VSTECS Bhd net profit for its third quarter financial results for the three months ended 30 September 2023 (3QFY2023) has dipped by 23% to RM12.7 million compared to RM16.5 million in the same period last year (3QFY2022).
“Its revenue year-on-year (YoY) has also decreased by 12.1% to RM646.4 million in 3QFY2023 from RM735.5 million the previous year,” it said after 3QFY2023 results were released today (Nov 15).
In a statement, the ICT distributor said the first nine months ended 30 September 2023, the group posted revenue of RM1.92 billion, down by 8% as compared to RM2.09 billion in 9M FY2022.
Meanwhile, net profit grew slightly to RM43.2 million versus RM41.4 million in 9M FY2022, up by 1.6%.
“In the first nine months of the year, revenue from ICT services grew 66.4% YoY while the revenue Enterprise Systems segment remained relatively comparable to last year.
“The ICT distribution segment however experienced a revenue decline of 22.3% compared to 9M FY2022, as the consumer spending remained cautious,” the group added.
Nevertheless, the group declared a first interim dividend of 2.5 sen per share, payable on 12 January 2024.
Its chief executive officer JH Soong said during the third quarter of 2023, muted consumer spending continued to impact the ICT distribution segment.
“(Similarly), Enterprise Systems segment witnessed a temporary contraction due to the timing of project deliverables and the pending decision of several key public sector and large enterprise projects.
“On a more positive note, ICT services revenue has shown consistent growth over several quarters, with our investment in nurturing public cloud engagements and services now yielding good results.
“We are expecting cloud adoption to intensify, leading to an even wider take-up in the coming years, thereby increasing the contribution of the ICT Services segment for the group,” he said.
Soong said despite a softer performance in the third quarter, the group hold a positive outlook for the remainder of the financial year.
“Looking ahead to the fourth quarter, we anticipate a pick-up in the ICT distribution segment with the festive season spending.
“Consumer spending on end-point devices should regain momentum by next year, with the increase of 5G availability and the onset of the replacement cycle for numerous consumer IT products previously sold during the pandemic era.
“Enterprise spending also typically accelerates in the final quarter, especially within the financial services and public sectors as they aim to complete budgeted projects before year-end, providing impetus for the Enterprise Systems and ICT services segment,” he added.
