KUALA LUMPUR (May 16): Gold and jewelry retailer Tomei Consolidated Bhd (KL:TOMEI) anticipates that the newly introduced Employees Provident Fund's (EPF) Account 3 will enhance consumers' spending power, potentially boosting its sales.

"The EPF Account 3 will have a positive impact on retail,” said Tomei group managing director Datuk Ng Yih Pyng at a press conference following its annual general meeting on Thursday.

Ng noted that while EPF Account 3 is expected to have a positive impact on retail activity, it may not match the substantial boost seen during the Covid-19 period, when RM145 billion was withdrawn by EPF members under various withdrawal programmes.

Effective May 11, 2024, all EPF member accounts were restructured into three categories: Retirement Account (Account 1), Sejahtera Account (Account 2), and Flexible Account (Account 3). Contributions are now divided into portions of 75% into Account 1, 15% into Account 2, and 10% into Account 3. Previously, 70% of contributions went to Account 1 and 30% to Account 2.

Account 3 allows EPF members to make withdrawals at any time, with a minimum withdrawal amount of RM50. EPF had projected withdrawals of RM25 billion in the first year following the rollout of Account 3.

With the higher gold prices and increased tourist numbers, Ng anticipates a positive outlook for Tomei’s financial performance this year ending Dec 31, 2024 (FY2024).

"We hope to perform better than last year and continue to grow moderately," he said.

Ng highlighted the positive market sentiment driven by the influx of Chinese and Indian tourists amid the ongoing visa-free entry policy.

With gold prices surging 16.1% year-to-date to US$2,391.13 (RM11,199.37) per ounce, Ng expects the current high gold prices to expand the group’s margins in the short term.

Ng shared that the group intends to expand its retail presence, with plans to open up to two additional outlets this year. Tomei currently operates 58 retail outlets.

“We are cautiously optimistic about the economy. We have signed agreements with a couple of malls and hope to open one or two new outlets by the end of this year,” he said.

Tomei had posted record-high annual net profit and revenue for FY2022, helped by the re-opening of the nation's economy post Covid-19 which then triggered revenge spending among consumers.

Net profit more than doubled to RM65.91 million in FY2022 from RM32.77 million a year earlier, while revenue rose 32.37% to RM974.34 million from RM736.07 million previously.

For FY2023, its net profit fell 29.55% year-on-year (y-o-y) to RM46.43 million, while revenue declined by 6.63% y-o-y to RM909.71 million. The lower annual net profit was dragged down by lower revenue, coupled with higher selling and distribution expenses and administrative expenses.

At noon break, Tomei's share price rose 14 sen or 8% to RM1.88, bringing the group a market capitalisation of RM261 million.

Year-to-date, the stock has jumped 49%.