MESB Bhd has proposed to diversify into the waste recycling business to include the collection and recycling of wastepaper, plastics scrap and scrap ferrous metal.
It pointed out that it has incurred losses in three of the past five financial years, particularly for the financial year ended June 30, 2020 in which it reported a loss after tax of RM26.78 million due mainly to the impairment losses on intangible assets in the retail segment amounting to RM25.17 million as a consequence of the Covid-19 pandemic.
The Malaysian Plastics Manufacturers Association estimates that the plastics recycling industry produces 1.5 million tonnes of recycled resins a year worth RM4.5 billion in revenue, and exports roughly 70% of its production. For this undertaking, the group acknowledged that it does not have any historical track record in such business but its director and major shareholder Wong Sak Kuan has experience in the recycling business through his involvement as director and controlling shareholders in companies in the recycling sector.