Regional Notes 2018.04.27

Grab’s acquisition of Uber Southeast Asia drives into problems

Go-Jek won’t, of course, take all the Uber alums, but these conditions certainly put it in a good position to cherry pick critical new hires to fill out its business outside of Indonesia. Other Grab rivals, including well-funded logistics startup NinjaVan, food delivery companies Deliveroo and FoodPanda, bike-sharing startups, and even the likes of Facebook, WeWork, Google and Netflix are understood to have hastily arranged interviews with Uber’s departing Southeast Asia staff in a bid to suck up new talent. That’s precisely the scenario that Grab is trying to avoid.

Integrating the ‘unbanked’ into a cashless society

In Malaysia, the population of the unbanked stood at 8% or two million of the country’s 24 million adults, according to Bank Negara Malaysia (BNM) in its Financial Stability and Payment Systems Report 2017. While this may seem small in comparison to regional neighbours such as Indonesia and the Philippines whose unbanked make up more than half the population, there is still a need to address this segment if Malaysia aims to be a full-fledged cashless society.

Lotte Chemical Titan sees no margin pressure ahead

“Our business is a margin game. As long as there is demand coupled with a limited supply, our margin will be maintained. Currently, there is limited supply capacity, and there are no new plants coming on stream until 2019.”

The group is looking to build a naptha cracker with a capacity of one million tonnes, next to its existing plant in Merak, Cilegon, Banten province of Indonesia. The mega project, estimated to cost between US$3 billion and US$4 billion, will take about three to four years to complete. Indonesia remains a crucial market for the group, as it is a net importer of petrochemicals backed by a huge population of nearly 300 million.

“When we sell in Indonesia and Malaysia, we enjoy a slight premium over international prices. [So] we are looking at duplicating our Malaysian facilities in Indonesia, and increasing the capacity as well.”


Hap Seng to buy Mercedes’ commercial vehicle business

Hap Seng said it and MBM will jointly undertake a stock take in respect of the fixed and current assets to determine the final purchase consideration. The group opines that the proposed acquisition will enable it to participate in the wholesale distribution of Mercedes-Benz and Fuso commercial vehicles in a growing domestic market.

On completion, Hap Seng Trucks will be responsible for handling the import, assembly, wholesale distribution and after-sales services of Mercedes-Benz and Fuso commercial vehicles in Malaysia. However, the business transfer is conditional upon Hap Seng obtaining the licence to import complete knocked down components from the international trade and industry ministry, which is required to carry on the business.


Nestle Malaysia hopeful to achieve RM400m sales from new products in 2018

Last year, the food and beverage manufacturer’s new products launches contributed about RM380 million sales. Hofbauer pointed out the company’s sales target contribution from new products would derived about 10 per cent of its domestic sales. Hofbauer said Nestle will also be allocating RM180 million in capital expenditures to grow its culinary and confectionery products as well as to enhance infrastructure manufacturing.

Currently, domestic consumption contributes about 80 per cent of Nestle Malaysia’s sales, while remaining 20 per cent for export market. “We export to over 50 countries including in the Middle East and South East Asia to Nestle’s affiliates,” he said, noting that the export value constitutes about RM1 billion. Nestle Malaysia manufactures and markets more than 500 halal products and the country is the biggest Halal producer for Nestle.


PetDag upgrading petrol stations and opening 15 new stations

The company, which has a capital expenditure of RM300mil for the year, has seen its previous and ongoing promotions boost fuel and non-fuel sales, with its retail segment continuing to be its highest revenue contributor.

“We have the largest network in Malaysia today with about 1,045 stations. The key focus for us will not be to grow the network much, although we are looking at opening 10 to 15 new stations. We are focusing more on upgrading our existing stations and particularly our convenience stores to boost sales. In 2017 and moving into 2018, we already have initiatives to assist dealers face the challenging market. We are revising the licence fee, providing better royalty programmes and offering better sales incentives for our dealers.”

“The volatility (in crude oil and pump prices) impacts working capital and gains or losses on inventory. To manage this, we are pushing for ultimate efficiency in managing inventory – our inventory holding days are now between four and four-and-a-half days.”

In the commercial segment, the company holds about a 70% share of Malaysia’s aviation jet fuel market, and recently secured deals with three more international airlines.

Intraday short selling measures claims first victim – Unisem

“To a certain extent, perhaps IDSS would exaggerate the downward pressure on stocks, but it won’t be severe. Regulated short selling (RSS) has already been in the Malaysian market for a while. In the latest measure, Bursa Malaysia further allows the PDT to do IDSS, which simply means they need to close out their positions within the day.”

RSS involves borrowing shares of a company’s stock and selling it with the hope it can be bought back at a later date at a lower value. Meanwhile, naked short selling involves betting that the stock will go down in price without actually borrowing the stock or finding out if there is available stock to borrow in order to short it. This can cause further volatility or leave a stock open to manipulation. RSS was banned in Malaysia in September 1997, but was reintroduced in 2007. Investors can participate in RSS so long as they have a stock borrowing and lending agreement approved by the Securities Commission.

Company Notes 2017.11.10

PIE Industrial Q3 FY2017 Results

One major customer of our EMS segment changed its receiving system in March 2017. As there was a major technical glitch discovered in their new system, the customer is unable to process their payments to the Group. Based on our Group’s policy on credit control, we are required to provide impairment for doubtful debts which are overdue over a certain period, therefore a provision of RM11.243 million is made during this quarter. Management estimates that these debts will be able to collect by the fourth quarter and maintaining such provision during this quarter is necessary in accordance with our Group’s policy.

The major source of revenue and earning of the Group comes from its manufacturing segment (98%). For EMS activities (77%), orders are expected to increase steadily from existing customers and potential customers through its fully built-up vertical integrated manufacturing facilities which have been in operation for the past 5 years.

Revenue derived from the manufacturing activity of raw wire & cable (18%) will continue to grow, with consistent profit margin for the rest of the financial year. The cost of its two main raw material i.e copper and PVC are expected to increase in the near future, enhancing its selling price and securing more orders from its customers.


Hartalega Q2 FY2018 Results

Prospects for the rubber glove manufacturing sector remain strong with increasing demand arising from switching trends towards nitrile glove. Nitrile glove now accounts for 61% of Malaysian rubber glove export. Hartalega NGC is on-schedule to meet this rising demand with progressive commissioning of Plant 4 and started the construction of Plant 5. The increasing contribution of NGC to Group sales revenues would help to consolidate margins and contribute further to Group earnings.


Tasek Q3 FY2017 Results

The Board expect the prospects for the rest of the financial year to remain challenging due to the weak prices of cement caused by the intense pricing competition and over capacity. Infrastructure roll-outs may be insufficient to make up for the present lull in demand for cement primarily caused by the soft property market.


Shangri-La Hotels Malaysia Q3 FY2017 Results

In particular, Shangri-La Hotel Kuala Lumpur is expected to achieve improved operating results for 2017 as it continues to reap the benefits of its newly renovated banqueting facilities and all-day dining restaurant. In addition, Hotel Jen Penang should continue to grow well, after the completion of its major renovation programme in June 2017. The hotel’s enhanced room product and facilities should support further increases in occupancy and room rates.


Petronas Dagangan Q3 FY2017 Results

In the current quarter ended 30 September 2017, the Group has disposed 100% equity interest in a subsidiary, PETRONAS Energy Philippines, Inc (“PEPI”) and 40% equity interest in an associated company, Duta Inc to P-H-O-E-N-I-X Petroleum Philippines, Inc., an external party of the Group for a fair value consideration of RM560.5 million resulting in a gain on disposal of RM424.6 million.

Malaysian CAB’s Indonesian venture to start

While the construction of the entire farm will take up to five years, it is hoped that by the second year of construction, the Indonesian operations will have the capacity to produce some four million broilers per month and three million eggs per day.

“According to an Orissa International report, global poultry consumption is predicted to grow by 27% to 28 million tonnes by 2023 – with 40% of that growth in Asia. In South-East Asia, the growth of incomes, population, urbanisation has translated into a growth of demand for animal products. The surge in demand for animal protein resulted in a significant increase of meat – mainly poultry and pork. Poultry is the largest livestock sector in Malaysia, Thailand, and Indonesia. Malaysia’s poultry meat per capita consumption is among the highest in the world, consumed 1.8 million chickens and 2.8 million chicken eggs daily.”

“Indonesian poultry production is estimated at €10bil (RM49bil) in 2015 with broiler meat accounting for three-quarters of the total. The poultry meat sector is projected to grow 70%-90% by 2020 if GDP increases by 6% per annum. The layer industry is also projected to grow at 50%-60% of the broiler sector.”


Not your typical manufacturer

Being a Tier-1 manufacturer, with research and development (R&D) and engineering capabilities that match that of a design house’s, Lim said Salutica co-develops products with brand owners instead of just manufacturing based on specifications given by clients.

However, maintaining that Tier-1 manufacture’s standard comes with a high cost, Lim admitted. Unlike many second- or third-tier manufacturers, Salutica is Responsible Business Alliance (RBA)-compliant, a code of conduct that Lim said the top 100 technology companies in the world — including many of its customers — subscribe to and impose on their Tier 1 suppliers.

“Fobo Ultra for commercial vehicles was more complicated than we initially thought. Negotiations with fleets and logistics firms took longer than expected because most fleet owners were sceptical about a product that was made in Malaysia. But [sales] have picked up slightly at home,” said Lim. All MRT (mass rapid transit) feeder buses in Malaysia under the Volvo brand, according to him, have been equipped with Fobo Ultra since the end of last year.


Kronologi to enlarge footprint through Quantum

“With this development, we could leverage on the collective experience of the enlarged team for best practices for vertical solutions and provide additional analytics, which include artificial intelligence. Currently, we’re collaborating with some other technology players to provide these additional solutions. We’re anticipating some form of AI solutions by next year but it’s an ongoing process for us.”

“Moving forward, once the acquisition is completed, Hong Kong will play an important role. Similarly, earnings growth should be quite evenly distributed among Singapore, India, Hong Kong and Southeast Asia (excluding Singapore).”


Hexza’s bottom-line to take a hit from RM28.5mil provision

This is not the first time Hexza has made an impairment loss of finance lease receivable due to the Tembusu Industries Pte Ltd’s payment default. In FY17, the Ipoh-based company made an impairment loss amounting to RM6.95mil, being the amount due but not paid by the lessee.

To recap, on Jan 30, 2015, Hexza inked an agreement with Tembusu to buy part of the equipment for a 8MW heavy fuel oil power generation system located in Myanmar from Tembusu for US$6mil (RM25.3mil), after which Tembusu would lease back the equipment from Hexza at a monthly rental of US$130.205 (RM549,937) for 10 years.


F&N poised for stronger FY18 after restructuring

“Now we want to build exports as our third pillar on top of our existing markets in Malaysia and Thailand,” said Lim. The company is looking to achieve stronger top and bottom lines — at levels seen in FY16 — next year, he added. “We have set a target for annual exports to hit RM500 million by FY20,” said Lim. The company is not looking to export excess capacity, he said, but will instead increase its output for the segment.

F&N is undergoing a three-year RM500 million capacity expansion plan which it initiated in FY17. It has completed four milestones with five more upgrades to go, which Lim said are on track to be completed separately in FY18 and FY19.

“We are also de-bottlenecking some facilities. These require much smaller capex (capital expenditure) at around RM5 million per project,” said Lim. “While the value is smaller, a simple upgrade can increase the annual output of our dairy product manufacturing plant in Pulau lndah by one million crates, for example,” he added.

F&N foresees the bulk of its exports to revolve around dairy products, said Lim, which provide higher margin — at between 10% and 12% — compared with other products such as packed beverages.

Over-regulation a hurdle for free zone operators

The PKFZ was initially modelled after Dubai’s Jebel Ali Free Zone, which is such a success that it contributed over 20% of Dubai’s gross domestic product. More than 30 other free zones have been set up in the United Arab Emirates, which were modelled after it.

The GST Act is deemed to have superseded the Free Zone Act 1990, taking away some advantages available under the Free Zone Act for free trade zones such as the PKFZ.

“So today, as far as free zones are concerned, the supply of goods is not an issue, but [the] supply of services is — as tax is applicable. They (customs) say it can be claimed back. But do you understand how business is done in the free [trade] zone? There are foreigners there. If you tell them that in order for them to claim back the tax, you have to employ an agent and other requirements, they will say ‘Why is it so difficult? In Singapore, there is no such issue’.”

Malaysia signals shift to tightening stance on growth view

Southeast Asian policy makers face rising pressure to start preparing for rate increases in the face of higher U.S. borrowing costs. Bank Negara Malaysia is forecast by economists as among the first to move. The economy is stronger with the government predicting growth of at least 5 percent until 2018 as it boosts infrastructure.

Inflation quickened to a five-month high of 4.3 percent in September, but is projected by the government to average between 3 percent and 4 percent this year. A general election due to be held by August 2018 is among reasons the central bank may hold off from raising borrowing costs just yet.


Focus on affordable housing may hurt private developers

“Over the past three years, government agencies’ participation filled the gaps nicely as private developers went through a gestation period to move towards the smaller-margin affordable housing segment. But moving forward, when supply keeps up with demand, government agencies and private developers will begin to compete on an unlevel playing field.”


Malaysia’s giving working moms a better maternity deal than U.S.

In a country where women are likely to drop out of the labor force when they have children, Najib is making a push to reverse that. He’s giving women a one-year tax exemption if they return to work after a break of two years or more, offering longer paid maternity leave for some and reducing working hours for others. In the U.S., there’s no national requirement for paid maternity leave.

Malaysia is losing out to low-cost and low-end manufacturing newcomers like Vietnam, but lacks the kind of skills and innovation that’s propelled Singapore and South Korea to more advanced status. Najib’s target is to make Malaysia a high-income country in the next three years, a feat that would require boosting per-capita income to $12,476 — which is the level the World Bank uses to define a high-income nation — from about $10,000 now.

Company Notes 2017.10.13

LPI Capital Q3 FY2017 Results

“With its diversified distribution channels especially its strong agency network, Lonpac has continued to build its market share in the newly liberalised environment. Its gross premium income for the third quarter grew by 34.6% to RM416.6 million from RM309.6 million registered in the previous corresponding quarter. Lonpac’s profit before tax for the quarter under review similarly registered an impressive 20.3% jump to RM102.4 million from RM85.1 million previously. With its prudent underwriting policy and costs control measures, Lonpac managed to improve its combined ratio to a new record low of 63.9% for the third quarter of 2017, reduced from 65.0% reported in previous corresponding quarter. As a result, its underwriting profit registered a strong improvement by 19.9% to RM83.6 million from RM69.7 million previously, despite its claim incurred ratio having increased marginally to 40.3% from 38.9% previously.”

Lonpac has established a Digital Strategy Department to leverage on technology to distribute its products and to further enhance its services to our customers. We believe that investment in technology will enable us to further expand our business segment and strengthen our market position.


Zhulian Q3 FY2017 Results

We also look forward to improving the contribution from the MLM segments especially from our Thailand and Myanmar markets in order to drive growth momentum for overall Indochina market once we materialise our plan to enter Cambodia and Laos market. The Group will continue to adopt rationalisation in our business operations.


Atlan Holdings Q2 FY2018 Results

Duty free segment reported lower profit in current quarter and cumulative quarter as compared to the corresponding quarter and cumulative quarter in the previous year mainly due to lower revenue as lower demand from customers following the imposition of Goods and Services Tax at the border outlets and duty free zones with effect from 1 January 2017, coupled with higher management fee incurred. However, the decrease was partially offset by savings in transportation costs.


Top Glove Q4 FY2017 Results

The uptrend in sales revenue also came on the back of an increase in average selling prices (ASP) arising from a surge in raw material prices, as well as a strengthening of the USD over the course of FY2017. Additionally, more sales of nitrile gloves, which command a higher ASP, coupled with new capacity, also helped move sales revenue figures higher.

…the signing of a letter of intent to acquire the entire ordinary shares of Eastern Press Sdn Bhd, a printing and packaging material manufacturer for RM47.25mil. The proposed transaction is expected to provide the Group with synergistic benefits, enabling it to improve its supply chain coordination, thereby allowing for flexible planning and better delivery time in relation to the supply of packaging material for its glove products, as well as better cost and quality control.

Vitrox investing RM130mil to expand ops

According to Chu, the important growth segments are the automotive and telecommunication infrastructure industries.

“The report expects China to continue to be the world’s largest car market for the foreseeable future, and has upgraded its 2017 China forecast to 28 million units.”

“The total spending on endpoints and services will hit almost US$2 trillion in 2017.”

“We shipped out 106 units of advanced optical inspection and advanced x-ray inspection equipment for used in the electronic assembly industry. Only 1% of our shipment goes to the smart device segment. We are, therefore, not subjected to the volatility of sales in the smart device market. The second half of 2017 should see double-digit growth for all the four sectors over the same period last year and also the first half of this year.”


Choo Bee upbeat about steel price rally

“We have seen the price [of steel] really move up since July. It has hit [a five-year] high at the moment. At RM3,000 per tonne, it’s an extremely good price. It’s really a positive development for us. We’re seeing demand rising now. The construction industry is getting more active in the second half of the year. Since the third quarter, we have seen more orders coming in, and we expect the momentum to continue in the fourth quarter.”

Presently, its manufacturing segment makes up 40% of the group’s revenue, while its trading segment contributes the remaining 60%. The domestic market makes up the lion’s share or 95% of the group’s sales. Its only export market now is Singapore. Tan said Choo Bee intends to re-enter the US and the Middle East in the long run, but gave no timeline.

In the mean time, Choo Bee is looking to set up another new factory as part of its 10-year expansion plan. “Everything is still in planning stage … it will be in the Klang Valley. It will be near our existing warehouse in Kampar because we want to centralise everything. It makes more logistical sense,” Tan said. Choo Bee’s sole factory in Pengkalan, Perak, which produces about 110,000 tonnes per annum, is now running at about 75% capacity.


George Kent partners Siemens for HSR bid

Under the deal, George Kent and Siemens will form an engineering, procurement and construction (EPC) pre-consortium to prepare a joint offer on the EPC level to the special purpose company which shall bid for the development, financing, construction and technical operation and maintenance of the Kuala Lumpur-Singapore HSR.


Petronas Dagangan in joint venture to install EV charging stations

Through this tripartite partnership, Petronas Dagangan commits to install 100 ChargEV stations by 2018 and will explore strategic partnerships to increase the number of ChargEV stations gradually, in tandem with market demand. Petronas Dagangan will also look into installing solar PV panels at 100 selected stations. With this, the energy used to power the ChargEV stations will be fully renewable and completely carbon-free, making it truly green.


Rubber glove exports to hit all-time high

The Malaysian Rubber Glove Manufacturers Association (Margma), in a statement yesterday, said it had increased this year’s export sales target to RM16.2bil amid strong demand from overseas. The figure is almost RM3bil higher than what was achieved in 2016.

“As of the present situation, all glove manufacturers are oversold and selling beyond their capacity to produce by over three or four months behind due to demand and labour shortage issues,” Margma president Denis Low Jau Foo told StarBiz when contacted yesterday.

Despite the challenges, Low said rubber glove exports from Malaysia are expected to reach close to 150 billion pieces this year. It is estimated that exports from Malaysia accounted for two-thirds of global consumption.

“This is the more recent factor apart from the continued increase in hygiene awareness among the population worldwide. In China, the government has been actively closing vinyl glove factories which do not comply with environmental regulations. Due to this, there has been a vacuum over the past few months from the reduction of producers in China today. And I expect China’s actions to continue further in the near future. Over there, it is the vinyl gloves while over here, we have the nitrile and latex rubber gloves.”

Charting Naza’s direction

The focus of the second generation was to put a framework of corporate governance and professional managers in place at the key business divisions of the group. Nasarudin says his late father had about 100 active companies when he passed away and the group had no holding company. The problem they faced was the need to consolidate everything over the past seven years and put the right structure in place.

Apart from the auto business, which accounts for 60% of group revenue, the group’s other large business interest is in property development. That division, headed by Faliq, has seen sales rise from RM200mil to about RM1bil and is said to be valued at RM3.5bil – ripe for a listing on the stock exchange. It has 400 acres of land for mixed integrated development in the Klang Valley, but the weak sentiment in the domestic market has forced it to look abroad for opportunities. “We are sitting on very strategic land bank and with Platinum Park, we are the second-largest land owner at KLCC. At KL Metropolis, we are sitting on over 70 acres. When it comes to prime land, we are taking our time in realising that value,” says Faliq.


Malaysia Airlines mulls stake sale to another carrier

“It’s the trend these days; that’s what’s happening. Other airlines, they take a portion of somebody else, get really close [working] together … what it does is it generally lifts overall value, and you have other commercial operation opportunities, maybe you can have joint purchasing, maybe you cooperate on aircraft, you have the same product line, that’s the trend where the industry is going, and it makes a lot of sense. It allows for balanced growth. If you look around the world, a lot don’t have partners in Southeast Asia.”

Bellew acknowledged that Malaysia Airlines will remain loss-making in FY17 which is within expectations. “I think we are on track to be profitable in the second half of next year.”

Malaysia addressing inaccurate claims in EU draft palm oil report

The European Parliament had also endorsed the certified sustainable palm oil (CSPO) plan for Europe-bound vegetable oil exports to ensure that they are produced in an environmentally sustainable way.

Describing the draft report as the “wish list” of MEPs, Kalyana stressed that the EU Parliament has no rule-making authority. “It’s not a EU policy; it’s just recommendation from the parliament,” Mossenlechner told reporters.

The resolution calls for the EU to discontinue the usage of vegetable oils in biodiesel by 2020 on the grounds that they were allegedly produced in an unsustainable manner leading to deforestation.


Digital banking penetration to exceed 60% by 2018

This was well below the more than 90% penetration seen in South Korea, Australia, Singapore, Hong Kong and Taiwan, but above the rates of Indonesia, Thailand and the Philippines.

“Phase one of fintech disruption involved fintech start-ups disrupting the banking industry by offering their services directly to consumers, completely independent of banking industry players. However, now fintechs have realised how costly it is to acquire customers on their own, so there is a shift seen in these start-ups to providing business-to-business solutions, so they are looking for partnerships with bigger and more established banking players to offer customers a joint value proposition.”


Here’s why Malaysians can’t afford a house

Just 20 percent of new Malaysian housing launches in the first quarter were priced below 250,000 ringgit ($59,000), down from 33 percent between 2010 and 2014, according to the central bank’s “Housing Watch” website. The bulk of new homes cost between 250,000 ringgit and 500,000 ringgit. The median annual household income is estimated at around 63,000 ringgit.

Only about half of people living in Kuala Lumpur own a home, while nationwide the number was 72.5 percent at the last census in 2010. Demand is set to rise: the median age of Malaysia’s 31.7 million people is 28 years and the nation’s urban population is growing at an average 4 percent a year, among the fastest pace in East Asia, according to the World Bank.

“The focus should be on building houses which people can afford, not building expensive houses and then trying to push them, and then complaining that the banks are not giving loans,” he said. “The reason people are having problems getting loans is because the houses are not affordable. It’s beyond their repayment” ability, he said.


ABM ‘strongly refutes’ recent REHDA claim on difficulty to secure housing loans

The overall housing loan approval rates remains high at 73% of the applications in the second quarter of 2017. Furthermore, ABM said 72% of the housing loan borrowers are first-time house owners under the affordable home category.

ABM said its 27 member banks take an average of two to nine working days to process a housing loan application with complete documentation submitted by the applicant. “Therefore, the 60 to 90 days taken for loans approval as stated by Rehda is not reflective of the speedy approval process of housing loans by banks.”


Malaysians’ median monthly household income rises to RM5,228 in 2016

Seven states surpassed the national median monthly household income of RM5,228, namely, the Federal Territory (FT) Kuala Lumpur (RM9,073) FT Putrajaya (RM8,275), Selangor (RM7,225), FT Labuan (RM5,928), Johor (RM5,652), Melaka (RM5,588) and Penang (RM5,409).

On consumption expenditure, he said Malaysians spent an average RM4,033 a month, an increase of 6% from 2014. “Almost 70% was spent on four main groups, namely, housing, water, electricity, gas and other fuels (24%), food and non-alcoholic beverages (18%), transport (13.7%) and restaurants and hotels (13.4%). The scenario is in line with the composition of a developed country’s spending pattern.”


Malaysia should ease migration policy

“In receiving countries, foreign workers can fill labour shortages and promote sustained economic growth, if migration policies are aligned with their economic needs. Inappropriate policies and ineffective institutions mean that the region is missing opportunities to gain fully from migration. These restrictive policies are partly influenced by the perception that an influx of migrants would have negative impacts on receiving economies. However, there is evidence to the contrary.”

All said, Malaysia and Singapore have the lowest international labour mobility costs in Asean, which reflect their openess to globalisation, their efforts to develop migration system that meet labour market needs and their geogrphic centrality in the region.


Minimum wage to go up

This would be the second time in three years that minimum wage levels in the country have been revised. In July 2016, The minimum salary was raised to RM1,000 from RM900 in Peninsular Malaysia, and to RM920 from RM800 in Sabah, Sarawak and Labuan.

“We know that the minimum wages order must be reviewed at least once in two years. The review will look at the ability of the employer to pay the minimum wage which is a responsibility that is very challenging to ensure that the minimum wage policy meets all objectives”, Riot was quoted by Bernama as saying.