ENRA Group Berhad Annual Report 2021

CORPORATE GOVERNANCE ENRA Group Berhad | Annual Report 2021 48 H. How we Manage our MSMs (Cont’d) 1. Material Economics Sustainability Matters (Cont’d) iv. Workplace efficiency A number of initiatives to enhance workplace efficiency have been established. a. CSI and Process Shredding The Group’s CSI has been an effective tool instituted by the Group and encourages employees to work on achieving either: • Cost avoidance; • Cost reduction; • Cost containment; and • Value enhancement. The combination of perpetual drive for new CSI ideas and more WFH hours has resulted in the process shredding exercise that not only reduces operational cost but also improves the processing speed and productivity; particularly with regards to the procurement and accounting work flow whereby: • less keying in and clicking of buttons are needed; • shorter action time for each step; • shorter waiting time from one step to another; and • reduction in printing cost as well as we migrate to digital processing. b. On an aggregate basis, the Group’s operating expenditure (excluding exceptional items) has actually decreased by RM11.4 mil since last year as shown in TABLE 9 TABLE 9 Group FY2017/18 RM’000 FY2018/19 RM’000 FY2019/20 RM’000 FY2020/21 RM’000 Revenue 75,286 164,706 226,646 112,799 Operating expenses (excluding EI*) 28,433 30,475* 35,873 26,599* OPEX-revenue ratio (%) 37.8% 18.5% 15.8% 23.6% * The exceptional items in respect of FY2018/19 were in relation to impairment loss on trade debtor under liquidation of the remaining RM15.3 mil and the written down of the London flats by RM9.3 mil. The exceptional items in respect of FY2020/21 were in relation to RM8.5 mil goodwill impairment loss and RM1.2 mil in relation to the MSS. c. Decentralisation and manpower review In FY2020/21, more emphasis was made on decentralising the functions done at Group level down to the respective companies as well as a critical review of the manpower requirement relative to base revenue size. Consequently, the Group has executed a MSS to right size the Group in the fourth quarter of FY2020/21 with 10 people leaving the Group from several companies. The fairly generous one-off MSS compensation costed RM1.2 mil in FY2020/21 but will saved the Group RM1.3 mil per year moving forward. The job roles and functions of the MSS participants had been allocated to the remaining staff relatively smoothly. The RM1.2 million MSS cost is an exceptional item to the income statement. The management does not expect any more MSS to be carried out. SUSTAINABILITY REPORT