Profit growth came despite a 20.4 per cent year-on-year decrease in revenue
TECHNOLOGY solutions provider Aztech Global : 8AZ 0% announced a net profit of S$15.9 million for the first quarter ended Mar 31, a 18.7 per cent increase from the S$13.4 million recorded in the corresponding period a year ago.
The growth came despite a 20.4 per cent year-on-year decrease in revenue to S$128.6 million in Q1 2024 from S$161.6 million in Q1 2023, said the group in a bourse filing on Tuesday (Apr 23).
It noted that the fall in revenue was due to the “rescheduling of customer orders and negative impact resulting from heavy snowstorms in China”.
The group’s earnings before interest, taxes, depreciation and amortisation (Ebitda) rose to S$21.5 million, a 22.2 per cent increase from the S$17.6 million in the corresponding year-ago period, while Ebitda margin improved by 580 basis points to 16.7 per cent from 10.9 per cent.
The rise in Ebitda was mainly attributable to net fair-value gain on foreign exchange of S$2.3 million, as opposed to a net loss of S$3.1 million in Q1 2023, as well as write-back of provision for loss of trade receivables amounting to S$1.2 million.
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Earnings per share stood at S$0.0206, up 19.1 per cent from the S$0.0173 in Q1 2023.
The group has secured a healthy order book of S$456 million as at Apr 23 this year. In the second quarter, in addition to secured orders for production, it will be focusing on fulfilling the deferred Q1 orders, the group said.
Aztech Global is cautiously optimistic about its business prospects for the financial year, despite concerns such as supply chain management, inflationary pressures, foreign currency fluctuations, a high interest rate environment, and geopolitical tensions. Presently, 84.3 per cent of the group’s revenue comes from North America.
The group is looking to grow its Internet of Things (IoT) and electronics manufacturing service business and line of vision technology products.
IoT devices and data communications products currently act as the group’s key revenue contributor, accounting for 99.1 per cent of the total revenue while the remaining 0.9 per cent comes from LED lighting and other electronics products. Sales revenue from the IoT devices and data communications segment decreased to S$127.5 million in Q1 2024 from S$158 million a year ago.
Shares of Aztech Global closed 2.7 per cent or S$0.025 higher at S$0.935 on Tuesday, before the announcement.
