Business

Tuesday June 19, 2012

RM26m lost in China ops sees GHL Systems seeking opportunities in Asean market

By NG BEI SHAN
beishan@thestar.com.my


KUALA LUMPUR: GHL Systems Bhd, an end-to-end payment services enabler, would focus on Asean after irregular transactions in the China operations led to substantial losses last year.

The company posted an RM26mil lost for the financial year ended Dec 31, 2011 in the China unit besides a write-down in the value of some of the assets.

“In the immediate and mid-term future, we will not go back to China. There are enough opportunities in our neighbouring countries with a population of 600 million,” executive chairman Loh Wee Hian said after the company's AGM and EGM.

“Our target is to be one of the leading payment solutions providers in this region. We hope that by 2015, not less than 50% of our top and bottomline will come from this region.

“This is in line with Malaysian banks, like Maybank and CIMB Bank, wanting to be regional players.”

Currently, 20% of the firm's revenue comes from its foreign units in countries such as Thailand and the Philippines.

“GHL is not a domestic company. We position ourselves as a regional player. We are also looking at opportunities in Indonesia.

“The use of electronic money in place of cash is increasing and the population in this region is young. So, we are in the right place, right time and right business.

“As for the other markets, we are looking at the Middle East, South America, and Eastern Europe. We have no intention to set up offices there, so we will appoint resellers,” Loh added.

Chief executive officer Kanagaraj Lorenz said he was confident the company would turn around, helped by its focus on increasing recurring income through renting its electronic data capture (EDC) terminals and expanding its solutions services and transaction payment acquisition (TPA) business.

“The income from EDC terminal rental is more predictable and consistent as compared with sale of the terminals.

“We are not paying dividends for these two financial years (2012 and 2013) as the company can earn higher yields through reinvesting in the business.

“We will make money but it won't be spectacular this year,” he said.

As for the TPA segment, the company has been working closely with Malaysian Electronic Clearing Corp Sdn Bhd, a wholly-owned subsidiary of Bank Negara, to provide an ATM PIN-based payment known as e-Debit to merchants.

Executive director Ng King Kau said: “We are expanding our own sales force regionally and in important secondary cities like Penang, Johor Bahru, Kuching, Kota Kinabalu and Kuantan.”

He also said they were looking at increasing the TPA operation's sales growth by no less than five times within the next two years.

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