Slump in construction drags Vivocom's 1Q profit down 74%

KUALA LUMPUR (May 31): Vivocom International Holdings Bhd's net profit fell 74% to RM5.24 million in the first quarter from RM19.87 million a year ago, as it recorded a slump in construction revenue.

Its overall revenue for the three months ended March 31, 2017 (1QFY17) was down 71% year-on-year at RM41.03 million from RM141.54 million, mainly as the year before benefitted from the more aggressive roll-out of projects to clear backlogs.

Notably, its construction's topline was down 86% y-o-y to RM17.93 million, compared to RM125.81 million previously.

The slump was partly mitigated by stronger topline from both its telco and aluminium segments, it said, which grew 11% to RM8.54 million and 81% to RM14.57 million, respectively.

The telco division accounted for 20.8% of the group's revenue in 1QFY17, while the aluminium segment made up 35.5%. Construction was the major contributor at 43.7%.

Moving forward, the group said it will be kept busy for the next two to three years after being awarded numerous projects under both its aluminium and construction segments.

"In view of these positive developments and the group's strong order book, barring any unforeseen circumstances, the board is optimistic of achieving a satisfactory performance for the current financial year ending Dec 31, 2017," it said.

Vivocom shares settled unchanged at 13.5 sen today, for a market capitalisation of RM420.45 million. — theedgemarkets.com

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