Pappajack optimistic amid pawnbroking’s growth

KUALA LUMPUR: Pappajack Bhd remains cautiously optimistic, noting that pawnbroking continues to serve as an essential alternative financing channel for individuals and small firms.

The pawnshop operator said the group will continue to strengthen its pawnbroking operations through strategic branch network optimisation and improved customer service.

It will also maintain cost discipline while investing in technology and systems to enhance operational efficiency. In addition, the group will uphold prudent lending practices and robust collateral valuation processes to minimise credit risk.

The company said it remains committed to maintaining a sustainable dividend policy that rewards shareholders while preserving sufficient capital for future growth opportunities.

“While macroeconomic headwinds, including potential interest rate adjustments and inflationary pressure, may present challenges, the group's proven business model, experienced management team, and strong market position provide a solid foundation for continued growth and value creation.

“Pappajack remains committed to delivering sustainable performance and maintaining its position as a reliable and responsible provider of pawnbroking services in Malaysia,” Pappajack said.

In the third quarter ended Sept 30, Pappajack’s net profit rose 23.6% to RM8.1mil, or 0.50 sen per share, lifting its nine-month profit 19.9% to RM21.3mil, or 2.78 sen per share.

Revenue for the quarter increased 12.1% to RM32.6mil, bringing nine-month revenue 11.6% higher to RM99.3mil.

The board has declared a third interim single-tier tax-exempt dividend of 0.5 sen per share, amounting to RM3.84mil, for the financial year ending Dec 31, 2025.

Group CEO Jack Lim said the 12.1% revenue growth and 23.6% rise in net profit reflect sustained demand for the group’s pawnbroking services and effective operational execution.

“Our gross profit margin expansion to 43.5% underscores improved operational efficiency and favourable business mix. Both our business segments performed well, with the pawnbroking segment maintaining its consistently high margins while the unredeemed pledges segment contributed steady returns.

“The continued growth in profitability has enabled us to reward our shareholders through consistent dividend distributions while maintaining a strong capital base to support future business development,” Lim said.