AFTER achieving strong performance in the financial year 2021 ended Dec 31 (FY21), JAG Bhd is looking forward to more growth.

       The group, which was formed following a reverse takeover of Infortech Alliance Bhd in 2014, has benefited from the surge in commodity prices.

       The e-waste recycler counts processing and extracting of non-ferrous metals and precious metals from electronic components as its core business.

       This business contributed some 93% of its revenue in FY21.

       Most of its sales are from selling recycled copper or copper which has been extracted from electronic components obtained from e-waste.

       “In 2021, 74% of sales in our total waste management division was contributed by the sales of copper, followed by other precious metals,” Jag’s chairman and executive director Datin Stacey Tan Siew Ching tells StarBizWeek.

       She notes that there will always be a good demand for secondary metals as they have a lower cost compared with primary metals.

       “We are confident of another solid financial year backed by external factors such as the macro environment and prices of commodities which are on an encouraging trend. Commodities such as copper, silver, tin, and nickel are trending upwards,” Tan adds.

       The ACE Market listed company’s FY21 saw a broad-based recovery where net profit more than doubled year-on-year (y-o-y) to RM19.2mil while revenue rose by 40% to RM223.8mil.

       Tan hopes that the company would be able to ride on the growth in the electric vehicles (EV) market which requires some of the raw materials that Jag processes.

       “The semiconductor industry, which we are dependent on for raw materials, remains positive, underpinned by developments in 5G, Internet of Things and EV too,” Tan says.

       “Globally, demand for chips is expected to remain strong in 2022. The EV market in particular is growing in demand. The production for EV requires a significant volume of copper, nickel and tin, which in turn, will bode well for the group,” she adds.

       The company recently won a tender from Bank Negara to buy and meltdown cupronickel and nickel raw metals as scrap metal.

       “This is a one off contract which we are working on now and this will help bolster our earnings for FY22,” Tan says.

       She notes that FY22 is expected to see about a 10% growth in revenue.

       “We are continuing to work towards securing more long-term contracts from multinational corporations,” she adds.

       The company is also planning for an increase in its capacity as it is anticipating demand for its services to rise.

       “We are planning to allocate some RM50mil for investment and capital expenditure which will be funded by borrowings and internally generated funds. We are also in discussion stage to acquire a factory,” Tan says.

       “In case the acquisition does not materialise, we will consider building a new factory on our vacant land,” she adds.

       Meanwhile, the environmental, social and governance (ESG) agenda also remains a priority for the company.

       “We have implemented several sustainable efforts, including the installation of solar panels and the switch to using gas for the heating process, which will continue to drive savings for us,” Tan says.

       “We were using diesel before. Now 87.5% of our plant uses natural gas. We could not convert one piece of equipment to use natural gas as we were not able to attain the required temperature,” she adds.

       Jag also has a presence in the manufacturing of ice cream and the coin-operated laundry business.

       Last year it ventured into the ice cream business under its unit Jag Scoops Sdn Bhd and Tan says this business is expected to breakeven next year.

       “The group has completed the 100% acquisition of Jag Scoops, and we are in the midst of rebranding, following which, the business will be named ‘Frost n Bites’,” Tan says.

       Meanwhile its launderette business, that operates under the Bubblelab brand, is recovering, following a headwind prior to this from the Covid-induced lockdowns.

       Jag had invested into this business back in 2015 together with the owners of Bubblelab Laundry Sdn Bhd. It had a startup initial working capital of RM4.25m and now has 13 outlets.

       “The cash flow is stable for all outlets of the launderette business. We have a total of 13 outlets located in high density areas within the Klang Valley,” she says.

       “The revenue contribution from this launderette business to the group is approximately 1-2%. This business is dependent upon the availability of high-density locations, which is a vital component to the success of this business,” Tan notes.