13 GHL SYSTEMS BERHAD 199401007361 (293040-D) ANNUAL REPORT 2021 3. PERFORMANCE BY BUSINESS SEGMENT AND GEOGRAPHY (Cont’d) 3.1 Performance By Business segment (Cont’d) a) Transaction Payment Acquisition (“TPA”) Segment (Cont’d) (i) e-pay (reload and collection services) (Cont’d) A full year’s comparison of key data between 2021 and 2020 relating to the e-pay business is found in Table 1 below. The transaction payment value by e-pay grew by 12.8% in 2021. The Gross Revenue/Transaction Value declined by 4.1% to 2.75% in the year due to changes in the product mix as well as the merchant mix in which these transactions occurred. Table 1 e-pay (All stated in RM'millions unless stated otherwise) YTD 2020 YTD 2021 % change Transaction Payment Value 4,324.6 4,876.2 12.8% Gross Revenue 123.8 133.9 8.2% Gross Revenue/Transaction Payment Value (Note 1) 2.86% 2.75% -4.1% Gross Profit 43.4 45.0 3.7% Gross Profit/Transaction Payment Value (Note 1) 1.00% 0.92% -8.0% Merchant Footprint - e-pay Only (Thousands) 42.3 49.0 15.7% Note 1 – Gross Revenue or Gross Profit respectively divided by the Transaction Payment Value expressed as a %. (ii) GHL (electronic payment services) This electronic payment services business is driven by TPA arrangements with leading domestic banks in the respective markets as well as a leading China e-wallet provider which is expanding into ASEAN. The existing GHL TPA data, as shown in Table 2, comprises the following activities: a) Various merchant discount rate (“MDR”) revenue sharing arrangements under direct contracts with merchants and banks in Malaysia, Thailand, and Philippines. b) Domestic debit card merchant acquisition. c) E-commerce TPA (“eGHL”). d) e-wallet providers in Malaysia, Thailand and Philippines. A summary of key data relating to the electronic payment business is found in Table 2 below. While transaction payment value grew by 20.4%, overall revenue improved by 27.3% due to merchant mix as well as payment type mix which impacts the overall MDR (gross revenue/ transaction value) which improved to 0.52% from 0.49% in 2020. Over the longer term, however, margins should stabilise as more merchants are on board and a larger portfolio is built as overseas TPA in Philippines and Thailand gather momentum. The introduction of domestic e-wallets in all three markets continue to grow and gain further acceptance by consumers in 2021 and this trend is expected to continue going forward. MANAGEMENT DISCUSSION AND ANALYSIS CONT’D
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