EXCEL FORCE MSC BERHAD Annual Report 2020

EXCEL FORCE MSC BERHAD - ANNUAL REPORT 2020 11 MANAGEMENT DISCUSSION AND ANALYSIS (CONT’D) The growing threats of cyber-attack to steal data and deny genuine user access to systems requires timely and effective counter-measures. To mitigate this risk, the Group tracks the latest cybersecurity trends and development, and periodically review its system security settings to strengthen cyber- defences. The Group is also finalising a comprehensive Cyber Security Policy to set a high standard of performance. The Group adopted a zero-tolerance stance on fraud, bribery and corruption in all forms. In 2020, an Anti-Bribery and Anti- Corruption Framework (ABAC) was established, with policy, code of conduct and ethic clearly articulated and published on our website. The Framework laid out the process and procedures to deal with bribery and corruption risks, and incorporated them into our existing operational workflows. Thedetail riskmanagementand internal control aredisclosed in Statement on Risk Management and Internal Control (SORMIC) on pages 35 to 38 in this annual report. The framework enables the Board to continuously identify, assess and manage risks that affects the Group. FORWARD LOOKING STATEMENT Green shoots of economic recovery are now visible as vaccine roll out accelerates in Malaysia and globally. Government worldwide continues to introduce fiscal stimulus to jump start the economy, the largest being US$1.9 trillion package by the new US administration. Central banks worldwide are also committed to loose monetary policies which will keep interest rate low for a long period of time. Amidst sustained low interest rate environment, the Group believes investors will continue to invest in stocks and other alternative products to grow their asset base. Social media driven stock investment like those by Reddit Wallstreetbet group will gather strength and grow in influence in coming years. In Malaysia, competition in stockbroking industry is also heating up. In March 2021, iFast Malaysia launched a multi- product platform on which investors can acquire unit trusts, bonds and most importantly, stocks at very low commission rate. It was zero-commission during the 1-month promotional period. The financial industry landscape is evolving and changing rapidly. There are many more choices of assets now for investors to select and grow theirwealth, achieve their financial goals. This translate to more competition for stockbrokers and demands greater innovation and uniqueness in their product and service offering to draw and maintain the attention of investors. The Group is in close contact with our current and prospective customers to understand their needs, uncover new necessities and help them achieve their business objectives. EForce intends to grow its revenue stream, optimise utilisation of resources for productive gain and improve margin. The Group regularly reviews its resource allocation to ensure our people are concentrating their time and effort on the right activities and get them done right first time. The Group will look out for good business opportunities with attractive valuation to invest in. The Group is also open to collaborate with potential partners in Malaysia and overseas to explore new business segments that leverages on the Group's technological capability and know-how in mission critical business environment. DIVIDEND The Group had declared and paid RM5.6 million dividends in FYE 2020, totalling 1.0 sen per ordinary share. EForce proposed a final single tier dividend of 0.5 sen per ordinary share, subject to shareholders’ approval in the upcoming Nineteenth (19th) AGM to be held on 27 May 2021. The dividend payout ratio (including the proposed dividend) will be 78% of the Group’s profit for the current financial year. There is no dividend distribution policy as management is of the view that adequate resources must be maintained within the Group for working capital and future expansion needs of the Group. Factors that may influence dividend pay-out includes profitability of the Group, availability of cash balance and adequacy of reserve and economic situation. 10 June