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ECS ICT 3Q net profit up 57%, declares 2.5 sen dividend

TheEdge Thu, Nov 08, 2018 06:46pm - 2 years ago

KUALA LUMPUR (Nov 8): ECS ICT Bhd has recorded a 56.9% spike in net profit to RM7.67 million in the third quarter ended Sept 30, 2018 versus RM4.89 million last year, on higher gross profit margin in both its ICT Distribution and Enterprise Systems segments.

Earnings per share amounted to 4.3 sen, compared with 2.7 sen in the previous corresponding quarter.

Revenue, however, slipped 1.04% to RM436.21 million in 3QFY18, because of slower market conditions and uncertainties - the result of a change in government in May - and the transitional period when the Goods and Services Tax was replaced with the Sales and Service Tax (SST).

In a filing to Bursa Malaysia, the company attributed the lower revenue to lower contribution from its ICT Distribution segment.

ECS has proposed a single interim dividend of 2.5 sen per share for its financial year ending Dec 31, 2018 (FY18), payable on Dec 19.

For the cumulative nine-months (9MFY18), net profit rose 11% to RM16.32 million or 9.1 sen per share, against RM14.72 million or 8.2 sen per share last year, while revenue declined 11.55% to RM1.19 billion, from RM1.34 billion.

Looking ahead, ECS said it will strive to maintain its performance momentum and is making greater effort to build up its commercial enterprise business, despite the challenging outlook for its fourth quarter. 

“The economic uncertainties across the region, as well as [in] Malaysia, have dampened overall market sentiment,” the company said, adding that the reintroduction of SST in September had also impacted many ICT products and services.

Moreover, it observes that consumer spending remains weak and foresees lower demand for consumer products in the last quarter.

ECS closed 2.5 sen or 2.6% higher to 98.5 sen today, for a market capitalisation of RM177.3 million.

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