JAG to see MCO impact, but expects recovery

Bursa listed Jag Bhd's office and recycling plant in Shah Alam

SHAH ALAM: Recycling company JAG Bhd has seen some impact to its revenue during the movement control order (MCO) period where it was not able to operate its plant.

“We are looking at a loss of revenue of about 10%-20% in the 45 days of the MCO. However, we are expecting to recover from these losses as our clients, who are mostly multinational electronic firms, have called us to clear the backlog in their factories, ” chairperson Datin Stacey Tan told StarBiz.

“Operations were halted during the first two phases of the MCO (March 18–April 2), impacting our ability to carry out the recycling processes, including collecting and transporting raw materials, ” she added.

Tan said that during this period, no revenue was generated, although fixed costs such as rental, staff cost and other fixed overheads had to be paid. “This MCO has left a backlog of contracts that we need to fulfill, ” she said.

Tan added that one of its subsidiaries, Jaring Metal Industries Sdn Bhd, had obtained approval from the International Trade and Industry Ministry to operate on April 19, with 50% workforce, while operations fully resumed on April 22.

She noted that the company’s supply chain remained unaffected by the recent MCO despite the short break.

“All our MNC contracts are still in place. Our operations are supplier-centric as opposed to being customer-centric. We produce based on how much we have sourced from our semiconductor clients, and the revenue generated is based on how much materials are procured, ” she said.

Executive director Datuk Ng Meow Giak said the company’s financial position was robust at the moment, allowing it to mitigate any impact caused by the MCO.

“Our balance sheet has always been fundamentally sound, and with operations back in full swing since April 22, we should be able to recover fully by the end of the year, ” Ng said.

Ng also said that the company was finding new customers to process waste from the oil and gas industry for better margins.