Kronologi net profit more than double despite weaker sales in Malaysia
By Goh Thean Eu February 22, 2017
- Revenue in Malaysia, Thailand and the Phillipines suffered a significant decline
- Singapore business grew 23% to RM52.49 million and Indonesia more than tripled to RM4.46 million.
MALAYSIAN-based data solutions provider Kronologi Asia Bhd's full year net profit more than doubled to RM7.43 million, while revenue jumped 32.5% to RM81.28 million, mainly driven by stronger overseas business. [RM1 = US$0.23]
During the full year period, the company's Singapore business grew 23% at RM52.49 million and Indonesia more than tripled to RM4.46 million.
The year also saw first time revenue contributions of three months (October to December 2016) from recently-acquired wholly-owned unit Quantum Storage (India) Pte Ltd. Quantum Storage was formerly an associate company of Kronologi.
As a result of the acquisition, the company registered over RM10.48 million in revenue for the full year (versus RM84,000 a year ago).
While Singapore, India and Indonesia registered growth, businesses in other key markets suffered a decline in revenue.
For the full year ended December 31, 2016, its business in the Philippines, Malaysia and Thailand registered a revenue decline of 25%, 39%, and 25% at RM3.94 million, RM3.59 million, and RM1.71 million, respectively.
Growing EDM demand
The company currently has two core businesses -- enterprise data management (EDM) infrastructure technology, and EDM managed services.
In 2016, both these core businesses have grown significantly. Both its EDM infrastructure technology and EDM managed services divisions rose 36% at RM80.16 million, and RM6.26 million, respectively.
Both these division also registered an improvement in their bottomline. EDM Infrastructure technology's net profit more than doubled to RM8.15 million (2015: RM2.98 million), while managed services increased from RM634,000 in 2015 to RM724,000 in 2016.
"Asia Pacific, one of the fastest growing markets for global cloud services, is witnessing increasing demand for hybrid cloud storage and other data management applications.
"In an age of rising connectivity, companies in the region, including small and medium sized enterprises (SMEs) increasingly recognise the importance for constant compliance, regulation, and safekeeping of their digital assets," said acting chief executive offcer, chief technology officer and executive director Philip Teo.
Plans moving forward
This year, Kronology will be focusing on growing its managed services segment.
"The Quantum Storage (India) acquisition in October 2016 marked the beginning of a new phase of growth for the group. Going forward, we will focus on improving our sales mix, as well as building on our managed services segment," said the company, which is also listed on Bursa Malaysia.
It added that it will be constantly on a lookout of viable merger and acquisition opportunities.
"Barring unforeseen circumstances, the group expects its financial year 2017 performances to surpass that of financial year 2016," said Kronologi.
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