DNeX records net profit of RM101.2 million in 9M 2016, up from RM11.8 million in previous year

  • Y-o-Y, 3Q 2016 revenue up 60 per cent to RM36.8 million, net profit grew to RM6.8 million
  • Share of result of associate Ping contributed RM6.9 million during the quarter

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Sharifah Kasim Al Edrus
Head, Media & Investor Relations
Dagang NeXchange Berhad
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email: media@dnex.com.my

Kuala Lumpur, 24 November 2016 – Dagang NeXchange Berhad (“DNeX”) has announced a strong set of financial results for the third quarter ended 30 September 2016 (“3Q 2016”).

In 3Q 2016, revenue grew by 60 per cent to RM36.8 million from RM23.0 million in the previous year. In the quarter, the Group also completed the acquisition of OGPC Group, on 3 August 2016, marking its maiden contribution to the financial performance of the Group.

The increase in revenue was attributed to the contribution of OGPC Group and growth in the Group’s business-to-Government (“B2G”) and business-to-business (“B2B”) e-Services for Trade Facilitation.

The Group’s net profit grew to RM6.8 million in 3Q 2016 as compared to RM4.7 million in the previous year. Included in the Group’s net profit is a share of result of associate of RM6.9 million, contributed by associate company, Ping Petroleum Limited (“Ping”).

In the quarter, the Group recognised an extraordinary item charge of RM4.9 million, which consists of acquisition cost of subsidiary companies and implementation of Employee Share Option Scheme (“ESOS”).

The Group’s revenue for the nine months ended 30 September 2016 (“9M 2016”) increased by 64 per cent to RM111.1 million as compared to RM67.6 million in the same period the previous year. Its net profit for 9M 2016 stood at RM101.2 million, a significant improvement from RM11.8 million in the previous year.

While the IT and e-Services segment contributed 89 per cent to the Group’s 9M 2016 revenue, the Group’s net profit was largely contributed by the Energy segment. DNeX’s Energy segment contributed RM86.3 million while IT and e-Services segment contributed RM16.9 million to the Group’s income attributed to owners of the company in 9M 2016. The significant net profit from the Energy segment is attributed to the share of result of associate company, Ping.

“Our financial performance continues to be boosted by the continuous growth of our IT and e-Services and Energy business units,” said Encik Zainal Abidin Jalil, Group Managing Director of DNeX.

He said while its Trade Facilitation business continues to provide a recurring and consistent income stream, the Group continues to invest in new IT initiatives to further expand its service offerings.

“As for our diversification into Energy, crude oil prices have remained fairly stable at USD45 to USD50 per barrel and this has augured well for us. Ping has succeeded at keeping the operating costs low at our Anasuria cluster asset in North Sea, UK and the asset has been operated profitably and is generating positive cashflow in the current oil price environment,” he added.

DNeX’s current cash balance of RM64.2 million and its low gearing ratio of 0.02 times as of 30 September 2016 allow the Group to further pursue potential investment project in both IT and e-Services as well as Energy businesses when opportunities arise.

With the completion of the rights issue and special issue exercise, the Group’s balance sheet has strengthened and is in a net cash position as at 30 September 2016. 9M 2016 basic earnings per share increased to 10.44 sen from 0.96 sen in the previous year.