


The Malaysian economy is expected to expand at a more moderate pace in 2023 amid a challenging external environment.


As of 21 June, Malaysia has already surpassed its full-year target of 2 million incoming tourist arrivals.



Genting Highlands, where most of its outlets are located and made up 40% of OWG's bottom line back in 2019, has seen its footfall gaining traction.


In view of strong recovery momentum especially in the second half of the year (seasonally stronger earnings), be prepared to see greater business volume in its F&B outlet and family attractions and thus better earnings going forward.
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