GHL System Berhad Annual Report 2019

G H L S Y S T E M S B E R H A D 1 9 9 4 0 1 0 0 7 3 6 1 ( 2 9 3 0 4 0 - D ) 18 5. FUTURE PROSPECTS The Group continues to focus on merchant acquisition across the five markets by offering clients payment options ranging from credit/debit acceptance, mobile payments as well as internet payments. The emergence of QR based e-wallets have spurned growth of domestic e-wallet players in 2019 and saw the accelerated deployment and launch of several local players in this space, especially in Malaysia. This bodes well for GHL, as it increases the competitive edge in offering merchants an integrated omni-channel payment solution. In 2020, the Group will be focussing on strengthening its positioning in Malaysia, Philippines, and Thailand. The Group will also be commencing acquiring at a stronger pace in Indonesia and Cambodia. Although TPA is a key focus, the group recognises that the payment infrastructure within the markets it operates in remain under developed. Opportunities remain in the traditional space of EDC hardware sales and rental, and payment network infrastructure, and GHL remains well positioned to capitalise on this growth area. The outlook for 2020 and beyond remain optimistic. 2020 started on a cautious footing with news of a flu like epidemic which eventually turned into COVID-19, with the World Health Organisation declaring it a worldwide pandemic on 11 March 2020. ASEAN countries had seen the COVID-19 outbreak worsened towards the end of 1Q20, with governments initiating movement restrictions and border controls in March 2020. Movement Control Order to stay at home and the closure of most businesses and economic activities save for essential services had adversely impacted consumer spending. The Group’s services are deemed to be essential services in the countries it operates in, as GHL provides payment services for businesses and consumers. GHL Group initiated its Business Continuity Processes (BCP plans) to enable operations across the region to continue operating. Amidst this, the welfare and health of the Group’s employees remain an utmost importance in these unprecedented times. Given the Group’s diverse range of merchant base, some of the payment touchpoints such as convenience stores, pharmacies, medical facilities, supermarkets, and petrol stations are still functioning throughout the movement control period. However, as most of the businesses in the retail, leisure, tourism and other sectors were closed, the Group’s TPA business was adversely affected. The economic challenges from COVID-19 , global oil price decline, and the resulting impact on consumer spending across the global economy will have an impact on the performance of the group in 2020. However, the group takes a cautious view on the speed of the economic recovery and maintain a medium and long term view on the payment industry, and remain positive on the future of cashless payments. 6. DIVIDENDS The Board of Directors has decided that our cash reserves can be better used to further grow the Group's business in the various ASEAN markets it operates in and therefore do not recommend the payment of a dividend for the financial year ended 31 December 2019. MANAGEMENT DISCUSSION AND ANALYSIS CONT’D