SINGAPORE (Feb 1): IPS Securex, the provider of integrated security solutions, reversed into 2Q losses of nearly $16,000 from a profit of $0.48 million a year ago due to lower other income and higher administrative expenses.
1H19 also swung into the red with losses of $0.32 million compared to earnings of $0.26 million in 1H18.
Group revenue decreased 3.8% to $2.5 million in 2Q19. Revenue from the Security Solutions Business decreased by half to $523,000 was mainly attributable to the decrease in demand for integrated security solutions in Singapore of $576,000, partially offset by an increase in the sales of security products to customers in East Asia and Singapore of $25,000.
Revenue from the Maintenance and Leasing Business increased 28.3% to $2 million in 2Q19 mainly due to the increase in fees earned of $380,000 due to the ad-hoc replacement of a component in a security system for a public sector customer in Singapore in 2Q19.
Other income decreased 94.6% to $0.27 million in 2Q19 mainly due to the absence of the recovery of outstanding debts of $0.462 million in 2Q18.
Administrative expenses increased 10% to $1.4 million in 2Q19 due to the increase in employees’ remuneration and benefit expenses of mainly due to staff bonuses accrued in 2Q19 and distribution and marketing expenses of $13,000 and office related expenses of $3,000.
In its outlook, IPS Securex says although there is constant demand for integrated security solutions, the markets in which the group operates in are very different from one another politically and economically.
This often leads to slowdowns or delays in government projects and tenders which have affected the group’s business and led to lower turnover and profitability in recent quarters.
However, IPS Securex says a wholly-owned subsidiary has received a Letter of Acceptance from a government agency in Southeast Asia for a contract worth up to $19.1 million.
For the past 12 months, shares in IPS Securex have fallen by 41% to 5.3 cents on Friday.
