Operations and Business Environment - The Group's operations are primarily located in Malaysia, providing system integration and IT-related services since 2006[19]. - The COVID-19 pandemic created a challenging economic environment, impacting project negotiations and delaying existing projects[20]. - The implementation of nationwide Movement Control Order (MCO) in Malaysia adversely affected business operations[20]. - The ongoing COVID-19 pandemic has significantly impacted operations, leading to project delays and a slowdown in customer purchasing decisions[70][71]. - The Group is actively pursuing new projects and investments to enhance its business performance and maintain operational stability amid ongoing challenges[23][25]. Financial Performance - For the year ended November 30, 2021, the Group recorded a total revenue increase of approximately 71.6% to approximately RM17.2 million, up from RM10.0 million in 2020[31]. - Revenue from system integration and development services increased by approximately 67.2% to approximately RM13.5 million for the year ended November 30, 2021, compared to RM8.1 million in 2020[33]. - Revenue from IT outsourcing services surged approximately 163.9% to approximately RM2.9 million for the year ended November 30, 2021, up from RM1.1 million in 2020[38]. - The Group's gross profit increased from approximately RM1.5 million in 2020 to approximately RM2.7 million in 2021, with a gross profit margin rising from approximately 14.9% to approximately 15.7%[44][45]. - Administrative expenses decreased by approximately 7.3% to approximately RM9.1 million for the year ended November 30, 2021, down from RM9.8 million in 2020[46]. - Finance costs decreased by approximately 13.3% to approximately RM72,000 for the year ended November 30, 2021, compared to RM83,000 in 2020[47]. - The Group recorded a loss of approximately RM6.3 million for the year ended November 30, 2021, an improvement from a loss of approximately RM11.2 million in 2020[49]. Strategic Initiatives - The Group aims to strengthen its core business by seeking appropriate investment opportunities[20]. - The Group plans to leverage business networks of Pre-IPO Investors to introduce IT products from the PRC into Malaysia and diversify service offerings[25][27]. - The Group aims to be a major IT solution provider for digitalization in Malaysia and to capture new growth opportunities through its successful product, Square Intelligence[25][27]. - The Group is focused on capturing new growth opportunities in the Small and Medium Enterprises segment as part of its future business strategy[80]. - The Group is actively participating in digital transformation tenders initiated by the Malaysian Government and government-linked companies[81]. Product Development and Innovation - The Group's product, Square Intelligence, has been successful since its introduction, with ongoing development of advanced features incorporating machine learning capabilities for data extraction from unstructured sources[94]. - The advanced version of Square Intelligence, which includes machine learning capabilities to extract data from unstructured sources, has been completed and launched during the year[96][97]. - The Group has developed the advanced version of its mobile payment application, Blackbutton 2.0, which is ready for market launch[85]. - The Group is exploring the feasibility of entering the Small and Medium Enterprises (SMEs) market by developing digital solutions, with a blueprint expected to be completed by Q2 2022[99][101]. - The first solution to be developed will enable businesses to operate a digital ordering process, with plans to incorporate a cashless payment feature[133]. Risk Management - The Group has identified principal risk factors, including dependency on major customers and project-based contracts, which may affect future revenue streams[109][110]. - The Group continues to enhance its product and service offerings and implement marketing activities to secure new contracts and attract potential customers[111]. - The Group's collection progress on overdue trade receivables has been consistent despite pandemic-related challenges[115][116]. Human Resources and Employee Welfare - The Group is committed to enhancing employee knowledge and service quality through training programs[139]. - The Group participates in a mandatory provident fund scheme in Hong Kong, contributing 5% of employees' relevant income, capped at HK$30,000 per month[143]. - The Group contributed approximately RM629,000 to the retirement benefit schemes for the year ended 30 November 2021, compared to RM602,000 in 2020, reflecting an increase of about 4.5%[145]. - The Group is required to contribute a certain percentage (6%-13%) of payroll costs to the Employees Provident Fund (EPF) in Malaysia, fulfilling statutory requirements[144]. - The Group's only obligation regarding the retirement benefit scheme is to make the specified contributions, with no forfeited contributions available to reduce existing levels[145]. Management and Governance - Mr. Chong, the founder and CEO, has been instrumental in developing the Group's self-developed IT products, NS3 and CUSTPRO[149]. - Mr. Liu has over 25 years of experience in finance and accounting, currently serving as an executive director and CEO of Asia Resources Holdings Limited since April 2017[155]. - Mr. Siah, a non-executive director, has experience in business intelligence and data warehousing, having founded CSS MSC Sdn. Bhd. in 2005[162]. - Mr. Chan is the chairman of the remuneration committee and a member of the audit committee and nomination committee[174]. - Mr. Su is the chairman of the nomination committee and a member of the remuneration committee and audit committee[179].
九福来(08611) - 2021 - 年度财报