Thursday, December 30, 2010

MYEG ... Dec10

My E.G. Services Bhd (MyEG) is spending RM40 million on a pilot project, involving an online service tax system, that will kick off March 2011. The pilot project will involve 2,500 business outlets in the Klang Valley and will be on for a period of one year.

The online monitoring tax system will have devices and a mechanism that can monitor and track all transactions made by business outlets. Previously, these business operators had to manually submit their tax declarations, but once this system, which is automated, is in place, the need for manpower and documentation will be reduced.

We will not embark on this if it was not viable and once the device and mechanisms are in place, it will be monitored and, hopefully, the government will apply it nationwide after the pilot project ends in March 2012.

Currently, consumers are paying a five per cent service tax charge at selected businesses which will be raised to six per cent January 2011.

MyEG expected to maintain its growth momentum next year with several more projects in the pipeline.

The company spent about RM6 million in advertising and promotion annually.

For its fiscal year ended June 30, 2010, the company recorded a pre-tax profit of RM21 million on the back of RM62 million in revenue.

Meanwhile My EG Services Bhd (MyEG) may raise funds to finance the expansion of its Online Tax Monitoring System should the company receive the green light to implement the project nationwide.

MyEG is principally engaged in the business of development and implementation of E-Government services and the provision of other related services for the E-Government initiative. Its track record include linking insurance firms with the Road Transport Department for the issuance of electronic cover notes, according to MyEG’s website.

MyEG, whose earnings are derived entirely from Malaysia so far, also offers online renewal of working permit for maids. The company also acts as a link between the police and the public via email notifications of traffic summons.

MyEG’s bottomline had come in weaker due to higher operating and finance expenses. Net profit fell 37.4% to RM2.8 million in the first quarter ended Sept 30 from a year earlier although revenue rose 13.8% to RM15.47 million.

The company has cash of RM11.32 million versus debt obligations of RM5.02 million, hence, a net cash position of RM6.3 million or one sen a share.

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