My EG Services Berhad Annual Report 2019

MY E.G. SERVICES BERHAD [Registration No. 200001003034 (505639-K)] 12 MANAGEMENT DISCUSSION AND ANALYSIS On behalf of MYEG, the management of MYEG (“ Management ”) is pleased to provide an account of the Group’s financial performance as well as the business and operational highlights for FP2019. "T BOOPVODFE UP #VSTB .BMBZTJB PO +VOF BOE 4FQUFNCFS .:&( IBE DIBOHFE JUT àOBODJBM ZFBS FOE GSPN +VOF UP 4FQUFNCFS GPS '1 BOE TVCTFRVFOUMZ GSPN 4FQUFNCFS UP %FDFNCFS GPS '1 The Malaysian economy continued to expand in 2019, with ongoing income and employment growth underpinning private consumption spending. However, the overall pace of economic growth continued to moderate, dampened by more subdued private investment amid heightened global trade uncertainties, as well as softer government expenditure and investment. Exemplifying resilience and by diligently executing its business and operational strategies, MYEG continued to achieve progress during a challenging year. Prevailing against an uncertain operating landscape, the Group has continued to create value and has enhanced value creation processes for the long-term. We have remained proactive in strengthening our business model and have displayed agility and adaptability to respond effectively to the various developments in a dynamic operating environment. Importantly, we have continued to bolster our financial performance while ensuring business and operational sustainability. Our Annual Report captures the Group’s journey; in how we have strengthened our position as a leading provider of e-government services and other relevant digital and commercial services in Malaysia as well as abroad. COMMITTED TO VALUE CREATION A more detailed account of our value creation process is provided on page 31 to 40 of this Annual Report. Our FP2019 report further embodies the principles and content elements of <IR> towards providing more comprehensive disclosure on our business model, business and operating strategies, risks and opportunities; and our consumption of capital resources and future strategic priorities. Management is of the view that continued adherence to the guiding principles and content elements of the <IR> Framework prescribed by the IIRC will further illustrate the distinct means by which MYEG, as an industry leader for digital services, creates sustainable value for all stakeholders. FINANCIAL PERFORMANCE Notwithstanding broader economic uncertainties, MYEG continued to demonstrate resilience, delivering another solid financial performance in FP2019. The performance is a testament to the vital role the Group continues to play in providing digital services and innovations that remain essential and relevant in the lives of citizens, the government and businesses. In FP2019, bolstered by strong transaction volumes for our services, MYEG recorded robust revenue and earnings. Revenue for the financial period was RM593.58 million (FP2018: RM562.27 million), while profit before tax was RM306.94 million (FP2018: RM128.47 million). MYEG’s net earnings per share stood at 8.6 sen (FP2018: 3.6 sen). Revenue and earnings were bolstered by contributions from the Group’s concession-related services such as Immigration Department and Road Transport Department (“ JPJ ”) services and their related ancillary services. Also underpinning the top and bottom lines were the Group’s array of commercial offerings, including motor vehicle trading related services, financing services, foreign worker recruitment and placement related services, and contribution from Cardbiz Holding Sdn. Bhd. and its subsidiaries, which is principally involved in the deployment of payment solutions as well as hardware and merchant acquiring services. Consistent with previous financial periods, digital and commercial services accounted for around 80% of the Group’s revenue as compared to e-government services which accounted for around 20% of the Group’s revenue.