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Investment & Market Trends

Autocount Q1 Sales Surge on Software Demand

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KUALA LUMPUR: Developer and distributor of financial management software Autocount Dotcom Bhd (ADB) posted strong earnings for the first quarter (Q1) ended March 31, 2024 (FY24), showcasing significant growth and resilience in its operations. The company’s revenue rose 31.22 per cent year-on-year (YoY) to RM13.67 million in Q1 FY24 from RM10.42 million in the same quarter last year. This surge was primarily attributed to increased sales of financial management software, which comprises 88.05 per cent of the total revenue. Technical support and maintenance business segment, and others, which contributed 9.24 per cent and 2.71 per cent to the ADB’s total revenue respectively, also saw improvements during the quarter. In line with the top-line improvement, ADB’s profit before tax (PBT) also increased by 13.73 per cent to RM5.38 million as compared with RM4.73 million in the corresponding quarter of the previous year. The PBT margin stood strong at 39.33 per cent. Meanwhile, net profit came in at RM4.07 million, representing an increase of 11.03 per cent from RM3.66 million reported in Q1 FY23. ADB managing director Choo Yan Tiee said the company’s strong performance in the first quarter reflects the robust demand for its financial management solutions. “With the upcoming implementation of e-invoicing by August 1, 2024, we are prepared to seamlessly integrate this service, enabling our existing clients to easily adopt this enhancement without disrupting their operations. “This additional service aligns with the national mandate and enhances our product offerings, ensuring comprehensive financial management solutions, including streamlined invoicing processes, improved tax compliance, and optimised reporting capabilities. “The anticipated increase in demand for e-invoicing is poised to significantly contribute to our growth trajectory as businesses seek efficient and compliant solutions in the evolving digital landscape,” he said in a statement. Since the company’s listing on the ACE market last year, demand and enquiries for ADB’s solutions have risen, in line with its objectives for listing, bolstering the company’s confidence in driving regional expansion. The company’s results are bolstered by significant contributions from its core segments, including the distribution of financial management software and technical support and maintenance services. The geographical revenue distribution shows Malaysia as the primary revenue contributor, followed by a notable presence in Singapore. “While the company’s primary revenue contributor continues to come from Malaysia at 86.7 per cent, ADB has established a notable presence in Singapore. “We will continue to leverage government initiatives across Malaysia and other Southeast Asia countries to promote digital transformation. “With a firm commitment to innovation and regional expansion, ADB is well-positioned to navigate the growing demand for digital financial solutions,” he said. Looking forward, ADB is optimistic about the growth prospects for the remainder of the year, which will be driven by ongoing digital transformation initiatives and the anticipated growth in the financial management software industry. With the integration of e-invoicing services, ADB’s approximately 210,000 client base will also benefit from the design that streamlines their invoicing processes, enhances compliance and improves overall efficiency. “This development presents substantial growth opportunities for the company, as we anticipate increased demand and further expansion in our market presence,” Choo said.

Investment & Market Trends

KAB Secures RM29.5 Million Engineering Contract from Mah Sing Group

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KUALA LUMPUR: Sustainable energy and engineering solutions provider Kinergy Advancement Bhd (KAB) has bagged another engineering contract worth RM29.5 million from Mah Sing Group Bhd (Mah Sing). This marks the 14th contract won by KAB, following the M Nova project announced on December 5, 2023. In March, Pembinaan Bintang Baru Sdn Bhd (PBB) also firmly appointed KAB as their sub-contractor for electrical works for a contract worth RM9.8 million. These contracts highlight KAB’s 27-year reputation as an electrical specialist in the engineering sector, even as the company has transformed into a leading player in the energy industry, specifically in the realm of sustainable energy solutions (SES). Both contracts, valued at RM39.3 million, have been awarded to KAB in recognition of its valued engineering work and comprehensive range of electrical services for residential development over the years. KAB executive deputy chairman and group managing director Datuk Lai Keng Onn said the latest contract win marks the company’s 14th project for property giant Mah Sing and 13th for Bintang Baru. “Our expertise and reputation in the engineering field remain strong with returning and regular reputable clients. “Their trust in our competence and capabilities to drive the success and excellence of their esteemed projects keeps us optimistic. “We believe that the engineering sector will continue to sustain itself and play a pivotal role as one of the enablers to the company’s growth,” he said in a statement. Over the past 27 years, KAB has successfully executed 119 projects spanning residential, industrial, and commercial developments. The company’s engineering segment boasts an order book balance of approximately RM166.0 million and pending tenders worth RM153.8 million. This strong foundation also positions KAB favourably to benefit from Malaysia’s revitalised infrastructure development, increased demand for residential, commercial, and industrial projects, and heightened investment in infrastructure projects. With these new contracts, KAB is poised to continue its trajectory of success in the engineering sector.  

Uncategorized

Powerwell Holdings’ FY24 PAT Tripled to RM19.71Mil, Targets Data Centre Sector Growth in FY25

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KUALA LUMPUR: Leading innovator in electrical solutions Powerwell Holdings Bhd (PHB), posted record-high earnings for the financial year ended March 31, 2024 (FY24), underscoring the company’s strategic success and operational excellence. The company posted a net profit of RM19.71 million for the year, nearly tripling the previous year’s net earnings of RM6.81 million. This marks the highest annual profit in the company’s history, showcasing a remarkable growth trajectory since its listing on the ACE market of Bursa Malaysia in 2020. The company’s robust earnings growth was fueled by heightened profitability from several high-value projects, including notable ventures such as the semiconductor plant, solar power plant, and data centres. These projects contributed to an increase in the gross profit margin, which rose to 29.7 per cent this year from 15.5 per cent in the previous period. This profitability was further enhanced by reduced operating expenses, partly attributed to the write-off of intangible assets connected to the enterprise resource planning (ERP) system costs incurred in the prior year. Meanwhile, the company’s revenue saw a slight dip to RM154.77 million from RM159.09 million, primarily attributed to a reduction in projects delivered within the current financial year. This was notably influenced by the near completion of the semiconductor plant project, which had previously bolstered earnings. Despite this downturn, PHB showcased its resilience by securing substantial revenue from several high-value projects. These included a solar power plant project in Bangladesh and various data centres and commercial properties projects, which contributed significantly to the overall financial performance during this period. For the fourth quarter (Q4) FY24, the company achieved a net profit of RM6.46 million, more than doubling the RM2.80 million from the same quarter last year. The PBT for the quarter rose impressively to RM8.60 million from RM3.52 million, reflecting robust management and strategic execution. PHB executive director Catherine Wong said the company’s landmark achievements this financial year demonstrated its strategic prowess and commitment to operational excellence. “Our record-high profit after tax reflects our ability to manage high-value projects and adapt to market demands effectively. “This success is a testament to the hard work and dedication of our team across all levels of the organisation. “As we move forward, we remain focused on sustaining our growth trajectory and enhancing shareholder value through innovative solutions and prudent management practices,” she said. Looking forward, PHB is optimally positioned to capitalise on the accelerated growth of the data centre market in Malaysia and Southeast Asia, a region experiencing exponential demand for cloud services and digital transformation. With the Malaysian market projected to attract US$2.25 billion in investments by 2028, PHB’s recent acquisition of purchase orders worth RM57.61 million for a significant data centre project in Selangor highlights its strategic role in this expanding sector. Additionally, PHB has declared and approved the payment of a third single-tier dividend of 1.0 sen per ordinary share in respect of FY24, payable on July 30, 2024, bringing the total dividend payout for FY24 to 3.0 sen per ordinary share. “This distribution is part of our broader financial management strategy to reward our investors while maintaining ample resources to fund future growth initiatives,” Catherine said. As of March 31, 2024, PHB has a robust cash balance of RM88.1 million, up significantly from RM49.7 million the previous year. This allows the company in a strong position to pursue strategic growth opportunities through mergers and acquisitions and investment to enhance its technological capabilities and expand its market footprint. “With a strong financial position, this allows PHB to be agile and responsive in a dynamic market environment including pursuing strategic acquisition opportunities to accelerate our growth,” Catherine added.

News

SMRT Holdings Berhad Announces Strong Financial Results for 3QFY24 and 9MFY24

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CYBERJAYA: Pure play enterprise Internet of Things (IoT) solutions provider, SMRT Holdings Berhad (“SMRT” or the “Group”), has released its financial results for the third quarter (3QFY24) and nine months (9MFY24) ended 31 March 2024. The company previously changed its financial year-end to 30 June 2023 from 31 December 2022, which means comparative figures for the corresponding period last year are not available. In the third quarter of FY24, SMRT reported revenue of RM16.1 million, maintaining consistency with the RM16.8 million revenue from the previous quarter (2QFY24). The Group achieved a net profit of RM6.9 million in 3QFY24, reflecting a robust net profit margin of 42.7%. This profit includes a one-off gain of RM1.0 million from the disposal of an investment in a subsidiary. For the nine-month period ending 31 March 2024, SMRT recorded total revenue of RM51.2 million and a net profit of RM20.6 million. The Group’s financial health remains strong, with a net cash position and cash per share of 5.9 sen as of the end of March 2024. Group Managing Director, Mr. Maha Palan, expressed his satisfaction with the company’s performance: “We are delighted to have maintained positive momentum, delivering solid results and reinforcing our position as a leading pure play enterprise IoT solutions provider. Our primary markets in Malaysia and Indonesia continue to show promising growth, positioning us well to extend our successful business model into new ASEAN markets.” Mr. Palan highlighted SMRT’s recent venture into the financial services sector in the Philippines, noting it as a significant driver for future growth. He also emphasised the importance of the company’s recurring income base, which currently accounts for over 50% of total revenue. “Confident in our strategic direction, SMRT remains dedicated to becoming the leading provider of comprehensive end-to-end IoT services across ASEAN,” he added. The company’s focus on expanding its managed sites is expected to further enhance its recurring income, solidifying SMRT’s financial stability and growth prospects in the region.

Investment & Market Trends, News

MSC Reports Net Profit of RM18.2 Million for 1QFY24

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KUALA LUMPUR AND SINGAPORE: Malaysia Smelting Corporation Berhad (MSC), a leading tin miner and metal producer, has announced its financial results for the first quarter ended 31 March 2024 (1QFY24). During this quarter, MSC’s net profit attributable to owners surged by 93.6% quarter-on-quarter (QoQ) to RM18.2 million, up from RM9.4 million in the previous quarter (4QFY23). This significant increase was primarily driven by a rise in average tin prices (RM124,900/tonne in 1QFY24 compared to RM116,000/tonne in 4QFY23). The Group’s tin smelting division recorded a net profit of RM9.9 million in 1QFY24, a turnaround from a net loss of RM2.2 million in 4QFY23. This recovery was attributed to favorable tin price movements and foreign exchange gains during the quarter. Similarly, MSC’s tin mining operations saw a net profit increase of 19.3% QoQ to RM14.2 million in 1QFY24, up from RM11.9 million in 4QFY23, benefiting from the stronger tin prices. Meanwhile, MSC’s revenue for 1QFY24 stood at RM362.5 million, down from RM404.6 million in 4QFY23. Despite the higher tin prices, the Group’s performance was impacted by a shortage of tin ore, leading to lower refined tin sales and smelting revenue. However, the Group believes the situation in tin ore-producing countries like Myanmar and Indonesia, which has affected MSC’s toll smelting business, will improve. MSC Group Chief Executive Officer, Dato’ Patrick Yong commented, “Our 1QFY24 performance demonstrated resilience amidst a challenging global landscape characterized by ongoing inflation, tightening monetary policies, and supply chain disruptions. We remain committed to securing a reliable supply chain and executing our long-term growth plans.” Yong added, “The relocation of our smelting operations from Butterworth to the newer Pulau Indah smelter is nearly complete, with the Butterworth smelter set to be decommissioned by 2025. On the mining side, we are working to enhance productivity by expanding mining activities and exploring new tin resources.” “Looking ahead, our commitment to sustainable growth ensures a brighter future for MSC. We are confident in our ability to unlock new opportunities and solidify our position as a leader in the tin industry.” As of 31 March 2024, total borrowings decreased by 17.4% to RM297.3 million, down from RM359.8 million as of 31 December 2023, due to repayment of borrowings. This resulted in an improved gearing ratio of 0.35x as of 31 March 2024. Year-on-year (YoY), MSC’s revenue grew by 6.6% to RM362.5 million from RM340.1 million, driven by favorable tin price movements. Tin prices averaged 7.6% higher at RM124,900/tonne in 1QFY24 compared to RM116,100/tonne in 1QFY23. The Group’s smelting division posted a net profit of RM9.9 million in 1QFY24, compared to RM24.6 million in 1QFY23. The slower performance was mainly due to the absence of sales of refined tin derived from processed tin intermediates and by-products, as well as lower smelting revenue. The tin mining segment reported a net profit of RM14.2 million in 1QFY24, down from RM17.5 million in 1QFY23, due to lower tin production quantities.

Investment & Market Trends, News

Bursa Malaysia Launches API Gateway to Enhance Investor Onboarding Experience

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KUALA LUMPUR: Bursa Malaysia Berhad (“Bursa Malaysia” or the “Exchange”) has recently introduced an Application Programming Interface (“API”) Gateway to enhance the efficiency of Central Depository System (“CDS”) account management processes by Participating Organisations (“POs”) or brokers. This initiative leverages technology to improve the CDS account holder experience and boost investor participation in the equities market. The API Gateway streamlines the investor onboarding process, reducing turnaround times for account opening, updating, and reactivation. These enhancements enable investors to trade quickly, seizing opportunities as they arise. Additionally, the Gateway allows POs to further digitalize their processes, improving customer experience and promoting sustainability by reducing the carbon footprint. Datuk Muhamad Umar Swift, Chief Executive Officer of Bursa Malaysia, commented, “The Exchange actively listens to the evolving needs of our customers. This initiative is key in delivering on our commitment to greater customer-centricity. We will continue to work closely with our POs and introduce service innovations to attract more investors, bolstering the competitiveness of our market.” The API Gateway for CDS e-services is now operational. To date, five POs have signed up for the service: AmInvestment Bank Berhad, FSMOne – Online Retail Division of iFAST Capital Sdn Bhd, Hong Leong Investment Bank, Malacca Securities, and Moomoo Securities Malaysia. Other POs interested in offering these enhancements to their customers can visit API Services or email [email protected]. This API Gateway launch complements the recent introduction of the BURSA Remisier Acquisition Hub (“BURSA REACH”), Malaysia’s first profiling platform connecting investors with dealer’s representatives. Together, these initiatives demonstrate the Exchange’s commitment to using technology to provide easy access to investment opportunities and foster a vibrant capital market.

Investment & Market Trends, News

Kelington 1Q24 Net Profit Rose 53.3% to RM24.8 Mil, Declares Dividend of 2 sen

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KUALA LUMPUR: Kelington Group Berhad, an integrated engineering solutions provider, announced outstanding financial results for the first quarter ending 31 March 2024 (1Q24). The Group’s net profit surged by 53.3%, reaching RM24.8 million, up from RM16.2 million in the previous year (1Q23). Additionally, revenue increased by 10% to RM339.3 million, compared to RM308.9 million in 1Q23. This growth was primarily driven by substantial revenue increases in key markets, particularly Malaysia (+6%) and China (+129%), which contributed 45% and 31% of the total revenue in 1Q24, respectively. The Ultra High Purity (UHP) division remained the largest revenue contributor, accounting for 61% of the Group’s total revenue in 1Q24. The UHP division’s revenue grew by 12% to RM205.5 million, fueled by several major UHP projects awarded in the second half of 2023. The Process Engineering division generated RM21.4 million, representing 6% of the Group’s total revenue for 1Q24. The General Contracting division saw a 21% year-on-year (YoY) increase in revenue, totaling RM78.4 million, driven by increased project recognitions and a significant project in Kuching. The Industrial Gases division also performed strongly, with revenue rising by 47% YoY to RM35.9 million, largely due to heightened demand for liquid carbon dioxide (LCO2) from Oceania countries. Commenting on the financial performance, Ir. Raymond Gan, Chief Executive Officer of Kelington Group Bhd, stated, “We are pleased with the commendable results across our business divisions, which lay a solid foundation for the year. Our order book continues to replenish at a steady pace.” “Since the beginning of the year, we have secured contracts worth RM235 million as of 31 March 2024. Including carried forward projects, our total order book stands at RM1.54 billion, with RM1.25 billion still outstanding as of 31 March 2024.” “The start of operations at our second LCO2 plant in March 2024 has doubled our annual production capacity to 120,000 tonnes. This expanded capacity strategically positions us to meet the growing demand both locally and internationally, especially given the global LCO2 shortage driven by the shutdown of petrochemical plants due to environmental concerns,” he added. As of 31 March 2024, the Group’s gearing ratio improved to 0.44. Total borrowings decreased to RM166.6 million from RM188.2 million as of 31 December 2023, primarily due to debt repayments in Malaysia and Singapore. Kelington maintains a robust balance sheet with a net cash position of RM135.5 million as of 31 March 2024, significantly up from RM81 million as of 31 December 2023, largely due to debt repayments and proceeds from nearing the completion of several large projects. The Board of Directors of Kelington has proposed a first interim tax-exempt dividend of 2 sen per ordinary share for the financial year ending 31 December 2024, amounting to RM13.3 million.

Energy & Technology, Investment & Market Trends

Digital Banks Won’t Disturb Business For Traditional Banks, Says Expert

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KUALA LUMPUR: The emergence of digital banks in Malaysia does not significantly impact traditional banks, primarily due to their limited ability to achieve rapid growth within the initial years of operation. S&P Global Ratings Senior Analyst of Financial Institution Ratings in South and Southeast Asia (SSEA), Sue Ong said that the five digital banking licences issued by the Bank Negara Malaysia (BNM) in 2022 do not seem to be a game changer for now. “There are a couple of licensing requirements by BNM and the main one is that digital banking players need to serve the underbanked or unbanked population. “Malaysia already has a very high banking penetration rate at more than 90% (of the population) and these are served by the traditional Malaysian banks,” she said during a webinar themed ‘Key Credit Risks For Malaysian Banks and Economic Outlook’. BNM also requires digital banks to cap their assets at RM3 billion within the first 3 to 5 years of their operation. “This means that digital banks are unable to grow very quickly within the first few years. This will be a very small share of the total asset size of the Malaysian banking sector,” she pointed out. Meanwhile, Ong said that potential competition may come from promotional campaigns during the launch of digital banks since they could attract customers with appealing deposit offers. “But it is uncertain whether these deposits will remain steady once the promotions end, as it remains to be tested against the traditional banks’ deposit base,” she said. She also noted that traditional banks have stepped up their efforts and significantly enhanced their digital services offerings, focusing on improving user experience through mobile banking applications to compete with digital banks’ offerings. “They have introduced numerous new digital products tailored for small and medium enterprises (SMEs) and micro SMEs, which are very similar to those by digital banks,” she added. — BERNAMA

Investment & Market Trends, News

Farm Price Holdings Berhad’s IPO Oversubscribed by 91.35 Times

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KUALA LUMPUR: Farm Price Holdings Berhad (“Farm Price”), a wholesaler and distributor of fresh produce, food and beverage (“F&B”) items, and other groceries based in Johor, has attracted substantial interest from investors for its initial public offering (“IPO”). The IPO has been oversubscribed by 91.35 times ahead of its listing on the ACE Market of Bursa Malaysia Securities Berhad (“Bursa Securities”). Farm Price, along with its subsidiaries, primarily engages in wholesale and distribution activities, serving markets in Malaysia and Singapore. Additionally, the group operates a retail outlet in Ulu Tiram, Johor, catering directly to end-consumers. With two decades of experience in fresh produce distribution, Farm Price currently operates its Senai Centralised Distribution Centre in Johor, equipped with cold room facilities for storage, processing, and packaging, alongside ambient temperature zones. Furthermore, the group’s operations are bolstered by six regional distribution centres in Johor, Selangor, Perak, and Penang, focusing on wholesale distribution of F&B products and groceries. Farm Price serves a diverse customer base, including supermarkets, minimarkets, grocery stores, wholesalers, food service operators, food manufacturers, and individual consumers. The IPO of Farm Price comprises 450,000,000 ordinary shares, featuring a public issue of 102,000,000 new shares at an issue price of RM0.24 per share, representing 22.67% of the enlarged share capital. The public issue is expected to raise RM24.48 million. Additionally, there is an offer for the sale of 33,000,000 existing shares by way of private placement to selected investors. Farm Price received a total of 16,647 applicants for 2,077,765,600 shares, valued at approximately RM498.66 million, for the 22,500,000 shares allocated to the Malaysian public, resulting in an oversubscription rate of 91.35 times. For the Bumiputera portion, 9,895 applications for 1,030,653,700 shares were received, representing an oversubscription rate of 90.61 times. Regarding the public portion, 6,752 applicants submitted requests for 1,047,111,900 shares, resulting in an oversubscription rate of 92.08 times. The 11,250,000 shares available for application by eligible directors, employees, and contributors to the company’s success have been fully subscribed. Furthermore, the private placement of 68,250,000 shares and 33,000,000 offer shares made available for application by selected investors through private placement have also been fully placed. All successful applicants will receive notices of allotment by 10 May 2024. Dr. Tiong Lee Chian, Managing Director of Farm Price, expressed gratitude for the overwhelming response to the IPO, reflecting confidence in the company’s fundamentals and prospects. With the IPO funds, Farm Price aims to expedite expansion plans to capitalize on growth opportunities within the fresh produce industry. Dr. Tiong Lee Chian stated, “Amidst a fragmented landscape, Farm Price sets itself apart through experienced expertise, a diverse range of fresh produce, in-house infrastructure, a global sourcing network, and robust distribution channels. To strengthen our position in fresh produce distribution and drive further growth, our future plans include expanding our Senai Centralised Distribution Centre, purchasing machinery, equipment, and logistics fleet, establishing additional regional distribution centres, and setting up a sales and marketing office in Singapore.” He emphasized the significance of the fresh vegetables industry for Malaysia’s food security and highlighted increasing demand in Singapore, fueled by Farm Price’s commitment to quality and value-added services. Dr. Tiong Lee Chian concluded by expressing excitement for expanding reach and meeting the growing demand for fresh vegetables in the city-state. Farm Price is set to be listed on the ACE Market of Bursa Securities on Tuesday, 14 May 2024, with an anticipated market capitalization of approximately RM108.00 million based on an issue price of RM0.24 per share and an enlarged share capital of 450,000,000 shares. Alliance Islamic Bank Berhad serves as the Principal Adviser, Sponsor, Sole Underwriter, and Placement Agent for the IPO Exercise.

Investment & Market Trends, News

Dagang Net, a Subsidiary of DNeX, Achieves CMMI Maturity Level 3 Appraisal

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CYBERJAYA: Dagang Net Technologies Sdn Bhd (“Dagang Net”), a wholly-owned subsidiary of Dagang NeXchange Berhad (“DNeX”), has achieved an impressive milestone by attaining Maturity Level 3 of the CMMI Institute’s Capability Maturity Model Integration (CMMI)® Version 3.0 for its Technology and Human Resource functions. The CMMI framework serves as a guide for organizations aiming to enhance their operational efficiency by improving their capabilities. This appraisal signifies Dagang Net’s adherence to well-defined processes, as per established standards, procedures, tools, and methods. Valid until 12th April 2027, this recognition underscores Dagang Net’s continuous refinement and enhancement of its standard operating procedures over time. Tan Sri Syed Zainal Abidin Syed Mohamed Tahir, Executive Chairman of DNeX, expressed pride in this achievement, emphasizing the company’s unwavering dedication to quality output. He highlighted how this milestone not only strengthens customer trust but also underscores Dagang Net’s commitment to delivering innovative solutions and exceeding customer expectations. In line with their dedication to continual improvement, the company actively solicits feedback from customers to identify areas for enhancement. This proactive approach ensures that their products and services remain competitive and relevant in the ever-evolving market landscape. Tan Sri Syed Zainal Abidin Syed Mohamed Tahir affirmed the company’s belief in the journey of continuous improvement, stating their commitment to reviewing product performance, identifying opportunities for enhancement, and implementing improvements based on data-driven insights and customer feedback.

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